Plasmon Plc 
Annual Report 
2003
Plasmon Plc Annual Report 2003 Contents
01 Overview and Highlights
02 Chairman’ s Statement
06 Chief Executive’ s Review
14 Finance Director’ s Review
17 Board of Directors and Senior 
Management
18 Corporate governance
20 Remuneration report
23 Directors’ report
24 Auditors’ report
25 Consolidated profit and loss account
26 Statement of total recognised gains and losses
27 Consolidated balance sheet
28 Company balance sheet
29 Consolidated cash flow statement
30 Notes to the financial statements
Directors and advisers Plasmon Plc 
Annual Report 2003
Introduction
1
2003 Highlights
T urnover declined 2% to £60. 1m 
(2002: £61 .6m)
Pre-tax profit before goodwill amortisation,
UDO development costs and exceptional
costs increased 29% to £4.7m (2002:
£3.7m). Pre-tax loss £3.4m (2002: £6.3m)
Basic losses per share reduced to 6.41p
(2002: 12.28p)
Earnings per share excluding goodwill
amortisation, UDO development costs and
exceptional costs flat at 8.86p (2002: 8.96p)
The 2nd half retained loss fell to £1 .0m 
(1st half: £2.4m) as post reorganisation cost
savings were realised
Excellent OEM response to successful
demonstration of functional UDO drives at
Comdex in November 2002. Programme on
schedule for initial product shipments in
September 2003
UDO development expenditure £6.5m
(2002: £5.2m) – raised £1 .7m net in June
2002 to support purchase of UDO
manufacturing equipment
Y ear end gearing 34% (31 March 2002: 24%)
Plasmon Overview
Plasmon manufactures automated data
storage systems for the professional data
storage market. Plasmon’ s systems are
predominantly based on optical storage
technology and are used for large-scale
data archive applications.T ypical end users
include banks, insurance companies,
hospitals and government agencies. 
Plasmon operates on a global basis and
over 60% of revenues are derived in the
USA and less than 5% in the UK home
market. Manufacturing is located in
Colorado Springs in the USA, Caen in
Northern France and Cambridge, which 
is also the Group’ s UK headquarters.
Plasmon employs over 400 people
worldwide and has been Listed on the
London Stock Exchange since 1996. Plasmon Plc
Annual Report 2003
Chairman’s Statement
2
Following the upheaval of our
major US reorganisation last year ,
2002/3 has been a period of
consolidation and steady progress
for the Plasmon Group. Despite
poor economic conditions in the
US and uncertainty created by the
war in Iraq, our full year revenues
fell by only 2% to £60. 1m compared
to £61 .6m the previous year . 
J. Barrie Morgans
Chairman
Chairman’s Statement Plasmon Plc 
Annual Report 2003
Chairman’s Statement
3
Pre-tax profit before goodwill amortisation,
UDO development costs and exceptional
costs increased 29% to £4.7m and the
retained loss for the full year reduced 41%
to £3.4m. Having incurred a loss of £2.4m
in the first half, the retained loss in the
second half fell to £1 .0m as post
reorganisation cost savings were realised.
Despite the poor trading conditions our
channel sales in the US increased by 4%
in dollar terms. As expected, sales to IBM
decreased a further 35% in 2002/3
resulting in an overall US revenue decline
of 3% in local currency terms, translating
into a fall of 10% after unfavourable foreign
exchange movements. Our US business
represented 66% of Group sales in 2002/3
and the level of activity in the US market
therefore remains a critical driver of our
overall business performance.
Having achieved 6% revenue growth last
year , our European channel sales grew a
further 15% in 2002/3 as we continue to
increase market share in our core 5.25"
library business. In August we secured
Siemens as a major new DVD library
customer and we expect this relationship
to drive further growth in the coming year .
European economic conditions were 
more favourable than the US last year 
and we also benefited from a stronger
European regional presence than many 
of our US competitors.
Our UDO development programme
continues to make excellent progress and
we successfully demonstrated working
UDO drives at the Comdex trade show in
Las Vegas in November . The overall cost of
the UDO development programme
remains broadly in line with our plans and
we are on schedule to begin initial
shipments in September this year . 
We are receiving an excellent response from
potential OEM customers and expect UDO
technology to establish a leading position in
professional optical storage solutions.
Recent changes in financial compliance
regulations are also driving the market
requirements for secure data archival
solutions like UDO and we look forward to
commencing deliveries of this exciting new
product in the coming financial year .
In June 2002 we raised a further £1.7m net
of expenses, by way of a 5% Placing, to
support the purchase of capital equipment
for UDO at a time when equipment leasing
was proving difficult to secure. In February
2003 we further improved our available
financial resources with a £7m structured
finance facility that provides us with ample
liquidity to complete our UDO
development and launch plans. Our
financial position remains comfortable with
gearing of 34% at year end.
Although trading in the past year was
difficult, we start the new financial year
well positioned to complete the UDO
development and capitalise on its
significant potential. Our UDO launch
plans are well advanced and we believe
the timing is excellent to deliver a
performance leading data archival solution
at a time of growing compliance
regulation. After a period of significant
contraction the IT market is also forecast
to return to modest growth, which we
expect to drive increased revenue and
profitability in our core business in the
coming year .
On behalf of the Board, I would like to thank
all our employees for their dedication and
hard work over the past year .
J. Barrie Morgans
Chairman Plasmon Plc
Annual Report 2003 4
The UDO production line employs
the latest high capacity optical disk
manufacturing equipment and will
have an output of some 80,000
disk’s per month when operating 
at maximum capacity Plasmon Plc 
Annual Report 2003 5 Plasmon Plc
Annual Report 2003
Chief Executive’s Review
6
2002/3 has been another challenging
year for Plasmon with difficult economic
conditions and the continuing decline 
in our business with IBM depressing
overall revenues from £61 .6m to £60. 1 m.
In contrast to the disappointing trading
performance, our UDO development
programme made excellent progress in
2002/3 and we completed successfully
the transfer of our library business from
Minneapolis to Colorado Springs.
Chief Executive’s Review
Nigel Street
Chief Executive Plasmon Plc 
Annual Report 2003
Chief Executive’s Review
7
1 999 2000 2002
49.9
70.3
69.1
70
60
50
40
30
20
10
0
61.6
2003
60.1
0.3
4.1 4.2
6.3
3.4
(Loss)/profit before tax £ million
4
2
0
-2
-4
-6
-8
-10
2001
1 999 2000 2002 2003 2001
T urnover £ million In the first half of 2002/3, the Group
returned to modest growth with revenues
3% ahead at £30.1m. As we experienced
last year , our European operations
performed better than our business in the
US where economic conditions remained
difficult. In the final quarter of 2002/3 our
US business was further impacted by
events in the Middle East, and coupled
with a 10% movement in the average £:$
exchange rate our overall second half
revenues declined 7% from the previous
year . Since the cessation of hostilities we
are seeing increasing signs of activity in
the US, but we remain cautious about the
timing of any upturn in business. In
contrast, our European business grew
17% in 2002/3 and we expect to make
further progress in the coming year .
In light of the difficult trading conditions
our US reorganisation has proved both
timely and extremely necessary. The
reorganisation was finally completed in
September 2002 when the last library
engineers left our Minneapolis engineering
operation. These engineers were retained
for six months longer than the
manufacturing group to complete the new
Enterprise DVD library range that we
developed specifically for our major
medical imaging customers such as
Siemens Medical. From a peak of some
314 US employees in 2001, the US
reorganisation programme reduced the
headcount to 225 by April 2003. In
addition, we reduced our European
headcount by some 20 employees as part
of our overall cost control programme.
In 2002/3 our overall product mix remained
broadly constant and, in line with the sales
shortfall, our gross margins declined
slightly to 36.3% from 36.7% the previous
year . Following our reorganisation,
operating expenses before UDO
development expenditure, goodwill
amortisation and exceptional costs fell by
£2.0m to £16.4m. At the adjusted pre-tax
level we achieved a profit of £4.7m
compared to the £3.7m we achieved the
previous year . At the pre-tax level we
significantly reduced our full year loss to
£3.4m from £6.3m, after goodwill
amortisation of £1.1m and the final £0.5m
of US reorganisation costs.
UDO development expenditure increased
by 24% to £6.5m in 2002/3 as we entered
the final development phase of the drive
and media. The increased expenditure
was slightly ahead of our original
expectations and reflected additional
costs in reworking ASIC parts and the
consequent increase in quick-turn
prototype costs to keep the project on
schedule. In addition to fully expensed
development costs of £6.5m, we invested
a further £3.9m in capital equipment in
2002/3 as the UDO media production
facility in Melbourn neared completion.
Despite maintaining significant levels of
investment in 2002/3, our year-end gearing
remained comfortable at 34% compared
to 24% the previous year .
In March 2003 we secured new £7m
banking facilities with Venture Finance Plc,
the UK structured finance subsidiary of
ABN Amro. These new financing
arrangements have increased our
immediate liquidity by some £3.4m and
will provide sufficient funding to
complete UDO development and enter
volume production. Plasmon Plc
Annual Report 2003
Chief Executive’s Review
8
UDO Development
Ultra Density Optical (‘UDO’) is the next
generation of 5.25" drives and media that we
are developing to succeed the existing
9.1GB MO products we source from Sony .
UDO employs the latest blue laser
technology that provides an increased 30GB
capacity and a five-fold decrease in
incremental storage cost over existing MO
systems. Since commencing development
in 1999 we have worked closely with HP on
the project and expect them to become the
major OEM customer for UDO technology .
Since the successful demonstration of
working drives at Comdex last November ,
we have continued to make good progress
with our UDO development programme and
are now reading and writing data reliably in
form-factor drives. The final phases of the
development are now underway and involve
manufacturing increasingly large batches of
prototype drives and media to de-bug the
system fully and maximise performance
and reliability.
The UDO drive employs four ASIC chips that
have been specifically designed by Plasmon
and our development partners. Successful
development of these ASICs represented
one of the major risks in the UDO
programme but three of them are now
complete and fully tested. The final Optical
Disc Controller (ODC) chip has exhibited
some speed limitations during testing but a
revised design has now been released to
fabrication which should solve the
outstanding issues. Our total capital
investment in the ASICs will be some £3m
but they are critical to achieving the low
volume production costs that will allow UDO
to compete effectively in the market. 
Another area of significant risk in the UDO
programme was the availability of blue lasers
UDO optical media will be
manufactured in Cambridge and
will be available in both write-once
and rewritable formats  Plasmon Plc 
Annual Report 2003
Chief Executive’s Review
9
from Nichia, our Japanese supplier . In
December 2002 Nichia announced a new
agreement to collaborate with Sony on blue
laser development for use in Sony’ s ‘Blu-ray’
consumer video products. Nichia also
informed Plasmon that due to yield problems
with their existing laser , they were moving to
a revised laser design employing elements of
Sony technology . W e have now successfully
integrated the new lasers into our UDO
drives and we are confident that their
performance and reliability will comfortably
exceed our requirements.
The opto-mechanical assembly (‘OMA ’) for
the UDO drive is being developed by Pentax,
the leading Japanese optical technology
company . The hard tooling for the OMA is
now complete and we are currently
integrating production quality units into our
prototype drives. Our working relationship
with Pentax continues to be excellent and we
have recently despatched one of our
Japanese speaking engineers to Japan for
18 months to help transition the OMA to a
low cost volume production facility .
UDO media development is also making
good progress and we now have the majority
of the disk manufacturing equipment
installed at our facility in Melbourn. The new
cleanroom is fully commissioned and when
complete the production line will have a total
capacity of some 80,000 write-once and
rewritable UDO disks per month.
Development of the phase change recording
layers for UDO media is proceeding well and
the specification of the write-once disk is
now finalised for volume production. This will
employ a four layer structure based on phase
change technology licenced from Kodak that
we also use on our existing 12-inch optical
disk products. W e are therefore very familiar
with the manufacturing process for this
material and are confident a high yield
process will be achieved.
The rewritable phase change disk is in its final
testing phase and will employ an eight layer
structure to optimise rewrite cycle
performance, environmental longevity and
manufacturability . In January 2003 we signed
a licence agreement with Mitsubishi
Chemical Media (‘MCM’) for their patents
and technologies for improving rewrite cycle
and cross erase performance in phase
change rewritable media. Using MCM’ s
technology we have already exceeded the
UDO specification of 10,000 rewrite cycles
and with further optimisation, believe that
25,000 cycles may be achievable.
MCM are the world’ s largest optical disk
manufacturer and as well as first class
technical know-how , they have an excellent
quality reputation with the major OEM
customers such as HP and IBM. W e
continue to work closely with HP on their
UDO plans and as they move towards UDO
endorsement they are pressing MCM to be
the second source media manufacturer .
