1 Introduction 3 - Mace · Stephen Pycroft 2014 was another rewarding and profitable year for Mace...

1 Introduction 3

25 years of a better way ............................................................................................ 4

Executive Chairman’s statement ................................................................................ 6

Chief Executive’s report ............................................................................................. 8

Corporate governance ............................................................................................. 12

About Mace ............................................................................................................. 18

2 2014 at a glance 21

Our highlights ......................................................................................................... 22

Our international presence ....................................................................................... 23

Delivering for our clients ........................................................................................... 24

Continued successes .............................................................................................. 32

Securing future work ............................................................................................... 40

3 Our values 47

Our commitment to safety ....................................................................................... 48

Client focus ............................................................................................................. 50

Opportunity ............................................................................................................. 52

Our pursuit of a better way ...................................................................................... 54

Acting responsibly ................................................................................................... 56

One Mace ............................................................................................................... 58

Recognition ............................................................................................................. 60

4 Operating reports 63

Financial report ........................................................................................................ 64

Investment report .................................................................................................... 66

Consultancy: Property report ................................................................................... 68

Consultancy: Major Programmes and Infrastructure report ...................................... 70

Consultancy: International report ............................................................................. 72

Construction report ................................................................................................. 74

Health and Safety report .......................................................................................... 76

HR report ................................................................................................................ 78

Sustainability report ................................................................................................. 80

5 Annual accounts 83

Directors’ report ...................................................................................................... 84

Independent auditor’s report to the shareholders of Mace Limited ........................... 86

Consolidated profit and loss account ....................................................................... 87

Consolidated balance sheet .................................................................................... 88

Company balance sheet .......................................................................................... 89

Notes to the Financial Statements ........................................................................... 90

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1 Introduction

25 years of a better way

Mace works with clients around the world to help shape cities and build sustainable communities for the future. We are changing the way our industry operates because we believe we have found a better way of turning our clients’ ambitions into reality.

We are committed to innovation and excellence. We are proud that our constant pursuit of a better way has resonated with our clients and is embraced by our people.

As an international consultancy and construction company, we offer integrated services across the full property and infrastructure life cycle.

Our experts in programme and project management, construction delivery, cost consultancy and facilities management thrive within our collaborative and entrepreneurial culture.

We strive to find better solutions to our clients’ infrastructure and property challenges. From London to Hong Kong to New York, and dozens of cities and communities in between, Mace is helping clients develop and build facilities that meet the needs of the future.

And with experience working on some of the most iconic projects in the built environment, Mace continues to help shape skylines across the world.

At Mace our clients are, and always will be, at the very heart of what we do. We pride ourselves on our agile, responsive approach to doing business – one that focuses on the things our clients’ value.

Our people, too, are renowned throughout the industry for always going that bit further – using their expertise and Mace’s collaborative culture to create a customised service for our clients, adding greater value and building lasting relationships.

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Birmingham New Street, Birmingham, UK

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Annual Report | 2014

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Executive Chairman’s statement

Stephen Pycroft

2014 was another rewarding and profitable year for Mace as we continued to grow and meet our targets. We have adjusted well over the past 12 months as the market has improved, both in the UK and globally. Our annual turnover increased by 26% year-on-year to £1.49bn with profit before tax at £35m and net assets of £47m. This has given us our 25th consecutive year of record earnings and a solid platform for the future.

Last year I announced our 2020 business plan which sets out our growth strategy and our aim to develop a sustainable and stable business in each of our core markets. This strategy served us well in 2014 and I have no doubt that our strong performance results from our clear vision. A vision that sees us becoming the top UK contractor and a leading international programme manager; trusted to deliver projects and programmes through our innovative and value-driven approach.

A year on and these 2020 goals still stand and I can, with confidence, state that the company is on track to meet them. In 2014 we continued to strengthen our integrated service capability and use our expertise in targeted sectors to enhance our market presence. This translated into significant wins across the property, energy, infrastructure, data centre and pharmaceutical sectors. We also further increased our market penetration in the commercial property and residential sectors, which has laid the foundations for securing new, iconic projects in these areas in 2015.

2014 was a great year for our construction business which delivered £1.2bn in turnover, a 32% increase on 2013 and four years ahead of the company’s 2020 plan. The division has been awarded some business changing appointments which include the redevelopment of the former BBC Television Centre and, outside of the UK, our first fixed price construction project started on site.

Our teams have also made enormous progress to advance the health and safety agenda this year. This impacts every level of our business as it continues to be not just a priority across our sites and workplaces, and for our clients and supply chain, but also as one of our company’s core values, embedded in the way we do business.

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We reinforced our reputation as the consultant of choice this year with Queen Elizabeth Olympic Park opening to the public. As the company responsible for the £300m post-2012 Games transformation, we are one of the only companies to have worked on the park from the initial bid stage. We are continuing to play a significant role in the implementation of the Games’ lasting legacy. The reopening of the park just 18 months after the closing ceremony is a feat unprecedented in Olympic history and we are very proud of that achievement.

It has also been a groundbreaking year for our investment business with the completion of the forward funding of the largest PRS (private rented sector) tower development in London, and with major schemes in planning for 2015 in Oxford and Glasgow.

Our cost consultancy business reached a milestone this year celebrating its 10 year anniversary. Since its launch in 2004, it has added a fantastic new dimension to the rest of our business, opening up great opportunities for us to service our clients in the public and private sectors globally, enabling us to offer our clients a truly integrated service.

Our achievements have not all been about winning work. This year, more than ever, we have considered and managed the wider community and societal impacts of our developments. Our vision, to enable local communities and individuals to thrive as a result of Mace’s programmes and projects, is going from strength to strength as we engage with young people in local schools and help create training and job opportunities on our sites and workplaces. We also pride ourselves on delivering sustainable outcomes for our clients. This year we have demonstrated a clear commitment to sustainable development by exceeding our sustainability targets across the board.

All of the achievements we have made in the last year mean we have an enviable pipeline of work that will ensure our future growth. Our businesses are in a good position with a robust 2015 order book. That being said, as the year in which we celebrate our 25th anniversary, it is more important than ever in 2015 for us to make sure we reinforce who we are as a company and what we stand for. We’ll continue to create value for our clients through our strong focus on delivery, coupled with our constant pursuit of finding ‘a better way’ to turn our clients’ ambitions into reality.

We also know that finding a better way for our clients takes talented people, which is why we continue to take steps to attract new talent and develop those we have. In 2014 we have grown by 519 people, an increase of 12%. We welcomed 76 graduates and construction trainees and expanded our Executive Development Framework in partnership with Imperial College London. We have also worked to improve our workforce diversity as a company. This year Mace signed an industry pledge to make our workplace more attractive to women, which includes a 10 point plan created by the Women in Construction and Engineering campaign. We also welcomed an increase of 36% in female graduates this year.

Challenges remain in the UK and global economies, but our vision is clear, our strategy is set and we will commit to upholding our core values as we grow. As we look ahead to celebrating our 25th year, we will continue to invest in our people and seek to build even closer relationships with our clients.

25 years ago, Mace was founded on a simple principle, to find a ‘better way’. On all of our projects, large and small, there is a common theme which like a golden thread connects all our work: we believe in a better way of working and a better way to deliver solutions for clients. The last 12 months have proved this more than ever before with proven delivery excellence for our existing clients and successful, often groundbreaking, moves into new sectors and regions across the globe. I believe that Mace, today, is well placed to meet the challenges that face us and embrace new opportunities. I look forward to reporting our progress.

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Chief Executive’s report

Mark Reynolds

2014 was a year of positive change and growth for Mace. We made significant progress towards achieving our 2020 business plan, maintaining a strong focus on innovation and delivery. The hard work of our teams across the world, together with the support of our clients and supply chain partners, has resulted in a solid performance and a strong platform for further sustainable growth.

In 2013 the Group Board set out an ambitious plan for growth by 2020. Our targets are to:

• create 3,000 new jobs across our five global hubs;

• attain a client satisfaction score of at least 85%;

• raise employee engagement levels to 90%;

• achieve an annual turnover of £2bn; and

• lead the industry with an accident frequency rate (AFR) of 0.01.

Mace’s financial performance in 2014 was robust. Our revenue and profit both rose by 26% and 8% respectively to £1.49bn and £35m. Cash balances were £101m at year end and net assets were £47m. Importantly, 72% of our 2015 target revenue was secured by the end of 2014, with an additional £300m of income awaiting contract.

As the economy improved in many of the markets where we operate, I am particularly proud of the 519 new jobs we created, growing by 12% to make to make us a company of 4,657 employees at year end.

Our long-serving Finance Director, David Vaughan left the business at Christmas after 17 successful years with the company, during which time our revenue grew from £5m to £1.49bn. I want to record my thanks to David for his commitment to Mace and the support he has given to the Group Board and wish him well for his retirement.

Joining the Group Board as David’s replacement was Dennis Hone. Dennis joins the business from the London Legacy Development Corporation, and prior to this the Olympic Delivery Authority where he was Chief Executive. To support our plan for sustainable growth, Lee Penlington also joined the Group Board as Commercial Director. Dennis and Lee’s

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appointments reflect our long-held strategy of renewal at board level.

I want to thank all of our clients who supported us in 2014 and trusted us to deliver some of the most pioneering, exciting and challenging programmes and projects in the world. Delivering to the highest standards for our clients would not have been possible without the support and dedication of all my excellent colleagues – thank you.

Project highlights

During 2014 we continued to find a better way of delivering for our clients, creating value through our unique integrated service offer.

Our investment business completed Deaconess House in partnership with the University of Edinburgh. The project comprised the redevelopment of a former NHS Lothian property into accommodation for 318 students.

In North America, Mace provided strategic programme and project management services for the construction of Porsche Cars’ new headquarters in Atlanta, Georgia. The new award-winning complex stands on a 27 acre brownfield site and will bring together all of Porsche’s major sales, after sales and financial services capacities under one roof, helping to strengthen its US market position.

Overlooking Cape Town’s Victoria and Alfred Waterfront sits Silo District, a 22,000 square metre mixed-use development. Mace acted as project manager and the principal agent for V&A Waterfront Holdings, overseeing the award-winning project from feasibility to construction and completion. In Asia, we completed Phase 3 of the Hong Kong Science Park, which is now a vibrant hub for innovation. The project was recognised with the prestigious ‘Grand Award’ at the Green Building Awards 2014.

In the UK, we completed a meticulous recreation of the famous Coronation Street set, including all 54,000 cobbles, at ITV’s MediaCityUK in Manchester. In 2014, following Mace’s work on the British Museum’s Great Court at the turn of the century, we returned to project manage the stunning World Conservation and Exhibitions Centre – one of the largest redevelopment projects in the Museum’s 260 year history.

Safety first. Second nature.

We continued to embed our ‘Safety first. Second nature.’ strategy into the business during the year. Established three years ago, the strategy aims to ensure we continue to be an industry leader in safety by building a natural culture of safety throughout our operations.

Overall we made good progress, achieving an accident frequency rate of 0.09 and a 29% reduction in lost time incidents across our sites in 2014. A particular focus for the year was improving our data collection in order to better target areas in need of improvement. We made significant progress in this area through the further roll out of our safety reporting tool YellowJacket, with a 28% increase in the number of observations recorded by our teams.

An initiative I was particularly proud of was our first ‘Safety first. Second nature.’ Awards programme to recognise safety excellence innovation across the business. Presented at a ceremony in October, awards went to our people, clients and supply chain partners who made a positive contribution to our safety agenda over the year.

Complementing our internal awards were the 11 highly respected Gold Awards from the Royal Society for the Prevention of Accidents (RoSPA) won in 2014. These accolades join the Sword of Honour from the British Safety Council. Presented to Mace’s technology and renewable energy team, this award recognised the team’s excellent efforts for one of our banking sector clients.

Client focus

I am proud to lead a company trusted with some of the world’s most exciting, iconic and challenging projects and programmes for some of the world’s leading companies and organisations.

During 2014 we successfully enhanced our relationships with clients across the globe. We secured new commissions in the rail, data centre and nuclear sectors, notably a 10 year contract with Sellafield Ltd as part of a consortium with Areva and Atkins. This is a strategically important and complex nuclear decommissioning project and one which Mace is very pleased to be part of.

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Chief Executive’s report

Mark Reynolds contd.

Our international activities were strengthened through our global framework contracts, including well-known companies Tiffany, Roche and GlaxoSmithKline (GSK).

Our flourishing construction business moved to the next level, starting work on its first project outside of the United Kingdom. I am delighted that Mace continues to be trusted by our clients to deliver to the highest standards anywhere in the world.

Macro, our facilities management business, continued to expand existing contracts and grow its client base. A key achievement was doubling its number of locations with international technology company Citrix and managing a total of 96 buildings for Siemens.

We are continually looking for ways to improve and go the extra mile for our clients, meaning we take client feedback very seriously. I am therefore pleased to report that the number of clients surveyed in 2014 who said they ‘would use Mace again’ increased to 89% and overall client satisfaction increased by 2% to 83%.

Opportunity

For 25 years it is our people who have been the key to our success. As we look ahead to 2020, we understand the importance of attracting and retaining the best talent in the industry. Crucial to not only achieving our future growth plans, but to maintaining high levels of innovation, employee satisfaction, and exceptional service to our clients.

Our total number of employees rose by 12% to 4,657, remaining on track to hit our target of creating 3,000 new jobs by 2020 to become a company of 7,200. We are starting to see the benefits of our decision in 2013 to combine our efforts into one Talent Development Board, chaired by COO for Consultancy Mark Holmes.

2014 also saw the launch of our Executive Development Framework and the Developing our Future programme, both in partnership with one of the world’s top ten universities, Imperial College London. In recognition of an issue facing the wider construction industry, we embarked on a journey to improve the diversity of our workforce. Early work in this area included a thorough revamp of our maternity and paternity policies, making them one of the best in our industry. We will continue to address work-life balance and make it easier for women

to have rewarding, long term careers at Mace. I am delighted that the number of women working at Mace increased to 28% during 2014, nearly five times the industry average.

Particularly pleasing was being ranked as the number one construction and engineering company in the UK JobCrowd top companies to work for in 2014.

Integrity and corporate responsibility

In 2014 we continued to take action to mitigate our impact as a business on the environment and further support communities in which we work. Our corporate responsibility strategy was refined to focus on three key pillars: governance and compliance; improving our environment; and supporting our communities.

The Mace Foundation, our independent charity which supports disadvantaged people and local communities appointed Mike Hanson, a former Director of HMRC as CEO. The response from our team in 2014 was again fantastic, with 850 people volunteering and charitable expenditure of £394,000. This included fundraising by Mace teams and individuals, as well as match funding by the Foundation. Since its launch in late 2012, the Foundation has donated a total of £726,000 to charitable causes which reflect our vision and values.

Our continued investment in Building Information Modelling (BIM) and application on all new Mace construction projects is resulting in significant sustainability benefits, in addition to substantial time and cost savings for our clients.

As a company founded and headquartered in the UK we are proud of our British origins and our positive contribution to the UK economy. Part of this is positively engaging with local communities, including reaching the milestone of our 100th apprentice at the Birmingham New Street redevelopment for Network Rail.

Pursuit of a better way

We pride ourselves on our ability to pioneer new techniques and solutions to meet the often dynamic nature of the complex programmes and projects we work on for our clients. As we move towards 2020 and our workforce grows, we are taking steps to ensure this culture of innovation and of finding a ‘better way’ is embedded through the business.

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Over the last financial year we have spent a total of £13m on research and development activities within Mace, demonstrating our commitment to investing in our future and maintaining our position as industry leaders. Our practical application of prefabrication on our projects is one example. By developing a unique process of building components offsite, we have significantly increased project efficiency, shortened timescales and reduced cost for our clients. We have successfully used this approach at the 5 Broadgate in London for clients British Land and Blackstone Group. For example, two plant rooms were constructed over 14 weeks off site, enabling them to be installed in just two days once delivered on site.

One Mace

As our business continues to expand and we increasingly work across borders, we recognise the need to ensure we retain consistent service and way of doing things. To meet this challenge we created the Mace Way, an internal document management system which ensures a consistent high-standard approach across every project and promotes continuous improvement and knowledge sharing. The Mace Way system was launched across our consultancy and construction businesses in 2014 and we will continue to roll it out across the business in 2015.

Looking to the future

As we look forward to Mace’s 25th anniversary year, we reflect on where Mace has come from and are excited for the opportunities of the future. We continue to find a better way for our clients. We continue to invest in our people, supply chain partners and our communities, while mitigating the impact of our operations on the natural environment.

Our pipeline of work for 2015 is 72% secured, with opportunities both in the UK and internationally. We aim to strengthen our presence in core markets while carefully expanding into new sectors, such as pharmaceuticals, data centres and our investment business will continue to take advantage of opportunities in support the Group’s 2020 objectives.

