www.genetix.com
GENETIX GROUP PLC • QUEENSWAY • NEW MILTON • HAMPSHIRE • BH25 5NN • T: +44 (0)1425 624600 • F: +44 (0)1425 624700
Genetix Group plc  Annual Report and Accounts 2004
Genetix Group plc
Annual Report and Accounts 2004 Genetix adds value to scientists working
at the cutting edge of Cell Biology,
Proteomics and Genomics through 
its pioneering development of
automated systems.
Our core skill is in the design, development
and manufacture of innovative systems
that meet the needs of our customers.
Our focus is on systems that reduce
the time and cost of introducing new
biopharmaceuticals.
Our products include instruments and
consumables that were used in the Human
Genome Project and are now used in
the genetic analysis of human diseases,
analysing the proteins of pathogenic
organisms and selecting cells for the
production of therapeutic proteins.
Genetix has established a broad and strong
customer base among many of the world’s
leading academic research groups, biotech
companies and pharmaceutical corporations.
01 Highlights
02 Focus on cell biology
04 Chairman’s statement
05 ChiefExecutive’s review
08 Financial review
09 Directors and company secretary
10 Scientific Advisory Board and Advisers
11 Directors’ report
14 Corporate Governance
17 Directors’ remuneration report
22 Independent auditors’ report
23 Consolidated profit and loss account
24 Consolidated and company balance sheets
25 Consolidated cash flow statement
26 Consolidated statement of total recognised
gains and losses
26 Reconciliation of movements in
consolidated shareholders’ funds
27 Notes to the accounts
41 Notice of Annual General Meeting
44 Five year summary ANNUAL REPORT & ACCOUNTS 2004 01
2004 Highlights
2000
3.6
2001
2.6
2002
2.3
2003
0.8
2004
1.2
2000
10.7
2001
12.4
2002
12.6
2003
10.8
2004
12.2
Proﬁt before tax £m
(excluding exceptionals and goodwill – see page 44)
Turnover by geographic
destination
Turnover £m
Ayear of good progress achieved within uncertain market conditions
•
Sales of £12.2 million up 13%; sales up 20% using 2003 average
US dollar exchange rate
•
Pre-tax proﬁt of £0.9 million up 103%
•
Major new products developed for cell biology applications
•
Greater focus on systems that accelerate drug development
•
Cash balance of £22.2 million
■ 55% North America
■ 14% United Kingdom
■ 22% Rest of Europe
■ 9% Rest of World Genetix is leading the way in speeding up the discovery
and development of biopharmaceuticals. The launch in
2004 of the ClonePix family, a new range of instruments,
allows biopharmaceutical producing cells to be selected
earlier in the process of drug development.
02 GENETIX GROUP PLC
Focus on cell biology
IMAGE AND SCREEN
Using ﬂuorescence imaging, ClonePix
FL
identiﬁes those colonies out of hundreds
that produce protein.
INCUBATE CELLS
Colonies of mammalian cells producing
an important pharmaceutical protein are
incubated and placed into the ClonePix
FL
.
1
2
Automated Mammalian Cell Picker ANNUAL REPORT & ACCOUNTS 2004 03
The instruments also allow the selection of cells using
quantitative criteria based on the pharmacological properties
of afﬁnity and speciﬁcity that determine whether a drug will
succeed or fail. This novel approach will dramatically reduce the
time and cost of introducing new biopharmaceutical products.
CELL IDENTIFICATION
Colonies are identiﬁed according to
criteria speciﬁed by the scientist.
ANALYSE AND SELECT
Using proprietary software, the ClonePix
FL
analyses the colony images to select the
cells of interest.
3
GROW CELLS
Individual colonies are then sub-cloned
to ﬁnd those which are most stable or
have the highest productivity and yield of
the therapeutic protein for scale-up
in a fermentor.
6
4
PICK AND DISPENSE COLONIES
Individual colonies are picked and
dispensed into wellplates with high
efﬁciency and high viability.
5 04 GENETIX GROUP PLC
Genetix has made good progress in a
difﬁcult year achieved against a backdrop
of uncertain market conditions. Excluding
the impact of the weak US dollar, sales
increased by 20% despite continuing
unpredictability and increasing lead
times for order placement. Proﬁt before
taxwas £0.9 million, up 103%. This was
a highly creditable performance and
afﬁrms the decisions we made over a year
ago to invest in our sales and marketing
effort and develop products for the
biopharmaceutical market. We now have
the chance to build upon the foundations
laid in 2004 and exploit the exciting new
opportunities opening up for our business.
In 2004, Genetix has had to adapt quickly
to meet the changing demands of our
customers. During the year we broadened
our range of products by launching
instruments targeted for use within the
biopharmaceutical sector. An example of
this is the ClonePix, where we made use
of our expertise in imaging, software and
engineering to accelerate the process
of identifying, analysing and selecting
mammalian cells. We aim to be at the
forefront of these exciting new sectors.
The new Strategic Business Unit structure
put in place last year has evolved as
the business needs have changed and
we have simpliﬁed our sales structure
wherever possible to clarify responsibilities.
The Chief Operating Ofﬁcer has taken direct
charge of US sales and is coordinating our
“team-based” sales approach, key to
successful exploitation of our new
products within the pharmaceutical sector. 
In the fourth quarter, we reduced our
headcount by 10% to maintain efﬁciency
across the business going into 2005. 
Genetix has come through a challenging
year by growing sales, cutting costs and
moving into new markets for its leading
edge systems – the coming year will be
exciting as the business seeks to establish
itself in these new markets. The initiatives
taken during 2004 combined with the
early enthusiasm shown for our new
products should lead to a progressive
improvement in sales and proﬁtability
in 2005.
We would like to thank all our staff
for their continuing hard work and
commitment over the past year.
John Morgan
Chairman
“The initiatives
taken during 2004
combined with the
early enthusiasm
shown for our
new products
should lead to
a progressive
improvement
in sales and
proﬁtability
in 2005.”
Chairman’s statement
John Morgan ANNUAL REPORT & ACCOUNTS 2004 05
IINTRODUCTION
Genetix achieved an encouraging increase
in turnover of 13% (20% at 2003 average
US dollar exchange rate) during the year,
beneﬁting from a healthy opening order
book. We faced difﬁcult trading conditions
during the third quarter but this was offset
by a strong sales performance towards the
end of the year. During the year we began
the process of strengthening our position
within the pharmaceutical market by
focusing on systems that accelerate drug
target validation and product development.
We believe these areas of strategic interest,
centred around our new cell biology
products, will provide a platform for
growth over the coming years.
THE MARKET/UNDERLYING TRENDS
Our customers continue to develop
new areas of drug development within 
the biotechnology and pharmaceutical
sectors based upon the increased focus
on new biopharmaceutical products. The
introduction of automation has increased
the number of drug targets and the next
keyphase is the selection and validation of
targets of sufﬁcient interest for further in-
depth study. Genetix is rising to this
challenge by focusing the majority of its
R&D effort on cell biology and protein
expression while modifying its sales
approach to promote these new
technologies. The opportunities are
exciting because this market is potentially
signiﬁcant and the customer base has
funding available for instruments that are
capable of delivering efﬁciency gains and
therefore, a rapid return on investment. 
PERFORMANCE REVIEW
Against this background, Genetix achieved
turnover of £12.2 million (despite the
adverse impact of a weaker US dollar
estimated at £0.8 million) and proﬁt
before tax and goodwill of £1.2 million,
after goodwill of £0.9 million.
Instrumentation sales were £9.2 million,
an increase of 25% on 2003, including a
strong performance from our picking range
of products. Consumables and services
turnover was £3.0 million, down 14%
on 2003, and we are working hard to
improve sales by broadening the product
range, launching new internally developed
products and improving the link
between our instrumentation and
our consumables. 
Having built up our sales and marketing
team at the end of 2003, we had forecast
a reduction in short-term proﬁtability in
2004 in order to achieve our longer-term
goals. We constantly review our operational
structure to respond to changing market
conditions and as a consequence, we
reduced our headcount by 10% towards
the end of 2004.
The Group ﬁnished the year with a cash
balance of £22.2 million.
SALES AND MARKETING
We have increasingly adopted a
“team-based” sales process made up of
multi-skilled scientists, engineers and
commercial staff to progress good sales
opportunities due to the increasing
sophistication of our customers’ needs. We
will further develop this team approach in
conjunction with key account management
to improve our order conversion and
provide better support to our customers.
In addition, we will be reviewing all our
distributor relationships to ensure their
suitability for a particular product or range
of products.
Chief Executive’s review
Mark Reid
>>>
“Our customers
continue to
develop new
areas of drug
development
within the
biotechnology and
pharmaceutical
sectors based 
upon the increased
focus on new
biopharmaceutical
products.” 06 GENETIX GROUP PLC
Chief Executive’s review
continued
UK sales were 21% higher than 2003 and
accounted for 14% of total sales, aided
by this team-based approach using the
resources and demonstration facilities at
New Milton. Sales to the rest of Europe
were 2% higher than 2003. As predicted
last year, the German market remained
depressed throughout 2004 but we expect
this to improve in 2005 as we introduce
our new cell biology products. In the US,
our largest and most important market,
sales were up 20% (34% at 2003 average
US dollar exchange rate) compared to the
previous year. In the rest of the world sales
fell by 10%, however, this region only
accounts for 9% of total sales but offers
good future growth prospects.
PRODUCT DEVELOPMENT
The main initiatives were:
•
development of the ClonePix
FL
,
our mammalian cell colony picker,
extending the ClonePix family of
cell biology products;
•
reﬁnement of the aQuire scanner,
adding a third blue laser to expand
the range of cell, tissue and protein
arrays imaged;
•
further development of the QArray
and QPix (the “XT” version) to increase
throughput and data quality;
•
development of a new plate system for
maximising protein expression; and
•
development of new reagents for cell
biology, proteomics and gene
expression.
RESEARCH AND DEVELOPMENT
R&D expenditure was maintained as 
we continued to develop our ultra 
high-throughput microarrayer, the
QArray
max
. In the second half of the year,
we focused on two new cell biology
projects – ClonePix
FL
and Clone
Select
–
both using our core skills in imaging,
picking, placing and bioinformatics. The
ClonePix
FL
uses ﬂuorescent technology
to produce a leading-edge instrument
capable of identifying, analysing and
selecting colonies of mammalian cells 
to increase the productivity of new
biopharmaceuticals. We have completed
our ﬁrst prototype instrument and have
received first orders from several blue-
chip pharmaceutical companies as “early-
adopters” of this exciting new technology.
The Clone
Select
system is complementary to
cell colony picking and addresses the
selection and sub-selection of cells with
different growth rates through the use of
advanced optics and imaging techniques.
R&D expenditure (excluding grant
recoveries) was £1.5 million (2003:
£1.4 million) including the QArray
max
project and the two new cell biology
projects. Work on our LINK project is now
nearing completion and will conclude at
the end of March 2005. The project has
raised the proﬁle of Genetix in the ﬁeld
of protein-protein interaction and the
technologies developed and experience
gained will be valuable as we develop our
know-how into new applications.
With effect from 1 November 2004,
R&D was split into two teams, focusing
primarily on two major projects, to
improve the concentration and
effectiveness of our R&D effort.
We continue to submit all potential
projects through our New Product
Development Committee to approve
their scientiﬁc and commercial viability
prior to development.
This year we have:
developed our range of products
to ensure they cover the full
range of applications and
processes used by our customers.
2004 Reagents
and Consumables
This year we have:
developed our family of
mammalian cell pickers and
extended the ability of our
successful ClonePix instrument.
2004 Picking ANNUAL REPORT & ACCOUNTS 2004 07
ACQUISITIONS
The primary focus of the Group remains
organic growth. However, we reviewed
various acquisition opportunities during
the year but did not progress any of these
projects beyond due diligence.
OUTLOOK
We remain positive about our prospects
for 2005 given the opportunities outlined
above. Genetix is a respected player in its
ﬁelds of expertise and aims to exploit this
to differentiate itself further from its
competitors and improve sales and
proﬁtability.
Our key priority in 2005 is to concentrate
activity on the potentially signiﬁcant
markets within cell biology and penetrate
these as quickly as possible.
Mark Reid
Chief Executive
“Our key priority in 2005
is to concentrate activity
on the potentially
signiﬁcant markets
within cell biology and
penetrate these as
quickly as possible.”
This year we have:
released a new generation
of our production scale,
ultra high-throughput
microarrayer, the QArray
max
.
2004 Microarraying
This year we have:
developed cell based
applications for our accurate,
low volume liquid dispenser,
the aliQuot.
2004 Liquid Handling
Chief Executive’s review
continued 08 GENETIX GROUP PLC
RESULTS
Group turnover was £12.2 million
(2003: £10.8 million); instrumentation
accounted for 76% (2003: 68%) and
consumables and services 24% (2003:
32%) of total sales. Turnover was adversely
affected by the weak US dollar, estimated
to be £0.8 million over the year (compared
to the average exchange rate in 2003),
offset by favourable forward exchange
contracts and translation gains of
£0.5 million which reduced the negative
impact on operating proﬁt to an estimated
£0.3 million.
