PRINCIPAL RISKS AND UNCERTAINTIES CONTINUED
VIABILITY STATEMENT
Risk description Potential impact
Mitigating actions
Change in the year
Regulatory/compliance risk 14 Legal, regulatory, and compliance
Unintentional failure to comply with international
■ Fines, penalties or legal action ■ Reputational damage ■ Operational disruption
■ Employees and advisors with relevant skills to keep up to date with changes in regulations and legal requirements ■ Group policies, procedures and training in risk areas such as export controls and supplier and customer credit risk. ■ Annual supplier audits undertaken across the Group to ensure compliance with Supplier Code of Conduct ■ Ongoing internal audit reviews assess compliance with Group policies ■ A whistleblowing hotline is in place and available for use by all employees ■ Insurance covers all standard categories of insurable risk
■ Work undertaken by Group Internal Audit function to ensure compliance with revisions to UK
and local legal and regulatory requirements
Corporate Governance Code, which were finalised in January 2024 Link to KSIs: D
KEY STRATEGIC INDICATORS A Sales growth B Adjusted
Adjusted earnings per share growth
C
In accordance with section 4.31 of the 2024 UK Corporate Governance Code, the Directors have assessed the viability of the Group over a three-year period to 31 March 2029
operating margin
Return on capital employed
Carbon emissions reduction
D Cash conversion
E
F
Viability base case The financial projections for this three-year period are based upon the Group’s budget for the year ending 31 March 2027 and forecast progression thereon. The budget is a consolidation of sales, profits, working capital and cash flow forecasts made by each operating company and head office, incorporating associated key risk factors, including acquired company forecasts and associated contingent consideration payments, latest views on supplier and customer payments impacting working capital, interest rates and applicable foreign exchange and tax rates. The budget for the financial year ending 31 March 2027 and the projections for the financial years FY 2027/28 and FY 2028/29 assume steady sales growth (in total “The Viability Base Case”).
In making this assessment, the Directors have considered the Group’s current financial position, recent and historic financial performance and forecasts, its strategy and business model and the principal risks and uncertainties. Viability assessment period The Directors have concluded that the most appropriate time period over which to assess the Group’s prospects for this purpose should be the three-year period ending 31 March 2029. The selection of this period is consistent with the Group’s strategic planning process, its review of external credit facilities, and its assessment of the Group’s principal risks and uncertainties. Both the viability base case and downside sensitivities include the impact of the acquisition of Trival Antene d.o.o completed on 1 April 2026 and 3Gmetalworx announced on 19 May 2026, subject to receipt of regulatory approvals.
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discoverIE Group plc Innovative Electronics
Annual Report and Accounts for the year ended 31 March 2026
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