We end 2014 in a healthy position and with a robust platform for steady, sustainable growth in 2015 and beyond.

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Corporate governance

Company structure

Mace Group Board

Consultancy Board Construction BoardInvestment Board

Talent & Development Board

Health & Safety Board

Strong, transparent and accountable governance safeguards the health of Mace. It enables the company to maintain its agility, entrepreneurial spirit and provide development opportunities for our people.

The Mace Group Board is collectively responsible for the direction and oversight of the company. The Board believes that good governance involves the clarity of roles and responsibilities and the proper utilisation of distinct skills and processes.

The Board is focused on the long term strategy and how we can continue to meet our clients’ ambitions, by structuring our business across three boards – investment, consultancy and construction.

The majority of the directors at Mace maintain client involvement and are renowned for their hands on approach, successful stakeholder management, delivery, and employee engagement. This allows them to better understand the complexity of our projects and consistently create value for our clients.

We remain committed to providing exceptional health and safety standards across all our projects. The safety and wellbeing of our people and the communities we work within is fundamental to who we are and everything we do.

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Sky Believe in Better Building, London, UK

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Mace Group Board

Mark Reynolds Chief Executive

Appointed Mace’s Chief Executive in January 2013, Mark has been a member of the Group Board since the management buyout of the company in 2001. His 2020 vision is for Mace to double its turnover to become a £2bn company by delivering a consistent high quality service to clients. Mark gained his early experience in the commercial sector on the Broadgate and Ludgate developments in London, later moving on to projects with the British Airports Authority. He was the Deputy Programme Director for the London 2012 Olympic and Paralympic Games, reported as the best ever delivered venue in the history of the modern Olympics.

Board tenure appointed 2001

Stephen PycroftExecutive Chairman

Stephen Pycroft is the Executive Chairman of Mace. Having joined the company in 1993 and appointed a Group Board Director in 1995, Stephen led a management buyout of the company in 2001 and was appointed Chief Operating Officer before taking over as CEO at the end of 2004 and Executive Chairman in 2008. He stood down as CEO at the end of 2012 after leading the company through a period of phenomenal growth with turnover increasing from £90m in 2001 to £1.09bn in 2012. He cemented Mace’s reputation as one of the leading international consultancy and construction companies with an enviable reputation for quality and delivery worldwide.


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Mark HolmesCOO for Consultancy

Mark joined the company in 1992 and set up Mace’s UK consultancy business. He was then instrumental in adding cost management and facilities management to our consultancy offer. More recently, Mark has been developing the company’s corporate real estate partnerships and entry into North America. Mark chairs Mace’s Consultancy Board.


p.68

Gareth LewisCOO for Construction

Gareth has a wealth of experience, with more than 25 years in the construction industry, joining Mace in 1994. He specialises in running complex projects and programmes bringing high quality delivery and innovation to clients.

Since becoming Chief Operating Officer of our construction business, turnover has grown to over £1.2bn, contributing 81% of Mace’s turnover in 2014. Gareth also oversees management of the construction supply chain and provides strategic leadership on many of the UK’s most iconic construction projects. He won the Construction Manager of the Year Award in 2013 and is a fellow of the Chartered Institute of Building.


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Marcus BurleyCOO for International

Marcus is responsible for the company’s operational activities internationally. He currently manages in excess of $US20 billion worth of projects. Marcus has more than 20 years of industry experience and has been responsible for the successful completion of major retail, commercial, leisure and residential projects around the world. Marcus has played a key role in securing and subsequently developing successful partnering and joint venture agreements with three of the Middle East’s largest and most respected developers.


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Mace Group Board contd.

Mark CastleDeputy COO for Construction

Mark joined Mace in 2005 to set up the company’s fixed price construction business. With over 30 years’ experience, Mark has managed UK and USA based organisations and today retains a hands on approach to many of our strategic client relationships. He is a fellow of the Royal Institute of Chartered Surveyors and a Director of the UK Contractors Group.


David GroverCOO for Investment

David has over 30 years’ experience in client project and development management, property and investment and is the director responsible for Mace’s investment activities. He currently works with clients to bring development opportunities to life through creative investment, shaping Mace’s core consulting and construction services. David has a degree in quantity surveying and a masters in construction law and arbitration. He is a member of the Chartered Institute of Arbitrators and the Royal Institution of Chartered Surveyors.


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Jason MillettCOO for Major Programmes and Infrastructure

Jason is responsible for Major Programmes and Infrastructure (MP&I) and is driving our goal to be the UK’s leading programme manager by 2020. He has over 20 years’ industry experience and leads on some of the UK’s most significant projects alongside the largest global programmes. Under his leadership, MP&I has seen 43% growth over the last 3 years.

He was CLM’s programme director for the London 2012 Olympic and Paralympic Games, responsible for the delivery of the Games venues and the commercial closure of the most successful Olympics ever.

Prior to joining Mace he was CEO of Bovis Lend Lease while also holding the role of CEO of Catalyst Lend Lease.

Jason is an advisor to the Mayor’s London Infrastructure Delivery Board, a fellow of the Chartered Institute of Building and the Association of Project Management.


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Dennis HoneGroup Finance Director

Dennis is Mace’s Group Finance Director and leads the corporate services division responsible for finance, human resources, legal, marketing, communications and information management. He has extensive experience in senior corporate leadership.

Prior to Mace he was the Director of Finance and Corporate Services and later the Chief Executive of the Olympic Delivery Authority. He was involved with the development and delivery of London 2012 transitioning to being the Chief Executive of the London Legacy Development Corporation leading the transformation of Queen Elizabeth Olympic Park.

In 2013 he was awarded Commander of the Order of the British Empire (CBE) and more recently the Freedom of the City of London.


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Lee PenlingtonGroup Commercial Director

Since 2010 Lee has held overall commercial responsibility for a number of Mace’s construction businesses, and in particular the formation of a residential service offer. He is founding director of the Como business, Mace’s specialist and leading fit out company. He started out in the construction industry in quantity surveying. Lee joined Mace to establish the fixed price offer within the Group, and led the commercial team to successfully deliver numerous projects within both the public and private sector.


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About Mace

How we create value

Pursuit of a better way is at the heart of everything we do, from collaborating with clients to offering dynamic services. It is this approach that helps us create value.

OUR VALUES

Safety first. Second nature. Integrity Client focus

Opportunity Pursuit of a better way One Mace worldwide

LONG TERM BUSINESS GOALS

Be the company of choice for clients, trusted to deliver Provide opportunities for our people to grow and develop

Grow the business in a planned and sustainable way Retain our spirit of collaboration and ‘pursuit of a better way’

SECTORS GEOGRAPHIES SERVICESp.19p.23p.19

CREATING VALUE FOR CLIENTS

Delivering safe and sustainable outcomes

Developing new partnerships and strengthening existing ones

p.50Strengthening presence

internationallyp.58

Growing portfolio of infrastructure programmes and public sector

frameworks

p.68

p.70

p.48

p.80

Focused on being a smart provider of integrated services

across the whole project life cycle p.54

Expanding sector or service offer in targeted growth markets

(property, infrastructure, mining and oil, gas and energy)

p.50

Driving new industry innovations and efficiencies

p.54Successful delivery of programmes and projects on time, below budget,

safely and to the highest quality

Investing in training and development for employees

p.52

p.78

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About Mace

Our services and sectors

Invest Consult Construct Operate

Programme managementProject managementMace Cost Consultancy

Architecture and engineering

BIM

Construction design and management regulations

Information and communication technologies

Risk

Sustainability and socio-economics

Construction deliveryFit out (Como)

Contracting

Logistics (Mace Logistics)

MEP (Mace MEP)

Preconstruction

Secure construction (MSecure)

Facilities management (Macro)Managed services

Facilities management consultancy

Helpdesk services (fm24)

Investment

Development management

Real estate

Our services

Our sectors

Arts and culture

Data centres

Education

Energy and utilities

Government and public estates

Health and social care

Hotels

Industrial and manufacturing

Leisure and sport

Offices

Regeneration

Residential

Research and pharmaceutical

Retail

Transport

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2 2014 at a glance

2014 at a glance

Our highlights

People highlights

of our graduate intake being women.

519

34%+12%

4,657We created

...to make us a company of

This represents a growth of …with

on 2013...

new jobs in 2014...

Health and safety highlights

29% 40,151We continued to out-perform the average industry standards with a

There were

safety observations across our sites using our bespoke YellowJacket platform.

reduction in lost time incidents on site.

Our commitment to safetyp.48 Opportunityp.52

Financial highlights

£1.49bn£35m 72%

Mace had a strong year with turnover increasing by 26% to

...and pre-tax profit rising 8% to

of our turnover target for 2015 was already secured by the end of 2014.

Corporate responsibility highlights

Mace volunteers supported a range of community initiatives…. hectares of new community spaces.

850 4.2to charitable organisations and our six strategic partners.

In its second year the Mace Foundation has made total donations and contributions of over

...and created

£394k

Financial reportp.64

Acting responsiblyp.56

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Headcounts include consultants and temporary employees

NYC LDN

JHB

DXB DOH HKG

Group Total (end of 2014)

131% of Group total

Asia Pacific

3%

Headcount

MENA

553% of Group total

12%

Headcount

Sub-Saharan Africa

105% of Group total

2%

Headcount

Americas

147% of Group total

3%

Headcount

UK

3,303% of Group total

71%

Headcount

4,657Headcount

2014 at a glance

Our international presence

418% of Group total

9%

Headcount

Mainland Europe

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2014 at a glance

Delivering for our clients

Deaconess HouseEdinburgh, UK

In partnership with the University of Edinburgh, we completed the redevelopment of Deaconess House in 2014. Situated in the heart of the city centre campus, the project converts the former NHS Lothian headquarters into a 318 bed student accommodation complex. The project included the retention and refurbishment of the original Victorian Deaconess Hospital. Work completed on time for the start of the 2014 academic year.

Mandarin Oriental BodrumBodrum, Turkey

Turkey’s latest exclusive resort, Mandarin Oriental Bodrum, officially opened its doors to guests in summer 2014. Project managed by Mace, the hotel offers 86 guest rooms and suites and 23 apartments set in the resort’s landscaped hillside. This destination resort is poised to become one of Turkey’s most desirable addresses overlooking the Aegean Sea.

Mace worked closely with the client’s development management and contracting teams to successfully deliver this multi-million Euro development.

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Hong Kong Science Park Phase 3a + 3bHong Kong, SAR China

Mace was the executive project manager on the Hong Kong Science Park Phase 3a + 3b development, successfully delivering the first two phases over three years. The scheme is comprised of over 70,000 square metres of office space, laboratories and associated infrastructure. The Science Park includes Hong Kong’s LEED-CS v2009 Platinum rated office, which incorporates cost-effective and functional green building design and construction techniques. The success of this project can be attributed to the close collaboration with the design teams and sustainability consultants from inception.

Commonwealth Games GlasgowGlasgow, UK

Mace was commissioned by Glasgow 2014 to project manage the £27m transformation of Hampden Park, Scotland’s national stadium. The venue facilitated track and field events and the closing ceremony for the Games. Hampden was the only major construction project that Glasgow 2014 procured directly. Mace provided programme managers and schedulers to develop and manage the Commonwealth Games readiness programme. This guaranteed operational delivery in time for the event.

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2014 at a glance

Delivering for our clients contd.

National Gymnastics ArenaBaku, Azerbaijan

The National Gymnastics Arena in Baku is the first of its kind in Azerbaijan and will host international and elite level gymnastics and sporting competitions. It includes training facilities, auditoriums, administrative offices and has been built to world-class standards. Mace managed the design, procurement and construction of the 9,000 seat arena primarily in preparation for the 2015 Baku European Games.

Tiffany & Co. Worldwide

Tiffany & Co. is a multinational luxury jewellery and speciality retailer with approximately 300 stores worldwide. Mace has been engaged to provide both project and cost management services in the North American and European markets supporting Tiffany’s capital construction programme comprising new build, major and renovation projects.

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British Museum World Conservation and Exhibitions CentreLondon, UK

The World Conservation and Exhibitions Centre (WCEC) is a significant development for the British Museum to extend its capacity to safeguard and enhance its collections for future generations. The £135m project provides new storage facilities, a logistics hub and an exhibition centre in addition to conservation and science facilities. Mace, acting as construction manager, worked closely with the client to successfully deliver this project.

ColtEurope

Macro, our specialist facilities management company, has worked with the technology infrastructure company Colt to seamlessly manage 73 of their offices in 13 countries – covering over 230,000 square metres of office space. Colt made the decision in 2011 to move from a country based model to a consistent European approach. Macro helped Colt achieve their ambitions, improving efficiency and saving money.

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2014 at a glance


W4London, UK

Working for client The Crown Estate, Mace delivered the design and build of W4 on one on the world’s busiest shopping areas Regent Street, London. W4 provides 33,000 square feet of flagship retail space as well as a further 97,000 square feet of world class office space. Following its successful completion in 2014, the project has proved popular with retailers. American fashion brand J. Crew have signed up to take a 17,000 square foot unit, their first store outside of the US.

Sky Believe in Better Building London, UK

Home to the Sky Academy, the Believe in Better Building is the latest project to be completed as part of Sky’s masterplan. Mace provided construction and project management for the 3,600 square metre timber frame building designed to BREEAM ‘Excellent’ standards. This is the first of three state-of-the-art buildings Mace will deliver for Sky. The final two buildings, a mixed use office and studio known as ‘Building 2’, and a dedicated health and fitness centre, will complete in 2015.

The new facilities will bring together the thousands of employees working across Sky’s campus, providing a modern work space that will promote the well-being, creativity and productivity of its staff.

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240 Blackfriars RoadLondon, UK

240 Blackfriars Road is an architecturally striking, 19-storey tower located on London’s South Bank and within walking distance of Blackfriars South Station. It comprises over 200,000 square feet of modern office floors with stunning river views, street level retail units and residential space in ten private apartments located in an adjacent building.

The Mace project team delivered this building in a 3D and 4D environment, building on the BIM Model provided from the client throughout the design stages. Mace successfully delivered this project to BREEAM Excellent standards and delivered FSC Accreditation for client Great Ropemaker Partnership, a joint venture between Great Portland Estates and the BP Pension Fund, in 2014.

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2014 at a glance


Weston Library, University of OxfordOxford, UK

The £80m refurbishment of the iconic Grade II listed Weston Library provided a comprehensive upgrading of library infrastructure to create a modern facility for the safe and secure storage of the Bodleian Special Collections. Mace was appointed as main contractor to refurbish and enhance this building.

The transformation of the Weston Library into an exciting and dynamic resource for the University and the general public serves to better integrate the building into this wider location and encourage greater access and engagement for all.

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Al JazeeraLondon, UK

Al Jazeera appointed Como to deliver a world class newsroom and production studio within the confines of a standard shell and core office development on Level 16 of The Shard. Como delivered the complex technical fit out, which required the coordination and integration of specialist suppliers including data, broadcast cabling and control and set designers.

Bexley Civic Centre London, UK

The London Borough of Bexley appointed Mace as the main contractor to deliver the refurbishment of the council’s civic offices. Mace was responsible for the refurbishment of the 11,000 square metre 1980s office building in Bexleyheath which has been empty for five years. Work included the development of a 2,000 square metre new build extension, creating offices and a flexible suite of meeting rooms.

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2014 at a glance

Continued successes

Greenwich SquareLondon, UK

Mace is leading the way in meeting London’s acute housing needs by accelerating the supply and delivery of urgently needed and affordable new homes. At Greenwich Square, Mace is the principal equity investor and through a joint venture development company is delivering 645 high quality new homes, half of which are affordable housing, on Greater London Authority land. Over 300 homes are now complete and occupied, and a major new civic hub, featuring a library and leisure facilities, retail and a health centre set around a new public square is open to the public. As part of the development we are providing wider local benefits for the community, including employment and training opportunities and apprenticeships.

Porsche Cars North AmericaAtlanta, North America

Mace was appointed by Porsche Cars North America to provide specialist programme management services. The vision was to create a new corporate headquarters and also incorporate a world class experience centre with test track, business centre, five star restaurant, classic car display area and restoration centre, technical training centre and a data centre.

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AshghalQatar

Ashghal, Qatar’s public works authority, appointed a joint venture between Mace and EC Harris in March 2012 to deliver a major programme of social infrastructure building projects across the country. This five year project will address population and economic growth in Qatar as it looks to transform and sustain its own development, providing a high standard of living for its people for generations to come.

EC Harris and Mace have a long history of working in partnership on a number of high profile projects in the Middle East.

Queen Elizabeth Olympic ParkLondon, UK

Queen Elizabeth Olympic Park, located across 560 acres, is the city’s newest major park. The London Legacy Development Corporation appointed Mace to lead the post-Games legacy project, transforming the former Olympic Park into a community facility and tourist destination for future generations. The park features 100 hectares of green space and includes venues such as the Copper Box Arena, Lee Valley VeloPark, the London Aquatics Centre and the main Stadium. The south of the Park opened to the public in April 2014.