The Group’s gross margin improved slightly
to 48% (2003: 47%), mainly due to
product mix.
Gross R&D expenditure was £1.5 million
(2003: £1.4 million); after taking credit
for grant recoveries of £0.4 million, 
the net spend was £1.1 million 
(2003:£1.2 million).
Sales and administrative expenses
increased mainly due to the investment
in our sales and marketing resource both
in the UK and US. Overall these factors
combined to produce an operating proﬁt
before goodwill of £0.3 million, operating
loss after goodwill of £0.1 million.
Interest receivable was £0.9 million
(2003: £0.8 million), reﬂecting an increase
in interest rates.
The Group’s effective tax rate was 7%
(2003: 16%), lower than the standard rate
of 30% due to the resolution of prior year’s
taxmatters with the Inland Revenue
(relating to allowable ﬂotation expenses)
and the continuing beneﬁt of the UK
government’s R&D tax credit scheme.
Basic earnings per share were 1.11p
(2003: 0.49p) based on a weighted
average of 71,698,688 shares in issue
during 2004. Adjusted earnings per share
(excluding goodwill) were 1.62p 
(2003: 0.99p).
CASH FLOW
The Group generated cash of £0.1 million
with higher working capital being offset
by higher interest received. Working capital
rose primarily due to the late timing of
sales during 2004. Cash ended the year at
£22.2 million (2003: £22.1 million). 
The Group paid tax of £0.2 million but
received a tax refund of £0.1 million,
leaving net tax paid of £0.1 million
(2003: £0.4 million tax paid).
Capital expenditure was £0.4 million
(2003: £0.2 million) of which £0.1 million
was on a new materials planning and
accounting system.
We employed 100 people worldwide
as at 31 December 2004 (31 December
2003: 104).
INTERNATIONAL FINANCIAL REPORTING
STANDARDS (IFRS)
The Group will be adopting IFRS with effect
from 1 January 2005. The main impact on
proﬁtability will be (a) the charge arising
from the implementation of IFRS 2 “Share
based payment”, (b) the beneﬁt arising
from the cessation of charging goodwill
amortisation on consolidation (assuming
no impairment in value), (c) the “marking
to market” of forward currency contracts
i.e. taking fair value gains or losses on
forward contracts (designed to hedge
income in the following ﬁnancial year)
in the current year, and (d) potential
capitalisation of speciﬁc R&D costs under
IAS 38 (rather than writing off all R&D
as incurred). A full reconciliation of all
adjustments arising from IFRS will be
disclosed within the Interim Report 2005.
EXCHANGE RATES
The results of the Group’s US and German
subsidiaries were translated into sterling
at average exchange rates of £/$ 1.8355
(2003: 1.6453) and £/€ 1.4725 (2003:
1.4427) respectively; the balance sheets
were translated at the year end exchange
rates of £/$ 1.9199 (2003: 1.7901)
and £/€ 1.4125 (2003: 1.4192). As at
31 December 2004, the Group was
committed to forward exchange contracts
totalling US$4,000,000 at an average rate
of £/$ 1.7574 and €1,200,000 at an
average rate of £/€1.4030, all maturing
before 31 December 2005.
Gary Corsi 
Finance Director
Financial review
Gary Corsi
“Turnover was
adversely affected
by the weak US
dollar, estimated
to be £0.8 million
over the year.” ANNUAL REPORT & ACCOUNTS 2004 09
Directors and company secretary
1 MARK REID
Chief Executive
Aged 49, founded Genetix in 1991,
formerly with KPMG, London. Former
director of Plastic Injection Limited
(now Unimark Plastics Limited), 
a supplier to the Group.
2 TREVOR BELL
Chief Operating Ofﬁcer
Aged 47, former managing director
(Northern Europe) of Remy Cointreau S.A.
in France, former director of global
commercial operations of Scholl plc
and former president of Schwinn Fitness
in the US.
41 2 3
65 7 8
3 GARY CORSI
Finance Director
Aged 47, former ﬁnance director
of speciality chemicals group, Inspec
Group plc.
4 DR JULIAN BURKE
Scientiﬁc Director
Aged 52, founded Genpak in 1993,
former Reader at the University of Sussex,
specialising in biochemistry and molecular
neurobiology. 
5 JOHN MORGAN
Non-Executive Chairman*
Aged 49, currently executive chairman of
construction group, Morgan Sindall plc. 
6 DR JAMES HILL
Non-Executive Director*
Aged 59, former head of strategic product
development and senior vice-president of
corporate affairs of SmithKline Beecham
until the merger with Glaxo Wellcome plc
in December 2000. Currently non-
executive director of Diplema plc. 
7 PETER JENSEN
Non-Executive Director*
Aged 54, former chairman of SmithKline
Beecham’s European Consumer Healthcare
operations and president of Worldwide
Supply Operations until the merger with
Glaxo Wellcome plc in December 2000.
Currently non-executive director of
Domino Printing Sciences plc and
Newmarket Racecourses Trust Limited.
8 SIMON HEDGER
Company Secretary
Aged 49, former company secretary and
executive committee member of News
Communications & Media plc.
* Member of Audit Committee and
Remuneration Committee SCIENTIFIC ADVISORY BOARD
Professor Eric Davidson, currently Norman Chandler
Professor of Cell Biology, Division of Biology, California
Institute of Technology, USA.
Dr Roger Bumgarner, research scientist at the
Department of Molecular Biology, University of Washington,
Seattle, USA.
Dr Rod Wing, director of the Arizona Genomics Institute,
Arizona, USA.
Dr Sue Richards, director of Genetix Limited, former brand
manager at Life Technologies Limited and Research Fellow
at the Cancer Research Campaign Beaston Institute.
Dr Julian Burke, see page 9.
REGISTERED OFFICE
Queensway
New Milton
Hampshire
BH25 5NN
COMPANY NUMBER
4024856
COMPANY WEBSITE
www.genetix.com
ADVISERS
Financial adviser and stockbroker
Panmure Gordon
a division of Lazard & Co., Limited
50 Stratton Street
London
W1J 8LL
Financial adviser
Piper Jaffray Ltd
Phoenix House, 1st Floor
18 King William Street
London
EC4N 7US
Auditors
Deloitte & Touche LLP
Mountbatten House
1 Grosvenor Square
Southampton
SO15 2BZ
Bankers
Barclays Bank plc
PO Box 612
Ocean Way
Southampton 
SO14 2ZP
HSBC Bank plc
Norwich House
Nelson Gate
Commercial Road
Southampton
S015 1GX
Financial PR
Financial Dynamics
Holborn Gate
26 Southampton Buildings
London
WC2A 1PB
Solicitors
Olswang
90 High Holborn
London
WC1V 6XX
Registrars
Lloyds TSB Registrars
The Causeway
Worthing
West Sussex
BN99 6DA
10 GENETIX GROUP PLC
Scientiﬁc Advisory Board and Advisers ANNUAL REPORT & ACCOUNTS 2004 11
Directors’ report
DIRECTORS’ REPORT
The directors present their annual report on the affairs
of the Group, together with the ﬁnancial statements and
auditors’ report for the year ended 31 December 2004. 
Reviews of the Company’s and the Group’s activities are
given in the Chairman’s statement on page 4, the Chief
Executive’s review on pages 5 to 7 and the Financial
review on page 8 which are to be regarded as part of this
report. The presentation of information before goodwill
amortisation has been shown because the directors
consider that this gives a useful indication of underlying
performance.
PRINCIPAL ACTIVITY
The principal activity of the parent Company and its trading
subsidiaries is the design, development, manufacture
and marketing of automated systems, services and
consumables for cell biology, proteomic and genomic
research throughout the world. 
RESULTS AND DIVIDENDS
The audited ﬁnancial statements for the year ended
31 December 2004 are set out on pages 23 to 40.
Proﬁt on ordinary activities after taxation was £0.8 million
(2003: £0.4 million). The directors do not recommend
the payment of a dividend (2003: £nil).
RESEARCH AND DEVELOPMENT
The development of new technology is an integral part of
the Group’s business and the Group continues to carry out
research and development in response to market needs
and demand from the scientiﬁc community. All such costs
are written off to the proﬁt and loss account as incurred.
PURCHASE OF OWN SHARES
At the Annual General Meeting held on 30 April 2004, the
Company was given authority to purchase its own shares.
At that time, the directors believed that it would be
desirable to have ﬂexibility to make such purchases in
appropriate circumstances, such purchases only being
made to improve earnings per share for shareholders
retaining their shares. No transactions for the purchase of
the Company’s own shares took place during the year.
Renewal of the authority will be sought from shareholders
at the forthcoming Annual General Meeting. Details of this
resolution are set out in the explanatory notes on page 43.
THE BOARD
The directors who served throughout the year were as follows:
M A Reid
T D Bell 
G S Corsi
Dr J F Burke
J C Morgan
Dr J F Hill
P S Jensen
Biographical details of all directors are provided on page 9.
G S Corsi and J C Morgan retire in accordance with the
Articles of Association and being eligible offer themselves
for re-appointment.
No director has a service contract of more than one year’s
duration.
Directors’ and ofﬁcers’ liability insurance cover is in place. 
DIRECTORS’ INTERESTS IN SHARES
The directors who held ofﬁce at 31 December 2004 had
the following beneﬁcial interests in the Company’s shares:
31 December 31 December
2004 2003
Number Number
M A Reid 42,551,267 42,551,267
T D Bell 10,000 –
G S Corsi 295,508 295,508
Dr J F Burke 1,306,766 1,506,766
J C Morgan 5,000,000 5,000,000
Dr J F Hill 18,796 18,796
P S Jensen 150,000 150,000
Full details of directors’ interests in approved and
unapproved share options, other option agreements and
savings related share options are disclosed in the directors’
remuneration report on page 20.
Notes:
1 The beneﬁcial holdings include holdings of spouses.
2 During the period 31 December 2004 to 21 February 2005 (being one
month before the date of the notice of the Annual General Meeting)
there were no directors’ share dealings. SUBSTANTIAL SHAREHOLDINGS
As at 21 February 2005, the Board had not been notiﬁed
in accordance with sections 198 to 208 of the Companies
Act 1985 of any member who had a notiﬁable interest in
the share capital of the Company.
CHANGES IN FIXED ASSETS
The changes in ﬁxed assets of the Group during the year
are set out in notes 10 to 12 on pages 32 and 33 of the
accounts.
ACCOUNTABILITY AND AUDIT
Within the Chairman’s statement on page 4 and the
detailed review of the Group’s performance in the Chief
Executive’s review on pages 5 to 7, and the Financial
review on page 8, the directors seek to present a balanced
and understandable assessment of the Group’s ﬁnancial
position and prospects. The directors’ responsibility for the
ﬁnancial statements is described below.
CORPORATE RESPONSIBILITY
The Company has formulated its approach to the ABI’s
guidelines on corporate responsibility within the Turnbull
process. These matters have been reviewed as part of the
Company’s ongoing risk assessment process and as a
consequence, the signiﬁcance of social, environmental
and ethical (SEE) matters to the business of the Group is
now regularly reviewed. Through this process the Board
receives adequate information to make an assessment of
such matters and in this context no signiﬁcant risks have
been identiﬁed. 
In view of the relatively small size of the Group and the
absence of heavy industry within its manufacturing
processes, the environmental footprint of the Group is not
signiﬁcant. Notwithstanding this, the Group is committed
to embracing sound environmental policies and practices.
An environmental policy has been issued to all staff and
key suppliers. A framework has been established allocating
responsibilities for the implementation of the policy and
enabling the performance of the Group in adhering to its
policy to be monitored. Environmental matters may be
addressed by staff via the Group’s intranet. The Company
has also developed codes of conduct which have been
incorporated within staff handbooks which include
sections codifying the Company’s position on promoting
high standards of integrity and ethics in business conduct
and encouraging diversity in the workplace. The Group’s
principal operations are located within a single light
manufacturing unit in the UK and are not exposed to
the same risks associated with human rights faced by
companies who operate in developing countries. It is
believed that the Group’s exposure to risks arising from
SEE matters are principally reputational and that there
are real business advantages to enhancing and protecting
the reputation of the Group in terms of attracting and
retaining talented staff and enhancing its proﬁle with
an increasingly demanding customer base.
The Group recognises that business activities have an
inﬂuence on the community and accepts that it has a duty
to carry out these in a responsible manner. In addition, the
Group seeks to support education in its ﬁeld of operations
by engaging sandwich students during their industrial
year, work experience assignments and educational visits.
While the Group has complied with its policies and
procedures for managing risks arising from SEE matters,
it is the intention to continue to develop those relating
to the environment further in the ensuing year.
