Annual Report and Accounts
52 WEEKS TO 29 APRIL 2006
committed to progress Our Business
Contents
1 Financial Highlights
1 Operational Highlights
2 Board of Directors
4 Chairman’s Statement
6 Chief Executive’s Review
9 Group Finance Director’s Review
12 Corporate Social Responsibility Statement
15 Directors’ Report
18 Report on Directors’ Remuneration
24 Corporate Governance
28 Corporate Governance Summary
32 Independent Auditors’ Report
33 Statement of Directors’ Responsibilities
34 Group Income Statement
34 Statements of Recognised Income and Expense
35 Balance Sheets
36 Group Cash Flow Statement
37 Notes to the Financial Statements
65 Five Year Financial Record
66 Notice of Annual General Meeting
72 Financial Calendar
72 Shareholder Information
72 Advisers
73 Locations
Our clients include:
•
Motor insurers
•
Car retailers
•
Motor manufacturers
•
Local and public authorities
•
Private car owners
•
Fleet intermediaries and operators
Universal Salvage manages the collection
and disposal of vehicles (typically accident-
damaged or of low-value) for a broad range
of clients. The Group handles a wide range
of vehicles, including accident-damaged
cars, commercial vehicles and motor cycles;
low-value vehicles sold on a fee basis; and
End-of-Life, abandoned and tax default
vehicles. The Group sells most of these
vehicles at auction – indoor, outdoor and 
on the Internet – and recycles the remaining
vehicles via its authorised recycling facilities. 1 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
2006 2005
Revenue £56.4m £49.7m
Gross proﬁt £10.8m £10.1m
Proﬁt/(loss) before taxation – pre-exceptional £0.5m (£1.5m)
Proﬁt/(loss) before taxation £0.2m (£1.1m)
Earnings/(loss) per share – basic 2.4p (5.8p)
Net cash from operating activities £1.3m (£1.7m)
Operational Highlights
•
Return to proﬁtability
•
Debt levels reduced signiﬁcantly
•
Restructuring largely completed 
•
New position of Chief Operating Ofﬁcer created
•
New Sales Director appointed
•
Continuing to strengthen relationships with existing and prospective clients
•
Increased credibility in the marketplace
•
New signiﬁcant contract wins
•
Progress in diversifying into corporate marketplace
Financial Highlights 2 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Board of Directors
Alexander N Foster Non-executive Chairman, Senior Non-executive Director (60)
Managing Director of Hiscox Investment Management Limited, part of Hiscox plc with over 38 years’ experience 
in the insurance industry. He has been a Non-executive Director of Universal Salvage plc since ﬂotation in 
1995 and was appointed Non-executive Chairman on 1 January 2000. He is also a Non-executive Director of
Midas Capital Partners.
Avril Palmer-Baunack Chief Executive (42)
Joined Universal Salvage plc as Managing Director on 1 March 2005 and was appointed Chief Executive on 
19 September 2005. She has spent 18 years working in the automotive industry and has substantial experience 
of vehicle salvage, ﬂeet management services and car rental sectors. Previously she worked for FMG Group,
Europcar UK Limited (part of Volkswagen AG) and the Cauldwell Group.
Andrew F Somerville Group Finance Director (46)
Joined Universal Salvage plc on 24 March 2003 and was appointed to the Board as Group Finance Director on 
that date. He has held senior ﬁnance positions at Bunzl plc and Corporate Express (UK) Limited. Prior to joining
Universal Salvage plc he was Group Finance Director of Baldwins Industrial Services PLC.
Alexander N Foster Avril Palmer-Baunack Andrew F Somerville  3 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Nigel S Terry Non-executive Director (55)
Joined the Board of Universal Salvage plc on 1 September 2003. He has 30 years’ experience within the 
food industry and of the sales and procurement process in particular. He is currently a Non-executive Director 
on the boards of Harpenden Building Society and Pinguin Foods UK Limited, and a Director on the board of 
Lennox Holdings Plc.
Nigel C Stead Non-executive Director (57)
Joined the Board of Universal Salvage plc on 1 March 2006. He has over 30 years’ experience in the automotive
industry across the manufacturing, retail and leasing and ﬂeet management sectors. He is currently Managing
Director of Lloyds TSB Autolease and a Director of the British Vehicle and Rental Leasing Association, an industry
trade association.
Richard B Mead Non-executive Director (58)
Joined the Board of Universal Salvage plc on 18 April 2006. He is a Chartered Accountant and spent over 20 years
in corporate ﬁnance including at Credit Suisse First Boston and Ernst & Young. For the last 12 years he has worked
as an independent consultant and has served as Non-executive Chairman or Director of a number of quoted and 
private companies. He is currently Chairman of Stonemartin plc and a Non-executive Director of IX Europe plc,
both of which are quoted on AIM.
Edmund P Bruegger Non-executive Director (55)
Joined the Board of Universal Salvage plc on 1 December 1998. He resigned as a Non-executive Director on 
6 January 2006.
Nigel S Terry Nigel C Stead Richard B Mead 4 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
‘‘Over the last twelve months, we have 
made substantial progress in re-establishing 
Universal within the insurance marketplace.
Our new salvage contracts demonstrate 
we have gone a long way to rejuvenating 
the business.’’
RESULTS
I am pleased to report that the Company has returned
to proﬁt.
For the 52 weeks to 29 April 2006, the Group made 
an operating proﬁt, before exceptional items, of 
£0.9 million this year which is a considerable
improvement on the operating loss, before exceptional
items, of £0.9 million last year. Statutory operating
proﬁt of £0.7 million was achieved during the year
(2005: loss of £0.1 million). Proﬁt before exceptional
items and tax at £0.5 million showed an improvement
of £2.0 million on last year (2005: loss before
exceptional items and tax of £1.5 million). Proﬁt 
before tax was £0.2 million (2005: loss of £1.1 million).
Revenue rose by 13% to £56.4 million from 
£49.7 million last year. These results were supported 
by a 10% reduction in administrative costs before
exceptional items, to £9.9 million from £11.0 million
and an improvement in gross proﬁt of 7% to 
£10.8 million from £10.1 million last year. Basic
earnings per share improved to 2.4 pence (2005: loss
per share of 5.8 pence). The Board is not recommending
a dividend in line with last year. In the last ﬁnancial
year, we achieved our target of reducing operating costs
by £2.0 million on an annualised basis. Over this year,
we have made further cost reductions, equating to a
further £1.0 million on an annualised basis. At the 
year-end, net assets increased to £15.8 million (2005:
£14.8 million). Net debt decreased to £4.2 million
compared to £5.9 million last year. Gearing has been
reduced to 27%, a comfortable level (2005: 40%).
Results have been issued under the new International
Financial Reporting Standards (‘IFRS’) and comparative
ﬁgures have been restated from those previously
reported under UK GAAP.
BUSINESS TURNAROUND
The year under review is the second year of our original
three year Business Turnaround Plan. Over the last
twelve months, we have made substantial progress 
in re-establishing Universal within the insurance
marketplace. Our new salvage contracts demonstrate
we have gone a long way to rejuvenating the business.
We have now largely completed the rationalisation of
the branch network. In April, we sold our Paddock Wood
site in Kent for £0.8 million and, after the year-end, in
May, we disposed of our Staughton Moor branch in
Cambridgeshire for £0.25 million. These sales follow last
year’s surplus property disposals and leave the Group
operating comfortably from seven sites. An eighth site
is not operational and leased to a third party.
Alexander N Foster 
Chairman
Chairman’s Statement 5 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
As I reported in my statement at the half year,
we believe that there is good scope to broaden our
customer base. Target markets we have identiﬁed are
corporate ﬂeets, car rental companies and accident
management companies and we have been actively
building relationships within each sector. I am pleased
to report that we signed a number of small accounts
with ﬂeet operators, including Europcar and Bankstone.
Volumes in these markets are typically lower than in
our traditional insurance marketplace, however the
quality of salvage is attractive.
BOARD CHANGES
I am delighted to welcome two new Non-executive
Directors; Nigel Stead, joined in March and Richard
Mead, in April. Nigel is Managing Director of Lloyds 
TSB Autolease, the ﬂeet management and ﬁnancing
specialist, and has over thirty years’ experience in 
the automotive industry. Richard Mead, a Chartered
Accountant, has spent over twenty years in corporate
ﬁnance and has wide ranging business experience.
Richard chairs the Audit Committee. After serving seven
years as a Non-executive Director, Edmund Bruegger
stepped down from the Group in January this year.
I would like to thank him for his contribution during 
his time on the Board.
STAFF
The Group’s return to proﬁtability this year is a 
result of the dedication and effort of everyone in the
business. On behalf of the Board, I would like to thank
all the staff for helping to move Universal forward.
PROSPECTS
Over the new ﬁnancial year we expect to improve
proﬁtability, although the rate of growth will depend 
on vehicle volumes and auction results remaining ﬁrm.
I am convinced there are good opportunities to use our
market knowledge and skills in handling auto salvage 
to develop new income streams. Our strategy remains 
a twofold approach of continuing the process of
developing our existing business and at the same 
time broadening out into other related areas.
We have the people to drive Universal forward 
with vision and vigour in the year ahead.
Alexander N Foster 
Chairman
24 July 2006
We have also completed the major changes to
strengthen our senior management team. Two key
appointments were made in the ﬁrst quarter of the
year when we created the new position of Chief
Operating Ofﬁcer and recruited a new Sales Director.
We also strengthened our sales and marketing
functions and brought in people with experience in the
accident management industry to support our planned
move into a broader range of outsourced support
services for the motor insurance and ﬂeet marketplaces.
We continue to work hard on building our relationships
with our core customer base in the UK motor insurance
sector. There has been considerable consolidation within
the insurance industry and the insurance salvage
market remains highly competitive. However, we were
pleased to secure two signiﬁcant contracts last year
when we signed an agreement with Admiral Insurance
Services Limited, covering the South of England and 
in September won an exclusive national contract with
Co-operative Insurance Society Limited. In May this
year, we were appointed as joint supplier by Highway
Insurance Company Limited, the beneﬁt of which will
be felt in the current ﬁnancial year.
We have been in discussions with some of our
insurance clients about moving from the traditional
model of acting as principal, when buying vehicle
salvage, to providing a fee-based service where we act
only as a disposal agent. Two major accounts now trade
on this basis and the change will help to stabilise our
income streams going forward. 6 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
INTRODUCTION
I am very pleased with the progress we have made in
the second year of our Business Turnaround Plan. On a
trading level, we secured a good level of new contracts
and on the operational side, we have improved
efﬁciency. Most importantly, I am delighted with 
the fact that we have returned the Group to proﬁt.
BUSINESS DEVELOPMENT
The ﬁrst year of our Business Turnaround Plan was
focused on securing the Group’s ﬁnancial position 
and addressing the cost base, which was too high 
in relation to the throughput of vehicles. In the 
second year, we have been concentrating on business
development. The most important issue for the
business is growing turnover. This has meant
revitalising our sales and marketing activities and 
re-building our credibility within our core insurance
market as well as turning our attention to considering
how we develop new income streams outside this 
core market.
In mid June, we appointed a new Sales Director 
who took on the responsibility of strengthening 
our sales and marketing efforts and pursuing tender
opportunities. Since the consolidation in the UK motor
insurance marketplace, there has been a general trend
downwards in the frequency of tenders. Nevertheless,
in June 2005 we were pleased to be appointed as a
‘‘We are pleased to have returned the 
business to proﬁtability and improved 
operating cash generation. The business
has good growth potential and we 
are conﬁdent of delivering improved 
results over the year.’’
Avril Palmer-Baunack 
Chief Executive
Chief Executive’s Review 7 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
supplier to Admiral Insurance Services Limited, covering
the South of England and we have subsequently been
reappointed for a further term. Also in the ﬁrst half of
the year, in September, we signed a national agreement
with Co-operative Insurance Society Limited (‘CIS’).
This major contract is for a two year period and we are
the sole supplier. CIS is also using our on-line salvage
management system, which enables insurance claims
and vehicles to be processed more efﬁciently. More
recently after the year-end, we secured a contract from
Highway Insurance Company Limited, which started 
on 1 May 2006.
We are achieving good returns at our auctions, with
ﬁrm demand from vehicle repairers and dismantlers
and steady bid prices. We have optimised returns
through a series of specialist sales, including ‘classic’
cars, light commercial vehicles and motor cycles. As
well as taking on-line absentee bids, we are also making
more use of on-line auctions, with our sites at Denny 
in Stirlingshire, Westbury in Wiltshire and Chester 
in Flintshire selling their vehicles only through the
Internet rather than through auctions at the site.
This is working very well.
Historically, vehicle salvage operators have acted as
principal when selling salvage vehicles from motor
insurers. However, there is some movement away 
from this traditional model and we have been talking
to some of our key insurance customers about
providing the service as agents, acting on a fee basis
rather than as principal buying the vehicle salvage from
them. Two major accounts are now trading like this and
the change will help to reduce our risk exposure, and
create more stable income streams.
Income from our non-salvage fee-based business
(principally low-value, part-exchange cars) suffered
from the failure of a major customer, Yes Car Credit,
which was closed by its parent, Provident Financial PLC
in December 2005. As a result, volumes fell by
approximately 16,000 units per annum.
As an authorised treatment facility (‘ATF’) for the
disposal of End-of-Life Vehicles (‘ELVs’), we have joined
the network of ATFs created by a consortium of
industrial vehicle shredders, who have created the free
‘Cartakeback’ service for motor manufacturers. This is in
readiness for next year when, from January 2007 motor
manufacturers will be responsible for the free take back
of their own marque ELVs. It is difﬁcult to predict the
volumes of vehicles that we will handle, but the current
strong steel prices make joining the Cartakeback
network an interesting option for us.
We have been pursuing opportunities to offer our
salvage services to a wider range of customers,
targeting corporate ﬂeets, accident management companies and car rental providers. This initiative 
is working well and we have secured a number of 
small accounts with ﬂeet operators. The quality of
salvage should be good, given the typical age proﬁle 
of these vehicles.
OPERATIONS
We created the new role of Chief Operating Ofﬁcer 
in July 2005, in order to strengthen the operations side
of the business. We believed that there was scope to
introduce new core competencies and drive cultural
change that would improve efﬁciencies and reduce 
unit disposal costs.
We have now implemented new processes and other
initiatives, which are working well and I am pleased 
to see the beneﬁts in increased productivity.
Our site rationalisation programme was substantially
completed just after the year-end in May when 
we sold our property at Staughton Moor in
Cambridgeshire. During the year, we also sold our
Paddock Wood site in Kent. The gross cash proceeds
from the two sales were £1.05 million. These disposals
leave us with eight sites, at Denny in Scotland, Sandtoft,
Chester, Westbury, Sandy, Sandwich, Wootton and
Corby. We have let our Corby site, which is surplus to
our current requirements and our remaining seven sites
leave us with good operational capacity, having some
150 acres of vehicle storage space.
With the changes we have made this year, the
restructuring of the cost base has been largely
completed. We anticipate annualised cost savings of
£1.0 million going forward. Any future reductions in the
cost base are likely to be relatively small by comparison.
Our major capital expenditure this year related 
to the acquisition of four new car transporters at a
total cost of £0.3 million. This forms part of our ﬂeet
replacement programme. Otherwise we contained
costs very tightly.
STAFF
I would like to thank all the staff for supporting the
business through the Business Turnaround Plan.
Due to the difﬁcult trading situation over the last three
years, we were unable to provide the staff with a pay
increase; however, the Board and I were very pleased to
be able to reinstate the annual pay review in June 2006.
OUTLOOK
We are pleased to have returned the business to
proﬁtability and improved operating cash generation.
This was aided by stable auction results and strong
scrap prices particularly in the second half of the
ﬁnancial year, which is our busier period because it
includes the winter and spring months. Our results also
beneﬁted from our new contract wins although the
actual vehicle volumes that came through were a little
behind insurers’ initial predictions.
Conditions in the insurance salvage market remain
competitive but we are continuing to pursue all tender
opportunities. At the same time, we are pleased with
the progress we are making in diversifying the business
base. The business has good growth potential and 
we are conﬁdent of delivering improved results over
the year.
Avril Palmer-Baunack 
Chief Executive
24 July 2006
8 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Chief Executive’s Review
CONTINUED 9 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Group Finance Director’s Review
RESULTS
On 11 May 2006, the Board issued an announcement
to the London Stock Exchange in which it was
indicated that the Group anticipated that it would
report a small pre-exceptional, pre-tax proﬁt for the 
52 weeks to 29 April 2006. I am therefore pleased to
report that the actual pre-exceptional, pre-tax proﬁt 
for the 52 weeks to 29 April 2006 is £0.5 million 
(2005: loss of £1.5 million).
The Group continues to execute its Business
Turnaround Plan, with the second year of the three 
year plan showing a return to proﬁtability at a 
pre-exceptional, pre-tax level. The return to proﬁtability
has happened a year ahead of plan. Year-on-year, the
operating proﬁt (before exceptional items and interest)
shows a £1.8 million improvement, with a proﬁt of
£0.9 million in the year just ended compared to a 
loss of £0.9 million in the comparative period. After
interest costs, the proﬁt before exceptional items of
£0.5 million compares to the loss before exceptional
items of £1.5 million in 2005. After exceptional items,
the proﬁt before tax of £0.2 million in 2006 compares
to a loss of £1.1 million in 2005. All ﬁgures, including
comparatives, are now based on International Financial
Reporting Standards (‘IFRS’).
Volumes of salvage vehicles disposed of increased by
19% on the prior period as a result of the insurance
account wins announced earlier in the ﬁnancial year.
On the other hand, volumes of non-salvage fee-based
vehicles disposed of decreased by 32% and End-of-Life
Vehicles (‘ELVs’) by 39%. The former reduced due to
the loss of the business with Yes Car Credit in
December 2005, when its parent company, Provident
Financial PLC, decided to close the division. The latter 
is due mainly to continuing strong metal prices,
resulting in fewer abandoned vehicles. This means that
overall the balance of the business has changed, so that
approximately three-quarters of the vehicles disposed
of in the period were sourced from salvage clients
(mainly insurance companies), compared to
approximately two-thirds in the prior period.
Pricing at our auctions remained steady throughout 
the year and compared closely to 2005. However, the
trading gross proﬁt percentage for 2006 reduced to
19.1%, compared to 20.3% in 2005. There are two
main reasons for this change. The ﬁrst is as a result of
the reduction in volumes from both the non-salvage
fee-based and ELV business areas, as the income from
these parts of the business is at a higher gross proﬁt
percentage than that achieved from salvage sales.
Andrew F Somerville
Group Finance Director 10 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
The second reason is that the new business taken on
has typically been achieved at a lower than average
gross proﬁt, due to the competitive nature of the
current marketplace. In particular, this is the case for
new fee-based salvage contracts, where the risk of 
the vehicles residual values rest with the client. An
account with a lower risk proﬁle will typically result 
in a lower gross proﬁt percentage.
Overall, the combination of the lower gross proﬁt
percentage, more than offset by volume growth in
salvage sales, has resulted in an increase in the total
gross proﬁt value from £10.1 million in 2005 to 
£10.8 million in 2006.
In addition to the higher level of gross proﬁt, the
restructuring activity undertaken during 2005, and 
to a lesser extent in 2006, has resulted in a signiﬁcant
reduction in overheads at both branch and head 
ofﬁce levels. Total overheads before exceptional items
reduced from £11.0 million in 2005 to £9.9 million in
2006. In 2006, two more branches were converted to
Internet only branches, leaving the Group with three
Internet only branches and three locations running
both Internet and physical auctions.
Following the signiﬁcant restructuring of our property
portfolio in 2005, there were two more property
disposals, one before the end of the ﬁnancial period 
in April 2006, and one after the end of the ﬁnancial
period in May 2006. The ﬁrst was the sale of our site at
Paddock Wood in April 2006, realising £0.8 million and
generating a proﬁt on disposal of £0.3 million. The
second was the sale of our site at Staughton Moor 
in May 2006, realising £0.25 million and generating a
proﬁt on disposal of £0.1 million. Both of these sites
were mothballed some time ago and were surplus to
operational requirements. The proceeds from the two
site sales have been used to reduce the Group’s net
indebtedness.
Following the improvement in the Group’s trading
performance, coupled with the reduction in net
borrowings arising from both improved trading and the
surplus property disposals, the Group was moved back
from the specialised lending services division to the
commercial division of its bank, The Royal Bank of
Scotland plc, in March 2006. This demonstrates how
much progress the business has made over the last 
two years since announcing signiﬁcant losses in 2004.
CAPITAL EXPENDITURE
Capital expenditure in the last two ﬁnancial years, by
asset type, was as follows:
29 APRIL 2006 30 APRIL 2005
£m £m
IT 0.2 0.1
Land and buildings 0.1 0.2
Plant and transporters 0.6 0.3
Total 0.9 0.6
Capital expenditure remained under tight control, with
limited investment in new assets.
In the period, a small number of new transporters were
ordered to strengthen the ﬂeet. As at the period end,
four of the seven transporters which had been ordered
had been delivered and commissioned into the ﬂeet.
Finance for these transporters was arranged through
hire purchase contracts. The remaining transporters 
are expected to come into the ﬂeet during the summer
of 2006.
LIQUIDITY AND BORROWINGS
The Group’s net borrowings at year-end comprised the
following:
29 APRIL 2006 30 APRIL 2005
£m £m
Bank loan (5.6) (5.6)
Overdraft – (0.2)
Finance leases and 
hire purchase contracts (0.4) (0.1)
Cash and cash equivalents 1.8 –
Total (4.2) (5.9)
Gearing, being the Group’s net borrowings to equity
shareholders’ funds, was 27% at the end of the
ﬁnancial period compared to 40% at the end of 
2005. Following the year-end, cash on deposit has been
used to pay down the Group’s bank loan, in order to
reduce net interest costs. With the improved trading
performance and debt reduction resulting from the sale
of the Group’s surplus properties, discussions are
ongoing with the Group’s bank as to the appropriate
future structure for the Group’s debt facilities.
It is the Group’s policy that no trading in ﬁnancial
instruments is undertaken and this has been the 
case throughout the period under review.
Group Finance Director’s Review
CONTINUED 11 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
REVALUATION RESERVE
Following the revaluation exercise undertaken in 
May 2004, no further revaluation has been performed
for accounting purposes during the 52 weeks to 
29 April 2006, other than the work required to enable
the Group to report its ﬁgures on an IFRS basis.
TAXATION
Taxation for the 52 weeks to 29 April 2006 amounted
to a net credit of £0.5 million (2005: charge of 
£0.5 million). This credit comprises a charge to current
tax of £0.1 million (2005: charge of £0.5 million) which
arises from the capital gain realised on the sale of the
site at Paddock Wood, offset by a deferred tax credit 
of £0.6 million (2005: £nil) which arises from the
utilisation of losses carried forward from prior periods.
The Board considers it probable that the losses carried
forward from prior periods will be utilised against
available taxable proﬁts in the foreseeable future and
therefore believes it is appropriate to recognise the
beneﬁt of these losses in the form of a deferred tax
asset, as required under IAS12 ‘Income Taxes’, in the
results for the 52 weeks to 29 April 2006.
DIVIDENDS
The Board is not proposing a final dividend 
(2005: nil pence per share) giving a total dividend of 
nil pence per share (2005: total of nil pence per share).
The Board believes that at the current time any cash
generated from trading should be re-invested in the
business.
IMPACT OF IFRS
The Group adopted IFRS with effect from 2 May 2004.
The comparative ﬁgures in these ﬁnancial statements
for the 52 weeks to 30 April 2005 have been restated
onto an IFRS basis. The Group’s ﬁnancial statements
have been mostly impacted by IFRS 2 ‘Share-based
Payment’, IAS12 ‘Income T axes’, IAS16 ‘Property, Plant
and Equipment’ and IAS17 ‘Leases’. Reconciliations as
at the date of transition (2 May 2004) and as at the
comparative balance sheet date of 30 April 2005
between the key income statement and balance sheet
ﬁgures as reported under UK GAAP and as reported
under IFRS are shown in note 31 to the ﬁnancial
statements.
GOING CONCERN
The Group balance sheet at the end of the ﬁnancial
year included net current assets of £1.5 million,
compared to net current liabilities of £0.6 million 
last year.
The Directors consider that, after making appropriate
enquiries, there is reasonable expectation that the
Group has adequate resources to continue in
operational existence for the foreseeable future.
For this reason, the going concern basis will continue 
to be adopted in the preparation of the ﬁnancial
statements.