Major partners such as HP and MCM will be
critical in establishing UDO as the de-facto
standard in professional optical storage and
we continue to use every effort to secure
their endorsement of UDO.
Having established the UDO media
production facility and commenced trial
production runs, we are now working on
improvements to the 0.1mm cover layer
process to reduce volume production costs.
W e have recently approved a European
supplier of optical grade 0.1mm film that has
reduced our material costs by some 75%
over Far East suppliers. In addition, we are
also working on a new liquid spin coating
technique that is now providing excellent
uniformity and will dramatically reduce future
production costs.
The media cartridge is an important
component in the overall robustness and
reliability of UDO technology and has been
an area of intense focus over the last year .
W e have recently taken delivery of initial
samples from the final production tooling and
are now working with Dai-Nippon, our
Japanese supplier , to move volume
production to China to minimise long term
cartridge manufacturing costs.
Overall, the UDO development programme
is progressing well and we are on schedule
to make initial product deliveries in
September 2003. As expected, UDO’ s
common technology base with consumer
Blu-ray products continues to provide
technology leverage opportunities and will
ensure our long-term manufacturing costs
remain competitive.
5.25" 42%
12" 33%
CD/DVD 11%
Consultancy 7%
L TO tape 2%
Other 5%
Plasmon product mix 2003
5.25" 43%
12" 38%
CD/DVD 5%
Consultancy 6%
L TO tape 2%
Other 6%
Plasmon product mix 2002 Plasmon Plc
Annual Report 2003
Chief Executive’s Review
10
UDO launch plans
In addition to the drive and media
development programme, during the past
year we have invested considerable time
and resources on our UDO launch plans.
We successfully recruited new marketing
leadership in both the US and Europe and
are now adding business development
resources specifically focused on UDO to
our sales and marketing teams.
The launch programme for UDO initially
focused on trade shows and started with
the first demonstration of working UDO
drives at Comdex in November 2002. We
also demonstrated the products at the
AIIM show in New Y ork and Cebit in
Hanover , which is the largest IT trade show
in Europe. In addition to the product
demonstrations, we also presented a
series of seminars that explained UDO
technology and its positioning in the
overall storage market. We received a
considerable level of interest from these
initial activities and UDO is now well
known in the storage industry.
We are now commencing the second
phase of our launch activities with a
technical conference for third party
software vendors to enable them to
understand the technology and integrate it
into their software applications. We are
also planning a series of press and media
tours later in the year to generate general
awareness of UDO and increase its
exposure as we move into initial
production shipments.
The final element of our UDO launch plan
has focused on potential OEM customers
and our efforts to educate them and
support their integration activities. The
overall response to UDO has been
excellent and we believe the superior cost-
UDO drives will be manufactured 
in our Colorado Springs facility and
will have an initial capacity of
30GB. Future generations of UDO
products will have capacities of 60
and 120GB Plasmon Plc 
Annual Report 2003
Chief Executive’s Review
11
performance benefits of the technology
should attract significant OEM
endorsement over the coming months. 
Storage market overview
The storage market continues to be a
significant portion of the overall IT market
and the revenue declines of the last few
years stabilised in 2002/3. Storage
technology is now entering a period of
significant change that will provide a
number of opportunities and challenges
for Plasmon in the near future.
The drive towards networked storage
continues to gather momentum with the
goal of eradicating ‘islands of information’
and making all data available across the
enterprise. Networked storage is therefore
driving the requirements for storage area
networks (‘SAN’) and network attached
storage (‘NAS’) solutions and the
consequent need for Plasmon’s optical
library solutions to integrate seamlessly
into these environments.
Another important development in the
storage market last year was the arrival of
cheap, high performance Serial-A T A hard
disk drives. Due to their low cost, these
products are now being promoted in 
disk-to-disk back-up solutions that are
challenging the traditional market for 
back-up using tape libraries. In addition, the
low-end tape library market largely moved
to a commodity model last year with the
large PC brands beginning to promote
products directly to the end user , bypassing
traditional storage hardware channels.
From Plasmon’s perspective, the most
important development in the storage
market has been the recognition of the
importance of secure archival storage
following the high profile corporate and
securities fraud cases in the US last year .
There are now growing compliance
regulations in most industry sectors to
mandate how electronic records must be
archived. These regulations are driving
strong interest in data archival products
such as UDO. These developments have
also attracted the attention of traditional
hard disk vendors such as EMC and
Network Appliance, who are offering
Serial-A T A disk based solutions with
enhanced software to prevent data
deletion as an alternative to traditional
write-once optical archive solutions.
These changes and developments in the
storage market are generally very
beneficial for Plasmon as we launch our
UDO archive solutions in the coming year .
However , the downside is in our tape
business where we expect revenue growth
to remain difficult in a market under severe
margin pressure. In addition, the trend
towards networked storage solutions will
require updating of Plasmon’s NAS
connectivity offerings to improve the ease
of deployment of our UDO products.
5.25" T echnology
Over the past few years, our sales of 5.25"
optical libraries to IBM have declined by
some 60% as they continue to sell last
generation 5.2GB write-once solutions
and have not adopted the latest 9.1GB
technology. In December 2002 we signed
a new contract with IBM to provide native
support for Plasmon libraries on their
iSeries (AS400) server platforms. In the
future, this new agreement will enable
Plasmon to sell UDO libraries directly to
the IBM customer base to replace sales of
the previous generation products we
currently supply to IBM on an OEM basis.
Plasmon brand channel sales of 5.25"
products continued to grow last year but
failed to make up the IBM shortfall. Overall
sales of 5.25" technology declined some
6% to £24.9m as cheaper DVD solutions
increased their market penetration but we
also increased our market share in 5.25"
libraries at the expense of Hewlett
Packard. Our strengthening position 
will serve as an ideal launch point for 
UDO solutions in 2003 when we expect
the increased capacity and fivefold
decrease in incremental cost of UDO 
will drive renewed growth in our core 
5.25" business.
During the past year we continued to migrate
customers to our new G-Series range of
5.25" libraries and away from the older 
M-Series products. We now plan to end of
life the M-Series at the end of 2003 which
is also planned to be the last shipment date
for the IBM 3995 variant of the product.
In late 2002 our automation engineering
team in Colorado Springs commenced
development of a new range of entry level
G-Series libraries. These products will
have capacities from 24 to 180 cartridges
and provide market leading features at a
lower cost than our existing products. 
First shipments are scheduled to coincide
with initial UDO shipments in September
2003 and we are already seeing strong
OEM interest in the cost/performance
attributes of the new range. The new
products have also been designed to
accommodate our next generation NAS
hardware internally to provide integrated
network storage solutions.
The market for 5.25" products has been 
in slow decline in recent years as lower
cost DVD solutions have emerged.
However , UDO will redress this cost
disadvantage and we expect some major
OEM’s to endorse the technology in 2003,
which will lead to renewed growth for 
5.25" products and the establishment of
UDO as the de-facto professional optical
storage standard. Plasmon Plc
Annual Report 2003
Chief Executive’s Review
12
12" T echnology
The 12" business continues to be a major
part of Plasmon’s total revenue mix but
overall sales declined some 17% to
£19.6m. The majority of the reduction
was in sales of new drives that declined
58% to £1.4m as 12" solutions become
prohibitively expensive and customers
wait for UDO technology. Sales of 12"
media and service declined a more
modest 12% in total to £7.5m and
£10.1m, respectively.
The change in our 12" business was in line
with our expectations and the rate of
decline should slow as new drive sales
cease and the business becomes a media
and service annuity. The 12" customer
base is firmly wedded to write-once optical
storage solutions and is showing strong
interest in the significant cost advantages
of UDO technology. We are now working
on upgrade and conversion programmes
to migrate these customers to UDO but
still expect to enjoy significant revenues
from 12" media and service for several
more years.
CD/DVD
In response to demand from our major
medical imaging customers such as
Siemens Medical and GE Medical, we
introduced the Enterprise D-Series library
last year with a capacity of up to 2,175
discs. The library is derived from our G-
Series 5.25" platform and its development
was completed ahead of schedule in late
2002 by the outgoing Minneapolis
engineering team. 
The response to the Enterprise D has been
excellent and helped CD/DVD sales grow
139% to £6.5m last year . In mid-year we
secured Siemens Medical as a major new
customer for this product and the medical
imaging market in general is adopting DVD
technology because of its low cost. The low
performance of DVD solutions also
matches the infrequent access
requirements of the medical imaging
market, but the reduced reliability and ease
of use of DVD remains a major concern.
However , we expect UDO to regain market
share in this area as it offers higher
performance and reliability at the same
price point as DVD based solutions.
Consultancy
Our optical media consultancy business
had another excellent year in 2002/3 with
revenue growth of 9% to £3.9m compared
to £3.6m the previous year . During the year
we signed significant new agreements
with Intel Research to develop high-
density phase change storage technology
and with Unaxis AG, to develop 0.1mm
cover layer technology for volume Blu-ray
disc production.
Our CD-R and DVD-R consultancy
business with Ciba Specialty Chemicals
also performed well in 2002/3 and we
estimate the Plasmon-Ciba Ultragreen CD-
R dye has a 65% share of the world-wide
market for CD-R dyes. After a considerable
delay due to technical issues, Ciba will
finally launch a new DVD-R dye in mid 2003
and we expect this to drive significant future
royalty growth as recording video to DVD’ s
becomes a mainstream application.
L TO T ape
Our L TO tape library business was a major
disappointment in 2002/3 with revenues flat
at £1.4m. Although we successfully
completed our product range with the
Exabyte autoloader acquisition and
secured the necessary software support,
the market has since commodotised with
the entry of major PC brands such as Dell
with very aggressive pricing. In light of these
changes, we are reviewing our overall tape
strategy to position our products as part of
higher value added solutions and
consequently expect to achieve only
modest growth for this part of our business.
Software and Connectivity
Sales of our connectivity solutions, which
are included in the relevant major product
category, returned to growth last year with
revenues increasing 60% to £0.8m. During
the year we secured Siemens Medical as a
major new customer for our integrated
NAS connectivity solution to integrate with
the Enterprise DVD libraries they also
purchase from Plasmon. We expect this
trend for major customers to purchase
integrated connectivity and library
solutions from one vendor to increase in
the future and are already discussing
another major opportunity in the medical
imaging market.
We believe the move to networked storage
solutions will continue to be a major trend
within the storage market. Late in 2002 we
commenced development of a new range
of NAS-RAID products that will integrate
internally in our new G-Series libraries and
will provide industry standard connectivity
and performance to optical archive
solutions. The new solutions will be based
on Serial-A T A RAID and Linux software
and will significantly reduce the cost and
complexity of deploying UDO technology.
Other
The majority of this business sector
relates to our optical mastering business
in Caen which had an excellent year in
2002/3 and grew revenues by 31% to
£2.9m. The majority of production is now
CD-R and DVD video masters which we
supply to most of the major disc
manufacturers in the Far East. We are
now entering volume production of DVD-
R masters and expect this to drive further
growth in the coming year.
Longer term we plan to manufacture
masters for Blu-ray video discs and during
the past year we commenced
development of these products. Our
experience with UDO is proving highly
beneficial in this area and should enable
Plasmon to become a leading supplier of
masters and stampers for consumer disc
formats based on blue laser technology. Plasmon Plc 
Annual Report 2003
Chief Executive’s Review
13
Outlook
2002/3 has been a year of consolidation
for Plasmon in which we maintained stable
revenues and significantly reduced our
cost base at a time of industry and
economic downturn. We also made
excellent progress with our UDO
development programme and we are
confident of delivering a world-class
product and securing major OEM support
for our technology in the coming year .
Due to the high profile corporate fraud
cases of the past few years, the market for
secure archival storage products that
provide unalterable records of business
transactions and agreements is very
strong. We are therefore launching UDO at
an ideal time and we believe the inherent
cost and performance features of UDO will
ensure it is highly competitive in the
archival storage market. On this basis we
look forward to the future with confidence
and expect UDO technology to deliver
long-term growth in revenues and
profitability for the Plasmon Group.
Sales of integrated storage solutions
comprising libraries, servers and
Plasmon storage management
software are expected to increase
in the future Plasmon Plc
Annual Report 2003
Finance Director’s Review
14
In the year ended 31 March 2003
overall Group turnover declined
by 2% but the retained loss
reduced by 41 % as the benefits 
of the US reorganisation began to
come through and the level of
exceptional costs fell significantly. 
Timothy Arthur
Finance Director
Finance Director’s Review Plasmon Plc 
Annual Report 2003
Finance Director’s Review
15
The US reorganisation was finally
completed in September 2002 when the
Minneapolis library development
operations were relocated to Colorado
Springs at an exceptional cost of £0.5m,
principally comprising employment related
severance costs. 
