DAWSON INTERNATIONAL PLC
Annual Report & Accounts 2009 01 Financial and Operational Highlights
02 Chairman’s Statement
05 Chief Executive’s Statement
07 Business Review
15 Financial Review
18 Board of Directors
19 Accounts Contents
20 Directors’ Report
21 Directors’ Report on Remuneration
24 Statement of Directors’ Responsibilities
25 Independent Auditors’ Report to the 
 Members of Dawson International PLC
26 Consolidated Financial Statements
29 Notes to the Consolidated Financial Statements
57 Company Balance Sheet
58 Notes to the Company Financial Statements
61 Five Year Financial Record
62 Information for Shareholders
63 Notice of Annual General Meeting
67 Form of Proxy Financial Highlights
 2009 2008
 £000 £000
Continuing Operations:
Turnover 72,883 85,713
Operating profit before exceptional items 1,406 517
Operating profit after exceptional items 1,962 1,859
Pre tax profit 575 1,120
Net assets 1,494 20,240
Net pension scheme liabilities (19,246) (6,730)
Net funds 12,343 5,688
Discontinued Operations:
Operating loss after exceptional items (927) (498)
Loss on disposal (5,200) –
Pre tax loss (6,127) (498)
Basic and diluted (loss) earnings per share (pence) (2.6) 0.2
Adjusted loss per share (pence) (0.1) (0.1)
Operational Highlights
• Operating profit of £2.0 million from continuing operations
• Excellent performance by Knitwear divisions
• Home Furnishings Private Label division impacted by Sterling weakness
• Strategically important disposal of Todd & Duncan achieved in difficult 
economic climate
• Recovered £1.0 million debt due from previous joint venture partner
• Generated cash of £6.7 million including £5.4 million from the disposal  
of Todd & Duncan
• Ended the year with £12.3 million funds and no debt
• Increase in pension liabilities represents a challenge for the Company
Annual Report & Accounts 2009  Financial and Operational Highlights  01 Chairman’s Statement
In a year of global economic recession and an uncertain outlook in all of our 
markets, Dawson International delivered a satisfactory trading performance 
from continuing operations reporting an operating profit of £2.0 million  
(2008: £1.9 million) and generating funds of £6.7 million (2008: £11.4 million).
02  Chairman’s Statement  Annual Report & Accounts 2009 Strategy
These trading results have been achieved through our strategy 
to maximise the inherent strengths and proven track record of 
profitability within our core businesses. Concluding the sale of the 
loss making Todd & Duncan business during the year has been 
a significant achievement and the winding down of the Home 
Furnishings Branded business following the sale of the Dorma brand 
to Dunelm Group in July 2008 has made considerable progress.
Performance
I am pleased to report an operating profit from continuing 
operations of £2.0 million (2008: £1.9 million). This included a net 
gain from exceptional items of £0.6 million (2008: £1.3 million) 
which is discussed in the Financial Review. Both Knitwear divisions 
performed well, maintaining profits despite reductions in sales 
volumes. The phased exit from our Home Furnishings Branded 
division continued to plan with turnover and operating losses much 
reduced. The only operational disappointment in an otherwise 
satisfactory year was the performance of the Home Furnishings 
Private Label division where margins were impacted by higher 
product costs due to Sterling weakness.
Our strategy of staying close to customers in these challenging 
times and finding ways of adapting product and price point to 
respond to volatile market demands, whilst continuing to build 
on our strengths in design, product innovation and supply chain 
management, has largely been successful. It enabled us to deliver 
a strong final quarter in 2009, which saw improved demand in both 
our UK and US Knitwear businesses.
The sale of the Todd & Duncan business to Ningxia Zhongyin 
Cashmere Company Limited completed on 28 August 2009. The 
subjects of the sale were the business operations, fixed assets 
and stocks. The business made an operating loss of £0.9 million 
in the period and incurred a loss on disposal of £5.2 million. Funds 
of £8.1 million were generated from the disposal and subsequent 
liquidation of working capital, which have been used to eliminate all 
UK borrowings.
“Our strategy of staying close to 
customers in these challenging 
times and finding ways of 
adapting product and price point 
to respond to volatile market 
demands, whilst continuing to 
build on our strengths in design, 
product innovation and supply 
chain management, has largely 
been successful.”
Barrie
Barrie operates at the top end of the 
luxury cashmere knitwear market 
with its brands John Laing, Barrie and 
Glenmac. It designs, develops and 
manufactures highest quality cashmere 
knitwear for some of the world’s most 
prestigious couture houses.
Annual Report & Accounts 2009  Chairman’s Statement  03 Pensions
The pension scheme liabilities reported in the balance sheet are 
calculated in accordance with IAS 19. On this basis the liabilities 
increased from £6.7 million to £19.3 million, mainly due to lower 
corporate bond yields, which are used to discount liabilities, and 
increased life expectancy assumptions.
The level of contributions paid by the Company is based on a full 
actuarial valuation of scheme liabilities which is updated by the 
independent scheme actuary every three years. A triennial valuation 
is currently being finalised which is expected to show a significantly 
higher deficit than both the IAS 19 valuation and the last triennial 
valuation mainly due to more conservative assumptions used by the 
scheme actuary concerning life expectancy and discount factors. 
This escalation of the deficit represents a significant challenge for the 
UK businesses as it is likely to create future demands for increased 
financial support from the pension schemes. Discussions are 
ongoing with the Pensions Trustees and the Pensions Regulator to 
agree the way forward.
This issue is of course not unique to Dawson International and it is 
my view that a co-ordinated approach must be taken that shares 
the burden of reducing deficits and associated costs fairly amongst 
the various stakeholders involved.
Funding
We begin 2010 in a strong cash position with funds of £12.3 million 
(2008: £5.7 million). This improved position has resulted principally 
from the disposal of Todd & Duncan.
The Group has seasonal working capital funding requirements in 
both the USA and UK which are financed by asset backed facilities 
provided by Bank of America and Gmac Commercial Finance 
(“Gmac”) respectively. These facilities are due to be renewed in 2010. 
While Bank of America have provided verbal confirmation that they 
expect to renew the US facility on its existing terms for a further 
three years, Gmac have advised that they are withdrawing from 
the UK market and the facility will not be renewed when it expires 
in October 2010. The Directors have commenced the process of 
finding replacement facilities. They are currently talking to a number 
of financial institutions and based on those discussions are confident 
that they will be able to agree an adequate new facility.
Board and Management
Following my appointment as Interim Chairman on 8 May 2009 
the position was confirmed on 9 March 2010 with the support of 
shareholders holding a majority of shares. I have offered myself for 
re-election at the Annual General Meeting to enable all shareholders 
to vote on this issue.
Giovanni Ghione was appointed senior adviser to the Board on 
17 June 2009. On 1 February 2010 he was re-appointed to the 
Board as Deputy Chairman. I am pleased to welcome him and value 
his wealth of experience in the textiles industry, particularly in the 
important Italian market. His appointment also improves the balance 
of shareholder representation on the Board.
Employees
I would like to acknowledge the very difficult challenges faced by 
employees in all of our Group businesses during this turbulent 
economic environment. I thank everyone for their continued 
resilience and efforts to sustain existing business and their creative 
approach to maximising opportunities as they emerge. It is this drive 
and determination that has seen the Group return a satisfactory 
performance in a difficult year.
Outlook
Through the planned exit from loss making divisions, 2010 presents 
an opportunity to build on solid foundations and focus entirely on 
our profitable core businesses. A key priority during the year will be 
to seek ways in which to reduce the pension deficit and associated 
costs by working with the Pension Trustees to reduce liabilities and 
increase returns on assets. This is likely to restrict any development 
of the Group through potential acquisitions until substantial progress 
is made in this area.
Although there are some signs of markets stabilising, we expect 
trading to continue to be tough throughout 2010. Our approach 
to 2009 has demonstrated that we are able to take the necessary 
steps to weather these difficult trading conditions constructively 
and take advantage of opportunities as they present themselves. 
With strong, focused management teams in all of our businesses 
the Board is confident we can maintain and develop our businesses 
during the course of 2010.
David Bolton | Chairman 
04  Chairman’s Statement  Annual Report & Accounts 2009 Dawson Forte
Dawson Forte sources cashmere 
garments from China for US private 
label retail programmes and its own 
branded cashmere collection ‘Kinross’.
Annual Report & Accounts 2009  Chief Executive’s Statement  05
Chief Executive’s Statement
2009 was a challenging year with global economic conditions impacting product demand and 
pricing in all of the markets in which we operate. It is therefore a strong reflection on current 
strategy and the strength of our management teams that the Group’s continuing operations 
generated an operating profit of £2.0 million in such a demanding environment. 
This is particularly pleasing given the rapid deterioration of Sterling 
against the Dollar in late 2008 and its impact on our Home 
Furnishings division in 2009, which effectively increased costs by 
18 per cent in a market where it was not possible to raise prices  
to compensate.
Against this challenging backdrop I believe the Group performed 
very well and made considerable progress in 2009:
– The Group was able to build on the significant improvements 
made in 2008 and improve operating profit from continuing 
operations by 5.5 per cent against the previous year;
– Cash of £6.7 million was generated including £5.4 million directly 
from the disposal of the Todd & Duncan business. Since the 
beginning of 2008 the Group has generated over £18 million 
of cash from a combination of trading performance, business 
disposals and associated working capital release and closed 
2009 with a positive net cash position of £12.3 million;
– The Knitwear divisions sustained their exceptional performance, 
given that sales were down 17 per cent but managed to return 
an operating profit within four per cent of last year’s record result. 
Overall, the Knitwear divisions achieved an operating profit of 
£4.9 million, a return of 13.4 per cent against sales.
In addition, the Group made continued progress on a number of 
strategic fronts creating a platform to support growth and value 
creation in future years. These include the sale of its capital intensive 
and loss-making Todd & Duncan cashmere yarn business to  
Ningxia Zhongyin Cashmere Company in August 2009. The  
disposal streamlines the Group structure and creates an opportunity 
to move forward with a core of businesses capable of generating 
excellent returns.
As noted in our 2008 annual report and 2009 interim report, the 
Company was able to resuscitate a long standing debt due to 
it by Inner Mongolia King Deer Cashmere Company Limited of 
approximately $10 million, which had been fully provided for. The 
first scheduled payments against an agreed payment plan were 
received during the year; $0.5 million was received in the first half of 
the year and $1.0 million in the second half. Considering the age of 
the debt, at present the Company considers it appropriate to retain 
full provision for the outstanding balance.
“The Group made 
continued progress on a 
number of strategic fronts 
creating a platform to 
support growth and value 
creation in future years.” 06  Chief Executive’s Statement  Annual Report & Accounts 2009
The streamlined organisation is now aligned with our strategic 
focus to develop businesses with strengths in design, product 
development and supply chain management capable of delivering 
high quality, innovative products consistently on time. Product 
offerings are complemented by extensive service for customers 
seeking turnkey design, merchandising and supply chain solutions. 
Our strategy of staying close to customers and developing and 
maintaining an in-depth understanding of their changing needs, 
particularly in these challenging economic conditions, will remain 
core to our approach, resulting in product ranges that out-perform 
the competition at retail.
As reported in the Chairman’s Statement, our pension deficit 
has increased sharply in the year, growing by £12.6 million due 
to changes in corporate bond rates, which are used to discount 
liabilities, and increases in assumed life expectancy. While these 
factors are largely outside of management’s control, it is important 
to recognise that this issue has a significant impact on shareholder 
value. One of our key objectives for 2010 is to finalise negotiations 
with the Pension Trustees on an affordable arrangement that 
addresses the Group’s commitments to its pension plan members. 
However, at the same time this agreement must ensure that the 
Group retains the resources necessary to fund growth, and that 
shareholders can share equitably in the future benefits of the 
business. In the last few years we have made significant operational 
and structural improvements in the Group. Addressing this major 
remaining legacy issue will enable us to sustain these improvements 
and translate them into increased value for shareholders.
Outlook
Whilst we are seeing some signs of recovery, selling conditions 
remain very challenging, particularly in the US. Commodity price 
inflation is also becoming a factor in cashmere fibre and cotton, 
negatively impacting our Knitwear divisions and Home Furnishings 
division respectively. Despite this, we enter 2010 with positive 
momentum, a much stronger financial position and a revitalised 
organisation well positioned to grow market share and capitalise 
on improving economic conditions. We continue to make 
excellent progress towards our goals of sustained profitability and 
delivering consistent competitive returns on capital employed. As a 
management team we look forward to continuing this progress in 
2010 and beyond.
Andy Bartmess | Chief Executive
Dawson Home Group
Dawson Home Group is a leading 
supplier of own label bed linen to a 
range of quality high street retailers. Business Review
Following the disposal of the Todd & Duncan yarn spinning division in August 2009, the 
continuing operations of the Group are analysed into four reporting divisions: UK Knitwear, 
US Knitwear, Home Furnishings Private Label and Home Furnishings Branded. The Home 
Furnishings Branded division is being wound down following the sale of the ‘Dorma’ brand 
in 2008 but is included within continuing operations as required by International Financial 
Reporting Standards. In addition there is a central administrative function. The operations 
of each are reviewed in the following sections of this report, as are the results of the 
discontinued Todd & Duncan division.
UK Knitwear
 2009 2008
 £000 £000
Revenue 7,896 10,032
Operating profit before exceptional items 1,133 1,507
Exceptional items (125) –
Capital expenditure 80 210
Average capital employed* (101) 720
The UK Knitwear division comprises the Barrie Knitwear business, 
based in Hawick, Scotland. It manufactures highest quality 
cashmere garments at its factory in the Scottish Borders and 
sells to some of the world’s most prestigious couture houses, 
department stores and private label retail outlets.
* Average capital employed figures are derived from monthly management 
results and comprise fixed assets, working capital and provisions. Central 
assets and liabilities are not reallocated to divisions.
Performance
Following an exceptional year in 2008 and the growing economic 
uncertainty, Barrie’s turnover was expected to decline in 2009. 
This proved to be the case with a decrease of 21 per cent to 
£7.9 million. Export sales were down due to a reduction in couture 
sales and ‘John Laing’ branded knitwear in the USA. UK sales grew 
principally due to an increase in lower margin contract business. The 
net impact was a poorer sales mix overall. The business did benefit 
from an improved sales mix in the final quarter of the year with 
higher margin sales to couture customers brought forward at the 
customer’s request. This is likely to have some negative impact on 
the first quarter of 2010 with the sales mix impact reversing.
Gross profits fell as a result of the lower turnover however variable 
sales costs and operating overheads also reduced significantly, 
partly due to the lower turnover, and partly due to cost reductions 
and savings across the business. The business therefore achieved 
another excellent result, reporting an operating profit before 
exceptional items of £1.1 million.
Exceptional costs of £0.125 million were incurred in respect of a 
redundancy programme announced in May 2009 comprising 19 
jobs losses required to bring production into line with demand.
Position at Year End and Outlook
2010 has started positively with order book volumes significantly 
higher than the same time last year, although the current order book 
is biased more towards low margin contract business than was the 
case in 2009.
With the exception of the USA, Barrie’s main markets appear 
to have stabilised and higher order intake levels are expected. 
However, the USA market does not yet show signs of stability or any 
return to historical volumes.
Annual Report & Accounts 2009  Business Review  07
The following sections contain a number of forward looking statements regarding the prospects of the Group and its individual businesses 
which may not be realised and should therefore be treated with an appropriate degree of caution. Business Review (continued)
US Knitwear
 2009 2008
 $000 $000
Revenue 44,994 62,871
Operating profit 5,918 6,631
Capital expenditure 58 65
Average capital employed 4,549 9,281
 £000 £000
Revenue 28,695 34,023
Operating profit 3,774 3,588
Exchange Rate
– Average for the year $1.57 $1.85
– Year end $1.62 $1.45
The US Knitwear division comprises the Dawson Forte Cashmere 
business based in Boston, Massachusetts, USA. Dawson Forte 
sources cashmere garments from China for US private label retail 
programmes and its own branded cashmere collection ‘Kinross’.
Performance
While turnover was down 28 per cent to $45.0 million reflecting the 
challenging US economy, Dawson Forte was able to maximise both 
branded and private label margins and maintain tight control of costs 
and working capital. Consequently, profit for the full year fell just 
11 per cent to $5.9 million based on excellent margin performance. 
With the US Dollar 18 per cent stronger in 2009, Sterling reported 
profits were 5 per cent higher than 2008 at £3.8 million.
The business implemented a range of improved marketing initiatives 
including increased tradeshow presence. Supply chain performance 
improved during the year with over 99 per cent of orders delivered to 
customers on time during the year. The business also successfully 
managed its working capital investment, halving its average net 
operating assets.
The final quarter of 2009 saw the business sustain sales and 
margins in spite of the fragile US economic environment. In 
particular, in-season reorder sales of branded lines and overall 
margin levels were both stronger than expected.
Position at Year End and Outlook
The US economy has seen modest improvement throughout 
2009. Retailers reported improved sales during December 2009. 
Unemployment in the US remains high resulting in consumers 
continuing to be cautious, which is constraining retail sales. Overall it 
is anticipated that the economy will continue to recover in 2010 but 
at a slow pace.
08  Business Review  Annual Report & Accounts 2009 Business Review (continued)
Home Furnishings Private Label
 2009 2008
 £000 £000
Revenue 24,795 21,766
Operating (loss) profit (117) 2,862
Capital expenditure 31 2
Average capital employed 4,441 3,932
The Home Furnishings Private Label division is part of Dawson 
Home Group, based in Manchester, England. It designs and 
sources bed linen products, for sale to retailers.
Performance
Despite very difficult market conditions, turnover increased by 14 per 
cent to £24.8 million. This growth reflected strong performances by 
some key customers, increased market share driven by our premium 
design capability and excellent service, and the addition of new 
customers during the year.
However, as projected in last year’s annual report, margins in this 
business were severely impacted by the decline in the value of 
Sterling against the US Dollar at the end of 2008. This business 
sources most of its products in US Dollars and sells almost exclusively 
in Sterling. The average Dollar/Sterling exchange rate for 2009 
was $1.57 compared with $1.85 in 2008 which had the effect of 
increasing our average cost by around 18 per cent. Due to the speed 
with which this change occurred and the very difficult economic 
circumstances that prevailed it was impossible to recover the increase 
by raising prices. As a result, gross margins fell sharply. Rising product 
costs were offset to some extent by negotiating better prices from 
suppliers, moving production to lower cost locations and tightening 
operating costs. However, the net result was an operating loss of 
£0.1 million in 2009 against a profit of £2.9 million in 2008.
Position at Year End and Outlook
The outlook for 2010 is cautiously optimistic despite indications that 
cotton commodity prices are increasing. A number of positive trends 
are emerging: market conditions in the UK appear to be improving, 
Sterling strengthened against the Dollar in the second half of 2009 
and some of this improvement has been secured through forward 
currency contracts. Increased sales are anticipated from new 
customer gains in 2009.