Andrew F Somerville
Group Finance Director
24 July 2006 12 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
The Group continues to work to improve and enhance
its corporate social responsibilities and ensures that the
Group is organised so that it operates in a social and
responsible manner.
This report covers how we treat our customers and
employees and describes the measures we have
undertaken which address social, ethical and
environmental matters. It also details how we support
the communities in which we work. We are proud 
of our achievements in this area this year and share
some of our successes with you in the community 
and charity section.
The Group maintains its work with the Police Service,
Trading Standards and other regulatory bodies to assist
in the reduction of vehicle crime and believes it sets
standards for others in our industry to follow.
Responsibility for implementing the Company’s 
policies rests with the Chief Executive.
ETHICS
The Group’s core principles of trust, mutual respect 
and integrity in business are critical to our continued
success. These principles are formalised in our Code 
of Ethics which is communicated throughout our
organisation, in the induction process for new
employees and published on our Company Intranet.
The Group has issued whistleblowing procedures to 
its employees to enhance the business commitment 
to ethical trading.
EMPLOYEES
The Group employs 296 people throughout the UK 
and recognises the contribution of our employees to
Universal’s performance and proﬁtability. We maintain
policies to support our core principles and encourage
good staff relationships.
We are committed to the principle and practice of
equal opportunity in employment. We do not tolerate
discrimination, bullying or harassment. We apply
common terms and conditions to both permanent and
temporary staff and comply with relevant UK and EU
rights and employment legislation.
Through a variety of channels, Universal provides
employees with information about the Group’s
strategic plans and performance and other issues
affecting individuals as employees. These channels
include regular meetings between senior management
and staff and the use of the Company Intranet.
Employees are encouraged to comment on Group
developments and present their own suggestions 
and views.
The Group places a strong emphasis on training and 
career development and encourages the involvement
of its employees in the planning and direction of 
their work, in order to achieve the ongoing personal
development of the individuals who work for the
Group. The Group aims to ensure that all employees
have the knowledge, skills and experience to
satisfactorily meet the standards required for effective
performance of their work and to deliver an excellent
and efﬁcient service to our customers.
The Group also strives to provide all employees 
with good and safe working conditions, and values 
and respects the individuality and diversity that 
every employee brings to the business.
Employees are encouraged to become involved in the
performance of the Group through participation in the
Group’s SAYE Scheme and Executive Share Option
Schemes.
HEALTH AND SAFETY
The Group recognises that a safe and healthy working
environment for its staff, customers, members of the
public and any other third party in all places that the
Group operates is of paramount importance. In the
year we have reviewed, updated and re-issued revised
risk assessments and continually monitor this area 
to take account of new business practices and 
Corporate Social Responsibility Statement
Members of Wootton Head Ofﬁce in pirate costume raising
money for the BBC Children in Need Appeal. 13 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
procedures. High standards of environmental and 
social responsibility are imperative to improving the
operational performance of the Group’s activities.
The Group continues to:
•
strive to improve health and safety performance
through the continued development of the branch
risk management and safety audit process and
staff development initiatives;
•
develop and maintain a positive health and safety
culture through training, information, instruction
and supervision to ensure understanding and
competency;
•
communicate working practice changes and
associated risk assessments to all employees
through the Group Business Compliance Director,
the Branch Managers, the Health and Safety
representatives and the Group Human Resources
department;
•
systematically identify hazards and adequately
assess and control risks to which employees and
others may be exposed;
•
aim to prevent accidents, providing personal
protective equipment, safe and appropriate plant
and machinery;
•
ensure safe manual handling; and
•
prevent cases of work-related ill health through
investigation, dialogue and monitoring.
Managing the Group’s health and safety goals, as 
well as monitoring and improving the safety record,
requires continual measurement and a joint effort on
the part of management and staff, together with the
co-operation of all visitors to our sites.
Health and safety within the Group has equal status
with all other business objectives and the Company’s
Health and Safety Policy is based on the belief that
accidents can be prevented.
The Group’s policy requires all operating sites to
comply with all applicable laws and regulations.
All employees receive appropriate training and are
personally responsible for bringing to the attention 
of management any health and safety incident.
ENVIRONMENT
The Directors regard the protection of the 
environment as an essential part of the Group’s
corporate responsibilities. Our primary responsibility 
is managing the impact of our operation on the
environment.
The Group has taken the following initiatives in respect
of ELVs and the environment:
•
all sites are registered with the Environment
Agency (‘the EA’) under the Hazardous Waste
Regulations 2005 covering our site activities;
•
has introduced its own in-house training
programme for staff processing vehicles to achieve
the technical competency required to meet its
responsibilities under the Waste Management
Licence Regulations;
•
is making changes to our lighting and power
requirements using the latest low energy use
equipment;
•
limiting external lighting on our sites and
experimenting with infrared systems that maintain
the integrity of our security arrangements and
reduce both light pollution and operating costs;
•
is making the maximum practical use of recycling;
•
minimising the production of waste and 
managing the disposal of necessary waste in a 
safe manner;
•
all sites have water meters and we minimise usage
for vehicle cleaning, and
•
continuing the exploration of the European market
for the sale of ELV materials for recycling and
remanufacture.
The Group works closely with the EA in all the
locations in which it operates and environmental
procedures, risk assessments and solutions are
continually being developed, monitored and updated
with the guidance and assistance of the EA.
The Group also aims to raise employee awareness of
environmental issues that impact upon the Group by
encouraging training and communication initiatives.
The Group also seeks to minimise the visual impact 
of its sites wherever possible and monitors potential
nuisance such as noise and trafﬁc impact to the public.
The Group continues to review its transport and
vehicle management resulting in a continued reduction
in transport costs. Universal encourages all of its
employees who receive a car allowance to purchase
low CO
2
emitting diesel engine cars and ﬁnancially
penalises high mileage drivers who drive petrol engine
vehicles. It also ensures that its transport ﬂeet
undergoes a rigorous preventative maintenance
programme so that all vehicles operate at peak
performance. In respect of its transport ﬂeet, the 
Group is actively piloting measures to achieve a
reduction in fuel usage and maximises truck efﬁciency
with full loads wherever possible when collecting and
delivering vehicles. 14 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
CUSTOMERS
In dealing with our customers we always seek to 
be open, to provide the service and information that
our customers require and to build good relationships
based upon mutual trust and efﬁcient service. We
believe that it is important to maintain an open
dialogue with our customers about the services we
provide and seek to learn what we can do to improve
our service offering in the future. To achieve this 
we will:
•
build relationships on trust and conﬁdence;
•
work with customers to create added value;
•
win and maintain customers by developing and
promoting a range of services that are high quality,
safe, environmentally acceptable and value for
money;
•
communicate regularly with our customers 
and listen to their views;
•
ensure that our services are supported by the
requisite technological, environmental and
commercial expertise;
•
respond promptly to customer feedback by 
taking speedy action to improve the levels of 
our performance; and 
•
make progress by concentrating on what our
customers tell us they want.
SUPPLIERS AND SUBCONTRACTORS
The Group will encourage its suppliers and
subcontractors to abide by the principles contained in
its ethics policy. We aim to obtain the highest quality
products, services and value for money from our
suppliers and subcontractors.
We expect our complaints to be dealt with promptly
and that action will be taken to continually improve
service and performance.
We will pay in accordance with contractual terms 
for the products and services, which meet our
requirements.
We will always treat our suppliers and subcontractors
on a fair and equitable basis and ensure that we
conduct our relationships so that there are no personal
obligations which might inﬂuence purchasing decisions.
INVESTOR RELATIONS
The Board attaches the highest importance 
to maintaining good communication with its
shareholders. Please refer to the investor relations
section of the Corporate Governance report on 
page 27.
COMMUNITY SUPPORT
Our policy is to support the local communities in 
areas in which we operate and to make a positive
contribution to both charitable and recreational
activities in communities close to each of our branch
operations.
In the last year, we have renewed the licence for the
ﬁshing club on our lakes in Sandy in Bedfordshire, and
a number of requests have been satisﬁed for free car
parking on our sites for charity and recreational sports
events. The Group continues to support the Police and
Fire Services donating vehicles for training purposes.
Our land at Redbourn in Hertfordshire was used again
this year by the Steam Owners and Drivers Club for
their annual rally.
CHARITABLE DONATIONS
The Group and its employees aim to support local,
national and international charity appeals, especially
when a staff member is actively involved in
fundraising.
In 2005/2006 our ‘dress down’ Friday’s charity
collection, one-off theme days, auctions and appeal
collections have raised over £15,000. We are proud that
we raised, through the efforts of employees, customers,
shareholders and advisors a sum in excess of £12,000
for the BBC Children in Need Appeal.
Staff at our branches have regularly raised funds for
local charities and those we have supported this year
include:
•
BBC Children in Need Appeal
•
Marie Curie Cancer Care
•
Keech Cottage Children’s Hospice (Luton)
•
Cancer Research UK
•
Sue Ryder Care
•
Strathcarron Hospice, Denny
•
Denny Rotary Club
Anne E Lister
Company Secretary
24 July 2006
Corporate Social Responsibility Statement
CONTINUED 15 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
The Directors present their annual report, together with the audited
ﬁnancial statements, for the 52 weeks to 29 April 2006.
BUSINESS REVIEW AND PRINCIPAL ACTIVITIES
The Group is a leading service provider to the UK motor insurance 
and automotive industries, specialising in the disposal of accident-
damaged, End-of-Life and low-value, fee-based non-salvage vehicles.
The Group owns eight sites across the UK and operates from seven,
with the eighth let to a third party. The main income generating
activity is the selling of accident-damaged vehicles through Internet
and physical auctions. Vehicles are both purchased outright from
clients and sold at the Group’s risk, or the sale is transacted on a 
fee basis with the risk in the vehicle’s re-sale price residing with the
clients. Income is also generated from scrap metal by depolluting,
crushing and selling vehicles which have no resale value.
BUSINESS ENVIRONMENT
The UK salvage marketplace is highly fragmented and comprises 
many small owner-managed businesses, very many of which were
started some decades ago when obtaining planning permission to 
run a salvage site was signiﬁcantly easier. The Group is the only UK
listed salvage operator and is by some distance the largest salvage
business under single management. Its competitors operate either as
standalone businesses, or as members of two main consortia, namely
National Salvage Group (‘NSG’) and Nationwide Auto Salvage
Amalgamation (‘NASA’).
There are very few salvage companies operating from more than 
one site and consequently not many can realistically offer a national
service without joining one of the main consortia.
The core customer base is from within the UK motor insurance
industry. This industry has consolidated signiﬁcantly during the 
last twenty years and with the emergence of the Internet, the
predominant business model has moved from broker-based sales 
to direct-to-consumer sales. Following the period of consolidation,
well over 80% of the motor insurance market is now controlled by 
the top ten motor insurers. Contracts to provide salvage services are
usually put out to tender and competition is ﬁerce for those tender
opportunities that arise. Price appears to be the single most important
element of the buying decision in the majority of cases. This is
undoubtedly due to the price competitive nature of the motor
insurance marketplace.
STRATEGY
The Group’s focus in the last two years has been on implementing its
Business Turnaround Plan. This plan was written and activated in the
spring/summer of 2004 and it laid out the core strategic thrust of the
Group over the ensuing three year period. On the back of this plan,
the Group agreed new banking facilities with its bank, The Royal Bank
of Scotland plc. The overriding requirement of the plan was, in the ﬁrst
instance, to reduce operating costs and debt levels and in the second
instance, to re-invigorate organic growth within its core markets.
Cost and debt reduction has mainly been achieved through site
consolidation and sale, with some cost reductions in bought-in 
goods and services also contributing to the lower operating cost 
base. The majority of the restructuring activity has been completed.
The main focus going forward is now on revenue growth, to which 
end a new sales and marketing approach has been brought to the
business following the appointment of A Palmer-Baunack initially as
Managing Director, now Chief Executive. This approach, which involves
relationship building and proactive marketing initiatives amongst
other elements, has resulted in several new contract awards
throughout 2005 and 2006.
Looking forward, as the Group enters the third year of its three year
Business Turnaround Plan, the business is well positioned to leverage
on its market position and strong balance sheet. A strategy will be
pursued based on organic growth in the core salvage service in the 
UK motor insurance market, as well as new related services in the
automotive ﬂeet market, along with carefully targeted acquisition
opportunities.
FUTURE OUTLOOK
The salvage industry remains highly competitive. However, there is 
a strong possibility with many salvage company owners approaching
normal retirement age, that there is likely to be a period of change 
in the industry. Whilst this will take some time to have a signiﬁcant
impact on the overall structure of the industry, it does offer a
consolidation opportunity for the larger players in the market. In the
meantime, the Group will continue to focus on driving forward sales
growth whilst maintaining a tight control over operating costs. The
Group has a high level of ﬁxed costs and whilst it has spare capacity,
incremental volumes will lead to improved proﬁtability.
PRINCIPAL RISKS AND UNCERTAINTIES
The management of the business and the execution of the Group’s
strategy are subject to a number of risks.
The key business risks affecting the Group are set out below:
Management
The Group has had many changes in its senior management structure
over the last three years. This has resulted in disruption to the
business and a lack of continuity. It is likely that any changes to
certain key senior managers in the near future would have a
signiﬁcant impact on the Group’s ability to improve its ﬁnancial
performance. The Board is taking steps to ensure that the
management team is appropriately rewarded for its efforts.
Consolidation in salvage marketplace
Any material changes in the ownership structure of the salvage market
could have a major impact on the Group’s current dominant market
position.
Consolidation in UK motor insurance marketplace
Further consolidation in the UK motor insurance marketplace 
might put current salvage relationships and contracts at risk. The
management team is working closely with its customers to create
strong partnership arrangements and is continuing to build close
relationships outside its existing customer base.
Directors’ Report 16 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Directors’ Report
CONTINUED
PRINCIPAL RISKS AND UNCERTAINTIES CONTINUED
Environmental risks
The main environmental risks within our business are land, water and
ﬁre pollution as a result of the operations we carry out during the
daily carriage, storage, auction and on-site depollution and
dismantling of vehicles.
These are managed by operating a rigid risk management programme
which is fully compliant with the requirements of the regulatory
bodies that cover the terms of our site licences. Regular audits are
carried out by Government agency ofﬁcers to monitor our compliance
with the terms of our licences.
In addition to our own in-house audits and best working practices,
we also use external consultants and contractors to provide
professional and independent audits. We have contracts in place 
with them to maintain the infrastructure of our sites including all
equipment thereon that ensures we do not pollute the land and water
and prevent the risk of ﬁre as a result of our business operations.
Acquisitions
The ability to identify and execute a successful acquisition strategy
which is earnings accretive depends on the opportunities that exist 
in the relevant marketplace.
KEY PERFORMANCE INDICATORS (‘KPI’s’)
The Group relies on many different KPI’s at an operational level 
which are speciﬁc to the business and which are used by the
management team to monitor performance on a daily, weekly 
and monthly basis.
At Board level, due to the recent difﬁcult ﬁnancial position of the
Group, the key area of focus has been on the ﬁnancial performance.
The table below shows the main business KPI’s used to measure the
Group’s progression in its Business Turnaround Plan.
KEY PERFORMANCE INDICATORS 2006 2005 DEFINITION, METHOD OF CALCULATION AND ANALYSIS
Increase/(decrease) in number of units disposed of (% change) 0.4% 15.3% Percentage change in total volumes disposed of.
The increase in 2005 over 2004 was driven by growth
in all three business areas. In 2006, the growth in
salvage units was offset by the loss of Yes Car Credit.
Increase/(decrease) in gross margin value (£m) £0.7m £1.2m Year-on-year change in the total value of gross
margin, driven by incremental volumes and strong
scrap pricing.
(Increase)/decrease in administration expenses (£m) £1.1m £1.8m Year-on-year change in administration expenses
being the net result of cost saving initiatives. Site
consolidation and reduction in depreciation charges
are the main drivers.
EBITDA (£m) £2.6m £1.2m Earnings before exceptional items, interest, tax,
depreciation and amortisation. The increase in
EBITDA reﬂects the improved value generation
following restructuring.
Interest cover (times) 2.2 (1.8) Operating proﬁt before interest and exceptionals
divided by the net interest charge before
exceptionals. The Group is now proﬁtable and can
afford to service more debt, if appropriate.
Gearing (%) 27.1% 39.5% Net debt divided by closing shareholders’ funds,
expressed as a percentage. The reduction is due
mainly to the sale of non-core properties, plus the
improved trading performance.
Return on shareholders’ funds (%) 3.1% (10.2%) Pre-exceptional proﬁt before tax divided by the
average of the opening and closing shareholders’
funds. The increase reﬂects better use of the Group’s
assets along with the return to proﬁtability. 17 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
DIVIDENDS AND TRANSFERS TO RESERVES
The proﬁt attributable to shareholders for the year amounted to 
£0.7 million (2005: loss of £1.6 million). No interim dividend was 
paid this year (2005: nil pence). The Directors have decided against
payment of a ﬁnal dividend for the year (2005: nil pence). The total
dividend for the year is therefore nil pence (2005: nil pence) per
Ordinary share of 10 pence each in the capital of the Company
(‘Ordinary share’), being £nil (2005: £nil).
The retained proﬁt of £0.7 million (2005: loss of £1.6 million) has
been transferred to reserves.
DIRECTORS
N C Stead was appointed to the Board as Non-executive Director 
on 1 March 2006 and R B Mead was appointed to the Board 
as Non-executive Director on 18 April 2006. The biographies of 
the current Directors are set out on pages 2 and 3. Details of 
the Directors’ service agreements, emoluments and share interests 
are to be found in the Report on Directors’ Remuneration on 
pages 18 to 23.
In accordance with the Company’s Articles of Association,
N C Stead and R B Mead will retire from ofﬁce at the forthcoming
Annual General Meeting (‘AGM’) and will be proposed for election.
A N Foster and A F Somerville will retire by rotation in accordance
with the Company’s Articles of Association who, being eligible,
will be proposed for re-election.
The Chairman, at the request of the Board, agreed to renew his service
contract on 1 January 2006 for a further year in order to provide
continuity following recent Board changes.
The Directors’ interests in the share capital of the Company were 
as follows:
AT 29 APRIL 2006 AT 30 APRIL 2005
10 PENCE 10 PENCE
ORDINARY SHARES ORDINARY SHARES
(NUMBER) (NUMBER)
A N Foster 142,500 142,500
N S Terry 50,000 70,000
N C Stead – –
R B Mead – –
A Palmer-Baunack 9,000 –
A F Somerville – –
The above interests are all beneﬁcially held, except 14,500 Ordinary
shares of A N Foster’s holding. There have been no changes in
Directors’ shareholdings since the year-end.
SUBSTANTIAL SHAREHOLDINGS
As at 24 July 2006 no employees of the Group had a substantial
interest (including non-beneﬁcial interests) in the Ordinary shares 
of the Company.
The Company had been notiﬁed of the following holdings of over 
3% in the Company’s share capital at the date of going to print:
NUMBER OF ORDINARY SHARES
Artemis Investment Management Limited 4,324,010
C S Bassett 2,812,192
S S Bassett 2,455,080
J A Sutton 2,355,080
Canada Life Group of Companies 1,525,000
Impax Environmental Markets plc 913,750
DONATIONS
During the year the Group has paid £1,300 (2005: £3,200) in charitable
contributions. No political donations were made. Further information on
the Company’s charitable activities and its role in the community is
contained in the Corporate Social Responsibility Statement on page 14.
CREDITORS’ PAYMENT POLICY
The policy of the Group is to pay suppliers in accordance with the
terms of trade agreed with each supplier and, in the absence of an
agreement, on or before the end of the succeeding month. The
average period of credit given by suppliers is 27 days (2005: 27 days).
The Company has no trade creditors (2005: £nil).
EMPLOYEES
Policies in respect of employment, training and career development
are described in the Corporate Social Responsibility Statement on
page 12.
AUDITORS
So far as the Directors are aware, there is no relevant audit information
of which the Group’s auditors are unaware and the Directors have
taken all the steps that ought to have been taken as Directors in order
to make themselves aware of any relevant audit information and to
establish that the Group’s auditors are aware of that information.
PricewaterhouseCoopers LLP have expressed a willingness to continue
in ofﬁce as auditors of the Company and a resolution to reappoint
them will be proposed at the AGM.
GOING CONCERN
The Directors consider that, after making appropriate enquiries and 
at the time of approving these ﬁnancial statements, the Group has
adequate resources to continue in operational existence for the
foreseeable future. The Directors therefore continue to adopt the
going concern basis in preparing these ﬁnancial statements.
By Order of the Board
Anne E Lister
Company Secretary
24 July 2006 18 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
(This part of the Report on Directors’ Remuneration is not required to be audited.)
This report has been prepared by the Remuneration Committee on behalf of the Board for submission to shareholders. The Remuneration
Committee consists of the four Non-executive Directors, A N Foster, N C Stead, R B Mead and is chaired by N S Terry. A Palmer-Baunack is
invited by the Committee to discuss speciﬁc issues. It meets as necessary and the Committee met on nine occasions in the ﬁnancial year.
A resolution approving the Report on Directors’ Remuneration will be proposed at the forthcoming Annual General Meeting (‘AGM’).
REMUNERATION COMMITTEE RESPONSIBILITIES
(This part of the Report on Directors’ Remuneration is not required to be audited.)
The Committee has a primary responsibility to review the performance of the Executive Directors and senior employees and to set their
remuneration and other terms of employment. The Group’s framework for executive remuneration is:
•
setting and monitoring the remuneration policies applied in the Group, having regard to relevant market comparisons and practice;
•
considering and determining the remuneration arrangements (including bonuses, pension rights, service contracts and compensation
payments) of Executive Directors of the Company. Its approach is consistent with the Group’s overall philosophy that all staff should 
be competitively rewarded taking into account relevant experience, personal performance, sector comparison and the size of the Group;
•
considering and determining the remuneration arrangements (including bonuses, pension rights, service contracts and compensation
payments) of senior executives of the Group;
•
ensuring that the remuneration policy and the Group’s practices for Executive Directors facilitate the employment and motivation of 
top quality personnel and adequately reward individual contribution made to the Group, while at the same time remaining appropriate 
in terms of the Group’s performance;
•
seeking advice from independent remuneration consultants for the purpose of establishing the Group’s market position or exploring
particular aspects of remuneration such as bonus arrangements; and 
•
monitoring the Group’s employee share schemes and determining within the overall remuneration policy the level of options or awards
under such schemes and the performance targets therein.
REMUNERATION POLICY
(This part of the Report on Directors’ Remuneration is not required to be audited.)
The Group has given full consideration to the principles of, and has complied with, The Combined Code on Directors’ remuneration. The policy 
of the Group for the remuneration of Executive Directors and other senior management is that it should be adequate to attract, motivate and
retain personnel of the highest calibre.
INDIVIDUAL DIRECTOR’S REMUNERATION
(This part of the Report on Directors’ Remuneration is required to be audited.)
SALARIES BENEFITS 2006 2005
AND FEES IN KIND
1
BONUS TOTAL TOTAL 
£000 £000 £000 £000 £000
Non-executive Chairman:
A N Foster 38 – – 38 35
Executive Directors:
A Palmer-Baunack 155 2 68 225 26
A F Somerville 134 2 56 192 160
Former Executive Directors – – – – 526
Non-executive Directors:
E P Bruegger
2
28–– 28 48
N S Terry 30 – – 30 30
N C Stead
3
5–– 5 –
R B Mead
4
1–– 1 –
Total 391 4 124 519 825
Report on Directors’ Remuneration 19 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
INDIVIDUAL DIRECTOR’S REMUNERATION CONTINUED
NOTES
1
Beneﬁts in kind consist of car fuel and private health cover. The reimbursement of Directors expenses is consistent with Company policy, being 
claimed and reimbursed as incurred.
2
The remuneration of E P Bruegger is in respect of the period from 1 May 2005 to 6 January 2006, when he resigned as a Director of the Company.
3
The remuneration of N C Stead is in respect of the period from his appointment to the Board on 1 March 2006 to 29 April 2006.
4
The remuneration of R B Mead is in respect of the period from his appointment to the Board on 18 April 2006 to 29 April 2006.
REMUNERATION PACKAGES
(This part of the Report on Directors’ Remuneration is not required to be audited.)
Individual salary, bonus and beneﬁt levels for Executive Directors and other senior executives are reviewed annually by the Remuneration
Committee and are determined by reference to a range of criteria, including:
•
personal performance;
•
level of responsibility;
•
the performance of the Group relative to its competitors;
•
the practice of other listed companies, in particular those operating in service sectors; and 
•
the appropriate mix between short and long-term incentives.