The UDO drive and media development
programmes continue to make good
progress with working prototypes being
demonstrated at trade shows in both the
US and Europe. During the year ended 31
March 2003, £6.5m of UDO development
costs were fully expensed and a further
£3.9m was spent on related capital
purchases. T o assist in the funding of the
UDO capital expenditure, £1.7m of cash
was raised through a successful 5%
placing completed in June 2002. 
In March 2003 we completed a new £7m
debt and working capital facility with
Venture Finance PLC that is committed for
three years. We also renewed the $10m
facility with Silicon Valley Bank for a further
year in May 2003 and we now have
sufficient funds to complete the UDO
development project and marketing
launch initiatives. 
Turnover
Turnover fell by 2% to £60.1m from
£61.6m in the previous year, after a
£1.6m adverse foreign exchange
movement on US sales. Sales to IBM
also declined a further £4m as
anticipated, however, this was largely
offset by increased channel sales. 
In geographical terms, US origin revenues
decreased by 11% to £39.6m due to the
adverse foreign exchange impact
compounded by the decline in IBM sales.
In contrast, European origin sales rose by
17% to £20.5m due to strong channel
sales, particularly in the UK and Germany,
and increased sales by our mastering
business in Caen, Northern France.
Operating profit
Operating profits excluding UDO
development costs, goodwill amortisation
and exceptional costs rose by 30% to
£5.5m with a £0.7m reduction in gross
profits being more than offset by a £2.0m
decrease in operating expenses. In
percentage terms, gross margin fell slightly
to 36.3% in 2002/3 from the 36.7%
achieved in the previous year , primarily due
to the reduced revenue. The 11%
reduction in overheads was primarily due
to the savings from the US reorganisation
combined with the weaker dollar . 
First half operating profits excluding UDO
development costs, goodwill amortisation
and exceptional costs of £2m were
followed by a second half adjusted profit of
£3.5m with the benefits of the US
reorganisation accounting for the majority
of the improvement.
Losses before tax and interest in North
America totalled £5.2m compared to the
prior year loss of £6.4m with the reduced
reorganisation costs more than offsetting
the increased UDO expenditure. In Europe
profits before tax and interest rose by
269% to £2.5m due to a strong
contribution by our mastering business, a
return to profitability in the European sales
business as a result of the sales growth
and the non-reoccurrence of the prior year
£0.6m exceptional bad debts. 
Interest
Net interest payable of £0.7m in the
current year compared to £0.5m incurred
during the previous year , largely as a result
of the increased debt levels arising from
the UDO expenditure.  Plasmon Plc
Annual Report 2003
Finance Director’s Review
16
Tax
The tax charge for the year mainly related
to the overseas European subsidiaries with
the UDO costs significantly reducing the
tax charge at the principal operating
entities. During the year a £0.5m cash
refund was received in the US from the
prior year tax credit that arose under the
Job Creation and Worker Assistance Act
of 2002. 
Full details of potential deferred tax
assets, which all arise in the US, are
given in Note 18, although these have 
not been recognised in the financial
statements as they will not be utilised in
the short-term. The deferred tax liabilities
arising from accelerated capital
allowances in the UK have been
recognised in full during the year.
Earnings per share
For the year ended 31 March 2003, 
basic losses per share totalled 6.41p,
significantly better then the 12.28p
recorded during the previous year even
though the weighted average number of
shares in issue rose by 6.2m to 53.1m.
Excluding UDO development costs,
exceptional costs and goodwill
amortisation, earnings per share fell
slightly to 8.86p from 8.96p the 
previous year.
Dividends
The dividend policy of the Group
continues to be monitored by the Board
with no dividend being proposed in the
short-term given the funding requirements
of the Group’s UDO development plans.
Financial instruments
Although kept under consideration during
the past year the Group did not use any
derivative financial instruments with the
principal financial risks being addressed
as follows:
Interest rate risk
The Group’s objective is to minimise
exposure to interest rate fluctuations by
maximising the amount of fixed rate
borrowings whilst retaining sufficient
overdraft facilities to match short-term
debt fluctuations. Anticipated interest rate
movements are taken into consideration
before fixed rate transactions are
concluded. At 31 March 2003, 13% of
financial liabilities were of a fixed nature. 
Foreign currency exposures
The Group’s objective is to minimise
exposure to translational losses arising
on the net assets of overseas subsidiaries
by borrowing in local currencies at the
subsidiary level where possible. At the
year-end, 28% of the net operating
assets of the Group’s US operations were
hedged by US dollar denominated
financial liabilities.
With respect to transactional risks, the
Group continues to monitor its foreign
currency exposures in its major trading
currencies. Matching trading relationships
and debt with the currency cash flows
largely covers transactional exposures
within acceptable levels, thereby reducing
the need for additional hedging.
Liquidity risk
The Group’s policy is to ensure sufficient
headroom is maintained in its debt
facilities to enable the achievement of
strategic objectives, whilst taking into
account the impact of short-term business
cycle fluctuations on liquidity. Facilities are
reviewed on at least an annual basis or as
changes in business circumstances
require. At 31 March 2003, £6.2m of
headroom was available under the Group’s
banking agreements.
The Group also aims to ensure that
reasonable proportions of its financial
liabilities are of a long-term nature. At 31
March 2003, 55% of financial liabilities
mature in more than one year , compared
to 44% the previous year , and 20% mature
in more than five years broadly in line with
the previous year .
Cash flow and net debt
Net debt increased during the year ended
31 March 2003 by £3.1m to £13m. Group
gearing rose from 24% to 34% with the
equity issued following the 5% placing
partially offsetting the losses incurred
during the year . The major currency
movements during the year resulted in a
£1.6m loss being recorded on the
translation of the foreign currency net
investments and net assets decreased to
£38.2m at 31 March 2003 from £41.2m at
the end of the previous year . 
Excluding currency movements, stock
decreased by £1.2m as the transition
stock held at 31 March 2002 as part of the
US reorganisation was sold. This reduction
was also the main reason why trade
creditors fell by £2.3m. The £1.2m
reduction in provisions for liabilities and
charges resulted from the payment of
transitional costs, mainly relating to
employee severance. Excluding UDO
related expenditure, fixed assets additions
totalled £2.6m, which included the
purchase of the adjacent site to our UK
facilities for £0.8m. This facility
unexpectedly became available and will
ensure we have adequate space once
UDO is in full production. In the short-term
we have sub-let the building to cover the
related costs.
Employees
The average number of employees
during the year ended 31 March 2003 fell
to 458 from 496 during the previous year.
The decrease mainly resulted from the
reductions that followed the US
reorganisation that was completed by
the end of September 2002. The full
impact of the restructuring is more
accurately reflected in the 422
headcount in April 2003. Plasmon Plc 
Annual Report 2003
Board of Directors
17
Robert Longman
Group Technical Director
Aged 55
Christopher Harris
President – Plasmon USA
Aged 41
Robert Clark
Senior Vice President of US
sales and marketing
Aged 57
Senior Management
John Barrie Morgans
Chairman
Aged 61
Appointed in 1990. He was
Chairman and Chief Executive 
of IBM United Kingdom until
March 1997. Chairman of
T elemedic Holdings plc and 
Non-Executive Director of Legal 
& General Group plc.
Timothy Arthur 
BSc, FCA
Finance Director 
Aged 40
Appointed Finance Director in
September 1994. Previously three
years as Finance Director of a high
technology manufacturer , then a
subsidiary of Carlton
Communication plc and seven
years at Price Waterhouse.
Henri Zinsli 
Dr . oec.
Non-Executive
Aged 62
Left Ciba Specialty Chemicals,
Inc. after 33 years in March 1999.
Chairman of Discovery Partners
International AG, Non-Executive
Director of Paradigm Genetics Inc
and Chairman of Covalys
Bioscience AG.
Christopher McFadden
MIEE, BSc, PhD
Non-Executive
Aged 43
Appointed in 2001. T elecoms and
technology research analyst for
the last 17 years. Holds a PhD in
SemiConductor Physics from
Cambridge University.
Nigel Street 
BSc, MBA
Chief Executive 
Aged 45
Appointed Chief Executive in
September 1997 having joined the
Company as a Non-Executive
Director in 1987 before becoming
Commercial Director in 1990.
Previously six years at Rothschild
Ventures Limited.
Board of Directors
Board of Directors
& Senior Management Corporate governance
The Directors recognise the importance of adopting good governance
practices in the best interests of the shareholders. 
Throughout the year the Company has been in compliance with the
provisions set out in the Combined Code for Corporate Governance
appended to the Listing Rules of the UK Listing Authority, with the
exception that a Senior Non-Executive Director, Henri Zinsli, was only
appointed on 19 September 2002. The Board continues to monitor
the latest corporate governance guidance to ensure that the Group
maintains the appropriate standards. 
As outlined below, the Board has considered the independence of the
non-executive directors and believes that all the non-executive
Directors are currently independent of management and free from any
business or other relationship which could materially interfere with the
exercise of their independent judgement. 
The following narrative statement explains how the Group has applied
the Principles of Good Corporate Governance contained in the
Combined Code.
The Board
The Board comprises two executive Directors and three non-executive
Directors. It is headed by a non-executive Chairman and is responsible
to shareholders for leading and controlling the Group. It meets at least
six times a year, reviewing trading performance, ensuring adequate
funding facilities are in place, setting and monitoring strategy,
reviewing risk management processes, examining business expansion
opportunities and shareholder reporting.
When appointing new directors, the Board principally considers their
experience and knowledge of the technology sector together with
their ability to contribute to a specific area of importance to the
Company. Due to the infrequent changes to the Board there is no
formal induction policy for new directors, with appropriate
arrangements being made as required.
To enable it to carry out its responsibilities, the Chief Executive and
Finance Director supply detailed information on the Group’s
operations to the Board on a monthly basis.
It is the Company’s policy that all directors should submit themselves
for re-election at regular intervals and at least every three years. The
Director submitting himself for re-election this year is shown on
page 23.
The Board has both an audit committee and a remuneration
committee, details of which are outlined below, but does not consider
a nomination committee to be necessary due to the small size of the
Board.
The Audit Committee
The Audit Committee, which is chaired by John Barrie Morgans,
comprises all the non-executive Directors and meets not less than
twice annually. The Audit Committee provides a forum for reporting by
the Group’s Auditors and, by invitation, meetings are attended by the
Chief Executive and the Finance Director. It is responsible for reviewing
a wide range of financial matters, including the Interim and Annual
Report prior to their submission to the Board, and monitoring the
controls that are in force to ensure the integrity of the financial
information reported to the shareholders. The Audit Committee
advises the Board on the appointment of external Auditors and on
their remuneration for audit and non-audit work, and discusses the
nature and scope of the audit with the external Auditors.
The members of the Audit Committee are:
John Barrie Morgans (Chairman)
Henri Zinsli
Christopher McFadden
The Remuneration Committee
The Remuneration Committee is responsible for determining the
contract terms, remuneration and other benefits of the executive
Directors, including their performance-related pay. The Remuneration
report, which includes details of Directors’ remuneration and beneficial
interests in the Company’s share capital, together with information on
their service contracts, is set out on pages 18 to 22
The members of the Remuneration Committee are:
Christopher McFadden (appointed Chairman 19 September 2002)
John Barrie Morgans (resigned as Chairman 19 September 2002)
Henri Zinsli
Relations with shareholders
As part of the Company’s communication activities, detailed
presentations are made to major institutional investors on a regular
basis, including whenever a major event occurs. The Board takes
feedback received from these presentations and other
communications for shareholders, into consideration wherever
appropriate.
The Annual General Meeting is the occasion when the Directors are
routinely available to answer questions from shareholders, and the
Directors view this public accountability for their actions as being the
main purpose of the meeting.
Plasmon Plc
Annual Report 2003
Corporate governance
18 Accountability and Audit
Following the publication in September 1999 of the guidance for
Directors on internal control reviews and disclosures prepared by the
Internal Control Working Party of the Institute of Chartered
Accountants in England and Wales (the Turnbull Guidance), the
Directors confirm that processes have operated throughout the year,
and continue to operate, to identify, evaluate, monitor and manage the
significant risks to the Group’s strategic objectives.
These processes are reviewed at each Audit Committee meeting with
the Executive Directors who present a report detailing the significant
Group risks identified by senior management during the day-to-day
running of the business. The senior management review the risks and
related control procedures at their regular meetings.
The Board has overall responsibility for the Group’s systems of internal
control and for monitoring their effectiveness. The Audit Committee
reports to the Board on the results of their review of the risk
management processes with the Board implementing additional
controls and monitoring processes as considered necessary. Such
processes can only provide reasonable assurance of the management
of risk and cannot eliminate the risk of failure to achieve the Group’s
business objectives. The key elements of the Group’s internal controls
are outlined below.
Control environment – the existence of a clear organisational structure
and well-defined lines of responsibility and delegation of appropriate
authority. The integrity and competence of personnel are ensured
through high recruitment standards, training and development
programmes.
