Relx PLC Sponsored ADR

Company Overview

Business Model: RELX PLC is a global provider of information-based analytics and decision tools for professional and business customers. The Group generates revenue primarily from subscriptions (53% in 2024) and transactional sales (47% in 2024), with electronic formats accounting for 83% of total revenue in 2024. It operates across four major market segments:

• Risk: Provides information-based analytics and decision tools that combine public and industry-specific content with technology and algorithms to assist customers in evaluating and predicting risk.
• Scientific, Technical & Medical: Helps researchers and healthcare professionals advance science and improve health outcomes by providing information and analytics. It operates under both 'pay-to-read' and 'pay-to-publish' (Open Access) models.
• Legal: Assists customers in improving decision-making, increasing productivity, and achieving better outcomes through information and analytics that integrate content and technology.
• Exhibitions: Combines industry expertise with data and technology to deliver face-to-face and online events, facilitating learning, sourcing, and transactions for customers.

Market Position: RELX PLC positions itself as a global leader in information-based analytics and decision tools, operating in highly competitive and dynamic markets. The company emphasizes its deeply embedded, AI-enabled analytics and decision tools as key drivers of growth across its Risk, Scientific, Technical & Medical, and Legal segments. The Exhibitions segment has achieved improved profitability due to a streamlined event portfolio and value-enhancing digital initiatives. The company's strategy involves evolving its business mix towards higher-growth, higher-value analytics and tools, particularly in the Legal and Scientific, Technical & Medical segments.

Recent Strategic Developments:

• Acquisitions & Disposals: Cash spent on acquisitions was £175 million in 2024, up from £132 million in 2023. Net cash inflow from disposals was £46 million in 2024, compared to £12 million in 2023.
• Technology & Innovation: Continued investment in global technology platforms, new products, and related infrastructure. Key developments include the successful roll-out of Lexis+ AI (leveraging generative AI) in the US and international markets, and the positive reception of Protégé, a next-generation generative AI legal assistant, within the Legal segment.
• Portfolio Evolution: Strategic focus on shifting the business mix towards higher-growth, higher-value analytics and decision tools across segments, and enhancing digital offerings for face-to-face events.

Geographic Footprint: RELX PLC serves customers in over 180 countries and territories, maintaining offices in approximately 40 countries. Over 40% of its more than 36,000 employees are located in North America.

• Revenue Distribution (2024): North America accounted for 58% (£5,495 million), Europe for 22% (£2,025 million), and the Rest of world for 20% (£1,914 million).
• Key Operational Centers: The majority of capital expenditure is incurred in the United States, the United Kingdom, and the Netherlands. The principal executive office is in London, England, with a significant US presence in New York, New York.

Cross-Border Operations: RELX PLC is incorporated in England and owns 100% of RELX Group plc, which holds all operating businesses, subsidiaries, and financing activities globally. The Group's consolidated financial statements are expressed in sterling, with significant exposure to US dollar and euro exchange rate movements, which can materially impact reported results. Debt is denominated in US dollars and euros to partially offset these exposures. The Group operates pension schemes in various countries, including the United Kingdom and the United States.

• Iran-Related Activities: In 2024, RELX PLC engaged in limited activities with Iran, primarily through its Scientific, Technical & Medical, Risk, and Exhibitions businesses, providing online subscriptions, publications, and exhibition services. Aggregate revenue from these activities was approximately £2.0 million in 2024 (up from £1.9 million in 2023), representing an estimated 0.02% of net profit in both years. These activities are conducted through non-US affiliates and businesses, or under US government authorizations.

Financial Performance

Revenue Analysis

Profitability Metrics:

• Operating Margin: 30.3% (2024) vs 29.3% (2023)

Investment in Growth:

• R&D Expenditure (capitalized development costs): £464 million (2024) vs £447 million (2023). This represents 4.9% of revenue in 2024.
• Capital Expenditures (property, plant, equipment, and internally developed intangible assets): £484 million (2024) vs £477 million (2023).
• Strategic Investments: £175 million for acquisitions in 2024, and £4 million in venture capital investments in 2024.

Currency Impact Analysis:

• Foreign exchange movements decreased total revenue by £291 million, operating profit by £100 million, and profit before tax by £97 million in 2024.
• The Group manages foreign exchange transaction exposure by hedging at market rates through a centralized treasury department.
• The consolidated financial statements are presented in sterling, with primary currency exposures to the US dollar and the euro. Debt is denominated in these currencies to provide a natural hedge.

