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Responsible manufacturing in the UK

We remain committed to UK manufacturing and continued to invest in our two manufacturing facilities (Howden, East Yorkshire and Runcorn, Cheshire) during 2012. In July 2011 we announced that we would be investing some £20m in new facilities at these locations over a two year period and we firmly believe that investing in local manufacturing ensures that we can maintain the quality of our product, protects the long-term competitiveness of our business and benefits our communities.

During 2012, our UK-based manufacturing teams produced around:

• 3.5 million cabinets;
• 800,000 kitchen worktops and breakfast bars; and
• 2 million kitchen frontals.

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Managing our impact on the environment

Wood

Manufactured product

Given that wood based products are central to our business, we continue to set challenging targets for the responsible use of wood based products and paper products. Our rolling KPI to monitor the provenance of our wood based product is:

" To ensure that 100% of our wood based product used in our manufacturing processes comes from certified sources."

In 2012, we used 198,000 cubic metres of chipboard and 13,000 cubic metres of MDF in our manufacturing process. As has been the case every year since 2006, all of this came from certified sources.

We set similarly challenging targets for our use of cardboard packaging, with our KPI being that all packaging should be sourced from recycled or certified sources. In 2012 we used 3,100 tonnes of cardboard packaging all of which came from recycled sources. It is our intention to achieve a similarly high standard in the future.

All of the kitchen ranges which are manufactured at our factories are certified by the UK Forest Stewardship Council (UK FSC) and over 99% of all products we manufacture in-house are FSC compliant (2011: 99%).

Bought-in product

Ethical and environmental sourcing continues to be an important factor when we determine which suppliers we use. In order to ensure consistency with our manufactured product, we aim to source from suppliers who have similarly high standards and international accreditation.

• As part of our continuous improvement programmes all our key suppliers are regularly audited. The audit programme operates across some 14 countries and incorporates measures relating to Quality, Environment, Health & Safety, Employment and Business Continuity.
• In 2012, as in 2011, 92% of our European timber based product suppliers were certified as sourcing timber from a sustainable supply.
• Howden Joinery has been certified by the FSC and the European Programme for the Endorsement of Forest Certification (PEFC) since February 2008. At the end of 2012, 22 of our 40 kitchen ranges (55% of our kitchens) were fully compliant with FSC requirements (compared to 50% in 2011 and 43% in 2010). We aim to maintain a similar proportion in 2013.