Annual Report 2003
The Vitec Group plc Annual Report 2003
The Vitec Group plc
Group head office
One Wheatfield Way
Kingston Upon Thames
Surrey KT1 2TU
United Kingdom
tel +44 (0)20 8939 4650
fax +44 (0)20 8939 4680
email info@vitecgroup.com
web www.vitecgroup.com
Registered office
Western Way
Bury St Edmunds
Suffolk IP33 3TB
United Kingdom
Registered in England 
No 227691
Cartago, Costa Rica
Cambridge Research Park, UK
Designed by Millini. Printed by Beacon Press Group directory
Main offices
Bogen Imaging
565 East Crescent Avenue
PO Box 506
Ramsey
NJ 07446-0506
USA
Tel: +1 (201) 818 9500
Fax: +1 (201) 818 9177
www.bogenimaging.us
Manfrotto
Via Sasso Rosso n19
PO Box 216
I-36061 Bassano del Grappa
Italy
Tel: +39 (0424) 555855
Fax: +39 (0424) 808999
www.manfrotto.com
Gitzo
Créteil Parc
8/10 rue Sejourné
94044 Créteil Cedex
France
Tel: +33 (1) 4 513 1860
Fax: +33 (1) 4 377 1505
www.gitzo.com
IFF
Via Vittorio Emanuele 32
I-50041 Calenzano
Firenze
Italy
Tel: +39 (055) 882 6351
Fax: +39 (055) 882 6355
www.iff.it
Litec
Via Venier 52
30020 Marcon (Ve)
Italy
Tel: +39 (041) 596 0000
Fax: +39 (041) 595 1082
www.litectruss.com
Anton/Bauer
14 Progress Drive
Shelton
CT 06484
USA
Tel: +1 (203) 929 1100
Fax: +1 (203) 925 4988
www.antonbauer.com
Radamec Broadcast Systems
Brooklands Close
Sunbury on Thames
Middlesex
TW16 7AP
UK
Tel: +44 (0)1932 766300
Fax: +44 (0)1932 766301
www.radamecbroadcast.co.uk
Clear-Com
4065 Hollis Street
Emeryville
CA 94608
USA
Tel: +1 (510) 496 6666
Fax: +1 (510) 496 6699
www.clear-com.com
Vinten Broadcast
Western Way
Bury St Edmunds
Suffolk
IP33 3TB
UK
Tel: +44 (0)1284 752121
Fax: +44 (0)1284 750560
www.vinten.com
Drake Electronics
7400 Beach Drive
Cambridge Research Park
Waterbeach
Cambridge
CB5 9TP
UK
Tel: +44 (0)1223 815000
Fax: +44 (0)1223 815001
www.drake-uk.com
Sachtler
Gutenbergstrasse 5
D-85716 Unterschleissheim
bei Munchen
Germany
Tel: +49 (89) 3215 8200
Fax: +49 (89) 3215 8227
www.sachtler.com
Audio Specialties Group / Bexel
Bexel Broadcast Services (BBS), Broadcast Video Gear (BVG), Digital Cinema Rentals (DCR), 
Intercom Specialties (ICS), Systems Wireless (SWL) 
801 South Main Street
Burbank 
CA 91506
USA
Tel: +1 (818) 841 5051
Fax: +1 (818) 841 1572
www.a-s-group.com
www.bexel.com
Photographic
Broadcast Services
Broadcast Systems
2003 has seen significant progress on our ‘Consolidate-Leverage-
Grow’ strategy. While the emphasis has been on consolidation,
the benefits of our recent investments in R&D are beginning to
come through with continuing volume growth in Photographic
and encouraging projects in Broadcast. 
Despite falling TV audience figures in the US, there are signs of
an upturn in advertising there. In addition, photographic demand
remains strong and we expect this to continue during 2004.
However, we expect currency movements to continue to have 
a negative effect on the Group.
Accounts 2003 00
Consolidated profit and loss account 40
Balance sheets 41
Consolidated statement of total recognised gains and losses 42
Reconciliation of movements in shareholders’ funds 42
Consolidated cash ﬂow statement 43
Notes to the accounts 44
Five year financial summary 71
Shareholder information and financial calendar 72
Group directory IBC
The year in review 01
At a glance 02
Chairman’s statement 06
Chief executive’s review 08
Divisional reports 00
Photographic 10
Broadcast systems 12
Broadcast services 14
Financial review 16
Board of Directors 18
Directors’ report 20
Remuneration report 23
Corporate social responsibility report 30
Corporate governance 33
Independent auditor’s report 39
Broadcast
Engineering 
magazine’s Pick
Hit Award for
Drake’s FreeSpeak
Digital TV Magazine’s
Editors’ Pick of Show
Award at NAB for
Vinten’s Fibertec
The Vidy Award
at NAB for
Vinten’s Fibertec
Government Video
Magazine’s Salute
2003 Award at NAB
for Vinten’s Fibertec
Audio Award at PLASA
for Clear-Com’s
CellCom
TV Technology
Europe’s Star Award at
IBC for Anton/Bauer’s
Stasis and for
Chromaflex (a product
distributed by Bogen)
The prestigious
Peter Wayne IABM
Award at IBC for
Technical Excellence
for Drake’s FreeSpeak
NAB Award for Innovation
in Media for ChromaFlex, 
a product distributed 
by Bogen
The prestigious
2003 Mario
Award at NAB
for Drake’s
FreeSpeak
Cover Picture Gitzo's new G1227LVL levelling tripod featuring a revolutionary centre column
angle and locking mechanism which allows for quick and accurate setup on uneven ground. Sales growth of 5.8%, both organic and 
from acquisitions
Strong volume growth in Photographic
Successful manufacturing restructuring
Increased focus on media and entertainment
markets, ALU business divested
Recommended unchanged total dividend 
for the year of 22.7p
03
02
01
00
99
192.8
182.2
190.4
200.0
171.4
Turnover £m
03
02
01
00
99
17.8
24.7
30.6
40.1
38.2
*Operating profit £m
03
02
01
00
99
23.9
42.9**
34.1
62.8
54.3
*Headline earnings per share pence
03
02
01
00
99
22.7
22.7
22.7
21.2
18.5
Dividends per share pence
* before exceptional items, goodwill amortisation and impairment.
** 2001 restated for FRS19 deferred tax standard.
Sachtler’s pantographs provide lighting 
suspension systems for every type of studio.
Shaping up Design and manufacture of
photographic and video camera
support, as well as lighting,
support and suspension
equipment, for professional
photography, video, broadcast
and cinematography. Distribution
of photographic, video and 
cine related equipment and
accessories.
Activities
Photographic
Brands Products
Photographic, video heads 
and tripods. Lighting stands,
grips, clamps and accessories.
Lighting and scenery suspension
equipment. Photographic
accessories. Live entertainment
and exhibition lighting
suspension structures.
Design and manufacture of 
high quality equipment used
principally by broadcast and 
live entertainment professionals.
Focused on studio broadcast,
outside broadcast, electronic
news gathering and electronic
film production markets with
applications in the air traffic
control and government markets.
Broadcast 
systems
Manual pedestals, tripods and
heads for TV, ENG and EFP
applications. Remote-controlled
camera systems. Studio and
portable lighting. Scenery 
hoists and pantographs. 
Microprocessor-controlled
batteries and chargers for video
cameras. Portable power systems
for life support devices. 
Multi locational intercom systems. 
Party line intercom systems.
Wireless intercom systems.
Wireless microphones.
Rental services and selected
sales of camera, video, wireless
communication and audio
equipment, including engineering
support for the film and TV
programme production markets.
Broadcast
services
Rental of broadcast video
equipment. Rental of audio
equipment. Rental of high
definition TV production
support. Provision of support
for major event broadcasting
and webcasting. Sales of
communications, audio
equipment and used video
equipment.
02 The Vitec Group
At a glance The Vitec Group supplies a wide range of
equipment and services to the broadcasting, entertainment
and photographic industries.
With products distributed in nearly 100 countries, over 94%
of sales are outside of the UK, with 54% in the Americas.
sachtler Locations
Annual Report 2003 03
France
Germany
Italy
USA
Vitec Group products are 
sold worldwide, while 
the Broadcast Services
division primarily operates
in the United States. 