Business Segment Analysis

Risk

Financial Performance:

• Revenue: £3,245 million (+4% YoY actual, +7% constant currency)
• Adjusted Operating Margin: 37.8% (2024)
• Key Growth Drivers: Strong underlying revenue growth driven by deeply embedded, AI-enabled analytics and decision tools. Business Services saw continued growth from Financial Crime Compliance and digital Fraud & Identity solutions. Insurance growth was fueled by extended solution sets, positive market factors, and new sales. Specialised Industry Data Services growth was led by Commodity Intelligence, and Government growth by the development and roll-out of analytics and decision tools.

Product Portfolio:

• Information-based analytics and decision tools, including AI-enabled solutions.
• Financial Crime Compliance and digital Fraud & Identity solutions.
• Insurance solution sets.
• Commodity Intelligence.
• Analytics and decision tools for government.

Market Dynamics:

• Sustained strong underlying revenue growth across segments.
• Operates in a highly competitive and dynamic environment.

Geographic Revenue Distribution:

• Not explicitly detailed by region within the segment in the filing.

Scientific, Technical & Medical

Financial Performance:

• Revenue: £3,051 million (0% YoY actual, +3% constant currency)
• Adjusted Operating Margin: 38.4% (2024)
• Key Growth Drivers: Underlying revenue growth driven by the evolution of the business mix towards higher-growth segments and a faster decline in print revenue. Databases, Tools & Electronic Reference experienced growth from higher value-add analytics and decision tools. Primary Research growth was driven by volume, with strong article submissions, particularly in the pay-to-publish (Open Access) model.

Product Portfolio:

• Primary research content publishing (pay-to-read and Open Access).
• Databases, Tools & Electronic Reference, including higher value-add analytics and decision tools.
• Scientific, medical, and technical publications.

Market Dynamics:

• Revenue mix is evolving, with higher-growth segments increasing their proportion of divisional revenue.
• Faces risks from rapid changes in customer choice, regulation, or technologies, which could impact revenue mix and growth.
• Maintaining research integrity is a key challenge due to evolving technologies and fraud risks.

Geographic Revenue Distribution:

• Not explicitly detailed by region within the segment in the filing.

Legal

Financial Performance:

• Revenue: £1,899 million (+3% YoY actual, +6% constant currency)
• Adjusted Operating Margin: 21.7% (2024)
• Key Growth Drivers: Improved underlying revenue growth driven by a shift towards higher-growth, higher-value legal analytics and tools. Lexis+, an integrated platform leveraging extractive AI, performed well. Lexis+ AI, utilizing generative AI, successfully rolled out in the US and international markets. Protégé, a new generative AI legal assistant, received positive customer feedback. Growth in Government & Academic and News & Business segments was driven by the extension of analytics and decision tools, with strong renewals and new sales.

Product Portfolio:

• Legal analytics and tools, including AI-powered solutions.
• Lexis+ (extractive AI platform).
• Lexis+ AI (generative AI platform).
• Protégé (generative AI legal assistant).
• Analytics and decision tools for Government & Academic and News & Business.

Market Dynamics:

• Strong growth driven by the strategic shift towards higher-value legal analytics and tools.
• Successful international expansion of AI-enabled products.

Geographic Revenue Distribution:

• Not explicitly detailed by region within the segment in the filing.

Exhibitions

Financial Performance:

• Revenue: £1,239 million (+11% YoY actual, +16% constant currency)
• Adjusted Operating Margin: 32.1% (2024)
• Key Growth Drivers: Strong underlying revenue growth reflecting an improved event portfolio and favorable comparisons to the prior year. Profitability improved due to a structurally lower cost base of the streamlined event portfolio and progress on value-enhancing digital initiatives, increasing the usage of digital tools for customers of face-to-face events.

Product Portfolio:

• Face-to-face and online events.
• Digital tools for event customers.

Market Dynamics:

• Improved growth profile and profitability.
• Face-to-face events are susceptible to external factors such as economic cycles, communicable diseases, natural disasters, and venue availability.

Geographic Revenue Distribution:

• Not explicitly detailed by region within the segment in the filing.