The remuneration packages for Executive Directors comprise short-term and longer-term beneﬁts and share options. During the year,
the Remuneration Committee took advice from the Group’s Company Secretarial and Human Resources functions, and New Bridge Street
Consultants LLP.
Short-term beneﬁts comprise annual salary, provision of car allowance and fuel, life assurance, permanent health insurance, medical expenses
insurance and an annual proﬁt and performance related bonus. A bonus has been earned by Executive Directors in the year under the terms of
the existing scheme and this is detailed in the table on page 18.
The targeted composition of each Director’s remuneration is as follows:
NON-PERFORMANCE PERFORMANCE
RELATED RELATED
A N Foster 100% 0%
E P Bruegger 100% 0%
N S Terry 100% 0%
N C Stead 100% 0%
R B Mead 100% 0%
A Palmer-Baunack 73% 27%
A F Somerville 74% 26%
This is based on the assumption that the Group achieves its budgeted proﬁt before tax target.
The Non-executive Directors’ fees are determined by the Board without the Non-executive Directors being present.
SHARE AWARDS
(This part of the Report on Directors’ Remuneration is not required to be audited.)
The Board is seeking shareholders’ approval at the 2006 AGM to make the following one-off share awards (‘the Awards’) to the Company’s
Executive Directors.
An Award of 150,000 shares will be made to A Palmer-Baunack and 100,000 shares to A F Somerville.
As set out in more detail in the explanatory notes to the Notice of Annual General Meeting, one-sixth of the Awards will vest at the date of
grant to reﬂect the Executive Directors’ contribution to date in delivering the Business Turnaround Plan. The vesting of the remainder of the
Awards will be triggered in full only if stretching earnings per share (‘EPS’) performance targets are met. 20 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
SHARE AWARDS CONTINUED
These Awards are intended to incentivise the Executive Directors to produce performance that supports the achievement of the Business
Turnaround Plan and ensure that, over the long-term, the interests of the Executive Directors will be even more closely aligned with
shareholders’ interests.
Other than these Awards, the Remuneration Committee’s intention is that the Executive Directors will not receive Awards under any other
discretionary share plan in the next twelve months.
THE UNIVERSAL SALVAGE PLC 2000 EMPLOYEES’ SHARE TRUST (THE ‘TRUST’)
(This part of the Report on Directors’ Remuneration is not required to be audited.)
The Board has made the decision to satisfy the Awards from the shares held by the Trust. Any options exercised will be satisﬁed by a new issue
of shares by the Company.
SHARE OPTION SCHEMES
(This part of the Report on Directors’ Remuneration is not required to be audited.)
The Company presently has two employee share option schemes. The Universal Salvage plc Inland Revenue Approved Company Share Plan 2004
(the ‘New Approved Plan’), and the Universal Salvage plc Non-Inland Revenue Approved Share Option Plan 2004 (‘the New Unapproved Plan’).
The Company’s 2000 Approved Executive Share Option Scheme and 1995 Share Option Scheme terminated in March 2005. The Company’s
1995 Savings-Related Share Option Scheme terminated in August 2005 and options can no longer be granted from these schemes.
It is the intention of the Remuneration Committee to grant share options annually to Executive Directors and senior managers to reward past
performance and incentivise future performance. Such options require that future performance targets are met before they can be exercised.
The same performance targets, which are based on either the growth in EPS on ordinary activities or EBIT and cash ﬂow targets derived from 
the Group’s business plan, are common to all Executive Directors and senior managers, regardless of their differing roles in the Group, on the
basis that the Board’s key objective is to increase shareholder value through growth in earnings. Performance targets are set at the time of 
grant of options. These targets are set with a view to maximising shareholder return whilst adequately rewarding and motivating executives.
Option shares are not granted at a discount. However, the new Awards will be granted at a discount.
The speciﬁc share option performance targets applicable to the New Approved and New Unapproved Schemes are as follows:
Targets applicable to options granted on 29 July 2004 in the 1995 Unapproved Scheme:
This performance target was designed speciﬁcally to take account of the business being in a turnaround situation and was agreed in advance 
of the Awards being granted with the Association of British Insurers (‘the ABI’). In respect of the stock option awards granted in July 2004, the
following performance conditions are set for the three periods being ﬁnancial years 2005 to 2007 inclusive and there are two vesting elements
each of which is independent of the other:
•
50% of the total award vests based on cumulative EBIT achieved and 50% of the total award vests based on cumulative cash ﬂow achieved.
•
There are three levels of award. At ‘Entry’ levels 30% of the award vests, at ‘Target’ levels 50% of the award vests, at ‘Maximum’ levels 100%
of the award vests.
•
The ‘Target’ levels of awards have been set broadly in line with those set out in the Business Plan in respect of EBIT and cash ﬂow
respectively.
•
Where cumulative EBIT or cash ﬂow is lower than that at the ‘Entry’ levels in respect of EBIT and cash ﬂow respectively, no element of that
part of the award will vest.
•
Where cumulative EBIT or cash ﬂow is between the ‘Entry’ and ‘Target’ levels of achievement or ‘Target’ and ‘Maximum’, the levels of award
vesting will be calculated on a straight-line basis between the two relevant vesting percentages.
•
The reason for allowing vesting of the award below ‘Target’ performance is in recognition of the difﬁculty of achieving levels of EBIT and
cash ﬂow as set out in the Business Plan.
It is noted that the performance conditions set out above were calculated on UK GAAP. The Company has adopted IFRS for the 52 weeks to 
29 April 2006 and will report ﬁgures on this basis in future ﬁnancial periods. If the EBIT or cash ﬂow reported under IFRS is materially different
compared to UK GAAP, the Remuneration Committee may consider appropriate adjustments to reﬂect their intentions at the date of the award.
Report on Directors’ Remuneration
CONTINUED 21 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
SHARE OPTION SCHEMES CONTINUED
The deﬁnition of EBIT and cash ﬂow are as follows:
•
EBIT: earnings before interest, tax and exceptional items, and
•
Cash ﬂow: cash ﬂow before ﬁnancing and the management of liquid resources, as set out in Financial Reporting Standard 1 (revised 1996),
Cash Flow Statements, and further, before any dividends paid by the Group and proceeds from the disposal of Redbourn, Denny and 
BB & EA (part of Sandy).
Target applicable to all other options granted in the 1995 Unapproved Scheme:
•
If percentage growth in the adjusted EPS in the period of three consecutive years immediately preceding the date of exercise exceeds the
percentage growth in RPI by 9.27% over that period 100% of the option shares may be exercised.
The opinion of the Remuneration Committee as to whether and the extent to which the performance target is fulﬁlled at any time in relation 
to any option shall be ﬁnal and binding on the option holder.
Target applicable to all options granted in the 2000 Approved Scheme:
•
If growth in the adjusted EPS in the period of three consecutive years beginning with that in which the option is granted exceeds the
percentage growth in RPI by 9.27% over that period 100% of the option shares may be exercised.
The opinion of the Remuneration Committee as to whether and the extent to which the performance target is fulﬁlled at any time in relation 
to any option shall be ﬁnal and binding on the option holder.
Target applicable to options granted on 22 July 2005 in the 2004 New Approved and 2004 New Unapproved Schemes:
This performance target was designed speciﬁcally to take account of the business being in a turnaround situation and was agreed in advance
with the ABI. In respect of the stock option awards granted in July 2005, the following performance conditions are set for the three periods 
being ﬁnancial years 2006 to 2008 inclusive and there are two vesting elements each of which is independent of the other:
•
50% of the total awards vests based on cumulative EBIT achieved and 50% of the total award vests based on cumulative cash ﬂow
achieved.
•
There are two levels of award. At ‘Entry’ levels 50% of the award vests, at ‘Target’ levels 100% of the award vests.
•
The ‘Target’ levels of awards have been set broadly in line with those set out in the Business Plan in respect of EBIT and cash ﬂow
respectively.
•
Where cumulative EBIT or cash ﬂow is lower than that at the ‘Entry’ levels in respect of EBIT and cash ﬂow respectively, no element of that
part of the award will vest.
•
Where cumulative EBIT or cash ﬂow is between the ‘Entry’ and ‘Target’ levels of achievement, the levels of award vesting will be calculated
on a straight-line basis between the two vesting percentages.
•
The reason for allowing vesting of the award below ‘Target’ performance is in recognition of the difﬁculty of achieving levels of EBIT and
cash ﬂow as set out in the Business Plan.
It is noted that the performance conditions set out above were calculated on UK GAAP. The Company has adopted IFRS for the 52 weeks to 
29 April 2006 and will report ﬁgures on this basis in future ﬁnancial periods. If the EBIT or cash ﬂow reported under IFRS is materially different
compared to UK GAAP, the Remuneration Committee may consider appropriate adjustments to reﬂect their intentions at the date of the award.
The deﬁnition of EBIT and cash ﬂow are as follows:
•
EBIT: earnings before interest, tax and exceptional items, and
•
Cash ﬂow: cash ﬂow before ﬁnancing and the management of liquid resources, as set out in Financial Reporting Standard 1 (revised 1996),
Cash Flow Statements, and further, before any dividends paid by the Group and proceeds from the disposal of Group properties including
Denny and Corby. 22 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
EXECUTIVE SHARE OPTION SCHEME
(This part of the Report on Directors’ Remuneration is required to be audited.)
Share options over Ordinary 10 pence shares have been granted to a number of Directors and other employees at the market value at the time
of the grant. Details of the options granted to Directors and the movement thereon are shown in the table below:
1 MAY 2005 GRANTED EXERCISED LAPSED
OR DATE OF DURING DURING DURING EXERCISE EXERCISE EXERCISE
DIRECTORS AT DATE OF APPOINTMENT YEAR YEAR YEAR 29 APRIL 2006 PRICE DATES DATES
29 APRIL 2006 GRANT (NUMBER) (NUMBER) (NUMBER) (NUMBER) (NUMBER) (PENCE) EARLIEST LATEST
A Palmer-Baunack 22.07.2005 – 31,914 – – 31,914 94.0 22.07.2008 22.07.2015
22.07.2005 – 218,086 – – 218,086 94.0 22.07.2008 22.07.2015
A F Somerville 09.04.2003 20,298––– 20,298 101.0 09.04.2006 09.04.2010
09.04.2003 29,702––– 29,702 101.0 09.04.2006 08.04.2013
22.07.2005 – 50,000 – – 50,000 94.0 22.07.2008 22.07.2015
The options in respect of the 1995 Unapproved Scheme can be exercised between three and seven years from the date of grant. The options in
respect of the 2000 Approved, 2004 New Approved and 2004 New Unapproved Schemes can be exercised between three and ten years from the
date of grant.
The middle market price of the Company’s shares on 28 April 2006 was 125.0 pence. The highest price in the year was 139.0 pence and the
lowest price was 74.5 pence.
DIRECTORS’ SERVICE AGREEMENTS
(This part of the Report on Directors’ Remuneration is not required to be audited.)
The Directors’ service agreements can be summarised as follows:
CONTRACTUAL
CONTRACT TERMINATION NOTICE 
DATE PAYMENT PERIOD
A N Foster 29.11.2005 3 months 3 months
E P Bruegger 23.04.2003 3 months 3 months
N S Terry 01.09.2003 3 months 3 months
N C Stead 01.03.2006 3 months 3 months
R B Mead 18.04.2006 3 months 3 months
A Palmer-Baunack 01.03.2005 12 months 12 months
A F Somerville 23.04.2003 12 months 12 months
The Non-executive Directors are appointed for a three year term, which may only be terminated on three months’ notice.
A N Foster’s service agreement is for a period of one year and expires on 31 December 2006.
A Palmer-Baunack and A F Somerville’s service agreements have been extended to twelve month notice periods in order to recognise the
importance of providing continuity for the business and to match terms and conditions of employment within the marketplace for public
company directors.
E P Bruegger resigned on 6 January 2006.
PENSIONS
(This part of the Report on Directors’ Remuneration is required to be audited.)
The Company contributes a percentage (normally 10%) of salary to an individual deﬁned contribution pension fund established for each Executive
Director.
Report on Directors’ Remuneration
CONTINUED 23 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
PENSIONS CONTINUED
During the 52 weeks to 29 April 2006 the following contributions were made:
2006 PENSION 2005 PENSION 
CONTRIBUTIONS CONTRIBUTIONS
£000 £000
A Palmer-Baunack 14 2
A F Somerville 12 12
Former Executive Directors – 23
Total 26 37
FEES
(This part of the Report on Directors’ Remuneration is not required to be audited.)
The fees for Non-executive Directors are determined by the Board and are paid in cash and not shares.
TOTAL SHAREHOLDER RETURN FOR THE PREVIOUS FIVE YEARS, COMPARED TO THE SUPPORT SERVICES SECTOR
(This part of the Report on Directors’ Remuneration is not required to be audited.)
The graph above shows the total shareholder return of Universal Salvage plc relative to the total shareholder return of the FTSE Support Services
sector re-based from May 2001 up to January 2006 and, from then on, relative to the performance of the FTSE All Share Support Services sector.
The FTSE Global Classiﬁcation System was replaced at the end of 2005 with the FTSE/Dow Jones Industrial Classiﬁcation Benchmark (‘ICB’).
As a result of this, all of the FTSE Indices were converted to ICB on 2 January 2006. Over the ﬁve year period the Company has provided a total
shareholder loss of 61% (2005: loss of 67%) compared to a total shareholder loss provided by the FTSE All Share Support Services sector of 6%
(2005: loss of 32%). In the opinion of the Directors, the FTSE All Share Support Services sector is the index against which the total shareholder
return of Universal Salvage plc should be measured as the Company is listed within the Support Services sector on the London Stock Exchange.
On behalf of the Board 
Nigel S Terry
Chairman of the Remuneration Committee
24 July 2006
Value of £100 invested in May 2001
Universal Salvage plc – Total Return Index
FTSE Support Services – Total Return Index Source: Datastream
0
100
120
140
160
2001 2002 2003 2004 2005 2006
20 
80
60
40 24 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
INTRODUCTION
The Board continues its commitment to maintaining high standards of corporate governance and is responsible for the systems and procedures by 
which the Group is directed and controlled. The Board recognises the importance of adopting appropriate corporate governance practices throughout the
Company and the Directors believe that they govern the Group in the best interests of the shareholders, whilst taking into account the interests of other
stakeholders in the Group, in particular customers and employees.
COMPLIANCE
Universal has applied the principles and supporting principles contained in The Combined Code on Corporate Governance (‘the Code’) during the year 
and this report describes where Universal has complied with the Code’s provisions.
The Board considers that the Company substantially complies with the Code’s provisions as set out on pages 28 to 31.
THE BOARD 
Role and Composition
The Board currently comprises the Non-executive Chairman, the Chief Executive, the Group Finance Director and three other Non-executive Directors.
The majority of the Non-executive Directors meet the criteria for independence as set out in the Code and are therefore considered by the Board to be
independent. The only exception to this is N S Terry, Non-executive Director, who is recognised by the Board as representing the interests of the Bassett
family, a major shareholder in the Company.
The Directors’ biographies, which show other signiﬁcant commitments (if any), are set out on pages 2 and 3.
The Board’s principal focus is the overall strategic direction, development and control of the Group. In support of this the Board approves the Group’s
values, business practice policies, strategic plans, annual budget, signiﬁcant capital expenditure and the Group’s overall system of internal controls,
governance and compliance. It also has oversight and control of the Group’s operating and ﬁnancial performance. These responsibilities are set out 
in a formal statement of the Board’s role.
The Board met fourteen times throughout the ﬁnancial year. The standard Board cycle is eleven times a year, with additional meetings as required.
The key function of the Chairman is to conduct Board meetings and to ensure that the Board is kept properly informed, is consulted on all issues 
reserved to it and that its decisions are made in a timely and considered way to enable the Directors to fulﬁl their ﬁduciary duty.
The Chairman discloses to the Board any changes to his signiﬁcant commitments as they arise.
The Chairman also conducts shareholder meetings and ensures that the views of the shareholders are known to the Board and considered appropriately.
The Chief Executive has executive responsibility for the success of the Group and is required to develop and lead business strategies and processes 
to enable the Group to meet its strategic objectives and the requirements of its stakeholders.
It is the Board’s policy that Executive Directors may not take up more than one Non-executive Directorship. No Executive Director presently serves 
as a Non-executive Director of any other company.
The Company Secretary manages the provision of timely, accurate and considered information to the Board for its meetings. The Company Secretary
recommends to the Chairman for Board consideration, where appropriate, the Company’s corporate governance policies and practices and is responsible
for their communication and implementation. It is also the responsibility of the Company Secretary to ensure appropriate insurance cover is maintained
in respect of legal actions against Directors. The current level of cover is £5 million. The appointment and removal of the Company Secretary is a matter
for the whole Board.
The Non-executive Directors provide a strong independent element on the Board and between them provide extensive knowledge, experience and
independent judgement. Their key skills include signiﬁcant experience of the insurance industry, the automotive industry, corporate ﬁnance, investment
banking, sales and procurement as well as business operations and strategy.
Non-executive Directors are appointed initially for three years, subject to three months’ termination notice from either the Company or the Director.
At the end of the ﬁrst three years the appointment may be continued by mutual agreement.
Each Non-executive Director is provided, upon appointment, with a letter setting out the terms of his or her appointment including membership of 
Board committees, the fees to be paid and the time commitment expected from the Director. The letter also covers such matters as the conﬁdentiality 
of information.
Corporate Governance 25 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
APPOINTMENTS TO THE BOARD
The Board appointed two new Non-executive Directors in the year. The Nomination Committee debated and agreed the skill set and attributes required
of the candidates, which were endorsed by the Board. An external search consultant was appointed, who advertised the posts in the national press, and
selected candidates according to the criteria set by the Nomination Committee. The Chairman and the Non-executive Directors interviewed short listed
candidates.
The Board appointed the Chairman for a further one year term commencing on 1 January 2006 in order to provide continuity following recent Board
changes.
ELECTION AND RE-ELECTION
All Directors are required by the Company’s Articles of Association to be elected by shareholders at the ﬁrst AGM after their appointment, if appointed 
by the Board. A Director must subsequently retire by rotation at an AGM at intervals of not more than three years. The Director may seek re-election.
SERVICE AGREEMENTS
The Chairman, Non-executive Directors and Executive Directors have service agreements, which are approved by the Remuneration Committee.
Information about the duration of these agreements is contained in the Report on Directors’ Remuneration on page 22.
INDEPENDENT ADVICE
The Board has a procedure for Directors, in furtherance of their duties, to take independent professional advice if necessary, at the Company’s expense.
In addition, all Directors have access to the advice and services of the Company Secretary.
Where Directors have concerns, which cannot be resolved about the running of the Company or a proposed action, these concerns are recorded in the
Board minutes. It is the policy of the Company that if a Director resigns as a result of any concerns these are provided in a written statement to the
Chairman for circulation to the Board.
MEETINGS ATTENDANCE
The number of Board and Committee meetings attended by each of the Directors during the year was as follows:
FULL REMUNERATION AUDIT NOMINATION 
DIRECTORS BOARD COMMITTEE COMMITTEE COMMITTEE
A N Foster 13 9 2 3
E P Bruegger 7
1 
322
N S Terry 13 9 2 3
N C Stead 3
1  
–––
R B Mead 1
1 
1––
A Palmer-Baunack 14 4
2 
2–
A F Somerville 14 1
2
2–
Total number of meetings held in the year 14 9 2 3
NOTES
1 
There have been three Board meetings since the appointment of N C Stead and one Board meeting since the appointment of R B Mead. E P Bruegger resigned     
during the year.
2 
A Palmer-Baunack and A F Somerville attend by invitation to assist the Committee as required.
COMMITTEES
Board Committees
Copies of the terms of reference for all the Board Committees can be found on the Company’s website www.universal-services.co.uk or are available
from the Company Secretary by request.
Remuneration Committee
The Remuneration Committee is comprised entirely of the Non-executive Directors and N S Terry chairs the Committee. The Committee has
responsibility on behalf of the Board for the determination of the framework and broad policy for the remuneration of the Executive Directors and senior
managers. This includes the contract terms, remuneration, performance related bonus schemes, pension rights, compensation payments and other
beneﬁts for each of the Executive Directors and senior management. The Board as a whole determines the remuneration of the Non-executive Directors
on an annual basis. The Committee meets as required and met nine times in the year. Further details are contained in the Report on Directors’
Remuneration on pages 18 to 23. 26 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Corporate Governance
CONTINUED
COMMITTEES CONTINUED
Nomination Committee
The Nomination Committee is comprised entirely of the Non-executive Directors and is chaired by A N Foster. The Nomination Committee’s principal
functions are to review the size, structure and composition of the Board, the membership of Board Committees and the succession plans for the
Executive Directors. The Committee met three times in the year and is responsible for the selection and approval of candidates for appointment 
to the Board. The Committee will meet at least twice a year and at such other times as the Chairman of the Committee shall require.
Audit Committee
The Audit Committee is comprised entirely of the Non-executive Directors and R B Mead was appointed Chairman of the Audit Committee on his
appointment to the Board on 18 April 2006. E P Bruegger chaired the Audit Committee until his resignation on 6 January 2006.
The Nomination Committee considers that the Audit Committee’s members have the recent and relevant ﬁnancial experiences required to satisfy the
provisions of the Code. External training and courses are attended as required and update sessions are provided by the Company’s auditors on matters
such as IFRS and its impact on the Group.
The Audit Committee is responsible for advising the Board on the appointment, reappointment and removal of the external auditors. It ensures that key
partners are rotated at appropriate intervals. It discusses and reviews the scope of the audit with the auditors, reviews the results and reports the results
of the review to the Board. The Committee recommends to the Board appropriate remuneration for the auditors.
The Audit Committee reviews and monitors the extent of non-audit work undertaken by the auditors and approves all such work before it is undertaken.
The Audit Committee reviews all services being provided by the external auditors on a regular basis to ensure the independence and objectivity of 
the external auditors, taking into consideration relevant professional and regulatory requirements, so that these are not impaired by the provision 
of permissible non-audit services.
The Audit Committee monitors and reviews the Group’s risk management procedures and internal control measures, the effectiveness of internal control,
ﬁnancial reporting, the Group’s accounting policies and procedures and the Company’s statements on internal control before being agreed by the Board
for each year’s Annual Report and Accounts.
The Audit Committee will review the arrangements for dealing with any reports under the Company’s whistleblowing policy from employees with regard
to accounting or ﬁnancial improprieties, fraud and other matters.
The Group Finance Director, the Company Secretary and the Company’s external auditors attend the Committee’s meetings. The Committee met twice 
in total during the ﬁnancial year.
INTERNAL CONTROL AND RISK MANAGEMENT
The Board is responsible for the Group’s systems of internal control and risk management and for reviewing the effectiveness of those systems.
The systems are intended to manage, rather than eliminate the risk of failure to meet business objectives and can only provide reasonable, rather 
than absolute, assurance against material misstatement or crisis.
The Group has no formal internal audit function but the Group’s operations are subject to a regular programme of audit, risk assessment and evaluation,
including ﬁnancial, environmental, health and safety and operational areas. This ensures that senior management and the Board review and reﬂect upon
the overall risk proﬁle facing the business and that all key risks receive the appropriate level of management attention on an ongoing basis. The Executive
Directors have a signiﬁcant involvement in the day-to-day management of the Group’s activities and are therefore able to monitor the control
procedures at an operational and ﬁnancial level on an ongoing basis.
The key procedures, which the Directors have established with a view to providing effective internal control, are as follows:
•
the status of all potential and actual client contracts are reported to and reviewed by the Board at each monthly meeting;
•
the Executive Directors monitor the business performance through operational and ﬁnancial key performance indicators on a weekly basis;
•
management submit Board reports with appropriate and timely information. These include actual results against budgeted results plus updated
forecasts and regular reporting and reviews of the key business variables;
•
the deﬁnition of authorisation limits, ﬁnancial and otherwise;
•
a capital expenditure authorisation procedure requiring written approval by the Executive Directors; and 
•
the Audit Committee monitors the controls and procedures which are in force and any perceived gaps in the control environment and reports any
recommendations to the Board. The Committee also considers and determines relevant action regarding any control issues raised by management 
or external auditors. 27 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
INVESTOR RELATIONS
The Board attaches high importance to maintaining good relations with its shareholders. There is regular dialogue with both private and institutional
investors and fund managers, including presentations by certain members of the Board after the Company’s preliminary announcement of the year-end
results and the announcement of the results at the half-year. Site visits by institutional shareholders are encouraged as they enhance investors’
understanding of our business and processes.
