Many variables can impact pricing here:
- the size of the company: listed companies and multinationals with thousands of shareholders can budget more for this than a smaller/local company
- deadline: if its urgent it can get intense
- what they expect in the first stage: one design proposal or more?
- will you be doing 100% custom designs or be buying/customizing ready-made templates?
- number of text revisions after the initial draft. some clients will give you a proofed final text to work with, others will start with a draft and fine tune along the way
- number and detail of infographics (piecharts, graphs, maps, other visuals)
- amount of tables in the financial section. large tables can be very labour intensive. some companies will file very detailed financial info which can translate into large tables such as this or this
- price for stock photos if they dont have their own, and the time to hand pick these
- photo retouching: you could expect poor resolution and/or low quality photos of their properties or board members and you might be asked to clean this up which can take many extra hours
- will they want to receive a print ready PDF only, or will they also expect you to hand out the INDD source files. careful, this is tricky because having the source could allow them to replicate the design in-house or with a different provider in the future
- also note 40 pages could be an estimate. this could be what they have in Word, but not necessarily what you will end up with in InDesign. Depending on your formatting and the white space you use, this could turn to 30 or 60 pages (just examples)
Both per hour or per page fees options could work, depends on your previous experience with the client and personal preference. An hourly rate will keep you safe in case they will do repeated text changes along the way.
If you quote per page you should only give one single price per page, which will be an average between simpler text pages and more complicated graphic pages (covers, infographics, etc). No need to quote separately for the covers.
An annual report is annual, meaning they will need one every year, so if your work is good this could turn into a regular yearly project, with a possible smaller effort if you end up re-using some of the artwork next year.