International Operations & Geographic Analysis

Revenue by Geography:

International Business Structure:

• Subsidiaries: RELX PLC owns 100% of RELX Group plc, which in turn owns all of the operating businesses, subsidiaries, and financing activities of the Group. A comprehensive list of subsidiaries, associates, joint ventures, and business units is filed as Exhibit 8.0.
• Joint Ventures: The Group makes investments in joint ventures and associates, as reflected in its cash flow from investing activities.
• Licensing Agreements: The Group relies on licensing arrangements with third parties to protect its proprietary rights in intellectual property content.

Cross-Border Trade:

• Export Markets: Not explicitly detailed in the filing.
• Import Dependencies: Not explicitly detailed in the filing.
• Transfer Pricing: The Group reports cross-border transactions between subsidiaries on an arm’s-length basis, adhering to Organisation for Economic Co-operation and Development (OECD) guidelines. The valuation of transfer pricing relies on significant management judgment due to the range of potential outcomes based on interpretations of applicable tax laws and regulations.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: £1,000 million was spent to repurchase 28.9 million RELX PLC shares in 2024. A further 3.8 million shares were repurchased in 2025 as of February 12, 2025. RELX PLC announced its intention to repurchase additional ordinary shares up to £1,350 million over the remainder of 2025.
• Dividend Payments: Total ordinary dividends paid to shareholders amounted to £1,121 million in 2024, up from £1,059 million in 2023. The total dividend for the year increased by 7% to 63.0p per share in 2024 (from 58.8p in 2023). The final dividend proposed for 2024 is 44.8p per share.
• Dividend Policy: Over the longer term, the Group aims to grow dividends broadly in line with adjusted earnings per share, targeting a payout of approximately half of adjusted earnings annually.

Balance Sheet Position:

• Cash and Equivalents: £119 million as of December 31, 2024.
• Total Debt: £6,544 million as of December 31, 2024.
• Net Debt Position: £6,563 million as of December 31, 2024 (comprising gross bank and bond borrowings, lease liabilities, and related derivative financial instrument liabilities, less cash and cash equivalents and finance lease receivables). Excluding currency translation effects, net debt increased by £163 million in 2024.
• Credit Rating: The Group aims to maintain credit rating agency metrics consistent with a solid investment grade credit rating.
• Debt Maturity Profile:
  • Short-term debt (due within 1 year): £1,432 million.
  • Long-term debt: £6,145 million, with maturities distributed across 1-3 years (£136 million), 3-5 years (£1,344 million), and after 5 years (£3,006 million).
  • In March 2024, €850 million of euro-denominated term debt was issued with a 3.375% coupon and a nine-year maturity.
  • The Group has access to a $3.0 billion committed bank facility, undrawn as of December 31, 2024, with a maturity extended to April 2027.

Cash Flow Generation:

• Operating Cash Flow (cash generated from operations): £3,521 million in 2024, up from £3,370 million in 2023.
• Cash Conversion Metrics: The Group targets maintaining cash flow conversion of 90% or higher over the long term.

Currency Management:

• Cash holdings by major currencies: Not explicitly detailed, but the Group's principal currency exposures are to the US dollar and the euro.
• Natural hedging through operational diversification: Debt is denominated in US dollars and euros to partially offset currency exposures.
• Financial hedging instruments and strategies: The Group uses derivative financial instruments, including interest rate swaps and forward foreign exchange contracts, to manage interest rate and foreign exchange rate risks, strictly for hedging purposes and not for speculation.

Operational Excellence

Production & Service Model: RELX PLC operates as a global provider of information-based analytics and decision tools. Its products and services, which incorporate intellectual property content, are delivered through various media, including online platforms, journals, and books. The business relies heavily on electronic platforms and networks, including its own and third-party data centers, cloud providers, network systems, and the internet for product and service delivery. Face-to-face events, a core part of the Exhibitions segment, are also a significant service delivery method.

Global Supply Chain Architecture: Key Suppliers & Partners:

• Outsourced Functions: The Group's organizational and operational structures depend on various suppliers, including those providing outsourced and offshored functions, cloud services, software, and large language models.
• Content & Data Providers: RELX PLC sources content to develop information solutions for its professional customers, facing risks related to the disruption or loss of data sources due to regulations or supplier decisions.
• Third-Party Service Providers: The Group provides data to and relies on third-party service providers for its online databases and platforms. A Third Party Provider Policy is in place to assess and manage cybersecurity risks from these suppliers, including evaluations using industry standard criteria and periodic re-assessments.