Risk management – business strategy and plans are reviewed by the
Board. Detailed appraisals and evaluations of financial implications are
undertaken prior to commitments on major projects. In addition to the
Audit Committee presentations, the monthly report to the Board
includes commentary on the key risk areas.
Financial reporting – comprehensive systems of budgeting and
forecasting including monthly reporting of actual results against
budgets.
Control procedures and monitoring systems – ensuring authorisation
levels, procedures and other systems of internal financial control are
documented, applied and regularly reviewed. Many of the processes
are documented in the Group’s quality manuals and are subject to
audit by external compliance agencies on a regular basis. In addition,
the Audit Committee meets with the Group’s external Auditors to
discuss the results of their audit work. The Group does not currently
have an internal audit function but as the Group continues to grow this
is kept under review.
Going concern
After making appropriate enquiries, the Directors have a reasonable
expectation that the Company has adequate resources to continue in
operational existence for the foreseeable future. For this reason they
continue to adopt the going concern basis in preparing the accounts.
Plasmon Plc
Annual Report 2003
Corporate governance
19 Plasmon Plc
Annual Report 2003
Remuneration report
20
This report has been prepared in accordance with the provisions of
Schedule B of the Combined Code and only the details of Directors’
emoluments, pension entitlements and share options have been
subject to audit.
The Remuneration Committee (“the Committee”) is composed entirely
of the non-executive Directors identified on page 17. On
19 September 2002, Christopher McFadden was appointed Chairman
of the Committee, replacing John Barrie Morgans who remains a
member of the Committee. In determining its remuneration policy,
service contracts and compensation for Directors, full consideration
has been given to the provisions of the Combined Code. 
The Committee meets as required during the year and its terms of
reference are to determine the Company’s policy on executive
remuneration and to consider and approve the individual terms and
conditions of employment for the executive Directors. The Committee
takes advice where appropriate from the Chief Executive of the
Company on matters other than his personal remuneration. No
external advice was sought during the year ended 31 March 2003.
Remuneration policy
Basis of the remuneration policy 
In forming the remuneration policy and the remuneration packages of
the executive Directors, the Committee balances the requirement to
align the interest of the Directors with those of the shareholders, with
the creation of a culture of linking reward to the Company’s
performance and with the need to recruit and retain management of
the highest calibre.
The executive Directors’ remuneration consists of four components –
basic salary, performance-related bonus, share options and pension
provisions. The performance related components comprising the
annual bonus and share option schemes are designed to incentivise
the executive Directors to perform at the highest level, and to align
executive rewards with enhanced shareholder value in both the short
and long-term.
Basic salary is reviewed annually by the Committee after a review of
the individual executive Director’s performance and the overall
performance of the business. Where appropriate, the Committee has
regard to published remuneration information and to specific advice
from independent remuneration consultants. Inflation is also taken into
consideration.
The Committee determines a bonus for each executive Director based
on criteria agreed with that executive Director at the beginning of the
financial year. These criteria include the achievement of budgeted
profits and earnings per share. Bonuses are uncapped. The
Committee also awards one-off bonuses for any major activities, such
as acquisitions, not taken into consideration in the budget.
Performance chart
The chart below compares the growth in value of £100 invested in
ordinary shares in Plasmon Plc on 1 April 1998 with the performance
of a similar investment in the shares of the constituents of the FTSE
Small Cap index. The Directors are of the view that this constitutes a
relevant broad equity market. 
Pension provisions 
The executive Directors receive pension contributions equal to 15 per
cent of basic salary which are paid into their personal money purchase
pension plans. Details of the schemes are given in Note 26.
Service contracts 
The executive Directors are employed under the terms of service
agreements dated 19 July 1996 which may be terminated by
12 months’ notice from either party. None of the Directors’ service
contracts provides for predetermined amounts of compensation in the
event of early termination. 
Policy on outside appointments 
It is the policy of the Committee that executive Directors should not
take more than one outside appointment, which it is believed can
provide valuable experience. Nigel Street is a non-executive Director of
Streason Limited, the holding company of his family’s business
interest.
Non executive fees 
The Board determines remuneration of the non-executive Directors.
The Company has a contract with MAHE-Morgans Limited, dated
1 July 1997, which provides the services of John Barrie Morgans as a
non-executive Director and which can be terminated by 6 months’
notice from either party. Henri Zinsli and Christopher McFadden have
contracts with the Company, dated 1 April 1999 and 19 July 2001,
respectively, terminable by three months’ notice from either party. 
Remuneration report
0
100
200
300
400
500
600
April
2003
April
2002
April
2001
April
2000
April
1999
April
1998
Plasmon Plc Ordinary Shares FTSE Small Cap Index Plasmon Plc
Annual Report 2003
Remuneration report
21
Directors’ emoluments
The remuneration of the Directors, excluding pension contributions, was as follows:
Total Total
Salary Benefits
(i)
2003 2002
£ £ £ 
Executive Directors
Nigel Street (Chief Executive) 215,000 21,239 236,239 240,154 
Timothy Arthur (Finance Director) 141,094 16,326 157,420 163,580 
Non-executive Directors
John Barrie Morgans (Chairman)
(ii)
20,004 – 20,004 20,004 
Henri Zinsli (Switzerland) 15,000 – 15,000 15,000 
Christopher McFadden (appointed 19 July 2001) 15,000 – 15,000 10,519 
Paul Robert Nailor (resigned 19 July 2001) – – – 4,558 
406,098 37,565 443,663 453,815 
(i) Benefits comprise disability and medical insurance, life insurance cover and fully expensed cars or equivalent allowance.
(ii) Fees payable in respect of John Barrie Morgans are paid to MAHE-Morgans Limited. 
Directors’ pension entitlements
Pension contributions to money purchase pension schemes for the year ended 31 March 2003 were as follows:
Total Total
2003 2002
£ £ 
Nigel Street 32,250 32,250 
Timothy Arthur 21,164 21,164 
53,414 53,414 
Interest in shares
The interest of the Directors in the shares of the company at 31 March 2003 were as follows:
Number of Number of
shares shares
31 March 31 March
2003 2002
Nigel Street 91,885 91,885 
Timothy Arthur 131,092 131,092 
John Barrie Morgans 111,885 101,885 
Henri Zinsli (Switzerland) 7,500 7,500 
There have been no movements in the Directors’ interest as shown above since 31 March 2003. Plasmon Plc
Annual Report 2003
Remuneration report
22
Remuneration report continued
Interest in share options
Details of options held by Directors at 31 March 2003 are set out below:
SubscriptionNumber Number 
price per of shares of shares 
share 1 April 2002 Granted Lapsed 31 March 2003 Periods within which exercisable
Nigel Street £1.25 100,000 100,000 – 14 April 1995 and 13 April 2002
£2.50 50,000 50,000 – 14 April 1995 and 13 April 2002
£1.25 126,000 126,000 21 May 1996 and 20 May 2003
£2.50 60,000 60,000 21 May 1996 and 20 May 2003
£0.77 600,000 600,000 13 January 2002 and 12 January 2009
£1.37 70,000 70,000 5 August 2002 and 4 August 2010
£0.875 – 500,000 500,000 18 June 2005 and 17 June 2012
Timothy Arthur £1.25 40,000 40,000 5 September 1997 and 4 September 2004
£2.50 20,000 20,000 5 September 1997 and 4 September 2004
£1.25 20,000 20,000 9 April 1999 and 8 April 2006
£2.50 30,000 30,000 9 April 1999 and 8 April 2006
£1.25 20,000 20,000 20 June 1999 and 19 June 2006
£0.77 400,000 400,000 13 January 2002 and 12 January 2009
£1.37 35,000 35,000 5 August 2002 and 4 August 2010
£0.875 – 300,000 300,000 18 June 2005 and 17 June 2012
The performance criteria attached to the options with a subscription price of £0.77, £1.37 and £0.875 are outlined in Note 20 to the financial
statements. 
The other options shown above have no performance criteria attached to them. No initial consideration was required for the options.
The only change in the interests set out above between 31 March 2003 and 28 May 2003 is with repect to Nigel Street’s £1.25 and £2.50 options
which lapsed on 20 May 2003.
The market price of the Company’s shares at the end of the financial year was 100.0p and the range of market prices during the year was between
57.0p and 107.0p. Plasmon Plc
Annual Report 2003
Directors’ report
23
The Directors present their report together with the audited financial
statements for the year ended 31 March 2003.
Activities, business review and product development
Plasmon Plc is the holding company of a group of companies involved
in professional data storage solutions. The Group is active in the
development, manufacture and selling of both optical disk and
magnetic tape data storage systems. The Group operates principally
in the UK and USA but also has operations in Belgium, France,
Germany and Italy.
A review of the Group’s activities and its future development is
contained on pages 1 to 16. During the year, £10,139,000
(2002: £11,408,000) was spent on development of which £6,495,000
(2002: £5,246,000) related to the UDO drive and media programme.
Results for the year
The Group made a loss of £3,406,000 (2002 loss: £5,757,000) after
taxation and no dividends have been declared.
Annual General Meeting
Notice of the Annual General Meeting is enclosed together with a form
of proxy. 
Share capital
Changes in the share capital of the Company are detailed on page 41.
Directors and their interests
The present Directors are listed on page 17 and their beneficial
interests in the shares of the Company are given on pages 21 and 22.
Re-election
John Barrie Morgans is due to retire by rotation at the forthcoming
Annual General Meeting and, being eligible, offers himself for re-
election.
Charitable and political contributions
The Group has made no charitable or political contributions during the
year.
Substantial shareholdings
As at 27 May 2003, the following had notified the Company of interest
in 3% or more of the ordinary share capital of the Company:
Ordinary shares
Number %
Amvescap Plc and subsidiary companies 8,370,628 15.46
Global Asset Management Ltd 5,195,000 9.60
Herald Investment Trust plc 3,350,000 6.19
BriTel Fund Nominees Ltd
The Trustees of the BT Pension Scheme 2,760,321 5.10
Possfund Nominees Ltd
Post Office Pension Trustees 2,088,755 3.86
The family interests of JP Lobbenberg 1,893,852 3.50
Royal Bank of Scotland Group plc 1,675,290 3.09
Legal & General Group Plc 1,637,000 3.02
Employees
The Group’s policy is to consult and discuss with employees those
matters likely to affect employees’ interests. These meetings also seek
to achieve a common awareness on the part of all employees of the
financial and economic factors affecting the Group’s performance. The
employee share scheme encourages the involvement of employees in
the Group’s performance.
It is the policy of the Group that disabled people, whether registered or
not, should receive full and fair consideration for all job vacancies for
which they are suitable applicants. Employees who become disabled
during their working life will be retained in employment wherever
possible and will be given help with any necessary rehabilitation and
retraining. The Group is prepared to modify procedures and
equipment, wherever this is practicable, so that full use can be made
of an individual’s abilities. Training, career development and promotion
are, as far as practicable, identical for all employees according to their
skills and abilities.
Creditor payment policy
The Group’s current policy concerning the payment of creditors for
revenue and capital suppliers for goods and services is as follows:
• to pay in accordance with its contractual and legal obligations;
• wherever it is reasonable to do so, to settle the terms of payments
with those suppliers when agreeing terms for each transaction and
to ensure that those suppliers are made aware of the terms of
payments by their inclusion in the relevant contracts.
Creditor days for the Company and Group at 31 March 2003 were 43
and 49, respectively (2002: 14 and 54) as calculated in accordance
with the Companies Act 1985. 
Statement of Directors’ responsibilities
The Directors are required by UK company law to prepare financial
statements for each financial year that give a true and fair view of the
state of affairs of the Company and the Group as at the end of the
financial year and of the profit or loss of the Group for that period.
The Directors confirm that suitable accounting policies have been
applied consistently, and reasonable and prudent judgements and
estimates have been made in the preparation of the financial
statements for the year ended 31 March 2003. The Directors also
confirm that applicable accounting standards have been followed and
that the financial statements have been prepared on the going
concern basis.
The Directors are responsible for keeping proper accounting records,
for taking reasonable steps to safeguard the assets of the Company
and the Group, and to prevent and detect fraud and other irregular
activities.
The maintenance and integrity of the Group’s websites are the
responsibility of the Directors. Legislation in the United Kingdom
governing the preparation and dissemination of financial statements
may differ from legislation in other jurisdictions.
Auditors
Following the conversion of our auditors PricewaterhouseCoopers to a
Limited Liability Partnership (LLP) from 1 January 2003,
PricewaterhouseCoopers resigned on 30 January 2003 and the
Directors appointed its successor, PricewaterhouseCoopers LLP , as
auditors.
A resolution to reappoint PricewaterhouseCoopers LLP as auditors to
the Company will be proposed at the Annual General Meeting.