These disclosures have been compiled in conjunction with
the risk assessment exercise carried out in December 2004
and veriﬁed as part of that process.
In view of the relatively small size of the Group and the
need to manage risks proportional to their signiﬁcance,
there is no present intention to introduce any
remuneration incentive relating to the handling of
SEE risks or training of directors on such matters. 
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
United Kingdom company law requires the directors
to prepare ﬁnancial statements for each ﬁnancial year
which give a true and fair view of the state of affairs
of the Company and of the Group and of the proﬁt or
loss for that year.
In preparing those ﬁnancial statements, the directors are
required to:
• select suitable accounting policies and then apply
them consistently;
• make judgements and estimates that are reasonable
and prudent; and
• state whether applicable accounting standards have
been followed, subject to any material departures
disclosed and explained in the ﬁnancial statements.
The directors are responsible for keeping proper accounting
records which disclose with reasonable accuracy at any
time the ﬁnancial position of the Company and to enable
them to ensure that the ﬁnancial statements comply
with the Companies Act 1985. They are also responsible
for safeguarding the assets of the Company and hence for
taking reasonable steps for the prevention and detection
of fraud and other irregularities.
12 GENETIX GROUP PLC
Directors’ report continued SUPPLIER PAYMENT POLICY
It is the Group’s policy to pay suppliers in accordance
with their agreed terms and conditions. Such terms and
conditions are agreed with the supplier in advance
and the Group aims to comply with such terms once
satisfactory performance is achieved. At 31 December 2004
average creditors’ age was 50 days (2003: 53 days).
EMPLOYMENT OF DISABLED PERSONS
In considering applications for employment from disabled
people the Company seeks to ensure that fair consideration
is given to the abilities and aptitudes while having regard
to the requirements of the job for which he or she has
applied. Employees who become unable to carry out the
job for which they are employed are given individual
consideration and depending on the nature, severity
and duration of the disability, may be considered for
alternative work.
HEALTH, SAFETY AND THE ENVIRONMENT
The Group is committed to the maintenance of high
standards of practice concerning the health and safety of
its employees. The Group recognises its legal obligations
in this respect and compliance with such obligations and
a number of policies on such matters are monitored
through a health and safety committee. The Company is
sensitive to the needs of the environment. Such matters
are considered in the context of the Company’s
environmental policy which is described within the
section dealing with corporate responsibility. 
EMPLOYEE INVOLVEMENT
The Company is committed to a policy of developing
employee involvement and awareness on matters of
concern to all employees throughout the Group,
information being disseminated through formal and
informal meetings, written communications and notices. 
Consultation procedures exist with staff covering such
matters as health and safety and other areas connected
with their employment.
The Company has established discretionary and sharesave
share option schemes with the objective of giving
employees an opportunity to invest in the future of the
Company, encouraging a sense of involvement and
aligning employees’ interests with those of shareholders.
CHARITABLE AND POLITICAL DONATIONS
No charitable donations or political donations were made
during the year.
AGM
The notice describing the ordinary and special business at
the Company’s ﬁfth Annual General Meeting to be held on
Wednesday 27 April 2005 is set out on pages 41 and 42.
Details of the special business are set out on page 43.
Biographical details of directors submitting themselves for
re-appointment are set out on page 9.
AUDITORS
Deloitte & Touche LLP have expressed their willingness
to continue in ofﬁce as auditors and a resolution to
re-appoint them will be proposed at the forthcoming
Annual General Meeting. 
By order of the Board
S C Hedger
Secretary
1 March 2005
ANNUAL REPORT & ACCOUNTS 2004 13
Directors’ report continued 14 GENETIX GROUP PLC
Corporate Governance
The Company is committed to the principles of corporate
governance contained in the Combined Code on Corporate
Governance which is appended to the Listing Rules of the
Financial Services Authority (“the 2003 FRC Code”) and
for which the board is accountable to shareholders. In
applying these principles the Board has had regard to
the size and speciﬁc requirements of the Company.
COMPLIANCE
Throughout the year ended 31 December 2004, the
Company has been in compliance with the Code provisions
set out in Section 1 of the Combined Code on Corporate
Governance issued by the Financial Reporting Council in
July 2003 except for the following matters:
Code provision A.4.1: In view of the relatively small size
of the Group and Board a separate nomination committee
has not been constituted however, the Board will operate
under speciﬁc and formal terms of reference when
considering Board nomination matters.
Code provision C.3.1: In view of the relatively small size
of the Group and the consequential transparency of its
ﬁnancial affairs and ﬁnancial statements the Board
considers that the appointment of an additional non-
executive director with ﬁnancial experience, as deﬁned by
the Code, to sit on the Audit Committee is not necessary.
Furthermore, in view of the size of Mr Morgan’s
shareholding in the Company he would not be regarded as
an “independent” non-executive director by the
deﬁnition employed by the Code. It is the Board‘s view
that this does not lessen the value of his contribution as a
member of the Audit Committee.
Code provisions A.6.1/A.7.2: While a programme for a
performance evaluation for the Board and Committees
has been put in place it is intended that the performance
evaluation for individual directors be introduced during
the ensuing year. While the directors seeking re-election
have not been subject to a formal performance evaluation
the Board is satisﬁed that they continue to be effective and
are able to demonstrate commitment to their roles.
Code provision B.2.2: In view of the relatively small size
of the Group and the absence of management tiers
within the organisation the terms of reference for the
Remuneration Committee include authority to review and
advise on remuneration for the level of senior managers
below Board rather than consider and recommend.
THE BOARD
The Company is controlled through the Board which
comprises four executive and three non-executive
directors. The Board is chaired by Mr John Morgan. There is
a clear division of responsibilities between the Chairman
and the Chief Executive. Separate terms of reference for
these positions and for the position of Chief Operating
Ofﬁcer have been formally adopted by the Board.
During the year the Board held seven meetings, including
a strategy meeting. There is a formal schedule of matters
reserved for its consideration. It is responsible to
shareholders for the strategic development of the Group,
maximisation of performance by the efﬁcient use of
resources and the overall control of the operation of the
business. In fulﬁlling this responsibility the non-executive
directors ensure that the strategic plans are rigorously
reviewed by the Board and that the performance of
management in its execution of plans to achieve agreed
goals is closely monitored. 
The Board approves the Group’s annual operating plan
and throughout the year reviews the performance of the
business units and key performance indicators against
their budgets, targets and objectives. Through separate
terms of reference, the Chief Executive and Chief Operating
Ofﬁcer have speciﬁc responsibilities which include the
development and implementation of corporate objectives
and policies consistent with the Company’s strategy and
development of business plans in relation to these
commercial aims for which additional members of the
management team are given responsibilities. The Board
has carried out an evaluation of its effectiveness and
performance and of its committees and will carry out this
evaluation programme on an annual basis. The evaluation
took the form of a detailed questionnaire which was
responded to on an individual basis by each director,
the results of which being analysed under different
performance criteria identifying where improvements
may be made. The evaluation, which was reviewed by
the Board, included the role and constitution of the
Board, agenda setting and the quality of the information
provided to the Board. The Board is committed to
extending the annual evaluation to individual directors
during the ensuing year. The Chairman holds at least one
meeting a year with the other non-executive directors
without the executive directors present. In addition,
the senior independent director, Dr James Hill, holds
one meeting a year with his fellow independent director,
Mr Peter Jensen, without the Chairman present. 
During the year, the directors attended the following
number of meetings of the Board and its Committees:
Number of meetings
BoardAudit Remuneration
Committee Committee
John Morgan 7 2 3
James Hill 7 2 3
Peter Jensen 7 2 3
Mark Reid 7 – –
Trevor Bell 7 – –
Julian Burke 7 – –
Gary Corsi 7 – –
Although the directors possess a wealth of diverse business
experience they attend relevant training courses as
appropriate. New non-executive directors are offered an
appropriate induction programme under the direction of
the Chairman and Chief Executive and subsequent training is available to meet particular needs. While there is no
formal programme for new non-executive directors to
meet major shareholders there are opportunities for them
to do so particularly at the time of the Company’s Annual
General Meeting. 
The Chairman is responsible for ensuring that all directors
receive accurate, timely and clear information and ensures
that the Board is able to discharge its duties effectively.
All directors have access to the advice and services of the
Company Secretary. There are procedures in place which
allow directors to take independent professional advice in
the furtherance of their duties.
There are two independent non-executive directors on
the Board who are of varied business backgrounds who
individually and collectively exercise independence and
bring a diversity of business perspective. Notwithstanding
Dr Hill’s interest in share options granted on appointment
disclosed on page 20 the Board considers that, particularly
in view of the relatively small size of that interest, Dr Hill is
independent of the management and free from business
and other relationships that could interfere with his
independent judgement. Mr Morgan has an interest in the
Company amounting to approximately 7% of the issued
share capital and accordingly would not be regarded as an
“independent” non-executive by the deﬁnition employed
by the Code. It is the view of the Board that this does not
lessen the value of his contribution on the main Board nor
as a member of the Board Committees.
The terms and conditions of appointment of non-
executive directors, which are subject to the terms of
the Company’s Articles of Association, are available for
inspection at the Company’s registered ofﬁce during
normal business hours and at the AGM (for 15 minutes
prior to the meeting and during the meeting). The
standard terms and conditions of appointment are
available on the Company’s website (www.genetix.com).
All non-executive directors have indicated that they have
sufﬁcient time to meet the expectations of their
appointments.
The Board has delegated certain responsibilities to the
Audit Committee and Remuneration Committee. Through
the Remuneration Committee the Company maintains
contact as required with principal shareholders on issues
relating to directors’ remuneration. The Board operates
under formal terms of reference, which are available on
the Company’s website, when acting as a nomination
committee. The Board has not been required to operate
under these terms since they were adopted with no new
appointments to the Board being contemplated since that
time. The Board also delegates a number of procedural
responsibilities in relation to minor drafting requirements
associated with routine ﬁnancial statements and
announcements to an ad hoc Committee of the Board.
AUDIT COMMITTEE
The Audit Committee is chaired by Mr Peter Jensen
and during the year under review held two meetings.
During the year the Committee comprised all of the
non-executive directors two of which are regarded as
“independent” non-executive directors by the deﬁnition
employed by the Code. All directors are normally invited to
attend Committee meetings together with the external
auditors and the Company Secretary. 
The Committee’s terms of reference, which are available
on the Company’s website, set out the Committee’s
responsibilities, which it has fulﬁlled during the year
under review, and include:
• reviewing ﬁnancial statements, the effectiveness of the
Company’s ﬁnancial reporting, internal controls and risk
management;
• making recommendations to the Board in relation to the
appointment, re-appointment and removal of external
auditors;
• reviewing the independence and objectivity of external
auditors;
• reviewing the results of the audit and the effectiveness
of the audit process;
• review consistency of accounting policies and
compliance with accounting standards; and
• review of non-audit services provided by
external auditors.
In fulﬁlling its responsibilities the Committee has:
• sought conﬁrmation from the external auditors of the
absence of any factors which could have a material
consequence affecting the integrity of the Company’s
ﬁnancial statements;
• reviewed the methodology and results of the Company’s
risk assessments;
• reviewed the independence of the external auditors
by examining the contents of a formal letter of
independence produced by the auditors; and
• assessed the effectiveness of the external audit by
meeting with the auditors for the consideration of a
number of relevant matters which include the scope of
their work, matters of materiality, misstatements, key
accounting practices, taxation issues and accounting
and internal control systems.
The Committee chairman also holds separate discussions
with the external auditors without management being
present. 
The Committee has a policy whereby if the provision of
non-audit services is likely to cost more than £75,000,
or £100,000 in the event of a single transactional fee,
alternative sources for those services are considered. 
When considering the recommendation for the continual
appointment of the existing auditors the Committee has
regard to the effectiveness of the audit and the relative low
cost of the audit services for a small company against costs
associated with changing auditors.
ANNUAL REPORT & ACCOUNTS 2004 15
Corporate Governance continued The Committee has reviewed the Company’s
whistleblowing procedures whereby staff may raise
public issue concerns including ﬁnancial improprieties.
REMUNERATION COMMITTEE
The Director’s Remuneration report is set out on pages
17 to 21. 
INTERNAL CONTROL
The Board has applied principle C.2 of the Combined Code
and in so doing has followed the guidelines for directors
on this requirement which were published in September
1999 (“the Turnbull Guidelines”). The Board conﬁrms that
the procedures necessary to implement the guidelines
have been established for the whole year and up to the
date of approval of the annual report and accounts.
The Board is responsible for the Group’s systems of internal
controls and has reviewed their effectiveness. Such
systems are designed to manage rather than eliminate the
risk of failure to achieve business objectives and can only
provide reasonable and not absolute assurance against
material misstatements or loss. Such systems have been
designed to meet the Group’s particular needs and
circumstances and the risks to which it is exposed.