China
Costa Rica
France
Germany
Japan
The Netherlands
Singapore
UK
USA
USA
Vitec’s Global Markets 04 The Vitec Group Annual Report 2003 05
Vitec Group products are used by frontline professionals – for
news gathering and documentary making, as well as in outside
broadcast, live entertainment or sophisticated studio operations. Chairman’s statement
2003 saw progress on a number of fronts as we continued to
reshape the business and position it for future growth.
2003 saw progress on a number of fronts as we continued to reshape the
business and position it for future growth. Our Broadcast manufacturing
facilities have been restructured and substantial progress made on
worldwide IT systems. We continued to launch attractive new products
and our recent acquisitions have been integrated. However, the results
were affected by a combination of overall weakness in our broadcast
markets and by adverse currency effects.
Year on year revenues grew for the first time since 2000 (from £182.2
million in 2002 to £192.8 million in 2003) due to new products and 
the effect of several small acquisitions. However, operating profit before
exceptional items, goodwill amortisation and impairment fell (from
£24.7 million to £17.8 million) due to changing product mix, adverse
exchange rates, the costs of increased product development activities
and the inefficiencies associated with the series of plant closures
undertaken in 2003.
Earnings per share, before exceptional items, goodwill amortisation and
impairment, were 23.9p (2002: 34.1p) reflecting the factors above and
the continuing high tax rate, which arises because most of the Group’s
profits are earned outside of the UK.
Cash generation remained strong, with net cash inflow from operating
activities at £28.7 million (2002: £35.4 million) being 161% of operating
profit before exceptional items, goodwill amortisation and impairment
(2002: 143%).
Market overview The market remained strong for Vitec’s Photographic
brands, particularly in the US. However the demand for our Broadcast
Systems products and for Broadcast Services rental service did not
recover. After an encouraging first three months in 2003, the Gulf War
and a slowdown in Asia depressed sales through most of the rest of 
the year. 
Weakness in broadcast markets was offset by success in other discrete
areas, such as live entertainment and military and government. A pick-
up was noticeable towards the end of the year, particularly in the
robotic camera support area, but I am cautious about drawing any 
06 The Vitec Group
firm conclusions from such limited evidence. The broadcast rental
market in the US stayed subdued for most of the year, and 2003 did
not benefit from the major sports event contracts of 2002.
In contrast, I am delighted to report that our Photographic business
enjoyed strong sales to the keen amateur segment, whilst sales to
professional photographers were relatively stable. Volume was up
significantly on the previous year, driven by new products targeted at
capturing the growth in digital still and video imaging but with much of
the volume going to the US, these volume gains were largely negated
by the impact of the falling dollar.
Acquisitions and Disposals In February 2003, Vitec acquired
OConnor Engineering, a leader in camera control heads for the film
industry, and Radamec Broadcast Systems, a leader in automated
robotic control systems. These businesses have been successfully
integrated, with OConnor products now available worldwide through the
Sachtler sales channel. Radamec Broadcast production was transferred
to Vinten in Bury St Edmunds. Radamec Broadcast enjoyed a particularly
strong end to the year. Aspen, which was integrated into Anton/Bauer
in 2002, generated sales growth of over 80% in 2003. 
In January 2004 we announced the acquisition of Manfrotto’s long-
standing German distributor for b1.9 million. It, together with our
existing trading companies in France, Italy and the US, will be renamed
Bogen Imaging, establishing a better marketing platform to support our
worldwide photographic dealers. 
At the end of the year Vitec broke off discussions with EVS Broadcast
Systems regarding the potential acquisition of that business. Due
diligence and other costs of £0.9 million were written-off as an
exceptional item.
In December we announced the sale of the Retail Display business,
ALU, for £11.9m. Whilst revenue grew to £22.4 million during the 
year, profitability was affected by a charge of b3.0 million (£2.1 million)
for upgrading retail units. ALU initially developed its business by
successfully selling variants of existing Manfrotto products to clothing Whilst the Group’s strategy is to enhance shareholder value by pursuing
growth, whether organically or by acquisition, the Board recognises that
if no suitable opportunities present themselves over the medium-term it
will consider how best to return cash to shareholders.
Outlook 2003 was a year of considerable change for Vitec and we
expect 2004 to benefit from the plant consolidation programme, largely
completed last year, and from the new products launched recently. 
Our photographic market remains strong and continues to benefit 
from the uptake of digital cameras, however the broadcast market
remains difficult. TV advertising in the US is now more buoyant than 
at any time during 2003, which should help our customers’ confidence,
although disappointing audience figures may continue to make
advertisers cautious.
With half of Vitec’s sales coming from the US, the present weakness 
of the dollar will have a negative effect on Vitec during 2004. Based 
on the euro, dollar and yen exchange rates governing at close of
business on 26 February continuing throughout 2004, there would 
be an adverse transaction effect of some £2.4 million and an adverse
translation effect of some £1.7 million, compared to 2003.
Alison Carnwath 
Chairman
Annual Report 2003 07
retailers. That overlap in product ranges is no longer so significant and
the business was identified as non-core. I would like to thank Abramo
Manfrotto, who has left with ALU, for his work at Vitec; sales by the
Manfrotto business doubled in the years of his leadership.
Changes to the Board The Board has been strengthened by the
appointment of Nigel Moore from 1 March 2004. Nigel spent most 
of his career at Ernst & Young and it is intended he will take over the
Chairmanship of the Audit Committee in September. I am delighted 
to welcome him to the Board.
I have now served on the Board for eight years, with five of them as
Chairman. It is therefore time to start planning for a successor. In order to
allow for an appropriate handover period, we are currently undertaking
a search process with a view to making an appointment during 2004.
I would like to thank all our employees worldwide, and my colleagues on
the Board, for the dedication and skill they have shown during the year,
one in which Vitec has made many steps forward in a difficult market.
2003 dividend and dividend policy The Board is recommending an
unchanged final dividend for the year of 16.6p, giving a total dividend
for the year of 22.7p.
The emphasis within the ‘Consolidate-Leverage-Grow’ strategy has so
far been on consolidation and restructuring of the Group’s activities; as
the balance changes towards growth the Board believes it is important
to ensure the company has the flexibility to pursue acquisitions.
Accordingly the Board has decided to adjust its dividend policy to move,
over a period of two to three years, towards an average dividend cover
level of around 2 times.
Subject to there being no material adverse factors that may affect the
Group’s results in 2004, the Board intends to maintain the interim
dividend for the financial year to December 2004 at 6.1p. The final
dividend for that year will be set taking into account the policy outlined
above and the outlook for 2005.
Clear-Com's Eclipse digital matrix intercom system is a leap forward in
communications technology, blending the field-proven suite of Matrix
Plus features with simple programming and a powerful new processing
platform with dual redundant power supplies. An individual matrix can
support up to 208 users. Chief executive’s review
2003 proved to be a challenging year, but one in
which Vitec made significant steps forward on its
‘Consolidate-Leverage-Grow’ strategy.
to concentrate Bury St Edmunds on the more complex Broadcast
products, with Cartago concentrating on higher volume lines. In 
Italy we have re-organised a number of manufacturing facilities and
processes. Further simplification will be possible following the sale
of ALU, allowing us to run the core facilities there more effectively.
In addition, the entire Drake business also relocated from Welwyn
Garden City to a better-suited site on the Research Park outside
Cambridge, UK.
During the year the Photographic business rolled out a new integrated
IT system to most of its main locations and the Broadcast Systems
IT system was extended to the Cartago site and the Radamec
Broadcast and Vinten Inc sales offices. These systems will greatly
improve the information available to managers, and speed up
decision-making and production planning. The integrated IT system
within Broadcast Services is allowing them to better manage their
rental assets, reducing the need for capital and giving better control
over subrentals.
Taken together, the plant reorganisation and the IT implementations
have inevitably been disruptive. These initiatives have been well
managed and provide the cornerstones for Vitec’s future.
Top line growth generated Whilst the emphasis was on ‘Consolidate
-Leverage’ during 2003, considerable progress was also made in
resuming top line growth. Despite a difficult market, revenue from
continuing operations grew 3.6% during 2003: Broadcast Services
was lower due to the non-repeat nature of the 2002 FIFA World
Cup, but this was more than offset by increases in the other Divisions.