By order of the board
T Arthur
Company Secretary
28 May 2003
Directors’ report
for the year ended 31 March 2003 Plasmon Plc
Annual Report 2003
Independent auditors’ report to the members of Plasmon Plc
24
We have audited the financial statements which comprise the profit
and loss account, the balance sheet, the cash flow statement, the
statement of recognised gains and losses and the related notes and
the accounting policies set out in the statement of accounting policies.
We have also audited the disclosures required by Part 3 of Schedule
7A to the Companies Act 1985 contained in the Remuneration report
(“the auditable part”).
Respective responsibilities of directors and auditors
The directors’ responsibilities for preparing the annual report and the
financial statements in accordance with applicable United Kingdom
law and accounting standards are set out in the statement of
directors’ responsibilities. The directors are also responsible for
preparing the Remuneration report.
Our responsibility is to audit the financial statements and the auditable
part of the directors’ remuneration report in accordance with relevant
legal and regulatory requirements and United Kingdom Auditing
Standards issued by the Auditing Practices Board. 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
auditable part of the Remuneration report have been properly
prepared in accordance with the Companies Act 1985. 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 information specified by law regarding
Directors’ remuneration and transactions is not disclosed.
We read the other information contained in the annual report and
consider the implications for our report if we become aware of any
apparent misstatements or material inconsistencies with the financial
statements. The other information comprises only the Directors’
report, the unaudited part of the Remuneration report, the Chairman’s
Statement, the Chief Executive’s review, Finance Director’s review and
the Corporate Governance statement. 
We review whether the Corporate Governance statement reflects the
Company’s compliance with the seven provisions of the Combined
Code specified for our review by the Listing Rules of the Financial
Services Authority, and we report if it does not. We are not required to
consider whether the board’s statements on internal control cover all
risks and controls, or to form an opinion on the effectiveness of the
Group’s corporate governance procedures or its risk and control
procedures. 
Basis of audit opinion
We conducted our audit in accordance with auditing standards issued
by the Auditing Practices Board. An audit includes examination, on a
test basis, of evidence relevant to the amounts and disclosures in the
financial statements and the auditable part of the Remuneration
report. 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 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 the auditable part of the Remuneration report
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.
Opinion
In our opinion:
• the financial statements give a true and fair view of the state of affairs
of the Company and the Group at 31 March 2003 and of the loss
and cash flows of the group for the year then ended;
• the financial statements have been properly prepared in accordance
with the Companies Act 1985; and
• those parts of the Remuneration report required by Part 3 of
Schedule 7A to the Companies Act 1985 have been properly
prepared in accordance with the Companies Act 1985.
PricewaterhouseCoopers LLP
Chartered Accountants and Registered Auditors
London
28 May 2003
Independent auditors’ report to the members of Plasmon Plc Consolidated profit and loss account
for the year ended 31 March 2003
Before Before
goodwill Goodwill goodwill Goodwill
amortisation amortisation amortisation amortisation
and and and and
exceptional exceptional exceptional exceptional
costs costs Total costs costs Total
2003 2003 2003 2002 2002 2002
Notes £’000 £’000 £’000 £’000 £’000 £’000
Turnover 2 60,083 – 60,083 61,554 – 61,554 
Cost of sales (38,258) – (38,258) (38,985) – (38,985)
Gross profit 21,825 – 21,825 22,569 – 22,569 
Operating expenses
Existing 3,4 (16,360) (1,619) (17,979) (18,368) (4,713) (23,081)
UDO development 3 (6,495) – (6,495) (5,246) – (5,246)
Net operating expenses (22,855) (1,619) (24,474) (23,614) (4,713) (28,327)
Operating profit/(loss)
Existing 5,465 (1,619) 3,846 4,201 (4,713) (512)
UDO (6,495) – (6,495) (5,246) – (5,246)
Operating loss (1,030) (1,619) (2,649) (1,045) (4,713) (5,758)
Interest receivable 7 – 36 
Interest payable 8 (737) (577)
Loss on ordinary activities 
before taxation 2,6 (3,386) (6,299)
Tax on ordinary activities 9 (20) 542 
Retained loss for the year 21 (3,406) (5,757)
Basic and diluted losses
per Ordinary share (p) 10 (6.41) (12.28)
Basic earnings per Ordinary share (p) 
excluding UDO development costs,
exceptional costs and goodwill 
amortisation 10 8.86 8.96 
There is no difference between the loss on ordinary activities before taxation and the retained loss for the year stated above and their historical
cost equivalents. All the Group’s operations are continuing.
The Company has taken advantage of Section 230 of the Companies Act 1985 not to present its own profit and loss account.
The amount of loss dealt with in the financial statements of the holding company was £247,000 (2002 loss: £3,365,000).
Plasmon Plc
Annual Report 2003
Consolidated profit and loss account
25 Statement of total recognised gains and losses
for the year ended 31 March 2003
2003 2002
£’000 £’000
Loss for the year (3,406) (5,757)
Currency translation differences on foreign currency net investments (1,563) (288)
Total recognised losses relating to the year (4,969) (6,045)
Reconciliation of movements in shareholders’ funds
for the year ended 31 March 2003
2003 2002
£’000 £’000
Loss for the year (3,406) (5,757)
Currency translation differences (1,563) (288)
Nominal value of new share capital placed 128 660
Premium on share placing 1,634 10,296 
Expenses on share placing (84) (673)
Nominal value of stock options 26 –
Premium on exercise of stock options 347 4
Net (reductions)/additions to shareholders’ funds (2,918) 4,242
Opening shareholders’ funds 41,157 36,915
Closing shareholders’ funds 38,239 41,157
Plasmon Plc
Annual Report 2003
Statement of total recognised gains and losses
26 Consolidated balance sheet
at 31 March 2003
2003 2002
Notes £’000 £’000
Fixed assets
Intangible assets 11 7,204 9,209
Tangible assets 12 26,117 24,421
33,321 33,630
Current assets
Stocks 14 16,455 18,854
Debtors 15 14,955 15,861
Cash at bank and in hand 1,171 1,668
32,581 36,383
Creditors: amounts falling due within one year 16 (19,843) (21,883)
Net current assets 12,738 14,500
Total assets less current liabilities 46,059 48,130
Creditors: amounts falling due after more than one year 17 (7,741) (5,620)
Provisions for liabilities and charges 18 (79) (1,353)
Net assets 38,239 41,157
Capital and reserves
Called-up share capital 20 2,707 2,553
Share premium account 21 42,069 40,172
Profit and loss account 21 (6,537) (1,568)
Equity shareholders’ funds 38,239 41,157
The financial statements on pages 25 to 48 were approved by the Board of Directors on 28 May 2003 and are signed on its behalf by:
J B Morgans
Directors
N Street
Plasmon Plc
Annual Report 2003
Consolidated balance sheet
27
} Company balance sheet
at 31 March 2003
2003 2002
Notes £’000 £’000
Fixed assets
Investments 13 29,203 17,548
Current assets
Debtors 15 13,359 22,872
Cash at bank and in hand 283 586
13,642 23,458
Creditors: amounts falling due within one year 16 (139) (104)
Net current assets 13,503 23,354
Net assets 42,706 40,902
Capital and reserves
Called-up share capital 20 2,707 2,553
Share premium account 21 42,069 40,172
Other reserves 21 1,116 1,116
Profit and loss account 21 (3,186) (2,939)
Equity shareholders’ funds 42,706 40,902
The financial statements on pages 25 to 48 were approved by the Board of Directors on 28 May 2003 and are signed on its behalf by:
J B Morgans
Directors
N Street
Plasmon Plc
Annual Report 2003
Company balance sheet
28
} Consolidated cash flow statement
for the year ended 31 March 2003
2003 2002
Notes £’000 £’000
Net cash inflow/(outflow) from operating activities 22 924 (399)
Returns on investments and servicing of finance
Interest received – 41
Interest paid on bank loans and overdrafts (569) (476)
Interest paid on finance leases (183) (165)
Net cash outflow from returns on investments and servicing of finance (752) (600)
Taxation
UK corporation tax received/(paid) 60 (306)
Overseas tax received/(paid) 479 (195)
Tax received/(paid) 539 (501)
Capital expenditure
Purchase of intangible fixed assets (24) (967)
Purchase of tangible fixed assets (5,081) (7,352)
Proceeds from sale of fixed assets 120 68
Net cash outflow from investing activities (4,985) (8,251)
Net cash outflow before financing (4,274) (9,751)
Financing
Issue of Ordinary shares 2,135 10,960
Expenses on issue of Ordinary shares (84) (673)
New bank loans 3,550 1,910
Payment of principal under bank loans (145) (508)
Payment of principal under finance leases (1,371) (1,324)
Net cash inflow from financing 4,085 10,365
(Decrease)/increase in cash (189) 614
Reconciliation of net cash flow to movement in net debt:
(Decrease)/increase in cash (189) 614
Cash outflow from decrease in debt and lease financing (2,034) (78)
Changes in net debt resulting from cash flows (2,223) 536
Inception of finance leases (1,439) (973)
Foreign exchange differences 598 66
Movement in net debt in period (3,064) (371)
Opening net debt (9,897) (9,526)
Closing net debt 23 (12,961) (9,897)
Plasmon Plc
Annual Report 2003
Consolidated cash flow statement
29 Notes to the financial statements
for the year ended 31 March 2003
1 Principal accounting policies
The financial statements have been prepared in accordance with applicable Accounting Standards in the United Kingdom. A summary of the more
important Group accounting policies, which have been consistently applied, is set out below.
Basis of accounting
The financial statements have been prepared under the historic cost basis of accounting.
Basis of consolidation
The consolidated financial statements include the financial statements of Plasmon Plc and all of its subsidiaries, made up to 31 March 2003. The
results of subsidiaries and businesses acquired are included in the consolidated profit and loss account from the date control passes to the
Group. Intra-Group sales and profits are eliminated fully on consolidation.
Turnover
Turnover, which excludes sales between Group companies and trade discounts, represents the invoiced value of goods and services net of value
added tax. Turnover in respect of the sale of goods is recognised when the goods are dispatched to the customer, whilst turnover in respect of the
sale of services is recognised over the period the related work is performed. Turnover from longer-term development work is recognised in
proportion to the costs of the development work undertaken. Turnover in respect of royalties receivable is recognised on an accruals basis as
earned.
Development expenditure
Expenditure on research or development is written off as incurred.
Tangible fixed assets
Fixed assets are stated at cost less accumulated depreciation.
Depreciation is provided on fixed assets when placed into effective use, on a straight-line basis, at rates calculated to reduce each asset at the
end of its effective useful life to its estimated net realisable value. The rates used are as follows:
Land Not depreciated
Buildings 2%
Building improvements 4%–15%
Short leasehold improvements 20%–33%
Office equipment 20%–33%
Research and development, manufacturing and test plant and machinery 10%–25%
Motor vehicles 25%–33%
Leased assets
Assets acquired under finance leases and hire purchase agreements are capitalised and depreciated over the shorter of the lease term and the
useful life of the asset. The capital element of the leasing commitment is shown as obligations under finance leases. The lease rentals are treated
as consisting of capital and interest elements. The capital element is applied to reduce the outstanding obligations and the interest element is
charged against profit so as to give a constant periodic charge on the remaining balance outstanding for each accounting period.
Rental payments under operating leases are charged to the profit and loss account on a straight-line basis.
Purchased goodwill
Goodwill arising on acquisitions represents the excess of the fair market value of the consideration over the fair value of the identifiable assets and
liabilities acquired.
FRS 10 “Goodwill and intangible assets” has been adopted from 1 April 1998 and purchased goodwill arising from acquisitions after this date has
been capitalised as intangible assets and is amortised over its useful economic life. 
The useful economic life of goodwill arising on acquisitions after 1 April 1998 is estimated to be between eight and ten years from the date of
acquisition which is primarily based on the number of future generations of products expected to be based on the acquired technologies.
Purchased goodwill arising on acquisitions prior to the adoption of FRS10 remains eliminated against reserves. This goodwill will be charged in the
profit and loss account on any subsequent disposal of the related business.
Licences
Licences acquired for use in proprietary software or manufacturing processes are capitalised at cost. Amortisation commences when the related
product is commercially launched with the cost being amortised on a straight-line basis over the expected life cycle of the product. Current
licences are being amortised over five years.
Fixed asset investments
Fixed asset investments are stated at cost less any amount written-off to reflect a permanent impairment.
Plasmon Plc
Annual Report 2003
Notes to the financial statements
30 Notes to the financial statements continued
for the year ended 31 March 2003
Stocks
Stocks are valued at the lower of cost and net realisable value. Cost comprises expenditure incurred in bringing stocks and work in progress to
their present location and condition. Net realisable value represents the estimated selling price less further production costs to completion and
appropriate selling and distribution costs. Provision is made where necessary for obsolete, slow-moving and defective stocks.