The Group endeavours to maintain the involvement of shareholders by keeping them informed on major actions or decisions affecting their investment.
The Chairmen of the Audit, Remuneration and Nomination Committees attend the AGM and are available to answer shareholders’ questions.
The Chairman and Chief Executive are available to discuss governance, strategy and any issues of concern or interest with any major shareholders.
They both attend the AGM. The Board welcomes shareholder attendance and participation at the AGM.
There is a standing Board agenda item on investor relations and the views of the shareholders are disclosed to the Board as a whole. This gives the whole
Board an opportunity to understand and take into account the views of the major shareholders of the Company.
The Notice of Annual General Meeting, together with any related documents will be mailed to shareholders at least 20 working days before the meeting.
It is the Company’s practice to propose separate resolutions at the AGM on each different issue.
The proxy votes for and against each resolution, as well as abstentions, will be counted before the AGM and after the shareholders have voted on each
resolution on a show of hands (unless a poll is called for) the results will be made available. Copies of the details of the proxy voting will be available to
shareholders after the meeting on receipt of a written request addressed to the Company Secretary at the registered ofﬁce.
BOARD EVALUATION
The Board carried out, through a questionnaire with Directors, a formal evaluation of Board and Board committee performance. The results of that
exercise were considered by the Board in July 2006 and a number of actions agreed. These evaluations will be carried out annually. In the year, the
Chairman met the Non-executive Directors without the Executive Directors being present on at least one occasion.
TRAINING AND INFORMATION
On appointment, the Directors take part in an induction programme which includes receiving information about the Company, the role of the Board and
the matters reserved for its decision, the terms of reference and membership of the Board committees, and the powers delegated to those committees,
the Company’s corporate governance policies and procedures and the latest ﬁnancial information about the Group.
Directors are also advised on appointment of their legal and other duties and obligations as a Director of a listed company, both in writing and in face 
to face meetings with the Company Secretary. They are reminded of these duties annually and they are also updated on changes to the legal, accounting
and governance requirements upon the Company and themselves as Directors.
The format, quality and supply of information provided to the Board was reviewed as part of the Board evaluation process conducted in 2006.
DIRECTORS AND OFFICERS LIABILITY INSURANCE AND INDEMNITY
As in previous years, the Company has purchased insurance to cover its Directors and Ofﬁcers against their costs in defending themselves in civil legal
proceedings taken against them in that capacity and in respect of damages resulting from the unsuccessful defence of any proceedings.
On behalf of the Board
Anne E Lister
Company Secretary
24 July 2006 28 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
The revised Combined Code on Corporate Governance (‘the Code’) is appended to the Listing Rules, which are the rules that apply to public companies
listed on the London Stock Exchange.
The Code comprises a set of main principles which cover the general themes of the Board, Directors’ remuneration, ﬁnancial reporting, internal control
and communication with shareholders. Each main principle is further expanded by a set of supporting principles as well as detailed provisions.
Listed companies are required to include a statement in their annual report to say how the main and supporting principles have been applied and
whether or not the Company has complied with the Code’s provisions during the year. Where the Company is not compliant, the Code requires the
Company to explain why this is so. The Corporate Governance report on pages 24 to 27 and the Report on Directors’ Remuneration on pages 18 to 23
contain a detailed explanation of how the Company applies the main and supporting principles of the Code.
For ease of reference, a summary of the Company’s compliance with the Code’s provisions is included here with cross references to the relevant pages of 
the Corporate Governance report, the Report on Directors’ Remuneration, other sections of the Annual Report and Accounts and the Notice of Meeting in
respect of the 2006 AGM. Where the Company does not comply with a provision, an explanation for this has been given in the relevant section of the
Annual Report and Accounts.
COMBINED 
CODE
PROVISION COMMENT PAGE
The Board meets eleven times a year, which is sufﬁciently regular to discharge its A.1.1 Compliant 24
duties effectively. There is a formal schedule of matters speciﬁcally reserved for
its decision. The Corporate Governance report includes a statement of how the
Board operates and which issues are delegated to management.
The 2006 Annual Report and Accounts identiﬁes the Chairman, the Chief Executive, A.1.2 Compliant 24 to 27
the Senior Non-executive Director and the Chairmen and members of the Audit,
Remuneration and Nomination Committees. The number of meetings of the Board 
and the Committees and individual attendance by Directors is provided.
In the year, the Chairman met the Non-executive Directors without the Executive Directors A.1.3 Compliant 27
being present and the Non-executive Directors met without the Chairman and Executive 
Directors being present at least once.
Where Directors have concerns about the running of the Company or a proposed action, A.1.4 Compliant 25
which cannot be resolved, they ensure that their concerns are recorded in the Board minutes.
The Company arranges comprehensive Directors and Ofﬁcers liability insurance cover. A.1.5 Compliant 27
The roles of Chairman and Chief Executive are not exercised by the same individual. A.2.1 Explanation 24
The division of responsibilities between the Chairman and Chief Executive is clearly 
established and understood by the Board.
The Chairman meets the independence criteria set out in A.3.1 of the Code. A.2.2 Compliant 24
The Board considers that the majority of its Non-executive Directors to be independent. A.3.1 Explanation 24
The Corporate Governance report contains a statement on the independence of the 
Non-executive Directors.
The Board comprises the Chairman, two Executive Directors and three other A.3.2 Compliant 24
Non-executive Directors.
The Board has appointed the Chairman as Senior Independent Director. A N Foster is A.3.3 Compliant 2
available to shareholders if they have concerns which have not been resolved through 
the normal channels of communication or for which such contact is inappropriate.
Corporate Governance Summary 29 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
COMBINED 
CODE
PROVISION COMMENT PAGE
The Nomination Committee comprises the Chairman and the three other Non-executive A.4.1 Compliant 26
Directors. The Chairman of the Company chairs the Committee, but will not chair the 
Nomination Committee when it deals with the appointment of his successor.
The Nomination Committee’s principal functions are to review the structure, size and A.4.2 Compliant 26
composition of the Board, the membership of Board Committees and succession planning.
The Chairman discloses to the Board any changes to his other signiﬁcant commitments A.4.3 Compliant 24
as they arise.
The Chairman and Non-executive Directors each have a letter of appointment containing A.4.4 Compliant 22
a reciprocal rolling three month notice clause. The letters of appointment of the Chairman 
and the Non-executive Directors will be available for inspection at the 2006 AGM.
The letters of appointment of the Non-executive Directors state that they should exercise such Compliant 24
powers and perform such duties as are appropriate to the role. The Non-executive Directors
undertake that they will have sufﬁcient time to meet what is expected of them. A formal process 
for the disclosure of Non-executive Directors’ other signiﬁcant commitments is in place.
The Board’s policy is that Executive Directors may not take on more than one A.4.5 Compliant 24
non-executive directorship.
The work of the Nomination Committee and the process used in relation to Board appointments A.4.6 Compliant 26
in 2006 to date is described in the Corporate Governance report.
The process for inducting new Directors to the Board is described in the Corporate Governance report. A.5.1 Explanation 24
A procedure is in place so that Directors are able, if required, to seek independent professional A.5.2 Compliant 25
advice at the Company’s expense in connection with their duties.
All Directors have direct access to the advice and services of the Company Secretary. The Company A.5.3 Compliant 24
Secretary has responsibility for ensuring that Board procedures are followed. The appointment and 
removal of the Company Secretary is a matter reserved for the Board as a whole.
The Corporate Governance report contains a description of how performance evaluation A.6.1 Compliant 27
of the Board, its Committees and the individual Directors was conducted in 2006.
All Directors are subject to election by shareholders at the ﬁrst opportunity after their appointment A.7.1 Compliant 2 and 3
and a minimum of one third of Directors must retire at each AGM. The Annual Report and Accounts
for the 52 weeks to 29 April 2006 contains sufﬁcient biographical details to enable shareholders to 
take an informed meeting decision in relation to those Directors seeking election or re-election.
Non-executive Directors are appointed for speciﬁed terms, they are subject to re-election and to A.7.2 Compliant 24, 66
Companies Act provisions relating to the removal of a Director. The Notice of Meeting for the 2006 and 68
AGM states that two Non-executive Directors retire following their appointment since the last 
AGM and seek election. 30 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Corporate Governance Summary
CONTINUED
COMBINED 
CODE
PROVISION COMMENT PAGE
Performance related elements of the remuneration of Executive Directors forms a B.1.1 Compliant 19
percentage of the total remuneration and are designed to align their interests with 
those of shareholders and to give the Directors keen incentives to perform at the 
highest levels.
The Remuneration Committee is aware of the provisions of Schedule A to the 
Code and follows the provisions contained therein when designing new share 
plans for shareholders’ approval.
The Company does not offer executive share options at a discount. B.1.2 Compliant 20
The Board sets levels of remuneration for Non-executive Directors which reﬂect the B.1.3 Compliant 18 and 19 
time commitment and responsibilities of the role. Non-executive Directors are not 
awarded share options.
No Executive Director serves as a non-executive director of any other company. B.1.4 Compliant 24
The Remuneration Committee has carefully considered what compensation commitments B.1.5 Partly 22
(including pension contributions and all other elements) the Directors’ terms of appointment compliant/
would entail in the event of early termination and this is explained in the Report on Directors’ explanation
Remuneration.
Notice or contract periods for the Executive Directors are set at twelve months. B.1.6 Compliant 22
The Remuneration Committee comprises three independent Non-executive Directors and B.2.1 Compliant 25
one other Non-executive Director. A description of the role of the Remuneration Committee 
and the authority delegated to it by the Board is included in the Report on Directors’
Remuneration. The Remuneration Committee’s terms of reference are available on the 
Company website or from the Company Secretary.
The Board has delegated responsibility to the Remuneration Committee for setting B.2.2 Compliant 25
remuneration for all Executive Directors and the Chairman. The Committee also 
recommends and monitors the level and structure of remuneration for senior management.
The Non-executive Directors’ fees, including those of the Chairman, are determined B.2.3 Compliant 19
by the Board without the Non-executive Directors present.
Shareholders are invited speciﬁcally to approve all new long-term incentive schemes B.2.4 Compliant 19, 20
and signiﬁcant changes to existing schemes. and 67
The Directors explain their responsibility for preparing the accounts and there is a C.1.1 Compliant 32 and 33
statement by the auditors on their reporting responsibilities.
The Directors report that the business is a going concern. C.1.2 Compliant 17
The Board maintains a sound system of internal control to safeguard shareholders’ C.2.1 Compliant 26
investment and the Company’s assets.
The Audit Committee, comprising four Non-executive Directors, meets at least twice C.3.1 Compliant 26
a year and met on two occasions during 2005/2006. R B Mead, Chairman of the 
Audit Committee has, in the opinion of the Board, recent and relevant ﬁnancial experience. 31 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
COMBINED 
CODE
PROVISION COMMENT PAGE
The main role and responsibilities of the Audit Committee are set out in its terms of C.3.2 Compliant 26
reference and these include all the requirements set out in the Code.
The terms of reference of the Audit Committee are available on the Company’s website C.3.3 Compliant 26
or from the Company Secretary. The responsibilities of the Audit Committee are described 
in the Corporate Governance report.
The Audit Committee has reviewed arrangements by which staff of the Company may, C.3.4 Compliant 26
in conﬁdence, raise concerns about possible improprieties in matters of ﬁnancial reporting 
or other matters. Arrangements are in place for the proportionate and independent 
investigation of such matters and for appropriate follow up action.
The Audit Committee monitors and reviews the effectiveness of internal audit activities. C.3.5 Compliant 26
The Audit Committee has primary responsibility for making recommendations on the C.3.6 Compliant 26
appointment, reappointment and removal of the external auditors.
A statement on how the auditor’s objectivity and independence is safeguarded is included in C.3.7 Compliant 26
the Corporate Governance report.
The Chairman ensures that the views of major shareholders are communicated to the Board  D.1.1 Compliant 27
as a whole. Non-executive Directors are offered the opportunity to meet major shareholders 
to listen to their views in order to develop a balanced understanding of the issues and concerns 
of major shareholders.
The Corporate Governance report sets out the steps taken by the Board to ensure that D.1.2 Compliant 27
Directors develop an understanding of the views of major shareholders about the Company.
At the 2006 AGM, the Company will count all proxy votes and, unless a poll is called, will D.2.1 Compliant 27
provide the level of proxies lodged on each resolution and the balance for and against the 
resolution and the number of abstentions, after each resolution has been dealt with on a 
show of hands. The Company uses its Registrars, who have a proven and established procedure,
to ensure that votes cast are properly received and recorded.
A separate resolution will be proposed at the 2006 AGM on each substantially separate issue D.2.2 Compliant 66 and 67
and there will be a resolution to receive the Annual Report and Accounts for the 52 weeks to
29 April 2006.
The Chairmen of the Audit, Remuneration and Nomination Committees will be available to D.2.3 Compliant 27
answer questions at the 2006 AGM and all Directors will attend.
The Notice of Meeting for the 2006 AGM will be sent to shareholders at least 20 working D.2.4 Compliant 27
days before the meeting. 32 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Independent Auditors’ Report 
TO THE MEMBERS OF UNIVERSAL SALVAGE PLC
We have audited the Group and parent company ﬁnancial statements (the ‘ﬁnancial statements’) of Universal Salvage plc for the 52 weeks to
29 April 2006 which comprise the Group income statement, the Group and parent company statements of recognised income and expense, the
Group and parent company balance sheets, the Group cash ﬂow statement and the related notes. These ﬁnancial statements have been prepared
under the accounting policies set out therein. We have also audited the information in the Report on Directors’ Remuneration that is described
as having been audited.
RESPECTIVE RESPONSIBILITIES OF DIRECTORS AND AUDITORS
The Directors’ responsibilities for preparing the annual report, the Report on Directors’ Remuneration and the ﬁnancial statements in accordance
with applicable law and International Financial Reporting Standards (‘IFRS’) as adopted by the European Union are set out in the Statement of
Directors’ Responsibilities.
Our responsibility is to audit the ﬁnancial statements and the part of the Report on Directors’ Remuneration to be audited in accordance 
with relevant legal and regulatory requirements and International Standards on Auditing (UK and Ireland). This report, including the opinion,
has been prepared for and only for the Company’s members as a body in accordance with Section 235 of the Companies Act 1985 and for no
other purpose. We do not, in giving this opinion, accept or assume responsibility for any other purpose or to any other person to whom this
report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
We report to you our opinion as to whether the ﬁnancial statements give a true and fair view and whether the ﬁnancial statements and 
the part of the Report on Directors’ Remuneration to be audited have been properly prepared in accordance with the Companies Act 1985 
and article 4 of the IAS Regulation. We also report to you if, in our opinion, the Directors’ Report is not consistent with the ﬁnancial 
statements, if the Company has not kept proper accounting records, if we have not received all the information and explanations we require 
for our audit, or if the information speciﬁed by law regarding Directors’ remuneration and other transactions is not disclosed.
We review whether the Corporate Governance statement reﬂects the Company’s compliance with the nine provisions of the 2003 FRC
Combined Code speciﬁed for our review by the Listing Rules of the Financial Services Authority, and we report if it does not. We are not 
required to consider whether the Board’s statement on internal control covers all risks and controls, or form an opinion on the effectiveness 
of the Group’s corporate governance procedures or its risk and control procedures.
We read other information contained in the annual report and consider whether it is consistent with the audited ﬁnancial statements.
The other information comprises only the Directors’ Report, the unaudited part of the Report on Directors’ Remuneration, the Chairman’s
Statement, the Chief Executive’s Review, the Group Finance Director’s Review, the Corporate Social Responsibility Statement, the Corporate
Governance statement, Five Year Financial Record and other information for shareholders. We consider the implications for our report if we
become aware of any apparent misstatements or material inconsistencies with the ﬁnancial statements. Our responsibilities do not extend 
to any other information.
BASIS OF AUDIT OPINION
We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing Practices Board.
An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the ﬁnancial statements and the part of
the Report on Directors’ Remuneration to be audited. It also includes an assessment of the signiﬁcant estimates and judgements made by the
Directors in the preparation of the ﬁnancial statements, and of whether the accounting policies are appropriate to the Group’s and Company’s
circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us
with sufﬁcient evidence to give reasonable assurance that the ﬁnancial statements and part of the Report on Directors’ Remuneration to be
audited are free from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the
overall adequacy of the presentation of information in the ﬁnancial statements and the part of the Report on Directors’ Remuneration to be audited. 33 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Company law requires the Directors to prepare ﬁnancial statements for each ﬁnancial year which give a true and fair view of the state of 
affairs of the Company and Group and of the proﬁt or loss of the Group for that period.
In preparing those ﬁnancial statements, the Directors are required to:
•
select suitable accounting policies and then apply them consistently;
•
make judgements and estimates that are reasonable and prudent; and
•
state that the ﬁnancial statements comply with applicable accounting standards.
The Directors conﬁrm that they have complied with the above requirements in preparing the ﬁnancial statements.
After making enquiries, the Directors have a reasonable expectation that the Company and the Group have adequate resources to continue 
in operational existence for the foreseeable future. For this reason, the Directors continue to adopt the going concern basis in preparing the
ﬁnancial statements.
The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the ﬁnancial position 
of the Company and Group and to enable them to ensure that the ﬁnancial statements comply with the Companies Act 1985. The shareholders
do not have the power to amend the ﬁnancial statements after issue. The Directors 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 also responsible for the maintenance and integrity of the Group’s website. However, information is accessible in many 
different countries where legislation governing the preparation and dissemination of ﬁnancial statements may differ from that applicable in 
the United Kingdom.
The responsibilities of the auditors are set out in the Independent Auditors’ Report on page 32.
Statement of Directors’ Responsibilities
IN RESPECT OF THE FINANCIAL STATEMENTS
OPINION
In our opinion:
•
the Group ﬁnancial statements give a true and fair view, in accordance with IFRS as adopted by the European Union, of the state of the
Group’s affairs as at 29 April 2006 and of its proﬁt and cash ﬂows for the 52 weeks then ended;
•
the parent company ﬁnancial statements give a true and fair view, in accordance with IFRS as adopted by the European Union as applied 
in accordance with the provisions of the Companies Act 1985, of the state of the parent company’s affairs as at 29 April 2006 and of its
cash ﬂows for the 52 weeks then ended; and
•
the ﬁnancial statements and the part of the Report on Directors’ Remuneration to be audited have been properly prepared in accordance
with the Companies Act 1985 and article 4 of the IAS Regulation.
PricewaterhouseCoopers LLP
Chartered Accountants and Registered Auditors
London
24 July 2006 34 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
2006 2005
FOR THE 52 WEEKS TO 29 APRIL 2006 NOTE £m £m
GROUP 
Proﬁt/(loss) after taxation for the period 0.7 (1.6)
Total recognised income/(expense) since the last annual report 0.7 (1.6)
COMPANY 
Proﬁt/(loss) after taxation for the period 6 – 0.1
Total recognised income/(expense) since the last annual report – 0.1
The accompanying notes are an integral part of these statements of recognised income and expense.
Statements of Recognised Income and Expense
2006 2006 2006 2005 2005 2005
BEFORE EXCEPTIONAL TOTAL BEFORE EXCEPTIONAL TOTAL
EXCEPTIONAL ITEMS EXCEPTIONAL ITEMS
ITEMS (NOTE 3) ITEMS (NOTE 3)
FOR THE 52 WEEKS TO 29 APRIL 2006 NOTE £m £m £m £m £m £m
Revenue 2 56.4 – 56.4 49.7 – 49.7
Cost of sales (45.6) – (45.6) (39.6) – (39.6)
Gross proﬁt 10.8 – 10.8 10.1 – 10.1
Administrative expenses (9.9) (0.2) (10.1) (11.0) 0.8 (10.2)
Operating proﬁt/(loss) 0.9 (0.2) 0.7 (0.9) 0.8 (0.1)
Interest receivable 4 ––– 0.1 – 0.1
Interest payable and similar charges 4 (0.4) (0.1) (0.5) (0.7) (0.4) (1.1)
Proﬁt/(loss) before taxation 3 0.5 (0.3) 0.2 (1.5) 0.4 (1.1)
Taxation 5 0.6 (0.1) 0.5 – (0.5) (0.5)
Proﬁt/(loss) after taxation 1.1 (0.4) 0.7 (1.5) (0.1) (1.6)
Earnings/(loss) per Ordinary share (pence) – basic 7 2.4p (5.8)p
– diluted 7 2.3p (5.8)p
The accompanying notes are an integral part of this Group income statement.
All operations of the Group continued throughout both periods and no material operations were acquired or discontinued.
Group Income Statement 35 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Balance Sheets
GROUP COMPANY
2006 2005 2006 2005
AT 29 APRIL 2006 NOTE £m £m £m £m
ASSETS
Non current assets
Property, plant and equipment 11 21.2 22.7 – –
Intangible assets 10 0.1 0.2 – –
Investments in subsidiaries 12 – – 9.5 9.5
21.3 22.9 9.5 9.5
Current assets
Inventories 13 3.3 2.8 – –
Trade and other receivables 14 2.8 3.5 – –
Cash and cash equivalents 15 1.8 – – –
7.9 6.3 – –
LIABILITIES
Current liabilities
Financial liabilities 18 (0.1) – – –
Trade and other payables 16 (6.0) (6.2) – –
Current tax liabilities 17 (0.2) (0.7) (0.1) (0.2)
Provisions 19 (0.1) – – –
(6.4) (6.9) (0.1) (0.2)
Net current assets/(liabilities) 1.5 (0.6) (0.1) (0.2)
Total assets less current liabilities 22.8 22.3 9.4 9.3
Non current assets
Trade and other receivables 14 0.1 0.1 2.5 2.5
Non current liabilities
Financial liabilities 18 (5.9) (5.9) – –
Deferred tax liabilities 20 (1.0) (1.7) – –
Other non current liabilities (0.2) – – –
(7.1) (7.6) – –
Net assets 15.8 14.8 11.9 11.8
Shareholders’ equity
Ordinary shares 22 2.8 2.8 2.8 2.8
Share premium account 25 1.3 1.2 1.3 1.2
Other reserves 24 3.0 3.1 6.7 6.7
Retained earnings 25 8.7 7.7 1.1 1.1
Total equity 25 15.8 14.8 11.9 11.8
The ﬁnancial statements were approved by the Board on 24 July 2006 and signed on its behalf by:
Alexander N Foster Avril Palmer-Baunack 
Chairman Chief Executive
The accompanying notes are an integral part of these balance sheets. 36 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
GROUP
2006 2005
FOR THE 52 WEEKS TO 29 APRIL 2006 NOTE £m £m
Cash ﬂows from operating activities
Cash generated from operations 29 2.5 (1.3)
Interest received – 0.1
Interest paid (0.4) (0.6)
Bank facility fees paid (0.1) (0.2)
Corporation tax (paid)/received (0.7) 0.3
Net cash from operating activities 1.3 (1.7)
Cash ﬂows from investing activities
Purchase of property, plant and equipment (0.6) (0.6)
Receipt for potential sale of site 0.2 –
Proceeds from sale of property, plant and equipment 1.0 6.8
Net cash from investing activities 0.6 6.2
Cash ﬂows from ﬁnancing activities 
Net proceeds from issue of Ordinary share capital 0.1 –
Repayment of borrowings (0.2) (4.5)
Net cash used in ﬁnancing activities (0.1) (4.5)
Net increase in cash and cash equivalents 1.8 –
Opening cash and cash equivalents – –
Closing cash and cash equivalents 15 1.8 –
No cash ﬂow statement is shown for the Company as no cash ﬂows occurred during the current period or the prior period.
The accompanying notes are an integral part of this Group cash ﬂow statement.
Group Cash Flow Statement 37 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
1. ACCOUNTING POLICIES 
The Group has adopted International Financial Reporting Standards (‘IFRS’) with effect from 2 May 2004. The accounting policies have, unless otherwise indicated,
been applied consistently to all periods presented within the ﬁnancial statements.
BASIS OF PREPARATION
These ﬁnancial statements have been prepared in accordance with IFRS and International Financial Reporting Interpretations Committee (‘IFRIC’) interpretations as
adopted by the European Union and with those parts of the Companies Act 1985 (the ‘Act’) applicable to companies reporting under IFRS. The ﬁnancial statements
have been prepared under the historical cost convention as modiﬁed by the revaluation of certain freehold and leasehold land and buildings. A summary of the
more important Group accounting policies is set out below, together with an explanation of where changes have been made to the previous policies on adoption 
of new accounting standards in the year.