08 The Vitec Group
As underscored in our Half Year Results statement, 2003 proved to
be a challenging year, but one in which Vitec made significant steps
forward on its ‘Consolidate-Leverage-Grow’ strategy.
This strategy involves taking out costs by exploiting our scale, improving
our performance through better use of group-wide manufacturing
and IT systems, and looking to generate growth by focusing our
engineering and marketing resources on those areas where growth
can be achieved. Solid progress has been made on all these fronts,
although there is more to do.
Whilst we expect to show organic growth through the new product
platforms and the improved distribution network, there remains an
avenue for growth through acquisition in what is still a fragmented
industry. With significant progress in manufacturing, division-wide 
IT systems and a management team focused on delivering growth,
Vitec is now able to add value to acquired businesses in a way that
it could not in the past.
Manufacturing restructuring delivered With our markets well below
the peak of 2000, and with lower demand for the more complex
studio infrastructure products, the high operational gearing within
our Broadcast businesses was a handicap. The focus in 2003 was,
therefore, on ‘Consolidate-Leverage’. Lower cost manufacturing is
vital to counter the effects of the ongoing trend to smaller cameras
and tripods within the lightweight sector of the broadcast market. 
To drive manufacturing efficiencies we closed four plants and
upgraded the facilities in Bury St Edmunds, UK and Cartago, Costa
Rica (located in a local Zona Franca). We have taken the opportunity Photographic sales were up on the back of some successful product
launches at the end of 2002 and throughout 2003, and Retail
Display benefited from a large US order, albeit at lower margins than
in the past. The lighting truss business, Litec, has seen growth from
the adoption of its new temporary lighting gantry and roofing products.
Bogen, the distribution arm, went from strength to strength in the
US, with a number of exciting new lines, including Kata camera bags.
In Broadcast Systems, while the net growth came from the acquisitions,
there was increased volume in lightweight camera support and useful
sales increases at Anton/Bauer and Clear-Com, both US-based, and
at Sachtler.
It was very pleasing that Vitec companies continued to pick up
awards for innovative new products at the major tradeshows: Drake,
Clear-Com, Vinten, Anton/Bauer and Bogen were all recognised 
for their technical leadership during 2003. These awards are not
ends in themselves, but are encouraging pointers to future revenues
as and when broadcast budgets revive. Drake was also successful 
in securing a number of significant intercoms orders for Air Traffic
Control projects. The first of these was delivered in late 2003, and
will be commissioned in early 2004, and we are learning more about
the market from each one. As we won more orders than expected,
R&D expense was increased to take advantage of these opportunities.
09
Bexel rents out complete HD systems for
prime time sitcoms, movies, commercials
and other "film-style" productions. 
This HD camera is powered by an
Anton/Bauer battery and controlled using 
an OConnor head - both Group products.
At the end of 2003 we opened a sales office for the Broadcast
companies in Beijing to serve the local Chinese TV stations as they
prepare for the Olympics in 2008.
The growth in high definition programming has been exploited by
Bexel, who have provided equipment and technical support for
several new TV shows.
Executive team The Executive Board has been joined by Joop
Janssen and Francesco Bernardi. Joop, who took over the Broadcast
Systems Division in June 2003, has spent most of his career in
broadcast at Thompson and Philips in product development and
business management roles. Following the sale of ALU, Francesco
Bernardi was promoted to lead Gruppo Manfrotto, having been its
Sales and Marketing Director. His background is in international
marketing. Photographic Products for 
professional photographers
10 The Vitec Group
Photographic continues to make good progress The Photographic
Division’s best performing market in 2003 has been the US where
Bogen achieved record sales. Europe did not match this performance
and declines were registered in the key markets of Italy, France and
Germany while many emerging countries in Asia struggled to recover
from the SARS epidemic.
The new distribution strategy initiated last year led to the acquisition
of the distribution end of Germany’s Multiblitz, which will become part
of Bogen Imaging, and the appointment of Daymen International in
the UK.
2003 was another record year for Litec, which produced the highest
growth in the Photographic Division, and Gitzo, which saw a double
digit volume growth.
The cinema sector grew considerably this year, with Manfrotto and
Avenger Lighting Supports products widely used throughout the film
industry, notably in the production of blockbuster films such as Lord
of the Rings, Peter Pan, Matrix Reloaded and Matrix Revolutions.
Marketing activities 2003 was a busy year for Manfrotto in terms of
sponsorships and collaborations such as Land Of Africa, a humanitarian
expedition from Switzerland to the Cape of Good Hope; the Toscana
Photographic Workshop which ran photographic courses across Italy
in which acclaimed photographers (including National Geographic
and Magnum members) taught young and aspiring photographers
how to get the most from their art; an Italian speleology expedition to
Cuba; and "Den Första Svenska Dhaulagiri Expeditionen", the first
Swedish expedition to the 8000m "White Mountain" in the Himalayas
(the same expedition team then set out for the South Pole armed with
Manfrotto photo and video equipment); and sponsorship of French
aerial photographer Yann Arthus Bertrand.
New products In 2003, Manfrotto launched a broad range of new
products in both the video and photographic sectors including the
innovative, easy-to-use and ergonomic grip action ball photographic
head; the extended "DIGI" compact tripod range, which attacks the
amateur end of the market; the spherical panoramic head which
generated a considerable amount of interest with the more specialised
virtual reality end of the market and three new video camera remote
pan bars for all types of user.
Gitzo introduced a selection of new products specifically targeted at
the photographic market’s growing trend for miniaturisation within the
digital camera market, and levelling tripods aimed at flexible outdoor
applications for nature and architecture photographers. 
IFF launched the Line Shaft Hoist in 2003 aimed at the theatrical market.
Litec developed a smaller compact truss that works in combination
with its revolutionary Libera system to create broad span structures
and grid systems guaranteeing high load capacities with minimal
column support. 2003 also saw the introduction of convenient truss
transportation systems and the restyling of important existing products.
Other activities IFF was transferred from Florence to premises in
Feltre, the heart of Gruppo Manfrotto’s manufacturing area, and a
number of the assembly factories were transformed into flow lines.
The year ended with good order intake, resulting in a significant 
order book as the business enters 2004.
The new Divisional IT system, Movex, was fully rolled out in the US
and in the manufacturing sites in Italy, representing a step change 
in the way the business is managed, with one system replacing six
standalone systems.
Retail Display continued to develop in a difficult market, and has
now been sold In 2003 the retail display market continued to be soft,
particularly in the US, where the total fixture industry shrank 6.5%
between 2001 and 2003 and the first half of the year saw ten fixture
companies go bankrupt or close factories. Although big box retailers
took more share away from ALU’s traditional customer base (specialty
retailers and department stores), the Company was able to finally
reverse a four year decline in the US market. 
In Europe, modest improvements in key markets like Germany, the
UK and Scandinavia were negatively offset by the slowdown with a
major custom project, which had reached its peak in 2002 and is
now phasing out. Whilst distribution in the Asia Pacific region is still
weak, ALU won a very prestigious international program with a Hong
Kong based cosmetic company. 
New products launched (a completely new Autocube system and a
renovated version of Box in December of 2002, and a new rail system
called Acrobat in March of 2003) received very strong market response.
Autopole, the traditional product, still performed very well in 2003,
thanks to a particularly large order from Sears.
At the end of the year the disposal of the ALU business for £11.9
million was announced. Manfrotto will continue to provide administration
and IT services to ALU on an arm’s length basis, and a supply
contract, principally for Autopole products, is also in place. I would
like to thank all of the staff at ALU for their work for Vitec, and wish
them well for the future.
One of Gitzo’s
Mountaineer tripods
performing well in
extreme circumstances.
2003 2002
Turnover
†
£83.9m £77.0m
Photographic £61.5m £59.2m
Retail Display
***
£22.4m £17.8m
Operating profit
†
**
£13.9m £15.4m
Photographic £13.9m £14.2m
Retail Display
***
£0.0m £1.2m
Operating margin
†
16.6% 20.0%
Photographic 22.6% 23.9%
Retail Display
***
0.0% 6.7%
†
for the Photographic and Retail Display Division
** before exceptional items of £nil (2002: £0.8 million) 
and goodwill amortisation of £0.1 million (2002: £0.1 million).
