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How we performed

We align how we measure our performance against our strategic priorities.

The operational areas of Customer, Technology, Efficiency and People and their related KPIs provide a clear tool to measure the delivery of our strategic priorities. The remaining financial KPIs are directly impacted by this performance and are the resulting outcome.

Customer Loyalty

Measure

Net Promoter Score.

Relevance

It is important that we understand the extent to which we meet our customers’ needs. Net Promoter Score (NPS) measures the proportion of our customers who think we do an excellent job against those who think we are average or worse.

Target

Sustainable improvements in the NPS over time.

Performance

In 2016, the NPS score was stable on the high level achieved in 2015. We see this as a good performance and our Strategic Priority around the customer should only work to improve this in the future.

Net Promoter Score 63%

Customer Activity

Measure

Utility order intake and off-hire rate.

Relevance

The Utility order intake and utilisation rate are influenced by a wide range of factors but taken in context they can be an indicator of how our strategy, sales approach and pricing are being received in the market. We track new orders won (MWs) and the off-hire rate, which is the number of MWs that off-hire during the year divided by the number of MWs on-hire at the beginning of the year.

Target

We aim to increase our order intake on an annual basis, subject to market conditions. Our off-hire rate is often outside our control however we aim to keep it as low as possible, noting that the historic average is around 30%.

Performance

During 2016, we had an order intake of over 1GW. While we believe some of this may be a result of the lower oil price impacting the affordability of our diesel engines, it also coincides with the implementation of our business priorities which have focused on Customer, Efficiency and Technology.

Power solutions utility order intake 1,057MW


Power solutions utility off-hire rate 30%

Technology; Fleet and size composition

Measure

Total power fleet size (in MW), split between engine type (Diesel, Diesel G3+, Gas, Next Generation Gas (NGG), HFO).

Relevance

Our strategy is to grow ahead of the market. To remain competitive we need to lower the total cost of energy to our customers. The best way to do this is through more fuel efficient engines or alternative sources of energy.

Target

Increasing proportions of our market leading products in fuel efficiency, the diesel G3+ and Next Generation Gas engine. Additionally, an increasing proportion of our new medium speed HFO engine, in line with market demand.

Performance

In 2016, we upgraded 267 diesel sets to the G3+, produced over 200MW of our Next Generation Gas engine and started production of our HFO product.

Power Fleet Composition 9,666MW

Efficiency

Capital Efficiency

Measure

Rental Solutions utilisation; Industrial utilisation; Utility utilisation, order intake and off-hire rate.

Relevance

We are a capital intensive business and in order to generate strong returns on our capital investment our fleet needs to be well utilised. Across our businesses we use physical utilisation as a metric (average MWs on-hire divided by the total fleet size in MW).

Target

In our Rental Solutions and Power Solutions Industrial businesses we are targeting utilisation of between 60-70%, whilst in our Power Solutions Utility business we target over 80%.

Performance

In our Utility business we had a strong order intake and so ended 2016 very close to our target utilisation levels. The utilisation level of our diesel fleet in the last quarter of the year was actually at 83%, above our target. Rental Solutions had a difficult year, with the downturn in oil related sectors in North America impacting the utilisation level.

Power Solutions Industrial Utilisation 63%


Power Solutions Utility Utilisation 79%


Rental Solutions Utilisation 52%

People – Safety

Safety

Measure

Lost Time Injury Frequency Rate (LTIFR).

Relevance

Rigorous safety processes are absolutely essential if we are to avoid accidents or incidents which could cause injury to people and damage to property and reputation. The main KPI we use to measure safety performance is Lost Time Injury Frequency Rate (LTIFR) which takes the number of lost time injuries and divides by the number of man hours worked. A lost time accident is a work-related injury/illness that results in an employee’s inability to work the day after the initial injury/illness.

Target

Continued reduction in accident rates.

Performance

During 2016, the LTIFR rate increased. In our investigations we found the majority of the increase related to manual handling activities and so we have been working with an external service provider to develop a company specific manual handling programme which should reverse this trend.

Lost time injury frequency rate 0.45

People – Employee Satisfaction

Employee Satisfaction

Measure

Employee turnover.

Relevance

It is the attitude, skill and motivation of our people which makes the difference between mediocre and excellent performance. We monitor permanent employee turnover as a reasonable proxy for how employees feel. It is measured as the number of employees who left the Group (other than through redundancy) during the period as a proportion of the total average employees during the period.

Target

We aim to keep permanent employee turnover below historic levels in order to retain the skill base that we have developed.

Performance

This year employee turnover was 2% lower than the prior year.

Employee Turnover 9%

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