The preparation of ﬁnancial statements in conformity with generally accepted accounting principles requires the use of estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the ﬁnancial statements and the reported amounts of revenues and expenses during the reporting period.
Although these estimates are based on the management’s best knowledge of the amount, event or actions, actual results ultimately may differ from those
estimates. It is the management’s view that any adjustment to assets or liabilities arising due to the use of estimates and assumptions would not be material 
in the context of these ﬁnancial statements.
The Group has adopted all accounting standards that require mandatory application for periods ending 29 April 2006 but has not early adopted any other
accounting standards.
FIRST TIME ADOPTION OF IFRS
The Group has taken advantage of the following exemptions available under IFRS1 ‘First-time adoption of International Financial Reporting Standards’:
•
Share-based payments - IFRS2 ‘Share-based payments’ has only been applied to awards of share options granted on or after 7 November 2002.
BASIS OF CONSOLIDATION
The accounting reference date of all Group companies is 30 April and this year the ﬁnancial statements of Universal Salvage plc and its subsidiary undertakings
have been drawn up to 29 April 2006, being the nearest Saturday to 30 April 2006. Therefore, the Group ﬁnancial statements, which comprise the ﬁnancial
statements of Universal Salvage plc and all its subsidiary undertakings, cover the period 1 May 2005 to 29 April 2006. As permitted by Section 230 of the Act,
no income statement is presented for Universal Salvage plc. The proﬁt for the ﬁnancial year of the parent company is disclosed in note 6.
REVENUE RECOGNITION
Revenue represents amounts receivable for goods and services provided in the normal course of business, net of trade discounts, VAT and other sales related taxes.
Vehicle sales at auction are recognised in the ﬁnancial statements when the hammer drops, which under the terms and conditions of sale is the point at which 
the legally binding contract is formed between the Group and the buyer. Where vehicles are sold on behalf of third parties, the vehicle handling fee is also
recognised as revenue when the hammer drops following the completion of the service of disposal on behalf of the client. In a small number of cases, the contract
is not completed. To account for these cases, both revenue and cost of sales are reduced by an amount based on the average level of cancelled sales over the last
three months of the accounting period.
Scrap metal income from processing is recognised at the point, following the vehicle being crushed, the metal cubes have been collected and weighed by third 
party fragmentors.
Related service income such as delivery of vehicles and other services, including vehicle logistics activities for third party clients, is recognised only when the
associated service has been performed.
SEGMENTAL REPORTING
The Group has determined from a review of its business activities that, due to the differing risks/rewards of its business streams, the primary reporting format 
in its ﬁnancial statements shall be by business segment. The applicable business segments are:
•
SALVAGE VEHICLES
These vehicles are sourced from insurance companies, accident management companies, ﬂeet operators and motor manufacturers. They are usually vehicles
that have been subject to a total loss insurance claim and are deemed beyond economic repair. The Group has a mix of contracts in this segment – some
where the Group takes the proprietary risk on buying and selling these vehicles, others where the Group does not take this risk but instead earns a fee.
Notes to the Financial Statements
AT 29 APRIL 2006 38 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED
1. ACCOUNTING POLICIES CONTINUED
SEGMENTAL REPORTING CONTINUED
•
NON-SALVAGE FEE-BASED VEHICLES
These are vehicles sourced from dealerships, ﬁnance houses, other vehicle retailers and members of the public. These vehicles tend to be lower value, which
may not attract adequate returns at traditional vehicle auction houses. The Group earns a fee for providing a disposal service.
•
END-OF-LIFE VEHICLES
These are abandoned or road tax default vehicles sourced from local authorities, housing associations, the Police Service or other businesses. The Group has
contracts to either accept or collect vehicles within a geographical area, store them for a short period and then dispose of them. The Group earns a fee for this
service and will obtain some value from recoverable parts and metal sales.
The secondary reporting format is geographical, although the Group operates only within the UK and the risks/rewards between regions are not materially different
to require any regional segmentation.
Costs have been allocated between the reportable segments to the extent that it is appropriate to do so – directly if applicable; if not, by either number of vehicles
collected, number of vehicles disposed, or acres employed.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are stated at cost or valuation, net of depreciation and any provisions for impairment. In the transition IFRS balance sheet as at 
2 May 2004 and subsequently, the Group has adopted a policy of external revaluation for land and buildings every ﬁve years. Interim valuations will be carried 
out in intervening years only where there has been a material change in value. The freehold and leasehold land and buildings were revalued at 2 May 2004 
on a fair value basis.
Interest incurred on borrowings to ﬁnance speciﬁc site developments is capitalised at its gross amount, before tax, using average interest rates in the relevant
development period, up to the date the site becomes operational.
DEPRECIATION
Depreciation is provided on a straight-line basis on all property, plant and equipment, other than freehold land, at rates calculated to write-off the cost or valuation
of each asset down to its estimated residual value over its expected useful life, as follows:
Freehold buildings over 10 to 30 years
Leasehold buildings over the lease term
Site improvements over 5 to 25 years
Plant, machinery and motor vehicles over 3 to 10 years
Ofﬁce and computer equipment over 3 to 5 years
No depreciation is charged on assets under construction.
In arriving at estimates of residual values, the Group considers external market factors such as product demand and obsolescence, and internal factors such as
expected time-frame over which each asset will be utilised and the intensity at which the assets are expected to be used. Where appropriate, the Group retains the
services of independent valuation agents to assist in arriving at estimates of residual values. The residual value of an asset is the estimated amount that the Group
would currently obtain from disposal of the asset, after deducting the estimated costs of disposal, if the asset were already of the age and in the condition expected
at the end of its useful life. Residual values are reviewed at least annually and more frequently should there be an indication that residual values have changed
signiﬁcantly since the last annual review.
INTANGIBLES
The Group holds intangible assets in the form of externally purchased computer software and some internally developed software. These intangible assets are 
held at cost and amortised on a straight-line basis over their useful economic lives. The Group does not hold any intangible assets with indeﬁnite useful lives 
and therefore does not carry out annual impairment reviews unless there are indications that an asset or group of assets may have become impaired.
INVESTMENTS
Fixed asset investments are shown at cost or valuation less any provision for impairment.
PROPERTY LEASED TO CUSTOMERS
Property leased to customers under operating leases is capitalised in accordance with the ﬁxed asset policy above. Operating lease income is accounted 
for on a straight-line basis with any rental increases recognised during the period to which they relate. Operating lease income is shown as revenue in the 
Group income statement. 39 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
1. ACCOUNTING POLICIES CONTINUED
GRANTS
In accordance with IAS20 ‘Accounting for Government Grants and Disclosure of Government Assistance’, grants and contributions relating to the development of
operating land have been deducted from the cost of ﬁxed assets.
IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT AND INTANGIBLE ASSETS
The carrying value of property, plant and equipment and intangible assets are reviewed for impairment in periods where changes in circumstances indicate the
carrying value may not be recoverable. Impairment is deemed to have occurred when the carrying value exceeds the higher of fair value less costs to sell and value
in use. Where an asset or group of assets has become impaired, the impairment loss is charged through the income statement. The Group calculates value in use by
taking the post-tax weighted average cost of capital, and applying this to the expected future cash ﬂows from relevant income generating units to arrive at net
present value.
Where impairment occurs on a revalued asset, the impairment loss is charged initially to the revaluation reserve to reduce the asset to its depreciated historical
cost, with any excess being charged to the income statement
INVENTORIES
Inventories are stated at the lower of cost incurred in bringing each vehicle or component to its present location and its net realisable value, as follows:
Work in progress – cost of direct materials and labour
Vehicles and components for resale – cost of vehicle/component plus direct costs incurred in relation to collection of the vehicle
Inventories are allocated for sale on a ﬁrst-in, ﬁrst-out basis. Provision is made for slow-moving items where appropriate.
PROVISIONS
In accordance with IAS37 ‘Provisions, Contingent Liabilities and Contingent Assets’, the Group recognises a provision when it has a present obligation (legal or
constructive) as a result of a past event, it is probable that an outﬂow of resources will be required to settle the obligation, and a reliable estimate can be made 
of the amount of the obligation.
Contingent liabilities and contingent assets are not recognised but are instead disclosed, if a ﬂow of economic beneﬁts is possible.
Where necessary, the Group applies the use of discounting to long-term provisions, using an appropriate discount rate to arrive at the present value of future
expected cash ﬂows.
TAXATION
The charge for current tax is based on the results for the year as adjusted for items which are non-assessable or disallowed. It is calculated using taxation rates 
that have been enacted or substantively enacted by the balance sheet date.
Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences arising from differences between the carrying amount 
of assets and liabilities in the ﬁnancial statements and the corresponding tax basis used in the computation of taxable proﬁt. In principle, deferred tax liabilities 
are recognised for all taxable temporary differences. Deferred tax temporary differences can be utilised. Such assets and liabilities are not recognised if the
temporary difference arises from goodwill, negative goodwill or from the acquisition of an asset, which do not affect either taxable or accounting income.
Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled. Deferred tax is charged or
credited in the Group income statement, except when it relates to items credited or charged directly to equity, in which case the deferred tax is also dealt with 
in equity.
LEASING AND HIRE PURCHASE COMMITMENTS
Assets held under ﬁnance leases and hire purchase contracts, which are those where substantially all the risks and rewards of ownership of the asset have passed 
to the Group, are capitalised and depreciated over the shorter of their lease terms and their useful lives.
The interest element of the rental obligations is charged to the Group income statement over the period of the lease and represents a constant proportion of the
balance of capital repayments outstanding.
Rentals paid under operating leases are charged to income on a straight-line basis over the lease term, even if the payments are not made on such a basis.
PENSIONS
The Group operates deﬁned contribution pension schemes for certain Directors and employees. Contributions are charged to the Group income statement as they
become payable in accordance with the rules of the schemes. Differences between contributions payable in the year and contributions actually paid are shown in
either accruals or prepayments in the balance sheet. The assets of the scheme are held separately from those of the Group in independently administered funds. 40 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
1. ACCOUNTING POLICIES CONTINUED
SHARE-BASED PAYMENTS
The Group has in place various Save As You Earn (“SAYE”) and Executive share option schemes. The Black-Scholes model is used to fair value each share option,
which in turn is applied to the relevant number of options to arrive at a total cost. This cost is then charged to the Group income statement over the vesting period
of the option. The variables used in this model and their sources are as follows:
VARIABLE SOURCE
Share price at grant date Historic closing middle market share price
Exercise price Option scheme
Volatility Historic closing middle market share price over period equal to vesting period of the option
Risk free rate Yield on zero-coupon Government bonds with maturity equal to vesting period of the option
Dividend yield Historic net dividend yield
Expected life Historic time period between vesting and exercise
Proportion expected to vest Historic data, plus estimates of future RPI and EPS
In respect of the Executive share option schemes, the Directors make assumptions on the likelihood of achieving the performance conditions by estimating the
variables linked to those conditions. RPI is estimated using forecasts available from Government sources and EPS is estimated using available budgets and forecasts.
UNIVERSAL SALVAGE PLC 2000 EMPLOYEES’ SHARE TRUST – (THE ‘TRUST’)
Shares purchased through the Trust are held at cost and are taken as a deduction in arriving at shareholders’ funds.
The net result of the Trust, including proﬁts and losses on sale of shares and tax thereon, but excluding any dividend received and receivable from Universal Salvage
plc (which has been waived), is included in the ﬁnancial statements. The reserves of the Trust are accounted for as a separate non-distributable reserve. Costs
associated with the Trust are written-off in the Group ﬁnancial statements within administrative costs as they are incurred.
CASH AND CASH EQUIVALENTS
The Group holds small amounts of petty cash and, from time to time, short-term money market deposits which bear interest on maturity. These items are held 
at cost.
FINANCIAL INSTRUMENTS
The Group accounts for ﬁnancial instruments in accordance with IAS32 ‘Financial Instruments: Disclosure and Presentation’ and IAS39 ‘Financial Instruments:
Recognition and Measurement’ with effect from its transition to IFRS on 2 May 2004.
The Group recognises a debt instrument when it becomes party to the contractual provisions of the instrument and currently maintains a mixture of ﬁxed and
ﬂoating rate instruments to fund its operations. The interest rate structure of these debts is linked to the Bank of England base rate and London Inter Bank Offered
Rate (‘LIBOR’). No premiums or discounts are applicable on redemption.
The Group recognises a debtor when a contractual right to the cash ﬂows exists. Derecognition of a debtor occurs when the contractual right to the cash ﬂows
ceases to exist, at which point the difference between the carrying amount and the consideration received is recognised as a proﬁt or loss.
The Group recognises a ﬁnancial liability when a contractual right to the cash ﬂow exists. Derecognition of a ﬁnancial liability occurs when the contractual right 
to the cash ﬂow ceases to exist, at which point the difference between the carrying amount and the consideration paid is recognised as a proﬁt or loss.
The Group does not hold or issue derivative ﬁnancial instruments for speculative purposes.
For an interest rate swap to be treated as a hedge, the instrument must be related to actual assets or liabilities or a probable commitment and must change the
nature of the interest rate by converting a ﬁxed rate to a variable rate or vice versa. Interest differentials under these swaps are recognised by adjusting net interest
payable over the periods of the contracts.
If an instrument ceases to be accounted for as a hedge, for example because the underlying hedged position is eliminated, the instrument is marked to market and
any resulting proﬁt or loss recognised at that time.
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED 41 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
1. ACCOUNTING POLICIES CONTINUED
FINANCIAL RISK MANAGEMENT
FINANCIAL RISK FACTORS
The Group’s operations and debt ﬁnancing expose it to a number of ﬁnancial risks that include credit risk, liquidity and interest rates. Wherever possible, the Group 
seeks to limit the adverse effects caused by these risks on the ﬁnancial performance of the Group.
(a) INTEREST RATE RISK
The Group has used an interest rate swap as a cash ﬂow hedge of future interest payments, which has the effect of increasing the Group’s proportion of 
ﬁxed rate debt. This was deemed necessary to protect the Group against adverse interest rate movements. The interest rate swap was for a ﬁve year period,
becoming due for settlement in November 2006. The swap was settled early, in April 2006, as this was more cost effective than leaving the swap to terminate
at its expiry.
(b) CREDIT RISK
The Group has no signiﬁcant concentrations of credit risk. Predominantly, cleared funds are required before vehicles disposed of at auction are permitted 
to be removed from site or delivered. There are exceptions, but in those instances appropriate credit checks are carried out on potential customers before 
vehicles are released.
(c) LIQUIDITY RISK
The Group maintains long-term committed facilities and short-term borrowings to ensure the Group has sufﬁcient available funds for capital expenditure
requirements and operations.
Derivatives are initially accounted and measured at fair value on the date a derivative contract is entered into and subsequently measured at fair value. The gain 
or loss on re-measurement is taken to the income statement except where the derivative is a designated cash ﬂow hedging instrument. The accounting treatment
of derivatives classiﬁed as hedges depend on their designation, which occurs on the date that the derivative contract is committed to. The Group designates
derivatives as a hedge of the income/cost of a highly probable forecasted transaction or commitment (‘cash ﬂow hedge’).
In order to qualify for hedge accounting, the Group is required to document in advance the relationship between the item being hedged and the hedging
instrument. The Group is also required to document and demonstrate an assessment of the relationship between the hedged item and the hedging instrument,
which shows that the hedge will be highly effective on an ongoing basis. This effectiveness testing is re-performed at each quarter end to ensure that the hedge
remains highly effective.
Gains or losses on cash ﬂow hedges that are regarded as highly effective are recognised in equity. Where the forecast transaction results in a ﬁnancial asset or
liability, only gains or losses previously recognised in equity are reclassiﬁed to proﬁt or loss in the same period as the asset or liability affects proﬁt or loss. Where
the forecasted transaction or commitment results in a non-ﬁnancial asset or a liability, any gains or losses previously deferred in equity are included in the cost of
the related asset or liability. If the forecasted transaction or commitment results in future income or expenditure, gains or losses deferred in equity are transferred
to the income statement in the same period as the underlying income or expenditure. The ineffective portions of the gain or loss on the hedging instrument are
recognised in proﬁt or loss.
For the portion of hedges deemed ineffective or transactions that do not qualify for hedge accounting under IAS39, any change in the fair value of assets or
liabilities is recognised immediately in the income statement. Where a hedge no longer meets the effectiveness criteria, any gains or losses deferred in equity are
only transferred to the income statement when the committed or forecasted transaction is recognised in the income statement. However, where the Group applied
cash ﬂow hedge accounting for a forecasted or committed transaction that is no longer expected to occur, then the cumulative gain or loss that has been recorded
in equity is transferred to the income statement. When a hedging instrument expires or is sold, any cumulative gain or loss existing in equity at that time remains
in equity and is recognised when the forecast transaction is ultimately recognised in the income statement.
FAIR VALUE ESTIMATION
The fair value of short-term deposits, loans and overdrafts with a maturity of less than one year are assumed to approximate to their book values. In the case 
of bank loans and other loans due in more than one year, the fair values of ﬁnancial liabilities for disclosure purposes is estimated by discounting the future
contractual cash ﬂows at the current market interest rate available to the Group for similar ﬁnancial instruments. 42 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED
2. SEGMENTAL REPORTING
NON-SALVAGE
PRIMARY REPORTING FORMAT – BUSINESS SEGMENTS SALVAGE FEE-BASED END-OF-LIFE
VEHICLES VEHICLES VEHICLES UNALLOCATED TOTAL
FOR THE 52 WEEKS TO 29 APRIL 2006 £m £m £m £m £m
Revenue 51.7 2.2 1.1 1.4 56.4
Operating proﬁt before exceptional items 0.3 0.4 0.1 0.1 0.9
Exceptional items within operating proﬁt –  –  –  (0.2) (0.2)
Segment result 0.3 0.4 0.1 (0.1) 0.7
Interest expense –  –  –  (0.4) (0.4)
Exceptional items – facility fee –  –  –  (0.1) (0.1)
Proﬁt/(loss) before taxation 0.3 0.4 0.1 (0.6) 0.2
Taxation –  –  –  0.5 0.5
Net proﬁt/(loss) attributable to equity shareholders 0.3 0.4 0.1 (0.1) 0.7
Segment assets 19.4 3.2 1.5 – 24.1
Unallocated assets
– property, plant and equipment – – – 5.2 5.2
Total assets 19.4 3.2 1.5 5.2 29.3
Segment liabilities (4.4) (0.8) –  – (5.2)
Unallocated liabilities
– accruals and deferred income – – – (1.3) (1.3)
– ﬁnancial liabilities – – – (6.0) (6.0)
– deferred taxation – – – (1.0) (1.0)
Total liabilities (4.4) (0.8) –  (8.3) (13.5)
Other segment items
Capital expenditure 0.5 0.1 0.1 0.2 0.9
Depreciation 1.1 0.2 0.2 0.1 1.6
Amortisation of intangible assets 0.1 – –  –  0.1 43 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
2. SEGMENTAL REPORTING CONTINUED
NON-SALVAGE
PRIMARY REPORTING FORMAT – BUSINESS SEGMENTS SALVAGE FEE-BASED END-OF-LIFE
VEHICLES VEHICLES VEHICLES UNALLOCATED TOTAL
FOR THE 52 WEEKS TO 30 APRIL 2005 £m £m £m £m £m
Revenue 43.8 2.7 1.4 1.8 49.7
Operating loss before exceptional items (0.4) (0.1) (0.3) (0.1) (0.9)
Exceptional items within operating (loss)/proﬁt – – – 0.8 0.8
Segment result (0.4) (0.1) (0.3) 0.7 (0.1)
Interest expense – – – (0.7) (0.7)
Interest income – – – 0.1 0.1
Exceptional items – facility fee – – – (0.4) (0.4)
Loss before taxation (0.4) (0.1) (0.3) (0.3) (1.1)
Taxation – – – (0.5) (0.5)
Net loss attributable to equity shareholders (0.4) (0.1) (0.3) (0.8) (1.6)
Segment assets 18.3 5.3 2.5 – 26.1
Unallocated assets
– property, plant and equipment – – – 3.2 3.2
Total assets 18.3 5.3 2.5 3.2 29.3
Segment liabilities (4.9) (1.2) – – (6.1)
Unallocated liabilities
– accruals and deferred income – – – (0.8) (0.8)
– ﬁnancial liabilities – – – (5.9) (5.9)
– deferred taxation – – – (1.7) (1.7)
Total liabilities (4.9) (1.2) – (8.4) (14.5)
Other segment items
Capital expenditure 0.3 0.1 0.1 0.1 0.6
Depreciation 0.9 0.3 0.3 0.2 1.7
Amortisation of intangible assets 0.3 0.1 – – 0.4
There are immaterial sales between the business segments. Unallocated costs represent corporate expenses. Segment assets include property, plant and equipment,
inventories, receivables and operating cash. Segment liabilities comprise operating liabilities and exclude taxation and certain corporate borrowings. Capital
expenditure comprises additions to property, plant and equipment.
SECONDARY FORMAT – GEOGRAPHICAL SEGMENTS
The Group manages its business segments within the UK, and the Directors regard this as a single economic environment. Therefore, there only exists a single
geographical segment.
COMPANY
The Company’s business is to invest in its subsidiaries and therefore it operates in a single segment. 44 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED
3. PROFIT/(LOSS) BEFORE TAXATION
2006 2005
The following items have been included in arriving at the proﬁt/(loss) before taxation: NOTE £m £m
Staff costs 8.8 8.7
Cost of inventories recognised as an expense (included in cost of sales) 36.8 31.1
Repairs and maintenance expenditure on property, plant and equipment 1.2 1.0
Trade receivables impairment – 0.1
Depreciation of owned property, plant and equipment 1.6 1.7
Amortisation of intangibles 0.1 0.4
Operating lease rentals – land and buildings 0.2 0.2
– plant, machinery and motor vehicles – 0.1
EXCEPTIONAL ITEMS
Staff costs of reorganising continuing operations 19 0.4 0.5
Third party costs of reorganising continuing operations 0.1 0.5
Proﬁt on disposal of property, plant and equipment (0.3) (1.8)
Net exceptional costs/(income) 0.2 (0.8)
Rental receivable under operating leases 0.2 0.3
SERVICES PROVIDED BY THE GROUP’S AUDITORS AND NETWORK FIRMS
During the period the Group obtained the following services from the Group’s auditors as detailed below:
2006 2005
£m £m
AUDIT SERVICES
– statutory audit 0.1 0.1 
OTHER ADVISORY FEES – 0.1 
0.1 0.2
Other advisory fees include fees charged in connection with restructuring during the period and professional advice on the Group’s transition to IFRS.
4. FINANCE COSTS
2006 2005
Interest receivable: £m £m 
Bank deposits – 0.1
2006 2005
Interest payable and similar charges: £m £m 
Bank loans and overdrafts 0.4 0.7
Exceptional bank facility fees 0.1 0.4
0.5 1.1
The exceptional bank facility fees comprise the amortised ongoing facility fees. These costs have been categorised as exceptional costs as they arose due to the
renegotiation of facilities in July 2004. 45 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
5. TAXATION
2006 2005
NOTE £m £m
The taxation credit/(charge) based on the proﬁt/(loss) before tax comprises:
Current period:
Current tax (0.1) (0.5)
Deferred tax 20 0.6 –
Total taxation 0.5 (0.5)
The taxation charge on exceptional items of £0.1m has arisen mainly due to the disposal of the Paddock Wood site during the period.
TAX ON ITEMS CHARGED TO EQUITY
Deferred tax on disposal of revalued properties 0.1 (1.0)
The difference between the total taxation shown above and the amount calculated by applying the standard rate of 
UK corporation tax to the proﬁt/(loss) before taxation is as follows: 2006 2005
£m £m
Proﬁt/(loss) before taxation 0.2 (1.1)
Taxation credit on loss at standard rate of corporation tax in the UK of 30% (2005: 30%) – 0.3
EFFECTS OF
Expenses not deductible for tax purposes (primarily disallowed expenses and depreciation on non-tax qualifying assets) – (0.1)
Difference between taxable gain and proﬁt on disposal of properties (0.1) (0.7)
Utilisation of losses carried forward from prior periods 0.6 –
Total taxation credit/(charge) 0.5 (0.5)
The Group earns its proﬁts solely in the UK. The tax rate used is a mixture of the standard rate for UK corporation tax, currently 30%, and the small companies 
rate, dependent on the level of proﬁts in each Group company.
6. PROFIT ATTRIBUTABLE TO MEMBERS OF THE PARENT COMPANY
The proﬁt dealt with in the ﬁnancial statements of the parent company was £nil (2005: £0.1m).