*** discontinued operation
Bogen Imaging Inc is the exclusive US
distributor of Kata photographic bags. 11
The "professionals' choice", 
Gitzo provides the benchmark 
for professional photographic
tripods and heads. 2003 2002
Turnover £81.9m £75.5m
Operating profit
*
£3.9m £8.4m
Operating margin 4.8% 11.1%
*
before exceptional items of £1.9 million (2002: £5.0 million) 
and goodwill amortisation of £0.7 million (2002: £0.4 million).
12
Broadcast systems Products and systems
primarily for broadcast applications
Vinten's Pro Touch Pro-6 camera
support system provides smooth
control and movement through
360º of pan and +90º to -60º of
tilt with continuously variable fluid
drag. An illuminated level bubble
is provided for convenient set up 
in low-light situations.
With a choice of three matrix frame sizes,
the capability to support up to 3,000 users
and a wide selection of user panels and
interfaces, Drake’s 4000 Series II system
is the choice of broadcast professionals 
all over the world. Camera cranes are increasingly used to
achieve extraordinary camera positioning.
Although long established in the film
industry, they are now being adopted by
the world of television. That’s why
Sachtler’s new CamCrane EFP is specially
designed to meet field production needs.
Annual Report 2003 13
Product introductions have maintained revenue in a weak market
The two acquisitions in February broadened the product range; 
cost reduction initiatives continued in a tough broadcast market.
The consolidation of manufacturing started to enhance profitability
in the camera support product lines for Vinten and Sachtler in the
fourth quarter.
Vinten continues to lead the industry in the design and supply of
Studio and Outside broadcast products. 2003 saw a number of
substantial deliveries including Televisa's Chapultepec Newscenter
studios which selected a number of camera support systems for its
studio, including Quartz pedestals complete with Vector 70 pan and
tilt heads. A major station in Austria took delivery of a number of
robotic heads and control systems, as well as manual heads and
pedestals, whilst a television station in Durham North Carolina
purchased a complete robotic camera automation system including
three SP-2000XY full servo pedestals. A number of systems were
also installed in food and shopping channels throughout the US.
Vinten equipment was also hired or purchased for a variety of major
events around the world such as the Golf Masters, Downhill skiing,
and extreme winter sports events in the US.
Vinten and Radamec Broadcast – the two leading Robotic camera
control suppliers - joined forces to develop the broadcast robotics
business, creating synergy between the two operations. The main
focus was on manufacturing and product development to produce
the best products at the highest quality level for the future. New
products include the Series 200 controller and the exciting SE-500
Servo Elevation Unit, a remote controlled height positioning unit.
Both products were designed to meet the diverse requirements of
robotics in today's demanding TV environment. This year also saw
the launch of the Scenario XR – a virtual television production
system in which the virtual and real video world can be mixed
seamlessly in real time.
Manual products continued to satisfy evolving market demands, 
not least the Pro-touch lightweight range now including the Pro-6
and Pro-10 systems. These provide both outstanding rigidity and
exceptional control for the latest range of professional DV camcorders.
Vinten received a number of awards from trade magazines for
exceptional product design at the NAB convention and the yearly
Beijing broadcast show.
In 2003, alongside the cost reduction programme, Sachtler refocused
its sales and innovation resources to satisfy increasing customer
demands, with the OConnor acquisition offering an additional product
range and new product development skills.
The product range was widened by the 75 kg fluid head, with video
and film versions, and the 13 kg ENG head (Video 15) to serve lower
camera weight demands. Furthermore, a low cost version of a fluid
head for mini DV-cameras was introduced, also incorporating the
famous Sachtler fluid system.
Sachtler’s largest sales during 2003 were 100 sets of ENG-systems
for Spanish TV, the complete ENG project for the African games, a
studio lighting system contract in Japan won against local competitors,
and other important studio lighting systems for Swiss and Austrian TV.
Sachtler broadened its customer base, especially in the US, where 
a considerable volume of products were sold in non-broadcast
applications.
Anton/Bauer recorded its second highest sales year in 2003. It is
building its worldwide market share, with significant progress being
made in Europe, supported by the expansion of its regional sales
and service office in the Netherlands.
Anton/Bauer continued its record of product innovation, winning
industry awards and customer praise with the introduction of the
STASIS power support system. This unique patented design combines
both power and stable operation for small handheld mini-DV
camcorder equipment. 
The Aspen product line, acquired in 2002, was improved with the
introduction of the Nexus battery system; this offers an innovative
perpetual power feature for portable cameras. Aspen continues to
be key to addressing the growing market segment of wedding and
event videography.
Anton/Bauer also launched its Custom Power Systems (CPS)
initiative in 2003 to leverage its battery and charging technology in
other markets. The Company designed and manufactured a new
power system for a leading wireless medical cart manufacturer, in
addition to its longstanding business with a leading manufacturer 
of heart assist systems. 
Clear-Com and Drake During 2003 both Clear-Com and Drake
continued their high level of investment in R&D. Despite the sales
growth since 2002, the benefits of the past years investment are 
not expected to be visible until later in 2004. The broadcast market
remained weak, particularly in Europe, where both companies
experienced low levels of market activity. In the US, Clear-Com
benefited from a strong live performance market and the Company
maintained its position as the leading supplier of intercoms to 
this market.
During the year Drake won a significant number of orders from the
air traffic control (ATC) authorities in China, Korea, Vietnam and
Africa for voice communications systems. Delivery of these systems
commenced in late 2003, with commissioning of the first of them 
in early 2004.
Clear-Com received a PLASA award in November for CellCom, a
unique patent pending digital wireless intercom. It also launched 
the ECLIPSE digital matrix, which establishes new standards in
performance and functionality.
Customer support received a substantial boost in 2003 with the
establishment of a ‘24x7’ user support centre. The centre has been
introduced to provide immediate response to customers in every
time zone; it provides technical advice and assistance with trouble-
shooting, web based ordering and tracking of repairs and bespoke
care plans for special cases.
Anton/Bauer’s Stasis provides 
support for lightweight video 
cameras. The balancing 
counterweight, an Anton/Bauer
battery, powers both the camera
and the Anton/Bauer light. Broadcast services Rental services and technical
support mainly for the broadcast market
2003 2002
Turnover £27.0m £29.5m
Operating profit
*
£0.0m £0.9m
Operating margin 0.0% 3.1%
*before goodwill amortisation of £0.5 million (2002: £0.4 million) 
and impairment of goodwill of £2.1 million (2002: £nil)
14 The Vitec Group
Bexel’s expertise at putting together complex equipment packages for high
profile events has made them the leading rental company in the US. Annual Report 2003 15
Bexel editing suites have facilitated the smooth production
of the last 10 Super Bowls.
Focus on control of rental assets has generated cash in a difficult
market Although Broadcast Services benefited from a continued
upturn in market demand for several types of large scale and High
Definition productions in 2003, it was impacted by generally weak
ongoing trading conditions in the US broadcast industry. As a result,
and without the recurrence of 2002’s large Winter Olympic and World
Cup contracts, the Division’s turnover fell by 8%, and operating
profit before exceptional items, goodwill amortisation and impairment
charges dropped to break-even. 
Capital expenditures, however, were tightly constrained, bringing 
the Division’s pool of equipment much more in line with demand.
Broadcast Services made increasing use of its integrated asset
management system in 2003, which allowed for improved equipment
utilisation and optimal usage of rentals from third parties. This
discipline, coupled with tighter controls over working capital, enabled
the Division to boost its operating cash flow to US$7.0 million in 2003.
A more proactive sales effort, greater sales force training and a new
customer relationship management system helped produce volume
increases in several areas, despite the weak overall market demand.
The Division built customised High Definition (HD) portable broadcast
equipment modules in ‘road-ready’ travel cases, and designed
innovative audio and video production packages, to enhance its
position in the rapidly growing HD broadcast market. 
The Bexel brand’s fibre-optic-based studio HD systems captured four
prime-time series: Grounded for Life, which aired on the Warner
Brothers Network, Hope and Faith on ABC, and The Tracy Morgan
Show and Whoopi on NBC.