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2014 at a glance

Continued successes contd.

Silo DistrictCape Town, South Africa

Further to Mace’s successful role as project manager and principal agent on No.1 and No.2 Silo buildings, we are now providing programme management services for numbers 3, 4, 5 and the Grain Silo buildings.

This project forms a vital part of the development of the V&A Waterfront’s Silo District in Cape Town. It will include the reimagining of the historical old Silo building by internationally renowned designer Thomas Heatherwick into the Zeitz Museum of Contemporary Art Africa (MOCAA), the largest art museum in Africa.

No. 1 Silo was the first South African building to be awarded the 6 Star ‘As Built’ rating, demonstrating the client’s commitment to leadership in sustainability.

A14UK

Mace is providing programme management services on one of the UK’s largest highway projects, the A14 Cambridge to Huntingdon improvement scheme. The £1.5bn programme represents over 10% of the country’s total expenditure on road infrastructure. The programme will set a new benchmark for delivering large highway infrastructure projects faster and more efficiently. The road will be open to traffic by 2020.

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Kingdom TowerJeddah, Saudi Arabia

In a joint venture with EC Harris, Mace is project managing the construction of the world’s next tallest skyscraper, Kingdom Tower.

Located in Jeddah, the tower has a total construction area of over 530,000 square metres. On completion, this landmark building will stand over one kilometre in height and house a hotel, offices, apartments and boast the world’s highest observation area at 630 metres.

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2014 at a glance


South Bank TowerLondon, UK

South Bank Tower is nestled between two iconic London bridges, Blackfriars and Waterloo, and forms part of the ongoing regeneration of the South Bank. Mace is redeveloping this 31-storey building as main contractor, increasing its height by 11 storeys, remodelling the core to house 191 luxury apartments, and providing retail space and offices. Due for completion in early 2016, this transformation comes as a welcome change, offering a much needed injection of vitality to the area.

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Nova, VictoriaLondon, UK

Nova, Victoria is a high end development for Land Securities and part of the continued transformation of the Victoria area. Mace is principal contractor and project manager for this landmark development that includes approximately 83,000 square metres of retail, residential, commercial and community space.

The Nova, Victoria masterplan centres on a complete transformation of the public space, opening an attractive new route directly through to Buckingham Palace.

Thomas More SquareLondon, UK

Commercial property developer Land Securities appointed Como, our dedicated commercial fit out provider, to carry out a high specification fit out of over 90,000 square feet of commercial office space at Thomas More Square in the City of London.

The project valued at £27m included external redevelopment works and was delivered in a live working environment.

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2014 at a glance


The Tate Modern ProjectLondon, UK

Appointed as construction manager, Mace alongside the client and design team is working on the development of an 11-storey, truncated pyramid structure to the south of the existing Tate Modern building.

This iconic new structure incorporates three derelict underground oil tanks and half of a live switch station which has been specifically decommissioned.

The vision of the new building is to redefine the museum for the 21st century, integrating learning, display and social functions.

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Birmingham New Street StationBirmingham, UK

Birmingham New Street station is a complex, multi-phased programme set to increase passenger capacity in one of Britain’s busiest transport interchanges. Appointed by Network Rail as delivery partner and principal contractor, Mace is transforming the 1960s railway station into a 21st century transport hub. This complex programme involves the delivery of more than 50 work packages while the station remains fully operational. The station will open in September 2015.

CitrixWorldwide

Macro’s work with long-term client Citrix, a leading software company, has helped to support its strategy to enable new ways for businesses and people to work better. The team is responsible for the delivery of a seamless programme that standardises processes across the company’s European property portfolio.

In 2014, Mace assisted in establishing Citrix’s new offices in Denmark and the Netherlands.

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2014 at a glance

Securing future work

Newington ButtsLondon, UK

Mace is at the leading edge of residential Private Rented Sector (PRS) investment and delivery in the UK. As developer for the Newington Butts scheme in Elephant and Castle, Mace is delivering 457 high quality new homes in a 45 storey tower and eight storey terrace. This includes 278 homes for market rent and 179 affordable homes in partnership with Peabody.

This development has set a benchmark for future PRS schemes in the UK in partnership with public sector landowners. Mace is co-investing in partnership with Realstar, Canada’s leading privately owned real estate and management company, who are taking a long-term asset hold role in the scheme under the Mayor’s London Rental Standard.

Newington Butts has set a precedent for international long-term investment in the London housing market and provides an example for UK investment into the sector.

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Expo 2020Dubai, UAE

In a joint venture with CH2M, Mace will provide programme management services for all real estate and construction delivery for the Dubai Trade Centre Jebel Ali development – the master district that will host Expo 2020 Dubai. This high profile and prestigious development will become a new focal point of global business and tourism for the region, reinforcing the UAE’s position as an international destination.

Great Western ElectrificationUK

As part of Network Rail’s Great Western modernisation programme, Mace will act as delivery partners, overseeing the delivery of the electrification programme, including overhead line equipment along the 235 miles of track.

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2014 at a glance

Securing future work contd.

Silos Direct Encapsulation Plant Seascale, UK

Mace has been selected as preferred bidder with Sellafield Ltd for its Silos Direct Encapsulation Plant (SDP) project, as part of a joint venture. Mace, together with its joint venture partners, will take the project from detailed design, through to inactive commissioning. The project is an integral part of the waste retrieval and hazard reduction programme which is of strategic importance to the UK’s Nuclear Decommissioning Authority.

Oman Cultural ComplexMuscat, Sultanate of Oman

Mace was appointed as project and cost manager on the unique Oman Cultural Complex (OCC) in Muscat. The OCC will be the first of its kind in the Middle East, hosting three major buildings of national interest. The National Library with capacity to host 5 million volumes, the National Archives which will act as an archive store including a ground floor exhibition space with a research and administration wing, and the National Theatre, built to accommodate a thousand people.

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National GridUK

Mace has secured a place on the National Grid project support services framework. The three year framework will include work on M&E, building and civil work for a diverse portfolio of transmission and distribution programmes across the UK. National Grid owns the high-voltage electricity transmission network in England and Wales as well as a large proportion of the UK’s gas distribution network.

Heathrow Q6 FrameworkLondon, UK

Mace was appointed to Heathrow Airport’s £1.5bn Q6 framework – a programme of works over the next five years. This new framework includes all upgrade and maintenance work on a range of projects for terminals 3 and 5. These include the check in system replacement, the air bridge refurbishment and the upgrade of passenger areas.

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2014 at a glance

Securing future work contd.

Television CentreLondon, UK

In 2014 Mace was appointed to deliver the £400m redevelopment of the BBC’s former Television Centre in west London for developer Stanhope. This world famous building will be transformed into a major mixed use development, with a business hub for the creative industries, studio space for the BBC, Soho House, cinema, gym, restaurants and cafes, as well as 950 homes. Construction begins in early 2015, with phase one due to be completed and occupied by 2017.

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Liberty Specialty MarketsLondon, UK

London’s skyline is constantly evolving, reshaping the city of London. One of the newest landmarks is 20 Fenchurch Street, nicknamed the ‘Walkie Talkie’ due to its distinctive shape. Como were appointed by Liberty Specialty Markets to fit out the 120,000 square feet headquarters with new, high quality office accommodation and facilities. This was the largest of 11 fit out projects currently being carried out within the building.

Volkswagen Financial ServicesMilton Keynes, UK

Macro secured a three year FM contract with Volkswagen Financial Services (VWFS), who provides finance and insurance services to customers across the entire Volkswagen Group in the UK. Over the course of the three years, Macro’s role will be to provide a facilities helpdesk, reception, mailroom, security, cleaning and building and grounds maintenance.

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3 Our values

Our commitment to safety

We make the wellbeing of our people our top priority everywhere we work by nurturing a culture that lives and breathes health and safety.

Mace’s inaugural ‘Safety first. Second nature.’ AwardsAs our business grows, so does the number of live construction and project sites. For Mace, health and safety is not simply about compliance. The diversity of these projects has expanded into new sectors and regions, bringing new challenges and opportunities to the Group. We positively recognise safety excellence and innovation across our business, supply chain and clients.

In 2014 we increased our positive recognition efforts further, by introducing a ‘Safety first. Second nature.’ Awards programme. The awards celebrate the outstanding contributions made to health and safety by our people, partners and stakeholders. The 13 categories covered innovation, design, individual and team excellence, and best practice from our supply chain and clients.

Safety excellence in AzerbaijanOur team based in Azerbaijan has taken positive strides to promote best practice in health and safety across their projects. Taking home the Outstanding Achievement – International category at the ‘Safety first. Second nature.’ Awards, the team has brought new initiatives to the 1,100 strong regional workforce, from Health and Safety Executive (HSE) communications to supply chain events and local awards to recognise safety best practice.

YellowJacket Across multiple projects, influencing contractors and keeping track of health and safety, quality and environmental data in real time can be hugely challenging.

YellowJacket is used to manage performance across our projects and supply chain. In 2014 this software was made available as a mobile app to make it even easier for our teams and stakeholders to use on the go.

We achieved

hours without a reportable accident across the business.

6m

Through our safety partnership programme we engaged directly with

of our leading subcontractors.

This initiative will be rolled out further in 2015.

23In 2014 we achieved an Accident Frequency Rate (AFR) of

0.09

Despite maintaining a workforce of over 10,000 on our sites, we achieved a

29%Utilising our bespoke YellowJacket platform, the number of observations across our sites went up

from 31,352 to 40,151.

28%

year on year reduction in lost time incidents.

2014 highlights

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Outstanding health and safety practices on siteWe work to promote the highest standards of health and safety across all of our sites. In 2014, the Birmingham New Street Station project team delivered a training day in five different languages to cater for the site’s diverse workforce. The sessions, which took place in the project’s landmark new John Lewis department store, saw 180 operatives briefed on pre-use inspection and emergency descent procedures for mobile elevating work platforms (MEWPs).

Due to the nature and complexity of this project, standardising health and safety practices and skills for suppliers is an area of particular focus.

“Health and safety and workforce engagement is of the utmost importance to us at Sky, and it is a pleasure to work with Mace who continually strive to make sure we achieve our common goal of health and safety excellence.” John Nicholson Programme Director at Sky

CLOCSCLOCS (Construction Logistics and Cyclist Safety) is the first UK national standard designed to help reduce collisions between construction vehicles and vulnerable road users such as cyclists, pedestrians and motorcyclists. Mace signed up to the CLOCS programme and championed it at our sites throughout 2014, making us one of the first construction companies to demonstrate its commitment to this standard.

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Client focus

CRM leadershipAt Mace, client focus is about better understanding our clients’ challenges and coming up with solutions that will help achieve their ambitions.

As part of our client focus strategy, everyone at Mace has been given the opportunity to get involved in a refreshed customer relationship management (CRM) programme. We recognise that all of our people have a role to play in delivering a great service for our clients. That is why we have improved our CRM systems, clarified accountabilities and created a consistent CRM approach across our international business.

This approach also forms part of the Mace Way, our internal knowledge management system. Our commitment to our clients is reflected in our internal drive towards consistent processes and improved sharing.

Roche DiagnosticsRoche Diagnostics is a world leader in in-vitro diagnostics and offers a broad portfolio of tools that help with the prevention, diagnosis and management of diseases. Used by researchers, hospitals and laboratories worldwide, they help save lives. Mace provided project management, construction and safety management services on a five year global framework.

To efficiently and effectively deliver this project the Mace team was embedded within the client to create a seamless partnership. This allowed for an impressive blend of skills, knowledge and experience, demonstrating Mace’s client focus commitment.

Putting the client’s needs first and making the decision to work this closely with Roche meant that the team could achieve so much more. The integrated team managed the design and delivery of five concurrent projects, and established the client’s faith in Mace’s ability to translate a vision into reality using its integrated delivery expertise for the pharmaceutical sector.

Naturally there were challenges with this complex project, for example, work had to be done without disrupting regular operations or utility supplies on site. It was also being scrutinised globally – Mace had to get it right.

Client focus is a core value for Mace and remains at the top of our agenda. Mace’s 2020 vision is to be the company of choice for clients in our industry. In 2014, we focused on ways to develop our client satisfaction rating to ‘world class’ standard and strengthen our client relationships even further.

Percentage of clients rating us 4 or 5 out of 5

96% On relationship

88% Quality of service

92%Understand and recognise objectives

87%Responds to needs

85% Provides a timely service

84%Team well suited

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Successfully delivering this project not only provided the chance to help Roche with its property needs, but also gave Mace a strong foothold in what is a relatively new market for us. The team comprised of experienced managers, schedulers, project controls, and mechanical, electrical and cost control experts. The Mace team looks forward to working directly with more clients on technically challenging projects with integrated services.

Investing in research and development At Mace, we continually evolve our approaches and technology to provide clients with the best solutions to help them achieve their ambitions for the future. We pride ourselves on not being afraid to try new things and develop pioneering solutions to meet emerging client needs. As we move towards 2020 and our workforce grows we will continue to embed a culture of innovation and celebrating success.

During the 2014 financial year we continued to invest in our future through research and development, spending a total of £13m within Mace. These activities demonstrate our ongoing commitment to providing the very best service offering to our clients and staying ahead of the competition.

“Mace has become an extension of Roche’s team, helping us to achieve our ambitions for the future both in Europe and North America.” Roche Diagnostics

Research and development at Roche Diagnostics

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Opportunity

Developing and retaining our talentIn 2014, the Mace Talent Development Board agreed a framework to identify and develop people with the potential of becoming future leaders. This includes the construction trainee programme, graduate programme, Developing Success and Developing our Future programmes. Nearly 140 people have so far completed one of these courses.

These initiatives provide opportunities for our staff and champion personal development. They also encourage our new talent to further develop their skills and experiences to ensure they are well placed for a successful career at Mace.

Resourcing our global businessIn 2014 we increased our global resourcing efforts to further streamline international recruitment by creating a new global resourcing team. We also increased efforts to share best practice across the Group, improve site inductions and rolled out our recruitment and retention programmes globally to reflect changes in the market.

Reward and retention2014 saw the launch of a new employee benefits portal, providing easier access to internal vacancies and mobility information. We improved our appraisal process, introduced common policies across international borders, implemented new talent grids and improved workforce data to enable better planning for the future. We also improved our maternity and paternity benefits to make them one of the best in the industry.

Opportunity for allAt Mace, we are committed to promoting a wider diversity of talent across our business. We recognise that creating a diverse workforce will allow us to bring a wider range of perspectives to problem solving and ultimately create value for our clients.

Over the past year we had a particular focus on improving our gender balance. We increased the number of female

Our focus on delivery, innovation and client relationships means we fully embrace the challenge of attracting, developing and retaining the best people. Our people have the opportunity to work on some of the industry’s most high profile and challenging projects and programmes — all across the world.

2014 highlights

2013

2012

2014 34%

21%

10%

Percentage of women in graduate programme intake

+62%2014 employee survey results

87% 85%understand our vision, direction and communication...

feel proud to work for Mace...

85% 82%understand the ‘Safety first. Second nature.’ programme...

recommend Mace as a great place to work.

...and

...and we took on

young people recruited onto the graduate programme...

15–17 year olds attended our careers week...

of Mace’s 2014 graduate intake were women.

construction trainees.

58

24 18

34%

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employees to 28%, well ahead of the industry average. In 2014 Mace also signed an industry pledge to make our workplace more attractive to women, which includes a ten point plan created by the Women in Construction and Engineering Campaign.

We have fantastic women working at all levels within Mace, including the two case studies below.

Katherine Costello, Graduate Commercial Manager

Having recently graduated from London Southbank University with a degree in Quantity Surveying, Katherine recently enrolled on Mace’s graduate development programme as a Graduate Trainee Commercial Manager.

Katherine says: “The graduate programme at Mace has given me the opportunity to be involved with many aspects of a project life cycle. It’s given me confidence and made me feel supported in my development. Mace is now funding my RICS chartership to continue my development.”

Polly Priday, Project Manager

In 2014 Polly was one of the project managers involved with the Battersea Power Station Preliminary Works – a £100m project which comprises brick repairs to the elevations, repairs to the four wash towers and the dismantling and reconstruction of the chimneys. Polly says: “By being myself and working hard, I am able to achieve anything I set my mind to at Mace. I wouldn’t trade in my hard hat for anything.”

“Mace’s graduate scheme creates a culture of excellence where I feel confident and supported in my development.” Katherine Costello Mace Graduate

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Our pursuit of a better way

Innovation for our clientsOur mission is to work with clients around the world to help shape cities and build sustainable communities for the future. We are changing the way our industry operates because we believe we have found a better way of turning our clients’ ambitions into reality.

Mace is committed to innovation and excellence. We are proud that our constant pursuit of a better way has resonated with our clients and is embraced by our people.