7. EARNINGS/(LOSS) PER SHARE
Earnings/(loss) per share has been calculated by dividing the earnings attributable to Ordinary shareholders by the weighted average number of Ordinary shares,
excluding shares held by the Universal Salvage plc 2000 Employees’ Share Trust which have been treated as cancelled.
For diluted earnings per share, the weighted average number of Ordinary shares in issue is adjusted to assume conversion of all dilutive potential Ordinary shares.
The Group has three classes of dilutive potential Ordinary shares: those share options granted to employees where the exercise price is less than the average market
price of the Company’s Ordinary shares during the year (‘SAYE options’), the contingently issuable shares under the Group’s Executive share option schemes, and
the warrant granted to The Royal Bank of Scotland plc in July 2004. 46 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED
7. EARNINGS/(LOSS) PER SHARE CONTINUED
2006 2005
WEIGHTED WEIGHTED
AVERAGE PER AVERAGE PER
NUMBER SHARE NUMBER SHARE
EARNINGS OF SHARES AMOUNT EARNINGS OF SHARES AMOUNT
GROUP £000 (‘000) (PENCE) £000 (‘000) (PENCE)
Basic earnings/(loss) per share:
Earnings/(loss) attributable to Ordinary shareholders 679 28,051 2.4 (1,624) 28,008 (5.8)
Effect of dilutive securities:
Executive/SAYE options – 367 – – – –
The Royal Bank of Scotland plc warrant – 998 (0.1) – – – 
Diluted earnings/(loss) per share:
Adjusted earnings/(loss) 679 29,416 2.3 (1,624) 28,008 (5.8)
8. STAFF AND DIRECTORS
2006 2005
£m £m
Staff costs:
Wages and salaries 7.9 7.8
Social security costs 0.8 0.8
Other pension costs 0.1 0.1
8.8 8.7
2006 2005
The average weekly number of employees during the period was as follows: NUMBER NUMBER
Site and transportation 164 163
Ofﬁce and management 160 159
324 322
KEY MANAGEMENT COMPENSATION
2006 2005
£m £m
Salaries and short-term beneﬁts 0.9 0.9
Termination beneﬁts 0.1 0.2
Share-based payments – –
1.0 1.1
The key management ﬁgures above include the Board of Directors.
DIRECTORS’ REMUNERATION
The Report on Directors’ Remuneration on pages 18 to 23 states the methods by which Directors are remunerated.
2006 2005
Directors’ remuneration in total: £000 £000
EMOLUMENTS
Fees and salaries 391 530
Beneﬁts in kind 4 8
Bonus 124 73
Compensation for loss of ofﬁce – 214
519 825
Pension contributions 26 37
545 862 47 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
8. STAFF AND DIRECTORS CONTINUED
The Group made contributions during the period on behalf of one (2005: ﬁve) of the Directors to the Group Personal Pension Plan and on behalf of one (2005: one)
of the Directors to a personal pension plan.
Details of individual Directors’ remuneration are shown in the Report on Directors’ Remuneration on pages 18 and 19.
9. PENSION AND OTHER POST-RETIREMENT BENEFITS 
The Group makes contributions towards a Group Personal Pension Plan that is open to all employees after a qualifying period of employment. In addition, the
Group makes contributions on behalf of certain Directors to speciﬁcally identiﬁed pension funds. These funds are of the deﬁned contribution type with assets held
in separate trustee administered funds.
Pension costs for deﬁned beneﬁt contribution schemes are as follows:
2006 2005
£m £m
Deﬁned contribution schemes 0.1 0.1
10. INTANGIBLE ASSETS
COMPUTER
SOFTWARE TOTAL
GROUP £m £m
Cost:
At 30 April 2005 5.0 5.0
At 29 April 2006 5.0 5.0
Amortisation:
At 30 April 2005 4.8 4.8
Charge for the year 0.1 0.1
At 29 April 2006 4.9 4.9
Net book amount:
At 29 April 2006 0.1 0.1
COMPUTER
SOFTWARE TOTAL
GROUP £m £m
Cost:
At 1 May 2004 4.9 4.9
Additions 0.1 0.1
At 30 April 2005 5.0 5.0
Amortisation:
At 1 May 2004 4.4 4.4
Charge for the year 0.4 0.4
At 30 April 2005 4.8 4.8
Net book amount:
At 30 April 2005 0.2 0.2
All amortisation costs in the year have been charged to administrative expenses. The useful life of computer software has been estimated at three years. 48 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
11. PROPERTY, PLANT AND EQUIPMENT
LAND, PLANT, OFFICE AND ASSETS IN
BUILDINGS AND MACHINERY AND COMPUTER COURSE OF
SITE IMPROVEMENTS MOTOR VEHICLES EQUIPMENT CONSTRUCTION TOTAL
GROUP £m £m £m £m £m
Cost or valuation:
At 30 April 2005 19.6 9.3 1.9 – 30.8
Additions 0.1 0.6 0.1 0.1 0.9
Disposals (0.7) (0.2) (0.1) – (1.0)
At 29 April 2006 19.0 9.7 1.9 0.1 30.7
Depreciation:
At 30 April 2005 0.4 6.0 1.7 – 8.1
Provided during the period 0.5 1.0 0.1 – 1.6
Disposals – (0.1) (0.1) – (0.2)
At 29 April 2006 0.9 6.9 1.7 – 9.5
Net book amount:
At 29 April 2006 18.1 2.8 0.2 0.1 21.2
LAND, PLANT, OFFICE AND ASSETS IN
BUILDINGS AND MACHINERY AND COMPUTER COURSE OF
SITE IMPROVEMENTS MOTOR VEHICLES EQUIPMENT CONSTRUCTION TOTAL
GROUP £m £m £m £m £m
Cost or valuation:
At 1 May 2004 24.3 10.1 1.9 – 36.3
Additions 0.2 0.3 – – 0.5
Transfers to current assets (0.1) – – – (0.1)
Disposals (4.8) (1.1) – – (5.9)
At 30 April 2005 19.6 9.3 1.9 – 30.8
Depreciation:
At 1 May 2004 – 6.0 1.4 – 7.4
Provided during the period 0.4 1.0 0.3 – 1.7
Disposals – (1.0) – – (1.0)
At 30 April 2005 0.4 6.0 1.7 – 8.1
Net book amount:
At 30 April 2005 19.2 3.3 0.2 – 22.7
Assets held under ﬁnance leases have the following net book value:
2006 2005
£m £m
Cost 0.5 0.2
Aggregate depreciation (0.2) (0.2)
Net book amount 0.3 –
Included in assets held under ﬁnance leases are a number of car transporters and the main ofﬁce building at our Westbury site. At the period end, the net book
amount of the transporters was £0.3m (2005: £nil), and the net book amount of the building was £nil (2005: £nil).
In accordance with IFRS1, ‘First time adoption of International Financial Reporting Standards’ and IAS17, ‘Leases’, the Group has reviewed the classiﬁcation of all
leases at 2 May 2004. In reviewing leases of land and buildings in accordance with IAS17 the land and buildings elements of the lease need to be considered
separately. On this basis, a lease on one property entered into in March 1990 has been classiﬁed as a ﬁnance lease in these accounts. This has resulted in an
increase in property, plant and equipment of £nil at 2 May 2004 and a ﬁnance lease creditor of £0.1m at the same date. Operating lease expense has been 
reduced by less than £1,000 in both periods.
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED 49 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
11. PROPERTY, PLANT AND EQUIPMENT CONTINUED
No interest was capitalised into property, plant and equipment in the 52 weeks to 29 April 2006 (2005: £nil). The total amount of ﬁnance costs included in the cost
of property, plant and equipment is £0.1m (2005: £0.1m).
The Group received a grant in prior years as a contribution towards the development of operating land. The total amount of grant deducted from the cost of land
and buildings is £0.6m (2005: £0.6m).
2006 2005
The net book amount of land and buildings comprises: £m £m
Revalued properties:
Freehold 17.9 18.5
Long leasehold 0.1 0.1
18.0 18.6
Additions since the last revaluation:
Freehold – –
Site improvements 0.1 0.1
18.1 18.7
2006 2005
The historical cost of freehold and leasehold land and buildings is as follows: £m £m
Cost 16.0 16.5
Cumulative depreciation based on cost 3.1 2.6
Included in land and buildings is land with a value of £13.8m (2005: £13.6m) which is not subject to depreciation.
The freehold and leasehold land and buildings were valued by DTZ Debenham Tie Leung, a ﬁrm of independent Chartered Surveyors, at 1 May 2004 based on a fair
value basis. In the main, the values were based on active market prices.
The Company had no property, plant and equipment at 29 April 2006 or 30 April 2005.
12. INVESTMENTS
COMPANY
2006 2005
Total investments: £m £m
Investments in subsidiary undertakings – valuation at 29 April 2006 and 30 April 2005 9.5 9.5
At ﬂotation, on 29 August 1995, the Directors valued the investments in subsidiary undertakings at their underlying net asset value.
The Company owns the entire Ordinary share capital of the following principal subsidiary undertakings, both of which are wholly owned, included in the
consolidation and are registered and operate in England and Wales:
NATURE OF BUSINESS
Userve Limited Service provider to the UK salvage and motor industries
Cornville Limited Retail motor repair and sales
13. INVENTORIES
2006 2005
GROUP £m £m
Vehicles or components for resale 3.3 2.8
Inventories of £3.3m (2005: £2.8m) are carried at the lower of net realisable value (being fair value less costs to sell) and purchase cost.
The Group consumed £36.8m (2005: £31.1m) of inventories during this period. During the period the Group charged £nil (2005: £nil) to cost of sales in relation to
inventory write-downs.
The Company had no inventory at 29 April 2006 or 30 April 2005. 50 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
14. TRADE AND OTHER RECEIVABLES
GROUP COMPANY
2006 2005 2006 2005
Amounts falling due within one year: £m £m £m £m
Trade receivables 2.2 2.9 – –
Less provision for impairment of receivables (0.1) (0.1) – –
Trade receivables – net 2.1 2.8 – –
Prepayments and accrued income 0.7 0.7 – –
2.8 3.5 – –
Concentrations of credit risk with respect to trade receivables are limited due to the Group’s customer base being large and unrelated. Due to this, management
believe there is no further credit risk provision required in excess of normal provision for impairment of receivables.
GROUP COMPANY
2006 2005 2006 2005
Amounts falling due after one year: £m £m £m £m
Corporation tax 0.1 0.1 0.1 0.1
Amounts owed by subsidiary undertakings – – 2.4 2.4
0.1 0.1 2.5 2.5
15. CASH AND CASH EQUIVALENTS
GROUP COMPANY
2006 2005 2006 2005
£m £m £m £m
Bank current accounts 1.8 – – –
16. TRADE AND OTHER PAYABLES – CURRENT
GROUP COMPANY
2006 2005 2006 2005
£m £m £m £m
Trade payables 2.2 3.0 – –
Other taxes and social security costs 1.1 0.8 – –
Accruals 2.7 2.4 – –
6.0 6.2 – –
17. CURRENT TAX LIABILITIES
GROUP COMPANY
2006 2005 2006 2005
£m £m £m £m
Corporation tax liabilities 0.2 0.7 0.1 0.2
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED 51 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
18. FINANCE LIABILITIES – BORROWINGS
GROUP COMPANY
2006 2005 2006 2005
£m £m £m £m
CURRENT
Net obligations under ﬁnance lease and hire purchase contracts 0.1 – – –
NON CURRENT
Overdraft – 0.2 – –
Bank loans 5.6 5.6 – –
Net obligations under ﬁnance lease and hire purchase contracts 0.3 0.1 – –
5.9 5.9 – –
The overdraft and bank loans are secured by a debenture and ﬁxed and ﬂoating charges over the assets of the Group.
The bank loan comprises a ten year facility of £5.6m of which £5.6m was drawn-down at 29 April 2006. It bears interest at 1.25% over LIBOR. The overdraft
comprises a £3.0m facility which bears interest at 1.25% over The Royal Bank of Scotland plc’s base rate.
The Group incurred issue costs of £0.7m in renegotiating the bank loan facility. These costs, together with the interest expense, are allocated to the Group income
statement over the term of the facility.
The effective interest rates at the balance sheet date were as follows:
2006 2005
FIXED FLOATING FIXED FLOATING
Bank overdraft – 5.8% – 6.0%
Bank borrowings – 5.9% 6.8% 6.2%
Finance lease 8.8% – 18.3% –
19. PROVISIONS
RESTRUCTURING
GROUP £m
At 30 April 2005 –
Charged/(credited) in the period 0.4
Utilised in the period (0.3)
At 29 April 2006 0.1
The restructuring provision is in connection with internal reorganisation costs to which the Group is commercially obliged, and is expected to be paid during the
ﬁrst half of the 52 weeks to 28 April 2007.
The Company had no provisions at 29 April 2006 and 30 April 2005.
20. DEFERRED TAX
Deferred tax is calculated in full on temporary differences under the liability method using a tax rate of 30% (2005: 30%).
The movement on the deferred tax account is as shown below:
2006 2005
GROUP £m £m
At 30 April 2005 1.7 2.7
Disposal of revalued properties (0.1) (1.0)
Income statement credit (0.6) –
At 29 April 2006 1.0 1.7 52 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED
20. DEFERRED TAX CONTINUED
A deferred tax asset of £0.6m (2005: £nil) has been recognised in respect of all tax losses and other temporary differences giving rise to deferred tax assets because
it is probable that these assets will be recovered in the foreseeable future.
The movements in deferred tax assets and liabilities (prior to the offsetting of balances within the same jurisdiction as permitted by IAS12) during the period are
shown below.
Deferred tax assets and liabilities are only offset where there is a legally enforceable right of offset and there is an intention to settle the balances net.
ACCELERATED
TAX DEPRECIATION OTHER TOTAL
Deferred tax liabilities £m £m £m
At 30 April 2005 – 1.7 1.7
Disposal of revalued properties – (0.1) (0.1)
At 29 April 2006 – 1.6 1.6
TAX LOSSES OTHER TOTAL
Deferred tax assets £m £m £m
At 30 April 2005 –––
Credited to income statement 0.4 0.2 0.6
At 29 April 2006 0.4 0.2 0.6
Net deferred tax liability
At 29 April 2006 1.0
At 30 April 2005 1.7
All of the deferred tax assets were available for offset against deferred tax liabilities and hence the net deferred tax provision at 29 April 2006 was £1.0m 
(2005: £1.7m).
The deferred tax liability due after more than one year is £1.0m (2005: £1.7m).
The deferred taxation (liability)/asset recognised in the ﬁnancial statements is as follows:
AMOUNT AMOUNT
RECOGNISED UNRECOGNISED
2006 2005 2006 2005
GROUP £m £m £m £m
Tax effect of timing differences:
Accelerated capital allowances 0.2 – – 0.3
Asset revaluations (1.3) (1.4) – –
Capital gains (0.3) (0.3) – –
Unrelieved tax losses carried forward to future periods 0.4 – – 0.4
(Liability)/asset (1.0) (1.7) – 0.7
Based on current capital investment plans, the Group expects that in future years capital allowances will be lower than depreciation.
Full provision has been made for deferred tax on gains recognised on revaluing property to its market value and on the sale of properties where potentially taxable
gains have been rolled over into replacement assets. Such tax would become payable if the property were sold without it being possible to claim rollover relief. 53 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
21. FINANCIAL INSTRUMENTS
Numerical ﬁnancial instruments disclosures are set out below. Additional disclosures are set out in the accounting policies relating to risk management.
ASSETS LIABILITIES
£m £m
At 29 April 2006
Interest rate swaps ––
Embedded derivatives ––
––
ASSETS LIABILITIES
£m £m
At 30 April 2005
Interest rate swaps – (0.1)
Embedded derivatives ––
– (0.1)
In accordance with IAS39 ‘Financial Instruments: Recognition and Measurement’, the Group has reviewed all contracts for embedded derivatives that are required to
be accounted for separately if they do not meet certain requirements as set out in the standard.
NET FAIR VALUES OF DERIVATIVE FINANCIAL INSTRUMENTS
The net fair value of the derivatives designated for cash ﬂow hedges at the balance sheet date were:
BOOK VALUE FAIR VALUE
2006 2005 2006 2005
£m £m £m £m
Contracts with negative fair values:
Interest rate swaps – (0.1) – (0.1)
The notional principal amount of the outstanding interest rate swap contracts at 29 April 2006 was £nil (2005: £4.0m).
At 29 April 2006 the ﬁxed interest rate is nil% (2005: 6.84%) and ﬂoating rates are 5.9% (LIBOR plus 1.25%). The loss deferred in equity has reversed in the Group
income statement in April 2006 (being the early termination of the swap).
FAIR VALUE OF NON-CURRENT BORROWINGS
The Group held the following categories of ﬁnancial instruments as at 29 April 2006:
BOOK VALUE FAIR VALUE
2006 2005 2006 2005
NOTE £m £m £m £m
Long-term borrowings 18 5.9 5.9 6.2 6.5
FAIR VALUE OF OTHER FINANCIAL ASSETS AND LIABILITIES
FINANCIAL INSTRUMENTS HELD TO FUND THE GROUP’S OPERATIONS
Short-term borrowings 18 0.1 – 0.1 – 
Trade and other payables 16 6.0 6.2 6.0 6.2
Trade and other receivables 14 2.8 3.5 2.8 3.5
Cash and cash equivalents 15 1.8 – 1.8 – 
The Company had no non current borrowings.
The fair value of the long-term borrowings are based on cash ﬂows discounted using a rate based on borrowings of 5.9% (2005: 5.9%). All interest on borrowings is
tax deductible. 54 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED
21. FINANCIAL INSTRUMENTS CONTINUED
MATURITY OF FINANCIAL LIABILITIES
The maturity proﬁle of the Group’s ﬁnancial liabilities at 29 April 2006 was as follows:
2006 2005
DEBT FINANCE LEASES TOTAL DEBT FINANCE LEASES TOTAL
£m £m £m £m £m £m
Within one year – 0.1 0.1 –––
Between one and two years 1.9 0.1 2.0 1.0 – 1.0
Between two and ﬁve years 3.0 0.1 3.1 3.0 – 3.0
Over ﬁve years 0.7 0.1 0.8 1.8 0.1 1.9
5.6 0.4 6.0 5.8 0.1 5.9
BORROWING FACILITIES
The Group had the following undrawn borrowing facilities available at 29 April 2006 in respect of which all conditions precedent relating to bank covenants had
been met at that date:
2006 2005
FLOATING FIXED TOTAL TOTAL
£m £m £m £m
Expiring within one year ––– –
Expiring between one and two years 3.0 – 3.0 2.9
Expiring in more than two years ––– –
3.0 – 3.0 2.9
The minimum lease payments under ﬁnance leases fall due as follows:
2006 2005
£m £m
No later than one year 0.1 –
Between one and ﬁve years 0.2 –
More than ﬁve years 0.2 0.2
0.5 0.2
Future ﬁnance charges on ﬁnance leases (0.1) (0.1)
Present value of ﬁnance lease liabilities 0.4 0.1
22. SHARE CAPITAL
2006 2005
COMPANY AND GROUP £m £m
Authorised:
36,000,000 Ordinary shares of 10 pence each 3.6 3.6
Issued and fully paid:
28,442,558 (2005: 28,258,098) Ordinary shares of 10 pence each 2.8 2.8
During the period 184,460 shares were issued by the Company regarding SAYE options which were exercised during the year. 55 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
22. SHARE CAPITAL CONTINUED
POTENTIAL ISSUE OF ORDINARY SHARES
Certain Directors and senior managers hold options to subscribe for shares in the Company at prices ranging from 61.0 pence to 479.5 pence under the share
option schemes detailed in the Report on Directors Remuneration on pages 18 to 23. No options under these schemes were exercised in 2006 (2005: nil).
The number of shares subject to options, the periods in which they are granted and the periods in which they may be exercised are given below:
EXERCISE PRICE EXERCISE 2006 2005
YEAR OF GRANT (PENCE) PERIOD NUMBERS NUMBERS
52 weeks to 29 April 2000 247.5 2003 to 2010 75,557 100,607
52 weeks to 28 April 2001 310.0 2003 to 2010 15,322 15,322
52 weeks to 27 April 2002 479.5 2004 to 2008 26,329 45,620
53 weeks to 3 May 2003 210.0 2005 to 2009 25,000 50,000
53 weeks to 3 May 2003 127.0 2005 to 2009 20,000 40,000
53 weeks to 3 May 2003 101.0 2006 to 2013 50,000 50,000
52 weeks to 1 May 2004 97.0 2007 to 2014 – 100,000
52 weeks to 30 April 2005 61.0 2007 to 2011 50,000 150,000
52 weeks to 29 April 2006 94.0 2008 to 2015 340,000 – 
602,208 551,549
The middle market price of the Company’s shares on 28 April 2006 was 125.0 pence. The highest price in the year was 139.0 pence and the lowest price was 
74.5 pence.
At 29 April 2006, the following options granted under the Executive share option schemes and the SAYE share option schemes were outstanding with a total
nominal amount of £0.1m (2005: £0.2m). 184,460 options were exercised during the year (2005: nil).
DATE OF ORDINARY SHARES EXERCISE PRICE PERIOD DURING WHICH
SCHEME GRANT UNDER OPTION (PENCE) OPTION IS EXERCISABLE
1995 Executive Scheme 06.04.2000 12,929 247.5 between 06.04.2003 and 06.04.2007
2000 Executive Scheme 06.04.2000 62,628 247.5 between 06.04.2003 and 05.04.2010
1995 Executive Scheme 11.07.2000 5,645 310.0 between 11.07.2003 and 11.07.2007
2000 Executive Scheme 11.07.2000 9,677 310.0 between 11.07.2003 and 10.07.2010
1995 Executive Scheme 18.07.2001 26,329 479.5 between 18.07.2004 and 18.07.2008
SAYE 11 21.12.2001 7,384 381.0 between 01.02.2007 and 31.07.2007
1995 Executive Scheme 05.07.2002 25,000 210.0 between 05.07.2005 and 05.07.2009
1995 Executive Scheme 10.12.2002 20,000 127.0 between 10.12.2005 and 10.12.2009
SAYE 13 20.12.2002 85,320 78.0 between 01.02.2008 and 31.07.2008
1995 Executive Scheme 09.04.2003 20,298 101.0 between 09.04.2006 and 09.04.2010
2000 Executive Scheme 09.04.2003 29,702 101.0 between 09.04.2006 and 08.04.2013
1995 Executive Scheme 29.07.2004 50,000 61.0 between 29.07.2007 and 28.07.2011
SAYE 14 01.01.2005 476,108 60.0 between 01.03.2008 and 31.08.2008
SAYE 15 01.01.2005 79,424 60.0 between 01.03.2010 and 31.08.2010
2004 Approved Executive Scheme 22.07.2005 71,914 94.0 between 22.07.2008 and 22.07.2015
2004 Unapproved Executive Scheme 22.07.2005 268,086 94.0 between 22.07.2008 and 22.07.2015
1,250,444
The number of options exercisable under the Executive share option schemes is dependent upon criteria detailed in the Report on Directors’ Remuneration on 
pages 18 to 23. 56 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
23. SHARE-BASED PAYMENTS
SAYE SCHEME
The 1995 Savings-Related Share Option Scheme terminated in August 2005 and options can no longer be granted from this scheme.
UNIVERSAL SALVAGE PLC INLAND REVENUE APPROVED COMPANY SHARE PLAN 2004 (THE ‘NEW APPROVED PLAN’) AND UNIVERSAL SALVAGE PLC 
NON-INLAND REVENUE APPROVED SHARE OPTION PLAN 2004 (THE ‘NEW UNAPPROVED PLAN’)
Under the New Approved Plan and New Unapproved Plan it is the intention of the Remuneration Committee to grant share options annually (subject to headroom
availability) to Executive Directors and senior managers to reward past performance and incentivise future performance. Options are granted with a ﬁxed exercise
price equal to the average middle market price of the shares under option at the date of grant. Such options require that future performance targets are met before
they can be exercised.
UNIVERSAL SALVAGE 2000 APPROVED EXECUTIVE SHARE OPTION SCHEME AND 1995 EXECUTIVE SHARE OPTION SCHEME
These schemes terminated in March 2005 and no further options can be granted from these schemes.
The weighted average share price during the period for options exercised over the year was 78.0 pence (2005: n/a). The total charge for the year relating to
employee share-based payment plans was £0.1m (2005: £0.1m), all of which related to equity settled share-based payment transactions. After deferred tax, the
total charge was £0.1m (2005: £0.1m).