Bexel’s nationwide network of offices allowed it to support long-term
travelling series, such as The Jamie Kennedy Experiment for Tribune
Entertainment. The Division also supported major North Atlantic
Treaty Organisation and World Trade Organisation events with large
custom-built audio/video systems. The nationwide network was also
invaluable support for sporting event producers such as Turner
Broadcasting, which used Bexel equipment packages to broadcast 
a selection of the week’s best National Basketball Association games
in many different cities. 
Bexel’s BBS unit supported the broadcasts of many world-class
sporting events, including: The Super Bowl; the Kentucky Derby,
Preakness and Belmont Stakes "triple crown" of US horse racing;
the FIFA Women’s World Championship; the US Open Tennis and
Golf Championships; and HD broadcasts of premier National
Football League and Major League Baseball games. 
The Division also made significant inroads in the vibrant reality
television sector. By combining its comprehensive inventory of audio
and video equipment with expert product design and technical
advice in both disciplines, the Division won several hit shows from
entrenched competitors. Broadcast Services thus became the 
"one-stop" first choice for the producers of MTV’s The Osbournes
and Newlyweds, CBS’ Survivor, NBC’s The Apprentice (starring
Donald Trump), and Fox’s Paradise Hotel, Casino and Forever Eden.
The Division’s sales units also scored major successes. Audio
Specialties Group (ASG) was awarded a three-year contract to 
be the exclusive US distributor of innovative Radio Frequency
products for HME, a leading broadcast audio manufacturer. ASG
also introduced Drake’s Digital Matrix Intercom System products 
to the US market. Bexel’s Broadcast Video Gear unit increased its
presence in the US used equipment sales arena and outperformed
most of its competitors, especially late in the year, when it set all-
time records for sales volume despite a generally adverse market.
Gareth Rhys Williams 
Chief Executive Continuing operations Turnover increased by £6.0 million (from
£164.4 million to £170.4 million) or 3.6% in the year. Most of the
underlying growth occurred in the Photographic Division. The 
broadcast and media industries remained depressed for most of 
the year, but Broadcast Systems benefited from a contribution of
£5.9 million arising from the acquisition of Radamec Broadcast
Systems and OConnor Engineering. Excluding acquisitions, sales
growth was £4.8 million or 2.9%, but this was negated by the
adverse effects of FX rates on translation, £1.2 million, and
transaction £3.5 million. 
Gross profit margins fell from 46.0% to 43.6% reflecting a poorer
mix in a number of businesses and the adverse effect of FX
transactions, particularly in the Photographic Division. Gross profits
were £3.6 million lower than the prior year before a contribution of
£2.2 million from acquisitions.
Net operating expenses before exceptional items of £1.9 million
and goodwill amortisation and impairment charges of £3.4 million
increased by £4.4 million to £56.6 million (£63.6 million in total,
less £7.0 million for discontinued operations). £2.5 million of the
increase related to acquired businesses. £1.2 million was due to an
18% increase in research, development and engineering costs and
£2.0 million to increased investment in sales and marketing costs,
offset by a £1.3 million benefit from foreign exchange translation. 
Operating profits on continuing business before exceptional items
and goodwill amortisation and impairment charges fell from £23.5
million to £17.8 million and operating profit margins were 10.4%
compared to 14.3% in 2002. The year on year effect of translating
overseas profits was £1.2 million favourable and the effect of
exchange rate changes on transactions, principally the weaker dollar
against the euro, was £2.3 million unfavourable after hedging.
As previously announced, the Group has taken operating 
exceptional charges of £1.9 million, comprising £1.0 million for the
closure of Radamec Broadcast’s manufacturing facility at Chertsey
and £0.9 million costs relating to the unsuccessful acquisition of
EVS Broadcast Equipment.
Discontinued operation and related exceptional item The sale 
of the Retail Display business on 30 December 2003, resulted 
in a loss on disposal, before tax, of £3.0 million after £1.0 million 
of divestment costs. The loss was after charging goodwill of £2.4
million, including £2.1 million previously written off to reserves.
There was an associated tax credit of £4.1 million, which will
significantly reduce the tax payable in Italy in 2004.
In the year to December, Retail Display’s net turnover increased 
by 25.8% to £22.4 million (2002: £17.8 million), due principally, to
a pick up in the US market, including a $7.3 million (£4.5 million)
order from Sears. Operating profit was £nil (2002: £1.2 million) 
as a total of b3.0 million (£2.1 million) had to be provided for the
upgrade of retail units, an increase of b1.5 million (£1.0 million)
over the amount announced and charged at the half year.
Goodwill amortisation and impairment The charge for goodwill
amortisation and impairment was £3.4 million (2002: £0.9 million).
This included £0.3 million attributable to 2003 acquisitions and 
an impairment charge of £2.1 million against the goodwill on the 
US Systems Wireless business.
Taxation The effective taxation rate on operating profit before
exceptional items, goodwill amortisation and impairment has
increased to 39.8% from 39.4% in 2002. The tax charge is 
relatively high because profits have arisen in high tax jurisdictions
but the Group has incurred net losses in the UK on which it has not
benefited from tax relief. In 2003, £0.3 million of the £6.4 million
tax charge on ordinary activities represents deferred tax and is,
therefore, a non-cash charge. 
Cash flow and net debt Cash generation remained good despite the
lower profits. Net debt decreased during the year by £1.5 million to
£10.4 million as the cost of the two acquisitions (£6.4 million) and
the cash costs of restructuring actions were more than offset 
by the sale of the Alu business (net cash effect £8.0 million).
Financial review
Turnover from continuing operations increased by £6.0 million
(from £164.4 million to £170.4 million) or 3.6% in the year.
16 The Vitec Group Net cash inflow from operating activities was £28.7 million (2002:
£35.4 million), equating to 70p per share (2002: 86p per share).
Cash flow from a reduction in working capital was £4.0 million
(2002: £0.6 million). Capital expenditure and financial investments
were £10.2 million (2002: £10.5 million), of which £2.8 million
related to rental assets and £1.1 million to IT projects, partly
financed by the proceeds from asset disposals of £2.4 million
(2002: £3.9 million).
Working capital was increased by the effect of the two acquisitions
but reduced by the divestment of the Retail Display business.
Stocks increased by £2.7 million to £33.2 million, due principally 
to acquisitions and stock build associated with restructuring. Stock
days increased to 126 (2002: 112) partly as a result of the disposal
of the Retail Display business with its higher stock turn. Trade
debtors were £0.3 million lower than last year with debtor days at 
60 days (2002: 57 days). However, trade creditors at £15.0 million
were £2.9 million higher than last year, largely reflecting the
increased level of activity.
Tax paid in 2003 was £10.8 million, £4.2 million more than 2002,
as 2003 included settlement of an historic tax claim of £1.4 million,
whereas 2002 included the benefit of two tax rebates totalling some
£2.4 million.
Treasury Policy Financing, currency hedging and tax planning are
managed centrally. Hedging activities are designed to protect profits,
not to speculate. Substantial changes to the financial structure of
the Group or treasury practice are referred to the Board. During the
year, the Board approved the use of option contracts for hedging
foreign currency receipts.
As in previous years, a portion of the transactions of subsidiaries 
in foreign currencies is hedged 12 months forward. Forward foreign
exchange contracts at 31 December 2003 totalled £16.0 million
(2002: £27.0 million), after some £3.0 million worth were 
transferred with the divestment of Retail Display. In addition, the
Group had simple option contracts, for the sale of dollars for euros
over the period August 2004 to June 2005 totalling £8.4 million.
Translation of foreign currency profits and interest rates are not
normally hedged. Foreign currency net assets are not hedged 
other than by normal Group borrowings. 
The Group operates strict controls over all treasury transactions
involving dual signatures and appropriate authorisation limits. 
Financing Activities The average cost of borrowing for the year 
was 4.8% (2002: 5.2%). Net interest cover (using profit before
exceptional items, goodwill amortisation and impairment) remained
high at 10 times (2002: 15 times) despite the lower profits. 
The Group’s three-year committed facilities expire in October 2005. 