Deferred taxation
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or
events that result in an obligation to pay more, or a right to pay less, tax in the future have occurred at the balance sheet date. Deferred tax assets
are recognised to the extent that the Directors consider that it is more likely than not that there will be suitable taxable profits from which the future
reversal of the underlying timing differences can be deducted. Provision is made for the tax that would arise on the remittance of the retained
earnings of overseas subsidiaries only to the extent that, at the balance sheet date, dividends have been accrued as receivable. Deferred tax is
measured on a non-discounted basis at the tax rates that are expected to apply in the periods in which the timing differences reverse, based on
the tax rates and laws enacted or substantively enacted at the balance sheet date.
Foreign currency translation
Assets and liabilities are translated into sterling at the rate of exchange ruling at the balance sheet date and the results of foreign subsidiaries are
translated at the average rate of exchange for the year. Foreign currency trading transactions are translated at the rate ruling at the time of the
transaction. All foreign currency exchange differences are dealt with in the profit and loss account for the period with the exception of those arising
on consolidation which are shown as movements on reserves.
Patent fees
Costs of acquiring patents are written off as incurred.
Pension costs
Pension costs in respect of the defined benefit pension scheme are accounted for on the basis of charging the expected cost of providing
pensions over the period during which the Group expects to benefit from the employees’ services. This treatment follows the requirements of
SSAP 24 “Accounting for pension costs”. In addition, the notes to the financial statements provide the transitional disclosures prepared under the
accounting standard FRS 17 “Retirement benefits”. As permitted by this standard, the Group has decided to defer full implementation until the
financial year ending 31 March 2005.
Pension costs in respect of defined contribution schemes and employees’ personal pension plans are charged on an accrual basis in line with
amounts payable in respect of the accounting period.
National Insurance and Share Options
Provision is made for future employer’s National Insurance liabilities in respect of certain outstanding unapproved employee share options. The
provision is calculated at the current National Insurance rate applied to the difference between the market value of the underlying shares at the
balance sheet date and the option exercise prices.
Plasmon Plc
Annual Report 2003
Notes to the financial statements
31 Notes to the financial statements continued
for the year ended 31 March 2003
2 Turnover, profit/(loss) before taxation and net assets
The analysis by geographical area of the Group’s turnover, (loss)/profit before taxation and net assets is set out below:
Total Total
2003 2002
£’000 £’000
Turnover by destination
Europe 18,736 15,773
United States of America 37,106 42,712
Rest of World 4,241 3,069
60,083 61,554
Turnover by origin
Europe 20,517 17,599
United States of America 39,566 43,955
60,083 61,554
Profit/(loss) before taxation
Europe 2,528 686
United States of America (5,177) (6,444)
Loss before interest (2,649) (5,758)
Net interest payable (737) (541)
(3,386) (6,299)
Net assets by origin
Europe 29,763 27,878
United States of America 19,962 21,902
Net operating assets 49,725 49,780
Bank loans and overdrafts (11,388) (8,961)
Current tax (payable)/receivable (67) 485
Deferred tax position (31) (147)
38,239 41,157
The Group operates in one business segment, professional data storage solutions. The Group derives income of a consultancy nature from the
sale of “know-how” as a result of and incidental to its normal production activities and therefore, this is not considered to be a separate business
segment. Consultancy income in the year amounted to £3,935,000 (2002: £3,607,000). Intra segment turnover for year ended 31 March 2003
was £5,325,000 (2002: £7,487,000) from Europe to the United States of America and £4,033,000 (2002: £5,072,000) from the United States of
America to Europe.
3 Net operating expenses
Total Total
2003 2002
£’000 £’000
Administrative expenses 3,747 4,264
Selling and distribution costs 8,993 7,816
UDO product development costs 6,495 5,246
Other product development costs 3,644 6,162
Total product development costs 10,139 11,408
Other operating (income) / expenses (24) 126
Net operating expenses 22,855 23,614
The costs of the UDO development programme have been separately disclosed due to their significance to the Group. This programme is
developing next generation 5
1
⁄ 4" drive and media technology that will supercede existing products currently sourced from third party suppliers.
Plasmon Plc
Annual Report 2003
Notes to the financial statements
32 Notes to the financial statements continued
for the year ended 31 March 2003
4 Goodwill amortisation and exceptional operating costs
2003 2002
£’000 £’000
US Reorganisations 520 2,888
Toolex International bad debt – 629
Exceptional operating costs 520 3,517
Goodwill amortisation 1,099 1,196
Goodwill amortisation and exceptional operating costs 1,619 4,713
The exceptional operating costs during the year ended 31 March 2003 arose from the transfer of US library development from Minneapolis to
Colorado Springs, principally comprising employment related severance costs.
The exceptional operating costs during the year ended 31 March 2002 arose from the transfer of US library manufacturing from Minneapolis to
Colorado Springs, principally comprising employment related transition and relocation costs. The bad debt charge arose from the bankruptcy of
Toolex International NV .
5 Directors and employees
The average monthly number of employees (including Directors) employed by the Group during the year was:
2003 2002
Number Number
Sales and marketing 90 75
Office and management 51 57
Manufacturing, research and development 317 364
458 496
Staff costs for the above employees:
2003 2002
£’000 £’000
Wages and salaries 16,850 18,481
Social security costs 2,938 2,588
Other pension costs 424 881
20,212 21,950
Included in staff costs is remuneration paid to the Directors of Plasmon Plc as follows:
2003 2002
£’000 £’000
Executive directors
– aggregate emoluments 394 404
– pension contributions 53 53
Non-Executive directors
– aggregate fees 50 50
497 507
For further information on Directors’ emoluments see the Remuneration report on pages 20 to 22.
Plasmon Plc
Annual Report 2003
Notes to the financial statements
33 Notes to the financial statements continued
for the year ended 31 March 2003
6 Loss on ordinary activities before taxation
2003 2002
£’000 £’000
Loss on ordinary activities before taxation is stated after charging/(crediting):
Research and development expenditure 10,139 11,408
Depreciation
– leased assets 1,094 828
– owned assets 3,606 3,749
Amortisation
– goodwill 1,099 1,196
– intangibles 208 70
Fees paid to Auditors for:
– audit (Company: 2003: £29,000, 2002 £29,000) 158 189
– other services (Company: 2003: £37,000, 2002: £40,000) 68 131
Operating lease payments
– plant and machinery 203 219
– other 1,034 1,238
(Profit)/loss on sale of fixed assets (24) 32
Foreign exchange gains (441) (121)
Exceptional operating costs (see Note 4) 520 3,517
7 Interest receivable
2003 2002
£’000 £’000
Bank deposits – 36
8 Interest payable
2003 2002
£’000 £’000
Bank loans and overdrafts 564 417
Finance leases and hire purchase contracts 173 160
737 577
Plasmon Plc
Annual Report 2003
Notes to the financial statements
34 Notes to the financial statements continued
for the year ended 31 March 2003
9 Taxation
a) Analysis of tax charge/(credit) in the year
2003 2002
£’000 £’000
UK Corporation tax at 30% (2002: 30%)
Current 7 –
Deferred (116) 147
Under/(over) provision in respect of prior years
Current 14 (107)
(95) 40
Overseas taxation
Current 81 (432)
Under/(over) provision in respect of prior years
Current 34 (150)
115 (582)
Tax on ordinary activities 20 (542)
The overseas tax credit in the year ended 31 March 2002 arose in the US where under the Job Creation and Worker Assistance Act of 2002, the
US subsidiaries were able to carry back net operating losses for the preceding five years.
b) Factors affecting the tax charge/(credit) in the year
The tax credit for the period is lower than the standard rate of corporation tax in the UK (30%).  The differences are explained below:
2003 2002
£’000 £’000
Loss on ordinary activities before tax (3,386) (6,299)
Loss on ordinary activities multiplied by the standard rate of (1,016) (1,890)
corporation tax in the UK of 30% (2002: 30%)
Effects of:
Adjustments to tax in respect of the prior period 14 (107)
Enhanced deduction for research and development (134) –
Expenses not deductible for tax purposes 104 25
Losses (utilised)/carried forward (56) 43
Difference between capital allowance and depreciation (309) (177)
Overseas differences 1,533 1,417
Current tax charge/(credit) for period 136 (689)
c) Factors that may affect future tax charge
At present it is envisaged that any future tax charge will be reduced by the losses carried forward in the US.
Plasmon Plc
Annual Report 2003
Notes to the financial statements
35 Notes to the financial statements continued
for the year ended 31 March 2003
10 Earnings per share
Basic earnings per share are calculated by dividing earnings (loss on ordinary activities after tax) by the weighted average number of Ordinary
shares in issue during the year.
Given the losses incurred during the year, there is no dilution of earnings per share in the year ended 31 March 2003 or in the previous year.
Adjusted earnings per share figures are presented which exclude the effect of goodwill amortisation, UDO development costs and exceptional
operating costs. The Directors consider that the adjusted earnings per share figures provide a useful additional indication of performance.
Weighted Weighted
average (Losses)/ average (Losses)/
(Losses)/ number earnings (Losses)/ number earnings
earnings of shares per share earnings of shares per share
2003 2003 2003 2002 2002 2002
£’000 ‘000 pence £’000 ‘000 pence
Basic losses per share (3,406) 53,140 (6.41) (5,757) 46,900 (12.28)
Adjusted earnings per share
Basic losses per share (3,406) 53,140 (6.41) (5,757) 46,900 (12.28)
Effect of:
goodwill amortisation 1,099 2.07 1,196 2.55
UDO development costs 6,495 12.22 5,246 11.19
exceptional operating costs 520 0.983,517 7.50
Adjusted earnings per share 4,708 53,140 8.86 4,202 46,900 8.96
11 Intangible fixed assets
The Company has no intangible fixed assets. Details of those relating to the Group are as follows:
Purchased Development Software Manufacturing
goodwill costs code licences licences Total
£’000 £’000 £’000 £’000 £’000
Cost
At 1 April 2002 11,328 1,949 349 967 14,593
Acquisitions – – – 24 24
Currency changes (937) – – (91) (1,028)
At 31 March 2003 10,391 1,949 349 900 13,589
Amortisation
At 1 April 2002 3,346 1,949 89 – 5,384
Charge for the year 1,099 – 71 137 1,307
Currency changes (304) – – (2) (306)
At 31 March 2003 4,141 1,949 160 135 6,385
Net book value
At 31 March 2003 6,250 – 189 765 7,204
At 31 March 2002 7,982 – 260 967 9,209
Plasmon Plc
Annual Report 2003
Notes to the financial statements
36 Notes to the financial statements continued
for the year ended 31 March 2003
12 Tangible fixed assets
The Company has no tangible fixed assets. Details of those relating to the Group are as follows:
Freehold Leasehold Plant & Plant &
land and improve- Office Motor machinery Construction machinery
buildings ments equipment vehicles owned in progress leased Total
£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Group
Cost
At 1 April 2002 8,029 719 5,582 318 19,429 2,360 9,624 46,061
Additions – 73 317 39 566 5,525 – 6,520
Disposals – (171) (567) (96) (687) – – (1,521)
Transfer of assets 1,347 – (471) – 462 (1,338) – – 
Currency changes 78 (64) (249) – (88) (17) (7) (347)
At 31 March 2003 9,454 557 4,612 261 19,682 6,530 9,617 50,713
Depreciation
At 1 April 2002 628 540 3,893 106 10,978 – 5,495 21,640
Charge for the year 154 115 600 59 2,721 – 1,051 4,700
Disposals – (169) (531) (43) (682) – – (1,425)
Transfer of assets – – (226) – 226––– 
Currency changes 4 (48) (174) – (99) – (2) (319)
At 31 March 2003 786 438 3,562 122 13,144 – 6,544 24,596
Net book value
At 31 March 2003 8,668 119 1,050 139 6,538 6,530 3,073 26,117
At 31 March 2002 7,401 179 1,689 212 8,451 2,360 4,129 24,421
Tangible fixed assets include leased assets with a cost of £11,405,000 (2002: £9,919,000) and net book value of £4,432,000 (2002: £4,325,000).
Depreciation of £1,094,000 (2002: £828,000) has been charged against these assets in the year.
Plasmon Plc
Annual Report 2003
Notes to the financial statements
37 Notes to the financial statements continued
for the year ended 31 March 2003
13 Fixed asset investments
Investment in
subsidiaries
£’000
Company
Cost
At 1 April 2002 23,052
Additions 17,216
At 31 March 2003 40,268
Provisions for permanent diminution in value
At 1 April 2002 5,504
Provisions created during year 5,561
At 31 March 2003 11,065
Net book value
At 31 March 2003 29,203
At 31 March 2002 17,548
The movement in investments during the year resulted from an increase in the investment in Plasmon Inc of $8,500,500 (£5,716,000), in Plasmon
Data Systems Limited of £10,000,000 and in Plasmon Data Limited of £1,500,000.