Annual Report & Accounts 2009  Business Review  09 Business Review (continued)
Home Furnishings Branded
 2009 2008
 £000 £000
Revenue 11,497 19,892
Operating loss before exceptional items (1,365) (2,422)
Exceptional items – (157)
Closure provisions 613 2,316
The Home Furnishings Branded division is part of Dawson Home 
Group, based in Manchester, England. Previously it sold ‘Dorma’ 
branded product through various channels but primarily through 
retail concessions. In 2008 the Dorma trademark was sold to 
Dunelm Group plc and the business entered a wind down phase.
This process, which involves exiting from retail operations and 
liquidating working capital, is expected to conclude by mid 
2010. During 2009 the planned exit from 68 department store 
concessions was completed, leaving a final 39 to close in the 
first six months of 2010. As a result of the reduced number of 
concessions, sales in 2009 fell to £11.5 million from £19.9 million 
in 2008, and operating losses fell to £1.4 million from £2.4 million.
A further operating loss will be incurred in 2010 as the exit from 
this business is completed. In addition, final closure costs of 
£0.6 million are expected, which have been fully provided.
10  Business Review  Annual Report & Accounts 2009 Business Review (continued)
Central Costs
 2009 2008
 £000 £000
Payroll costs 897 1,381
Pension related costs 795 906
Legal, professional and treasury fees 321 656
Other costs 215 615
T otal costs before exchange and exceptional items 2,228 3,558
Exchange gain (loss) 209 (1,460)
Net exceptional income 681 –
The Group has a central administrative and treasury function based in 
Kinross, Scotland. All costs not directly incurred or attributable to the 
divisions are borne centrally.
Payroll costs comprise the remuneration, inclusive of pension costs, 
of the Executive Directors and the corporate office staff and the fees 
paid to the Non-Executive Directors.
Pension related costs comprise the pension protection fund levy 
of £0.4 million (2008: £0.4 million) and adviser fees of £0.4 million 
(2008: £0.5 million). All pension fees, with the exception of investment 
manager fees are borne by the Company. In addition to these costs 
the Company made deficit repair contributions of £0.35 million 
(2008: £0.9 million) to the UK plans and £0.25 million (2008: nil) to 
the closed USA plan.
The level of legal, professional and treasury fees reflects the relative 
complexity of the Group with its overseas operations, legacy issues 
from discontinued operations and restructuring activities. These costs 
have reduced significantly as the Group structure has simplified.
Other costs are mainly the administrative and facility costs associated 
with running the central function and any legacy costs associated with 
discontinued activities. In 2008 these included £0.25 million rental 
expense in respect of the Kinross leasehold property.
An exchange gain of £0.2 million was recorded in the year compared 
with a loss of £1.5 million in 2008.
Net exceptional income of £0.7 million was recorded (2008: nil), 
comprising £1.0 million income from the recovery of a long standing 
debt due from the Company’s former joint venture partner offset by a 
charge of £0.3 million to exit from an onerous property lease.
Annual Report & Accounts 2009  Business Review  11 Business Review (continued)
Discontinued Operations
 2009 2008
 £000 £000
Revenue 14,625 21,514
Operating (loss) profit before exceptional items (927) 502
Exceptional operating charge – (1,000)
Exceptional loss on disposal (5,200) –
Year end net assets 637 14,743
The sale of the Todd & Duncan business to Ningxia Zhongyin 
Cashmere Company Limited was completed on 28 August 2009. 
The subjects of the sale were the business operations, fixed assets 
and stocks. The Company retained the debtors and creditors, 
the majority of which have been realised during the second half of 
2009.
The business incurred a pre-exceptional trading loss of £0.9 million 
in the year (2008: £0.5 million profit). A loss of £5.2 million was 
incurred on disposal of the business. Net assets at the end of the 
year mainly comprise the remaining trade debtors of the business 
which had extended credit terms and are expected to be collected 
during the course of the current year. 
12  Business Review  Annual Report & Accounts 2009 Business Review (continued)
Business Risks
In common with all businesses, the Group is exposed to various 
risks and uncertainties, which could have a material effect on 
future results. There are review processes in place which seek to 
identify these risks and mitigate them where possible. The principal 
risks identified and the actions taken to mitigate them are as 
follows:
Customer and Supplier Dependency
Although the businesses each have fairly wide and diverse 
overall customer bases, each also has a small number of large 
customers. The loss of any of these customers could severely 
impact sales and profits. Each division also sources its products 
from a handful of high quality suppliers. While the loss of any one 
of these would not have the same impact as the loss of a large 
customer, it would be disruptive and could cause short-term 
delivery issues.
Group personnel work very hard to maintain and enhance their 
relationships with key customers to ensure the continuity of these 
relationships. This area has been one of the Group’s key strengths 
and a significant element of its recent success. Group companies 
also maintain close contact with their supply base, with frequent 
factory visits and often with quality control personnel working in 
the factories during order production to ensure issues are identified 
well in advance and to minimise the risk of supply disruption.
Key Personnel
Each business relies on a core of highly-qualified, talented and 
experienced managers and staff. The loss of any of these key 
individuals can lead to short-term negative impact to sales or 
operations.
The Group closely monitors its relationships with these key 
individuals and has incentive programmes in place to ensure 
their contributions are adequately rewarded. This creates an 
environment that encourages the retention of key individuals and 
ensures that they have incentives in place to continue to perform 
and excel. As a result, the Group has an excellent record of 
retaining these individuals. For the businesses operating in the 
UK, the Group also has employment contracts in place for these 
individuals with adequate notice periods to minimise business 
disruption.
Overseas Competition
Each business faces competition from low cost overseas 
competitors. There is the risk that customers, especially in difficult 
economic times, will choose to move their orders to these low 
cost competitors. This risk is not a new one and Group companies 
have successfully competed against low cost foreign competitors 
over a number of years. They do this by offering products and 
customer service that are superior to those offered by low cost 
competitors.
Fashion Trends
The products of each business are to some extent fashion items 
and therefore subject to consumer tastes and fashion trends. If the 
Group’s divisions design products that do not adequately reflect 
fashion trends, or do not appeal to core customers, sales can be 
negatively impacted. Due to the seasonality of sales and relatively 
long lead times, it is necessary to produce some goods in advance 
of the selling season, at a time when fashion trends and customer 
demand are uncertain. This creates stock dormancy risk.
Group designers work very closely with customers to ensure that 
finished products appeal both to trade customers and consumers. 
The fact that most of the Group’s products are designed to the 
specific needs of an individual customer also helps to minimise this 
risk. Designers spend a great deal of time monitoring conditions 
at retail and attending trade and fashion shows to stay abreast of 
the latest trends. In cases where goods must be manufactured 
in advance of customer orders, statistical analyses are used to 
ensure the goods produced in advance are very likely to sell based 
on historical sales patterns.
Annual Report & Accounts 2009  Business Review  13 Business Review (continued)
14  Business Review  Annual Report & Accounts 2009
Political
Each business sources product from countries where political 
systems and economic circumstances can be subject to some 
instability. This causes a risk of supply disruption. There is also the 
possibility of protectionist actions by the governments of countries 
in which the Group operates. This creates a risk of short-term 
supply disruptions and cost increases.
Group sourcing personnel spend a great deal of time in source 
countries to ensure they have the latest information on local 
conditions. In the case of China, both the Knitwear and Home 
Furnishings divisions maintain local offices with full-time staff 
permanently resident in the country. The Group also closely 
monitors political developments in the countries where it operates 
to ensure it has as much advance warning as possible of new 
legislation or regulations that could impact its businesses and take 
appropriate action to mitigate any associated risk.
Financial
Foreign exchange risk
For the Group’s UK based businesses, most product is sourced 
in US Dollars and sold in either Sterling or Euros. As a result, 
exchange rate movements between these currencies can have 
a significant impact on the short-term profitability of these 
businesses. Results are most exposed to negative impact by the 
US Dollar strengthening against Sterling or by the Euro weakening 
against Sterling. The Group seeks to minimise this risk by entering 
into forward foreign exchange contracts. In 2009, it was the policy 
of the Group not to account for such contracts as cash flow 
hedges but to take any unrealised gain or loss to profit and loss in 
the period arising. This can result in timing differences in reported 
profits between accounting periods.
Price risk
Each business is exposed to the impact of price swings in 
commodities such as cashmere fibre, cotton and wool. These prices 
are monitored closely and, to the extent the market allows, reflected 
in the prices that Group companies charge for their products.
Funding risk: working capital cycle and facilities
Some of the Group’s businesses are highly seasonal and as 
a result have working capital patterns with significant peaks 
at certain times of the year. For these businesses to operate, 
adequate financing must be in place to fund working capital, 
including these working capital peaks. The Group finances its 
business through its own resources and with asset-backed 
financing facilities in the UK and USA.
Both facilities fall due for renewal in 2010. While our USA lender 
has indicated that its facility should be renewed on existing terms, 
our UK lender has advised that they are ceasing all operations 
in the UK and will not therefore be renewing that facility. It is 
expected that an alternative facility can be put in place however 
there is a risk that this cannot be achieved. While cashflow 
projections indicate adequate headroom without the UK facility 
being replaced, there is a risk that facilities could be inadequate to 
the Group’s needs should it trade significantly below expectations 
over a period of time.
The Group monitors cash flow and cash flow projections by 
business and this information is reviewed by Group finance 
management on a daily basis. To the extent cash flow forecasts 
deviate from plan, corrective actions are taken to ensure the Group 
maintains adequate headroom between its borrowing capacity and 
its cash needs. The Knitwear and Home Furnishings divisions are 
primarily private label businesses that source a high proportion of 
their goods against firm customer orders. Therefore, the working 
capital and funding requirements of these businesses automatically 
adjust; when sales are strong working capital levels tend to be 
high and when sales fall working capital levels fall as well.
Pensions
The Group has two defined pension schemes in the UK which are 
closed to new members and a defined benefit scheme in the USA 
which is closed to all members. As discussed in the Chairman’s 
Statement and the Chief Executive’s Statement the liabilities 
of these schemes are substantial in relation to the size of the 
Group, have increased significantly in the year and are sensitive to 
changes in factors outside of management control. There is a risk 
therefore that the Group may be unable to fund these liabilities in 
the future which could result in the insolvency of all or part of the 
Group.
The Group is engaged in positive dialogue with the Pension 
Trustees and the Pensions Regulator to agree a way forward that 
is acceptable to all parties. Financial Review
 2009 2008
Income Statement summary £000 £000
Continuing operations:
Revenue
– Continuing businesses 61,386 67,198
– Home Furnishings Branded 11,497 20,160
 72,883 87,358
Operating profit before exceptional items
– Continuing businesses 2,771 2,939
– Home Furnishings Branded (1,365) (2,422)
 1,406 517
Exceptional items 556 1,342
Operating profit after exceptional items 1,962 1,859
Net finance costs
– on borrowings (498) (865)
– on pension obligations (889) 126
Taxation (291) (146)
Continuing operations profit after tax 284 974
Discontinued operations loss after tax (6,127) (498)
(Loss) profit after tax (5,843) 476
Operating results – continuing operations
In order to aid understanding of the underlying results of continuing 
operations, the results of the Home Furnishings Branded division 
which is being wound down have been shown separately.
The exit from the Home Furnishings Branded division continued to 
plan during the year with revenues reducing by £8.7 million to 
£11.5 million and operating losses reducing by £1.0 million to 
£1.4 million. This exit will be completed during the first half of 2010.
Revenues of the underlying continuing businesses fell by £5.8 million 
(9 per cent) to £61.4 million while operating profit before exceptional 
items fell by £0.1 million to £2.8 million:
– The UK Knitwear division reported revenues down £2.1 million at 
£7.9 million and pre-exceptional operating profit down £0.4 million 
at £1.1 million. 
– The US Knitwear division reported revenues down £5.3 million at 
£28.7 million but pre-exceptional operating profit up £0.2 million at 
£3.8 million. The stronger US Dollar benefited Sterling revenues by 
£4.4 million and pre-exceptional operating profit by £0.6 million.
– The Home Furnishings Private Label division reported revenues 
up £1.6 million at £24.8 million but a reduction in pre-exceptional 
operating profit, down £3.0 million to a loss of £0.1 million.
– Central costs before exchange gains and losses were £1.3 million 
lower at £2.2 million.
– An exchange gain of £0.2 million was recorded compared with a 
loss of £1.5 million in 2008.
The performance of each division is discussed in the Chief 
Executive’s Statement and the Business Review. The results of the 
Knitwear divisions are highly satisfactory having been achieved in a 
very challenging economic environment. The results of the Home 
Furnishings Private Label division were disappointing but were 
severely impacted by the abnormal rapid weakening of Sterling 
against the US Dollar in the second half of 2008 which resulted in 
product cost increases of approximately 18 per cent which could not 
be passed on to customers.
Exceptional Items
As noted in last year’s annual report, the Company agreed a payment 
plan with Inner Mongolia King Deer Cashmere Company Limited 
at the start of 2009 for the repayment of a long standing debt of 
approximately $10 million which had been fully provided in prior years. 
$1.5 million (£1.0 million) was received in the year in accordance with 
the payment plan and has been treated as an exceptional item. The 
balance remains fully provided with a further $2.5 million due to be 
received in 2010, $1.0 million in June and $1.5 million in December. 
The Company considers it appropriate to keep this debt fully provided 
at present as previous payment plans have been defaulted.
Exceptional charges totalling £0.4 million were recognised in the 
year, £0.1 million in respect of restructuring costs at the UK Knitwear 
division and £0.3 million for the costs of early termination of an 
onerous lease.
Further details are given in note 4 to the financial statements.
Net Finance Costs
Net finance costs, excluding pension related items, were £0.5 million 
on average net funds of £2.1 million (2008: £0.9 million on average 
net debt of £4.9 million). Effective interest rates are high due to the 
geographical spread of funds, the seasonal nature of the businesses 
which results in a significant inflow of funds in the final months of 
the year and the high fixed cost element of the Group’s asset based 
lending facilities.
The net finance cost on pension obligations was £0.9 million 
(2008: £0.1 million income). This is a notional charge only, calculated 
as the expected return on scheme assets in the year less the 
unwinding of one year’s discount on pension obligations. The high 
charge in the year reflects a low expected return on assets at the 
start of the year. In fact, asset returns were high due to recovery in 
the stock market with the resulting benefit taken through reserves.
Taxation
A tax charge of £0.3 million (2008: £0.2 million) was incurred in 
respect of state and federal taxes in the USA.
Earnings Per Share
The basic loss per share was 2.6 pence (2008: 0.2 pence earnings). 
The adjusted loss per share, calculated on the results of continuing 
operations before exceptional items was 0.1 pence (2008: 0.1 pence 
loss). The weighted average number of shares in issue was  
225.2 million (2008: 225.2 million).
Annual Report & Accounts 2009  Financial Review  15 Financial Review (continued)
Dividends
No dividends were paid or proposed in the year.
 2009 2008
Balance Sheet summary £000 £000
Fixed assets 1,068 2,416
Working capital 8,180 23,487
Other financial liabilities (51) (2,028)
Provisions (2,166) (3,951)
Tax asset 1,366 1,358
Pension deficit (19,246) (6,730)
Net funds 12,343 5,688
Net assets 1,494 20,240
Fixed Assets
Fixed assets reduced by £1.4 million in the year, £1.3 million due to 
the disposal of the Todd & Duncan business. Capital expenditure was 
£0.4 million and depreciation also £0.4 million.
Working Capital
Working capital reduced by £15.3 million in the year, £13.0 million due 
to the disposal of the Todd & Duncan business.
Other Financial Liabilities
As noted below, the policy of the Company is to enter into forward 
foreign exchange contracts to protect against the impact of 
unfavourable exchange movements on its forecast Euro sales and 
US Dollar purchases. These are not designated as cash flow hedges, 
instead any unrealised gains or losses arising on open contracts at 
the end of the year are taken to the Income Statement in the period 
and an asset or liability recorded in the balance sheet. At the year end 
the unrealised loss was £0.1 million (2008: £2.0 million).
Provisions
Provisions were £2.2 million at year end, comprising £0.8 million for 
reorganisation costs, £0.8 million for environmental liabilities, 
£0.2 million for the cost of exiting an onerous lease and £0.4 million 
for customer claims and unfunded retirement benefits. The provision 
for reorganisation costs will be utilised during the course of 2010.
Deferred Tax
IAS 12 requires that deferred tax liabilities are provided in full and that 
deferred tax assets be recognised to the extent they are considered 
recoverable. While there is a substantial potential deferred tax asset 
in the UK, no asset has been recognised on the basis that the UK 
operations have yet to demonstrate a consistent future income 
stream. A deferred tax asset of £1.75 million (2008: £1.5 million) has 
been recognised in the USA based on unexpired operating losses 
brought forward which can be set against the prospective profits of 
the US Knitwear division.
Pension Liabilities
Pension liabilities are calculated by applying IAS 19 which specifies 
that assets are measured at market value at the balance sheet date 
and liabilities are measured by discounting projected future benefit 
payments at AA corporate bond rates. The projected future benefit 
payments are based on a number of actuarial assumptions such as 
life expectancy and inflation.
On this basis the liability increased from £6.7 million to £19.3 million 
in the period, driven mainly by a reduction in AA corporate bond rates 
from 6.5 per cent to 5.8 per cent and an increase in assumed life 
expectancy. Contributions by the Company were £0.8 million 
(2008: £1.2 million) of which £0.2 million (2008: £0.3 million) was 
current service cost and £0.6 million (2008: £0.9 million) additional 
contributions to reduce the deficit.
16  Financial Review  Annual Report & Accounts 2009 Financial Review (continued)
Funding and Facilities
The Company was strongly cash generative in the year with an 
improvement in net funds of £6.7 million. Of this, £5.4 million was 
generated directly by the disposal of the Todd & Duncan business 
while a further £2.7 million was generated by the trading activities of 
the discontinued business, including the release of working capital.
Borrowing facilities currently comprise a working capital facility 
with Gmac Commercial Finance (“Gmac”) which funds the Group’s 
UK operations and a working capital facility with Bank of America 
which funds the Group’s US operation. As noted in the Chairman’s 
Statement, both facilities are due to be renewed in 2010. Bank of 
America have provided verbal confirmation that they expect the facility 
to be renewed on its existing terms for a further three years, however 
Gmac have advised that they are withdrawing from the UK market, 
and therefore the current facility running to October 2010 will not 
be renewed.
The Directors have commenced the process of finding a replacement 
facility in the UK. They are currently talking to a number of financial 
institutions and based on those discussions are confident that they 
will be able to agree an adequate new facility.