UK pensions The Group contributes to two UK defined-benefit 
pension schemes. At the end of the year the Group closed both
schemes to new members, replacing them for 2004 onwards with 
a Group personal pension plan with Standard Life. As set out last
year, based on an estimated funding deficit of £2.7 million as at
December 2002, the Group increased its contributions to the
schemes by £125,000 per annum in 2003 (some 20%). It is
believed that this action, along with an improvement in financial
conditions, will mitigate the shortfall over a number of years. 
A full triennial actuarial valuation is due as at 5 April 2004.
International Financial Reporting Standards The Group has 
carried out a preliminary review of the implications of the proposed
international accounting standards that will come into force in 2005,
but has not yet evaluated the likely financial effect.
Alastair Hewgill 
Finance Director
Annual Report 2003 17
Intercoms users have to reconfigure their systems
as production needs change. Drake’s intuitive
new web-based software gives them this flexibility
as well as remote diognostics. Board of directors 
Alison Carnwath BA ACA
Chairman, non-executive, independent,
British, aged 51, appointed to the Board 
on 22 January 1996; member of the Audit
committee, the Nominations committee and
the Remuneration committee. Currently a 
non-executive director of Gallaher Group plc,
Friends Provident plc, Man Group plc and
Glas Cymru Cyf.
Gareth Rhys Williams BSc MBA
Chief executive, British, aged 42, appointed to
the Board on 23 November 2001. Previously
Regional Managing Director, Central Europe, 
of BPB plc. Prior to this he held senior
management positions with Rexam plc,
responsible for their European film coating
business, and for NFI Electronics. Following
initial training in IT at STC, he joined Lucas 
in a production management role before 
doing his MBA at INSEAD. He is a chartered
mechanical and electrical engineer.
Alastair Hewgill BSc ACMA
Finance director, British, aged 49, appointed
to the Board on 14 May 2002. Previously he
held senior finance positions within GKN plc
over a period of 11 years, including Finance
director of GKN Aerospace Division and Head
of Corporate Finance for the group.
18 The Vitec Group
Manfrotto's 542ART Roadrunner is the fastest pro video
tripod available today. It can be opened or closed in under
4 seconds, thanks to its innovative engineering. David Bell MA
Non-executive, independent, British, aged 57,
appointed to the Board on 12 March 1997; the
senior independent director; member of the
Audit committee, the Nominations committee
and Chairman of the Remuneration committee.
Currently, Chairman of the Financial Times
Group, a director of Pearson plc, non-executive
Chairman of the Windmill Partnership, Chairman
of Common Purpose Europe and Chairman of
Crisis, a charity for the homeless.
John Potter CEng MIEE AMBIM
Non-executive, independent, British, aged 60,
appointed to the Board on 1 February 1999;
Chairman of the Audit committee and member
of the Nominations committee and the
Remuneration committee. Formerly a director
of the TI Group plc until his retirement at the
end of 1998. Currently President and Chief
executive officer of Oxford Automotive, Inc.
Will Wyatt CBE BA
Non-executive, independent, British, aged 
62, appointed to the Board on 10 June 2002;
member of the Audit committee and Chairman of
the Nominations committee. Currently Chairman
of Human Capital Limited, President of the Royal
Television Society, Chairman of the London
Institute, and Governor of Magdalen College
School, Oxford. Formerly Chief Executive, BBC
Broadcast. Other posts within the BBC included
Managing Director of Network Television.
Nigel Moore FCA
Non-executive,independent,British,aged 59,
appointed to the Board on 1 March 2004;
Member of the Audit committee. Until recently,
a London based partner of Ernst & Young 
for many years. Currently Chairman of TEG
Environmental plc and a Trustee of the 
Butten Trust. 
Annual Report 2003 19 Directors’ report
20 The Vitec Group
The directors present their report and the audited accounts of the
Group for the year ended 31 December 2003.
Review of the Group and its activities
The performance and activities of the Group during the year are set
out in the Chairman's statement, the Chief executive's review, the
Financial review and the Group overview.
On 6 February 2003 the Group acquired the business of OConnor
Engineering Laboratories from Autocue Inc for US$2.7 million (£1.6
million) cash.
On 18 February 2003 the Group acquired the shares of Radamec
Broadcast Systems Limited in the UK, and acquired the operating
assets and some of the liabilities of Radamec Inc in the USA, from
Radamec Group PLC for £4.8 million in cash.
On 30 December 2003 the Group disposed of its retail display
business operating under the ALU name for a consideration of
£10.2 million and acquired that part of a property in Bassano del
Grappa, Italy that it did not own for a consideration of £0.55 million
plus any attributable Italian VAT.
Results and dividends
The Group’s profit on ordinary activities before tax, exceptional
items, goodwill amortisation and impairment amounted to £16.1
million (2002: £23.1 million). Profit on ordinary activities before tax
but after exceptional items, goodwill amortisation and impairment
amounted to £7.8 million (2002: £16.6 million).
The directors recommend a final dividend of 16.6p per share (2002:
16.6p). If approved, the dividend per share for the year will total
22.7p (2002: 22.7p). Subject to approval by shareholders, the final
dividend will be paid on 20 May 2004 to shareholders on the
register on 23 April 2004.
Post balance sheet events
On 8 January 2004 the Group acquired the assets of the domestic
distribution arm of Multiblitz for b1.9 million (£1.3 million) cash.
Multiblitz is one of Manfrotto’s longstanding distributors.
Future development
The Group's continuing strategy is to grow its businesses through
organic expansion and carefully planned acquisitions principally in
areas related to its existing businesses, customers, markets and
skills. 
Research, development and engineering
The management of the Group recognises that new products are
essential to its long-term success and considerable emphasis is
placed on active product development programmes in the
manufacturing companies. In 2003 those companies spent £8.8
million (2002: £7.5 million) on research, development and
engineering.
Share capital
Details of shares issued during the year are set out in note 22 to the
accounts on page 64. An analysis of shareholdings is shown on
page 72. The middle market price of a share of the Company on 31
December 2003, the last day of dealing in 2003, together with the
range during the year, is also shown on page 72.
Substantial shareholdings
As at 29 February 2004, the Company had been notified of the
following interests of 3% or more of its issued share capital:
Number of
shares %
Baring Trustees (Guernsey) Ltd 2,698,374 6.58
Manfrotto SA 2,478,374 6.05
Prudential plc 1,760,031 4.28
Post Office Pensions Trustees Limited and Possfund Custodian Trustee Limited 1,719,537 4.19
Harris Associates L.P. 1,687,184 4.11
Legal & General Investment Management Limited 1,645,736 4.01
Aviva Plc 1,623,127 3.96
Britel Fund Trustees 1,258,630 3.07
Hermes Focus Asset Management Limited and Hermes Investment Management Limited 1,256,234 3.06
Interest by Annual Report 2003 21
Directors
The directors during the whole of the year were Alison Carnwath
(Chairman), David Bell, Alastair Hewgill, John Potter, Gareth Rhys
Williams and Will Wyatt.
The remuneration of the directors is set out in the Remuneration
report on pages 23 to 29.
Photographs and biographies of the current directors are set out on
pages 18 and 19.
Payments to suppliers
It continues to be the Group's policy that the Company and
individual subsidiary companies are responsible for negotiating
terms and conditions under which suppliers operate. Once agreed,
payments to suppliers are made in accordance with those terms
and conditions, subject always to the supplier having complied 
with them. That policy will continue for the financial year ending 
31 December 2004. For the financial year ended 31 December
2003 the Company paid its suppliers on average within 15 days
(2002: 15 days) of date of invoice.
Committees of the Board
Details of the Audit committee, the Nominations committee and
the Remuneration committee are contained in the Corporate
governance section of this annual report and in the
Remuneration report.
Directors' shareholdings
The following table sets out the beneficial interests of those persons
who were directors at the end of the financial year. The interests in
the Company's shares are shown as at 31 December 2003 and 1
January 2003 or subsequent date of appointment. Details of the
directors’ other interests in the Company’s shares are set out in the
Remuneration report on pages 23 to 29.