Facility Network:

• Manufacturing: Not explicitly detailed in the filing.
• Research & Development: R&D activities, primarily focused on developing electronic products and investing in systems infrastructure, computer equipment, and office facilities, are mainly conducted in the United States, the United Kingdom, and the Netherlands.
• Distribution: The Group's operations are dependent on electronic delivery platforms, networks, and supporting infrastructure.
• Key Properties (as of December 31, 2024):
  • Owned: Alpharetta, Georgia (Office and data centre, 406,000 sq ft).
  • Leased: Miamisburg, Ohio (Office and data centre, 137,249 sq ft); Amsterdam, Netherlands (Office, 133,474 sq ft); Raleigh, North Carolina (Office, 120,000 sq ft); Horsham, Pennsylvania (Office, 120,000 sq ft); New York, New York (Office, 116,541 sq ft).

Operational Metrics:

• Staff costs, excluding contractors and employer benefits but including capitalized amounts, increased from £3,108 million in 2023 to £3,120 million in 2024.
• The Group continuously implements actions to improve cost efficiency, benefiting from process innovation.
• The Exhibitions segment has achieved improved profitability due to a structurally lower cost base resulting from a streamlined event portfolio.

Market Access & Customer Relationships

Go-to-Market Strategy: Distribution Channels:

• Digital Platforms: Electronic delivery platforms and online channels are central to the Group's strategy, accounting for 83% of total revenue in 2024. This includes online databases, networks, and internet-based delivery of products and services.
• Face-to-Face Events: The Exhibitions segment delivers face-to-face events, which contributed 13% of total revenue in 2024, complemented by digital tools for event customers.
• Print: A smaller portion of revenue (4% in 2024) is derived from print formats, which are experiencing a decline.

Customer Portfolio: Enterprise Customers:

• Professional and Business Customers: The Group serves a broad base of professional and business customers across its segments.
• Risk Segment: Key customer types include Business Services (Financial Crime Compliance, digital Fraud & Identity solutions), Insurance, and Government.
• Scientific, Technical & Medical Segment: Serves researchers and healthcare professionals.
• Legal Segment: Caters to legal professionals, Government & Academic institutions, and News & Business clients.
• Strategic Partnerships: Not explicitly detailed in the filing, but implied through various collaborations and customer relationships.
• Customer Concentration: Not explicitly detailed as a specific risk, but the Group's performance is dependent on the continued demand and value placed on its products and services by its diverse customer base.

Regional Market Penetration:

• RELX PLC has a broad international reach, serving customers in over 180 countries and territories.
• North America is the most significant market, contributing 58% of total revenue in 2024.
• The Legal segment's Lexis+ AI, leveraging generative AI, has seen a successful roll-out in the US and has launched in international markets, indicating a focus on expanding market penetration with advanced solutions globally.

Competitive Intelligence

Global Market Structure & Dynamics

Industry Characteristics: The Group operates in a highly competitive and dynamic environment characterized by rapid change. Key trends driving industry evolution include technological innovations (such as the increasing use of AI), legislative and regulatory changes, the emergence of new competitors, and evolving customer demand. The Scientific, Technical & Medical segment faces specific dynamics related to changes in payment models (e.g., the shift towards Open Access/pay-to-publish) and the need to maintain research integrity amidst evolving technologies. Demand for products and services is also influenced by levels of government and private funding in the Group's markets.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors: The filing notes the "entrance of new competitors" as a general risk but does not explicitly name specific direct competitors. Regional Competitive Dynamics: The competitive landscape is influenced by national legislative initiatives and cross-border initiatives (e.g., from the European Commission) affecting copyright laws and intellectual property protection in various jurisdictions where the Group operates.

Risk Assessment Framework

Strategic & Market Risks

Global Market Dynamics:

• Geopolitical, Economic, and Market Conditions: Demand for products and services, and the ability to operate internationally, can be adversely affected by acts of war, civil unrest, political conflicts, international sanctions, economic cycles, inflation, interest rate changes, and trading relations between major economies (e.g., US, Europe, China).
• Technology Disruption: Failure to anticipate and adapt to technological innovations, including AI, or to deliver enhanced value to customers, could impact demand and long-term returns from investments in analytics and decision tools.
• STM Payment Model Changes: Rapid changes in customer choice, regulation, or technologies in the Scientific, Technical & Medical primary research publishing business (e.g., shift to Open Access) could impact revenue mix and growth.