Options were valued using the Black-Scholes option pricing model. No performance conditions were included in the fair value calculations. All options are equity
settled. The fair value per option granted and the assumptions used in the calculation are as follows:
SAYE SCHEME 12 SAYE SCHEME 13
2006 2005 2006 2005
Grant date – 20.12.02 20.12.02 20.12.02
Share price at grant date (pence) – 135.0 135.0 135.0
Exercise price (pence) – 78.0 78.0 78.0
Number of employees – 57 13 17
Shares under option – 181,799 85,320 108,061
Vesting period (years) – 3 5 5
Expected volatility – 45% 45% 45%
Option life (years) – 3.5 5.5 5.5
Expected life (years) – 3.25 5.25 5.25
Risk free rate – 4.07% 4.29% 4.29%
Expected dividends expressed as dividend yield – 3.70% 3.70% 3.70%
Possibility of ceasing employment before vesting – 20% 30% 30%
Fair value per option (pence) – 61.5 63.3 63.3
SAYE SCHEME 14 SAYE SCHEME 15
2006 2005 2006 2005
Grant date 01.01.05 01.01.05 01.01.05 01.01.05
Share price at grant date (pence) 74.5 74.5 74.5 74.5
Exercise price (pence) 60.0 60.0 60.0 60.0
Number of employees 95 112 12 16
Shares under option 476,108 532,322 79,424 121,286
Vesting period (years) 3 3 5 5
Expected volatility 45% 45% 45% 45%
Option life (years) 3.5 3.5 5.5 5.5
Expected life (years) 3.25 3.25 5.25 5.25
Risk free rate 4.38% 4.38% 4.42% 4.42%
Expected dividends expressed as dividend yield 0% 0% 0% 0%
Possibility of ceasing employment before vesting 20% 20% 30% 30%
Fair value per option (pence) 33.0 33.0 39.5 39.5
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED 57 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
23. SHARE-BASED PAYMENTS CONTINUED
1995 UNAPPROVED SCHEME 1995 UNAPPROVED SCHEME 2000 APPROVED SCHEME
2006 2005 2006 2005 2006 2005
Grant date 10.12.02 10.12.02 09.04.03 09.04.03 09.04.03 09.04.03
Share price at grant date (pence) 137.5 137.5 101.0 101.0 101.0 101.0
Exercise price (pence) 127.0 127.0 101.0 101.0 101.0 101.0
Number of employees 1 2 1 1 1 1
Shares under option 20,000 40,000 20,298 20,298 29,702 29,702
Vesting period (years) 3 3 3 3 3 3
Expected volatility 45% 45% 45% 45% 45% 45%
Option life (years) 3 to 7 3 to 7 3 to 7 3 to 7 3 to 10 3 to 10
Expected life (years) 5 5 5 5 6.5 6.5
Risk free rate 4.36% 4.36% 4.14% 4.14% 4.30% 4.30%
Expected dividends expressed as dividend yield 3.8% 3.8% 5% 5% 5% 5%
Possibility of ceasing employment before vesting 0% 0% 0% 0% 0% 0%
Fair value per option (pence) 47.6 47.6 29.3 29.3 30.7 30.7
1995 UNAPPROVED SCHEME 2004 NEW APPROVED SCHEME         2004 NEW UNAPPROVED SCHEME
2006 2005 2006 2005 2006 2005
Grant date 29.07.04 29.07.04 22.07.05 – 22.07.05 – 
Share price at grant date (pence) 61.0 61.0 100.5 – 100.5 – 
Exercise price (pence) 61.0 61.0 94.0 – 94.0 – 
Number of employees 1 1 4 – 4 – 
Shares under option 50,000 50,000 71,914 – 268,086 – 
Vesting period (years) 3 3 3 – 3 – 
Expected volatility 45% 45% 45% – 45% –
Option life (years) 3 to 7 3 to 7 3 to 10 – 3 to 10 – 
Expected life (years) 5 5 6.5 – 6.5 – 
Risk free rate 5.17% 5.17% 4.17% – 4.17% – 
Expected dividends expressed as dividend yield 2% 2% 0% – 0% – 
Possibility of ceasing employment before vesting 0% 0% 0% – 0% – 
Fair value per option (pence) 24.0 24.0 53.2 – 53.2 –
Expected volatility has been estimated at each grant date using prior period share price data. The expected life of each batch of options is based on an exercise 
date that falls on the median of the available exercise window. The risk free rate has been extracted from the Bank of England website using the yield from British
Government Securities (nominal zero coupon) for a period matching the life of the relevant options.
A reconciliation of option movements over the period to 29 April 2006 is given below:
2006 WEIGHTED AVERAGE 2005 WEIGHTED AVERAGE
NUMBER EXERCISE PRICE NUMBER EXERCISE PRICE
(’000) (PENCE) (’000) (PENCE)
Outstanding at 30 April 2005 1,539 106.0 1,319 182.9
Granted 340 94.0 819 60.2
Forfeited (445) 121.7 (599) 212.5
Exercised (184) 78.0 – n/a
Outstanding at 29 April 2006 1,250 101.3 1,539 106.0
Exercisable at 29 April 2006 – n/a 3 381.0 58 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED
23. SHARE-BASED PAYMENTS CONTINUED
2006
WEIGHTED AVERAGE
EXERCISE PRICE NUMBER OF WEIGHTED AVERAGE REMAINING LIFE
RANGE OF EXERCISE PRICES (PENCE) (PENCE) SHARES (YEARS) (YEARS)
EXPECTED CONTRACTUAL
60.0 to 100.0 72.8 1,030,852 5.0 5.0
100.1 to 200.0 108.4 70,000 4.8 6.2
200.1 to 300.0 238.2 100,557 – 3.4
300.1 to 400.0 333.1 22,706 0.4 2.5
400.1 to 500.0 479.5 26,329 – 2.3
2005
WEIGHTED AVERAGE
EXERCISE PRICE NUMBER OF WEIGHTED AVERAGE REMAINING LIFE
RANGE OF EXERCISE PRICES (PENCE) (PENCE) SHARES (YEARS) (YEARS)
EXPECTED CONTRACTUAL
60.0 to 100.0 67.5 1,209,259 3.4 4.1
100.1 to 200.0 112.6 90,000 6.8 6.8
200.1 to 300.0 235.1 150,607 – 4.2
300.1 to 400.0 324.0 43,881 0.9 2.4
400.1 to 500.0 479.5 45,620 – 3.3
24. OTHER RESERVES
REVALUATION HEDGING
RESERVE RESERVE TOTAL
GROUP £m £m £m
At 1 May 2004 5.4 (0.1) 5.3
Realised revaluation on sale of properties (3.2) – (3.2)
Deferred tax on revalued land and buildings 1.0 – 1.0
At 30 April 2005 3.2 (0.1) 3.1
Cash ﬂow hedges – fair values gained in period – 0.1 0.1
Realised revaluation on sale of properties (0.2) – (0.2)
Transfer of amount equivalent to additional depreciation on revalued assets (0.1) – (0.1)
Deferred tax on revalued land and buildings 0.1 – 0.1
At 29 April 2006 3.0 – 3.0
REVALUATION
RESERVE TOTAL
COMPANY £m £m
At 1 May 2004 6.7 6.7
At 30 April 2005 6.7 6.7
At 29 April 2006 6.7 6.7 59 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
25. STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY
SHARE
SHARE PREMIUM OTHER RETAINED SHAREHOLDERS’
CAPITAL ACCOUNT RESERVES EARNINGS FUNDS
GROUP £m £m £m £m £m
At 1 May 2004 2.8 1.2 5.3 6.0 15.3 
Share options – value of employee services – – – 0.1 0.1 
Realised revaluation on sale of properties – – (3.2) 3.2 – 
Deferred tax on revalued land and buildings – – 1.0 – 1.0 
Loss after taxation – – – (1.6) (1.6)
At 30 April 2005 2.8 1.2 3.1 7.7 14.8
SHARE
SHARE PREMIUM OTHER RETAINED SHAREHOLDERS’
CAPITAL ACCOUNT RESERVES EARNINGS FUNDS
GROUP £m £m £m £m £m
At 30 April 2005 2.8 1.2 3.1 7.7 14.8 
Share options – proceeds from issued shares – 0.1 – – 0.1 
Realised revaluation on sale of properties – – (0.2) 0.2 – 
Transfer of amount equivalent to additional depreciation on revalued assets – – (0.1) 0.1 – 
Deferred tax on revalued land and buildings – – 0.1 – 0.1 
Proﬁt after taxation – – – 0.7 0.7 
Cash ﬂow hedges – fair value gains in period – – 0.1 – 0.1 
At 29 April 2006 2.8 1.3 3.0 8.7 15.8
SHARE
SHARE PREMIUM OTHER RETAINED SHAREHOLDERS’
CAPITAL ACCOUNT RESERVES EARNINGS FUNDS
COMPANY £m £m £m £m £m
At 1 May 2004 2.8 1.2 6.7 1.0 11.7 
Proﬁt after taxation – – – 0.1 0.1 
At 30 April 2005 2.8 1.2 6.7 1.1 11.8
SHARE
SHARE PREMIUM OTHER RETAINED SHAREHOLDERS’
CAPITAL ACCOUNT RESERVES EARNINGS FUNDS
COMPANY £m £m £m £m £m
At 30 April 2005 2.8 1.2 6.7 1.1 11.8 
Share options – proceeds from issued shares – 0.1 – – 0.1 
At 29 April 2006 2.8 1.3 6.7 1.1 11.9
Interests in own shares represents the cost of 250,000 of the Company’s Ordinary shares (nominal value of £25,000) – 100,000 purchased in June 2000 and
150,000 purchased in July 2002. These shares were acquired by the Universal Salvage plc 2000 Employees’ Share Trust. The costs of funding and administering the
scheme are charged to the income statement of the Company in the period to which they relate. The market value of the shares at 29 April 2006 was £0.3m 
(2005: £0.2m). The Universal Salvage plc 2000 Employees’ Share Trust has waived its right to dividends.
26. CAPITAL COMMITMENTS
2006 2005
GROUP £m £m
Contracted not provided 0.3 0.1
The Company had no capital commitments at either year-end. 60 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED
27. OTHER FINANCIAL COMMITMENTS
At 29 April 2006, the Group had total commitments under non-cancellable operating leases as set out below:
LAND AND BUILDINGS OTHER
2006 2005 2006 2005
£m £m £m £m
Operating leases which expire:
Not later than one year – – – – 
Later than one year, not later than ﬁve years 0.2 0.2 – – 
Later than ﬁve years 5.6 5.7 – –
5.8 5.9 – –
The Company had no other ﬁnancial commitments at either year-end.
28. RELATED PARTY TRANSACTIONS
The following transactions between the holding company and its subsidiaries occurred during the period:
•
The Company incurred staff and other administrative expenses which were paid by the main trading subsidiary, Userve Limited, amounting to £0.7m.
•
The Company levied a recharge for management services to Userve Limited of £0.8m.
•
Userve Limited paid the Company’s corporation tax liability of £0.2m relating to the 52 weeks to 30 April 2005.
•
Userve Limited received a cash inﬂow relating to the Company’s SAYE options exercised during the period, amounting to £0.1m.
At the year-end, the Company’s records showed inter-company debtors of £2.0m owed by Userve Limited and £0.3m owed by Cornville Limited.
29. RECONCILIATION OF OPERATING PROFIT/(LOSS) TO CASH GENERATED FROM OPERATIONS
2006 2005
GROUP £m £m
Operating proﬁt/(loss) 0.7 (0.1)
Depreciation of property, plant and equipment 1.6 1.7
Amortisation of intangibles 0.1 0.4
Proﬁt on disposal of property, plant and equipment (0.3) (1.8)
Changes in working capital:
Increase in inventories (0.4) (0.6)
Decrease/(increase) in receivables due within one year 0.7 (0.3)
Increase/(decrease) in payables due within one year 0.1 (0.6)
Cash generated from operations 2.5 (1.3)
30. POST BALANCE SHEET EVENTS
In May 2006, the Group disposed of its site at Staughton Moor in Cambridgeshire. The Group received consideration of £0.25m for this site and realised a book
proﬁt of £0.1m excluding disposal costs. 61 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
31. RECONCILIATION OF NET ASSETS AND PROFIT UNDER UK GAAP TO IFRS
In the prior year, Universal Salvage plc reported under UK GAAP for the 52 weeks to 30 April 2005. The analysis below shows a reconciliation of net assets and
proﬁt as reported under UK GAAP as at 30 April 2005 to the revised net assets and proﬁt under IFRS as reported in these ﬁnancial statements. In addition, there is
a reconciliation of net assets under UK GAAP to IFRS at the transition date for the Group, being 2 May 2004.
GROUP COMPANY
2005 2005
RECONCILIATION OF PROFIT/(LOSS) BEFORE INTEREST NOTE £m £m
Proﬁt before interest as reported under UK GAAP 2.5 0.1
Property, plant and equipment – depreciation effects due to introduction of residual values (f) 0.1 – 
Property, plant and equipment – depreciation effects due to application of fair values (e) 0.1 – 
Share-based payments (d) (0.1) – 
Proﬁt on disposal of property, plant and equipment (e) (2.7) – 
(Loss)/proﬁt before interest as reported under IFRS (0.1) 0.1
GROUP COMPANY
2005 2005
RECONCILIATION OF PROFIT/(LOSS) AFTER TAXATION NOTE £m £m
Proﬁt after taxation as reported under UK GAAP 1.0 0.1
Property, plant and equipment – depreciation effects due to introduction of residual values (f) 0.1 – 
Property, plant and equipment – depreciation effects due to application of fair values (e) 0.1 – 
Share-based payments (d) (0.1) – 
Proﬁt on disposal of property, plant and equipment (e) (2.7) – 
(Loss)/proﬁt after taxation as reported under IFRS (1.6) 0.1
UK EFFECT OF
RECONCILIATION OF PROFIT/(LOSS) FOR THE 52 WEEKS TO 30 APRIL 2005 GAAP TRANSITION IFRS
GROUP NOTE £m £m £m
Revenue 49.7 –  49.7
Cost of sales (f) (39.7) 0.1 (39.6)
Gross proﬁt 10.0 0.1 10.1
Administrative costs – before exceptional items (11.0) –  (11.0)
– exceptional items (e) 3.5 (2.7) 0.8
Operating proﬁt/(loss) 2.5 (2.6) (0.1)
Finance costs – net (1.0) – (1.0)
Taxation (0.5) –  (0.5)
Net proﬁt/(loss) 1.0 (2.6) (1.6) 62 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED
31. RECONCILIATION OF NET ASSETS AND PROFIT UNDER UK GAAP TO IFRS CONTINUED
UK EFFECT OF
RECONCILIATION OF EQUITY AT DATE OF TRANSITION – 2 MAY 2004 GAAP TRANSITION IFRS
GROUP NOTE £m £m £m
Property, plant and equipment (c), (e), (f) 26.3 2.6 28.9
Intangibles (g) – 0.5 0.5
Total non current assets 26.3 3.1 29.4
Inventories 2.1 – 2.1
Trade and other receivables 3.6 – 3.6
Total current assets 5.7 – 5.7
Total assets 32.0 3.1 35.1
Financial liabilities (c) (10.3) (0.1) (10.4)
Trade and other payables (b), (h) (6.2) (0.1) (6.3)
Provisions (0.4) – (0.4)
Deferred tax liabilities (a) – (2.7) (2.7)
Total liabilities (16.9) (2.9) (19.8)
Total assets less total liabilities 15.1 0.2 15.3
Share capital 2.8 – 2.8
Share premium 1.2 – 1.2
Other reserves (b) 5.0 0.3 5.3
Retained earnings (d) 6.1 (0.1) 6.0
Total shareholders’ equity 15.1 0.2 15.3
UK EFFECT OF
RECONCILIATION OF EQUITY AT 30 APRIL 2005 GAAP TRANSITION IFRS
GROUP NOTE £m £m £m
Property, plant and equipment (c), (e), (f) 22.3 0.4 22.7
Intangibles (g) – 0.2 0.2
Total non current assets 22.3 0.6 22.9
Inventories 2.8 – 2.8
Trade and other receivables 3.5 – 3.5
Total current assets 6.3 – 6.3
Non current assets
Trade and other receivables 0.1 – 0.1
Total assets 28.7 0.6 29.3
Financial liabilities (5.9) – (5.9)
Trade and other payables (b), (h) (6.0) (0.2) (6.2)
Current tax liabilities (0.7) – (0.7)
Deferred tax liabilities (a) – (1.7) (1.7)
Total liabilities (12.6) (1.9) (14.5)
Total assets less total liabilities 16.1 (1.3) 14.8
Share capital 2.8 – 2.8
Share premium 1.2 – 1.2
Other reserves (b) 4.3 (1.2) 3.1
Retained earnings (d) 7.8 (0.1) 7.7
Total shareholders’ equity 16.1 (1.3) 14.8 63 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
31. RECONCILIATION OF NET ASSETS AND PROFIT UNDER UK GAAP TO IFRS CONTINUED
UK EFFECT OF
RECONCILIATION OF EQUITY AT DATE OF TRANSITION – 2 MAY 2004 GAAP TRANSITION IFRS
COMPANY £m £m £m
Investments 9.5 – 9.5
Total non current assets 9.5 – 9.5
Trade and other receivables 2.2 – 2.2
Total current assets 2.2 – 2.2
Total assets 11.7 – 11.7
Total liabilities – – –
Total assets less total liabilities 11.7 – 11.7
Share capital 2.8 – 2.8
Share premium 1.3 – 1.3
Other reserves 6.7 – 6.7
Retained earnings 0.9 – 0.9
Total shareholders’ equity 11.7 – 11.7
UK EFFECT OF
RECONCILIATION OF EQUITY AT 30 APRIL 2005 GAAP TRANSITION IFRS
COMPANY £m £m £m
Investments 9.5 – 9.5
Total non current assets 9.5 – 9.5
Trade and other receivables 2.5 – 2.5
Total current assets 2.5 – 2.5
Total assets 12.0 – 12.0
Trade and other payables (0.2) – (0.2)
Total liabilities (0.2) – (0.2)
Total assets less total liabilities 11.8 – 11.8
Share capital 2.8 – 2.8
Share premium 1.2 – 1.2
Other reserves 6.7 – 6.7
Retained earnings 1.1 – 1.1
Total shareholders’ equity 11.8 – 11.8 64 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
31. RECONCILIATION OF NET ASSETS AND PROFIT UNDER UK GAAP TO IFRS CONTINUED
EXPLANATION OF RECONCILING ITEMS BETWEEN UK GAAP AND IFRS
(a) In accordance with IAS12, provision has been made for deferred tax on revalued assets. This was not permitted under UK GAAP unless there was a binding
commitment to sell the asset.
(b) In accordance with IAS39, derivatives held by the entity have to be carried at fair value with movements in the fair value being taken to the income statement
or currency reserves dependent on instrument classiﬁcation. In the case of the Group, the only derivative it held at 2 May 2004 and 30 April 2005 was a cash
ﬂow hedge and hence any movement in fair value was taken to the hedging reserve.
(c) As disclosed in note 11, the Group has identiﬁed one lease that was classiﬁed as an operating lease for land and buildings under UK GAAP, which under IFRS
requires reclassiﬁcation as a ﬁnance lease (in respect of the building element of the lease). The reclassiﬁcation of this operating lease to a ﬁnance lease resulted
in the recognition of buildings with a net book value of £nil at 2 May 2004. At the same date a ﬁnance lease liability of £0.1m was recognised.
(d) Under IFRS2, a charge is required for all share-based payments including share options. The charge in the income statement is based on the fair value of the
options at grant date. Under UK GAAP, the income statement charge, if any, is based on the difference between the exercise price and the middle market price
on the date of issue. In the 52 weeks to 30 April 2005, a charge of £0.1m (£0.1m after taxation) was required under IFRS2. There is no impact on net assets.
(e) In accordance with IAS16, where entities have adopted a policy of revaluation for certain classes of assets, there is a requirement to value these assets on 
a fair value basis. The Group periodically revalues its freehold and leasehold land and buildings and was therefore required to employ the services of a ﬁrm of
independent Chartered Surveyors to value this class of assets on a fair value basis. This resulted in an increase in the net book amount at 2 May 2004 of £3.0m
and at 30 April 2005 of £0.4m. As a result of the increased valuation of these assets under IFRS, the net book amount of land and buildings disposed during the
52 weeks to 30 April 2005 was higher and therefore the proﬁt recognised on these disposals was reduced by £2.7m.
(f) Under IAS16, entities are required to consider residual values when applying depreciation policy. The effect of applying this standard was to increase the net
book amount of property, plant and equipment at 2 May 2004 by £0.1m and at 30 April 2005 by £0.1m. Depreciation charges were reduced in the 52 weeks
to 30 April 2005 by £0.1m.
(g) Intangible assets were classiﬁed under ofﬁce and computer equipment within the ﬁxed assets note under UK GAAP. These have now been reclassiﬁed as
intangible assets. £0.5m was reclassiﬁed at 2 May 2004 (£0.2m at 30 April 2005).
(h) In accordance with IAS19, a liability for holiday pay has been recognised at 2 May 2004 of less than £0.1m and at 30 April 2005 of £0.1m.
Notes to the Financial Statements
AT 29 APRIL 2006 CONTINUED 65 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Five Y ear Financial Record
IFRS IFRS UK GAAP UK GAAP UK GAAP UK GAAP
2006 2005 2005 2004 2003 2002
GROUP £m £m £m £m £m £m
Revenue 56.4 49.7 49.7 48.4 61.3 72.0
Cost of sales – before exceptional items (45.6) (39.6) (39.7) (39.4) (46.2) (51.4)
– exceptional items – – – (0.1) (0.1) – 
Gross  proﬁt 10.8 10.1 10.0 8.9 15.0 20.6
Administrative expenses – before exceptional items (9.9) (11.0) (11.0) (12.9) (13.2) (13.2)
– exceptional items (0.2) 0.8 (1.0) (5.1) (0.7) (0.7)
Operating proﬁt/(loss) – before exceptional items 0.9 (0.9) (1.0) (4.0) 1.8 7.4
– after exceptional items 0.7 (0.1) (2.0) (9.1) 1.0 6.7
Non-operating exceptional items – – 4.5 – – 0.1
Proﬁt/(loss) before interest
– before exceptional items 0.9 (0.9) (1.0) (4.0) 1.8 7.4
– after exceptional items 0.7 (0.1) 2.5 (9.1) 1.0 6.8
Interest – before exceptional items (0.4) (0.6) (0.6) (0.5) (0.4) (0.3)
Interest - exceptional items - bank facility fees (0.1) (0.4) (0.4) – – –
Proﬁt/(loss) before taxation
– before exceptional items 0.5 (1.5) (1.6) (4.5) 1.4 7.1
– after exceptional items 0.2 (1.1) 1.5 (9.6) 0.6 6.5
Taxation 0.5 (0.5) (0.5) 1.5 (0.3) (2.0)
Proﬁt/(loss) after taxation 0.7 (1.6) 1.0 (8.1) 0.3 4.5
Net assets 15.8 14.8 16.1 15.1 23.3 24.0
The impact of transition from UK GAAP to IFRS is included in note 31.
Statistics
IFRS IFRS UK GAAP UK GAAP UK GAAP UK GAAP
GROUP 2006 2005 2005 2004 2003 2002
Basic earnings/(loss) per Ordinary share (pence) 2.4p (5.8p) 3.5p (29.1p) 1.1p 16.2p
Diluted earnings/(loss) per Ordinary share (pence) 2.3p (5.8p) 3.5p (29.1p) 1.1p 15.9p
Dividends per Ordinary share (pence) – – – 1.2p 2.5p 5.0p
Gross proﬁt margin 19.1% 20.3% 20.2% 18.3% 24.3% 28.7%
Operating proﬁt margin 1.2% (0.2%) (4.1%) (18.9%) 1.6% 9.3%
Gearing 26.6% 39.9% 35.9% 68.3% 28.7% 24.4% 66 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notice of Annual General Meeting
Notice is hereby given that the Annual General Meeting of Universal Salvage plc (the ‘Company’) will be held at
Hiscox plc, 1 Great St Helen’s, London EC3A 6HX on 27 September 2006 at 12.00 noon for the purpose of
transacting the following business:
1. To receive and adopt the Company’s annual accounts for the 52 weeks to 29 April 2006, the Directors’ Report,
and the Auditors’ Report on those accounts and the auditable part of the Report on Directors’ Remuneration.