1 January 2003
or subsequent
date of
appointment
Chairman
Alison Carnwath 35,000 35,000
Executive Directors
Gareth Rhys Williams 10,000 10,000
Alastair Hewgill 6,000 6,000
Non-executive Directors
David Bell --
John Potter 3,000 3,000
Will Wyatt 675 -
54,675 54,000
Directors’ shareholdings
31 December
2003 Directors’ report continued
22 The Vitec Group
Corporate social responsibility report
The Group’s report on social, environmental and ethical matters is
set out on pages 30 to 32. The Group has policies in respect of the
following key areas: risk and fraud, employment (including
employees and employee communication), whistleblowing,
environment, human rights, community impact and involvement,
relationships with suppliers, customers and other stakeholders.
Donations
During 2002, the Company made a contribution of £23,271 to its
account with Charities Aid Foundation. In 2003, the Company made
no contribution to that account because it was considered to be
adequately funded. Charitable donations were made by the Charity
committee from that account during 2003 totalling £7,000 (2002:
£6,998). No donations were made to any political party. For further
information on donations refer to the section on Community impact
and involvement set out in the Corporate social responsibility report
on pages 30 to 32.
Annual general meeting
The annual general meeting for 2004 will be held on Tuesday 
4 May 2004 at the offices of Financial Dynamics, Holborn Gate, 
26 Southampton Buildings, London WC2A 1PB. The notice of
meeting and a proxy card are enclosed. 
The Company will again be making use of the electronic voting
facility provided by its registrars, Capita Registrars. For further
information please refer to the section in Shareholder enquiries and
electronic voting set out on page 72.
The business of the annual general meeting will include the
consideration by shareholders of the report and accounts for the
year ended 31 December 2003, the Remuneration report, the
proposed dividend, election of a director, the re-election of the
auditor and the following further items of business.
The directors’ authority under Section 80 of the Companies Act
1985 to allot unissued shares in the Company will expire on 28 April
2004. Shareholders’ approval will be sought for the renewal of this
power for a further five years.
A resolution renewing the directors' authority to allot shares for cash,
as if the pre-emption provisions of Section 89 of the Companies Act
1985 did not apply, is set out in the notice of meeting. The first part
of the resolution deals with the allotment of shares for cash under a
rights issue, giving power to make adjustments to deal with overseas
shareholders, fractions of shares and similar matters. The second
part renews the power of the directors to allot shares for cash,
limited to 5% of the issued share capital at 1 March 2004. The
authority will expire at the end of the Company's next annual
general meeting or, if earlier, on 4 August 2005. Your directors have
no present intention of issuing or granting rights over the unissued
share capital, except in relation to the Company's adopted employee
share incentive arrangements and no share issue will be made
which will effectively alter the control of the Company without prior
approval of the shareholders in general meeting.
Any shares held in treasury and used by the Company for the
purposes of or pursuant to the employee share schemes operated
by the Company will, so long as required under institutional
guidelines, count towards the limits on the number of new shares
that may be issued under the rules of such employee share
schemes.
A resolution for a general authority for the Company to make market
purchases of its own shares was first passed at the annual general
meeting in 1998 and renewed by shareholders at subsequent
annual general meetings. The directors believe it is desirable to have
the power to make market purchases in the event of suitable
opportunities arising. Accordingly, a resolution to again renew the
authority will be proposed at the annual general meeting. The
authority to purchase shares would only be exercised if there was a
resultant increase in earnings per share, and it would be in the best
interests of the Company. Should the directors exercise such
authority, any shares so purchased may be placed in treasury in
accordance with The Companies (Acquisition of Own
Shares)(Treasury Shares) Regulations 2003, as amended and
subsequently cancelled or transferred to satisfy awards arising
under the Company’s employee share schemes or issued for cash
as provided for by the Regulations.
The Chairmen of the Board and of its committees will be in
attendance at the annual general meeting to answer questions from
shareholders.
Auditor
The auditor, KPMG Audit Plc, is willing to continue in office. A
resolution will be put to the annual general meeting to re-appoint
the auditor and to authorise the Board to agree the auditor’s
remuneration.
By order of the Board
Roland Peate
Secretary
1 March 2004 Remuneration report
Annual Report 2003 23
This report contains the information required under the revised
Combined Code and under the Directors’ Remuneration Report
Regulations 2002. A resolution to approve the report will be
proposed at the 2004 annual general meeting. The Chairman of the
Remuneration committee will be available to answer questions about
directors' remuneration at the annual general meeting.
Remuneration committee
At the commencement of 2003, the Remuneration committee
comprised David Bell (Chairman of the Committee), Alison
Carnwath, John Potter and Will Wyatt, being all of the independent
non-executive directors. On 4 March 2003, the membership of the
Committee was reviewed and reconstituted to comply with the
recommendation in the Higgs Report into the role and effectiveness
of non-executive directors that no one director should sit on all
three principal board committees. The result of that review was that,
with effect from 4 March 2003, the Remuneration committee
comprised David Bell (Chairman of the Committee), Alison
Carnwath and John Potter.
On 18 December 2003, the terms of reference of the Committee
were reviewed and updated to comply with the revised Combined
Code. Under its terms of reference, the Committee, on behalf of the
Board, determines the remuneration packages including bonus
arrangements, participation in incentive schemes, pension
contributions and all other benefits received by the executive
directors. In the event of the termination of employment of those
directors, the Committee would also determine any compensation
payments, after taking appropriate legal advice. The Committee also
makes recommendations to the Board, within its terms of reference,
on the framework of senior executive remuneration including terms
of service, pay structure, bonus and share incentive arrangements
and other benefits. 
The Chief Executive, Gareth Rhys Williams, attends meetings by
invitation of the Committee except when his remuneration is being
considered. The remuneration of the non-executive directors is
determined by the Board as a whole with the relevant non-executive
director abstaining when his or her remuneration is considered.
Remuneration policy
The executive directors’ remuneration comprises a basic salary
plus company and/or individual performance-related elements of
up to 100% of salary. Therefore, if they achieve maximum
performance in relation to the performance-related elements
of their remuneration, these elements will account for 50% of their
total remuneration. 
Remuneration packages are formulated to attract, retain and
motivate executive directors and senior executives of the quality
required, without being excessive, by reference to salary and benefit
surveys supplied by external sources. They take into account the
responsibilities involved, remuneration packages in comparable
companies that have similar international operations, relative
performance and both internal and external advice. Remuneration
and benefits reflect responsibility and market comparisons.
The notice period by the Company under the service contracts of
the executive directors is 12 months. The normal retirement age
of executive directors is 60. Basic salary is fully pensioned on a
funded basis. Executive directors' service contracts do not provide
for pre-determined amounts of compensation in the event of early
termination by the Company. The Committee's policy in the event
of early termination of employment is to mitigate compensation to
the fullest extent practicable.
The Committee believes that in certain specific circumstances it is
beneficial for an executive director to be encouraged to take up
external non-executive appointments. Remuneration received by a
director in respect of such external appointments would be retained
by the director.
The Committee currently has no intention of amending the above
stated policy for 2004 and future years, although it will be reviewed
from time to time.
When reviewing and determining executive and non-executive
directors’ remuneration, advice is sought and received from external
remuneration and benefit consultants and their various Remuneration report continued
surveys of remuneration and fees and also internally from the
Chief executive, Gareth Rhys Williams, and the Company secretary,
Roland Peate. Towers Perrin, which was formally appointed in early
2003, has, during the year, provided independent advice to the
Committee. In December 2003, the Committee received external
and internal advice on the salaries of the executive directors and of
the senior management team. 
Chairman and the other non-executive directors
The Chairman and the other non-executive directors do not have
service contracts but have letters of appointment. The initial
period of their appointments is normally three years and may, by
mutual consent and with the approval of the Nominations
committee and the Board, be extended for a further three years. 
In exceptional circumstances appointments may be extended
beyond six years, by mutual consent and with the approval of the
Nominations committee and the Board, if it is in the interests of
the Group to do so.
Executive directors
Executive directors’ remuneration comprises basic salary, bonus,
share incentives, company vehicle or cash allowance, fuel where a
company vehicle is provided, medical health insurance,
membership of the Group’s Executive Pension Scheme, life
assurance and additionally, for Gareth Rhys Williams, contributions
towards a permanent health arrangement and contributions paid by
the Company to a funded unapproved retirement benefits scheme.