Operational & Execution Risks

Global Supply Chain Vulnerabilities:

• Supplier Dependency: Reliance on outsourced and offshored functions, cloud service providers, software providers, and large language model providers. Poor performance, failure, or breach by these third parties could adversely affect business performance.
• Data Source Disruption: Risk of disruption or loss of data sources due to regulations or suppliers' decisions, limiting the ability to collect, use, or make information available to customers.
• Regional Disruptions: Face-to-face events are susceptible to economic cycles, changes in trading relations, communicable diseases, severe weather events, natural disasters, terrorism, and venue availability.
• System Failure: Significant failure or interruption of electronic delivery platforms, networks, distribution systems, or infrastructure could adversely affect business operations.

Financial & Regulatory Risks

Currency & Financial Risks:

• Foreign Exchange: Fluctuations in exchange rates, particularly the US dollar and euro against sterling, can significantly affect reported results.
• Interest Rate Risk: Exposure to interest rate fluctuations on debt, cash, and cash equivalents, impacting net finance costs.
• Credit & Liquidity: Macroeconomic, political, and market conditions can affect the availability and cost of funding. Downgrades to credit ratings could adversely affect borrowing costs and access to capital.
• Pension Obligations: Changes in market values of defined benefit pension scheme assets and actuarial assumptions can increase funding requirements.

Regulatory & Compliance Risks:

• Multi-Jurisdictional Compliance: Subject to increasing and evolving privacy, data protection, and consumer information laws and regulations across US federal and state, UK, and EU jurisdictions. Non-compliance can lead to reputational damage, fines, and litigation.
• Trade Regulations: Compliance with export controls and international sanctions, including disclosures under the US Iran Threat Reduction and Syria Human Rights Act of 2012 for limited activities with Iran.
• Tax Regulations: Changes in tax laws or uncertainty in their application and interpretation across multiple jurisdictions can adversely affect reported results.
• FTC Consent Orders: Failure to comply with existing US Federal Trade Commission consent orders (from 2006 and 2008 regarding consumer information and security) could result in civil penalties and reputational damage.

Geopolitical & External Risks

Country-Specific Risks:

• Political Risk: Geopolitical events such as acts of war, civil unrest, political conflicts, and international sanctions can adversely affect demand and international operations.
• Economic Risk: Economic cycles, inflation, interest rate changes, and trading relations between major economies can impact customer budgets and overall market conditions.
• Regulatory Changes: Changes in law and legal interpretation affecting products and services in various jurisdictions.

Innovation & Technology Leadership

Research & Development Focus: Global R&D Network: RELX PLC maintains a sustained investment in new products and related infrastructure, with capitalized development costs amounting to £464 million in 2024. These expenditures are primarily incurred in the United States, the United Kingdom, and the Netherlands. The R&D focus is on developing electronic products, systems infrastructure, computer equipment, and office facilities.

• Innovation Pipeline: The Group emphasizes the development of "deeply embedded, AI-enabled analytics and decision tools" across its segments. Specific examples include Lexis+ (extractive AI) and Lexis+ AI (generative AI) platforms, and Protégé (generative AI legal assistant) within the Legal segment, as well as higher value-add analytics and decision tools in Scientific, Technical & Medical.

Intellectual Property Portfolio:

• Patent Strategy: RELX PLC relies on trademark, copyright, patent, trade secret, and other intellectual property laws, along with licensing arrangements with third parties, to establish and protect its proprietary rights in its products and services.
• Licensing Programs: Licensing arrangements with third parties are utilized to protect and leverage intellectual property.
• IP Litigation: The Group faces the risk that its proprietary rights could be challenged, limited, invalidated, infringed, or circumvented, including by artificial intelligence technologies. Copyright laws are subject to national and cross-border legislative initiatives and increased judicial scrutiny in several operating jurisdictions.

Technology Partnerships:

• The Group's operational structures depend on various suppliers, including cloud service, software, and large language model providers, implying strategic alliances and collaborations in technology development and delivery.

Leadership & Governance

Executive Leadership Team

International Management Structure: The Group employs over 36,000 people globally, with more than 40% in North America, and competes globally for skilled employees and management, particularly in technology and data analytics. Governance over technology and cybersecurity risks is coordinated through three cross-functional senior-level forums: the RELX Information Security Council (ISC), the RELX Technology Forum (CTO Forum), and the Security Governing Committee (SGC). These forums include Chief Information Security Officers and Chief Technology Officers from each business area, along with other senior management, ensuring a coordinated approach to global technology and cybersecurity strategy.