Small or large, complex or simple, we constantly strive to find better solutions to infrastructure and property challenges. From London to Hong Kong, and dozens of cities and communities in between, Mace is helping clients to develop and build facilities that meet the needs of the future. With experience working on some of the most iconic projects in the built environment, Mace continues to help shape skylines across the world.

One approach, multiple solutionsPrefabrication is the process of building components in a controlled, offsite environment. It utilises the long established benefits of the manufacturing industry to create lean, precise and right first time construction. Prefabrication can range from the intricate to the extensive, including: 100% prefabricated buildings, cladding and curtain walling panels, structural components or building services components.

At Mace, we tailor our approach to each project, looking beyond what is ‘typically’ prefabricated. Driving innovation into the process creates better solutions.

A14 Cambridge to Huntingdon Improvement SchemeCambridgeshire is one of the fastest growing regions of the United Kingdom in terms of population and economy. Between now and 2023 the population of the area is expected to grow by 23%, driving a 22% increase in jobs. To help meet this future demand, in autumn 2013 the UK government and Highways England proposed a bold £1.5bn scheme to improve 21 miles of the A14 highway between Cambridge and Huntingdon.

of government investment. vehicles use the road daily.

mile bypass across open country proposed as an outlet for traffic.

miles of dedicated facilities for cyclists, pedestrians and other users.

£1.5bn 85k

12 18

Our passion is to bring new, innovative and sustainable ideas to our projects and we have the insight and commitment to see them through for the benefit of our clients.

A14 key facts

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The scale of the scheme made it a Nationally Significant Infrastructure Project and as such, it required a Development Consent Order (DCO) to be granted by the Secretary of State. Mace integrated itself within Highways England, running the project management office, programme, the procurement process and the technical assurance of deliverables. This was a pioneering approach for both Mace and the client, with Mace providing the needed extra resource, skills and expertise to this large and complex scheme. This meant that the application for DCO could be accelerated, with the submission completed in half the time it would normally take, setting a new benchmark for major road infrastructure delivery. Pending planning approval, construction on site is scheduled to start by the end of 2016 and be open to traffic in 2020.

Sky campus, LondonThe Sky Phase 2 development includes a new office and broadcast production building, general office space and amenities, technical production rooms and studios. Mace is providing an energy centre and strategy as well as the shell and core, base build and fit out.

The ethos for prefabrication at Sky was to challenge traditional installation methods and pioneer a better approach. The prefabrication approach was reviewed at each stage of the procurement process with our supply chain. Through the use of 3D design and modelling, the manufacturing and installation drawings were fully coordinated. The drawings incorporated a modular assembly method utilising support frames, crucial for the installation to the building structure.

Mace clearly identified each of the off-site assembly arrangements. This allowed us to produce full details of the equipment systems and supports required to manufacture off site and deliver to site for installation. A total of 80 modules were needed in total, all delivered ready for use on the back of a lorry.

“Mace helped to deliver one of the UK’s largest infrastructure DCO applications in just 13 months – around half the time it normally would take. This is raising the bar for major infrastructure delivery.” Chris Taylor Director of Complex Infrastructure, Highways England

Proposed Huntingdon Southern Bypass, A14 Cambridge to Huntingdon improvement scheme

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Acting responsibly

Responsible programmesOur programme management roles in new nuclear and highways schemes have provided a platform for us to develop and deliver responsible procurement programmes on a significant scale. Working with leading clients such as Highways England, EDF Energy and Sellafield Ltd, we are committed to providing maximum opportunities for local suppliers, local people and generating best sustainable outcomes.

Working with suppliersIn support of our Mace Business School members, we developed a new complement of refreshed sustainability training. These bespoke sessions focus on key risks and opportunities in construction delivery, and also provide a forum for our suppliers to work with us to develop innovative new solutions.

Sustainability skills forecastingTowards the end of 2014, we were commissioned by HS2 to undertake a detailed review of skills availability, specifically in the context of delivering HS2 programme sustainability objectives. This review includes quantification of required capabilities, a gap analysis of market readiness and recommendations for how best to advance skills availability and address potential shortfalls.

Building partnerships, planning for the futureBeing able to influence groups to work together has been a great way for Mace to make an even bigger impact for the charity sector. The Mace Foundation strives to facilitate collaboration between its strategic partners to advance community outcomes.

The Mace Foundation introduced Coram to property charity LandAid, who funded the development of Coram’s ‘Youth Zone’ in the new Creative Pears Pavilion which houses art and music therapy for young people aged 14 and over. Also, WheelPower held discussions with Teenage Cancer Trust about

...and created

volunteers supported a range of community initiatives….

The Mace Foundation donated The Mace Foundation supported

hectares of new biodiverse community spaces.

to charitable organisations and our six strategic partners.

850

£394k 16

4.2

Mace Foundation funding in 2014

Donations

£153kStrategic partnerships

£116kMatch funding

£125kCharitable donations

Fundraising

vulnerable young people in London in partnership with Coram.

Mace is committed to upholding high ethical standards in all our operations, everywhere in the world. We lead by example and act responsibly to make a positive contribution to our communities.

2014 highlights

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hosting a sporting event at Queen Elizabeth Olympic Park for young people who are in remission from cancer.

A focus for 2014 was on encouraging even greater involvement of Mace people, suppliers and clients and in support of this, the Foundation team has grown.

Engaged employees make a differenceEmployee engagement is central to the delivery of the Mace Foundation strategy and our people are at the heart of this. One of the ways our people take part is through the match funding scheme. Mace teams have raised funds by rowing the English Channel, running marathons, cycling hundreds of miles, taking part in Tough Mudders around the UK, jumping out of aeroplanes, raffles, quiz nights and forming rock bands. In 2014, £116,000 of match-funding was awarded to charities in support of the fund-raising efforts of our people.

Working together this way has helped to deliver the vision to become a leading and effective charitable company that creates opportunities, generates potential and supports disadvantaged people and local communities.

Coram Coram has been supporting vulnerable children in the UK for 275 years. Today, they help over a million children and young people annually.

The Mace Foundation supports Coram’s Supported Housing programme. The programme provides young people with a bedroom in a specialist supported house. They share facilities and learn how to manage their everyday domestic issues responsibly. As well as emotional support and counselling, they also receive help with how to manage their finances, find employment, further their education and, in time, move on to full independence.

The Foundation’s four-year partnership includes an annual donation of £20,000 to support young care leavers aged 16–25 and those who are at risk of homelessness. This, together with additional fundraising, has made a massive difference to the lives of 16 vulnerable young people in London in 2014.

“The Mace Foundation has now raised over £70,000 for Coram. This contribution will help many young people transition from a lifetime in the care system and take their first steps into independent living.” Alice Lamb Senior Corporate Partnerships Manager, Coram

“It is a great pleasure to work with the Foundation to support these great causes and to draw on the enthusiasm and expertise of our Mace colleagues to make meaningful and sometimes transformational contributions.” Michael Hanson Chief Executive Officer, Mace Foundation

Time to Shine event, London 2014

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One Mace

Streamlining systems for service As we continue to grow both in the UK and in our international hubs, it becomes ever more important that we ensure our unique approach, which our clients embrace, is maintained.

We have continued to invest time and money to refine our business processes and systems to ensure that we are all operating to the same standards globally, following the very best practice in our operational business.

Within the organisation the ‘Mace Way’ management system is a tool created to bring together all processes and approaches for each sector of the business. This promotes value for our clients, global consistency, knowledge sharing and efficient ways of working.

Working consistently also enables us to offer integrated global services to clients both in the UK and internationally. We all use the same approach. Our local teams understand the dynamic of their region and markets which means they know how best to implement our way of working and approach to projects.

GSKWe have been working with GlaxoSmithKline (GSK) for more than 15 years, providing project management and construction delivery services on a number of varied projects, including the flagship headquarters, other commercial offices and technology facilities across the globe.

As one of the world’s leading research-based pharmaceutical and healthcare companies, GSK’s success depends on a vibrant and dynamic research and development function to bring new medicines, vaccines and other healthcare products to market safely and cost effectively.

World-class scientific facilities are absolutely essential for this and so GSK is upgrading and expanding its core R&D sites to keep them at the cutting edge. They asked Mace to help put a rigorous programme in place to ensure success.

Working as part of an integrated GSK team, Mace programme management experts create a coherent structure, scope, cost and master schedule to govern the individual projects before any construction starts. Sites are spread across the US and UK.

> Continuous improvement >

ActPlan

Do

Check

ISO9001 certified management system

KNOWLEDGE AND EXPERIENCE INPUTS

Mace communities Industry best practice

Mace group forums Industry experts

Mace employees Nationally recognised schemes

BENEFITS FOR OUR CLIENTS

Guarantees the high level of service our clients expect from Mace.

Ensures knowledge sharing and lessons learnt from projects across

Mace are implemented on our projects.

Provides a consistent Mace approach across every project.

Provides a solid platform from which to tailor bespoke client-specific

processes.

Provides a clear view and understanding of how we

deliver our services and what clients can expect.

We deliver a consistent, quality service wherever we are in the world. Using the Mace Way, we share knowledge across borders and capture valuable global perspectives.

The Mace Way

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Using the Mace Way allowed us to deliver to the same high standard across the globe.

Individual projects have been delivered by GSK, with activity overseen by a central programme management office (PMO) made up of GSK and embedded Mace staff.

The end result is that GSK retains control while benefitting from Mace’s unique knowledge and expertise in running complex international construction programmes.

“Mace has offered GSK a Rolls Royce service, centred on a fantastic team of professionals focused on achieving our objectives” Project Director, GlaxoSmithKline

GSK headquarters, London

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Recognition

We are pleased to have many of the industry’s most talented people – who innovate and pioneer new approaches – as part of the Mace team. Over the past year many of our employees and projects have been recognised by their industry peers, acknowledging the high quality of our projects, people and our commitment to delivery.

Construction Manager of the Year 2014In 2014, seven of our construction managers representing seven different projects were nominated for the Chartered Institute of Building’s UK Construction Manager of the Year Award. The entire group reached the finals. Project director, Tony Hughes, took Gold for his work at Commercial Road, London and project manager Charlie Bevan received Silver for his work on Chenil House, London. Taking the top prize, project manager Lee Hutchinson was awarded Construction Manager of the Year for the new build and refurbishment at St. Paul’s School, London.

“Lee led Mace’s site team for the construction of our new science building … I do not recall having worked with a better construction manager in 30 years in construction.” Hugh Muirhead Project Director, St Paul’s School

“This project has shown that by building the right team and co-ordinating efforts, amazing results can be achieved.” Lee Hutchinson Project Manager

Building magazine: Major Contractor of the Year AwardMace walked away with the much sought after Major Contractor of the Year 2014 Award, recognising our achievements as stand out contractor in 2014.

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“Debra’s passion for supporting the progress of women is now part of her DNA.” Gwen Rhys CEO and Founder, Women in the City

“These awards recognise and celebrate the excellence of the winning organisations and their employees in managing health, safety and environmental risks. What all of the Sword and Globe winning organisations share is a commitment and resolve to achieve the highest standards of health, safety or environmental management.” Alex Botha Chief Executive, British Safety Council

“Impressive performance in the past 12 months, with a particularly strong performance around workforce development and sustainability. It showed clear evidence of a strong vision and goals for the future – a business that knows where it’s going.” Award judges Construction News

Construction News: Construction Consultant of the Year AwardFor the second year in a row, Mace won the prestigious Construction Consultant of the Year Award. Mark Holmes, Chief Operating Officer for Consultancy, and Jason Millett, Chief Operating Officer for Major Programmes and Infrastructure, were presented with the award in a ceremony attended by over 1,200 industry leaders.

Women in the City Woman of Achievement Award 2014Debra Ward, Managing Director for Europe and North America at our specialist FM company, Macro, won the Women in the City Woman of Achievement Award 2014. Debra took home the FM and the Overall Award following the 12th Annual Women in the City celebration lunch.

COO for Construction, Gareth Lewis, accepts the Building 2014 Major Contractor of the Year Award

Mace picks up prestigious Sword of Honour AwardThe technology and renewable energy team won the British Safety Council’s prestigious Sword of Honour for their work at Project Fox. This marks the third time this business unit has won the Sword of Honour and the fifth time for Mace overall.

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4 Operating reports

Financial report

Dennis HoneGroup Finance Director

£1.49bnTotal Group turnover at end of 2014

+26%Group turnover increase on 2013

+8%Group pre-tax profit increase on 2013

2013

2011

2012

2010

2009

2014 £1.49bn

£1.18bn

£928m

£1.09bn

£726m

£851m

Group turnover

2013

2011

2012

2010

2009

2014 £35m

£32m

£23m

£28m

£19m

£21m

Group pre-tax profit

2013

2012

2014 £101m

£142m

£103m

Cash balances

In my first year as Group Finance Director, I am pleased to present a strong set of accounts for Mace and report a clear expectation of continued growth. This is an exciting time for the company as we continue to help our clients deliver a diverse portfolio of projects and programmes across the globe. We are also making good progress towards achieving our financial targets as set out in our 2013–2020 business plan.

Overall, Mace achieved a strong financial performance in 2014. Across the business we worked to consolidate our efforts and capitalise on the platform we have created for future growth. Turnover and profit rose by 26% and 8% respectively to £1.49bn and £35m. Cash balances were £101m at year-end and net assets were £47m. A significant achievement was that 72% of our turnover target for 2015 was already secured by the end of 2014. This means Mace is in a stable and strong financial position.

These results reflect both the strength of our long term client relationships, where we continue to win repeat business, and our success in winning new work, particularly multi-year commissions. This is underpinned by solid segmental performances, with consultancy contributing £287m (19%) of turnover and our construction division contributing £1.2bn (81%) of turnover. Increased activity in our investment business saw a contribution of £3.1m to Group profit.

Key to 2014 was our work to improve Mace’s governance, with structural changes at board level kicking off this process. This work will improve clarity of oversight and accountability across our operations.

We reviewed our business units and the structure and management of these areas, with a view to strengthening the Group and strategically positioning ourselves for 2015 and beyond. As part of this I am now responsible for the corporate services division at Mace, which includes human resources, legal, marketing, communications and bids, and information management. I believe that bringing these areas together will enable improved strategic oversight and enable better ways of working. It will also set a clear direction for these supporting functions so Mace can achieve its 2020 goals and ensure we remain on a path of steady, sustainable growth.

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We continue to build a more resilient business by increasing our focus on risk management and governance. Our strategy of increasing activity in the consultancy sector, whilst challenging our overheads, means that we have greater flexibility to respond to changes in the economy as they arise. Labour and subcontractor cost pressures have an impact on margins but our overall performance has remained strong as our financial results demonstrate.

The construction division continues to win new work with a focus on high value projects spanning a number of years. The strong pipeline of work gives confidence that the financial targets in the 2020 business plan will be achieved.

Internationally there have been challenges but the MENA region saw growth due to project wins and there are encouraging opportunities in North America and Sub-Saharan Africa.

As Mace grows, the Group Board recognises the need to ensure consistency of performance in pursuit of a better way across all of our projects and commissions and to ensure that the growth of the company is controlled and risk is managed.

The 2014 results, the secured pipeline of work, the focus on overhead costs and governance provide for a robust platform for future growth.

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Investment report

David GroverCOO for Investment

+100%£1bn

£500m2013

2014

Gross Development Value (GDV) of real estate investment positions

2014 has been a year of success for the investment business, building on the pipeline of opportunities created during the previous few years.

Our Assam Place student and mixed use scheme in London has gone under offer and now exchanged as an asset sale via Jones Lang LaSalle, receiving a very positive market response. We expect to dispose of this fully let asset in the first half of 2015, exceeding expectations on exit yield. This also demonstrates the strength of the product we have created and operated for the past 24 months as well as the covenant of our tenant. The building has been performing well since completion and Hult, the tenant, has now completed an extensive fit out and is fully trading.

We have completed the Deaconess House project in Edinburgh, which consists of 318 units on time and opened to university students ready for the 2014 autumn term. It has been well received by both the University, who forward purchased the asset in early 2013, and by the students themselves, who are now enjoying spectacular views of Arthur’s Seat. The standard of accommodation is excellent, reflecting our attention to detail and careful approach to creating our own unique offer in this sector.

In Glasgow, we have been working on our planning application for circa 600 student rooms as part of a wider masterplan on a large, four acre city centre site. This will include 345 units for private rental, 135 homes for sale, a 124 room hotel and around 60,000 square feet of retail space. This is set to be a substantial development in the centre of a thriving city. Work is expected to commence on site in late 2015 or early 2016 pending planning approval.

2014 has also seen a huge amount of progress at our Greenwich Square project, a site containing 645 new homes, a large leisure centre and mixed use retail scheme, doctors’ surgery and ancillary use. Phase one, which includes over 400 homes, completes in spring 2015. All homes have now been sold, early occupiers have already moved in and feedback from the local community and our land partner, the Greater London Authority (GLA), has been very positive. Work will start in late 2015 on the second and final phases of the project which will provide circa 200 more homes for sale approximately two years later.