Treasury
The Group’s funding policy is to negotiate sufficient facilities to cover 
forecast net borrowings for the following 12 month period with 
adequate headroom against identified risks.
The Group’s policy on currency risk is to minimise the impact of 
currency risk on currency transaction flow through use of forward 
foreign exchange contracts. Due to uncertainty of timing of future 
cash flows these are not accounted for as cash flow hedges. Instead 
all gains and losses are recognised in the Income Statement in the 
period arising. This can result in timing differences with gains or losses 
on forward foreign exchange contracts marked to market at each 
reporting period.
Translation exposures on foreign currency net assets and income 
streams are not hedged.
Andy Bartmess | Chief Executive
David Cooper | Finance Director
Annual Report & Accounts 2009  Financial Review  17 Board of Directors
+*~ David Bolton (58)
Appointed Non-Executive Director on 29 July 2008 and Interim 
Chairman on 8 May 2009. The position of Chairman was confirmed 
on 9 March 2010. He is a chartered accountant with over 30 years 
experience in a variety of financial management positions across a 
range of industries, with particular expertise in improving operational 
performance and delivering business integration through acquisition. 
Currently Finance Director of computer software company, K3 
Business Technology Group plc.
Andy Bartmess (49)
Appointed Chief Executive Officer on 1 January 2007 following 
his appointment as Chief Operating Officer in November 2005. 
He joined the Board of Dawson on 15 February 2006. He was 
previously President of Dawson Forte Cashmere, the Group’s highly 
successful sourced cashmere garment business based in Boston, 
USA, acquired in 1997. Prior to joining Dawson Forte he held 
managerial positions with Deloitte Consulting and IBM.
David Cooper (51)
Appointed Finance Director of Dawson International PLC on  
1 January 2002, having previously been Group Financial Controller 
and Company Secretary. He joined the Company as Group Financial 
Accountant in 1986 and is a member of the Institute of Chartered 
Accountants of Scotland.
+*~ Jan G Holmstrom (57)
Appointed Non-Executive Director on 29 July 2008. An insurance 
professional and management consultant with a wealth of 
experience of working in the UK and in the Far East. He is currently 
Managing Director of Browallia AB, in Sweden, a subsidiary 
company of Bronsstadet AB. Browallia manages Bronsstadet’s 
foreign investments. Other directorships include Browallia Holdings 
Limited, Johnson and Starley Limited, The Union Discount 
Company of London Limited, Densitron Technologies plc and 
Hartest Holdings Plc.
*~ Giovanni Ghione (58)
Appointed Director and Deputy Chairman on 1 February 2010 having 
previously been a Non-Executive Director of Dawson International 
PLC between 2002 and 2006 and Deputy Chairman from 2004 until 
2006. He was formerly a director of International Fashion Limited and 
has served on the boards of a number of European merchant banks 
and property development companies.
+ Member of the Audit Committee
* Member of the Remuneration Committee
~ Member of the Nominations Committee 
18  Board of Directors  Annual Report & Accounts 2009 Accounts
Annual Report & Accounts 2009  Accounts Contents  19
20 Directors’ Report
21 Directors’ Report on Remuneration
24 Statement of Directors’ Responsibilities
25 Independent Auditors’ Report to the 
 Members of Dawson International PLC
26 Consolidated Financial Statements
29 Notes to the Consolidated Financial Statements
57 Company Balance Sheet
58 Notes to the Company Financial Statements
61 Five Year Financial Record
62 Information for Shareholders
63 Notice of Annual General Meeting
67 Form of Proxy Directors’ Report
The Directors present their report and the audited consolidated 
financial statements of the Company for the financial period ended 
2 January 2010.
Business Activities
The names and activities of the Group’s principal businesses are set 
out on page 59. A review of the activities of the Group for the period is 
given in the Business Review and Financial Review on pages 7 to 17.
Review of the Business
A review of the business which includes the financial results for 
the year, key performance indicators, the financial position at the 
year end, likely future developments and the principal risks and 
uncertainties facing the Group are contained in the Chairman’s 
Statement, the Chief Executive’s Statement and the Business Review 
and Financial Review on pages 2 to 17.
Going Concern
As discussed in the Chairman’s Statement on pages 2 to 4 and 
the Chief Executive’s Statement on pages 5 to 6, current economic 
conditions present some challenges to Group performance. The 
Group has also identified a number of business specific risks and 
uncertainties which are discussed in the Business Review on pages 
13 and 14.
The Group’s projections, taking account of the risks outlined, show 
that the Group should be able to operate within its current banking 
facilities. As a result, the Directors have a reasonable expectation 
that the Group has adequate resources to continue in operational 
existence for the foreseeable future. For this reason, they continue to 
adopt the going concern basis in preparing the financial statements.
Further details are given in note 1 to the consolidated financial 
statements.
Dividends
No interim or final dividend was paid or is proposed.
Substantial Shareholders
As at 9 March 2010 the Company had been notified of the following 
interests amounting to 3 per cent or more in its share capital:
Leeds Group plc  28.8%
Brian George White 8.9%
Global Asset Management  7.8%
Pontek Ltd (G Ghione) 7.8%
Fairmont Investment Trading Limited 7.5%
Guinness Peat Group plc  5.8%
Brookwell 4.6%
S di Canossa 3.8%
Directors
The names and biographical details of the present Directors are set 
out on page 18.
During the period, Michael G Hartley and Stephen Russell resigned 
from the Board of Directors following the AGM on 8 May 2009.
David Bolton was appointed Interim Chairman following the AGM 
on 8 May 2009 and this appointment was confirmed on 9 March 
2010 following consultations with shareholders holding a majority of 
shares. David Bolton now offers himself for re-election at the Annual 
General Meeting.
David Cooper retires by rotation from the Board at the Annual General 
Meeting and, being eligible, offers himself for re-election.
Subsequent to the year end, Giovanni Ghione was appointed a 
Director and Deputy Chairman of the Company on 1 February 2010.
The interests of the Directors in the share capital of the Company are 
set out in the Directors’ Report on Remuneration on pages 21 to 23.
Annual General Meeting
The Notice convening the Annual General Meeting for Wednesday 
5 May 2010 and the Resolutions to be considered at that meeting are 
set out on page 63. Special business to be proposed at the meeting 
is as follows:
Resolution 7 – Purchase of Own Shares by the Company
Resolution 7 confers authority on the Company to purchase its own 
shares up to an aggregate nominal value of £225,159 representing 
10 per cent of the issued ordinary share capital.
Resolution 8 – Reduction of Share Capital
Shareholders may remember that on 22 June 2004 a Special 
Resolution was passed by shareholders to cancel the Deferred 
Shares (which are of no value to shareholders). The Company has not 
yet implemented that Resolution and, given the passage of time, it 
is thought prudent to obtain confirmation of that Resolution which is 
contained in Resolution 8.
Employees
The Group provides all employees with equal opportunities for 
advancement regardless of their age, sex, race, creed or sexual 
orientation and encourages, where possible, the recruitment, training 
and career development of disabled people and any employees who 
may become disabled. It is also the Group’s policy to encourage the 
spread of information regarding developments affecting both the 
Group and an employee’s workplace.
Environment
The Group is conscious of the need to protect the quality of the 
environment and strives to meet or exceed applicable regulations at 
all locations.
Supplier Payment Policies
It is the policy of the Group to agree terms of payment when 
orders for goods and services are placed and to adhere to these 
arrangements when making payment. Purchases made by the 
Company itself are, with very few exceptions, made from subsidiaries 
and do not, therefore, involve taking credit from external suppliers.
Auditors
During the period, the Company’s Auditors changed to Deloitte LLP .
The Directors who held office at the date of approval of this Directors’ 
Report confirm that:
• 	 S o 	 f a r 	 a s 	 t h e y 	 a r e 	 e a c h 	 a w a r e , 	 t h e r e 	 i s 	 n o 	 r e l e v a n t 	 a u d i t	
information of which the Company’s auditors are unaware;
• 	 E a c h 	 D i r e c t o r 	 h a s 	 t a k e n 	 a l l 	 t h e 	 s t e p s 	 h e 	 o u g h t 	 t o 	 h a v e 	 t a k e n 	 a s 	 a	
Director to make himself aware of any relevant audit information 
and to establish that the Company’s auditors are aware of that 
information.
The Company’s auditors, Deloitte LLP have indicated that they are 
willing to continue in office and, accordingly, a Resolution proposing 
their formal appointment will be put to the Annual General Meeting.
By order of the Board
David Cooper, Secretary, 9 March 2010
20  Directors’ Report  Annual Report & Accounts 2009 Directors’ Report on Remuneration
As an AIM listed Company, Dawson International PLC is not 
required to comply with Section 8 of the Companies Act 2006, 
however the Directors feel it is appropriate to provide the following 
information to shareholders.
The Remuneration Committee
The Remuneration Committee is composed of the three 
Non-Executive Directors and is chaired by Jan G Holmstrom.
The role of the Committee is to make recommendations to the 
Board on all aspects of conditions of employment of the Company’s 
Executive Directors and on the terms and conditions of employment 
of senior management. It determines the structure of remuneration 
packages and sets the criteria for performance related components. 
The Committee may, at its discretion, seek external advice at the 
expense of the Company when setting remuneration levels. In the 
absence of any proposed changes to remuneration policy no external 
advice was sought in the year.
Remuneration Policy
The Committee aims to ensure that remuneration packages are 
offered which are designed to attract, retain and motivate high calibre 
Executive Directors and senior management.
As recommended by provision B.1.1 of the Combined Code 
performance related remuneration forms a significant proportion of 
the overall remuneration package of the Executive Directors and is 
designed to align their interests with those of the shareholders.
In addition to their basic salary the Executive Directors and senior 
management have had the potential to earn a bonus of between 
25 per cent and 100 per cent of basic salary, dependent on grade, 
through achievement of business performance targets and/or 
achievement of specific personal and strategic goals.
The share options held by Directors during the financial period and 
the performance criteria which are required to be met to enable their 
exercise are disclosed in table D.
The Board believes that it is in the best interests of the Company for 
the Executive Directors to accept external non-executive positions 
as this adds to the depth of their experience. The policy of the 
Board is that Executive Directors may accept external non-executive 
appointments and may retain any fees earned.
Directors’ Emoluments
Directors’ emoluments are summarised in table A.
In 2009 the bonus targets for the Chief Executive and Finance 
Director were based on achieving further improvement in net funds. 
Maximum bonus of 100 per cent of salary could be achieved for an 
improvement in net funds of £3.376 million, adjusted to eliminate the 
effect of certain exceptional items. After making such adjustments, 
the bonus payable for 2009 was 13 per cent of salary. M G Hartley 
had a maximum potential bonus of one third of salary based on 
achieving a specific strategic goal. 
In 2010 the bonus targets for the Chief Executive and Finance 
Director will be based 50 per cent on achievement of Group post 
tax profit targets and 50 per cent on achievement of Dawson Home 
Group (DHG) operating profit targets. In the case of Group post 
tax profits, a full bonus can be earned for a Group post tax profit of 
£1.5 million. In the case of DHG operating profit, a full bonus can be 
earned for an operating profit of £1.3 million. In either case, no bonus 
is payable if the Group fails to report a post tax profit or achieve 
budgeted cash targets. A full bonus of 100 per cent of salary is 
payable only if both Group and DHG targets are achieved.
Non-Executive Directors’ fees are currently £20,000 per annum with 
additional fees of £2,500 paid for chairing Board committees. The 
Non-Executive Chairman’s fee is £50,000 per annum.
Retirement Benefits
David Cooper participates in the Dawson International Staff 
Retirement Benefits Plan which normally provides a pension at age 65 
equal to two thirds of final pensionable salary after 40 years’ service, 
with attaching widows’ pension and lump sum death in service 
benefit. These benefits have been enhanced with a normal retirement 
age of 60 and the grant of a pension of two thirds final salary, inclusive 
of benefits earned in previous employments. Only basic salary is 
pensionable. Andy Bartmess participates in a defined contribution 
plan in the USA. The Group pays matched contributions up to 4 per 
cent of salary and a potential further 5 per cent based on the results 
of the Forte business.
Service Contracts
The Non-Executive Directors have formal engagement letters for 
services but do not have employment contracts with the Company. 
The service contract of Andy Bartmess commenced on 15 February 
2006. The notice periods to be given by the Company and 
Andy Bartmess are six months and two months respectively. The 
service contract of David Cooper commenced on 1 January 2002. 
The notice periods to be given by the Company and David Cooper 
are twelve months and three months respectively.
Annual Report & Accounts 2009  Directors’ Report on Remuneration  21 Directors’ Report on Remuneration (continued)
   Compensation
  Basic for loss  Taxable 2009 2008
 Fees salary of office Bonus  Benefits
(i)
 Total Total
 £000 £000 £000 £000 £000 £000 £000
D Bolton 40 – – – – 40 8
A D Bartmess 
(ii)
 – 217 – 28 22 267 390
D G Cooper – 124 – 16 11 151 259
J G Holmstrom 32 – – – – 32 8
 
Former Directors:
M G Hartley – 81 40 30 – 151 153
S B Russell 9 – – – – 9 24
Other – – – – – – 27
 81 422 40 74 33 650 869
(i) Taxable benefits comprise private health care cover and company car option.
(ii) A D Bartmess’ basic salary and bonus are US Dollar denominated and are translated at the average exchange rate for the year. Basic 
salary for 2009: $340,230 (2008: $340,230).
 2009 2008
 Number Number
D Bolton 100,000 –
A D Bartmess – –
D G Cooper 25,000 25,000
J G Holmstrom – –
G Ghione 17,862,450 16,987,450
No Director had any beneficial interest in the shares of any subsidiary undertaking.
 Accrued benefit Transfer value of accrued benefit
 Increase in year
 At   At At Increase less
 2 January Including Excluding 2 January 3 January Directors’
 2010 inflation inflation 2010 2009 contributions
 £000 £000 £000 £000 £000 £000
D G Cooper 59 4  4 1,105 814 281
Contributions of $16,590 (2008: $15,526) were paid into a defined contribution scheme in the USA in respect of A D Bartmess.
In 2009 the Trustees reviewed the assumptions used to calculate Cash Equivalent Transfer Values. In particular, this review resulted in an 
increase in the assumption made regarding how long members are expected to live after retirement. In addition, market conditions have 
changed significantly during 2009 with long-term assumed inflation in particular much higher at 31 December 2009 compared with 
31 December 2008. Combining these factors with the extra pension earned over the year has resulted in a significant increase in 
D G Cooper’s transfer value at 2 January 2010 compared to 3 January 2009. Transfer values are calculated by the scheme actuary. Due 
to the deficits in the pension schemes, transfer values are currently being reduced to reflect the level of underfunding. Correspondingly the 
transfer value of accrued benefit noted above would be reduced accordingly were D G Cooper to choose to transfer out of the plan at 
this time.
Table A – Directors’ Emoluments
Table C – Directors’ Shareholdings
Table B – Retirement Benefits
22  Directors’ Report on Remuneration  Annual Report & Accounts 2009 Directors’ Report on Remuneration (continued)
 Number of share options
  Exercise 2 January 3 January
  price 2010 2009 Vesting Expiry
  Pence 000s 000s date date
A D Bartmess Standard 10.5 400 400 16.05.2008 15.05.2015
 Super 10.5 400 400 16.05.2010 15.05.2015
 Standard 7.625 1,250 1,250 21.04.2009 20.04.2016
 Super 7.625 500 500 21.04.2011 20.04.2016
 
D G Cooper Standard 10.5 400 400 16.05.2008 15.05.2015
 Super 10.5 400 400 16.05.2010 15.05.2015
 Standard 7.625 1,250 1,250 21.04.2009 20.04.2016
 Super 7.625 500 500 21.04.2011 20.04.2016
M G Hartley Standard 7.625 750 750 21.04.2009 8.05.2010
  Super 7.625 300 300 08.05.2009 8.05.2010
(i) The exercise of standard options is subject to the achievement of targets of sustained improvement in the underlying performance of the 
Group as specified by the Directors at the date of grant.
(ii) The exercise of super options is subject to the achievement of targets of exceptional financial performance by the Group as specified by 
the Directors at the date of grant.
(iii) The market price of the Company’s shares at the year end was 1.875 pence. The range during the year was 1.0 pence – 3.25 pence.
The auditors are required to report on the information contained in tables A – D.
On behalf of the Board
Jan G Holmstrom, Chairman of the Remuneration Committee, 9 March 2010
Table D – Share Options
Annual Report & Accounts 2009  Directors’ Report on Remuneration  23 Statement of Directors’ Responsibilities
The Directors are responsible for preparing the Annual Report and 
the financial statements in accordance with applicable law and 
regulations.
Company law requires the Directors to prepare financial statements 
for each financial year. Under that law the Directors are required 
to prepare the Group financial statements in accordance with 
International Financial Reporting Standards (IFRSs) as adopted by the 
European Union and Article 4 of the IAS Regulation and have elected 
to prepare the Parent Company financial statements in accordance 
with United Kingdom Generally Accepted Accounting Practice (United 
Kingdom Accounting Standards and applicable law). Under company 
law the Directors must not approve the accounts unless they are 
satisfied that they give a true and fair view of the state of affairs of the 
Company and of the profit or loss of the Company for that period.
In preparing the Parent Company financial statements, the Directors 
are required to:
• 	 s e l e c t 	 s u i t a b l e 	 a c c o u n t i n g 	 p o l i c i e s 	 a n d 	 t h e n 	 a p p l y 	 t h e m	
consistently;
• 	 m a k e 	 j u d g m e n t s 	 a n d 	 a c c o u n t i n g 	 e s t i m a t e s 	 t h a t 	 a r e 	 r e a s o n a b l e	
and prudent; and
• 	 p r e p a r e 	 t h e 	 fi n a n c i a l 	 s t a t e m e n t s 	 o n 	 t h e 	 g o i n g 	 c o n c e r n 	 b a s i s	
unless it is inappropriate to presume that the Company will 
continue in business.
In preparing the Group financial statements, International Accounting 
Standard 1 requires that Directors:
•	 pr operly 	 select 	 and 	 apply 	 accounting 	 policies;
• 	 p r e s e n t 	 i n f o r m a t i o n , 	 i n c l u d i n g 	 a c c o u n t i n g 	 p o l i c i e s , 	 i n 	 a 	 m a n n e r	
that provides relevant, reliable, comparable and understandable 
information;
• 	 p r o v i d e 	 a d d i t i o n a l 	 d i s c l o s u r e s 	 w h e n 	 c o m p l i a n c e 	 w i t h 	 t h e	
specific requirements in IFRSs are insufficient to enable users to 
understand the impact of particular transactions, other events 
and conditions on the entity’s financial position and financial 
performance; and
• 	 m a k e 	 a n 	 a s s e s s m e n t 	 o f 	 t h e 	 C o m p a n y ’ s 	 a b i l i t y 	 t o 	 c o n t i n u e 	 a s 	 a	
going concern.