2. To receive and adopt the Report on Directors’ Remuneration for the 52 weeks to 29 April 2006.
3. To elect Mr N C Stead, who retires following his appointment since the last Annual General Meeting,
as a Director.
4. To elect Mr R B Mead, who retires following his appointment since the last Annual General Meeting,
as a Director.
5. To re-elect Mr A N Foster, who retires by rotation and offers himself for reappointment under the 
Company’s Articles of Association, as a Director.
6. To re-elect Mr A F Somerville, who retires by rotation and offers himself for reappointment under the
Company’s Articles of Association, as a Director.
7. To reappoint the auditors, and authorise the Directors to ﬁx the remuneration of the auditors for the 
ensuing year.
To consider and, if thought ﬁt, pass the following resolutions which will be proposed, in the case of Resolution 8,
as an Ordinary Resolution and, in the case of Resolutions 9, 10 and 11, as Special Resolutions:
8. THAT, in substitution for any previous authority, the Directors be and are hereby generally and unconditionally
authorised, in accordance with Section 80 of the Companies Act 1985 (the ‘Act’), to allot relevant securities 
(as deﬁned in that Section) up to a maximum aggregate nominal amount of relevant securities of £755,744 
to expire on the earlier of the conclusion of the next Annual General Meeting of the Company and the date
ﬁfteen months after the passing of this resolution, but the Company may, before this authority expires, make
an offer or agreement which would or might require relevant securities to be allotted after this authority
expires and the Company may allot relevant securities pursuant to any such offer or agreement as if the 
power conferred hereby had not expired.
9. THAT, subject to Resolution 8 above being passed, the Directors be and are hereby generally empowered
pursuant to Section 95 of the Act to allot equity securities (within the meaning of Section 94(2) of the Act) of
the Company for cash pursuant to the authority conferred by that resolution and/or sell equity securities held
as treasury shares for cash pursuant to Section 162D of the Act, in each case as if Section 89(1) did not apply
to such allotment provided that this power shall be limited:
(a) to any such allotment and/or sale of equity securities where such securities have been offered (whether 
by way of a rights issue, open offer or otherwise) to holders of Ordinary shares of 10 pence each in the
capital of the Company (‘Ordinary shares’), (other than the Company) and, if in accordance with their
rights as the Directors so determine, to holders of other equity securities of any class (other than the
Company), in proportion (as nearly as may be) to their existing holdings of Ordinary shares or (as the case
may be) other equity securities of the class concerned (so that any offer to such holders of other equity
securities of any class shall be on the basis of their rights to receive such offer and, failing which, shall be
on the basis that their holdings had been converted into or that they had subscribed for Ordinary shares
on the basis then applicable) but subject to the Directors having a right to make such exclusions or other
arrangements in connection with such offering as they deem necessary or expedient:
(i) to sell, for the beneﬁt of those shareholders who are citizens in any overseas territory where in 
the opinion of the Directors, it would, at the time of the offer, be illegal (by relevant law) or unduly
costly or burdensome for the Company to make or for those shareholders to accept an offer of equity
securities of the Company, the equity securities to which they would otherwise be entitled, save that 
the proceeds (net of expenses) of £3 or less due to any such shareholders may be retained for the
beneﬁt of the Company; and   67 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
(ii) to aggregate and sell for the beneﬁt of the Company, all fractions of a share which may arise in
apportioning the equity securities among the original shareholders.
(b) to allotments of equity securities pursuant to the Company’s share option schemes; and
(c) to any allotment and/or sale (otherwise than pursuant to sub-paragraphs (i) or (ii) above) of equity
securities having in the case of relevant shares (as deﬁned in Section 94 of the Act) a nominal amount 
or, in the case of equity securities, giving the right to subscribe for or convert into relevant shares having 
a nominal amount not exceeding in aggregate £142,212 (representing ﬁve per cent of the Company’s
issued share capital);
and this power shall expire on the earlier of the conclusion of the next Annual General Meeting of the
Company and the date ﬁfteen months after the passing of this resolution save that the Company may 
before such expiry make an offer or agreement which would or might require equity securities to be allotted
or equity securities held as treasury shares to be sold after such expiry and the Directors may allot equity
securities and/or sell equity securities held as treasury shares pursuant to any such offer or agreement 
as if the power conferred hereby had not expired.
10. THAT the Company is hereby authorised to make market purchases (within the meaning of Section 163(3) of
the Act) of Ordinary shares provided that:
(a) the maximum number of Ordinary shares authorised to be acquired is 2,844,256 (representing ten per cent
of the Company’s issued shares);
(b) the minimum price which may be paid for each Ordinary share is 10 pence; and
(c) the maximum price (exclusive of expenses) which may be paid for each Ordinary share is an amount equal
to 105 per cent of the average of the middle market quotations for an Ordinary share taken from the Daily
Ofﬁcial List of the London Stock Exchange plc for the ﬁve business days immediately preceding the date 
of purchase.
This authority will (unless renewed) expire at the conclusion of the next Annual General Meeting of the
Company held after the date on which this resolution is passed or, if earlier, twelve months from the date of
passing this resolution.
The Company may make a contract of purchase of Ordinary shares under this authority before this authority
expires which will or may be executed wholly or partly after the expiry of the authority, and may make a
purchase of Ordinary shares in pursuance of any such contract.
11. THAT the granting of the Share Awards, the principal terms of which are summarised in the explanatory 
notes to the Notice of Annual General Meeting, dated 30 August 2006, in the form (or substantially in the
form) of the draft agreements produced to the meeting and initialled by the Chairman hereof for the purposes
of identiﬁcation, be and are hereby approved and that the Remuneration Committee (‘the Committee’) of
Universal Salvage plc be and is hereby authorised to do all acts and things necessary or expedient to carry 
the same into effect.
By Order of the Board 
REGISTERED OFFICE
Acrey Fields
Anne E Lister Woburn Road
Company Secretary Wootton
30 August 2006 Bedfordshire MK43 9EJ 68 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notice of Annual General Meeting
CONTINUED
NOTES
1. Only members whose names appear in the register of members of the Company not less than 48 hours before the time appointed for the meeting shall be
entitled to attend or vote at the Annual General Meeting or any adjournment thereof.
2. Any member of the Company who is entitled to vote at the above-mentioned Annual General Meeting may appoint another person or persons (whether a
member or not) as their proxy and, on a poll, to vote on their behalf.
3. CREST members who wish to appoint a proxy or proxies by utilising the CREST electronic proxy appointment service may do so for the Annual General Meeting
to be held on 27 September 2006 and any adjournment(s) thereof by utilising the procedures described in the CREST manual. 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 sponsor or voting
service provider(s) who will be able to take the appropriate action on their behalf. In order for a proxy appointment made by means of CREST to be valid, the
appropriate CREST message (a ‘CREST Proxy Instruction’) must be properly authenticated in accordance with CRESTCo’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 Issuer’s Agent ID:
RA10 by the latest time(s) for receipt of proxy appointments speciﬁed in the Notice of Meeting. For this purpose, the time of receipt will be taken to be the
time (as determined by the timestamp applied to the message by the CREST Applications Host) from which the Issuer’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 providers, should note that CRESTCo 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/her 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 providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST systems and timings.
The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertiﬁcated Securities Regulations 2001.
In the case of an instrument in writing to be valid, the proxy forms must be lodged with the Company’s Registrars, Capita Registrars (Proxies), PO Box 25,
Beckenham, Kent BR3 4BR not less than 48 hours before the time appointed for the meeting. Completing and returning a form of proxy will not prevent any
member from attending the meeting in person and voting should they so wish. A form of proxy is enclosed with this notice.
4. In the case of a corporation, the proxy form should be executed under its common seal or signed by a duly authorised ofﬁcer or attorney of the corporation.
5. The following documents will be available for inspection at the registered ofﬁce of the Company on any weekday (except Saturdays, Sundays and Public
Holidays) during normal business hours from the date of this notice until the date of the Annual General Meeting and at the place of the meeting for a 
period of ﬁfteen minutes before and during the meeting:
(a) the register of interests of the Company’s Directors in the shares of the Company which is maintained under Section 325 of the Act;
(b) a copy of all Directors’ service agreements; and
(c) draft agreements pursuant to which the Share Awards will be made.
EXPLANATORY NOTES
RESOLUTION 1: REPORT AND ACCOUNTS
The Directors must present to the shareholders at the Annual General Meeting the Directors’ Report and Accounts and the Auditors’ Report for the 52 weeks 
to 29 April 2006.
RESOLUTION 2: REPORT ON DIRECTORS’ REMUNERATION
The Directors must present to the shareholders at the Annual General Meeting the Report on Directors’ Remuneration for the 52 weeks to 29 April 2006.
RESOLUTIONS 3 TO 6: REAPPOINTMENT OF DIRECTORS
Article 109 of the Company’s Articles of Association states that the Board may appoint a Director, who must be reappointed at the next Annual General 
Meeting. Mr N C Stead and Mr R B Mead have been appointed by the Board and Resolutions 3 and 4 propose their reappointment.
Article 105 of the Company’s Articles of Association states that one-third of the Directors will retire at each Annual General Meeting. Mr A N Foster and 
Mr A F Somerville retire by rotation and Resolutions 5 and 6 propose their reappointment. The Directors recommend the re-election of Mr A N Foster as 
Chairman and the Chairman recommends the re-election of Mr A F Somerville as Group Finance Director.
Biographical details of the Directors and particulars of their service agreements with the Company are set out on pages 2, 3 and 22 of the Annual Report 
and Accounts for the 52 weeks to 29 April 2006.
RESOLUTION 7: REAPPOINTMENT OF AUDITORS
At each Annual General Meeting, the Company is required to appoint auditors to serve until such next meeting. PricewaterhouseCoopers LLP have said 
that they are willing to continue in ofﬁce for a further year. Resolution 7 proposes their reappointment and that, in accordance with normal practice, the 
Directors should be authorised to agree their fees. 69 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
EXPLANATORY NOTES CONTINUED
RESOLUTIONS 8 AND 9: RENEWAL OF AUTHORITY TO ALLOT SHARES
The authority given to the Directors at the last Annual General Meeting to allot unissued share capital expires and to allot shares for cash without applying
statutory pre-emption rights expires on the date of the forthcoming Annual General Meeting, 27 September 2006. It is proposed that both of these authorities be
renewed. Accordingly, an Ordinary Resolution (Resolution 8) will be proposed to authorise the Directors to allot unissued share capital up to an aggregate nominal
amount of £755,744 being 7,557,442 Ordinary shares, representing approximately one third of the share capital currently in issue in accordance with institutional
investor guidelines. A Special Resolution (Resolution 9) will be proposed authorising the Directors to allot shares in connection with a pre-emptive issue to existing
shareholders or for cash up to £142,212 (being approximately ﬁve per cent of the present issued Ordinary share capital). Both these authorities will expire on the
earlier of ﬁfteen months after passing this resolution and the conclusion of the next Annual General Meeting of the Company. The Directors have no present
intention to issue shares, except as needed to satisfy the exercise of options under the Company’s existing share option arrangements.
RESOLUTION 10: AUTHORITY TO PURCHASE OWN SHARES
The authority given to the Company at the last Annual General Meeting to purchase its own shares expires on the date of the forthcoming Annual General Meeting,
27 September 2006. It is proposed to renew this authority. The Special Resolution proposed as Resolution 10 will authorise the Directors to buy the Company’s
shares subject to the constraints set out in the resolution. The Directors would exercise this power only if satisﬁed that it was in the interests of the shareholders as
a whole to do so and that it was likely to result in an increase in earnings per share (‘EPS’). Any shares purchased in accordance with this authority will subsequently
be cancelled.
RESOLUTION 11: SHARE AWARDS
The Board is seeking shareholders’ approval at the Annual General Meeting to make the following one-off share awards (‘the Awards’) to the Company’s Executive
Directors (‘the Executives’):
150,000 shares to Mrs A Palmer-Baunack
100,000 shares to Mr A F Somerville
Using the middle market price of the Ordinary shares of the Company on Friday 21 July 2006, being 113.0 pence as an indicative price, the value of the shares 
to be awarded represents 106% and 87% of current annual basic salary respectively.
The Company is currently at a stage in the achievement of its Business Turnaround Plan that should see a signiﬁcant enhancement in shareholder value if the
Business Turnaround Plan is successfully achieved. After careful consideration, the Committee is therefore proposing to make the Awards to incentivise these
individuals to produce performance that supports the achievement of the Business Turnaround Plan and ensure that, over the long-term, the interests of these
individuals will be even more closely aligned with shareholders’ interests.
Other than the Awards, the Committee’s intention is that these individuals will not receive Awards under any other discretionary share plan in the next twelve
months.
The Committee has determined that one-sixth of each of the Awards shall vest immediately to reﬂect the Executives’ contribution to date in delivering the 
Business Turnaround Plan.
In accordance with guidelines on executive share schemes published by the Association of British Insurers (‘the ABI’) and best practice, challenging performance
targets will be attached to the Awards to the extent that these vest based on future performance. Therefore, the remaining ﬁve-sixths of each of the Awards will
vest based on satisfaction of targets for each ﬁnancial year ending 28 April 2007, 3 May 2008 and 2 May 2009 to encourage sustained improvement in ﬁnancial
performance.
The underlying shares will be transferred to the Executives or, where an Award is structured as an option, will be able to be exercised on vesting.
Further details of the terms of the Awards are given in the Note to Resolution 11 on pages 70 and 71.
The source of shares for the satisfaction of these Awards will be shares currently held by the Trustees of The Universal Salvage plc 2000 Employees’ Share Trust.
On vesting of the Awards, therefore, there will be no dilution in respect of existing shareholdings.
Draft agreements pursuant to which the Awards will be made will be available for inspection at the registered ofﬁce of the Company and at the ofﬁces of
PricewaterhouseCoopers LLP, 1 Embankment Place, London WC2N 6RH on any weekday (except Saturdays, Sundays and Public Holidays) during normal business
hours from the date of this notice until the Annual General Meeting and at the place of the meeting for a period of ﬁfteen minutes before and during the meeting.
The Board believes these proposals to be in the best interests of the shareholders as a whole and recommends that shareholders vote in favour of the resolution as
they intend to do so in respect of their personal shareholdings which, in aggregate, amount to 201,500 shares as at the date of this document. 70 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Notice of Annual General Meeting
CONTINUED
NOTE TO RESOLUTION 11
SUMMARY OF THE TERMS OF SHARE AWARDS (‘THE AWARDS’)
A summary of the principal terms of each of the Awards is set out below.
AWARDS
1. The Awards will be structured as share awards whereby shares are transferred to the Award holder on satisfaction of the applicable performance targets or as 
nil-cost options whereby the Award holder may give notice of exercise and acquire shares on satisfaction of the applicable performance targets.
2. The Awards will be granted as soon as practicable after, and in any event within 42 days of, the Annual General Meeting. If it is not possible to grant the Awards
within this period, the Awards will be granted within 42 days of the date on which such grant becomes possible.
3. The Awards are personal to the Award holder and (except on the death of an Award holder) may not be transferred.
4. No payment will be required for the Ordinary shares which are subject to an Award.
5. The Awards will not be pensionable for the purposes of calculating the employer’s pension contributions to any pension arrangements.
VESTING OF AWARDS
6. One-sixth of each of the Awards will vest at the date of grant of the Awards.
One-third of each of the Awards will vest based on the performance for the ﬁnancial year ending 28 April 2007.
One-third of each of the Awards will vest based on the performance for the ﬁnancial year ending 3 May 2008.
The remaining one-sixth of each of the Awards will vest based on the performance for the ﬁnancial year ending 2 May 2009.
In normal circumstances, the proportion of the Awards relating to each ﬁnancial year will vest at the time of announcement of the results for the applicable
ﬁnancial year provided that the Committee has determined that the performance target for the relevant ﬁnancial year has been satisﬁed and provided that 
the participant remains employed within the Universal Salvage plc group (‘the Group’) at that time.
PERFORMANCE TARGETS
7. Vesting of the Awards relating to the ﬁnancial years ending 28 April 2007, 3 May 2008 and 2 May 2009 will be achieved in full only if the following EPS
performance targets are met:
Year ending 28 April 2007 – 2.5 pence
Year ending 3 May 2008 – 5.0 pence
Year ending 2 May 2009 – 9.0 pence 
50% of the proportion of the Awards relating to the relevant ﬁnancial year will vest for achievement of the following EPS performance targets:
Year ending 28 April 2007 – 2.25 pence
Year ending 3 May 2008 – 4.5 pence
Year ending 2 May 2009 – 8.1 pence 
Where EPS is between the levels set out above, the proportion of the Awards that vest will increase on a straight-line basis between 50% and 100%.
For the purpose of the Awards, EPS is to be determined on a fully diluted basis based on proﬁt before tax and before exceptional items as reported in the
Company’s ﬁnancial statements. The EPS ﬁgures shown above are not intended to represent a proﬁt forecast for the Company.
To the extent that the performance target is not satisﬁed, the relevant proportion of an Award will lapse.
8. If an event occurs which causes the Committee to consider that the performance target is no longer appropriate, the Committee may substitute, vary or waive
the performance target as is reasonable in the circumstances and to produce a fairer measure of performance which is neither materially more or less difﬁcult
to satisfy. Any outstanding Awards shall then take effect subject to the performance target as so substituted, varied or waived.
TRANSFER OF SHARES
9. Shares will be released to the Award holder following vesting to the extent that, where applicable, the Committee has determined that the performance target
has been satisﬁed in respect of the relevant ﬁnancial year or in the case of an Award structured as an option, the option may be exercised to the extent vested
within the period of one year from the date on which the results for the relevant ﬁnancial year are announced. 71 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
NOTE TO RESOLUTION 11 CONTINUED
SUMMARY OF THE TERMS OF SHARE AWARDS (‘THE AWARDS’) CONTINUED
LEAVERS
10. If an Award holder ceases to be employed by reason of death, injury, ill health, disability, redundancy, retirement or because the Company or business for which
they work ceases to be part of the Group:
(i) the proportion of the Award relating to the ﬁnancial year in which employment ceases will vest on a pro rata basis to the extent that the performance
target for the relevant year is likely to be satisﬁed in the opinion of the Committee; and
(ii) the proportion of the Award relating to a ﬁnancial year not yet started will lapse.
11. If a participant’s employment with the Group ceases for any reason other than those set out in paragraph 10, their Award will lapse, save that the Committee
may in its absolute discretion permit vesting as set out in paragraph 10 within a stated period. The Committee expects to exercise this discretion only in
exceptional circumstances.
12. The pro rata testing following cessation of employment will take into account the proportion of the ﬁnancial year that has elapsed as at the date of cessation
of employment.
TAKEOVER
13. In the circumstances of a takeover, amalgamation, reconstruction or winding-up of the Company:
(i) the proportion of the Awards relating to the ﬁnancial year in which a takeover, amalgamation, reconstruction or winding-up of the Company occurs will
vest in full; and
(ii) the proportion of the Award relating to a ﬁnancial year not yet started will lapse.
The Committee may in addition declare that the Awards which would vest in accordance with (i) above will vest during a limited period prior to the relevant
event provided the Committee expects the relevant event to complete (typically in order to preserve the Company’s entitlement to corporation tax deductions
in respect of such events). Alternatively, where the Company is acquired by another company, participants may be given the opportunity to exchange their
vested Awards for new Awards over shares in the acquiring company within a speciﬁed period.
14. Ordinary shares transferred in satisfaction of the Awards following vesting will rank equally with existing Ordinary shares in accordance with the terms of the
Awards (save as regards any rights attaching to such shares by reference to a record date prior to the acquisition date).
DIVIDENDS
15. The Award holder shall not be entitled to dividends or dividend equivalents in respect of any shares until the relevant proportion of the Award has vested or,
in the case of an Award structured as an option, until the relevant proportion of the option has been exercised.
VARIATIONS OF SHARE CAPITAL
16. In the event of any increase, reduction or variation of the share capital of the Company, the Committee may make such adjustments as it considers appropriate
to the number of Ordinary shares subject to the Awards or the price payable for such shares.
AMENDMENT
17. The Committee may at any time amend the terms of the Awards. However, without the prior approval of the Company in general meeting, an amendment may
not be made to any of the terms of the Awards which is to the advantage of Award holders, save that the Committee may make (without shareholder approval)
an amendment which is minor in nature to beneﬁt the administration of the Awards or is necessary or desirable in order to take account of a change of
legislation or is made to obtain or maintain favourable tax, exchange control or regulatory treatment for Award holders or any member of the Group.
18. No amendment shall be made to the terms of the Awards which would adversely affect any of the subsisting rights of Award holders without their consent.
N.B.
This note summarises the main features of the Awards but does not form part of them and should not be taken as affecting the interpretation of their detailed
terms and conditions. The Committee reserves the right up to the time of the Annual General Meeting to make such amendments and additions to the proposed
terms of the Awards as it may consider necessary or desirable, provided that such amendments and additions do not conﬂict in any material respect with the
summaries of the Awards as set out in this note. 72 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006
Financial Calendar
Shareholder Information
Annual General Meeting 27 September 2006
Half year-end 28 October 2006
Interim results announced December 2006
SHAREHOLDER ENQUIRIES
Enquiries relating to the following matters should be addressed 
in writing to the Company’s Registrar, quoting your full name 
and address, your account number (if known) and the Company’s 
name: dividend payments; dividend mandate instructions; loss 
of share certiﬁcates/dividend cheques/tax vouchers; notiﬁcation 
of change of address; transfer of shares.
A quick and easy share dealing service is available from the 
Company’s Registrar to either sell or buy more shares. For further
information on this service, or to buy or sell shares, please contact:
•
www.capitadeal.com (on-line dealing)
•
0870 458 4577 (telephone dealing)
For other enquiries relating to shareholder services or general 
enquiries about the Company, please contact the Company 
Secretary’s department at the Company’s registered ofﬁce.
INTERNET 
Universal Salvage plc’s homepage on the Internet 
www.universal-services.co.uk contains details of its activities,
ﬁnancial information, share price information and press releases.
ANNUAL REPORT AND ACCOUNTS
If you would like a copy of the Universal Salvage plc Annual 
Report and Accounts or the Interim Report, please view on
www.universal-services.co.uk and click on Investor
Relations/Financial Reports.
STOCKBROKERS AND FINANCIAL ADVISERS
Panmure Gordon (UK) Limited
155 Moorgate, London EC2M 6XB 
BANKERS
The Royal Bank of Scotland plc
8th Floor, 280 Bishopsgate London EC2M 4RB
REGISTRARS
Capita Registrars, The Registry
34 Beckenham Road, Beckenham, Kent BR3 4TU
FINANCIAL PUBLIC RELATIONS
Biddick Associates Limited, Mercury House, Triton Court
14 -18 Finsbury Square, London EC2A 1BR
AUDITORS
PricewaterhouseCoopers LLP 
1 Embankment Place, London WC2N 6RH
SOLICITORS
CMS Cameron McKenna, Mitre House
160 Aldersgate Street, London EC1A 4DD
Shoosmiths, Lock House 
Castle Meadow Road, Nottingham NG2 1AG
REGISTERED OFFICE
Acrey Fields, Woburn Road
Wootton, Bedfordshire MK43 9EJ
COMPANY NUMBER
1464832 
Registered in England and Wales
Advisers Locations
•
Wootton, Bedfordshire
Head office
Workshop and storage centre
Trade centre
ELV processing
Dismantling and recycling parts sales
•
Denny, Stirlingshire
Storage and auction: car 
(Internet only)
•
Sandtoft, South Y orkshire
Storage and auction: car,
motor cycle, LCV
ELV processing
•
Chester, Flintshire
Storage and auction: car 
(Internet only)
ELV processing
•
Sandy, Bedfordshire
Storage and auction: car,
motor cycle, LCV
ELV processing
•
Westbury, Wiltshire
Storage and auction: car 
(Internet only)
ELV processing 
•
Sandwich, Kent
Storage and auction: car,
motor cycle, LCV
ELV processing
•
Corby, Northamptonshire
*
*site currently not operational
CHESTER
CORBY
SANDY
WOOTTON
WESTBURY
SANDWICH
SANDTOFT
DENNY
73 Universal Salvage plc ANNUAL REPORT AND ACCOUNTS 2006 Universal Salvage plc
Acrey Fields
Woburn Road
Wootton
Bedfordshire
MK43 9EJ
Tel: 0870 458 9210
Fax: 01234 762204
www.universal-services.co.uk