The key procedures that have been established to provide
effective internal controls are:
Risk assessment 
As part of the Company’s compliance with the Turnbull
Guidelines, there is an ongoing process for identifying,
evaluating and managing risks and a system of risk
assessment. The assessments designed to identify
strategic, ﬁnancial, compliance and operational 
risks across all areas of the Company’s business are
systematically reviewed by the executive management
having regard to changes to the Group’s business
environment. In particular, the Chief Operating Ofﬁcer
addresses commercial risks at the time the Company’s
operating plan is compiled in close consultation with
senior business managers. The results of this exercise are
formally reported to the Board.
Control environment
The Board sets the overall risk management policy for the
Group which is delegated to the executive management.
The Group has taken the opportunity in adopting the
Turnbull guidance to underpin the principles of total
quality management to more effectively manage the
business and embed internal controls and risk
management further into the operations of the business.
Given the relatively small size of the Group, the senior
management is able to demonstrate through its own
actions, commitment to best business practices. In terms
of the Group approval framework, there are procedures
for expenditure matters including the authorisation of
investments and capital expenditure. The Group has in
place an organisational structure with deﬁned lines of
responsibility and delegations of authority. Upon joining
the Company employees undergo a thorough induction
programme and receive a staff handbook.
Information and communication
The Group’s procedures include a comprehensive system
for reporting ﬁnancial and non-ﬁnancial information to
the Board. This includes the preparation and review of
annual business plans and periodic strategic reviews
which are submitted to the Board, the comprehensive
review of the business at each board meeting, the monthly
meeting of the management committee and the regular
review of risk assessments and strategic risk. From time to
time the Board receives presentations from management
about key areas of the Group’s operations.
Control procedures
Accounting policies and practices are disseminated
throughout the Group. Measures taken include
comprehensive signing-off approvals, physical controls,
segregation of duties, reviews by management and
external auditors. Operational procedures are under
continual development having particular regard to
changes in the law and regulations and managers’
handbooks are updated accordingly.
Monitoring process
There are clear procedures for monitoring the system 
of internal controls:
The Chief Executive and members of the management
team regularly review the results of the risk assessment
exercise. The impact and likelihood are re-evaluated and
priorities reported to the Board and where appropriate,
corrective action taken.
Each half-year, the Finance Director carries out an internal
self-certiﬁcation of accounting functions requiring staff
to actively evaluate ongoing compliance with ﬁnancial
control disciplines.
The Audit Committee considers that given the relative small
size of the Group and the quality of ﬁnancial controls, the
appointment of an internal auditor is not merited.
RELATIONS WITH SHAREHOLDERS
The Company acknowledges the importance of a dialogue
with its institutional shareholders. The Company makes
presentations to them and communicates regularly
throughout the year. All shareholders have an opportunity
to discuss the Group’s development and performance at
the Annual General Meeting. The Company’s brokers
provide brieﬁng notes arising from institutional
shareholders’ feedback to the Company’s presentations
which are provided to all members of the Board.
GOING CONCERN
After making enquires, the directors have a reasonable
expectation that the Group has adequate resources to
continue operating for the foreseeable future. For this
reason, the going concern basis continues to be adopted
in preparing the ﬁnancial statements.
16 GENETIX GROUP PLC
Corporate Governance continued INTRODUCTION
This report has been prepared in accordance with the
Directors’ Remuneration Report Regulations 2002 which
introduced new statutory requirements for the disclosure
of directors’ remuneration in respect of periods ending 
on or after 31 December 2002. The report also meets the
relevant requirements of the Listing Rules of the Financial
Services Authority and describes how the Board has
applied the Principles of Good Governance relating to
directors’ remuneration. As required by the Regulations, 
a resolution to approve the report will be proposed at the
Annual General Meeting of the Company at which the
ﬁnancial statements will be approved.
The Regulations require the auditors to report to the
Company’s members on the “auditable part” of the
directors’ remuneration report and to state whether in
their opinion, that part of the report has been properly
prepared in accordance with the Companies Act 1985
(as amended by the Regulations). The report has therefore
been divided into separate sections for unaudited and
audited information.
Unaudited information
REMUNERATION COMMITTEE
The membership of the Remuneration Committee (“the
Committee”) is wholly made up of non-executive directors
namely Dr Hill (Chairman), Mr Morgan and Mr Jensen.
Dr Hill and Mr Jensen are regarded as “independent” non-
executive directors by the deﬁnition employed by the
Code. Members of the Committee are in attendance at the
Company’s Annual General Meetings. The Committee is a
committee of the Board and has been established with
formal terms of reference approved by the Board. The
Committee has authority to determine the remuneration,
beneﬁts and employment conditions for executive
directors and in this connection the Committee meets as
required and sets the policy for the administration of the
Company’s approved and unapproved share option
schemes. The Chief Executive and Company Secretary
attend meetings of the Committee at its invitation.
REMUNERATION POLICY
The Remuneration Committee is chaired by Dr Hill and met
three times during the year. The Committee comprised all
of the non-executive directors. The terms of reference of
the Committee are available on the Company’s website
(www.genetix.com). The responsibilities of the Committee
include the following:
•
to develop a broad remuneration policy for senior
management;
•
to determine the total individual remuneration
packages for each of the executive directors; and
•
to determine targets for performance related pay
schemes.
In addition to the foregoing, by operation of the rules of
the schemes, the Committee administers the operation of
the Approved and Unapproved Share Option Schemes.
The Committee seeks to put into place remuneration
packages which will enable the Company to motivate,
attract and retain executive directors of sufﬁcient calibre
to contribute to the development of the business and the
Group’s progress. In developing remuneration policy
and ﬁxing remuneration, consideration is given to
remuneration packages of executive directors in groups of
a comparable size. As part of this process, the Company
both participates in, and subscribes to, relevant
independent survey reports. The current remuneration
policy has regard to the early stage in the Group’s
development. As the Group grows in size and complexity
the Committee will consider the introduction of broader
remuneration packages. The relative importance of the
component parts of the remuneration packages will be
determined as the Group grows, until that time the focus
of relating the remuneration packages to performance is
performance related share options as described in this
report. The Committee has established a performance
related bonus scheme for the Chief Operating Ofﬁcer as
part of his recruitment package, the details of which are
set out below. The Chief Executive advises the Committee
on executive directors’ remuneration and on individual
performance other than for himself. The Committee having
regard to the global nature of the Group’s markets will, on
a case by case basis, be mindful of the speciﬁc demands
of the job market in a particular country or region should
the Group’s development require the international
recruitment of senior executives. No director is involved
in determining their own remuneration. The Committee’s
present policy is to offer executive directors six month
rolling contracts being comfortably in accordance with 
best practice. The main Board has established the policy
for directors’ fees, within the limits provided for by the
Articles of Association, having regard to the need to attract
non-executive directors of sufﬁcient calibre to provide
strategic drive and vision for the Group’s ongoing
development. In appropriate circumstances, non-
executive directors will be offered shares in lieu of a
proportion of their fee entitlement. 
BASIC SALARY
The basic salary for each executive director is established
by the Committee and is reviewed on an annual basis
in accordance with the terms of service contracts. Such
reviews will take into account the responsibilities
and experience of each individual and have regard to
appropriate sources of data including independent
surveys on similar positions held in comparable
companies. Reviews would also take place in the
event of major organisational change.
ANNUAL REPORT & ACCOUNTS 2004 17
Directors’ remuneration report 18 GENETIX GROUP PLC
Directors’ remuneration report continued
BENEFITS IN KIND
At the date of this report, directors do not receive beneﬁts
in kind. The Committee will keep this matter under review
as the Group develops.
ANNUAL BONUS
The Committee will continue to review the merits of
establishing an annual bonus scheme based on annual
and longer-term performance measures of the Group as
it develops. In the case of the Chief Operating Ofﬁcer, the
Committee agreed that as part of his recruitment package
he should participate in an annual bonus scheme. The
scheme provides the Chief Operating Ofﬁcer with an
opportunity to achieve an annual bonus of up to 50%
of his salary payable half-yearly against agreed targets
established by the Committee. The scheme includes
measurable and quantitative criteria related to the
ﬁnancial performance of the Group namely turnover
and operating proﬁt targets linked to the annual
operating plan. In exceptional circumstances, the
Committee would consider the payment of a special
bonus where an individual director’s performance
merits an award outside the annual bonus scheme.
COMPENSATION FOR LOSS OF OFFICE
During the ﬁnancial period under review, no payment has
been made to a former director as compensation for loss of
ofﬁce. The duty to mitigate will be taken into consideration
as appropriate when determining any severance payment.
SUMS PAID TO THIRD PARTIES IN RESPECT OF DIRECTORS’ SERVICES
During the ﬁnancial period under review, no payment was
made to a third party in respect of directors’ services. 
PENSIONS
At the date of this report, there are no pension
arrangements in force provided by the Company for
directors. The Committee will continue to keep this
under review as the Group develops.
SERVICE CONTRACTS
Details of service contracts for executive directors who
served during the ﬁnancial year can be summarised
as follows: 
Date of commencement Unexpired term
M A Reid 01/10/00 6 months
T D Bell 15/09/03 6 months
G S Corsi 01/08/00 6 months
Dr J F Burke 01/07/01 6 months
Each contract is for a six months rolling term and subject to
a six month notice period. 
No ﬁxed contractual sum is payable on termination.
Other than in cases of gross misconduct and protracted ill-
health provided for in their individual service contracts, all
executive directors would at present have an expectation
of a termination payment not exceeding six months salary
in the event of the early termination of their service
contract by the Company. No termination payments have
been made to former directors. Non-executive directors’
appointments are subject to letters of appointment which
provide for the terms of appointment to be reviewed on an
annual basis at the time of their respective anniversary of
appointment. Prior to that time either party may terminate
the appointment by giving not less than three months
notice. The commencement dates for non-executive
directors’ current terms of appointments are as follows:
J C Morgan 11/10/04
Dr J F Hill 05/02/05
P S Jensen 23/12/04
All directorships are subject to the overriding provisions of
the Company’s Articles of Association and the requirement
to seek re-election by shareholders at general meetings at
required intervals.
The Company recognises that its executive directors may
be invited to become non-executive directors of other
companies and that exposure to such non-executive
duties can broaden a director’s experience to the beneﬁt
of the Company. Each case is considered on its own merits.
SHARE OPTIONS
The Company believes that share ownership by executive
directors and other senior and keystaff establishes a ﬁrm
link between their personal interests and those of the
shareholders. The executive directors are eligible to
participate in the Company’s approved and unapproved
share option schemes which were established in October
2000. It is intended that the granting of the options is
phased over the life of the schemes. The Committee has,
following discussions with its advisers, formulated an
eligibility policy for executive directors which spreads the
potential grant of options throughout the ten year life of
the schemes. At present the maximum value of options
under this policy which may be awarded to executive
directors would be subject to a ceiling of options to the
value, at the time of grant, equating to four times salary,
with a maximum value of one times salary in any one
year. Options granted pre-ﬂotation are excluded from the
calculations. In considering the recruitment needs of the
Board, the Committee will have regard to the speciﬁc
demands of the job market at the time and in special
cases, having particular regard to internationally based
positions, consider the acceleration of such option
awards in appropriate circumstances. In the case of the
recruitment of the Chief Operating Ofﬁcer, in order to
secure the appointment of an individual of the required
calibre with the appropriate depth of commercial
experience, it was necessary to waive the principle of
phasing for both ordinary and super options. Option awards are normally considered by the Committee
following the publication of annual results and interim
results and if appropriate, granted during a 42 day period
following the announcement of those results. Other than
on recruitment, option awards outside these time frames
would not normally take place unless exceptional
circumstances prevail. 
Super options are subject to more demanding performance
conditions and are granted on a case-by-case basis to deal
with speciﬁc business needs. These options are subject to
a maximum ceiling of four times salary during the life of
the schemes and normally a maximum value of one
times salary in any one year. As in the case with ordinary
options, the Committee will have regard to the speciﬁc
demands of the job market and consider the acceleration
of such option awards in appropriate circumstances. The
performance target in respect of the super options granted
to the Chief Operating Ofﬁcer is the percentage growth in
adjusted EPS (adjusted for exceptional items and goodwill)
of the Group during a performance period of ﬁve years to
exceed the percentage growth in RPI during the period by
a minimum of 35% p.a. in which case 50% of the options
will vest. Compound percentage growth of 40% p.a. and
45% p.a. is required before 75% and 100% respectively
vest. The performance in aggregate is calculated over the
ﬁve year period to determine whether the shares under
option are exercisable whereby under performance in any
one year or years may be clawed back by over performance
in other years during the ﬁve year period.
The ﬁrst tranche of options which were granted to
executive directors and other key staff immediately before
admission to trade on the London Stock Exchange were not
subject to performance criteria. The grant of these options
was considered a necessary step to attract and retain staff
during a signiﬁcant period in the Company’s development.