The Directors are responsible for keeping adequate accounting 
records that are sufficient to show and explain the Company’s 
transactions and disclose with reasonable accuracy at any time the 
financial position of the Company and enable them to ensure that 
the financial statements comply with the Companies Act 2006. 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.
The Directors are responsible for the maintenance and integrity of 
the corporate and financial information included on the Company’s 
website. Legislation in the United Kingdom governing the preparation 
and dissemination of financial statements may differ from legislation in 
other jurisdictions.
Responsibility Statement
We confirm that to the best of our knowledge:
• 	 t h e 	 fi n a n c i a l 	 s t a t e m e n t s , 	 p r e p a r e d 	 i n 	 a c c o r d a n c e 	 w i t h 	 t h e	
relevant financial reporting framework, give a true and fair view 
of the assets, liabilities, financial position and profit or loss of the 
Company and the undertakings included in the consolidation 
taken as a whole; and
• 	 t h e 	 m a n a g e m e n t 	 r e p o r t , 	 w h i c h 	 i s 	 i n c o r p o r a t e d 	 i n t o 	 t h e 	 D i r e c t o r s ’	
Report, includes a fair review of the development and performance 
of the business and the position of the Company and the 
undertakings included in the consolidation taken as a whole, 
together with a description of the principal risks and uncertainties 
that they face.
By order of the Board
Andy Bartmess | Chief Executive
David Cooper | Finance Director
9 March 2010
24  Statement of Directors’ Responsibilities  Annual Report & Accounts 2009 Independent Auditors’ Report to the Members of Dawson International PLC
We have audited the financial statements of Dawson International 
PLC for the year ended 2 January 2010 which comprise the 
Consolidated Income Statement, the Consolidated Statement of 
Comprehensive Income, the Consolidated and Parent Company 
Balance Sheets, the Consolidated Cash Flow Statement, the 
Consolidated Statement of Changes in Equity and the related 
notes 1 to 26 and Company related notes 1 to 8. The financial 
reporting framework that has been applied in the preparation of 
the Group financial statements is applicable law and International 
Financial Reporting Standards (IFRSs) as adopted by the European 
Union. The financial reporting framework that has been applied 
in the preparation of the Parent Company financial statements is 
applicable law and United Kingdom Accounting Standards (United 
Kingdom Generally Accepted Accounting Practice).
This report is made solely to the Company’s members, as a body, in 
accordance with Chapter 3 of Part 16 of the Companies Act 2006. 
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 explained more fully in the Directors’ Responsibilities Statement, 
the Directors are responsible for the preparation of the financial 
statements and for being satisfied that they give a true and fair view. 
Our responsibility is to audit the financial statements in accordance 
with applicable law and International Standards on Auditing (UK and 
Ireland). Those standards require us to comply with the Auditing 
Practices Board’s (APB’s) Ethical Standards for Auditors.
Scope of the Audit of the Financial Statements
An audit involves obtaining evidence about the amounts and 
disclosures in the financial statements sufficient to give reasonable 
assurance that the financial statements are free from material 
misstatement, whether caused by fraud or error. This includes an 
assessment of: whether the accounting policies are appropriate to 
the Group’s and the Parent Company’s circumstances and have been 
consistently applied and adequately disclosed; the reasonableness 
of significant accounting estimates made by the Directors; and the 
overall presentation of the financial statements.
Opinion on Financial Statements
In our opinion:
•	 the 	 financial 	 statements 	 give 	 a 	 true 	 and 	 fair 	 view 	 of 	 the 	 state 	 of 	 the 	
Group’s and the Parent Company’s affairs as at 2 January 2010 
and of the Group’s loss for the year then ended;
• 	 t h e 	 G r o u p 	 fi n a n c i a l 	 s t a t e m e n t s 	 h a v e 	 b e e n 	 p r o p e r l y 	 p r e p a r e d 	 i n	
accordance with IFRSs as adopted by the European Union;
• 	 t h e 	 P a r e n t 	 C o m p a n y 	 fi n a n c i a l 	 s t a t e m e n t s 	 h a v e 	 b e e n 	 p r o p e r l y	
prepared in accordance with United Kingdom Generally Accepted 
Accounting Practice; and
•	 the 	 financial 	 statements 	 have 	 been 	 pr epar ed 	 in 	 accor dance 	 with 	
the requirements of the Companies Act 2006.
Opinion on Other Matters Prescribed by the Companies Act 2006
In our opinion:
• 	 t h e 	 p a r t 	 o f 	 t h e 	 D i r e c t o r s ’ 	 R e m u n e r a t i o n 	 R e p o r t 	 t o 	 b e 	 a u d i t e d 	 h a s	
been properly prepared in accordance with the provisions of the 
Companies Act 2006 that would have applied were the Company 
a listed Company; and
• 	 t h e 	 i n f o r m a t i o n 	 g i v e n 	 i n 	 t h e 	 D i r e c t o r s ’ 	 R e p o r t 	 f o r 	 t h e 	 fi n a n c i a l 	 y e a r	
for which the financial statements are prepared is consistent with 
the financial statements.
Matters on Which We are Required to Report by Exception
We have nothing to report in respect of the following matters where 
the Companies Act 2006 requires us to report to you if, in our opinion:
• 	 a d e q u a t e 	 a c c o u n t i n g 	 r e c o r d s 	 h a v e 	 n o t 	 b e e n 	 k e p t 	 b y 	 t h e 	 P a r e n t	
Company, or returns adequate for our audit have not been 
received from branches not visited by us; or
• 	 t h e 	 P a r e n t 	 C o m p a n y 	 fi n a n c i a l 	 s t a t e m e n t s 	 a r e 	 n o t 	 i n 	 a g r e e m e n t	
with the accounting records and returns; or
• 	 c e r t a i n 	 d i s c l o s u r e s 	 o f 	 D i r e c t o r s ’ 	 r e m u n e r a t i o n 	 s p e c i fi e d 	 b y 	 l a w 	 a r e	
not made; or
• 	 w e 	 h a v e 	 n o t 	 r e c e i v e d 	 a l l 	 t h e 	 i n f o r m a t i o n 	 a n d 	 e x p l a n a t i o n s 	 w e	
require for our audit.
Alan Fendall (Senior Statutory Auditor)
for and on behalf of Deloitte LLP
Chartered Accountants and Statutory Auditors 
Manchester, England, United Kingdom.
9 March 2010
Annual Report & Accounts 2009  Independent Auditors’ Report  25 Consolidated Income Statement
For the period ended 2 January 2010
   2008
  2009 re-presented
 Note £000 £000
Continuing operations
Revenue 2 72,883 85,713
Cost of sales  (55,744) (63,621)
Gross profit  17,139 22,092
Other operating income  82 –
Selling and distribution costs  (7,992) (12,484)
Administrative expenses  (7,823) (9,091)
Operating profit before exceptional items 2, 3 1,406 517
Exceptional items 2, 4 556 1,342
Operating profit 2, 3 1,962 1,859
Finance income 7 15 65
Finance costs 7 (513) (930)
Net finance (expense) income on pension assets/liabilities 20 (889) 126
Profit before taxation  575 1,120
Taxation 8 (291) (146)
Profit for the period from continuing operations  284 974
Discontinued operations
Loss for the period from discontinued operations 5 (6,127) (498)
(Loss) profit for the period  (5,843) 476
 
Basic and Diluted earnings (loss) per share
– From continuing operations 0.1p 0.4p
– From continuing and discontinued operations (2.6)p 0.2p
Consolidated Statement of Comprehensive Income
For the period ended 2 January 2010
  2009 2008
 Note £000 £000
(Loss) profit for the period  (5,843) 476
Other comprehensive income:
Exchange differences on translation of foreign subsidiaries  (577) 1,689
Actuarial loss on defined benefit pension obligations 20 (12,373) (2,533)
Other comprehensive income for the period  (12,950) (844)
Total comprehensive income for the period  (18,793) (368)
Total comprehensive income is all attributable to equity holders of the parent. There is no tax impact in respect of the components of other 
comprehensive income in either year.
26  Consolidated Financial Statements  Annual Report & Accounts 2009 Consolidated Balance Sheet
As at 2 January 2010
  2009 2008
 Note £000 £000
Non-current assets
Intangible assets 10 143 131
Property, plant and equipment 11 925 2,285
Deferred tax asset 12 1,750 1,500
Total non-current assets  2,818 3,916
Current assets
Inventories 13 8,309 24,090
Trade and other receivables 14 9,350 14,973
Cash and cash equivalents 15 12,343 9,900
Total current assets  30,002 48,963
Total assets  32,820 52,879
Current liabilities
Trade and other payables 16 9,479 15,576
Income tax payable  384 142
Borrowings 17 – 4,212
Provisions 19 1,144 1,977
Other financial liabilities 18 51 2,028
Total current liabilities  11,058 23,935
Non-current liabilities
Provisions 19 1,022 1,974
Retirement benefit obligations 20 19,246 6,730
Total non-current liabilities  20,268 8,704
Total liabilities  31,326 32,639
Net assets  1,494 20,240
Equity
Share capital 22 51,989 51,989
Share premium account 23 5,489 5,489
Translation reserve 23 240 818
Retained earnings 23 (56,224) (38,056)
Total equity  1,494 20,240
The financial statements of Dawson International PLC (registered number SC54505) were approved by the Board of Directors and 
authorised for issue on 9 March 2010. They were signed on its behalf by:
Andy Bartmess | Chief Executive
David Cooper | Finance Director
Consolidated Statement of Changes in Equity
 Share Share Translation Retained
 Capital Premium Reserve Earnings Total
 £000 £000 £000 £000 £000
At 29 December 2007 51,989 5,489 (871) (36,084) 20,523
Total comprehensive income for the period – – 1,689 (2,057) (368)
Share-based payments charge – – – 85 85
At 3 January 2009 51,989 5,489 818 (38,056) 20,240
Total comprehensive income for the period – – (578) (18,215) (18,793)
Share-based payments charge – – – 47 47
At 2 January 2010 51,989 5,489 240 (56,224) 1,494
Annual Report & Accounts 2009  Consolidated Financial Statements  27 Consolidated Cash Flow Statement
For the period ended 2 January 2010
   2008
  2009 re-presented
 Note £000 £000
Continuing operations
Cash flows from operating activities
Profit before tax  575 1,120
Depreciation  214 433
Gain on disposal of Dorma brand  – (1,517)
Net finance expense  1,387 739
Share-based payment expense  47 85
  2,223 860
Decrease in inventories  1,950 2,222
Decrease (increase) in receivables  1,799 (148)
(Decrease) increase in payables  (3,326) 1,842
Decrease in provisions  (1,711) (21)
Cash generated by operations  935 4,755
Additional contributions to pension schemes  (606) (887)
Taxes paid  (261) (231)
Net cash generated by operating activities  68 3,637
Cash flows from investing activities
Interest received  15 63
Proceeds from disposal of Todd & Duncan 5 5,426 –
Proceeds from disposal of Dorma brand  – 4,523
Purchase of property, plant and equipment  (114) (546)
Purchase of intangible assets  (59) (2)
Net cash generated by investing activities  5,268 4,038
Cash flows from financing activities
Interest paid  (513) (985)
Decrease in asset backed finance  (4,212) (7,602)
Net cash used by financing activities  (4,725) (8,587)
Net cash generated (used) by continuing operations  611 (912)
Discontinued operations
Net cash generated by operating activities  2,930 2,626
Net cash used by investing activities  (270) (18)
Net cash generated by discontinued operations  2,660 2,608
Net increase in cash and cash equivalents  3,271 1,696
Cash and cash equivalents at the beginning of the period  9,900 6,093
Exchange rate effects  (828) 2,111
Cash and cash equivalents at the end of the period  12,343 9,900
Reconciliation of Movement in Net Funds (Debt)
For the period ended 2 January 2010
 2009 2008
 £000 £000
Increase in cash and cash equivalents 3,271 1,696
Decrease in borrowings 4,212 7,602
Exchange rate effects (828) 2,111
Increase in net funds 6,655 11,409
Opening net funds (debt) 5,688 (5,721)
Closing net funds 12,343 5,688
28  Consolidated Financial Statements  Annual Report & Accounts 2009 1. Accounting policies
Dawson International PLC (“the Company”) is registered in Scotland. These financial statements consolidate the accounts of the 
Company and its subsidiary undertakings (together “the Group”) for the 52 weeks ended 2 January 2010. The comparative period is 
the 53 weeks ended 3 January 2009.
The financial statements were authorised for issue by the Directors on 9 March 2010.
Basis of preparation and significant accounting policies
The Group financial statements have been prepared and approved by the Directors in accordance with International Financial 
Reporting Standards as adopted by the EU (“Adopted IFRSs”).
The Company has elected to prepare its Parent Company financial statements in accordance with UK GAAP; these are presented on 
pages 57 to 60.
In carrying out their duties in respect of going concern, the Directors have reviewed the Group’s financial position and cash flow 
forecasts for a period of 12 months from the date of signing these financial statements. These have been based on a comprehensive 
review of revenue, expenditure and cash flows, taking into account specific business risks and the uncertainties brought about by 
the current economic environment.
The Group’s business activities, together with the factors likely to affect its future development, performance and position, including 
the principal business risks, are set out in the Chairman’s Statement, the Chief Executive’s Statement and in the Business Review on 
pages 2 to 14.
The Group’s working capital requirements are highly seasonal and are met, at certain points in the year by two separate asset 
backed financing facilities, one being available to support the Group’s US based operations (“the US bank”) and the other being 
provided to fund the UK businesses (“the UK bank”). Whilst the Group utilised these facilities during the year they were undrawn at 
2 January 2010 with a year end cash position of £12.3 million. Both facilities fall due for renewal during 2010. The Directors have 
had discussions with the US bank which has provided verbal confirmation that, subject to receipt of the 2009 financial statements of 
the US operations, they expect the facility to be renewed on its existing terms for a further three years. The UK bank has advised the 
Group that they are withdrawing from the UK market, and therefore the current facility running to October 2010 will not be renewed. 
The Directors have commenced the process of finding replacement facilities and are currently talking to a number of financial 
institutions and based on those discussions are confident that they will be able to agree a new facility.
Key assumptions made in these forecasts include the renewal of the US bank facility which the Directors are confident of securing, 
that the Group will not be required to significantly increase its deficit repair payments to the pension funds over the forecast period 
and that a special contribution to the pension funds from the proceeds of the Todd & Duncan disposal will not be enforced until the 
new UK facility has been agreed. The pension fund assumptions are based on the latest discussions with the Pension Fund Trustees, 
but final agreement has not yet been reached and therefore there remains uncertainty over the quantum and timing of pension 
fund contributions. However, on this basis the Group’s forecasts and projections, taking account of reasonably possible changes 
in trading performance and other business risks, show that the Group should be able to operate within the level of its current and 
forecast facilities in the absence of a replacement for the UK bank facility.
After making enquiries and having taken the above factors into consideration, the Directors have a reasonable expectation that the 
Company and the Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they 
continue to adopt the going concern basis in preparing the annual report and accounts.
On 28 August 2009 the Company completed the sale of the Todd & Duncan Yarn Spinning division. The results of this division have 
therefore been reported as a discontinued operation and comparative figures restated accordingly.
Adoption of new and revised standards
In the current year, the following new and revised Standards and Interpretations have been adopted and have affected the amounts 
reported in the financial statements.
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  29
Notes to the Consolidated Financial Statements Notes to the Consolidated Financial Statements (continued)
1. Accounting policies (continued)
IAS 1 (revised 2007) Presentation of financial statements has introduced a number of changes in the format and content of the 
financial statements. Specifically, IAS 1 requires an entity to present a statement of financial position as at the beginning of the earliest 
comparative period in a complete set of financial statements when the entity applies an accounting policy retrospectively or makes a 
retrospective restatement, or when the entity reclassifies items in the financial statements. During the current year, the Group adopted 
IFRS 8 ‘Operating Segments’. However, the Directors consider that because the adoption of the standard has no impact on the balance 
sheet, no presentation of a third balance sheet is required.
IFRS 8 Operating Segments is a disclosure Standard that has resulted in a re-designation of the Group’s reportable segments (see 
note 2).
IFRS 7 Financial Instruments has been amended to expand the disclosures required in respect of fair value measurements and 
liquidity risk. The Group has elected not to provide comparative information for these expanded disclosures in the current year in 
accordance with transitional reliefs available.
At the date of authorisation of these financial statements, the following Standards and Interpretations that are expected to impact on the 
Group but which have not been applied in these financial statements, were in issue but not yet effective:
•	 IFRS	2	(amended)	Shar e-based	payments
•	 IAS	39	(amended)	Financial	Instruments:	Recognition	and	Measur ement
•	 IAS	27	(amended)	Consolidated	and	separate	financial	statements
•	 IFRS	3	(amended)	Business	combinations
•	 Impr ovements	to	IFRSs	2009	(April	2009)
•	 IAS	28	(amended)	Investment	in	associates
•	 IFRIC	17	Distributions	of	non-cash	assets	to	owners
•	 IFRS	1	(amended)/IAS	27	(amended)	Cost	of	an	investment	in	a	subsidiary ,	jointly	contr olled	entity	or	associate
The Directors do not expect that the adoption of these Standards and Interpretations in future periods will have a material impact on the 
financial statements of the Group, except for the treatment of acquisition of subsidiaries and associates when IFRS 3 (amended 2008), 
IAS 27 (amended 2008) and IAS 28 (amended 2008) come into effect for business combinations for which the acquisition date is on or 
after the beginning of the first annual period beginning on or after 1 July 2009.
The impact of all other standards and interpretations not yet adopted is not expected to be material.
Basis of consolidation
The consolidated financial statements are prepared on the historical cost convention and are presented in Sterling, rounded to the 
nearest thousand.
Subsidiaries
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power to govern the financial and operating 
policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that currently are exercisable 
are taken into account. The accounting policies of subsidiaries are changed when necessary to align them with the policies adopted 
by the Group. As required by IFRS 3, the purchase method of accounting is applied. Under this method the results of subsidiary 
undertakings acquired or disposed of in the year are included in the Consolidated Income Statement from the date of acquisition or up 
to the date of their disposal.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated in 
preparing the consolidated financial statements.
30  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009 1. Accounting policies (continued)
Foreign currency
Transactional 
Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the 
dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to 
the functional currency at the exchange rate at that date. Exchange differences arising on translation are recognised in the Income 
Statement. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the 
functional currency at the exchange rate at the date that the fair value was determined. 