Board Composition: The Board of RELX PLC comprises two Executive Directors, the Chair, and seven Non-Executive Directors, all of whom are independent.

• Committees: The Board has established an Audit Committee (five independent Non-Executive Directors, chaired by Suzanne Wood, who is the Audit Committee financial expert), a Corporate Governance Committee (all Non-Executive Directors), a Nominations Committee (two Non-Executive Directors), and a Remuneration Committee (three Non-Executive Directors).
• Director Changes (2024-2025): Marike van Lier Lels retired in April 2024. Bianca Tetteroo joined in July 2024. Robert MacLeod will retire in April 2025, to be succeeded by Alistair Cox as Chair of the Remuneration Committee. Andy Halford was appointed as a Non-Executive Director effective April 2025.
• Directors normally retire and offer themselves for re-election at each Annual General Meeting.

Regulatory Environment & Compliance

Multi-Jurisdictional Regulatory Framework: Primary Regulatory Environments: RELX PLC's businesses are subject to an increasing and evolving landscape of privacy, data storage and transfer, data protection, and consumer information laws and regulations. These include US federal and state laws, UK laws, and EU laws and regulations, as well as those of individual EU member states.

• Compliance Requirements: Obligations vary by jurisdiction and may include reasonable data security programs, regulatory reporting, data localization, providing notices to individuals, and, in some cases, limiting data or correcting inaccuracies in reports.
• FTC Consent Orders: The Group is subject to consent orders from 2006 and 2008 with US regulators concerning consumer information and security-related issues. Compliance with these orders, including comprehensive data security programs and ongoing monitoring, is a material obligation.

Cross-Border Compliance:

• Export Controls: The Group engages in limited activities with Iran, as disclosed under Section 219 of the US Iran Threat Reduction and Syria Human Rights Act of 2012, through non-US affiliates or under US government authorizations. This highlights compliance with multi-jurisdictional export controls and sanctions.
• Sanctions Compliance: Adherence to high standards of integrity and ethical conduct, including compliance with international sanctions.
• Anti-Corruption: The Group expects its employees, major suppliers, and partners to adhere to high ethical standards, including those related to anti-bribery and anti-corruption, data protection, fraud, and competition laws.

International Tax Strategy:

• Transfer Pricing: The Group reports cross-border transactions between its subsidiaries on an arm’s-length basis, in accordance with Organisation for Economic Co-operation and Development (OECD) guidelines. This involves significant judgment due to the complexity of applicable tax laws and regulations across numerous jurisdictions.
• Tax Treaties: Not explicitly detailed, but the Group's global operations imply engagement with international tax treaties to manage taxation in different jurisdictions.
• BEPS Compliance: Not explicitly detailed in the filing.

Environmental & Social Impact

Global Sustainability Strategy: Environmental Commitments: The Group refers to its "Task Force on Climate-related Financial Disclosures" on pages 236-241 of the RELX 2024 Annual Report for detailed information on its climate strategy and environmental commitments. This indicates a focus on addressing climate-related risks and opportunities.

Regional Sustainability Initiatives:

• Not explicitly detailed in the filing.
• Supply Chain: Not explicitly detailed in the filing.

Social Impact by Region:

• Community Investment: Not explicitly detailed in the filing.
• Labor Standards: RELX PLC is committed to employee involvement and participation, operating as an equal opportunity employer. It recruits and promotes based on suitability for the job and provides appropriate training and development opportunities to all employees. The Group has adopted a code of ethics and business conduct applicable to all employees.

Currency Management & Financial Strategy

Multi-Currency Operations: Currency Exposure:

Hedging Strategies:

• Transaction Hedging: Individual businesses manage foreign exchange transaction exposure at market rates through a centralized treasury department, primarily using forward foreign exchange contracts. This is the only hedging activity undertaken by individual businesses.
• Translation Hedging: The Group's consolidated financial statements are expressed in sterling, making them subject to translation risk from other operational currencies. This risk is partially mitigated by denominating a majority of the Group's debt in US dollars and euros.
• Economic Hedging: Not explicitly detailed in the filing.
• General Strategy: The Group uses derivative financial instruments, including interest rate swaps and forward foreign exchange contracts, solely to hedge (or reduce) underlying interest rate and exchange rate risks, and does not engage in speculative derivative transactions. Derivatives are designated in highly effective hedging relationships where potential fair value changes are significant.