The principal subsidiaries of the Group at 31 March 2003 were:
Company Country of incorporation Main activity
Plasmon Inc. USA Holding company
Plasmon Data Systems Limited England & Wales Media manufacturing and development
Plamson OMS Sarl France Mastering manufacturing and development
Plasmon Data Limited England & Wales Sales and marketing
Allstor Software Limited England & Wales Software development
Plasmon IDE Inc. USA Jukebox manufacturing and development
Plasmon LMS Inc. USA Drive manufacturing and development
Plasmon Data Srl Italy Sales and marketing
Plasmon Data NV Belgium Sales and marketing
Plasmon Data Sarl France Sales and marketing
All the principal subsidiaries of the Group only have ordinary share capital, are 100% owned, including voting rights, within the Group and have
been included in the consolidated financial statements.
With the exception of Plasmon IDE Inc., Plasmon LMS Inc., Plasmon OMS, Plasmon Data Sarl and 25% of Plasmon Data Srl all the interests in the
principal subsidiaries are held directly by Plasmon Plc.
14 Stocks
2003 2002
£’000 £’000
Group
Raw materials and consumables 4,143 5,096
Work in progress 2,509 1,889
Finished goods and goods for resale 9,803 11,869
16,455 18,854
Plasmon Plc
Annual Report 2003
Notes to the financial statements
38 Notes to the financial statements continued
for the year ended 31 March 2003
15 Debtors: amounts falling due within one year
2003 2002
£’000 £’000
Group
Trade debtors 9,912 10,898
Corporation tax 14 538
Other debtors 948 1,303
Prepayments and accrued income 4,081 3,122
14,955 15,861
2003 2002
£’000 £’000
Company
Amounts owed by Group undertakings 13,287 22,759
Other debtors 72 113
13,359 22,872
16 Creditors: amounts falling due within one year
2003 2002
£’000 £’000
Group
Bank overdraft 4,088 4,901
Bank loans 1,294 262
Obligations under finance leases 1,009 782
Trade creditors 5,708 8,545
Corporation tax 81 53
Other taxation and social security 182 141
Accruals and deferred income 7,481 7,199
19,843 21,883
2003 2002
£’000 £’000
Company
Bank overdraft 3 –
Trade creditors 66 21
Corporation tax 7 –
Other taxation and social security 18 19
Accruals and deferred income 45 64
139 104
Bank borrowings are secured by fixed and floating charges over the Group’s assets.
17 Creditors: amounts falling due after more than one year
2003 2002
£’000 £’000
Group
Bank loans 6,006 3,798
Obligations under finance leases 1,735 1,822
7,741 5,620
Bank loans are secured by fixed and floating charges over the Group’s assets.
Plasmon Plc
Annual Report 2003
Notes to the financial statements
39 Notes to the financial statements continued
for the year ended 31 March 2003
18 Provisions for liabilities and charges
US
Deferred tax restructuring Total
£’000 £’000 £’000
Group
At 1 April 2002 147 1,206 1,353
Provided in year – 520 520
Utilised in year (116) (1,598) (1,714)
Currency changes – (80) (80)
At 31 March 2003 31 48 79
Deferred tax
All potential deferred tax liabilities have been recognised in the financial statements. These liabilities relate wholly to accelerated capital allowances.
Potential deferred tax assets have not been recognised but are set out below:
2003 2002
£’000 £’000
Group
Research and development tax credits 1,149 987
Trading losses 3,623 1,597
Accelerated capital allowances 416 232
Other short term timing differences 569 1,653
5,757 4,469
The Company had no deferred tax balances at 31 March 2003 and 31 March 2002.
US restructuring provision
The US restructing provision was set up during the year ended 31 March 2002 as an exceptional cost relating to the transfer of the library
manufacturing facilities previously located in Minneapolis to the Group’s other US location in Colorado Springs. During the year ended 31 March
2003, additional provisions were made relating to the transfer of the library development facility also originally located in Minneapolis to Colorado
Springs. The cash impact of the remaining provision is expected to be a cash outflow of £48,000 in 2003/4 (2002/3: £1,206,000). Further details
of the US restructuring costs are given in Note 4.
19 Lease commitments
Obligations under finance leases are repayable as follows:
2003 2002
£’000 £’000
Group
Within one year 1,009 782
One to two years 840 754
Two to five years 895 1,068
2,744 2,604
Obligations under operating leases payable in the next year where the commitment expires as follows:
2003 2002
£’000 £’000
Group
Within one year 253 163
One to two years 24 71
Two to five years 903 1,110
1,180 1,344
Plasmon Plc
Annual Report 2003
Notes to the financial statements
40 Notes to the financial statements continued
for the year ended 31 March 2003
Included in the above is the following amount for the lease of land and buildings:
2003 2002
£’000 £’000
Group
Within one year 72 137
One to two years – 71
Two to five years 902 917
974 1,125
20 Called-up share capital
2003 2002
£’000 £’000
Authorised
80,000,000 Ordinary shares of 5p each (2002: 75,000,000) 4,000 3,750
Allotted, called-up and fully paid
54,142,704 Ordinary shares of 5p each (2002: 51,064,957) 2,707 2,553
During the year the Company issued 2,553,247 5p Ordinary shares following a 5% placing to fund the UDO drive and media development
programme. A further 524,500 5p Ordinary shares were issued upon the exercise of employee share options. Net of expenses the £2,051,000 of
cash received in total represented £154,000 of nominal value and £1,897,000 of share premium.
The Company operates share option schemes for Directors and employees. Options to purchase the Company’s 5p Ordinary shares in issue at
31 March 2003 were as follows:
SubscriptionNumber Number 
price per of shares of shares 
share 1 April 2002 Granted Exercised Cancelled 31 March 2003 Periods within which exercisable
£1.25 132,000 – – 132,000 – 14 April 1995 and 13 April 2002
£2.50 90,000 – – 90,000 – 14 April 1995 and 13 April 2002
£1.25 187,000 – – – 187,000 21 May 1996 and 20 May 2003
£2.50 80,000 – – – 80,000 21 May 1996 and 20 May 2003
£1.25 40,000 – – – 40,000 5 September 1997 and 4 September 2004
£2.50 20,000 – – – 20,000 5 September 1997 and 4 September 2004
£1.25 47,500 – – 27,500 20,000 9 April 1999 and 8 April 2006
£2.50 121,914 – – 59,000 62,914 9 April 1999 and 8 April 2006
£1.25 30,000 – – 5,000 25,000 20 June 1999 and 19 June 2006
£2.50 20,000 – – 10,000 10,000 20 June 1999 and 19 June 2006
£0.465 227,000 – 99,500 44,000 83,500 15 November 2000 and 14 November 2007
£0.465 57,000 – – – 57,000 15 November 2000 and 14 November 2004
£0.77 1,995,000 425,000 123,000 1,447,000 13 January 2002 and 12 January 2009
£1.37 360,000 – – 150,000 210,000 5 August 2002 and 4 August 2009
£2.74 25,000 – – 25,000 – 15 February 2003 and 14 February 2010
£1.14 805,250 – – 169,000 636,250 21 December 2003 and 20 December 2010
£0.765 1,470,000 36,000 1,434,000 22 December 2004 and 21 December 2011
£0.875 927,500 – – 927,500 18 June 2005 and 17 June 2012
£0.765 542,000 – – 542,000 29 July 2005 and 28 July 2012
5,707,664 1,469,500 524,500 870,500 5,782,164 
Plasmon Plc
Annual Report 2003
Notes to the financial statements
41 Notes to the financial statements continued
for the year ended 31 March 2003
1,469,500 share options were granted during the year under the 1998 Employee Share Option Scheme (the "1998 Scheme"). The 1998
Scheme allows for the granting of share options up to 15% of the issued ordinary share capital, normally within 42 days following the
preliminary announcement of the final or interim results of the Company. No payment is required for the grant of the share options and
subscription price per share is set at prevailing market rates. These options, as with those issued during the previous year, require the launch of
UDO drives and media before the options can be exercised.
The share options granted in the four years ended 31 March 2001 (at subscription prices per share of £0.465, £0.77, £1.37, £2.74 and £1.14)
also have performance criteria attached to them. Exercise of these share options is conditional on earnings per share for the Group over any
three consecutive years following grant having grown by an average of at least 6 percentage points above inflation. The earnings per share
criteria will be adjusted to remove the impact of the UDO programme. In addition group profits for any financial year have to exceed the levels
shown in the table below:
Granted during Subscription price 
the year ended per share Measure of group profits Level of group profits
31 March 1998 £0.465 Before interest and tax £1 million
31 March 1999 £0.77 Before goodwill amortisation,
interest, tax and exceptional items £2.5 million
31 March 2000 £1.37 Before goodwill amortisation, £2.5 million
£2.74 interest, tax and exceptional items £4.0 million
31 March 2001 £1.14 Before goodwill amortisation, £7.0 million
interest, tax and exceptional items
The performance criteria attached to the share options granted during the year ended 31 March 1998 and 1999 have been met. The share
options granted at £1.25 and £2.50 do not have performance conditions attached to them.
21 Reserves
Share premium Profit and loss
account account
£’000 £’000
Group
At 1 April 2002 40,172 (1,568)
Premium on share placing 1,634 –
Issue costs of share placing (84) –
Premium on exercise of share options 347 –
Currency translation differences – (1,563)
Retained loss for the year – (3,406)
At 31 March 2003 42,069 (6,537)
Cumulative goodwill arising on consolidation which has been written off to reserves amounted to £1,301,500 at 31 March 2003 and 31 March
2002.
Share Profit
premium Other and loss
account reserves account
£’000 £’000 £’000
Company
At 1 April 2002 40,172 1,116 (2,939)
Premium on share placing 1,634 – –
Issue costs of share placing (84) – –
Premium on exercise of share options 347 – –
Retained loss for the year – – (247)
At 31 March 2003 42,069 1,116 (3,186)
There were no distributable reserves at 31 March 2003 and 2002.
Plasmon Plc
Annual Report 2003
Notes to the financial statements
42 Notes to the financial statements continued
for the year ended 31 March 2003
22 Reconciliation of operating loss to net cash inflow from operating activities
2003 2002
£’000 £’000
Operating loss (2,649) (5,758)
Amortisation of intangible fixed assets 1,307 1,266
Depreciation of tangible fixed assets 4,700 4,577
(Profit)/loss on sale of fixed assets (24) 32
Decrease/(increase) in stocks 1,214 (4,085)
Decrease/(increase) in trade debtors 575 (34)
Increase in prepayments and other debtors (1,011) (2,527)
(Decrease)/increase in trade creditors (2,252) 1,417
Increase/(decrease) in other taxation and social security 41 (7)
Increase in accruals and deferred income 845 3,557
(Decrease)/increase in provisions for liabilities and charges (1,194) 1,223
Other non-cash items (628) (60)
Net cash inflow/(outflow) from operating activities 924 (399)
23 Analysis of net debt
Inception Foreign
At 1 April Cash of finance exchange At 31 March
2002 flow leases gain/(loss) 2003
£’000 £’000 £’000 £’000 £’000
Cash at bank and in hand 1,668 (562) – 65 1,171
Overdrafts (4,901) 373 – 440 (4,088)
(3,233) (189) – 505 (2,917)
Debt due within one year (262) (1,045) – 13 (1,294)
Debt due after one year (3,798) (2,360) – 152 (6,006)
Finance leases due within one year (782) 494 (706) (15) (1,009)
Finance leases due after one year (1,822) 877 (733) (57) (1,735)
Net debt (9,897) (2,223) (1,439) 598 (12,961)
24 Financial instruments
The following information, with the exception of that concerning currency exposures, excludes short term debtors and creditors. Narrative
disclosures explaining the role that the financial instruments play in creating and changing the risks faced by the group in its activities together with
an explanation of the directors’ approach to managing these risks, are given in paragraphs 5 to 10 on page 16 within the Finance Director’s review
under the heading of Financial Instruments. No derivatives have been utilised to hedge either foreign exchange or interest rate movements and
therefore there are no unrecognised gains or losses.
Financial assets
The interest rate and currency profiles of the Group’s financial assets, excluding short term debtors were:
Floating Non-interest Floating Non-interest
rate bearing Total rate bearing Total
2003 2003 2003 2002 2002 2002
£’000 £’000 £’000 £’000 £’000 £’000
Currency
Sterling 283 25 308 543 41 584
US dollar 241 77 318 189 229 418
Other – 545 545 – 666 666
524 647 1,171 732 936 1,668
The financial assets shown in the table above consist solely of cash at bank and in hand. The US dollar denominated floating rate deposits earn
interest based on US prime rates.