The Group may enter into forward foreign exchange contracts with the objective of offsetting the exchange gains and losses arising on 
transactional exposures. Unless designated as a cashflow or fair value hedge in accordance with IAS 39 any such contract is carried in 
the balance sheet at fair value at the reporting date with any change in the fair value reported in the Income Statement in the period. If 
designated as a cashflow or fair value hedge any gain or loss arising is recognised in equity until maturity of the hedged transaction. To 
the extent that the hedge is ineffective any gain or loss is recognised in the Income Statement in the period arising.
Translation 
The assets and liabilities of operations outside the UK are translated to Sterling at foreign exchange rates ruling at the balance sheet 
date. The revenues and expenses of foreign operations are translated to Sterling at the average rate for the period. Foreign exchange 
differences arising on retranslation of opening net assets or liabilities are recognised directly in equity.
Foreign exchange contracts may also be used to eliminate the translation exposure arising on loans between the Parent Company and 
overseas subsidiaries where the loans are denominated in the functional currency of the subsidiary. 
Operating segments
Operating segments are aligned with those reviewed by the ‘Chief Operating Decision Maker’ which is considered to be the Board of 
Directors. As a result, the Knitwear segment has been divided into UK and US Knitwear segments and the Home Furnishings segment 
has been divided into Private Label and Branded Home Furnishings segments. The 2008 comparatives have been restated for the 
adoption of IFRS 8. Details of the impact of these changes are set out in note 2 segmental analysis.
Revenue
Revenue represents the net invoice value of goods and services supplied to customers and royalty income from licensing, excluding 
discounts, value added tax and other sales taxes. Revenue is recognised when the significant risks and rewards of ownership have been 
transferred to the buyer, recovery of the consideration is probable, the associated costs and possible return of goods can be estimated 
reliably, there is no continuing management involvement with the goods, and the amount of revenue can be measured reliably.
2008 comparatives have been restated to treat discounts granted to customers of the Home Furnishings segments as a reduction in 
revenues rather than as part of cost of sales. The impact is to reduce both revenues and cost of sales by £1,645,000. The Consolidated 
Income Statement and the Segmental Analysis in note 2 have been re-stated accordingly.
Operating profit
Operating profit is stated after charging exceptional items, but before any finance income or expense.
Royalty income
Royalty income represents revenue earned under license agreements. Income is recognised when a sale is made by the licensee and 
the royalty thereon is advised to the Group in accordance with the license agreement.
Net financing costs
Finance income arising on funds invested by the Group is recognised in the Income Statement as it accrues, using the effective rate of 
interest method. Finance costs comprise interest payable on Group borrowings calculated using the effective interest rate method. Net 
financing income or cost on defined benefit pension plans represents the difference between the expected return on defined benefit plan 
assets and the unwinding of the discount on plan liabilities in the year.
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  31 1. Accounting policies (continued)
Goodwill
Goodwill arises on the acquisition of subsidiaries and represents the excess of the fair value of the consideration over the Group’s 
interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity acquired. When goodwill is positive it 
is recorded initially at cost and subsequently reduced for any impairment loss identified (see impairment policy below). When goodwill is 
negative it is recognised immediately in the Income Statement.
Intangible assets
Software licenses and implementation costs are capitalised at cost less accumulated amortisation. Amortisation is charged to the 
Income Statement on a straight-line basis over the estimated useful life of these software licenses. The annual rate used is as follows:
 Software licenses 25%
Property, plant and equipment
Items of property, plant and equipment are stated at cost less accumulated depreciation and impairments.
Depreciation is charged to the Income Statement to write off the cost, less expected residual values of property, plant and equipment 
on a straight line basis over their estimated useful lives. The annual rates used are as follows:
 Land Nil
 Freehold buildings 2% – 4%
 Leasehold buildings Over the term of the lease, minimum 2%
 Plant and machinery 10% – 25%
Inventories
Inventories are stated at the lower of cost, including manufacturing overheads where appropriate, and net realisable value. Net realisable 
value is estimated selling price in the ordinary course of business, less the estimated costs to completion and selling expenses.
The cost of inventories is based on standard costs. In the case of manufactured inventories and work in progress, costs include raw 
materials, other direct costs and related overheads based on normal operating capacity using standard costs.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits held with banks.
Impairment 
Financial assets
A financial asset is assessed at each reporting date to determine whether there is any objective evidence that it is impaired. A financial 
asset is considered to be impaired if objective evidence indicates that one or more events have had a negative effect on the estimated 
future cash flows of that asset. All impairment losses are recognised in profit or loss. An impairment loss is reversed if the reversal can 
be related objectively to an event occurring after the impairment loss was recognised.
Non-financial assets
The carrying amounts of the Group’s non-financial assets are reviewed at each reporting date to determine whether there is any 
indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated.
For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from 
continuing use that are largely independent of the cash inflows of other assets or groups of assets (the “cash-generating unit”).The 
recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing 
value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current 
market assessments of the time value of money and the risks specific to the asset. 
An impairment loss is recognised if the carrying amount of an asset or its cash-generating unit exceeds its estimated recoverable 
amount. Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of cash-generating units are 
allocated first to reduce the carrying amount of any goodwill allocated to the units and then to reduce the carrying amount of the other 
assets in the unit (group of units) on a pro rata basis.
32  Notes to the Consolidated Financial Statements  Annual Report & Accounts 20099
Notes to the Consolidated Financial Statements (continued) 1. Accounting policies (continued)
Income tax
Income tax comprises current and deferred tax. Income tax is recognised in the Income Statement except to the extent that it relates to 
items recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the 
balance sheet date, and any adjustment to tax payable in respect of previous years.
Deferred taxation is recognised throughout the Group using the balance sheet liability method, providing for temporary differences 
between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. The 
amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and 
liabilities, using tax rates enacted or substantively enacted at the balance sheet date.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset 
can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
Post retirement benefits
The Group operates both defined contribution and defined benefit post retirement benefit plans.
Defined contribution plans
A defined contribution plan is a post retirement benefit plan under which the Company pays fixed contributions into a separate entity 
and has no legal or constructive obligation to pay further amounts. Contributions are recognised in the Income Statement when they 
fall due.
Defined benefit plans
A defined benefit plan provides post retirement benefits based on final pensionable pay. The Group’s net obligation in respect of 
defined benefit pension plans is calculated separately for each plan by estimating the amount of future benefit that employees 
have earned in return for their service in the current and prior periods; that benefit is discounted to determine its present value. Any 
unrecognised past service costs and the fair value of any plan assets are deducted. The discount rate is the yield at the reporting date 
on AA credit-rated bonds that have maturity dates approximating the terms of the Group’s obligations and that are denominated in the 
same currency in which the benefits are expected to be paid. The calculation is performed annually by a qualified actuary using the 
projected unit credit method.
The Group recognises all actuarial gains and losses arising from defined benefit plans directly in equity immediately.
The pension scheme deficits are recognised in full. The movement in the scheme deficit is split between operating charges, finance 
items and, in the statement of consolidated income, actuarial gains and losses. 
Operating lease payments
Payments made under operating leases are recognised in the Income Statement on a straight-line basis over the term of the lease.
Employee share schemes
The share option programme allows employees to acquire shares of the Company. The fair value of options granted is recognised as 
an employee expense with a corresponding increase in equity. The fair value is measured at the grant date and spread over the period 
during which the employees become unconditionally entitled to the options. The fair value of the options granted is measured using a 
Black-Scholes model, taking into account the terms and conditions upon which the share options were granted.
The amount recognised as an expense is adjusted to reflect the actual number of share options that vest except where variations are 
due only to share prices not achieving the threshold for vesting.
Trade and other receivables
Trade and other receivables are stated initially at their fair value and subsequently at amortised cost using an effective interest rate less 
impairment losses. The fair value of trade and other receivables is estimated as the present value of future cash flows. A provision for 
impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due 
according to the original terms of the receivables. The amount of provision is recognised in the Income Statement.
Trade and other payables
The fair value of trade and other payables is estimated as the present value of future cash flows.
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  33 1. Accounting policies (continued)
Provisions
Provisions are recognised where a legal or constructive obligation has been incurred which will probably lead to an outflow of resources 
that can be reasonably estimated. Provisions are recorded for the estimated ultimate liability that is expected to arise, taking into 
account foreign currency effects arising from their translation from their functional currency into Sterling and the time value of money, 
where material.
Government grants
Government grants are not recognised until there is reasonable assurance that the Group will comply with the conditions attaching to 
them and that the grants will be received.
Government grants relating to property, plant and equipment are treated as deferred income and released to profit or loss over the 
expected useful lives of the assets concerned. Where grants have been received and conditions relating to receipt of the grants are not 
wholly fulfilled then these grants are held on the balance sheet until such time as the position is agreed with the grant provider.
Accounting estimates and judgments
The Board considered the relevance, selection, implications and disclosure of the Group’s critical accounting policies and estimates and 
the application of these policies and estimates. The key sources of estimation uncertainty were as follows:
Employee retirement benefit scheme – defined benefit plans
The determination of the Group’s obligations and expense for defined benefit pensions is dependent on the selection, by the Board of 
Directors, of assumptions used by the pension scheme actuary in calculating these amounts. The assumptions applied are described 
in note 20 and include, amongst others: discount rate; expected return on plan assets; rates of increase in salaries; and mortality rates. 
While the Directors consider that the assumptions are appropriate, significant differences in the actual experience, particularly in the 
volatile bond markets, or significant changes in assumptions may materially affect the amount of the Group’s future pension obligations, 
actuarial gains and losses included in the Statement of Recognised Income and Expense and employee costs recognised in the Income 
Statement.
Impairment
Both financial and non-financial assets are assessed at each reporting date to determine whether there is any objective evidence of 
impairment. If so, then the recoverable amount of the asset is estimated and a charge made to the Income Statement. This requires a 
significant degree of judgment, both in estimating the fair value of the asset, were it to be sold on the open market, and in estimating the 
present value of future cash flows generated from its continued use.
Inventories
Inventories are stated at the lower of cost and net realisable value. Some items included in inventories are written down to their net 
realisable value based on assumptions about future demand and market conditions. If actual market conditions are less favourable than 
those projected by management, then inventory may be required to be written down by additional amounts.
Environmental provisions
The Group has provisions for environmental remediation costs which have arisen from its dyeing operations in the UK and the USA. 
In each case a remediation programme has been agreed with the relevant environmental agency. The principal method of remediation 
is extraction of contaminated ground water which is cleaned and returned. Future remediation expenses are affected by a number of 
uncertainties that include, but are not limited to the volume of remaining contaminant, the length of time required to complete extraction 
and escalation of costs during that period. Management believe that total environmental provisions are adequate based upon currently 
available information.
34  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued) 2. Segmental analysis
The Group has adopted IFRS 8, operating segments with effect from 4 January 2009. As described in note 1 – basis of preparation and 
significant accounting policies segmental analysis has been aligned with internal reporting to the ‘Chief Operating Decision Maker’ which 
is considered to be the Board of Directors.
In the previous year the UK and US Knitwear segments were combined and reported under ‘Knitwear’ and the Home Furnishings 
Private Label and Branded segments were combined and reported under ‘Home Furnishings’. The Spinning division comprising the 
Todd & Duncan business has been treated as a discontinued operation following its sale during 2009.
Under IFRS 8 the operating segments have been identified as the following:
UK Knitwear
This segment comprises the Barrie business which manufactures cashmere and woollen garments which are sold mainly in the 
European market. It sells both to private label customers and under its own labels which include Barrie, John Laing and Glenmac.
US Knitwear
This segment comprises the Forte business which sources cashmere garments from China which are sold in the American market, 
primarily to large private label customers. It also sells to smaller boutique customers under its own ‘Kinross’ label. This business is highly 
seasonal, making over 90 per cent of its sales and all of its profit in the second half of the year.
Home Furnishings Private Label
This segment designs and sources bed linen, primarily from Asia, which is sold to Private Label customers.
Home Furnishings Branded
This segment designed and sourced ‘Dorma’ branded bed linen which it retailed through a number of channels. Following the sale of 
the ‘Dorma’ brand to Dunelm Group in July 2008 a phased exit from this business is being conducted which will complete by mid 2010. 
Certain establishment costs, currently charged to the Branded segment will then transfer to the Private Label segment.
 
 Revenue Profit (loss)
 2009 2008 2009 2008
 £000 £000 £000 £000
UK Knitwear 7,896 10,032 1,133 1,507
US Knitwear 28,695 34,023 3,774 3,588
Home Furnishings Private Label 24,795 21,766 (117) 2,862
Home Furnishings Branded 11,497 19,892 (1,365) (2,422)
Segmental revenues/operating profit before exceptional items 72,883 85,713 3,425 5,535 
and central costs
Unallocated central costs
– foreign exchange gain (loss)   209 (1,460)
– other administrative costs     (2,228) (3,558)
Operating profit before exceptional items   1,406 517
Exceptional items   556 1,342
Operating profit after exceptional items   1,962 1,859
Net finance charges   (1,387) (739)
Profit before tax for continuing operations   575 1,120
Net Finance charges are not allocated across segments as borrowing requirements are managed on a Group wide basis. The results of 
the discontinued operations are disclosed in note 5.
Included in revenues arising from the Home Furnishings Private Label segment are revenues of approximately £18,206,000 
(2008: £14,494,000) which arose from the Group’s largest customer.
Included in revenues arising from the US Knitwear segment are revenues of approximately £9,657,000 (2008: £12,839,000) which 
arose from the Group’s second largest customer.
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  35 2. Segmental analysis (continued) Assets
 2009 2008 2007
 £000 £000 £000
UK Knitwear 2,267 1,698 1,842
US Knitwear 3,052 2,526 2,952
Home Furnishings Private Label 8,313 7,450 8,779
Home Furnishings Branded 3,818 7,120 10,071
Segmental assets 17,450 18,794 23,644
Unallocated central assets 628 3,295 425
Deferred tax 1,750 1,500 1,500
Cash and deposits 12,343 9,900 6,093
Total assets, continuing operations 32,171 33,489 31,662
Total assets, discontinued operations 649 19,390 20,002
Total assets 32,820 52,879 51,664
Geographical information
The Group’s revenue from external customers by geographical location is detailed below. Geographical information about the assets of 
the Group’s only non UK business segment ‘US Knitwear’ is detailed above.
 2009 2008
Revenue from external customers £000 £000
United Kingdom 37,480 42,262
USA 29,072 35,210
France 5,011 6,422
Other European Countries 1,186 1,708
Middle East and Asia 81 61
Rest of the world 53 50
 72,883 85,713 
36  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued)  Continuing Operations Discontinued Operations Total
 2009 2008 2009 2008 2009 2008
3. Operating Profit £000 £000 £000 £000 £000 £000
Operating profit is stated after charging (crediting):
Cost of inventories recognised as an expense 53,318 58,092 13,470 18,052 66,788 76,144
Staff costs (note 6) 10,485 13,057 2,849 4,347 13,334 17,404
Net foreign exchange (gains) losses (405) 1,001 (270) (222) (675) 779
Depreciation of property, plant and equipment
– base 167 428 244 376 411 804
– impairment charge – 475 – 1,000 – 1,475
Amortisation of computer software
– base 47 33 – – 47 33
– impairment charge – 324 – – – 324
(Gain) loss on disposal of property, plant and equipment (5) – 4 – (1) –
Decrease in inventory net realisable value provision – (438) – – – (438)
Impairment (gains) losses recognised on 
trade receivables (note 14) (295) 346 536 276 241 622
Operating lease rentals
– plant and machinery 61 5 3 5 64 10
– other 510 759 – – 510 759
Government grants towards
– training costs 4 8 – – 4 8
– market research costs 8 7 – – 8 7
– efficiency projects 4 – – – 4 –
Auditors’ remuneration (as analysed below) 167 – 14 – 181 –
Previous auditors’ remuneration (as analysed below) 28 440 – 18 28 458
Auditors’ remuneration:
Audit of these financial statements 66 – – – 66 –
Audit fees for subsidiaries pursuant to legislation 26 – 14 – 40 –
Total audit fees 92 – 14 – 106 –
Valuation and actuarial services 31 – – – 31 –
Other services relating to taxation 44 – – – 44 –
Total non-audit fees 75 – – – 75 –
Previous auditors’ remuneration:
Audit of these financial statements – 102 – – – 102
Audit fees for subsidiaries pursuant to legislation – 50 – 18 – 68
Total audit fees – 152 – 18 – 170
Other services pursuant to such legislation 5 15 – – 5 15
Valuation and actuarial services (4) 82 – – (4) 82
Other services relating to taxation 27 191 – – 27 191
Total non-audit fees 28 288 – – 28 288
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  37  2009 2008
4. Exceptional items – continuing operations £000 £000
Reorganisation costs
(i)
– UK Knitwear  (125) –
– Home Furnishings Branded – (175)
King Deer debt proceeds
(ii)
 973 –
Property costs
(iii)
 (292) – 
Gain on sale of Dorma brand
(iv)
 – 1,517
 556 1,342 
(i) Reorganisation costs arise from the restructuring of the operating divisions and comprise redundancy costs, fixed asset write offs 
and associated fees.
(ii) During the year the Company received repayment of $1.5 million against a long outstanding debt due from Inner Mongolia 
King Deer Cashmere Company Limited. The original debt was approximately $10 million and has been fully provided against in 
the financial statements. Given the age of the debt, the Company considers it appropriate to retain a full provision against the 
outstanding balance.
(iii) The Company is currently negotiating the early exit from a leasehold property and has made a full provision against the 
anticipated cost.
(iv) On 29 July 2008 the Company announced the sale of the Dorma trademark and associated rights to Dunelm Group plc for a cash 
consideration of £5 million and noted that it would incur costs of exiting its Dorma Branded business by January 2011. Costs 
estimated to be £3.5 million were provided, comprising £2.7 million cash costs and £0.8 million fixed asset impairment.
5. Discontinued operations
On 28 August 2009 the Company completed the sale of the business, fixed assets and stocks of the Todd & Duncan yarn spinning 
division to Ningxia Zhongyin Cashmere Company Limited (“Zhongyin”). The consideration was based on the value of fixed assets and 
stocks at completion less a discount of £4.2 million. The Company incurred costs of £946,000 in respect of the disposal. The results of 
discontinued operations are as follows:
 2009 2008
 £000 £000
Revenue 14,625 21,514 
Cost of sales (13,201) (18,052)
Gross margin 1,424 3,462 
Operating expenses (2,351) (2,960)
(Loss) profit before exceptional items (927) 502 
Fixed asset impairment – (1,000)
Loss on disposal of business (5,200) –
Loss for the period from discontinued operations (6,127) (498)
38  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued) 5. Discontinued operations (continued)
As part of the sale two supply agreements have been entered into. Barrie, which currently sources some of its cashmere yarn from 
Todd & Duncan, has signed a four year supply agreement at arms length to source yarn from Todd & Duncan Limited at similar levels. 