Options granted subsequently, not regarded as super
options, are subject to performance criteria which were
chosen after discussions with the Company’s advisers
as being appropriate for the Company without a clearly
identiﬁable peer group at its early stage of development.
The vesting of such options is stepped in proportion to
the increased performance of the Group. The performance
target is the percentage growth in adjusted EPS (adjusted
for exceptional items and goodwill) of the Group during
the performance period of three years to exceed the
aggregate percentage growth in RPI during the period
by a minimum of 9% in aggregate in which case 50% of
the option will vest. Percentage growth of 12% and
15% is required before 75% or 100% respectively vest.
If the performance conditions are not achieved in the
initial three year period, the performance period will be
extended to ﬁve years and in such circumstances the
performance target is increased proportionally to reﬂect
the additional time available. If the performance condition
is not met within ﬁve years, the options will lapse.
Methods of reviewing whether these performance
conditions have been met are, in view of their simplicity,
largely mechanistic in nature and will at the appropriate
time of potential vesting of options be examined in
conjunction with the Company’s advisers.
PERFORMANCE GRAPH 
The following graph shows the Company’s performance,
measured by total shareholder return, compared with
the performance of the Techmark All-share Index also
measured by total shareholder return. The Company
forms part of this index and in the absence of a direct
peer group, this index is regarded as appropriate for
comparative purposes. 
ANNUAL REPORT & ACCOUNTS 2004 19
Directors’ remuneration report continued
2001 2002 2003 2004
0
20
40
60
80
100
120
140
160
180
FTSE TECHMARK ALL-SHARE – TOTAL RETURN INDEX
GENETIX – TOTAL RETURN INDEX
Source: DATASTREAM    
Return index since ﬂotation in November 2000 for Techmark All–share Index as at 31 December 2004 20 GENETIX GROUP PLC
Directors’ remuneration report continued
Audited information
DIRECTORS’ SHARE OPTIONS
Options granted to directors under the Genetix Group plc (Approved) and (Unapproved) 2000 Share Option Schemes, other
option agreements and the Sharesave Scheme 2000 are set out as follows:
At 1 Jan At 31 Dec Exercise
Note 2004 Granted Lapsed 2004 price Normal exercise period
M A Reid
Executive (unapproved) 1 66,667 – – 66,667 150p 24 Nov 2003 – 23 Nov 2010
Executive (unapproved) 2 97,744 – – 97,744 66.5p 5 Mar 2005 – 4 Mar 2012
164,411 – – 164,411
T D Bell
Executive (approved) 2 58,252 – – 58,252 51.5p 15 Sep 2006 – 14 Sep 2013
Executive (unapproved) 2 640,777 – – 640,777 51.5p 15 Sep 2006 – 14 Sep 2013
Executive (unapproved)
Super Options 3 1,242,718 – – 1,242,718 51.5p 15 Sep 2008 – 14 Sep 2013
Sharesave – 19,620 – 19,620 50p 1 Jun 2009 – 1 Dec 2009
1,941,747 19,620 – 1,961,367
G S Corsi
Executive (approved) 1 20,000 – – 20,000 150p 24 Nov 2003 – 23 Nov 2010
Executive (unapproved) 1 46,667 – – 46,667 150p 24 Nov 2003 – 23 Nov 2010
Executive (unapproved) 2 97,744 – – 97,744 66.5p 5 Mar 2005 – 4 Mar 2012
Sharesave 17,757 – – 17,757 53.5p 1 Jun 2005 – 1 Dec 2005
182,168 – – 182,168
Dr J F Burke
Options 1 66,667 – – 66,667 150p 11 Nov 2003 – 10 Nov 2010
Executive (approved) 2 45,112 – – 45,112 66.5p 5 Mar 2005 – 4 Mar 2012
Executive (unapproved) 2 52,632 – – 52,632 66.5p 5 Mar 2005 – 4 Mar 2012
Sharesave 17,757 – – 17,757 53.5p 1 Jun 2005 – 1 Dec 2005
182,168 – – 182,168
Dr J F Hill
Options 4 13,856 – – 13,856 216.5p 4 Feb 2002 – 7 Mar 2011
Notes:
1Share options granted prior to ﬂotation with no performance conditions. (At this time Dr Burke, while a director, was not an employee and as a
consequence options were not granted under the rules of the Company’s share option schemes but with reference to a separate option deed, all principal
terms being based on those contained within the Company’s schemes.) 
2Share options granted subject to standard performance conditions as set out in the policy statement on share options on page 19. If the performance
condition is not achieved within the required time scale, the share options will lapse prior to the expiry date. There has been no variation in the
performance conditions. The normal exercise period shown on the above table ends with the expiry date of the options.
3Share options granted subject to super option performance conditions as set out in the policy statement on share options on page 19. If the performance
condition is not achieved within the required time scale the share options will lapse prior to the expiry date. There has been no variation in the
performance conditions. The normal exercise period shown on the above table ends with the expiry date of the options.
4Share options granted to non-executive director at time of initial appointment and not subject to performance conditions.
5 No variation has taken place in the terms and conditions of any share option since its grant.
6Other than Mr Reid (as a substantial shareholder), all executive directors are entitled to participate in the Company’s Sharesave scheme.
7 The market price of the ordinary shares covered by these options as at 31 December 2004 was 46.5p. During the ﬁnancial year the highest and lowest
market prices were 58.5p and 44p respectively.  ANNUAL REPORT & ACCOUNTS 2004 21
Directors’ remuneration report continued
INDIVIDUAL REMUNERATION PACKAGES FOR THE YEAR ENDED 31 DECEMBER 2004
Salary Fees 2004 2003
£000 £000 £000 £000
Executive directors
M A Reid 82 – 82 80
T D Bell 165 – 165 86
G S Corsi 68 – 68 65
Dr J F Burke 73 – 73 71
Non-executive directors
J C Morgan –20 20 20
Dr J F Hill –25 25 25
P S Jensen –25 25 25
Aggregate remuneration 388 70 458 372
Notes:
1 The annual review of each executive director’s salary takes place on 31 March in accordance with their individual service contracts. 
2 Directors’ fees payable to non-executive directors are reviewed by the Board in each case on the anniversary of a director’s appointment.
By order of the Board
S C Hedger
Secretary
1 March 2005 We have audited the ﬁnancial statements of Genetix Group
plc for the year ended 31 December 2004 which comprise
the consolidated proﬁt and loss account, the consolidated
and Company balance sheets, the consolidated cash ﬂow
statement, the consolidated statement of total recognised
gains and losses and the related notes 1 to 23, together
with the reconciliation of movements in consolidated
shareholders’ funds. These ﬁnancial statements have been
prepared under the accounting policies set out therein.
We have also audited the information in the part of the
directors’ remuneration report that is described as having
been audited.
This report is made solely to the Company’s members, as a
body, in accordance with section 235 of the Companies
Act 1985. Our audit work has been undertaken so that we
might state to the Company’s members those matters we
are required to state to them in an auditors’ report and for
no other purpose. To the fullest extent permitted by law,
we do not accept or assume responsibility to anyone other
than the Company and the Company’s members as a body,
for our audit work, for this report, or for the opinions we
have formed.
RESPECTIVE RESPONSIBILITIES OF DIRECTORS AND AUDITORS
As described in the statement of directors’ responsibilities,
the Company’s directors are responsible for the preparation
of the ﬁnancial statements in accordance with applicable
United Kingdom law and accounting standards. They are
also responsible for the preparation of the other
information contained in the annual report including 
the directors’ remuneration report. Our responsibility is
to audit the ﬁnancial statements and the part of the
directors’ remuneration report described as having been
audited in accordance with relevant United Kingdom legal
and regulatory requirements, auditing standards, and the
Listing Rules of the Financial Services Authority.
We report to you our opinion as to whether the ﬁnancial
statements give a true and fair view and whether the
ﬁnancial statements and the part of the directors’
remuneration report described as having been audited
have been properly prepared in accordance with the
Companies Act 1985. We also report if, in our opinion,
the directors’ report is not consistent with the ﬁnancial
statements, if the Company has not kept proper accounting
records, if we have not received all the information and
explanations we require for our audit, or if information
speciﬁed by law or the Listing Rules regarding directors’
remuneration and transactions with the Company and
other members of the Group is not disclosed.
We review whether the corporate governance statement
reﬂects the Company’s compliance with the nine
provisions of the July 2003 FRC Combined Code speciﬁed
for our review by the Listing Rules of the Financial Services
Authority, and we report if it does not. We are not required
to consider whether the Board’s statements on internal
control cover all risks and controls, or form an opinion
on the effectiveness of the Group’s corporate governance
procedures or its risk and control procedures.
We read the directors’ report and the other information
contained in the annual report for the above year as
described in the contents section including the unaudited
part of the directors’ remuneration report and consider
the implications for our report if we become aware of any
apparent misstatements or material inconsistencies with
the ﬁnancial statements.
BASIS OF AUDIT OPINION
We conducted our audit in accordance with United
Kingdom auditing standards issued by the Auditing
Practices Board. An audit includes examination, on a test
basis, of evidence relevant to the amounts and disclosures
in the ﬁnancial statements and the part of the directors’
remuneration report described as having been audited.
It also includes an assessment of the signiﬁcant estimates
and judgements made by the directors in the preparation
of the ﬁnancial statements and of whether the accounting
policies are appropriate to the circumstances of the
Company and the Group, consistently applied and
adequately disclosed.
We planned and performed our audit so as to obtain all
the information and explanations which we considered
necessary in order to provide us with sufﬁcient evidence
to give reasonable assurance that the ﬁnancial statements
and the part of the directors’ remuneration report
described as having been audited are free from material
misstatement, whether caused by fraud or other
irregularity or error. In forming our opinion, we also
evaluated the overall adequacy of the presentation of
information in the ﬁnancial statements and the part
of the directors’ remuneration report described as
having been audited.
OPINION
In our opinion:
• The ﬁnancial statements give a true and fair view of
the state of affairs of the Company and the Group as
at 31 December 2004 and of the proﬁt of the Group
for the year then ended; and
• The ﬁnancial statements and part of the directors’
remuneration report described as having been audited
have been properly prepared in accordance with the
Companies Act 1985.
Deloitte & Touche LLP
Chartered accountants and registered auditors
Southampton
1 March 2005
An audit does not provide assurance on the maintenance
and integrity of the website, including controls used to
achieve this, and in particular on whether any changes
may have occurred to the ﬁnancial statements since ﬁrst
published. These matters are the responsibility of the
directors but no control procedures can provide absolute
assurance in this area. Legislation in the United Kingdom
governing the preparation and dissemination of ﬁnancial
statements differs from legislation in other jurisdictions.
22 GENETIX GROUP PLC
Independent auditors’ report
to the members of Genetix Group plc ANNUAL REPORT & ACCOUNTS 2004 23
Consolidated proﬁt and loss account
for the year ended 31 December 2004
Before Total Total
goodwill Goodwill 2004 2003
Note £000 £000 £000 £000
Turnover – continuing operations 2 12,217 – 12,217 10,849
Cost of sales (6,346) – (6,346) (5,720)
Gross proﬁt 5,871 – 5,871 5,129
Research & development (1,075) – (1,075) (1,191)
Sales & administrative expenses (4,492) – (4,492) (3,915)
Amortisation of goodwill – (362) (362) (361)
Total administrative expenses (5,567) (362) (5,929) (5,467)
Operating proﬁt/(loss) – continuing operations 3 304 (362) (58) (338)
Interest receivable 6 913 – 913 759
Proﬁt on ordinary activities before taxation 1,217 (362) 855 421
Tax on proﬁt on ordinary activities 7 (58) – (58) (67)
Proﬁt for the ﬁnancial year 18 1,159 (362) 797 354
Basic earnings per share 9 1.62p (0.51p) 1.11p 0.49p
Diluted earnings per share 9 1.62p (0.51p) 1.11p 0.46p 24 GENETIX GROUP PLC
Consolidated and company balance sheets
at 31 December 2004
Group Group Company Company
2004 2003 2004 2003
Note £000 £000 £000 £000
Fixed assets
Intangible assets 10 5,989 6,420 – –
Tangible assets 11 2,240 2,181 – –
Investments 12 2 2 37,232 37,232
8,231 8,603 37,232 37,232
Current assets
Stocks 13 1,677 1,679 – –
Debtors 14 2,557 1,974 17 23
Cash at bank and in hand 22,153 22,094 20,228 20,052
26,387 25,747 20,245 20,075
Creditors: amounts falling due within one year 15 (2,548) (3,094) (779) (633)
Net current assets 23,839 22,653 19,466 19,442
Total assets less current liabilities 32,070 31,256 56,698 56,674
Provisions for liabilities and charges 16 (471) (431) – –
Net assets 31,599 30,825 56,698 56,674
Capital and reserves
Share capital 17 35,849 35,849 35,849 35,849
Share premium account 18 16,376 16,376 16,376 16,376
Capital redemption reserve 18 2,925 2,925 2,925 2,925
Merger reserve 18 (29,686) (29,686) – –
Proﬁt and loss account 18 6,135 5,361 1,548 1,524
Equity shareholders’ funds 31,599 30,825 56,698 56,674
Approved by the Board on 1 March 2005
M A Reid G S Corsi
Director Director ANNUAL REPORT & ACCOUNTS 2004 25
Consolidated cash ﬂow statement
for the year ended 31 December 2004
2004 2003
Note £000 £000
Net cash (outﬂow)/inﬂow from operating activities 19a (394) 1,083
Returns on investments and servicing of ﬁnance
Interest received 913 759
913 759
Taxation
Corporation tax refund 95 16
Corporation tax paid (157) (365)
(62) (349)
Capital expenditure and ﬁnancial investment
Purchase of tangible ﬁxed assets (345) (136)
Purchase of intangible ﬁxed assets (57) (70)
Sale of tangible ﬁxed assets 27 7
(375) (199)
Net cash inﬂow before use of liquid resources and ﬁnancing 82 1,294
Financing
Share capital re-purchased (including expenses) – (241)
Net cash outﬂow from ﬁnancing – (241)
Increase in cash 19b,c 82 1,053 26 GENETIX GROUP PLC
Consolidated statement of total recognised gains and losses 
for the year ended 31 December 2004
2004 2003
£000 £000
Proﬁt for the ﬁnancial year 797 354
Currency translation differences on foreign currency net investments (23) (33)
Total recognised gains and losses for the year 774 321
Reconciliation of movements in consolidated
shareholders’ funds
for the year ended 31 December 2004
2004 2003
£000 £000
Proﬁt for the ﬁnancial year 797 354
Currency translation differences (23) (33)
Share capital re-purchased (including fees) – (241)
Net movement in shareholders’ funds 774 80
Opening shareholders’ funds 30,825 30,745
Closing shareholders’ funds 31,599 30,825 1 PRINCIPAL ACCOUNTING POLICIES
The 2004 ﬁnancial statements have been prepared under the historical cost convention in accordance with applicable
United Kingdom accounting standards.