Plasmon Plc
Annual Report 2003
Notes to the financial statements
43 Notes to the financial statements continued
for the year ended 31 March 2003
Financial liabilities
The Group’s financial liabilities, excluding short term creditors were:
2003 2002
£’000 £’000
Bank overdraft 4,088 4,901
Bank loans 7,300 4,060
Obligations under finance leases 2,744 2,604
US restructuring provision 48 1,206
14,180 12,771
The interest rate and currency profiles of these financial liabilities were:
Floating Non-interest Fixed Floating Non-interest Fixed
rate bearing rate Total rate bearing rate Total
2003 2003 2003 2003 2002 2002 2002 2002
£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Currency
Sterling 6,797 – 1,069 7,866 2,540 – 1,593 4,133
US dollar 5,546 48 68 5,662 6,721 1,206 – 7,927
Euro – – 652 652 – – 711 711
12,343 48 1,789 14,180 9,261 1,206 2,304 12,771
The sterling and US dollar denominated floating rate liabilities consist principally of bank overdrafts and loans that bear interest based on UK Base
and US Prime rates respectively.
The sterling denominated fixed rate liabilities are obligations under finance leases that have a weighted average interest rate of 7.3% (2002: 7.3%)
and a weighted average period of 2.4 years (2002: 3.4 years) until the end of the leases. The Euro denominated fixed rate liabilities are obligations
under a finance lease that has a weighted average interest rate of 6.5% (2002: 6.5%) and a weighted average period of 3.8 years (2002: 4.8 years)
until the end of the lease.
The US restructuring provision consists principally of building rental costs that will be paid within one year.
Maturity of financial liabilities
The maturity profile of the Group’s financial liabilities was as follows:
2003 2002
£’000 £’000
In one year or less, or on demand 6,439 7,151
In more than one year but not more than two years 2,136 1,041
In more than two years but not more than five years 2,809 1,926
In more than five years 2,796 2,653
14,180 12,771
The UK bank loans denominated in sterling and US dollars total £7,300,000 (2002: £4,060,000) and have a weighted average repayment period
of 9.4 years (14.3 years).
Plasmon Plc
Annual Report 2003
Notes to the financial statements
44 Notes to the financial statements continued
for the year ended 31 March 2003
Currency exposures
The table below shows the extent to which Group companies have monetary assets and liabilities in currencies other than their local currency.
Foreign exchange differences on the translation of these assets and liabilities are taken to the profit and loss account.
Foreign currency monetary assets/(liabilities) at 31 March 2003
Other
Sterling US dollars Euro zone currencies Total
£’000 £’000 £’000 £’000 £’000
Functional currency of Group company
Sterling – (1,623) 3,476 (5) 1,848
US dollar –––––
– (1,623) 3,476 (5) 1,848
Foreign currency monetary assets/(liabilities) at 31 March 2002
Other
Sterling US dollars Euro zone currencies Total
£’000 £’000 £’000 £’000 £’000
Functional currency of Group company
Sterling – (887) 696 (2) (193)
US dollar –––––
– (887) 696 (2) (193)
Borrowings facilities
To manage the liquidity risk the Group has arranged various borrowing facilities. These facilities have various asset related covenants and therefore
the available facilities may be limited.
Maximum Maximum
potential Available Undrawn potential Available Undrawn
facility facility facility facility facility facility
2003 2003 2003 2002 2002 2002
£’000 £’000 £’000 £’000 £’000 £’000
Sterling facilities 7,000 5,867 2,867 2,500 2,500 2,460
US dollar facilities 6,325 5,843 2,189 6,954 6,609 1,748
Total 13,325 11,710 5,056 9,454 9,109 4,208
In March 2003 the £2,500,000 HSBC overdraft facility was replaced with a £7,000,000 debt and working capital facility with Venture Finance PLC
that is committed for three years.
The sterling and US dollar overdrafts are renewable on 13 April 2006 and 8 May 2004 respectively (2002: 3 April 2003 and 30 September 2003).
Fair values of financial assets and financial liabilities
Due to the floating rate and short term nature of the majority of the Group’s financial assets and liabilities there are no material differences between
their book and fair values.
25 Capital commitments and contingent liabilities
At 31 March 2003 the Group had contracted but not provided for capital commitments of £1,956,000 (2002: £1,553,000).
Guarantees have been given by the Company to finance companies, where amounts owned by Plasmon Data Systems Limited under sale and
lease-back transactions are payable on demand. Total amounts outstanding at 31 March 2003 were £2,599,000 (2002: £2,376,000).
The Company guarantees a working capital facility provided by Silicon Valley Bank on behalf of Plasmon Data Inc and subsidiaries for a total value
of US$10,000,000.
The Company has given a guarantee to Sony Electronics Inc in favour of Plasmon Data Inc to cover all amounts outstanding. At 31 March 2003
US$579,440 was outstanding (2002: US$1,029,850).
The Company has given an unlimited Deed of Guarantee and Indemnity to Venture Finance PLC covering the Company, Plasmon Data Systems
Limited and Plasmon Data Limited to secure all loans and facilities of each other. At 31 March 2003, £3,000,000 was outstanding.
Plasmon Plc
Annual Report 2003
Notes to the financial statements
45 Notes to the financial statements continued
for the year ended 31 March 2003
The Company has given an unlimited Multilateral Guarantee to HSBC Bank plc covering Plasmon Data Systems Limited, Allstor Software Limited
and Plasmon Data Limited to secure all bank loans and overdrafts of each other. At 31 March 2003, £3,765,000 was outstanding
(2002: £2,903,000).
The Company guarantees a mortgage provided by the Cambridge Building Society to Plasmon Data Systems Limited. The total amount
outstanding at 31 March 2003 was £535,000 (2002: nil)
The Company has a contingent liability in respect of employer’s National Insurance contributions on certain Unapproved Share Options Schemes.
At 31 March 2003 no amount was accrued (2002: £nil).  A 10% rise in the Company’s share price above the option price of £1.36 would require a
provision of £3,000.
26 Pension Commitments
The Group operates three pension schemes of a defined contribution nature (including two 401K plans in the United States) and also makes
contributions to the private pension plans of a small number of employees (including the two executive Directors). The total pension cost charge
relating to these arrangements was £515,000 (2002: £596,000). There were no material outstanding or prepaid contributions in respect of these
arrangements at either 31 March 2003 or 31 March 2002.
The Group also operates a pension scheme of a defined benefit nature for the US employees who transferred from Philips as part of the
acquisition of Philips LMS. In May 2002, the Group announced the freezing of benefits in this scheme, before on 31 December 2002, announcing
the termination of the scheme, which should be completed by 31 March 2004. As a result of the termination, a net pension credit was recorded in
the year ended 31 March 2003 of £91,000 (2002 cost: £285,000). In setting the funding policy of the scheme, the actuarial method used was the
projected unit cost method and the main actuarial assumptions used were that the investment return will be 8.00% (2002: 8.75%) and that the
pensionable salaries would increase by a weighted average of 4.69% (2002: 4.69%). As part of the termination planning, a formal actuarial
valuation has been performed that shows there is no material difference between the fund’s assets and its accrued liabilities. There were
outstanding contributions of £167,000 in respect of this scheme at 31 March 2003 (2002: £460,000).
The assets of all the Group’s pension schemes are held separately from those of the Group.
The Company has continued to account for pensions in accordance with SSAP 24 “Accounting for Pension Costs”. The new standard for pension
accounting, FRS 17 “Retirement Benefits”, is not yet mandatory, however, the Company is following the extended transitional arrangements under
which additional disclosures on retirement benefits are required. These disclosures are as follows:
The Group operates a defined benefit scheme in the US. A full actuarial valuation was carried out at 31 March 2003 by qualified independent
actuaries. The main financial assumptions used in the valuation of the liabilities of the company’s pension schemes under FRS 17 are:
31 March 31 March
2003 2002
Rate of increase in salaries 4.69% pa 4.69% pa
Rate of increase in pensions in payment 0% pa 0% pa
Discount rate 5.5% pa 7% pa
Inflation assumption 3.0% pa 3% pa
The assets in the scheme and the expected rate of return were:
Long term Long term
rate of return Value at rate of return Value at
expected 31 March expected 31 March
at 31 March 2003 at 31 March 2002
2003 £’000 2002 £’000
Contributions due 0% pa 167 0% pa 460
Equities 8.5% pa 448 9.5% pa 444
Bonds 5.5% pa 156 6.5% pa 162
Other (mainly property) 7.8% pa 55 8.8% pa 55
Total 826 1,121
Plasmon Plc
Annual Report 2003
Notes to the financial statements
46 Notes to the financial statements continued
for the year ended 31 March 2003
The following amounts at 31 March 2003 were measured in accordance with the requirements of FRS 17:
31 March 31 March
2003 2002
£’000 £’000
Total market value of assets 826 1,221
Present value of scheme liabilities (710) (1,402)
Surplus/(deficit) in the scheme 116 (281)
Related deferred tax (liability)/asset (46) 112
Net pension surplus/(deficit) 70 (169)
Analysis of amounts (credited)/charged to operating profit in respect of defined benefit schemes
2003
£’000
Current service 65
Past service cost –
Curtailment gain (728)
Total operating credit (663)
Analysis of the amount credited to other finance income
2003
£’000
Expected return on pension scheme assets 60
Interest on pension scheme liabilities (50)
Net return 10
Analysis of amount recognised in statement of total recognised gains and losses
2003
£’000
Actual return less expected return on pension scheme assets (153)
Experience gains and losses arising on the scheme liabilities (115)
Changes in the assumptions underlying the present value of the scheme liabilities (195)
Actuarial loss recognised in statement of total recognised gains and losses (463)
Movement in surplus/(deficit) during the year
2003
£’000
Deficit in scheme at the beginning of year (281)
Movement:
Current service cost (65)
Contributions 165
Past service cost –
Other finance income 10
Actuarial loss (463)
Curtailment gain 728
Foreign exchange gain 22
Surplus in scheme at end of year 116
Plasmon Plc
Annual Report 2003
Notes to the financial statements
47 Notes to the financial statements continued
for the year ended 31 March 2003
History of experience losses
Difference between the expected and actual return on scheme assets:
Amount (£’000) (153)
Percentage of scheme assets at 31 March 2003 (18.2%)
Experience losses of scheme liabilities:
Amount (£’000) (115)
Percentage of scheme assets at 31 March 2003 (15.9%)
Total amount recognised in statement of total recognised gains and losses:
Amount (£’000) (463)
Percentage of scheme assets at 31 March 2003 (64.1%)
If the above amounts had been recognised in the financial statements, the group’s net assets and profit and loss reserve at 31 March 2003 would
be as follows:
31 March 31 March
2003 2002
£’000 £’000
Net assets 
Net assets excluding net pension surplus/(deficit) under SSAP 24 38,239 41,157
Pension surplus/(deficit) under FRS 17 70 (169)
Net assets including net pension surplus/(deficit) under FRS 17 39,309 40,988
Reserves
Profit and loss account recognised in the financial statements (6,537) (1,568)
Pension surplus/(deficit) under FRS 17 70 (169)
Profit and loss account including net pension surplus/(deficit) under FRS 17 (6,467) (1,737)
Plasmon Plc
Annual Report 2003
Notes to the financial statements
48 Directors
John Barrie Morgans 
(Chairman)
Nigel Street
Timothy Arthur
Henri Zinsli (Switzerland)
Christopher McFadden
Secretary
Timothy Arthur
Registered No 2100291
Registered Office
Whiting Way
Melbourn
Nr Royston
Hertfordshire
SG8 6EN
Auditors
PricewaterhouseCoopers LLP
1 Embankment Place
London
WC2N 6RH
Principal Bankers
Venture Finance Plc
Sussex House
Perrymount Road
Haywards Heath
West Sussex
RH16 1DN
HSBC Bank Plc
City Office
Cambridge
CB2 3HZ
Silicon Valley Bank
4410 Araphoe Avenue
Suite 200
Boulder
CO 80303
United States of America
Solicitors
SJ Berwin
222 Grays Inn Road
London
WC1X 8HB
Financial Advisers
Investec Investment Banking
Corporate Finance Department
2 Gresham Street
London
EC2V 7QP
Stockbrokers
Investec Securities
2 Gresham Street
London
EC2V 7QP
Registrars
Capita Registrars
34 Beckenham Road
Beckenham
Kent
BR3 4TU
Shareholder helpline: 0870 162 3100
www.capitaregistrars.com Plasmon Plc
Whiting Way
Melbourn
Hertfordshire
SG8 6EN
T elephone 01763 261466
Facsimile 01763 260336
Internet: www.plasmon.co.uk
Email: sales@plasmon.co.uk
Plasmon Inc
4425 Arrowswest Drive
Colorado Springs
CO 80907-3489
USA
T elephone 001 719 593 7900
Facsimile 001 719 593 4597
Internet: www.plasmon.com
Email: sales@plasmon.com
P asmon P c Annua Report 2003