Dawson Forte, which sources some its cashmere garments from Zhongyin, has signed a four year agreement to offer a minimum level 
of garment orders to Zhongyin.
The assets of the Todd & Duncan business which formed part of the sale agreement at the date of disposal were as follows:
 £000
Property, plant and equipment 1,304
Inventories 8,890
 10,194
Trade and other receivables 1,865
Trade and other payables (1,487)
 10,572
Discount to net assets (4,200)
Total consideration 6,372
Costs of disposal (946)
Net proceeds 5,426
Satisfied by:
Cash and cash equivalents 5,426
All monies arising on the sale of the business were settled by the year end.
The impact of Todd & Duncan on the Group’s results in the current and prior periods is disclosed above.
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  39 40  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued)
6. Employees
 2009 2008
Average number of persons employed Number Number
Production 297 317
Distribution 256 476
Administration 70 80
 623 873
Aggregate employment costs £000 £000
Wages and salaries 11,945 15,649
Social security costs 899 1,183
Share based payment expense (note 21) 47 85
Pension costs – Defined Benefit (note 20) 195 321
Pension costs – Defined Contribution (note 20) 248 166
 13,334 17,404
Details of the remuneration of the Directors are contained in the Directors’ Report on Remuneration on pages 21 to 23.
 2009 2008
7. Finance income/(costs) £000 £000
Interest receivable on short-term deposits 15 65
Finance income 15 65
Interest payable on bank loans and overdrafts (513) (930)
Finance costs (513) (930) Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  41
 2009 2008
8. Income tax expense £000 £000
(a) Recognised in the Income Statement
 Current tax expense
 Current year 462 146
 Adjustments in respect of prior years 79 –
 Total current tax 541 146
 Deferred tax expense
 Origination and reversal of timing differences (250) –
 Total income tax expense in Income Statement 291 146
(b) Current and deferred tax recognised directly in equity
 There was no current or deferred tax charged or credited to any item recognised directly in equity.
  2009 2009 2008 2008
(c) Reconciliation of effective tax rate % £000 % £000
 Profit on ordinary activities before tax from continuing operations  575  1,120
 Income tax using the UK corporation tax rate of 28.0% (2008: 28.5%) 28.0% 161 28.5% 319
 Effects of:
 Non-deductible expenditure 6% 34 6% 68
 Differences in effective overseas tax rates 25% 146 13% 146
 Movement in deferred tax items not recognised 8% 47 23% 260
 Depreciation in excess of capital allowances 22% 128 21% 238
 Movement in deferred tax items recognised -43% (250) – –
 Adjustment in respect of prior periods 14% 79 – –
 Tax losses utilised -9% (54) -79% (885)
  51% 291 13% 146
(d) Factors that may affect future tax charges
 As detailed in note 12 there are significant unrecognised deferred tax assets in both the UK and USA for which no benefit has been 
recognised because it is not possible to say with reasonable assurance that sufficient future taxable profit will be available against 
which the Group can utilise the benefit thereon.  2009 2008
9. Earnings per share pence pence
Basic and diluted (loss)/earnings per share
Continuing operations 0.1 0.4
Discontinued operations (2.7) (0.2)
Total basic and diluted (loss)/earnings per share (2.6) 0.2
Adjusted loss per share
Basic and diluted earnings per share from continuing operations 0.1 0.4
Adjustments:
Reorganisation costs 0.1 0.1
King Deer debt proceeds (0.4) –
Property costs 0.1 –
Gain on sale of Dorma brand – (0.7)
Adjusted loss per share (0.1) (0.2)
 000s 000s
Weighted average number of shares
Basic weighted average shares in issue during the period 225,158 225,158
Dilutive potential ordinary shares – –
 225,158 225,158
Total basic (loss) earnings per share is calculated on the loss for the financial period of £5.9 million (2008: £0.5 million profit) and the 
weighted average number of shares during the period calculated in accordance with International Accounting Standard 33.
Diluted earnings (loss) per share adjusts for share options granted to employees where the exercise price is less than the average price 
of the Company’s shares during the period and when their exercise would reduce earnings per share or increase loss per share.
Adjusted earnings (loss) per share is stated in order to give a comparable measure before exceptional items. 
42  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued)  2009 2008
10. Intangible fixed assets – Computer software costs £000 £000
Cost
At beginning of period 1,925 1,923
Additions 59 2
Disposals (1,354) –
At end of period 630 1,925
Depreciation and impairment
At beginning of period 1,794 1,437
Charge for the period 47 33
Impairment charge – 324
Disposals (1,354) –
At end of period 487 1,794
Net book value
At beginning of period 131 486
At end of period 143 131
In 2008 an impairment charge of £324,000 was charged by the Home Furnishings division as a consequence of the decision to exit the 
Dorma Branded business.
 Land and  Plant and 2009 Land and Plant and 2008
 buildings machinery Total buildings machinery Total
11. Property, plant and equipment £000 £000 £000 £000 £000 £000
Cost
At beginning of period 1,289 17,006 18,295 1,168 19,189 20,357
Additions – 364 364 – 525 525
Disposals (61) (11,919) (11,980) – (2,902) (2,902)
Translation adjustments (43) (73) (116) 121 194 315
At end of period 1,185 5,378 6,563 1,289 17,006 18,295
Depreciation and impairment
At beginning of period 1,118 14,892 16,010 1,034 15,283 16,317
Charge for the period 40 371 411 – 804 804
Impairment charge – – – – 1,475 1,475
Disposals (61) (10,615) (10,676) – (2,846) (2,846)
Translation adjustments (41) (66) (107) 84 176 260
At end of period 1,056 4,582 5,638 1,118 14,892 16,010
Net book value
At beginning of period 171 2,114 2,285 134 3,906 4,040
At end of period 129 796 925 171 2,114 2,285
In 2008 an impairment charge of £1,000,000 was charged by the Spinning division following the annual impairment review conducted in 
accordance with IAS 36.
In 2008 an impairment charge of £475,000 was charged by the Home Furnishings division as a consequence of the decision to exit the 
Dorma Branded business.
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  43  2009 2008
12. Deferred tax asset £000 £000
Temporary differences on property, plant and equipment 8,632 8,323
Other timing differences 5,733 3,044
Tax losses available to carry forward 21,645 20,306
Total deferred tax asset 36,010 31,673
Deferred tax asset not recognised
– UK (33,074) (28,615)
– USA (1,186) (1,558)
Deferred tax asset recognised 1,750 1,500
The deferred tax asset in the USA is subject to the provisions of s.382 of the Inland Revenue Service code which limits the amount of 
brought forward losses which can be offset against future taxable profits in the event of a 50 per cent change in the shareholder base of 
the parent company in any three year period.
A deferred tax asset has been recognised on the basis of the projected profitability of the Dawson Forte business in the USA and the 
continuing access to net operating losses previously generated.
 2009 2008
13. Inventories £000 £000
Raw materials 72 3,235
Work in progress 86 1,759
Finished goods 8,151 19,096
 8,309 24,090
Inventories with a carrying amount of £ nil (2008: £5,114,000) have been pledged as security for certain of the Group’s borrowings.
44  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued)   2009 2008
14. Trade and other receivables £000 £000
Due within one year
Amounts receivable for the sale of goods 10,064 13,783
Allowance for doubtful debts (1,557) (1,709)
Net trade receivables 8,507 12,074
Other debtors 471 2,238
Prepayments and accrued income 372 661
 9,350 14,973
Trade receivables with an approximate carrying amount of £ nil (2008: £2,549,000) have been pledged as security for certain of the 
Group’s borrowings.
Of the trade receivables balances at the end of the year £2,055,000 (2008: £1,559,000) is due from Dunelm Group plc, the Group’s 
largest customer. There are no other customers who represent more than 10% of the total balance of trade receivables.
At the end of each period the Group carries out a detailed review of the recoverability of debts and makes provision on a specific basis 
in respect of any debts considered doubtful.
  2009 2008
 Movement in the allowance for doubtful debts £000 £000
Balance at the beginning of the period 1,709 1,173
Impairment losses recognised in period 640 826
Impairment losses from prior periods reversed in current period (359) (297)
Amounts written off during the year as uncollectable (393) (86)
Translation adjustments (40) 93
Balance at end of period 1,557 1,709
  2009 2008
 Age profile of trade receivables not impaired £000 £000
Fully performing 5,748 9,059
0-30 days overdue 1,942 2,304
30-60 days overdue 403 320
60-90 days overdue 18 110
90 days + overdue 396 281
 8,507 12,074
The Directors consider that the carrying amount of trade and other receivables is approximately equal to their fair value.
The impaired receivables balance of £1,557,000 (2008: £1,709,000) all fall into the over 90 days overdue category.
The Company had a long standing debt of approximately $10 million due from Inner Mongolia King Deer Cashmere Company Limited 
that had been fully provided in previous years. During the year $1.5 million was received in accordance with a payment plan. The 
Company considers it inappropriate to recognise this debt at present as previous payment plans have been defaulted.
Further information on credit risk management is detailed in note 18.
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  45   2009 2008
15. Cash and cash equivalents £000 £000
Bank current account balances 11,931 9,500
Bank deposit
(i)
 412 400
 12,343 9,900
(i) The bank deposit collateralises a duty deferment scheme guarantee given by Bank of Scotland.
The Group’s exposure to interest rate risk and sensitivity analysis for financial assets and liabilities are disclosed in note 18.
  2009 2008
16. Trade and other payables £000 £000
Trade payables 5,912 9,897
Other payables 282 666
Other taxation and social security costs 478 700
Accruals and deferred income 2,807 4,313
 9,479 15,576
  2009 2008
17. Borrowings £000 £000
Gmac Commercial Finance
Sterling – 4,155
Euro – 12
US Dollar – 45
 – 4,212
UK operations are funded by two working capital facilities from Gmac Commercial Finance Limited. The maximum amount which may 
be drawn under these facilities at the year end is £21.1 million however the amount which may be drawn is restricted by, and varies 
according to the working capital employed by the UK businesses. The facility has subsequently been reduced to £10.0 million reflecting 
the Group’s reduced facility requirements following the sale of the Todd & Duncan business.
The facility is secured against the assets of the UK operations and by cross guarantees. Funding is provided against eligible trade 
receivable balances and certain inventory categories subject to agreed limits. Interest rates applied to advances made against trade 
receivables is base rate +2.25% and for advances against inventory is base rate +3.5%.
The US operation is funded by a working capital facility from Bank of America. The maximum amount which may be drawn under this 
facility is $25 million however the amount which may be drawn is restricted by, and varies according to the working capital employed 
by the US business. The facility is secured against the assets of the US operation. Interest rates applied to both trade receivables and 
inventory is the greater of the Bank of America prime rate and the London Interbank Offered Rate (LIBOR) +2.0%.
Further details are given in note 18, Financial Instruments.
18. Financial instruments
Financial instruments arise from funding activities, principally cash retained within the business and borrowings, and from operating 
activities, principally trade receivables and trade payables, where there is a contractual obligation to receive or to deliver cash.
Cash and cash equivalents and trade and other receivables have been classified as loans and receivables, trade and other payables 
have been classified as financial liabilities, each measured at amortised cost. Derivative financial instruments arise when contracts are 
entered into which are based on an underlying rate or index, such as forward currency contracts, which may result in the receipt or 
delivery of cash at some future date depending on changes in that rate or index.
46  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued) 18. Financial instruments (continued) 
The policy of the Group is that financial instruments, including derivative financial instruments, will not be held for speculative purposes. 
Derivative financial instrument contracts are entered into solely for the purpose of mitigating the risk of adverse movements in the 
underlying rate or index as discussed below:
  2009 2008
 Analysis of financial instruments £000 £000
Financial assets
Cash and cash equivalents (note 15) 12,343 9,900
Net trade receivables (note 14) 8,507 12,074
 20,850 21,974
Financial liabilities
Borrowings (note 17) – 4,212
Trade payables (note 16) 5,912 9,897
Fair value of forward foreign exchange contracts 51 2,028
 5,963 16,137
During the year the Company entered into forward foreign exchange contracts to hedge some of its operational exposure to fluctuations 
in the US Dollar and Euro. The forward foreign currency contracts, in place as at 2 January 2010, have a maturity of between one month 
and thirteen months from the reporting date. The forward foreign exchange contracts did not meet the criteria for hedge accounting and 
as such the contracts are carried in the balance sheet as other financial liabilities at fair value at the reporting date with any change in fair 
value reported in the Income Statement in the year. At December 2009 this resulted in an unrealised exchange loss of £51,000 (2008: 
unrealised exchange loss £2,028,000).
The fair value of the Group’s financial assets and liabilities are not significantly different to their book values.
The main risks associated with financial instruments are liquidity risk, credit risk and market risk. Each of these is discussed below 
together with the policies adopted by the Board to mitigate them.
Liquidity risk
The Group is financed by working capital facilities in both the UK and the USA with Gmac Commercial Finance PLC (“Gmac”) and Bank 
of America. Both facilities fall due for renewal in 2010. Bank of America has advised the Company that it expects to renew the facility 
on existing or similar terms. Gmac has advised that it has taken a strategic decision to exit the UK market and will be terminating all 
client facilities as they fall due for renewal. The Company currently has no borrowings from Gmac and does not project a borrowing 
requirement. From this position, we expect to secure an alternative funding facility during the course of the year.
Details of the Group borrowing facilities are given in note 17.
The two Gmac facilities operate on a pooled basis, supported by cross guarantees between each business. The US business normally 
remits its profit after tax to the UK, either by dividend or by loan, following the year end audit of results. Agreement exists with Bank of 
America to remit up to 100% of profit after tax in two equal amounts, the first after the draft financial statements have been received and 
the second in September.
The Board reviews liquidity as part of the budget approval process and subsequent quarterly forecast updates for the year. Performance 
against these forecasts is monitored by means of a weekly rolling twelve week cashflow forecast.
All trade payables are expected to be paid in line with the standard terms offered by the Group’s suppliers. These can vary from pro 
forma payment to 90 days depending on the nature of the goods being purchased and the supplier.
Credit risk
The credit rating of the Group’s customers has a direct bearing on its ability to borrow funds. The Group’s policy is therefore normally 
only to accept business from customers which have a satisfactory credit rating and to mitigate the risk of default with trade credit 
insurance where possible.
The average credit period taken on sales of goods is 40 days (2008 – 44 days).
The Group closely monitors balances and makes provision for doubtful debts as appropriate. Trade receivables disclosed in note 14 
include amounts which are past due at the reporting date but against which the Group has not recognised an allowance for doubtful 
receivables because there has not been a significant change in credit quality and the amounts are still considered recoverable.
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  47 18. Financial instruments (continued)
Market risk
Market risk is the risk that changes in market prices, such as raw material prices, foreign exchange rates and interest rates will affect the 
Group’s income or the values of any financial instruments held.
(i) Raw material prices
A significant element of cost of sales for the Knitwear Divisions is cashmere fibre which is of finite and variable supply causing 
volatility in price which can be difficult to pass on to customers.
(ii) Currency
For businesses based in the UK, which have Sterling as their functional currency, a significant proportion of cost of sales is in US 
Dollars and a significant proportion of sales in Euros. To the extent that purchases are from China, there is an indirect exposure to 
the Remnimbi exchange rate which potentially impacts US Dollar prices. The Board regularly reviews the exposure to US Dollar 
payments and Euro receipts and can offset the risk of currency fluctuation by means of forward foreign exchange contracts.
For the US business, which has US Dollars as its functional currency, all purchases and sales are US Dollar denominated but again 
there is an indirect exposure to the Remnimbi exchange rate which is not offset by use of financial instruments. The currency risk 
arising on translation of the US business’s net assets is not offset by any financial instrument.
 2009 2009 2008 2008
Principal exchange rates: Average Year end Average Year end
Euro 1.124 1.126 1.255 1.040
US Dollar 1.568 1.615 1.848 1.450
Currency profile of financial assets and financial liabilities:     2009
 Sterling Euro US Dollar US Dollar
(i)
 Other Total
 £000 £000 £000 £000 £000 £000
Trade receivables 4,690 1,765 60 1,992 – 8,507
Cash and cash equivalents 3,206 1,460 539 7,126 12 12,343
Trade payables (2,639) (228) (1,817) (1,228) – (5,912)
Other financial liabilities – (51) – – – (51)
 5,257 2,946 (1,218) 7,890 12 14,887
      2008
 Sterling Euro US Dollar US Dollar
(i)
 Other Total
 £000 £000 £000 £000 £000 £000
Trade receivables 5,377 4,028 1,221 1,448 – 12,074
Cash and cash equivalents 1,054 418 215 8,174 39 9,900
Trade payables (3,075) (286) (6,429) (107) – (9,897)
Other financial liabilities – (2,338) 310 – – (2,028)
Borrowings (4,155) (12) (45) – – (4,212)
 (799) 1,810 (4,728) 9,515 39 5,837
(i) US Dollar financial assets and liabilities for US Dollar functional business reported separately.
48  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued) 18. Financial instruments (continued)
Market risk (continued)
(iii) Interest rates
The Group borrows only at floating rates of interest and does not seek to offset this exposure by use of financial instruments.
Finance income and expense recognised in the Income Statement is analysed in note 7.
There is no finance income or expense recognised directly in equity, except for the foreign currency translation difference arising on 
the consolidation of foreign operations, which is included in the translation reserve.
(iv) Sensitivity analysis
The following sensitivity analysis estimates the impact of adverse movements in raw material prices, foreign currency exchange 
rates and interest rates. Each sensitivity assumes all other factors hold constant and that no derivative financial instruments are 
employed.
   2009 2008
Sensitivity analysis Basis £000 £000
Raw material price (i) Cashmere fibre prices increase 10%
  Knitwear division cost of sales (1,178) (1,483)
Foreign currency rates (i) USD strengthens $0.05
  Sterling functional businesses cost of sales (461) (850)
  Sterling functional business sales 8 44
  USD functional business Sterling reported profits 113 91
   (340) (715)
 (ii) Euro weakens €0.05
  Estimated impact on Sterling functional business sales (274) (787)
Average net borrowings (i) Interest rates increase by 1%
  Average net funds of £2.1 million (2008: borrowings £4.9 million) 21 (49)
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  49       Other
   Opening Charged Utilised movements Closing
19. Provisions  £000 £000 £000 £000 £000
Reorganisation costs (i) 2,508 26 (1,729) (14) 791
Customer claims (ii) 317 25 (42) – 300
Environmental cleanup costs (iii) 1,046 – (180) (56) 810
Post retirement benefits (iv) 80 – (7) – 73
Onerous lease (v) – 192 – – 192
  3,951 243 (1,958) (70) 2,166
(i) The provision for reorganisation costs relates mainly to the exit from the Home Furnishings Branded business. It is expected that 
this will be completed by mid 2010.