+50%12

82013

2014

Headcount (direct employees)

*Investment headcount is included in the total UK Consultancy turnover on pg. 70.

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During the year we completed a forward fund deal on a substantial tower project at Elephant and Castle, known as Newington Butts. Our development business completed the land purchase contract with the GLA and our social landlord partner, Peabody. We then completed a forward fund and sale deal to Realstar, the established Canadian investor, who will own and operate the tower as private rental stock. This 45 storey tower will not only be a significant addition to London’s skyline but is also the first significant project to be wholly for the private rental sector on GLA land, another landmark success in this relatively new asset class for the company. Groundwork started in 2014 and we expect to have the tower complete by early 2018. Mace is acting as contractor and our special purpose vehicle (SPV) property company as turnkey developer.

Work also started on site at our residential scheme in Golders Green, a boutique 25 unit luxury apartment project. As development manager we have created the delivery deal including project finance to the land owner. Initial market feedback to the design and product type has resulted in forward sales of all 25 units. A promising start, underpinning the strength of the London market at the right price point and location.

2014 has been a good trading year for our investment in Great Northern Hotel at King’s Cross with partners Robson Asset Management. Trading figures continue to stabilise and with the rapid take up of office space in the wider King’s Cross development, we plan to exit the position fully in late 2015 or early 2016.

As our reputation continues to grow in the market, so does our pipeline and opportunity. Our investment into contracted development positions and opportunity now exceeds £1bn in forecast exit gross development value, a significant increase on the year with further growth envisaged across the UK.

Our strength in the student sector continues to expand and we now have secured additional land positions on a number of schemes around the UK. We are also negotiating significant strategic land deals and involvement in new masterplans which will enable further growth in the years ahead.

We do however remain vigilant. There has been potentially unsustainable housing price growth particularly in London over the past few years and with construction supplier inflation at its

highest for years, there is a need to be cautious. The regional UK markets are however improving, offering lower land entry prices, less delivery partner inflation and genuine margins that if the product, location and expectations are set correctly, these will provide our business with great opportunities in the years ahead.

We are well placed in the medium term both through established frameworks in London where we have a proven track record and also more widely across the UK, as we continue to support and contribute towards the Group’s wider 2020 vision and growth plans.

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Consultancy: Property report

Mark HolmesCOO for Consultancy

+13%2013

2012

2014 1,496

1,323

1,260


+8%2013

2012

2014 £190m

£175m

£160m

Turnover

Mace’s consultancy team made a strong contribution to the company’s growth in 2014, with revenues of £190m. This year we continued to focus on frameworks both in the UK and globally. It is particularly satisfying that 60% of our business is now serviced through these kinds of framework relationships. There was solid performance from our existing markets and wins in targeted new sectors.

In the private sector, new or existing frameworks were renewed with British Airways, Citibank, Osram, Thyssen, Deutsche Bank, Halliburton, BP and Nationwide.

We had increased success in the pharmaceutical sector where we extended our relationship with GlaxoSmithKline (GSK) to include programme management of its UK and US research and development estates. We also secured new commissions with Merck, Novartis and a five year framework with Roche Diagnostics.

Our work with public sector clients goes from strength to strength. We won a new framework with the Ministry of Justice, an eight year partnership with Hampshire County Council as well as continuing our work across a number of high profile projects for the Department for Education, including the Free Schools framework and the Priority Schools Building Programme. In the higher education sector, we won new frameworks with the University of Oxford, Imperial College London and built further on our existing relationships with King’s College London, University College London, the University of Birmingham and the University of Northampton.

We are providing a range of services on the Grade II listed Old Admiralty Building as part of the Cabinet Office’s programme to consolidate and modernise the UK government estate, as well as working on the reorganisation of 2 Marsham Street for the Home Office. We also successfully completed the Town Hall Complex Refurbishment for Manchester City Council.

In healthcare, we supported The Christie NHS Trust on a number of healthcare projects, including the Proton project and Young Oncology Unit (YOU). We also completed the Tottenham Hale Kidney and Diabetes Centre for the Royal Free London NHS Foundation Trust, the UK’s largest offsite renal unit.

Percentage of Group direct headcount and turnover

Turnover: 13%

Headcount: 36%

Mace

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Our business in North America doubled in size this year and our continued focus on delivering great customer service is paying off in the chosen markets of corporate real estate, retail and pharmaceutical. We also completed two notable projects, in Atlanta the new headquarters and experience centre for Porsche Cars North America, and in New York the new headquarters for the Port Authority of New York and New Jersey. Key clients over the year included Walgreens, Tiffany, Roche, GSK and a number of American financial institutions.

Consultancy work also increased with prestigious UK developers and investors including Grosvenor Estates, Land Securities and Legal & General, building on our past success.

Establishing long term frameworks has been an important aspect of the past year. We won a number of these frameworks confirming how valuable it is to build on key relationships. Existing clients continued to give us exciting opportunities and projects. We continue to deliver the new facility for Jaguar Land Rover in Brazil and have re-secured frameworks with Hackney Homes, Sainsbury’s, Nationwide and Microsoft.

Macro, our facilities management business, continued to grow, winning new commissions with Volkswagen Financial Services as well as growing its existing commissions with Citrix, Colt, Emirates Air Line, BG Group and Invesco in the UK. In North America we appointed a new Managing Director for Macro, Richard Hayes, and we wish him well in his new role.

As we look to 2015, our strategy will be to continue to seek growth through targeting CRE frameworks in the property sector for both public and private sector clients. There will inevitably be a slowdown in the UK construction market in 2015/2016 and these frameworks will enable us to maintain a continued level of growth in the highly competitive UK property market.

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Consultancy: Major Programmes and Infrastructure report

Jason MillettCOO for Major Programmes & Infrastructure

In 2014 we continued to expand our work in major programmes and infrastructure in the UK and internationally. The past year has seen our team strengthen our existing client relationships and build on our robust portfolio of projects and programmes. We brought new talent into our team to respond to an increasing demand for the service proposition we have established since launching the business unit in 2012.

I am pleased to report good progress against our two core objectives for the division: to help the Group achieve its goal to be a leading programme manager by 2020; and to capitalise on current market opportunities in the infrastructure sector in the UK. Our performance means we are in a strong position to achieve these goals by the end of the decade.

Revenue increased by 29% to £40m over the past year and we expanded the team by 27% to 437 professionals. We also focused on adding new capabilities to our overall service offer. Our goal is to continue to improve, to become a smarter and more integrated delivery unit. The creation of a commercial programme management team during 2014 has already resulted in improved communication, engagement and innovation for several of our infrastructure clients.

Three years since inception, we are now providing programme management and commercial services for many leading companies and governments. A highlight of 2014 was the completion and reopening of Queen Elizabeth Olympic Park to the public. This dynamic programme of work included mixed-use zones, 27 acres of public space, and the connections needed to realise the vision of integrating the whole park with the local community and economy. We are proud to have helped create a lasting legacy in east London following our work on the 2012 Games.

The transformation of Birmingham New Street for client Network Rail surpassed major milestones. We completed the station’s new roof and continued to deliver this complex project behind the scenes and with minimal impact on the station’s 150,000 daily passengers. The redevelopment includes a new retail destination for the city, anchored by a John Lewis department store which we have now handed over for fit out. This modern transport hub will see capacity for the station increase from 32 million passengers per year to 52 million and we look forward to unveiling the new station together with Network Rail in September 2015.

+29%2013

2012

2014 £40m

£31m

£28m

Turnover*

*MP&I turnover and headcount is included in the total UK Consultancy turnover on pg. 66.

+27%437

3432013

2014

Headcount (direct employees)*

Mace

70

While these schemes moved closer to completion, others are just getting started, as our pipeline of work remains solid. During the year we started work on the early planning stages of some of the UK’s most exciting developments. We continue to support Hammerson to take forward regeneration plans for Brent Cross in north London. We have also made substantial progress on the Great Western Electrification Project for Network Rail – our team are running the entire route clearance section through to Bristol Temple Meads. I am pleased that our efforts are helping Network Rail to balance technical requirements with the obligation to preserve the character and heritage of this Victorian railway. 2015 will see our planning turned into action, starting with the adaptation of some of Brunel’s famous railway structures.

Our work for the Highways Agency (now Highways England) continues to expand across major infrastructure projects. In 2013, work started on the 21 mile long A14 Cambridge to Huntingdon improvement scheme, the UK’s largest road project, and this continues to gather pace towards planning approval. As an accelerated programme, I believe we have set a new benchmark for the efficient delivery of large highway infrastructure projects. Other work includes PMO services for the Lower Thames Crossing, as well as supporting the continued roll out of Highways England’s Smart Motorways programme.

In 2014 we strengthened our position further in the nuclear sector on projects of national importance. We were selected as preferred bidder for Sellafield’s new £1.7 billion Silo Direct Encapsulation Plant (SDP) waste processing facility through the a.m.a joint venture partnership comprising Areva, Mace and Atkins. The appointment shows our continued ability to provide successful teams for nuclear decommissioning, building on our longstanding work for Sellafield. We also secured a further energy performance contract with the company.

Alongside our work in nuclear decommissioning, we also continued our work on the UK’s next generation of nuclear power. This included supporting EDF Energy’s Hinkley Point C power station through contract negotiations and procurement services. This is a defining project for the UK’s energy sector, and we are proud to have been involved. In addition, in the water sector we have secured the next phase of key contracts such as the Affinity Water five-year AMP6 Programme as well as works with Severn Trent.

2014 also saw us appointed to frameworks with some of the UK’s most significant infrastructure providers. Our transport business was successful in securing a wide range of positions across the Transport for London Programme Management Framework. The two-year framework contract will bolster our role of helping London’s transport services match the city’s global hub status. The appointment is a major opportunity to grow our transportation business over the next few years, in addition to our existing London Underground Ltd appointments.

Our energy and utilities team secured a position on National Grid’s three-year framework which will present opportunities to deliver a diverse range of transmission and distribution projects across the UK.

In 2014 I was invited to join as an advisor to the Mayor of London’s Infrastructure Delivery Board to provide strategic advice and services to support the delivery of the 2050 London Infrastructure Plan. This is a fantastic opportunity for Mace as we work to contribute to London’s future. We are keen to add our experience and insight to the infrastructure and utility challenges of the future, helping to strengthen the UK economy and its competitiveness.

Building partnerships and collaborating with clients and key stakeholders supported our approach throughout the year. Mace partnered with Centre for Cities, a leading independent think tank as part of a study into improving how UK cities deliver urban transport.

Looking ahead into 2015, we will take the lead role as programme manager for Dubai Trade Centre Jebel Ali Development as part of a consortium with CH2M. Working on Expo 2020 provides us with a great opportunity to export our expertise on complex large-scale developments and strengthen our capability in international programme management. We also plan to expand further into the UK infrastructure market and build on our track record of success.

Given that our success is built on empowering our people to deliver for our clients, we will also continue to focus on attracting the industry’s best talent to meet a growing and exciting order book and fulfil emerging client needs.

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Consultancy: International report

Marcus BurleyCOO for International

–1%1,283

1,297

1,002

2013

2012

2014


–6%£96m

£102m

£103m

2013

2012

2014

Turnover

While 2014 demonstrated a continuation of the improvement in the global economic climate which started in 2013, many markets still experienced significant challenges. Our turnover was £96m, with an international workforce of 1,283.

In 2014 our focus was on consolidating our position in primary markets and refocusing our efforts towards major programmes and repeat order business with serial developers.

We witnessed significant results on all four continents. After several tough years, our Western European business returned to profit, with Germany, Turkey and France delivering strong performances. Notable achievements within this region are the Mandarin Oriental hotel in Bodrum, Turkey and our ongoing work with The Ritz hotel in Paris.

In Asia our largest ongoing commission, Phase 3 of the Hong Kong Science Park, won the prestigious ‘Grand Award’ at the Hong Kong Green Building Awards, a great achievement for the client and our team.

Our team on the Nassau-based Baha Mar luxury hotel development again demonstrated outstanding performance for our client as they drive this world class facility to completion in early 2015.

Azerbaijan continues to represent a key market for Mace and our Baku team oversaw the successful completion and handover of the Baku National Gymnastics Arena in March 2014, in readiness to host the European Games in July 2015.

Sub-Saharan Africa remains a key growth market for our business and 2014 saw our continued expansion across the region. We successfully entered into new sectors, most notably transport with a commission by the Public Rail Authority of South Africa (PRASA). Continued growth in Angola and new opportunities in Nigeria and Ghana further reinforced our commitment to this region and emerging market share.

The Middle East is our strongest and most established market, with further growth in the UAE, Qatar and Saudi Arabia during the year. In Qatar, the growth of the Ashghal Public Works Authority commission now represents 35bn QAR (£6.23bn GBP) of projects under management and we continue to assist New Doha International Airport to deliver additional facilities to their new airport.


Turnover: 6%

Headcount: 31%

Mace

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Key appointments were secured with client Meraas on the ‘Dubai I’ and Marsa Al Seef developments and Al Reem Mall in Abu Dhabi.

Building on the success of 2013, India continues to demonstrate a good level of business growth, with our team increasing from 40 to 68 and additional commissions being secured through key clients. Our strategy remains to focus on key market leaders and international clients entering the Indian market.

As can be expected, some markets come with a higher level of uncertainty. Our major residential commission with SPb Renovation in St Petersburg was cancelled early in the year as volatile financial markets and increased political instability required a comprehensive product review by our client.

The amended UK Foreign and Commonwealth Office framework has, as anticipated, resulted in a reduction to the pure contracting opportunities available. However we continued to secure international consultancy roles with this long standing client.

Perhaps the greatest and most satisfying success of the year was securing the Dubai Expo 2020 commission in late November. It represents a long term, high profile commission, building on our London 2012 Olympic and Paralympic Games experience and international capability. The win provides a great platform from which to secure future global event commissions and to reinforce our service offering in the MENA region.

As the global economy continues to recover and grow, and with some notable major projects such as Dubai Expo 2020 and our increasing market presence in Sub-Saharan Africa, we are well placed to meet the challenges and opportunities of 2015 and beyond.

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Construction report

Gareth LewisCOO for Construction

+15%1,130

983

857

2013

2012

2014


+32%£1.2bn

£904m

£829m

2013

2012

2014

Turnover

I am pleased to report that our construction business has again recorded a strong financial year. We exceeded our targets, achieving £1.2bn in turnover, exceeding our 2020 goals. We were appointed to several excellent projects such as the former BBC Television Centre for client Stanhope and Heathrow Airport’s Q6 framework, and we continued to strengthen our team to prepare the business for new and exciting challenges in the future.

We continued to build on our solid relationships with clients, resulting in a healthy stream of new business that will ensure our financial performance continues to grow. Encouragingly, the UK construction market started to recover during the middle part of the year, putting us in a strong position as we move into 2015.

The redevelopment of the former BBC Television Centre is a £400m project that will transform the original iconic building into a major mixed used business hub for creative industries. It will include recreational facilities and 950 homes in west London.

Mace’s work on the lasting legacy of the 2012 Olympic and Paralympic Games continued as we were appointed to deliver part of the East Village for Qatari Diar Delancey. The development will include a number of high rise buildings, 481 residential units and retail and leisure space. We plan to start on site in July 2015 with completion of the scheme currently scheduled for early 2018.

Continuing a relationship stretching back 20 years, we were appointed to the £1.5bn Heathrow Q6 framework to continue a programme of works at the airport over the next five years. This will include all development work and maintenance upgrades on Terminals 3 and 5.

The London residential sector remains buoyant with projects such as Merchant Square for European Land, hollandgreen for Chelsfield, Silchester Garages for Peabody, Vauxhall Sky Gardens for Fraser & Co, Grosvenor Crescent for Wainbridge Estates Belgravia Limited, and City University for UKSA City University Sarl. Securing a strong presence in this sector, we were also appointed to a £500m framework with One Housing Group, a leading provider of housing care and support across London and the South East of England.


Turnover: 81%

Headcount: 27%

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Mace was able to capitalise on an upturn in the commercial sector by securing commissions such as Fetter Lane for Great Portland Estates, Sloane Street for Cadogan Estates and Grafton Street for O&H Properties, all located in London. This follows the excellent work done at W4, Regent Street for The Crown Estate. We are currently working on its £50m sister project W5, which is scheduled for completion in 2015.

For Como, our specialist fit out business, key projects include EY, Quintain and PRS for Music. Como is also working for Liberty Specialty Markets fitting out six floors in the Walkie Talkie building, a new addition to London’s skyline. Completed projects in 2014 also included work for well known global corporates Google, Burberry, Microsoft and UBS.