Basis of consolidation 
The consolidated ﬁnancial statements include the accounts of the Company and all its subsidiaries.
Acquisitions
On the acquisition of a business, fair values are attributed to the Group’s share of the separable net assets. Where the
cost of acquisition exceeds the fair values attributable to such assets, the difference is treated as purchased goodwill.
The results and cashﬂows relating to the acquired business are included in the consolidated proﬁt and loss account
and the consolidated cashﬂow statement from the date of acquisition.
Business combinations meeting the requirements of FRS 6 “Mergers and Acquisitions” and the Companies Act 1985 are
treated as mergers within the consolidated accounts. 
Intangible assets – goodwill
For acquisitions of a business following the implementation of FRS 10 “Goodwill and Intangible Assets”, purchased
goodwill is capitalised in the year in which it arises and amortised over its estimated useful life of 20 years. The directors
regard 20 years as a reasonable estimate for the useful life of goodwill since it is difﬁcult to make projections exceeding
this period.
Intangible assets – patents and licences
Patents and licences are valued at cost on acquisition and are depreciated in equal annual instalments over their estimated
useful lives of four to ten years.
Tangible ﬁxed assets
Depreciation is provided in equal annual instalments in order to write off the cost of each asset over its estimated useful life
at the following rates:
Freehold property 2% per annum
Plant and machinery 25-50% per annum
Motor vehicles 25% per annum
Ofﬁce ﬁxtures and ﬁttings 25% per annum
Freehold land is not depreciated.
Investments
Investments held as ﬁxed assets are stated at cost less provision for any impairment in value.
Stocks
Stocks and work-in-progress are stated at the lower of cost and net realisable value, after making allowance for obsolete
and slow moving items.
Taxation
Current tax, including UK corporation tax and foreign tax, is provided at amounts expected to be paid (or recovered) using
the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.
Deferred taxation is provided in full on timing differences that result in an obligation at the balance sheet date to pay more
tax, or a right to pay less tax, at a future date, at rates expected to apply when they crystallise based on current tax rates and
law. Timing differences arise from the inclusion of items of income and expenditure in taxation computations in periods
different from those in which they are included in ﬁnancial statements. Deferred tax assets and liabilities are not discounted.
ANNUAL REPORT & ACCOUNTS 2004 27
Notes to the accounts
for the year ended 31 December 2004 28 GENETIX GROUP PLC
Notes to the accounts continued
for the year ended 31 December 2004
1 PRINCIPAL ACCOUNTING POLICIES CONTINUED
Turnover
Turnover represents the sales value of goods and services to external customers falling within the Group’s ordinary
activities. Sales of individual instruments are accounted for as long-term contracts being recognised when the ﬁnal
outcome can be assessed with reasonable certainty. Proﬁt is recognised on long-term contracts if the ﬁnal outcome can be
assessed with reasonable certainty, by including in the proﬁt and loss account turnover and related costs as contract activity
progresses. Turnover is calculated by reference to the value of work performed to date as a proportion of total contract value.
Sales of consumables are recognised on delivery of product, and service contracts evenly over the contractual period.
Turnover is stated net of trade discount and sales related taxes.
Turnover and operating result are attributable to the principal activity of the Company and Group. 
Pension costs
The Group administers a stakeholder pension scheme for its UK employees and contributes to a 401K insurance scheme for
its US employees.
Foreign currency
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet
date. Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Adjustments resulting
from exchange ﬂuctuations have been reﬂected in the proﬁt and loss account.
The ﬁnancial statements of foreign subsidiaries are translated into sterling at the closing rates of exchange for each period.
The proﬁt and loss accounts of foreign subsidiaries are translated into sterling at the average rate of exchange for each
period. The differences arising on translation are taken directly to reserves.
The Group uses derivative ﬁnancial instruments solely to reduce exposure to foreign exchange risk.
Government grants
Government grants relating to tangible ﬁxed assets are treated as deferred income and released to the proﬁt and loss
account over the expected useful lives of the assets concerned. Other grants are credited to the proﬁt and loss account as
the related expenditure is incurred.
Research and development
Research and development expenditure is charged to the proﬁt and loss account as incurred.
Product warranties
Provision is made for the anticipated cost of expected claims against product warranties on products sold.  ANNUAL REPORT & ACCOUNTS 2004 29
Notes to the accounts continued
for the year ended 31 December 2004
2 TURNOVER
In the opinion of the directors, the Group operates only one class of business, namely the provision of instrumentation,
consumables and services for cell biology, proteomic and genomic research. Turnover can be analysed as follows:
2004 2003
£000 £000
By geographic destination
UK 1,752 1,444
Rest of Europe 2,673 2,620
North America 6,668 5,543
Rest of World 1,124 1,242
12,217 10,849
The majority of turnover was generated in the United Kingdom with the exception of Genetix USA Inc., segmental disclosure
of which would be prejudicial to the business in the United States.
2004 2003
£000 £000
By type
Instrumentation 9,245 7,380
Consumables and services 2,972 3,469
12,217 10,849
3 OPERATING LOSS
2004 2003
£000 £000
Operating loss is stated after charging/(crediting):
Depreciation of owned assets 260 279
Amortisation of goodwill 362 361
Amortisation of patents and licences 126 115
Proﬁt on sale of ﬁxed assets (4) (7)
Auditors’ remuneration:
Audit services
Statutory audit 27 29
Audit-related regulatory reporting 11 10
Tax services
Compliance services 9 9
Advisory services 22 27
Research and development (including salaries) 1,500 1,416
Grant recoveries (425) (225)
Exchange gain on foreign currency transactions (140) (174)
Auditors’ remuneration paid by the Company in respect of services as auditors was £21,000 (2003: £19,000). 30 GENETIX GROUP PLC
Notes to the accounts continued
for the year ended 31 December 2004
4 EMPLOYEE COSTS AND NUMBERS
Group Group
2004 2003
£000 £000
Costs (including directors)
Wages and salaries 3,984 3,349
Social security costs 422 349
Pension costs 17 41
4,423 3,739
2004 2003
No. No.
Average number employed
Sales and marketing 30 27
Research and development 23 24
Production and technical support 33 27
Administration 16 16
Laboratory 6 6
108 100
5 DIRECTORS’ REMUNERATION
The tables relating to directors’ remuneration and share options are included in the audited part of the directors’
remuneration report on pages 20 and 21.
6 INTEREST RECEIVABLE
2004 2003
£000 £000
Interest receivable 913 759 7TAX ON PROFIT ON ORDINARY ACTIVITIES
2004 2003
£000 £000
Current tax
UK corporation tax 202 90
Adjustments in respect of prior years (175) (57)
27 33
Foreign tax 19 18
Total current tax 46 51
Deferred tax
Origination and reversal of timing differences (note 16) 12 4
Adjustments in respect of prior years – 12
Total deferred tax 12 16
Total tax on proﬁt on ordinary activities 58 67
The tax assessed for the year is lower than that resulting from applying the standard rate of corporation tax in the UK of 30%
(2003: 30%). The differences are explained below:
2004 2003
% %
Standard tax rate for year as a percentage of proﬁts 30 30
Effects of:
Expenses not deductible for tax purposes 13 27
Capital allowances in excess of depreciation (3) (1)
Movement in short term timing differences 1 –
Other – (2)
Research and development tax credits (16) (28)
Prior period adjustments (20) (14)
Current tax rate for year as a percentage of proﬁts 5 12
8PROFIT FOR YEAR ATTRIBUTABLE TO GENETIX GROUP PLC
As permitted by section 230 of the Companies Act 1985, the proﬁt and loss of the parent Company is not individually
presented as part of these accounts. The parent Company’s proﬁt for the year ended 31 December 2004 was £24,000
(2003: £1,460,000).
ANNUAL REPORT & ACCOUNTS 2004 31
Notes to the accounts continued
for the year ended 31 December 2004 9 EARNINGS PER SHARE
2004 2003
£000 £000
Proﬁt for the ﬁnancial year before amortisation of goodwill 1,159 715
Amortisation of goodwill (362) (361)
Proﬁt for the ﬁnancial year 797 354
No. 000 No. 000
Basic weighted average number of shares 71,699 72,077
Dilutive effect of share options 31 5,272
Diluted weighted average number of shares 71,730 77,349
Pence Pence
Basic earnings per share before amortisation of goodwill 1.62 0.99
Diluted earnings per share before amortisation of goodwill 1.62 0.93
Basic earnings per share 1.11 0.49
Diluted earnings per share 1.11 0.46
Earnings are calculated as proﬁt after taxation for the year. Earnings per share before amortisation of goodwill has been
shown because the directors consider that this gives a useful indication of underlying performance.
10 INTANGIBLE FIXED ASSETS
Patents
Goodwill & licences Total
Group £000 £000 £000
Cost
At 1 January 2004 7,231 559 7,790
Additions –57 57
At 31 December 2004 7,231 616 7,847
Amortisation
At 1 January 2004 1,174 196 1,370
Charge for the year 362 126 488
At 31 December 2004 1,536 322 1,858
Net book value
At 31 December 2004 5,695 294 5,989
At 31 December 2003 6,057 363 6,420
32 GENETIX GROUP PLC
Notes to the accounts continued
for the year ended 31 December 2004 ANNUAL REPORT & ACCOUNTS 2004 33
Notes to the accounts continued
for the year ended 31 December 2004
11 TANGIBLE FIXED ASSETS
Freehold Ofﬁce 
land & Plant & Motor ﬁxtures &
buildings machinery vehicles ﬁttings Total
Group £000 £000 £000 £000 £000
Cost
At 1 January 2004 2,025 788 82 261 3,156
Additions – 306 – 39 345
Disposals – (8) (47) – (55)
Exchange adjustment – – – (5) (5)
At 31 December 2004 2,025 1,086 35 295 3,441
Depreciation
At 1 January 2004 141 587 46 201 975
Charge for the year 40 165 11 44 260
Disposals – (4) (28) – (32)
Exchange adjustment – – – (2) (2)
At 31 December 2004 181 748 29 243 1,201
Net book value
At 31 December 2004 1,844 338 6 52 2,240
At 31 December 2003 1,884 201 36 60 2,181
12 INVESTMENTS
Group Group Company Company
2004 2003 2004 2003
£000 £000 £000 £000
Cost and net book value
Listed investments 2 2 – –
Investment in subsidiary undertakings – – 37,232 37,232
At 31 December 2004 and 2003 2 2 37,232 37,232
Details of the subsidiary companies are as follows:
Percentage of
Subsidiary undertaking Country of incorporation Principal activity equity shares held
Genetix Limited United Kingdom Manufacture and sale of robotics and consumable products 100%
Genescreen Limited United Kingdom Provision of biological services 100%
Genpak Limited United Kingdom Dormant 100%
Genetix USA Inc. USA Manufacture and sale of reagents; marketing company for
Genetix Limited products for North America 100%
Genetix GmbH Germany Marketing company for Germany, Austria and Switzerland 100% 13 STOCKS
Group Group
2004 2003
£000 £000
Raw materials 907 978
Work in progress 42 93
Finished goods 728 608
1,677 1,679
14 DEBTORS
Group Group Company Company
2004 2003 2004 2003
£000 £000 £000 £000
Trade debtors 2,251 1,641 – –
Other debtors 186 216 – –
Prepayments 120 117 17 23
2,557 1,974 17 23
15 CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Group Group Company Company
2004 2003 2004 2003
£000 £000 £000 £000
Trade creditors 861 1,116 – –
Amounts owed to subsidiary undertakings (note 21) – – 679 478
Taxation and social security 105 101 – –
Other creditors 183 476 – –
Corporation tax 452 469 54 34
Accruals and deferred income 947 932 46 121
2,548 3,094 779 633
34 GENETIX GROUP PLC
Notes to the accounts continued
for the year ended 31 December 2004 16 PROVISIONS FOR LIABILITIES AND CHARGES
Product Deferred Group
warranties taxation 2004
£000 £000 £000
At 1 January 2004 124 307 431
Utilised during year (81) – (81)
Proﬁt and loss charge 109 12 121
At 31 December 2004 152 319 471
Product warranties
Aprovision has been recognised for expected claims against product warranties on products sold during the year. It is
expected that most of this expenditure will be incurred in the next ﬁnancial year. 