(ii) Provision exists at the end of year for the return of knitwear garments from customers. At the end of 2009 there was a reasonable 
expectation that significant costs in respect of re-work may be incurred over the course of the next 12 – 24 months.
(iii) Provision has been made for environmental remediation costs which have arisen from previously owned dyeing operations in the 
UK and USA. In each case a long-term remediation programme has been agreed with the relevant environmental agency. The latest 
estimate available indicates that the UK remediation programme will run until 2024 and the US programme until 2019.
(iv) Provision has been made for certain post retirement benefits which are not provided by either the Group’s defined benefit or defined 
contribution schemes. The provision allows for pension benefits to be payable until 2020 at the current payment levels.
(v) A provision has been made for the cost of early termination of the lease on a vacant property.
 2009 2008
 Current Non current Current Non current
Analysis of current and non current provisions £000 £000 £000 £000
Reorganisation costs 791 – 1,717 791
Customer claims 150 150 17 300
Environmental cleanup costs 180 630 236 810
Post retirement benefits 7 66 7 73
Onerous lease 16 176 – –
 1,144 1,022 1,977 1,974
50  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued) 20. Retirement benefits schemes
The Group operates a number of pension schemes, the assets of which are held independently from the Group. The assets of the UK 
defined benefit plans are held in trustee administered funds.
The principal plans are:
•	 T wo	defined	benefit	plans	in	the	UK	which	ar e	closed	to	new	members.
•	 A	defined	benefit	plan	in	the	USA	which	is	closed	to	all	members.
•	 A	defined	contribution	scheme	in	the	UK.
•	 A	401K	plan	in	the	USA.
Defined contribution plans
The Group operates a defined contribution pension plan in the UK and a 401K plan in the USA. The pension costs charge for the period 
represents contributions payable by the Group to the schemes which amounted to £147,000 (2008: £166,000) for the UK scheme and 
$159,000 (2008: $127,000) for the USA scheme. Employer contributions unpaid at year end were £2,000 (2008: £4,000).
Defined benefit plans
In the UK full actuarial valuations are made triennially by an independent, professionally qualified actuary using the projected unit 
method. Between valuations the actuary performs regular funding updates which reassess the funding position of the plans. In the USA, 
full actuarial valuations are made annually by an independent, professionally qualified actuary using the projected unit method. Based 
on these, together with any other significant factors affecting the profile of the plans, the actuaries recommend variations to the funding 
rates to be applied in the year. As the plans are closed to new members it is likely that the current service cost will increase as the 
members of the plan approach retirement.
Profiles of the defined benefit plans are as follows:
Membership as at 2 January 2010 Staff Works UK Total USA
Active 32 41 73 –
Deferred 564 1,320 1,884 128
Retired 825 681 1,506 852
 1,421 2,042 3,463 980
  Staff Works UK Total USA
  5 Apr 06 5 Apr 06 5 Apr 06 31 Dec 09
Summary of last full actuarial valuations £000 £000 £000 £000
Market value of assets 78,898 22,241 101,139 4,620
Deficit – Ongoing basis (10,299) (6,923) (17,222) n/a
 – IAS 19 (10,226) (7,906) (18,132) n/a
 – s.179 basis (3,444) (11,084) (14,528) n/a
A full actuarial valuation of the UK schemes was undertaken as at 5 April 2009. This valuation has not yet been finalised. Negotiations 
are currently underway with the Pension Trustees and it is anticipated that these will be completed in the near future. The negotiations 
will result in a revised funding schedule designed to eliminate the current deficit over the agreed period. As the valuation is not finalised 
actuarial calculations for the year end financial statements have been based on the 2006 valuation.
The Group has provisionally agreed with the Pension Trustees to set aside £1.8 million from the disposal of the Todd & Duncan business 
which is to be used to fund initiatives to help reduce the pension deficit.
 UK Total USA
Contributions paid in the year £000 £000
Employer 563 255
Employees 113 –
 676 255
The estimated value of ongoing contributions expected to be paid to the schemes during 2010 is £554,000. Employer contributions 
unpaid at year end were £40,000 (2008: £52,000).
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  51 20. Retirement benefit schemes (continued)
 UK schemes USA
 Staff Works Closed scheme
Principal assumptions 2009 2008 2009 2008 2009 2008
Discounted rate for liabilities 5.80% 6.50% 5.80% 6.50% 5.75% 5.50%
Weighted average expected return 
on scheme assets
(i)
 7.40% 5.85% 7.80% 6.10% 8.00% 5.00%
Salary growth 2.50% 2.40% 3.60% 2.75% n/a n/a
Pension increases 3.60% 3.15% 3.60% 3.15% n/a n/a
Retail price inflation 3.40% 2.55% 3.40% 2.55% n/a n/a
Life expectancy beyond normal 
retirement date (years)
– Male 22.3 20.7 21.0 20.7 20.7 20.7
– Female 25.0 23.6 23.4 23.6 23.6 23.6
(i) The UK plans are invested in a Total Investment Governance Solution (TIGS). An analysis of the return on scheme assets by class of 
asset would not be meaningful due to the dynamic nature of the underlying investments. The expected return has been set based 
on the yield of fixed-interest government bonds, plus an allowance for expected outperformance on the return seeking element of 
the asset portfolio.
Analysis of balance sheet deficit 2009   2008
 UK USA Total UK USA Total
 £000 £000 £000 £000 £000 £000
Equities 21,272 4,579 25,851 23,125 1,883 25,008
Bonds 55,757 – 55,757 48,857 1,883 50,740
Other
(i)
 23,125 41 23,166 21,702 942 22,644
Total market value of assets 100,154 4,620 104,774 93,684 4,708 98,392
Actuarial value of liabilities (117,921) (6,099) (124,020) (98,204) (6,918) (105,122)
Net liability before deferred tax (17,767) (1,479) (19,246) (4,520) (2,210) (6,730)
No deferred tax asset has been recognised on the basis that the Group has yet to demonstrate a sufficient future income stream to 
utilise that asset.
(i) Other includes cash balances and property.
 Pension Plans Deficit
 Decrease Increase
Sensitivity of the balance sheet deficit to changes in the principal actuarial assumptions £000 £000
Corporate bond rates increase/(decrease) by 0.5% 8,701 (9,741)
Life expectancy reduces/(increases) by 1 year 3,569 (3,497)
Inflation reduces/(increases) by 0.25% 2,237 (2,613)
52  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued) 20. Retirement benefit schemes (continued)
 2009 2008
Movement in the fair value of the scheme assets £000 £000
Fair value of scheme assets at beginning of period 98,392 103,923
Expected return on scheme assets 5,692 6,627
Actuarial gain/(loss) recognised in equity 5,557 (9,661)
Contributions from employer 820 1,208
Contributions by members 111 146
Benefits paid (5,306) (5,214)
Exchange differences (492) 1,363
Fair value of scheme assets at end of period 104,774 98,392
 2009 2008
Movement in the liability for defined benefit obligations £000 £000
Liability for defined benefit obligations at beginning of period 105,122 108,624
Current service cost 195 321
Curtailment loss resulting from sale of Todd & Duncan 90 –
Interest costs 6,581 6,501
Actuarial loss (gain) recognised in equity 17,929 (7,128)
Contributions by members 111 146
Benefits paid (5,306) (5,214)
Exchange differences (702) 1,872
Liability for defined benefit obligations at end of period 124,020 105,122
 2009 2008
Expense recognised in the Income Statement £000 £000
Operating profit – administrative expenses
Current service cost (195) (321)
Curtailment loss resulting from sale of Todd & Duncan (90) –
 (285) (321)
Net finance (expense) income on pension assets/liabilities
Expected return on pension scheme assets 5,692 6,627
Interest on obligations (6,581) (6,501)
 (889) 126
 2009 2008
Actuarial losses recognised directly in equity £000 £000
Cumulative amount of actuarial gains at start of period 19,364 21,897
Recognised loss during the period (12,372) (2,533)
Cumulative amount of actuarial gains at end of period 6,992 19,364
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  53 20. Retirement benefit schemes (continued)
History of experience gains and losses recognised in the  2009 2008 2007 2006 2005
Statement of Comprehensive Income: £000 £000 £000 £000 £000
Fair value of scheme assets 104,774 98,392 103,923 103,546 103,947
Present value of defined benefit obligation (124,020) (105,122) (108,624) (123,296) (133,652)
Net retirement benefit obligation (19,246) (6,730) (4,701) (19,750) (29,705)
Experience adjustment on scheme assets 5,557 (9,661) 1,331 (2,453) 7,666
Percentage of scheme assets 5% -10% 1% -2% 7%
Experience adjustment on scheme liabilities 1,293 (1,447) 7,101 2,011 (8,007)
Percentage of scheme liabilities 1% -1% 7% 2% -6% 
21. Share-based payments
Employee share option scheme
The Group has an employee share option scheme which was established in 1996 and expired in 2006 whereby the Directors could 
grant options to eligible employees. Two types of option could be granted:
(i) Standard options, which are subject to the achievement of sustained improvement in the underlying financial performance of the 
Company as specified by the Directors at the date of grant. Standard options normally vest after three years, expire after ten years 
and lapse in the event of the participant leaving employment.
(ii) Super options, which are subject to the achievement of exceptional financial performance of the Company as specified by the 
Directors at the date of grant. Super options normally vest after five years, expire after ten years and lapse in the event of the 
participant leaving employment.
In each case the option price could be no less than the higher of the nominal value of a share and the middle market quotation of the 
dealing day last preceding the date of grant.
 2009 2008
  Weighted  Weighted
 Number of average Number of average
 share options exercise share options exercise
 000s price (p) 000s price (p)
Outstanding at the beginning of period 11,025 8.7 16,225 8.0
Lapsed (800) 7.6 (5,200) 6.3
Outstanding at the end of period 10,225 8.8 11,025 8.7
Exercisable at the end of period 7,175 8.8 1,300 14.2
For share options outstanding at 2 January 2010 the range of exercise prices and the average weighted remaining term to expiry were 
as follows:
 Number Term
 000s Years
Share option scheme
58.5p 100 1.2
10.5p 2,400 5.4
7.625p 7,725 6.3
 10,225 6.0
The fair value of options are calculated using the Black-Scholes model and are expensed to the Income Statement over the vesting 
period of the benefit. No options were granted or modified during the period. The amount expensed to the Income Statement in the 
period was £47,000 (2008: £85,000).
54  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued)  2009 2008
22. Share capital £000 £000
Authorised share capital
2,526,207,225 ordinary shares of 1 pence each 25,262 25,262
101,505,975 deferred shares of 49 pence each 49,738 49,738
50,000,000 preference shares of £1 each 50,000 50,000
75,000,000 preference shares of $1 each 46,000 46,000
 171,000 171,000
Issued equity share capital
Allotted, called up and fully paid:
225,158,542 ordinary shares of 1 pence each 2,251 2,251
101,505,975 deferred shares of 49 pence each 49,738 49,738
 51,989 51,989
  Share Translation Retained
  Premium Reserve Earnings Total
23. Reserves £000 £000 £000 £000
At 29 December 2007 5,489 (871) (36,084) (31,466)
Retained profit for the period – – 476 476
Actuarial loss on defined benefit pension schemes – – (2,533) (2,533)
Share-based payments – – 85 85
Translation adjustments – 1,689 – 1,689
At 3 January 2009 5,489 818 (38,056) (31,749)
Retained loss for the period – – (5,843) (5,843)
Actuarial loss on defined benefit pension schemes – – (12,373) (12,373)
Share-based payments – – 47 47
Translation adjustments – (578) 1 (577)
At 2 January 2010 5,489 240 (56,224) (50,495)
 2009 2008
24. Capital commitments £000 £000
Capital expenditure contracted 8 1
The commitments at 2 January 2010 relate to contracts to purchase property, plant and equipment and are expected to be settled 
in 2010.
Annual Report & Accounts 2009  Notes to the Consolidated Financial Statements  55 25. Contingent liabilities
As part of the conditions of the sale of Todd & Duncan the Company has guaranteed the lease commitments of the new business 
until August 2014. The maximum commitment under this guarantee is £917,000. No provision has been made as the Directors do not 
consider there is any probable loss.
 2009 2008
  Land and  Land and
  buildings Other buildings Other
26. Operating lease commitments £000 £000 £000 £000
Total non-cancellable operating lease rentals are payable as follows:
– within one year 493 22 593 41
– between two and five years 1,401 9 1,267 23
– after five years 810 – 1,088 –
 2,704 31 2,948 64
It is the Group policy to lease certain land and buildings and plant and equipment under operating leases. The average lease term for 
land and buildings is six years and for plant and equipment one year. All leases are on a fixed repayment basis and no arrangements 
have been entered into for contingent rental payments.
56  Notes to the Consolidated Financial Statements  Annual Report & Accounts 2009
Notes to the Consolidated Financial Statements (continued) Company Balance Sheet
As at 2 January 2010
  2009 2008
 Note £000 £000
Fixed assets
Investments in subsidiaries 2 22,395 32,826
  22,395 32,826
Current assets
Debtors due within one year 4 27,690 53,941
Cash and deposits  644 64
  28,334 54,005
Creditors: amounts falling due within one year
Other creditors 5 (38,299) (67,775)
Net current liabilities  (9,965) (13,770)
Net assets  12,430 19,056
Capital and reserves
Called up share capital 6 51,989 51,989
Share premium 7 5,489 5,489
Profit and loss account 7 (45,048) (38,422)
Equity shareholders’ funds  12,430 19,056
The financial statements of Dawson International PLC (registered number SC54505) were approved by the Board of Directors and 
authorised for issue on 9 March 2010. They were signed on its behalf by:
Andy Bartmess | Chief Executive
David Cooper | Finance Director
Annual Report & Accounts 2009  Company Balance Sheet  57 1. Accounting policies
Basis of preparation
The Company financial statements have been prepared under the historical cost convention and in accordance with the Companies Act 
2006 and applicable UK accounting standards (UK GAAP).
The financial statements have been prepared on the going concern basis. Details of the Board’s considerations and conclusions 
regarding the appropriateness of this basis are included on page 29 of the Group Financial Statements.
No profit or loss account is presented as permitted by section 408 of the Companies Act 2006. The Company reported a loss for the 
financial year of £6,673,000 (2008: £1,552,000 loss).
Under FRS 1 the Company is exempt from the requirement to prepare a cash flow statement on the grounds that Dawson International 
PLC has included a consolidated cash flow statement within the Group accounts.
The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the 
Group’s financial statements.
Fixed asset investments
Investments in subsidiaries are stated at cost less provisions for impairment.
Amounts receivable from subsidiary undertakings
Amounts receivable from subsidiary undertakings are recorded at cost. The ability of subsidiary undertakings to satisfy these obligations 
is kept under review and recognises that they may rely in turn on the settlement of inter-company balances owed by fellow subsidiary 
undertakings all of whom are under the control of the Company.
Amounts payable to subsidiary undertakings
Amounts payable to subsidiary undertakings are recorded at cost.
Share-based payments
The Company has issued equity settled share-based benefits to certain employees. The fair value of options granted is recognised as 
an employee expense with a corresponding increase in equity. The fair value is measured at the grant date and spread over the period 
during which the employees become unconditionally entitled to the options. The fair value of the options granted is measured using a 
Black-Scholes model, taking into account the terms and conditions upon which the share options were granted.
Retirement benefit obligation
The Company is a participating employer in the defined benefit pension schemes operated by the Group but it is unable to identify its 
share of the underlying assets and liabilities of the schemes on a consistent and reasonable basis and therefore, as permitted by 
FRS 17, ‘Retirement Benefits’, accounts for the scheme as if it were a defined contribution scheme. As a result, the amount charged to 
the Company’s profit and loss account represents the contributions payable to the scheme in respect of the accounting period and no 
deficit is reflected in the Company balance sheet.
58  Notes to the Company Financial Statements  Annual Report & Accounts 2009
Notes to the Company Financial Statements  Beginning Recognised End
 of period in period of period
2. Fixed asset investments £000 £000 £000
Gross carrying value 156,350 (56,916) 99,434
Provision for permanent diminution in value (123,524) 46,485 (77,039)
Net book value 32,826 (10,431) 22,395
The Directors reviewed the carrying value of investments at the year end and considered whether any adjustment was required to the 
gross carrying value or to the provision for permanent diminution in value. Based on this review the Directors determined that:
(i) The gross carrying value of investments should be reduced by £56,916,000 with an equivalent reduction in the provision for 
permanent diminution in value. This has no net impact.
(ii) An additional provision of £10,431,000 should be recognised in the year.
The net realisable value of investments is based on the lower of cost and the market value of the investments.
The principal subsidiary businesses are as follows:
 Country of
 registration/
Business incorporation Principal activity
Knitwear
Barrie Knitwear
+
 Scotland Manufacture, sourcing, distribution and marketing of Barrie, Glenmac 
  and John Laing cashmere knitwear and contract haute couture.
Dawson Forte* USA Design, sourcing, distribution and marketing of Chinese cashmere 
  knitwear.
Home Furnishings
Dawson Home Group Limited* England Design, sourcing, distribution and marketing of branded and private label 
  bed linen.
Other
Dawson International Holdings (UK) Ltd. Scotland Management services and holding company.
Dawson International Trading Ltd.* Scotland Management services and holding company.
All companies’ share capital is wholly owned and all operate principally in their country of incorporation.
+ Division of Dawson International Trading Ltd.
* Not directly owned by Dawson International PLC
3. Employees
The emoluments of the Executive Directors, who are the only employees of the Company, are given in the Directors’ Report on 
Remuneration on pages 21 to 23.
 2009 2008
4. Debtors – due within one year £000 £000
Owed by subsidiary undertakings 27,690 53,941
 27,690 53,941
Annual Report & Accounts 2009  Notes to the Company Financial Statements  59  2009 2008
5. Creditors – amounts falling due within one year £000 £000
Owed to subsidiary undertakings 38,280 67,739
Other creditors 19 36
 38,299 67,775
 2009 2008
6. Share capital £000 £000
Authorised share capital
2,526,207,225 ordinary shares of 1 pence each 25,262 25,262
101,505,975 deferred shares of 49 pence each 49,738 49,738
50,000,000 preference shares of £1 each 50,000 50,000
75,000,000 preference shares of $1 each 46,000 46,000
 171,000 171,000
Issued equity share capital
Allotted, called up and fully paid:
225,158,542 ordinary shares of 1 pence each 2,251 2,251
101,505,975 deferred shares of 49 pence each 49,738 49,738
  51,989 51,989
  Share Profit and
  premium loss account Total
7. Reserves £000 £000 £000
At beginning of period 5,489 (38,422) (32,933)
Retained profit for the period before impairment of fixed asset investments – 3,758 3,758
Impairment of fixed asset investments – (10,431) (10,431)
Share-based payments – 47 47
At end of period 5,489 (45,048) (39,559)
8. Contingent liabilities
(i) The Company is party to cash offset arrangements on banking facilities made available to the Group. The maximum liability under 
this arrangement is the value of any bank overdraft included within the offset arrangements.