We have progressed a number of important and iconic projects. We made progress on the groundbreaking redevelopment of the iconic South Bank Tower in London for client CIT Group, which includes the addition of 11 storeys and residential space. The development will provide local jobs and vital regeneration to the Southwark area.

Other large projects under way include Nova, Victoria for Land Securities, 7–10 Hanover Square for Aelton Limited, Sky’s Building 2, the 115,000 square foot One Bedford Avenue and the cutting-edge Tate Modern.

We saw a number of projects successfully completed this year, including The Place (£146m) for Sellar Property Group, Assam Place for Aldgate Developments Limited (£28m), Three Quays (£80m) for Cheval Group and the £135m World Conservation and Exhibitions Centre for the British Museum where we were privileged to contribute to the development of the Museum’s future.

As a team, one of our main objectives was to enhance value and consistently deliver quality. We looked at structures, processes and new approaches to develop a team capable of taking construction forward at Mace. We started to fully embrace new technologies using it smartly on all our projects, particularly at the early stages of the project life cycle.

As a result we placed emphasis on building technology capability across the team. This, along with combining our efforts to continue to develop our MEP, logistics and prefabrication offerings, has developed the expertise we need for the future.

Project Fox, a UK data centre for a major retail bank, won the British Safety Council’s prestigious Sword of Honour, achieving the highest score of any construction organisation. Led by our technology and renewables team, we are proud of their efforts to maintain the highest standards of health and safety on site.

Our technology and renewable energy business continued its growth in the renewable energy market, with the recent appointment as the delivery partner to Broadcrown to construct their UK roll out programme of community based waste to energy facilities. The first plant in Wednesbury, UK, will provide around 5MW of electricity to the local community and is expected to be completed in 2018.

2014 was a year of accolades. We were awarded Major Contractor of the Year by Building magazine, and were named finalists in the Contractor of the Year award from Construction News magazine. Three of our construction managers received commendations from the Chartered Institute of Building (CIOB) with Lee Hutchinson winning the overall CIOB Construction Manager of the Year prize for his work at St Paul’s School, London. Deloitte Real Estate also named us as the leading contractor in the commercial office sector for the third year running.

Our long term pipeline is strong and we anticipate an increase in new projects over the next three years as we expand our capabilities and tailor our service offer.

We have expanded the breadth of sectors in which we work, making us more resilient and prepared for possible future changes to the market and wider industry. We continue to enhance our teams, putting the best talent in place who are able to harness new technology and create the cutting edge solutions our clients demand.

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Health and Safety report

Nigel ColeHealth and Safety Director

+28%Actions recorded on YellowJacket

31,352

40,151

35,916

2013

2012

2014

–29%Lost time incidents on site

57

81

123

2013

2012

2014

–38%First aid incidents on site

110

179

329

2013

2012

2014

As one of our core values, we aim to embed a culture of safety at Mace. Although 2014 had a challenging start, we have performed well overall. Further reductions in incidents, despite an increase of people working on our sites, demonstrates that our overall approach of improvement is working.

Our ‘Safety first. Second nature.’ strategy, launched in 2011, aims to embed industry-leading safety practices throughout Mace. We understand that if we are to reduce and eliminate harm we must continue to improve and evolve our approach to safety. The strategy has made a positive impact, with significant reductions in accidents and incidents since its launch.

In 2014 we focused on the development of a strong culture of safety across our business, taking into account the dynamic nature of our operations and our growing portfolio of projects across the globe. We paid particular attention to improving safety data collection, using our ‘Observe. Engage. Improve.’ campaign and our unique safety reporting tool, YellowJacket, to increase our recorded observations. Further, we focused on translating observations into prompt action to prevent accidents before they occurred.

We took further steps to enhance our systems and processes, creating common policies such as tool tethering and safe use of Mobile Elevating Working Platforms (MEWPs), and educating both our staff and supply chain on safety issues. Our aim is to improve safe practice through communicating what good looks like more clearly and simply. We also refreshed our on-site induction and training programmes for our staff and supply chain partners to increase understanding of safe working practices and engagement with our safety culture. We continued to engage with our supply chain partners through our innovative in house Business School at our London headquarters where we run targeted training aimed at increasing understanding of, and commitment to, our safety culture.

A highlight for me over the past year was our work to positively recognise safety excellence across our business. In October we held our inaugural ‘Safety first. Second nature.’ Awards to recognise the outstanding safety leadership and initiatives across our teams, individuals, supply chain and clients. The Mace team in Azerbaijan secured the international team award for their outstanding approach to safety, while Sky’s Believe in Better Building project was awarded the Supreme Partnership

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Award for outstanding workforce engagement and for continually striving towards health and safety excellence.

Key 2014 highlights included:

• Achieving six million hours without a reportable accident across the business between April and July 2014.

• Total RIDDORs for 2014 were 24, up 3 on 2013.

• Ending the year with an Accident Frequency Rate (AFR) of 0.09.

• A 29% year on year reduction in lost time incidents on site, despite maintaining a workforce of over 10,000 on our sites.

• First aid incidents on site fell 38% to 110, compared to 179 in 2013.

• The establishment of an international safety leadership team which focuses solely on our international projects and programmes.

• Through our safety partnership programme we engaged directly with 23 of our leading subcontractors and this initiative is set to be rolled out further in 2015.

• Utilising our bespoke YellowJacket platform, the number of observations across our sites went up 28% from 31,352 to 40,151.

• There were no Health and Safety Executive enforcement actions recorded this year (including prosecutions and prohibition and improvement notices for breaches of health and safety legislation).

• Our public sector construction team achieved four years without a single RIDDOR accident – an excellent achievement.

While our ongoing commitment to safety is simply to ensure everyone can go home safe and well at the end of the day, we are proud that our safety efforts are being recognised and commended. The Mace technology and renewable energy team won the prestigious British Safety Council (BSC) Sword of Honour for their work on a data centre for a banking sector client, the fifth time Mace has received this accolade.

The project also achieved the maximum five stars in the BSC’s health and safety management audit scheme and received the highest score for a construction organisation at 99.68%. We were also recognised by the Royal Society for the Prevention of Accidents (RoSPA), where we received 11 Gold Awards for our construction, consultancy and Macro businesses.

Looking ahead to 2015

Our aim is to further embed our ‘Safety first. Second nature.’ strategy across the business by introducing stronger, more focused KPIs in construction and consultancy. Using our improved safety data, we have identified several targeted campaigns for the year ahead, covering logistics, fire, occupational health and electricity. We will also significantly increase our training and development and supply chain engagement activities.

As the company continues to grow both in its workforce and number of projects, we will continue to work hard to ensure that safety is at the forefront of all that we do. I wish to thank all of our Mace colleagues for their dedication over the year and all our clients and supply chain partners for supporting our safety agenda and helping to make Mace one of the safest companies in our industry.

77


HR report

Tracey LockeGroup Human Resources Director

Training and development spend

2013

2012

2014 £2m

£1.8m

£693k

2013

2012

2014 86.5%

94%

91%

Percentage of offers accepted

2013

2012

2014 4,160

3,806

3,327


4,657Total Group headcount at end of 2014 (includes consultants and temporary employees)

+12%

Headcount by service (direct employees)

Global Consultancy: 1,283 (31%)

Corporate Services: 240 (6%)

UK Consultancy: 1,496 (36%)

Construction: 1,130 (27%)

In 2014 we continued our focus on growth with employee numbers rising by 12% to over 4,600 across the globe by the end of the year.

Our activities focused on career development and succession planning, workforce diversity and the recruitment of highly skilled and qualified employees to support our 2020 goals. This was a strategic move to realise our ambition to have a global workforce of 7,200 by 2020.

Our success and ability to meet the needs of our clients in a complex and fast-changing business environment would not be possible without our people.

Through 2013/14 we have adapted our training and development offer to support the skills growth we need to realise our future vision and 2020 strategy.

In 2013 we created our Executive Development Framework (EDF) which comprises a number of programmes across all grades and disciplines to enable us to identify and develop our talent pipeline.

In partnership with Imperial College London, we offer two programmes: Developing Success and Developing our Future. 2014 saw the launch of Cohort 3 of Developing Success and Cohort 1 of Developing our Future which aim to grow our future leaders of people and projects. Imperial College is one of the top five ranked universities in the UK, and are thought leaders in our industry.

Also part of the EDF is our two-year graduate development programme which provides a strong foundation for successful careers at Mace and is recognised by top industry bodies. We increased our efforts internationally, with two graduates joining from South Africa and one from the USA.

We recruited 58 new graduates in 2014, to a more structured programme of training and development activity. The programme places a strong emphasis on developing the range and depth of individuals’ technical expertise, particularly in live project environments. As a result we saw our graduates work with a range of prestigious and high profile clients in the UK this year, including the Television Centre project, London Legacy Development Corporation, Metro Bank and the Priority Schools Building Programme. In 2014 Mace was also acknowledged

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78

as the highest ranked company in the construction and civil engineering sector for graduates to work for, based on feedback by Mace employees.

Our Construction Trainee Programme continues to provide a great foundation for school and college leavers to become the next generation of construction managers and this year we ran our second Careers in Construction week. This enables 15 to 17 year olds to experience the construction industry and learn about the different careers at Mace. This event plays an important part in attracting a continuing pipeline of new talent to Mace and the construction industry in general, last year 24 school and college students took part.

In 2014 Mace trained three internal staff to deliver accredited APMP project management training in house. This gives us much greater capability and capacity to train and accredit our project managers to the standards our clients and we expect.

In partnership with Cranfield University, Mace has also launched a new initiative to build our pipeline of skilled programme managers. This programme, Programme Managers of the Future, explores the challenges associated with working on complex and dynamic programmes, supporting and building up the knowledge of our professionals within this industry.

More widely we have introduced the Mace Career Map. This enables our people to see more clearly the potential career paths they might follow within the company. It identifies the role requirements in different job disciplines as well as helping people to see the development requirements of more senior roles.

Diversity is integral to both business success and achieving our 2020 vision. In 2014 we took positive steps to improve our workforce diversity as a company. We pledged our commitment to gender diversity through supporting the industry-led initiative, Your Life, and revamped maternity and paternity policies to support long-term careers at Mace. Although it is early days and we still have some way to go, our demographic data shows some positive indicators including an increased number of women in senior roles.

There were positive results in our most recent annual employee engagement survey with a 24% increase in the response rate. The Vision, Direction and Communication categories continue

to be the top scoring theme in the survey (87%) along with the new ‘Safety first. Second nature.’ section (85%). 86% of employees are happy to go the extra mile for Mace when needed it and 85% feel proud to work for Mace. Over 83% said they intend to be working for Mace in a year and 82% would recommend Mace as a great place to work. These results provide important data to inform our human resource planning and policies.

In order to improve our strategic focus on the people agenda, we took the decision to merge our Talent Development board with our People board. This ensures we have key senior leaders looking at our strategic priorities in an integrated way.

Looking ahead to 2015, our focus continues to be attracting, recruiting and retaining the highest calibre of talent as we expand and introduce new capabilities to the business. We have an exciting agenda which includes looking to explore new markets to attract talent, introduce a programme of middle management development and further increase our focus on employee diversity.

79


Sustainability report

Isabel McAllisterSustainability Director

In 2014 there was significant growth across our sustainability activities and sustainability delivery is now fully integrated throughout UK operations. We achieved many of our 2015 objectives a year early and delivered positive international results too, delivering exemplar built environments for our clients and receiving awards in recognition of our achievements.

The Mace Foundation and our work with communities also blossomed in 2014. We expanded existing successful programmes and pioneered industry firsts too. We were proud to sponsor Green Sky Thinking, a London-wide events programme for built environment and property professionals, highlighting innovative practice on how we ‘design in and deliver’ sustainability, and co-hosted more events with our clients. Green Sky Thinking provided a great platform to demonstrate some of our collaborative working.

Client services

Our sustainability consultancy offer continued to grow, and we established exciting and influential new roles with clients including EDF Energy and Horizon Nuclear teams, and Hammerson at Brent Cross, London. We also continued to deliver strategic sustainability investment and improvement programmes with existing clients such as the legacy programme at Queen Elizabeth Olympic Park, Royal Mail and Siemens.

In 2014, we expanded our sustainability service offer to include Post Occupancy Evaluation of commercial and residential buildings, with a view to helping our clients evolve their design briefs and building management infrastructure. We also quantified the benefits green buildings can deliver in terms of employee and resident well being and productivity.

UK construction best practice

We continued to work with selected clients, design teams and suppliers to deliver some impressive sustainable buildings in 2014. Achievements include:

• The 5 Broadgate team in London diverted 2,130m3 of timber from entering traditional waste streams and became the largest single user of the National Community Wood Recycling Project. This project creates employment from timber recycling where people learn joinery skills through producing furniture for resale. The 5 Broadgate programme created 6,000 hours of employment on Mace’s behalf which is equal to 785 days of paid employment.

Timber sourced from certified responsible sources

99.28%

94.32%

99.23%

99.19%

91.39%

94.32%

In situ concrete from BES6001 certified sources

64.36%Pre-cast concrete from BES6001 certified sources

Rebar from BES6001 or CARES SRS Certified sources

Structural steel from BES6001 certified sources

Plasterboard from BES6001 certified sources

2013

2014 75.97%

98%

FSC certified

2013

2014 23.3%

1.4%

PEFC certified

Bricks and blocks from BES6001 certified sources

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• The Sky Believe in Better Building’s cross laminated timber framed construction helped the building achieve net negative embodied carbon.

• At Battersea Power Station we developed a plan of works that accommodated resident peregrine falcons and helped deliver London’s highest breeding numbers for 12 years.

• We completed Foyles’ flagship bookstore on Charing Cross Road which won the BREEAM 2015 retail award, as the highest scoring retail fit out with 73.4%.

We also refreshed our Mace Business School environmental training, forming a new ‘how-to’ guide for sustainable construction, and developed workshops on logistics and responsibly sourced timber. More than 200 Mace Business School members attended training sessions in 2014 and a further 20 companies attended workshops. The intended outcome of the new training and workshops is that our suppliers will have an improved capability and understanding of sustainability in construction, thereby minimising risk and building more efficient, engaged and innovative project teams.

Community programmes

In 2014 our volunteering efforts continued to grow. More than 850 Mace people took part in a diverse programme of activities that included creating 1.5 hectares of new ecologically valuable habitats, helping hundreds of disabled children participate in sports at Time to Shine and The Seashell Trust, and giving young cancer patients experience of working in construction. We also cleaned up more than 4km of waterways in London, did a considerable amount of building and garden maintenance for organisations local to our projects, and staffed food banks at homeless shelters. The Mace Foundation also expanded its reach and awarded more than £394,000 of donations.

Corporate targets

We achieved almost all of our 2015 objectives a year early. These great results relied on the support of all our people and supply chain partners who I would like to take this opportunity to thank.

As our industry evolves, it is encouraging that we see so much enthusiasm for sustainability and innovative thinking in our people and clients. We now also have greater ownership of sustainability outcomes around the business,

with responsibilities for all roles and teams clearly defined, which will help ensure that we deliver even better results in future years.

Looking ahead to 2020

Work is underway to develop new targets to continue to challenge us until 2020. These will reflect the full breadth of Mace activities.

We are lead sponsors for the Green Sky Thinking 2015 programme, and will continue to work with clients to share our experiences of how to successfully deliver a sustainable built environment. Specifically, we are showcasing British Land’s new refurbished headquarters, The Crown Estate’s Regent Street portfolio, the completion the transformation at Queen Elizabeth Olympic Park and Sky’s Believe in Better campus.

In 2015 we are taking a lead role as programme managers for Dubai Expo 2020, which showcases three global development sub themes – sustainability, mobility and opportunity. We continue to leverage on our experiences from large global programme delivery and look forward to the challenges of applying this learning in 2015.

2013

2012

2014 19.7%

19.3%

4.4%

Biodiversity increase in area on site

2014 42.28Mace

2013 Mace 39.77

2014 Industry avg. 35.89

2013 Industry avg. 35.10

Considerate Constructors Scheme average scores

2013

2012

2014 2.4t

3.15t

3.3t

Waste to landfill (per £100k spend)

2013

2012

2014

11.6m3

8.8m3

21.8m3

Water used (per £100k spend)

2013

2014

690kgCO2

619kgCO2

Carbon consumption (per £100k spend)

81


5 Annual accounts

The directors have pleasure in presenting their report and the financial statements of the Group for the year ended 31 December 2014.

Results and dividends

The consolidated profit for the year after taxation amounted to £34.9m (2013: £32.4m). The directors have paid dividends of £7.6m (2013: £16.4m). No further dividend is proposed.

Going concern

After making appropriate enquiries, the directors have a reasonable expectation that the Group and the company has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the company’s financial statements.