Deferred taxation 
Deferred taxation has been provided in the ﬁnancial statements as follows:
Group Group Company Company
2004 2003 2004 2003
£000 £000 £000 £000
Accelerated capital allowances 364 340 – –
Other timing differences (45) (33) – –
319 307 – –
17 SHARE CAPITAL
2004 2003
£000 £000
Authorised share capital:
130,000,000 ordinary shares of 50p each 65,000 65,000
Issued share capital:
71,698,688 (2003: 71,698,688) ordinary shares of 50p each 35,849 35,849
ANNUAL REPORT & ACCOUNTS 2004 35
Notes to the accounts continued
for the year ended 31 December 2004 36 GENETIX GROUP PLC
Notes to the accounts continued
for the year ended 31 December 2004
17 SHARE CAPITAL CONTINUED
Under the Company’s Executive Approved and Unapproved 2000 Share Option Schemes, directors and employees held
options at 31 December 2004 for 5,272,420 (2003: 5,177,695) unissued ordinary shares as follows:
At 1 Jan At 31 Dec Exercise
Scheme 2004 Granted Exercised Lapsed 2004 price Normal exercise period
Approved 403,998 – – (25,333) 378,665 150p 24 Nov 2003 – 23 Nov 2010
Approved 55,363 – – – 55,363 158.5p 1 Aug 2004 – 31 Jul 2011
Approved 36,585 – – (36,585) – 82p 26 Oct 2004 – 25 Oct 2011
Approved 260,601 – – (21,805) 238,796 66.5p 5 Mar 2005 – 4 Mar 2012
Approved 108,434 – – – 108,434 50p 30 Jul 2005 – 29 Jul 2012
Approved 165,600 – – (40,000) 125,600 50p 5 Mar 2006 – 4 Mar 2013
Approved 10,000 – – – 10,000 50p 30 Jul 2006 – 29 Jul 2013
Approved 58,252 – – – 58,252 51.5p 15 Sep 2006 – 14 Sep 2013
Approved – 251,710 – (11,966) 239,744 58.5p 3 Mar 2007 – 2 Mar 2014
Approved – 23,000 – – 23,000 51.5p 28 Jul 2007 – 27 Jul 2014
Unapproved 593,336 – – – 593,336 150p 24 Nov 2003 – 23 Nov 2010
Unapproved 19,716 – – – 19,716 158.5p 1 Aug 2004 – 31 Jul 2011
Unapproved 85,366 – –(85,366) – 82p 26 Oct 2004 – 25 Oct 2011
Unapproved 1,056,949 – – (62,175) 994,774 66.5p 5 Mar 2005 – 4 Mar 2012
Unapproved 60,000 – –(60,000) – 50p 30 Jul 2005 – 29 Jul 2012
Unapproved 90,000 – –(90,000) – 50p 9 Sep 2005 – 8 Sep 2012
Unapproved 125,000 – – – 125,000 50p 5 Mar 2006 – 4 Mar 2013
Unapproved 165,000 – – (20,000) 145,000 50p 30 Jul 2006 – 29 Jul 2013
Unapproved 640,777 – – – 640,777 51.5p 15 Sep 2006 – 14 Sep 2013
Unapproved
1
1,242,718 – – – 1,242,718 51.5p 15 Sep 2008 – 14 Sep 2013
Unapproved – 265,846 – (37,607) 228,239 58.5p 3 Mar 2007 – 2 Mar 2014
Unapproved – 45,006 – – 45,006 51.5p 28 Jul 2007 – 27 Jul 2014
5,177,695 585,562 – (490,837) 5,272,420
Note:
1Super Options granted to Trevor Bell, Chief Operating Ofﬁcer, subject to more stringent performance criteria (see Remuneration Report page 19).
Under the Company’s Approved Sharesave Scheme, directors and employees held options at 31 December 2004 for 408,554
(2003: 340,215) unissued ordinary shares as follows:
At 1 Jan At 31 Dec Exercise
Scheme 2004 Granted Exercised Lapsed 2004 price Normal exercise period
Sharesave 11,300 – – (11,300) – 120p 1 Feb 2004 – 1 Aug 2004
Sharesave 1,125 – – (1,125) – 120p 1 Feb 2006 – 1 Aug 2006
Sharesave 265,922 – – (75,572) 190,350 53.5p 1 Jun 2005 – 1 Dec 2005
Sharesave 61,868 – – (30,934) 30,934 53.5p 1 Jun 2007 – 1 Dec 2007
Sharesave – 179,452 – (24,882) 154,570 50.0p 1 Jun 2007 – 1 Dec 2007
Sharesave – 32,700 – – 32,700 50.0p 1 Jun 2009 – 1 Dec 2009
340,215 212,152 – (143,813) 408,554 ANNUAL REPORT & ACCOUNTS 2004 37
Notes to the accounts continued
for the year ended 31 December 2004
17 SHARE CAPITAL CONTINUED
Under other option agreements, certain directors and employees held options at 31 December 2004 for 967,047
(2003: 967,047) unissued ordinary shares as follows:
At 1 Jan At 31 Dec Exercise
Date of grant 2004 Granted Exercised Lapsed 2004 price Normal exercise period
4 Oct 2000 886,524 – – – 886,524 67.68p 29 Nov 2000 – 3 Oct 2010
11 Nov 2000 66,667 – – – 66,667 150p 11 Nov 2003 – 10 Nov 2010
8 Mar 2001 13,856 – – – 13,856 216.5p 4 Feb 2002 – 7 Mar 2011
967,047 – – – 967,047
The share price at 31 December 2004 was 46.5p. The range during the year was 44.0p–58.5p.
18 RESERVES
Share Capital Proﬁt
premium redemption Merger & loss
account reserve reserve account Total
Group £000 £000 £000 £000 £000
At 1 January 2004 16,376 2,925 (29,686) 5,361 (5,024)
Retained proﬁt for the ﬁnancial year – – – 797 797
Currency translation differences – – – (23) (23)
At 31 December 2004 16,376 2,925 (29,686) 6,135 (4,250)
Share Capital Proﬁt
premium redemption Merger & loss
account reserve reserve account Total
Company £000 £000 £000 £000 £000
At 1 January 2004 16,376 2,925 – 1,524 20,825
Retained proﬁt for the ﬁnancial year – – – 24 24
At 31 December 2004 16,376 2,925 – 1,548 20,849 38 GENETIX GROUP PLC
Notes to the accounts continued
for the year ended 31 December 2004
19 NOTES TO THE CASH FLOW STATEMENT
(a)Reconciliation of operating loss to net cash (outﬂow)/inﬂow from operating activities
Group Group
2004 2003
£000 £000
Operating loss (58) (338)
Depreciation 260 279
Amortisation 488 476
Proﬁt on sale of ﬁxed assets (4) (7)
Decrease/(increase) in stocks 2 (157)
(Increase)/decrease in debtors (583) 281
(Decrease)/increase in creditors (522) 723
Exchange loss/(gain) on foreign currency transactions 23 (174)
Net cash (outﬂow)/inﬂow from operating activities (394) 1,083
(b) Analysis of changes in net funds
At 1 Jan Cash Exchange At 31 Dec
2004 ﬂow movement 2004
£000 £000 £000 £000
Cash at bank and in hand 22,094 82 (23) 22,153
22,094 82 (23) 22,153
(c) Reconciliation of net cash ﬂowto movement in net funds
Group Group
2004 2003
£000 £000
Increase in cash in the year 82 1,053
Change in net funds resulting from cash ﬂows 82 1,053
Translation difference (23) 174
Movement in net funds in the year 59 1,227
Net funds at 1 January 2004 22,094 20,867
Net funds at 31 December 2004 22,153 22,094
20 CAPITAL COMMITMENTS
There were no capital commitments as at 31 December 2004 or 31 December 2003.
21 RELATED PARTY TRANSACTIONS
In accordance with the exemptions from disclosure under Financial Reporting Standard 8, transactions and balances with
Group companies are not disclosed. There were no other related party transactions during the year. ANNUAL REPORT & ACCOUNTS 2004 39
Notes to the accounts continued
for the year ended 31 December 2004
22 DERIVATIVES AND OTHER FINANCIAL INSTRUMENTS
The Group’s ﬁnancial instruments comprise cash, forward foreign exchange contracts and various non-derivative ﬁnancial
instruments such as trade debtors and trade creditors. As permitted by Financial Reporting Standard 13 “Derivatives and
other ﬁnancial instruments: Disclosures” (“FRS 13”), short-term debtors and creditors have been excluded from FRS 13
disclosures, other than currency disclosures.
The main risks arising from ﬁnancial instruments of the Group are interest risk, foreign exchange risk and liquidity risk. 
The Group’s policies in respect of the management of these risks are as follows:
Interest risk: The Group ﬁnances its operations through a mixture of retained earnings, cash balances and receipts from
share issues. The majority of the Group’s cash is invested with the Bank of Scotland currently earning interest at UK Base
Rate plus 0.1%.
Foreign exchange risk: The Group does not engage in speculative transactions and its policy is to minimise its exposure to
exchange rate ﬂuctuations by using forward contracts. Exchange exposure is reviewed on at least a quarterly basis and cover
taken based on expected net cash ﬂows within the next 12 months. The Group translates overseas proﬁts and net assets in
accordance with the accounting policy in note 1. Translation differences are dealt with through the Group’s statement of
total recognised gains and losses. At 31 December 2004, the Group was committed to forward exchange contracts totalling
US $4,000,000 at an average rate of £/$ 1.7574 and € 1,200,000 at an average rate of £/€ 1.4030, all maturing before
31 December 2005, with an unrecognised gain of £198,427 (2003: £207,789 gain, recognised in 2004). This is not
materially different from the fair value of the contracts.
Liquidity risk: None
The interest rate risk proﬁle of the Group’s ﬁnancial assets and liabilities is as follows:
Total Total
Sterling US $ Euro 2004 Sterling US $ Euro 2003
Financial assets £000 £000 £000 £000 £000 £000 £000 £000
Floating rate 21,333 150 5 21,488 20,616 173 20 20,809
Non-interest bearing 10 403 252 665 73 1,081 131 1,285
21,343 553 257 22,153 20,689 1,254 151 22,094
Disclosed as:
Cash at bank and in hand 22,153 22,094
Weighted average interest rate 4.31% 0.45% 0.21% 4.16% 3.75% 0.22% 0.06% 3.40%
There were no ﬁnancial liabilities as at 31 December 2004 or 31 December 2003. 40 GENETIX GROUP PLC
Notes to the accounts continued
for the year ended 31 December 2004
22 DERIVATIVES AND OTHER FINANCIAL INSTRUMENTS CONTINUED
The main functional currencies of the Group are sterling, the US dollar and the euro. Currency exposures comprise the cash
and debtor balances of the Group that are not denominated in the functional currency of the operating unit involved, after
the effects of forward contracts. As at 31 December 2004, these exposures were as follows:
Total Total
Sterling US $ Euro 2004 Sterling US $ Euro 2003
Currency proﬁle £000 £000 £000 £000 £000 £000 £000 £000
Functional currencies:
Sterling – – – – ––––
US $ ––– – ––––
Euro ––– – ––––
–––– ––––
In the opinion of the Board, the fair value of the Group’s ﬁnancial assets is equal to the book value. Interest on ﬂoating rate
assets and liabilities is based upon the relevant national inter bank rates.