(ii) The Company has guaranteed the obligations of a subsidiary company, Dawson Home Group Limited, under a contract for the 
provision of administration facilities. The maximum liability under this guarantee at year end was £2,329,000.
(iii) As part of the conditions of the sale of Todd & Duncan the Company has guaranteed the lease commitments of the new business 
until August 2014. The maximum commitment under this guarantee is £917,000. No provision has been made as the Directors do 
not consider there is any probable loss.
60  Notes to the Company Financial Statements  Annual Report & Accounts 2009
Notes to the Company Financial Statements (continued) Financial period 2009 2008 2007 2006 2005
 £000 £000 £000 £000 £000
Results
Continuing operations
Revenue 72,883 85,713 92,601 102,093 111,620
Operating profit (loss) before exceptional items 1,406 517 (2,713) (1,511) 2,126
Exceptional items 556 1,342 1,657 (1,617) (1,057)
Profit (loss) on ordinary activities before interest 1,962 1,859 (1,056) (3,128) 1,069
Net finance charges (1,387) (739) (499) (610) (962)
Profit (loss) on ordinary activities before taxation 575 1,120 (1,555) (3,738) 107
Taxation (291) (146) (277) (434) (507)
Profit (loss) after taxation from continuing operations 284 974 (1,832) (4,172) (400)
Loss for the period from discontinued operations (6,127) (498) – – –
(Loss) profit for period (5,843) 476 (1,832) (4,172) (400)
Adjusted (loss) earnings per share
(i)
 (0.1)p (0.2)p (1.5)p (1.2)p 0.6p
2008 results have been re-stated to show the Todd & Duncan business as discontinued. Earlier years have not been re-stated.
Net assets
Intangible assets 143 131 486 552 230
Property, plant and equipment 925 2,285 4,040 5,025 5,272
Working capital 5,963 17,508 25,036 24,905 19,140
Net operating assets 7,031 19,924 29,562 30,482 24,642
Taxation and dividends 1,366 1,358 1,383 1,386 1,361
Net funds (debt) 12,343 5,688 (5,721) (2,994) 9,309
Net assets excluding pension liability 20,740 26,970 25,224 28,874 35,312
Pension liability (19,246) (6,730) (4,701) (19,750) (29,704)
Net assets 1,494 20,240 20,523 9,124 5,608
Capital expenditure 423 527 893 1,591 2,577
Net gearing
(ii)
 nil nil 28% 33% nil
(i) Adjusted earnings per share are based on the results of continuing operations before exceptional items.
(ii) Net gearing is defined as the ratio of total borrowings net of short-term investments, cash and deposits to equity shareholders funds.
Annual Report & Accounts 2009  Five Year Financial Record  61
Five Year Financial Record Financial calendar
Annual General Meeting 5 May 2010
2010 interim results announcement August 2010
End of financial period 1 January 2011
2010 preliminary results announcement March 2011
Key advisers
Brokers/Nominated Adviser: W H Ireland Limited
 11 St James Square
 MANCHESTER
 M2 6WH
Auditors: Deloitte LLP
 (PO Box 500)
 2 Hardman Street
 MANCHESTER
 M60 2AT
Solicitors: Dundas & Wilson CS LLP 
 191 West George Street
 GLASGOW 
 G2 2LD 
Share dealing service
Stocktrade operate a telephone share dealing service which provides shareholders with a way of buying or selling the Company’s shares or 
any other UK listed Company shares. Commission is 0.5 per cent up to £10,000 and 0.2 per cent thereafter, subject to a £15 minimum. To 
use this service please call 0845 601 0995 and quote LOW C0175. Postal dealing packs are available on request.
Registrars and dividend payments
Enquiries regarding shareholdings, lost certificates, change of address and dividend payments should be addressed to the Company’s 
registrars, Capita Registrars, Northern House, Woodsome Park, Fenay Bridge, Huddersfield, West Yorkshire HD8 0GA. Telephone 
0871 664 0300 (calls cost 10p a minute plus network extras, lines are open 8.30am-5.30pm Monday-Friday).
Requests for dividend payments to be made direct to a bank or building society account should also be made to the registrars.
62  Information for Shareholders  Annual Report & Accounts 2009
Information for Shareholders NOTICE IS HEREBY GIVEN that the thirty-seventh Annual General Meeting of Dawson International PLC will be held at Lochleven Mills, 
Kinross, KY13 8GL on Wednesday 5 May 2010 at 12 noon for the following purposes:
As Ordinary Business
1. To receive and consider the Directors’ Report and financial statements for the financial period ended 2 January 2010 (Resolution 1).
2. To adopt the Directors’ Report on Remuneration for the financial period ended 2 January 2010 (Resolution 2).
3. To re-elect David Cooper retiring by rotation as a Director of the Company in accordance with the Company’s Articles of Association 
(Resolution 3).
4. To re-elect David Bolton as a Director of the Company who has agreed to offer himself for re-election at this time (Resolution 4).
5. To elect Giovanni Ghione as a Director of the Company (Resolution 5).
6. To consider and, if thought fit, pass the following Resolution as an Ordinary Resolution of the Company:
 “That Deloitte LLP be and are hereby appointed auditors of the Company to hold office from the conclusion of this meeting until the 
conclusion of the next general meeting at which financial statements are laid before the Company at a remuneration to be fixed by the 
Directors” (Resolution 6).
As Special Business
To consider and, if thought fit, pass the following Resolutions, Resolutions 7 and 8, as Special Resolutions of the Company:
7. THAT the Company be and is hereby generally and unconditionally authorised in accordance with Section 701 of the Companies Act 
2006 (as amended) (the “Act”) to make market purchases (within the meaning of Section 693(4) of the Act) of ordinary share capital of 
the Company (“shares”) provided that:
(a) the maximum number of shares hereby authorised to be purchased shall be 22,515,854, representing 10 per cent of the issued 
ordinary share capital of the Company as at 9 March 2010;
(b) the maximum price which may be paid for a share shall be not more than five per cent above the average of the middle market 
quotations derived from the AIM Appendix to the Daily Official List of the London Stock Exchange for the five business days 
immediately preceding the date of purchase of the share;
(c) unless renewed the authority hereby conferred shall expire 15 months after the passing of this Resolution or at the conclusion of the 
next Annual General Meeting of the Company, whichever is the earlier, save that the Company may, prior to such expiry, enter into a 
contract to purchase shares which will or may be executed wholly or partly after such expiry and purchase shares pursuant to such 
contract (Resolution 7).
8. THAT the share capital of the Company be reduced from £125,000,000 and $75,000,000 to £75,262,072.25 and $75,000,000 by the 
cancellation of the 101,505,975 Deferred Shares in the capital of the Company (Resolution 8).
Dated: 9 March 2010
By order of the Board
David Cooper, Secretary
Lochleven Mills
Kinross
KY13 8GL
Annual Report & Accounts 2009  Notice of Annual General Meeting  63
Notice of Annual General Meeting Notes
1. Votes
In accordance with Regulation 41 of the Uncertificated Securities Regulations 2001, all shareholders who wish to attend and vote at 
the meeting must be entered on the Company’s register of members no later than 6.00pm on Monday 3 May 2010 or, in the case of an 
adjournment, as at 48 hours prior to the time of the adjourned meeting. Changes to entries on the register after that time will be disregarded 
in determining the rights of any person to attend or vote at the meeting.
2. Proxies
2.1 Members entitled to vote at the meeting may appoint a proxy or proxies to exercise all or any of their rights to attend and to speak 
and vote at a meeting of the Company. A member may appoint more than one proxy in relation to a meeting, provided that each proxy 
is appointed to exercise the rights attached to a different share or shares held by them. Such a proxy need not be a member of the 
Company and the appointment of such proxy does not preclude members from subsequently attending and voting in person at the 
meeting or adjournment of the meeting.
2.2 To be effective, the instrument appointing a proxy and any authority under which it is executed (or a copy of such authority notarially 
certified or certified in some other way approved by the Board) must be deposited with the Company’s registrar, Capita Registrars, 
PXS, 34 Beckenham Road, Beckenham, BR3 4TU, not less than 48 hours (disregarding any day that is not a working day) before the 
time for holding the meeting or, in the event of an adjournment, not less than 48 hours (disregarding any day that is not a working day) 
before the time of the adjournment. A corporation must execute the form of proxy under either its common seal or the hand of a duly 
authorised officer or attorney. Any amendments made to the form of proxy must be initialled by the person who signs it.
2.3 CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so for 
the meeting and any adjournment(s) thereof by using the procedures described in the CREST Manual (available from https://www.
euroclear.com/site/public/EUI). CREST personal members or other CREST sponsored members, and those CREST members who have 
appointed a voting service provider(s) should refer to their CREST sponsors or voting service provider(s), who will be able to take the 
appropriate action on their behalf.
In order for a proxy appointment or instruction made by means of CREST to be valid, the appropriate CREST message (a “CREST 
Proxy Instruction”) must be properly authenticated in accordance with Euroclear UK & Ireland Limited’s specifications and must contain 
the information required for such instructions, as described in the CREST Manual. The message must be transmitted so as to be 
received by the Company’s agent, Capita Registrars Limited (CREST Participant ID: RA10), no later than 48 hours (disregarding any day 
that is not a working day) before the time appointed for the meeting. For this purpose, the time of receipt will be taken to be the time 
(as determined by the time stamp applied to the message by the CREST Application Host) from which the Company’s agent is able to 
retrieve the message by enquiry to CREST in the manner prescribed by CREST.
CREST members and, where applicable, their CREST sponsors or voting service provider(s) should note that Euroclear UK & Ireland 
Limited does not make available special procedures in CREST for any particular messages. Normal system timings and limitations will 
therefore apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if 
the CREST member is a CREST personal member or sponsored member or has appointed a voting service provider(s), to procure that 
his CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by 
means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors 
or voting service provider(s) are referred in particular to those sections of the CREST Manual concerning practical limitations of the 
CREST system and timings.
The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5) of the Uncertificated 
Securities Regulations 2001.
64  Notice of Annual General Meeting  Annual Report & Accounts 2009
Notice of Annual General Meeting (continued) Annual Report & Accounts 2009  Notice of Annual General Meeting  65
Notice of Annual General Meeting (continued)
2.4 Unless otherwise indicated the proxy will vote as they think fit or, at their discretion, abstain from voting. The ‘Vote Withheld’ option is to 
enable a member to abstain on any particular Resolution. Such a vote is not a vote in law and will not be counted in the votes ‘For’ and 
‘Against’ a Resolution.
2.5 In the case of joint holders, the vote of the senior holder who tenders a vote, whether in person or by proxy, shall be accepted to the 
exclusion of the votes of other joint holders. For this purpose, seniority shall be determined by the order in which the names of such 
holders stand in the register of members in respect of the joint holding.
2.6 If more than one valid proxy appointment is submitted, the appointment received last before the latest time for the receipt of proxies will 
take precedence.
2.7 To change your proxy instructions simply submit a new proxy appointment using the methods set out above. Note that the cut-off 
time for receipt of proxy appointments (see above) also applies in relation to amended instructions; any amended proxy appointment 
received after the relevant cut-off time will be disregarded. Where you have appointed a proxy using the hard-copy proxy form and 
would like to change the instructions using another hard-copy proxy form, please contact the Company’s registrar, Capita Registrars, 
PXS, 34 Beckenham Road, Beckenham, BR3 4TU.
In order to revoke a proxy instruction you will need to send a signed hard copy notice clearly stating your intention to revoke your proxy 
appointment to the Company’s registrar, Capita Registrars, PXS, 34 Beckenham Road, Beckenham, BR3 4TU to be received not less 
than 48 hours (disregarding any day that is not a working day) before the time for holding the meeting or in the case of a poll taken 
more than 48 hours after it is demanded, before the time appointed for taking the poll. In the case of a member which is a company, 
the revocation notice must be executed under its common seal or signed on its behalf by an officer of the company or an attorney for 
the company. Any power of attorney or any other authority under which the revocation notice is signed (or a duly certified copy of such 
power or authority) must be included with the revocation notice.
If you attempt to revoke your proxy appointment but the revocation is received after the time specified then, subject to the paragraph 
directly below, your proxy appointment will remain valid.
Appointment of a proxy does not preclude you from attending the meeting and voting in person. If you have appointed a proxy and 
attend the meeting in person, your proxy appointment will automatically be terminated.
3. Directors’ Service Contracts 
Copies of the Directors’ service contracts and copies of the Non-Executive Directors’ terms of appointment are available for inspection 
by members at the registered office of the Company during normal working hours on any weekday from the date of this notice until 
the date of the meeting and will be available for inspection at the place of the meeting from 15 minutes prior to the meeting until its 
conclusion.
4. Corporate Representatives
A corporation which is a member can appoint one or more corporate representatives who may exercise, on its behalf, all its powers as a 
member provided that no more than one corporate representative exercises powers over the same share.
5. Communication
Members who have general queries about the meeting should use the following means of communication (no other method of 
communication will be accepted):-
E-mail to: enquiries@dawson-international.co.uk
This e-mail address should only be used to communicate with the Company for enquiries regarding the AGM Notice and Proxy Card.
  66  Annual Report & Accounts 2009 (For use at the Annual General Meeting of Dawson International PLC (“the Company”) to be held at Lochleven Mills, Kinross, KY13 8GL on 5 May 2010 at  
12 noon and at any adjournment thereof.)
I/We being a member of the Company, holding   ordinary shares (see note 3) of one pence each in the capital of the Company hereby 
appoint the Chairman of the meeting, or     (see note 1) as my/our proxy vote for me/us on my/our behalf as indicated 
below at the Annual General Meeting of the Company to be held on 5 May 2010 and at any adjournment thereof.
If you are appointing more than one proxy please place an X in the box opposite.
Ordinary Business  For Against Vote Withheld (see note 6)
1 Adoption of Directors’ Report and financial statements
2 Adoption of Directors’ Report on Remuneration
3 Re-election of David Cooper as a Director
4 Re-election of David Bolton
+*~
 as a Director
5 Election of Giovanni Ghione
*~
 as a Director
6 Appointment of Deloitte LLP as auditors 
Special Business
7 Authorisation to make market purchases of shares
8 Authorisation to reduce the capital by cancellation of the Deferred Shares
+ Member of the Audit Committee
* Member of the Remuneration Committee
~ Member of the Nominations Committee
Unless otherwise indicated, the proxy may vote as they think fit, or withhold their vote, on the above Resolutions or on other business conducted at the meeting.
Signed this    day of     2010 (Please insert date and sign. If a corporation, see note 5)
Signature
Name of registered holder (IN BLOCK CAPITALS, PLEASE)
Address (IN BLOCK CAPITALS, PLEASE)
Notes
1. A member entitled to attend, speak and vote at the meeting is also entitled to appoint one or more proxies to attend, speak and vote instead of them. 
To appoint as a proxy a person other than the Chairman of the meeting insert the full name in the space provided. A proxy need not be a member of the 
Company. You can also appoint more than one proxy provided each proxy is appointed to exercise the rights attached to a different share or shares held by 
you. The following options are available:
(a) To appoint the Chairman as your sole proxy in respect of all your shares, simply fill in any voting instructions in the appropriate box and sign and date 
the form of proxy;
(b) To appoint a person other than the Chairman as your sole proxy in respect of all your shares, delete the words ‘the Chairman of the meeting (or)’ and 
insert the name and address of your proxy in the space provided. Then fill in any voting instructions in the appropriate box and sign and date the form of 
proxy;
(c) To appoint more than one proxy, you may photocopy this form. Please indicate the proxy holder’s name and the number of shares in relation to which 
they are authorised to act as your proxy (which, in aggregate, should not exceed the number of shares held by you). Please also indicate if the proxy 
instruction is one of multiple instructions being given. If you wish to appoint the Chairman as one of your multiple proxies, simply write ‘the Chairman of 
the meeting’. All forms must be signed and should be returned together in the same envelope.
2. Unless otherwise indicated the proxy will vote as they think fit or, at their discretion, abstain from voting.
3. Please enter number of ordinary shares of one pence each in the capital of the Company held by you. If no number is entered, it shall be presumed that the 
proxy is entitled to vote in respect of all such ordinary shares held by you as registered holder.
4. To be valid for the meeting, this form of proxy should be completed, signed and lodged with the Company’s registrars, Capita Registrars, PXS, 
34 Beckenham Road, Beckenham, BR3 4TU during usual business hours not less than 48 hours (disregarding any day that is not a working day) before 
the time set for the meeting or in the event of an adjournment, not less than 48 hours (disregarding any day that is not a working day) before the time of the 
meeting, accompanied by any power of attorney under which it is executed (if applicable). Any alteration to this form of proxy must be initialled.
5. A corporation must execute the form of proxy under either its common seal or the hand of a duly authorised officer or attorney.
6. The ‘Vote Withheld’ option is to enable you to abstain on any particular Resolution. Such a vote is not a vote in law and will not be counted in the votes 
‘For’ and ‘Against’ a Resolution.
7. Completion and return of the form of proxy will not preclude you from attending and voting in person at the meeting should you subsequently decide to do so.
8. In the case of joint holders, the vote of the senior holder who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes 
of other joint holders. For this purpose, seniority shall be determined by the order in which the names of such holders stand in the register of members in 
respect of the joint holding.
9. Any amendments made to this form of proxy must be initialled by the person who signs it.
10. CREST members should use the CREST electronic proxy appointment service and refer to Note 2.3 of the Notice of Annual General Meeting in relation to 
the submission of a proxy appointment via CREST.
11. If you submit more than one valid proxy appointment, the appointment received last before the latest time for the receipt of proxies will take precedence.
12. For details of how to change your proxy instructions or revoke your proxy appointment see the notes to the notice of meeting.
Annual Report & Accounts 2009  Form of Proxy  67
Form of Proxy  Corporate Directory
 
DAWSON INTERNATIONAL PLC
Secretary and Corporate Office
David Cooper
Lochleven Mills, Kinross,
KY13 8GL, Scotland
Tel:  01577 867000 
Fax:  01577 867010
 
Registered Office
Lochleven Mills, Kinross,
KY13 8GL, Scotland
Registered Number SC54505
 
Website:  www.dawson-international.co.uk
E-mail:  enquiries@dawson-international.co.uk w w w .mearsash. c om DAWSON INTERNATIONAL PLC
Lochleven Mills
Kinross, KY13 8GL
Scotland