Financial risk management objectives and policies

The board considers the Group’s key elements of financial risk to be interest rate risk and credit risk. The board has reviewed and agreed the policies in these areas, and are satisfied with the controls in place. The group’s exposure to other financial risks such as price risk, liquidity and cash flow risk are considered to be low. The Board therefore considers the information relating to their financial management and policies to be immaterial for the assessment of the assets, liabilities, financial position and profit and loss of the Group. The situation will be monitored closely and the Board will react as, and if, there is need to.

Directors

The directors who held office during the year were:

Stephen Pycroft Mark Reynolds Mark Castle Amy Chapman David Grover Mark Holmes Dennis Hone (appointed 12 December 2014) Katherine Knight (resigned 31 May 2014) Gareth Lewis Jason Millett Rob Owen Lee Penlington Matthew Turner (resigned 3 March 2014) David Vaughan (resigned 12 December 2014) David Williams Mandy Willis (appointed 3 October 2014) Ian Wylie (non-executive)

Branches

The company has branches registered in the Republic of Ireland and Moscow in the Russian Federation.

Disabled employees

The company gives full consideration to applications for employment from disabled persons where the requirements of the job can be adequately fulfilled by a handicapped or disabled person.

Where existing employees become disabled, it is the Group’s policy wherever practicable to provide continuing employment under normal terms and conditions and to provide training and career development and promotion to disabled employees wherever appropriate.

Employee consultation

Arrangements exist to keep all employees informed on matters of concern to them and information on Group performance and prospects is disseminated widely.

Employees are encouraged to be concerned with the performance and efficiency of the Group and various profit sharing and bonus schemes operate to emphasise and reinforce this.

Research and Development

The company engages in research and development activities on projects on an ongoing basis in the course of delivering innovative solutions to our clients.

Directors’ indemnity insurance

The company provides a directors’ and officers’ insurance policy which was in place during the year and remains in force at the date of this report.

Directors’ responsibilities

The directors are responsible for preparing the financial statements in accordance with applicable law and United Kingdom Generally Accepted Accounting Practice.

Company law requires the directors to prepare financial statements for each financial year which give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that year.

In preparing those financial statements, the directors are required to select suitable accounting policies and then apply them on a consistent basis, making judgements and estimates that are prudent and reasonable. Applicable UK accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements. The directors must also prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business.

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84

Directors’ report

The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial position of the company and to enable them to ensure that the financial statements comply with the Companies Act 2006. The directors are also responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

In so far as the directors are aware: There is no relevant audit information of which the company’s auditor is unaware; and the directors have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to establish that the auditor is aware of that information.

The directors are responsible for the maintenance and integrity of the corporate and financial information included on the company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

Strategic Report

The business review, risks and uncertainties, and future outlook are located in the strategic report.

Auditor

Chantrey Vellacott DFK LLP has merged its practice with Moore Stephens LLP and now practices as Moore Stephens LLP. Moore Stephens LLP will be appointed as auditor for the ensuing year in accordance with Chapter 2 of Part 16 of the Companies Act 2006.

Approved by the board and signed on its behalf by

Eloise Mangan

Group Company Secretary

29 May 2015


85

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86

Independent auditor’s report to the shareholders of Mace Limited

We have audited the financial statements of Mace Limited for the year ended 31 December 2014 which comprise the consolidated profit and loss account, the consolidated statement of total recognised gains and losses, the consolidated and company balance sheets and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

This report is made solely to the company’s shareholders, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company’s shareholders those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company’s shareholders as a body, for our audit work, for this report, or for the opinions we have formed.

Respective responsibilities of directors and auditor

As explained more fully in the directors’ responsibilities statement, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board’s (APB’s) Ethical Standards for Auditors.

Scope of the audit of the financial statements

An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the company’s circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by directors; and the overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the annual report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report.

Opinion on financial statements

In our opinion the financial statements:

• give a true and fair view of the state of the Group and parent company’s affairs as at 31 December 2014 and of its profit for the year then ended;

• have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

• have been prepared in accordance with the requirements of the Companies Act 2006.

Opinion on other matters prescribed by the Companies Act 2006

In our opinion the information given in the strategic report and directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

• adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

• the financial statements are not in agreement with the accounting records and returns; or

• certain disclosures of directors’ remuneration specified by law are not made; or

• we have not received all the information and explanations we require for our audit; or

• the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies exemption in preparing the strategic and directors’ report.

PAUL FENNER (Senior Statutory Auditor) for and on behalf of MOORE STEPHENS LLP Chartered Accountants and Statutory Auditor

London

29 May 2015


87

Consolidated profit and loss account

Notes

Year Ended

31 December 2014

£000s

Year Ended

31 December 2013

£000s

Turnover: Group and share of joint venturesLess: Share of joint ventures’ turnover

1,507,357(20,905)

1,183,404(2,256)

Group turnoverCost of sales

2 1,486,452(1,357,874)

1,181,148(1,043,580)

Gross profitAdministrative expenses

128,578(96,122)

137,568(107,085)

Operating profit 4 32,456 30,483

Joint ventures and associatesShare of operating profit 5 13 590

Profit on disposal of development asset 8 2,600 1,000

Profit on ordinary activities before interestNet interest (payable)/receivable 9

35,069(209)

32,073277

Profit on ordinary activities before taxationTax on profit on ordinary activities 10

34,860(5,196)

32,350(8,550)

Profit on ordinary activities after taxationMinority interest

29,664-

23,800(287)

Profit for the year 29,664 23,513

Consolidated Statement of Total Recognised Gains and Losses Year ended 31 December 2014

Year Ended

31 December 2014

£000s

Year Ended

31 December 2013

£000s

Retained profit for the yearExchange differences on translation of foreign subsidiaries

29,664(891)

23,513-

Total recognised gains and losses relating to the year 28,773 23,513

None of the Group’s activities were acquired or discontinued during the above two financial years.

There is no difference between the results reported above and their historical cost equivalents.

The notes on pages 88 to 101 form part of the financial statements.

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88

Consolidated balance sheet

Notes

At 31 December 2014

£000s

At 31 December 2013

£000s

Fixed assetsIntangible assetsTangible assetsInvestmentsShare of joint venture and associates gross assetsLess share of joint venture and associates gross liabilities

1213

5,26722,039

33,976(33,939)

4,32519,065

1,605(1,523)

Investors share of net assets 37 82

Other investments 20,893 1,547

Total Investments 14 20,930 1,629

48,236 25,019

Current assetsCurrent asset investmentWork in progressDebtorsCash at bank and in hand

151617

35,00014,191

319,227101,066

-5,325

236,715142,030

469,484 384,070

Current liabilitiesCreditors: amounts falling due within one year 18 (455,898) (369,732)

Net current assets 13,586 14,338

Total assets less current liabilities 61,822 39,357

Long term liabilitiesCreditors: amounts falling due after one year 19 (15,160) (13,971)

Net assets 46,662 25,386

Capital and reservesCalled up share capitalShare premium accountCapital redemption reserveOther reservesProfit and loss account

2021212122

979176065

45,726

979176065

24,565

Equity shareholders’ fundsMinority interest

46,847(185)

25,686(300)

46,662 25,386

The financial statements were approved by the board of directors and authorised for issue on 29 May 2015 and were signed on their behalf by:


Mark Reynolds

Chief Executive Officer

Company registration number: 2410626

Dennis Hone

Group Finance Director


89

Company balance sheet

Notes

At 31 December 2014

£000s

At 31 December 2013

£000s

Fixed assetsTangible assetsInvestments

1314

16,28428,868

14,9138,659

45,152 23,572

Current assetsCurrent asset investmentWork-in-progressDebtorsCash at bank and in hand

151617

35,0005,774

247,08445,054

-5,080

195,38676,431

332,912 276,897

Current liabilitiesCreditors: amounts falling due within one year 18 (336,236) (271,778)

Net current (liabilities)/assets (3,324) 5,119

Total assets less current liabilities 41,828 28,691

Long term liabilitiesCreditors: amounts falling due after one year 19 (15,039) (13,943)

Net assets 26,789 14,748

Capital and reservesCalled up share capitalShare premium accountCapital redemption reserveProfit and loss account

20212122

9791760

25,733

9791760

13,692

Equity shareholders’ funds 23 26,789 14,748

The financial statements were approved by the board of directors and authorised for issue on 29 May 2015 and were signed on their behalf by:


Mark Reynolds

Chief Executive Officer

Company registration number: 2410626

Dennis Hone

Group Finance Director

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90

1 Accounting Policies

1.1 Turnover

Turnover reflects both long-term contract activity and invoiced consultancy work. In respect of long-term contracts and contracts for ongoing services, turnover represents the value of work done in the year, excluding VAT and trade discount, and includes amounts not invoiced. Income arising from consultancy services is recognised when a right to consideration has been obtained through performance.

1.2 Basis of preparation

The financial statements have been prepared under the historical cost convention in accordance with applicable United Kingdom Accounting Standards and legislation, except as disclosed in note 5.

1.3 Basis of consolidation

The Group reports its interests in subsidiaries using the acquisition method of consolidation and combines all of the assets, liabilities, income and expenditure within the equivalent items in the consolidated financial statements on a line-by-line basis.

The minority interests in the net assets of the consolidated subsidiaries are identified separately from the Group’s equity and consist of the amount of those interests at the date of the original business combination plus their share of changes since that date.

A joint venture is a contractual arrangement whereby the Group and other parties undertake an economic activity that is subject to joint control whereby the strategic and operating policy decisions require the unanimous consent of the parties sharing control. The arrangements the Group has entered into involve the establishment of a separate entity in which each party has an interest. The Group reports its interest using the gross equity method. To certain joint ventures, the Group charges staff and overhead costs excluding any profit element for its staff deployed. In these instances, the directors believe that the Group’s share of joint venture profits earned from its role should be included in Group turnover and operating profit to reflect the true substance of the Group’s operational and contractual arrangements with the respective joint ventures.

Investments in associated undertakings are carried in the consolidated balance sheet at the Group’s share of their net assets at the date of acquisition and their post-acquisition retained profits or losses together with any goodwill arising on the acquisition, net of amortisation. The Group’s share of the results is included within the consolidated profit and loss account.

The Group financial statements consolidate the financial statements of the company and its subsidiary undertakings drawn up to 31 December each year. The results of subsidiaries acquired or sold are consolidated for the period from or to the date on which control is passed.

The company has guaranteed the liabilities of certain subsidiaries included within Note 25. Where the company has guaranteed the liabilities of the subsidiaries and they are included within the consolidated financial statements, the subsidiaries are exempt from the requirements of audit under section 479A of the Companies Act 2006.

1.4 Depreciation

Tangible fixed assets are stated at cost less depreciation and any provision for impairment. Depreciation is provided on all tangible fixed assets at rates calculated to write off the cost, less estimated residual value, of each asset over its expected useful life as follows:

% per annum Method

Freehold property 5 Straight line

Computer equipment 33 Straight line

Plant, motor vehicles and equipment

10–20

Straight line

Leasehold improvements

Over the life of the lease

1.5 Impairment

Impairment reviews are carried out when necessary in respect of all tangible and intangible fixed assets and investments and provisions made as appropriate.

1.6 Goodwill

Goodwill arising on consolidation represents the excess of the fair value of the consideration given over the fair values of the identifiable net assets acquired.

The cost of acquisitions comprises the fair value of the initial consideration, deferred consideration paid or accrued and professional and other costs directly associated with the acquisition.

Amortisation of goodwill occurs over the period in which the investment will generate value. This has been estimated by the directors as 10 years of the useful economic life over which the Group expects to derive economic benefits from the assets.

1.7 Operating lease agreements

Rentals applicable to operating leases where substantially all of the benefits and risks of ownership remain with the lessor are charged against profits on a straight line basis over the period of the lease.

Notes to the Financial StatementsYear ended 31 December 2014


91

Notes to the Financial StatementsYear ended 31 December 2014 (contd.)

1.8 Taxation

Current tax, including UK corporation tax and foreign tax, is provided at amounts expected to be paid (or recovered) using the tax rates and laws that have been enacted or substantively enacted at the balance sheet date.

Deferred tax assets or liabilities are recognised, on a full provision basis, for all material timing differences between the recognition of gains and losses in the financial statement and their recognition in the tax computations.

1.9 Pension schemes

The Group participates in the Group defined contribution pension scheme for staff, the assets of which are held separately from those of the company in an independently administered fund. Contributions are charged to the profit and loss account as they become payable

1.10 Short-term work-in-progress and long term contracts

Short-term work in progress is valued at the lower of cost and net realisable value. Cost includes staff costs plus attributable overhead. Net realisable value is based upon the directors’ estimate of future revenues to be generated. Amounts recoverable on long term contracts and deferred income are stated at cost plus attributable profits less foreseeable losses and progress payments received and receivable and are disclosed under debtors. Cost comprises direct labour and attributable overhead. Attributable profit is that proportion of the total profit currently estimated to arise over the duration of a contract which may reasonably be attributed to work carried out at the balance sheet date.

Foreseeable losses are all losses currently expected to arise on contracts in progress, irrespective of their stage of completion at the balance sheet date.

Progress payments received in excess of the value of work executed on individual contracts are included in creditors under the heading payments received on account.

1.11 Foreign currencies

(i) Company

Monetary assets and liabilities in foreign currencies are translated at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are recorded at the rates of exchange ruling at the date of transaction. All differences are taken to the profit and loss account. Differences arising on transactions of a longer term financing nature are recognised in the statement of total recognised gains and losses.

(ii) Group

The financial statements of overseas subsidiary undertakings are translated at the rates of exchange ruling at the balance sheet date. The exchange differences arising on the re-translation of opening net assets are recognised in the statement of total recognised gains and losses.

1.12 Cashflow statement

The company is a wholly owned subsidiary undertaking of Mace Finance Limited, a company registered in England and Wales. Mace Finance Limited prepares consolidated financial statements which include a consolidated cashflow statement dealing with the cash flows of the Group. Mace Limited is therefore not required to prepare a cash flow statement for inclusion in its own accounts.

1.13 Financial instruments

Financial instruments are classified and accounted for, according to the substance of the contractual arrangement, as either financial assets, financial liabilities or equity instruments. Financial assets such as cash and debtors are measured at the present value of the amounts receivable, less an allowance for the expected level of doubtful receivables. Financial liabilities such as trade creditors, loans and finance leases are measured at the present value of the obligation. An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities.

1.14 Investments

Investments are included stated at cost of acquisition less provisions for impairment. The carrying value is considered annually by the directors in comparison against the potential net realisable value.

1.15 Related party transactions

The company is a wholly owned subsidiary of Mace Finance Limited, the consolidated financial statements of which are publicly available. Accordingly, the company has taken advantage of the exemption in FRS 8 from disclosing transactions with members or investees of Mace Finance Limited group of companies.

1.16. Research and Development

The company engages in research and development activities in the course of project delivery. The costs associated with research and development are used to substantiate claims for research and development expenditure credits. Research and development expenditure credits are accrued in line with their estimated value based on qualifying spend.

Mace Limited

92

2. Group turnover

Turnover represents the value of services provided excluding VAT. Turnover analysed by class and geographical market is as follows:

3. Segmental analysis

Year Ended

31 December 2014

£000s

Year Ended

31 December 2013

£000s

Class of business

Construction servicesFixed priceFee basedInternational fixed price

1,097,49125,24476,521

881,81721,927

664

1,199,256 904,408

Consultancy servicesProject management and cost consultancyFacilities management International project and facilities management

103,99386,84296,361

98,63676,181

101,923

287,196 276,740

Total Group turnover 1,486,452 1,181,148

Geographical market United KingdomEuropeAsiaMiddle East and AfricaRest of the world

1,277,434116,735

11,50862,05018,725

1,049,80540,29916,88959,22314,932

Total Group turnover 1,486,452 1,181,148

UK

£000s

Rest of the world

£000s

Total

£000s

Year ended 31 December 2013:Revenue by originSegment profit before taxSegment net assets

1,277,43424,76722,606

209,01810,09424,056

1,486,45234,86146,662

Year ended 31 December 2012:Revenue by originSegment profit before taxSegment net assets

1,049,80527,627

9,058

131,3434,723

16,328

1,181,14832,35025,386



93

4. Operating profit

Year Ended

31 December 2014

£000s

Year Ended

31 December 2013

£000s

The operating profit is stated after charging:Foreign exchange (losses)/gainsAmortisation of goodwillDepreciation of tangible fixed assetsLoss on disposal of fixed assetsResearch and development costs

(14)696

4,465-

10,750

421565

3,69218

13,056

Operating lease rentals:Motor vehiclesLand and buildings

4152,320

4113,135

Services provided by the Company’s auditor and its associatesDuring the year the Group (including its overseas subsidiaries) obtained the following services from the Company’s auditors and its associates:

Fees payable to the Company’s auditor for the audit of the parent company and consolidated accountsFees payable to the Company’s auditor and its associates for other services:The audit of the Company’s subsidiaries pursuant to legislation:UKOverseasOther services pursuant to legislationTax services

60

112651135

53

10761

421


5. Share of joint venture and associated operating profit/(loss)

Group turnover and operating profit have been adjusted to include profits earned from the company’s role in certain joint ventures. This profit represents fees earned by Mace Group staff deployed on projects for whom only cost and overhead is charged by Mace to joint ventures under the contractual agreements.