23 ULTIMATE CONTROLLING PARTY
M A Reid, Director and Chief Executive, is the ultimate controlling party of the Company. ANNUAL REPORT & ACCOUNTS 2004 41
Notice of Annual General Meeting
Notice is hereby given that the ﬁfth Annual General Meeting of the Company will be held at the ofﬁces of Financial
Dynamics, Holborn Gate, 26 Southampton Buildings, London, WC2A 1PB at 11.30am on Wednesday 27 April 2005 for
the transaction of the following business:
ORDINARY BUSINESS
1To receive and adopt the accounts, the directors’ report, and the auditors’ report for the year ended 31 December 2004.
2To approve the directors’ remuneration report for the year ended 31 December 2004.
3To re-appoint Mr G S Corsi as a director of the Company, retiring in accordance with the Company’s Articles of Association.
4To re-appoint Mr J C Morgan as a director of the Company, retiring in accordance with the Company’s Articles
of Association.
5To re-appoint Deloitte & Touche LLP as auditors and authorise the directors to determine their remuneration.
SPECIAL BUSINESS
To consider and, if thought ﬁt, pass resolution 6 as an ordinary resolution and resolutions 7 and 8 as special resolutions. 
6Thatthe Board be and it is hereby generally and unconditionally authorised to exercise all powers of the Company to
allot relevant securities (within the meaning of Section 80 of the Companies Act 1985) up to an aggregate nominal
amount of £15,273,791 provided that this authority is in substitution for any existing authorities conferred on the
directors pursuant to section 80 of the said Act and (unless previously revoked or varied by the Company in general
meeting) shall expire at the conclusion of the next Annual General Meeting of the Company save that the Company
may before such expiry make an offer or agreement which would or might require relevant securities to be allotted
after such expiry and the Board may allot relevant securities in pursuance of such an offer or agreement as if the
authority conferred hereby had not expired.
7Thatsubject to the passing of the previous resolution the Board be and it is hereby empowered pursuantto Section 95
of the Companies Act 1985 to allot equity securities (within the meaning of Section 94 of the said Act) for cash either
pursuant to the authority conferred by the previous resolution or by an allotment of equity securities such as is referred
to in section 94(3A) of the Act, as if sub-section (1) of Section 89 of the said Act did not apply to any such allotment
provided that this power shall be in addition to any existing powers conferred on the directors pursuant to section 95 of
the said Act and shall be limited to:
(i) the allotment of equity securities in connection with a rights issue or open offer or otherwise in favour of ordinary
shareholders where the equity securities respectively attributable to the interests of all ordinary shareholders are
proportionate (as nearly as may be) to the respective numbers of ordinary shares held by them subject to such
exclusions as the directors may deem ﬁt to deal with fractional entitlements or with legal or practical problems
arising in any overseas territory or with the requirements of any regulatory body or stock exchange; and
(ii) the allotment (otherwise than pursuant to sub-paragraph 7(i) above) of equity securities up to an aggregate
nominal value of £1,792,467
and shall expire at the conclusion of the next Annual General Meeting of the Company after the passing of this
resolution save that the Company may before such expiry make an offer or agreement which would or might require
equity securities to be allotted after such expiry and the Board may allot equity securities in pursuance of such an offer
or agreement as if the power conferred hereby had not expired. 42 GENETIX GROUP PLC
Notice of Annual General Meeting continued
8Thatthe Company be and is hereby unconditionally and generally authorised in accordance with section 166 of the
Companies Act 1985 (the “Act”) to make market purchases (as deﬁned in Section 163 of the Act) of a maximum of
2,000,000 ordinary shares of 50p each in the capital of the Company on such terms and in such manner as the directors
may, from time to time, determine provided that:
i) the minimum price which may be paid for each share is 1p;
ii) the maximum price which may be paid for each share is an amount equal to 105% of the average of the middle
market quotations for an ordinary share of the Company as derived from the London Stock Exchange Daily Ofﬁcial List
for the ﬁve business days immediately preceding the day on which such share is contracted to be purchased; and
iii) this authority shall expire at the conclusion of the next Annual General Meeting of the Company or if earlier on
30 September 2006 unless such authority is renewed prior to such time, provided that the Company may make a
contract to purchase ordinary shares under the authorityconferred prior to the expiry of such authority which will
or may be executed wholly or partly after the expiry of such authority and may make a purchase of ordinary shares
pursuant to any such contract as if such authority had not expired. 
By order of the Board
S C Hedger
Secretary
21 March 2005
Registered ofﬁce:
Queensway, New Milton, Hampshire, BH25 5NN
Registered in England and Wales
Registered Number 4024856
NOTES TO THE NOTICE OF THE ANNUAL GENERAL MEETING
1A member entitled to attend and vote at the meeting is also entitled to appoint one or more proxies to attend and on a poll, vote
instead of him. The proxy need not be a member of the Company. 
2A form of proxy is enclosed with this notice. To be effective, the instrument appointing a proxy (together with any power of attorney or
other authority under which it is executed or a duly certiﬁed copy of such power) must be sent to the Company’s registrars, Lloyds TSB
Registrars, The Causeway, Goring-by-sea, Worthing, West Sussex, BN99 6ZL, not less than 48 hours before the time for holding the
meeting or adjourned meeting as the case may be. A corporation may execute a proxy under its common seal or by the hand of a duly
authorised ofﬁcer or other agent. Completion and return of the form of proxy will not preclude shareholders from attending and voting
in person at the meeting.
3 In accordance with Regulation 41 of the Uncertiﬁcated Securities Regulations 2001, only those members entered on the register of
members of the Company as at 6.00pm on 25 April 2005 shall be entitled to attend or vote at the meeting in respect of the number of
shares registered in their name at that time. Changes to entries on the register of members after 6.00pm on 25 April 2005 shall be
disregarded in determining the rights of any person to attend or vote at the meeting.
4 The register of directors’ interests kept by the Company under Section 325 of the Companies Act 1985 will be available for reference at
the commencement and remain open until the conclusion of the Annual General Meeting. ANNUAL REPORT & ACCOUNTS 2004 43
EXPLANATORY NOTES
Directors’ remuneration report – resolution 2
The Directors’ Remuneration Report Regulations 2002 (“the Regulations”) came into force on 1 August 2002 and it is a requirement of
the Regulations that all quoted companies produce a board-approved report on directors’ remuneration for ﬁnancial years ending on or
after 31 December 2002. This report is set out on pages 17 to 21 of the annual report and accounts. It is a further requirement of the
Regulations that at the general meeting of the company before which the company’s annual accounts for the ﬁnancial year are laid, an
ordinary resolution be put to shareholders seeking approval for the remuneration report. 
Authority to allot shares – resolution 6
This resolution set out in the notice of the Annual General Meeting will be proposed to give the directors a new and unconditional
authority, for the purposes of Section 80 of the Act, to allot relevant securities up to an aggregate nominal amount of £15,273,791. This
amount is the maximum authorityrecommended by the ABI guidelines and approximates to one-third of the existing issued ordinary
share capital of the Company, together with the relevant securities which may be issued pursuant to outstanding options. There is no
present intention of exercising this authority.
Disapplication of pre-emption rights – resolution 7
Section 89 of the Act grants existing members pre-emption rights i.e. it provides that on the allotment of new shares for cash they must
ﬁrst be offered to existing members in proportion to the number of shares already held by such members. The directors believe that it is in
the best interests of the Company that the Board should have limited power to allot part of the Company’s authorised but unissued equity
share capital, or to transfer shares out of treasury for cash, without ﬁrst having to offer such shares to existing shareholders. There is no
present intention of using these powers. The power if granted will relate to allotments of equity securities having an aggregate nominal
value not exceeding £1,792,467, being approximately 5% of the existing issued ordinary share capital of the Company.
General authority to buy back shares – resolution 8
The directors of Genetix seek authority to purchase up to 2,000,000 ordinary shares (representing approximately 2.8% of the current
issued ordinary share capital of the Company). The maximum price per share which may be paid on any exercise of this authority will not
exceed 105% of the average of the middle market quotations for an ordinary share of the Company for the ﬁve business days immediately
preceding the date on which such share is contracted to be purchased. The minimum price will be 1p per ordinary share. This authority is a
renewal of the authority previously granted on 30 April 2004.
The directors do not intend to exercise the Company’s power to purchase its own shares other than in circumstances where, in the light
of market conditions prevailing at the time, they consider this to be in the shareholders’ best interests and where this would resultin an
increase in earnings per share. In exercising the authority to purchase ordinary shares, the directors may treat the shares that have been
bought back as either cancelled (thereby reducing the number of shares in issue accordingly) or held in treasury (or a combination of both)
and, to the extent that any such shares are held in treasury, earnings per share will only be increased on a temporary basis until such
time as the shares are re-sold out of treasury. In deciding whether or not to exercise this authority, the directors will continue to take
into account other investment opportunities including acquisitions. The Company would use its distributable reserves to effect the
purchase of the ordinary shares. The authority, if granted, will expire on the earlier of the conclusion of the next Annual General
Meeting or 30 September 2006.
On 18 March 2005, being the latest practicable date prior to the publication of this document, there were options outstanding over
6,852,911 ordinary shares, such options having been granted under the rules of the Genetix Executive and Sharesave Option Schemes
or otherwise. In total these represent approximately 9.6% of the Company’s issued share capital as at 18 March 2005 and would represent
approximately 9.8% of the adjusted issued share capital if the full proposed authority to buy back shares is used (and assuming that all
such shares bought back by the Company are cancelled rather than held in treasury).
Notice of Annual General Meeting continued 44 GENETIX GROUP PLC
Five year summary
2004 2003 2002 2001 2000
£000 £000 £000 £000 £000
Proﬁt & loss
Turnover 12,217 10,849 12,572 12,419 10,730
Operating proﬁt* 304 23 1,513 1,605 3,502
Exceptional items – ––– (676)
Goodwill (362) (361) (362) (362) (88)
Net interest receivable 913 759 799 990 132
Proﬁt before tax 855 421 1,950 2,233 2,870
Taxation (58) (67) (585) (752) (967)
Proﬁt for ﬁnancial year 797 354 1,365 1,481 1,903
Dividends – ––– (2,150)
Retained proﬁt/(loss) 797 354 1,365 1,481 (247)
Operating margin* 2.5% 0.2% 12.0% 12.9% 32.6%
Adjusted earnings per share* 1.62p 0.99p 2.23p 2.38p 4.17p
Balance sheet
Fixed assets 8,231 8,603 9,156 9,541 10,130
Working capital 2,138 1,028 1,890 1,688 2,072
Net cash 22,153 22,094 20,867 20,142 18,106
Taxation (771) (776) (1,058) (460) (810)
Other (152) (124) (110) (158) (233)
Net assets 31,599 30,825 30,745 30,753 29,265
Cash ﬂow
Cash (outﬂow)/inﬂow from operations (394) 1,083 1,234 2,136 1,636
Net interest 913 759 799 990 132
Tax(paid)/rebate (62) (349) 13 (1,102) (1,139)
Capital expenditure (402) (206) (350) (758) (2,140)
Acquisitions and disposals 27 7– 827 (882)
Equity dividends paid – ––– (2,150)
Cash inﬂow/(outﬂow) before ﬁnancing 82 1,294 1,696 2,093 (4,543)
Issue of shares – –214 19,299 
Re-purchase of shares – (241) (1,366) – –
(Decrease)/increase in debt – –– (1,699) 1,354
Increase in cash 82 1,053 351 398 16,110
* before exceptional items and goodwill Genetix adds value to scientists working
at the cutting edge of Cell Biology,
Proteomics and Genomics through 
its pioneering development of
automated systems.
Our core skill is in the design, development
and manufacture of innovative systems
that meet the needs of our customers.
Our focus is on systems that reduce
the time and cost of introducing new
biopharmaceuticals.
Our products include instruments and
consumables that were used in the Human
Genome Project and are now used in
the genetic analysis of human diseases,
analysing the proteins of pathogenic
organisms and selecting cells for the
production of therapeutic proteins.
Genetix has established a broad and strong
customer base among many of the world’s
leading academic research groups, biotech
companies and pharmaceutical corporations.
01 Highlights
02 Focus on cell biology
04 Chairman’s statement
05 ChiefExecutive’s review
08 Financial review
09 Directors and company secretary
10 Scientific Advisory Board and Advisers
11 Directors’ report
14 Corporate Governance
17 Directors’ remuneration report
22 Independent auditors’ report
23 Consolidated profit and loss account
24 Consolidated and company balance sheets
25 Consolidated cash flow statement
26 Consolidated statement of total recognised
gains and losses
26 Reconciliation of movements in
consolidated shareholders’ funds
27 Notes to the accounts
41 Notice of Annual General Meeting
44 Five year summary www.genetix.com
GENETIX GROUP PLC • QUEENSWAY • NEW MILTON • HAMPSHIRE • BH25 5NN • T: +44 (0)1425 624600 • F: +44 (0)1425 624700
Genetix Group plc  Annual Report and Accounts 2004
Genetix Group plc
Annual Report and Accounts 2004