The board uses 16 key performance indicators (KPIs) to judge progress towards strategic objectives. They are grouped within three categories, Colleagues, Customers and Shareholders. The group’s progress against these KPIs is shown below.

 

Progress update:

  • Limited progress
  • Progress
  • Strong progress
 
Categories Goals 2010 2009  
Colleagues Colleague engagement 70% 70% Progress
  Sales colleague retention 63.8% 63.5% Progress
  Service colleague retention 75.9% 74.4% Progress
  Health and safety (H&S) lost time through accidents (LTA) 1.72 1.53 Limited Progress
Customers Gross sales % of opening portfolio 16.3% 14.6% Progress
  Customer retention 83.9% 80.8% Strong Progress
  Net gain % of opening portfolio 1.8% -3.6% Progress
  State of Service 97.2% 98.1% Strong Progress
  Customer satisfaction (Customer Voice Counts) 19% N/A Progress
Shareholders Organic revenue growth -1.6% -3.1% Progress
  Total revenue growth (inc. acquisitions) -1.2% -2.2% Progress
  APBITA margin 9.6% 8.3% Progress
  Debtors (days sales outstanding – DSO) 47 49 Strong Progress
  Cost savings delivered in year £60m £82m Progress
  Cash conversion targets as % of operating profit 114% 143% Strong Progress
  Gross capex as % of depreciation 87% 83% Strong Progress
 
 

Explanation of 2010 KPIs

Colleague engagement – “Your Voice Counts” is an employee engagement survey and represents the aggregate engagement rating from these reports.

Sales colleague retention is the reciprocal of total sales heads leaving in the year as a percentage of the sales head count at the beginning of the year. Service colleague retention is the reciprocal of total service heads leaving in the year as a percentage of the service head count at the beginning of the year.

H&S lost time through accidents (LTA) is defined as a work-related injury or illness to an employee which results in them being absent from work for one day/shift or more (this excludes the day/shift in which the accident occurred). The number of lost time accidents is expressed as a rate per 100,000 standard working hours.

Gross sales percentage of opening portfolio are additions to the portfolio (new business and additions to existing business but excluding price increases) expressed as a percentage of the opening portfolio. Customer retention percentage is the reciprocal of total terminations (reductions and terminations) expressed as a percentage of opening portfolio. Net gain percentage of opening portfolio is the movement in the portfolio expressed as a percentage of the opening portfolio.

State of Service is the total number of service visits performed divided by the total number of visits due. “Customer Voice Counts” (i.e. net promoter score) is measured by the average net promoter score rating across all branches in the business.

Organic revenue growth is revenue growth excluding the effect of acquisitions. Total revenue growth (incl. acquisitions) is the year-on-year increase in total revenue expressed as a percentage of the previous year’s revenue. Both measures are at constant exchange rates.

APBITA margin (%) is the adjusted profit before interest, tax and amortisation (“APBITA”) expressed as a percentage of total revenue.

Debtors days sales outstanding (DSO) are trade debtors gross of provisions calculated on the exhaust basis (i.e. going back over the relevant number of preceding days’ invoicing until the debt balance is zero). The number of days this takes is the debtor days.

Cost savings are savings delivered in the year related to permanent cost reductions. Cash conversion targets as percentage of operating profit is operating cash flow expressed as a percentage of APBITA.

Gross capex as percentage of depreciation means cash capital additions (net of proceeds from disposals) expressed as a percentage of depreciation.

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