The directors believe the inclusion of these amounts in the Group’s turnover and operating profit reflects the true substance of the Group’s operational and contractual arrangements with the joint ventures as disclosed in the Group’s accounting policies.

If this true and fair override had not been applied, the following would have been disclosed as share of joint venture operating profits/(losses):

Year Ended

31 December 2014

£000s

Year Ended

31 December 2013

£000s

Share of joint venture and associates operating profit/(loss) as reportedAdd amounts attributed to Mace Group turnover

13-

5901,521

Share of joint venture and associates operating profit if the true and fair override had not been applied 13 2,111

Mace Limited

94

Year Ended

31 December 2014

£000s

Year Ended

31 December 2013

£000s

Remuneration for management services (including benefits)Pension contributions

96792

3,400367

1,059 3,767

Pensions contributions were made in respect of 5 directors (2013: 8)

6. Directors’ remuneration


Directors’ remuneration includes the following amounts in respect of the highest paid director of Mace Limited.

Year Ended

31 December 2014

£000s

Year Ended

31 December 2013

£000s

Remuneration for management services (including benefits)Pension contributions

24119

66690

260 756

7. Staff costs and numbers

Year Ended

31 December 2014

£000s

Year Ended

31 December 2013

£000s

Staff costs were as follows:Aggregate gross wages and salariesEmployer’s social security costsOther pension costs

248,53621,57115,333

229,17418,88013,075

285,440 261,129

Average monthly number of persons employed by the Group during the year:AdministrationProject staff

5543,432

401 3,182

3,986 3,583

The total number of employees as at the balance sheet date was: 4,160 3,806

8. Profit on disposal of development asset

Year Ended

31 December 2014

£000s

Year Ended

31 December 2013

£000s

Profit on disposal 2,600 1,000

The above profit related to the disposal on 1 September 2014 of the Group’s remaining interest in Graduation Deaconess Limited, a special purpose vehicle formed for the development of Deaconess House, a student accommodation building in Edinburgh.


95


9. Interest

Year Ended

31 December 2014

£000s

Year Ended

31 December 2013

£000s

Bank and other interest receivableOther interest payable

523(734)

615(338)

(209) 277

10. Tax on profit on ordinary activities

Year Ended

31 December 2014

£000s

Year Ended

31 December 2013

£000s

(a) Analysis of charge in yearUK corporation tax at 21.5% (2013: 23.25%)Group relief paymentShare of joint ventures and associates tax chargeAdjustments in respect of previous yearsOverseas taxationDeferred tax

4,982--

(1,145)1,562(202)

6,523(567)415

(409)2,588

-

Total current tax (notes 10(b)) 5,197 8,550

(b) Factors affecting tax credit for yearThe tax assessed for the year is lower than the standard rate of corporation in the UK of 21.5% (2013: 23.25%). The differences are explained below:

Profit on ordinary activities before tax 34,861 32,350

Profit on ordinary activities multiplied by standard rate of corporation tax in the UK of 21.5% (2013:23.25%)Effects of:Expenses not deductible for tax purposesNon-taxable profit on disposal of development assetCapital allowances for year less qualifying depreciationUtilisation of tax lossesNon-taxable foreign branch incomeRDEC creditsDifferent rates of tax on overseas earningsAdjustments to tax charge in respect of previous years

7,493

564(559)

2598

(346)(281)(515)

(1,282)

7,520

688 (232)

1541,286

--

(457) (409)

Current tax charge for year (note 10a) 5,197 8,550

11. Profit attributable to members of the parent company

A separate profit and loss account for the company is not presented as permitted by section 408 of the Companies Act 2006. The profit after taxation of the company was £19.7m (2013: £17.8m)

Included within adjustments to the tax charge in respect of previous years is £1m relating to research and development tax credits relating to 2012 and £0.3m relating to 2013.

Mace Limited

96


12. Intangible fixed assets

Group

£000s

Group

GoodwillCostAt 1 January 2014Additions

11,9681,638

At 31 December 2014 13,606

AmortisationAt 1 January 2014Charge for the year

7,643696

At 31 December 2014 8,339

Net book valueAt 31 December 2014 5,267

At 31 December 2013 4,325

13. Tangible fixed assets – Group

Freehold

property

£000s

Leasehold

improvements

£000s

Computer equipment

£000s

Plant, motor vehicles &

equipment

£000s

Total

£000s

Cost or valuationAt 1 January 2014Exchange differencesAdditionsDisposals

1,845113

--

9,94024

1,447-

16,42371

5,486(225)

1,2226

352(83)

29,430214

7,285(308)

At 31 December 2014 1,958 11,411 21,755 1,497 36,621

DepreciationAt 1 January 2014Exchange differencesCharge for the yearDisposals

805

39-

1,220-

673-

8,37733

3,602(220)

68815

151(81)

10,36553

4,465(301)

At 31 December 2014 124 1,893 11,792 773 14,582

Net book valueAt 31 December 2014 1,834 9,518 9,963 724 22,039

At 31 December 2013 1,765 8,720 8,046 534 19,065

On 25 February 2014, Mace Limited purchased the remaining 14% minority share in Mace Cost Consultancy Limited.


97


Tangible fixed assets – Company

Leasehold

improvements

£000s

Computer equipment

£000s

Plant, motor vehicles &

equipment

£000s

Total

£000s

Cost or valuationAt 1 January 2014Additions

9,493688

12,1803,846

18760

21,8604,594

At 31 December 2014 10,181 16,026 247 26,454

DepreciationAt 1 January 2014Charge for the year

896502

5,9592,696

9225

6,9473,223

At 31 December 2014 1,398 8,655 117 10,170

Net book valueAt 31 December 2014 8,783 7,371 130 16,284

At 31 December 2013 8,597 6,221 95 14,913

14. Investments

Joint ventures

and associates

£000s

Other investments

£000s

Subsidiaries

£000s

Total

£000s

Group

Cost less provisionsAt 1 January 2014AdditionsDisposalsShare of results

82--

(45)

1,54720,893(1,547)

-

----

1,62920,893(1,547)

(45)

At 31 December 2014 37 20,893 - 20,930

Company

CostAt 1 January 2014Additions

7-

2,25619,311

9,2961,408

11,55920,719

At 31 December 2014 7 21,567 10,704 32,278

ProvisionAt 1 January 2014Provision in year

--

17510

2,883-

2,900510

At 31 December 2014 - 527 2,883 3,410

Net book valueAt 31 December 2014 7 21,040 7,821 28,868

At 31 December 2013 7 2,239 6,413 8,659

Further information is in note 27 on joint ventures & associates.

15. Current asset investment

At 31 December 2014

£000s

At 31 December 2013

£000s

Current asset investment 35,000 -

Mace Limited

98


16. Work-in-progress

Group Company

31 December 2014

£000s

31 December 2013

£000s

31 December 2014

£000s

31 December 2013

£000s

Work-in-progress 14,191 5,325 5,774 5,080

17. Debtors

Group Company

31 December 2014

£000s

31 December 2013

£000s

31 December 2014

£000s

31 December 2013

£000s

Trade debtorsAmounts recoverable on contractsAmounts owed by ultimate parent companyAmounts owed by immediate parent companyAmounts owed by subsidiary undertakingsAmounts owed by joint ventures and associatesDevelopment loansTaxation and social security receivableOther debtorsPrepayments and accrued income

127,40743,061

3,1706,845

-256

13,8667,6726,167

110,783

112,98333,577

1,679--

32313,730

2,1847,469

64,770

75,38433,842

3,1706,845

45,702256

13,8662,3062,128

63,585

70,87526,369

1,679-

34,003322

13,730-

3,97644,432

319,227 236,715 247,084 195,386

Amounts owed by ultimate and immediate parent companies are due after one year.

Development loans represent investment in development projects made to secure construction turnover, together with development returns. The amount outstanding relates to projects which are substantially complete and awaiting development returns. The loans are repayable upon successful completion of the projects.

On 3 January 2014 Mace Limited subscribed for 100% of the preferred share capital in Mace Capital Limited which is a special purpose vehicle created for the acquisition of shares in Mace Group Limited. The value of the investment is £55.8m, of which £20.8m is reported in fixed asset investments and £35m reported above as a current asset investment. It is the intention of the company to realise the investment by the redemption of shares to the value of £35m during 2015.


99


18. Creditors: amounts falling due within one year

Group Company

31 December 2014

£000s

31 December 2013

£000s

31 December 2014

£000s

31 December 2013

£000s

Bank and other loansPayments received on accountTrade creditorsAmounts owed to subsidiary undertakingsTaxation and social security payableOther creditorsAccruals and deferred income

--

146,022-

49,6966,403

254,777

86291

96,693-

34,6073,104

234,951

--

100,86519,35032,096

1,090182,835

--

67,3631,398

25,3321,236

176,449

455,898 369,732 336,462 271,778

Group Company

31 December 2014

£000s

31 December 2013

£000s

31 December 2014

£000s

31 December 2013

£000s

Payments received on account 15,160 13,971 15,039 13,943

15,160 13,971 15,039 13,943

19. Creditors: amounts falling due after one year

At 31 December 2014

£000s

At 31 December 2013

£000s

Authorised:2,000,000 Ordinary shares of £1 each200,000,000 ‘A’ Ordinary shares of £0.01 each

2,0002,000

2,0002,000

4,000 4,000

Allotted, called up and fully paid:Equity shares:975,888 ordinary shares of £1.00 each348,000 ‘A’ ordinary shares of £0.01 each

9763

9763

979 979

The ‘A’ ordinary shares have no voting rights and do not participate in profits. Subject to a veto right of ordinary shareholders the board may pay a dividend on these shares.

20. Share capital

Mace Limited

100


At 31 December 2014

£000s

At 31 December 2013

£000s

At 1 January and 31 December 17 17

21. Share premium account

Capital redemption

reserve

£000s

Other

reserves

£000s

Profit and loss

account

£000s

GroupAt 1 January 2014Profit for the yearExchange movementsDividends paid

60-

-

65-

-

24,56529,664

(891) (7,612)

At 31 December 2014 60 65 45,726

CompanyAt 1 January 2014Exchange movementsProfit for the yearDividends paid

60---

----

13,692(26)

19,679(7,612)

At 31 December 2014 60 - 25,733

22. Reserves

23. Reconciliation of movement in shareholders’ funds

Group Company

31 December 2014

£000s

31 December 2013

£000s

31 December 2014

£000s

31 December 2013

£000s

Profit for the financial yearExchange movementsDividends paid

29,664(891)

(7,612)

23,513(1,632)

(16,412)

19,679(26)

(7,612)

17,775(4)

(16,412)

Net addition to shareholders’ fundsOpening shareholders’ funds

21,16125,686

5,46920,217

12,04114,748

1,35913,389

Closing shareholders’ funds attributable to equity interests

46,847 25,686 26,789 14,748


101


At 31 December 2014 the Group had annual commitments under non-cancellable operating leases as set out below.

At 31 December 2014

£000s

At 31 December 2013

£000s

Land and buildingsLeases expiring:Within one yearBetween two and five yearsAfter five years

381383

3,129

496722

3,145

3,893 4,363

OtherLeases expiring:Within one yearBetween two and five years

140238

56474

378 530

The Group has no capital commitments.

24. Future commitments

The company is party to a group liability arrangement with its principal bankers providing a right of set-off of all Group balances. Whilst certain Group companies have overdrawn balances, at 31 December 2014 there was no net Group indebtedness to its bankers and therefore the directors consider that no contingency arises.

25. Contingent liabilities

Mace Limited

102

26. Subsidiary undertakings

The following companies were the principal subsidiary undertakings at 31 December 2014:

Country of

registration/incorporation

Class and percentage of

shareholding and voting rights Nature of Business

United KingdomComo Interiors Limited 1 England & Wales Ordinary shares 100% Interior fit out

Mace Business School Limited England & Wales Ordinary shares 100% Training services

Mace Cost Consultancy Limited England & Wales Ordinary shares 83.7% Cost consultancy

Mace Macro Limited England & Wales Ordinary shares 100% Facilities management

Mace MEP Services Limited England & Wales Ordinary shares 100% Mechanical and electrical engineering construction

Mace Plus Limited 2 England & Wales Ordinary shares 100% Construction delivery

Mace Sustain Limited England & Wales Ordinary shares 100% Health, safety and behavioural management consultancy

The People Group Limited 3 England & Wales Dominant influence exercised Recruitment consultancy

Europe and rest of the worldMace International Limited Cyprus Ordinary shares 100% Holding company and project management

Mace Holdings Limited Cyprus Ordinary shares 100% Holding company

1 The equity of this subsidiary is held by Como Group Limited.2 The equity of this subsidiary is held by Mace Plus Group Limited.3 The ordinary share capital of The People Group Limited is owned 100% by the Mace Limited Employee Benefit Trust (‘EBT’). The EBT has implemented a long term incentive plan under which senior executives may be incentivised by the grant to them of reversionary interests over a portion of the assets of the EBT. These interests are capable of vesting on or before 31 December 2015 if specific conditions are met and were granted at £5.26 per share. In addition, Mace Limited representatives represent 66% of the board of The People Group Limited. Therefore in accordance with accounting standards and as a result of the dominant influence exercisable, the interest in The People Group Limited continues to be consolidated as a subsidiary within the Group’s accounts.

The company has guaranteed the liabilities of the following subsidiaries exempt from audit under section 479A of the Companies Act 2006. The company names and registered numbers (CRN) are below:

Como Construction Limited (CRN: 4643980)Como Group Limited (CRN: 4643572)Como Homes Limited (CRN: 4969652)Engage Selection Limited (CRN: 5121839)Graduation (Crags) Limited (CRN: 4643980)Graduation (Exeter) Limited (CRN: 8988759)Graduation Student Living Limited (CRN: 7773718)Luxborough Street Properties Limited (CRN: 8933765)Mace (Albania) Limited (CRN: 8950843)Mace (Poland) Limited (CRN: 8120932)Mace (Russia) Limited (CRN: 7463976)

Mace Business School Limited (CRN: 5601050)Mace International Overseas Limited (CRN: 7463976)Mace Living Limited (CRN: 5156449)Mace Macro (Asia Pacific) Limited (CRN: 7407865)Mace Macro (The Americas) Limited (CRN: 6910338)Mace Macro Europe Limited (CRN: 6897543)Mace Plus Academies Limited (CRN: 5897947)Mace Plus Group Limited (CRN: 5349265)Mace Plus Limited (CRN: 5282952)Mace Real Estate Limited (CRN: 3471116)



103


27. Joint ventures and associates

The following companies were the principal joint ventures and associates at 31 December 2014:

Country of

registration/incorporation

Class and percentage of

shareholding and voting rights Nature of Business

United Kingdom

Cambridge Heath Road Developments Limited

England & Wales Ordinary shares 51% Property development

Court Orchard Limited England & Wales Ordinary shares 57% Property development

Doric Properties Limited England & Wales Ordinary B shares 50% Property development

Hadley Mace Limited England & Wales Ordinary shares 50% Property development

Vennsys Limited England & Wales Ordinary shares 15% Programme management

The following represents the aggregate share of joint venture and associate tangible fixed assets, current assets and creditors due within one year:

At 31 December 2014

£m

At 31 December 2013

£m

Tangible fixed assetsCurrent assetsCreditors due within one year

15.115.027.6

0.32.83.3

The company is a wholly owned subsidiary of Mace Group Limited and its ultimate parent is Mace Finance Limited. Both companies are incorporated in England and Wales. A change of ownership occurred on 6 January 2014, whereby Mace Finance Limited became ultimate parent (see note 15).

At 31 December 2014 the amounts due (to)/from non-wholly owned subsidiaries and joint ventures and associates were:

At 31 December 2014

£000s

At 31 December 2013

£000s

Consulmace LdaMace Cost Consultancy LimitedVennsys Limited

--

28

184(42)

1,160

During the year the company billed and charged its non-wholly owned subsidiaries and joint ventures and associates the following amounts in respect of services and corporate allocations:

At 31 December 2014

£000s

At 31 December 2013

£000s

CLM Delivery Partner Limited (Joint Venture)Mace Cost Consultancy LimitedVennsys Limited

--

700

2,141825330

28. Related Party Transactions

28. Ultimate parent undertaking

Mace 155 Moorgate London EC2M 6XB +44 (0)20 3522 3000 www.macegroup.com

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1 Introduction 3 - Mace · Stephen Pycroft 2014 was another rewarding and profitable year for Mace...

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Transcript of 1 Introduction 3 - Mace · Stephen Pycroft 2014 was another rewarding and profitable year for Mace...