It is the Company's policy to make provision for pensions for
executive directors in respect of their basic salaries (but not in
respect of annual bonuses or benefits) through funded retirement
benefit schemes. Up to the maximum salary level permitted by
Inland Revenue rules (the earnings cap), retirement benefits are
provided through an approved retirement benefit scheme, as shown
in the table entitled Pensions related remuneration. 
Gareth Rhys Williams, Chief executive, aged 42, is employed under
a service contract dated 23 November 2001. The notice period by
the Company under his contract is 12 months; notice by the
employee is 6 months. The Company may, in the event of
termination of employment, pay a sum in lieu of notice equal to
twelve months’ gross basic salary together with the gross value of
the other benefits that he is entitled to receive under his service
contract, but excluding pension contributions and any bonus. The
bonus arrangements for 2004 will be calculated on the basis that
100% relate to the achievement of operating profit targets. The
unexpired term of Gareth Rhys Williams’ service contract, to his
normal retirement date, is 18 years.
Alastair Hewgill, Finance director, aged 49, is employed under a
service contract dated 17 April 2002. The notice period by the
Company under his contract is 12 months; notice by the employee
is 6 months. The Company may, in the event of termination of
employment, pay a sum in lieu of notice equal to twelve months’
gross basic salary together with the gross value of the other benefits
that he is entitled to receive under his service contract, but
excluding pension contributions and any bonus. The bonus
arrangements for 2004 will be calculated on the basis that 100%
relate to the achievement of operating profit targets. The unexpired
term of Alastair Hewgill’s contract, to his normal retirement date, is
11 years.
Incentive arrangements
The current policy of the Remuneration committee is to make
annual awards under the Long Term Incentive Plan to the executive
directors and the other members of the Executive Board and grants
of conventional share options to the Group’s senior management
immediately below the level of the Executive Board. Such awards
and grants are based on a proportion of salary. Participation in the
Deferred Bonus Plan is open to those employees who are members
of the Group’s bonus scheme and who receive a bonus. There are
currently no plans to make any further grants under the Premium
Option Plan. Invitations under the Group’s Sharesave arrangements
are usually made annually. This policy is reviewed at least annually
and may be revised from time to time. Such awards and grants take
into account the overall and flow limits advised by the Association of
British Insurers.
To align the rewards of executive directors and other senior
employees more closely with the objectives and interests of
shareholders, the performance conditions applicable to the Group’s
share option schemes and the Long Term Incentive Plan are as set
out below and relate to increases in earnings per share over a
performance period. The performance condition applicable to the
Premium Option Plan is also shown below and relates to a
significant increase in the Company’s share price. There is no re-
testing of performance in respect of grants or awards. Monitoring
and measuring of the performance conditions take place at the end
of each year when the Company’s results have been audited and
again at the time of exercise of options and awards.
24 The Vitec Group Annual Report 2003 25
The Group currently has the following incentive schemes and plans
in place under which incentives may be granted:
2002 Executive share option scheme. This is an Inland Revenue
approved scheme. Executive directors and other senior employees
are selected to receive options over shares. Exercise of an option is
subject to growth in the Company’s earnings per share, excluding
exceptional or extraordinary items, exceeding the growth in the retail
prices index over a performance period. The percentage growth over
the retail prices index determines the proportion of the award that
may be exercised. Options are exercisable between the third and
the tenth anniversaries of their dates of grant.
Performance condition: If the percentage growth in the adjusted
earnings per share of the Company exceeds the percentage growth
in the retail prices index over the 3 year performance period by
3.0301% (the base target threshold), an option will become
exercisable in respect of one-third of the shares over which it
is held. Full vesting takes place when such growth over the
performance period is 9.2727% or greater. A sliding scale operates
for performance between the lower and upper thresholds. Options
lapse if the base target threshold is not achieved. There is no
re-testing of performance.
2002 Unapproved executive share option scheme. Executive directors
and other senior employees are selected to receive options over
shares. As with the 2002 Executive share option scheme, exercise
of an option is subject to growth in the Company’s earnings per
share, excluding exceptional or extraordinary items, exceeding the
growth in the retail prices index over a performance period. Options
are exercisable between the third and the tenth anniversaries of
their dates of grant.
Performance condition: The performance condition is identical in all
respects to the performance condition of the 2002 Executive share
option scheme set out above. There is no re-testing of performance.
Long term incentive plan. Under this plan, executive directors and
other senior employees are selected to receive awards over shares
that vest in whole or in part depending on the satisfaction of a
performance condition related to the growth in earnings per share
compared to the retail prices index over a performance period.
Performance condition: The performance condition attaching to
awards under the plan relate to increase in earnings per share. For
an award to vest in its entirety, the increase in earnings per share
over the performance period of 3 years must be not less than the
increase in the retail prices index plus 36% or more. For an award
to vest at its lowest level of 25%, the growth in earnings per share
over the performance period must be equal to the increase in the
retail prices index plus 9%. Awards lapse if the performance is
below 9%. Where growth is between 9% and 36% awards are
realisable on a straight-line basis.
Premium option plan. Under this plan, selected executive directors
and other senior employees receive options over shares that are
granted in the form of two tiers. The exercise price of the first tier is
set at 25% in excess of the share price immediately prior to the date
of grant; the exercise price of the second tier is set at 50% in excess
of that same share price. 
Performance condition: First tier options are only exercisable if the
average middle market price of the Company's shares increases to,
and remains in excess of, the option exercise price for a minimum
of 20 consecutive dealing days within three years of the date of
grant. Second tier options are only exercisable if the average middle
market price of the Company's shares increases to, and remains in
excess of, the option exercise price for a minimum of 20 consecutive
dealing days within five years of the date of grant. Each tier of
options lapses if the share price does not achieve the required
threshold within the relevant performance period. Subject to the
share price reaching the required threshold, options are exercisable
between the third and the tenth anniversaries of their dates of grant.
Deferred bonus plan. Under the plan, an eligible executive may defer
between 10% and 50% of his cash bonus in exchange for receiving
an award over shares in the Company with a value equivalent, at the
date of award, to the amount of the deferred bonus. An award may,
in normal circumstances, be exercised by a participant after 2
years. However, if exercise is deferred until after 3 years and the
executive remains employed by the Group, the participant is entitled
to receive additional shares equal in number to those comprised in
the award. 
Performance conditions: Bonuses received by participants, and
which may be deferred under the plan, are themselves subject to
demanding performance conditions linked to Company and/or
individual performance. The awards under the plan are not subject
to any further performance targets.
2002 Sharesave scheme and International plan. The Group also
operates a Savings related share option scheme in the UK and a
similar International plan in respect of overseas employees in certain
countries. The scheme and plan are open to all the Group’s
employees in those geographical areas who have the necessary
length of service. Under the scheme and plan participants contract
to save a set amount each month in return for which they receive an
option over a specified number of shares. At the end of the savings
period participants may exercise their options to buy shares in the
Company using their savings. Exercise is not subject to any
performance condition. Remuneration report continued
Five-year share price performance 1999-2003
Under the requirements of the Directors’ Remuneration Report
Regulations 2002, the Company is required to include a graph
showing the Company’s performance compared to an appropriate
index. Set out below, the graph illustrates the Company’s annual
Total Shareholder Return (share price growth plus dividends that
have been declared, paid and reinvested in the Company’s shares)
relative to the FTSE Engineering and Machinery Index for the five
year period 1999-2003, assuming an investment of £100. The
Engineering and Machinery Index is the broad market index that
includes the Company and comprises comparable companies.
The following information has been audited.
Directors' emoluments and compensation
For her non-executive duties, the Chairman, Alison Carnwath,
currently receives a fee of £78,000 per annum. The non-executive
directors each receives a fee of £25,000 per annum. The chairmen
of the Remuneration committee and of the Audit committee, David
Bell and John Potter, respectively, receive an additional £2,500 per
annum fee for their services as chairmen of those committees.
The Chairman is a member of the Group’s medical insurance
scheme, the premiums for which are paid by the Company. The
non-executive directors do not receive any other benefits from
the Company.
Gareth Rhys Williams, Chief executive, currently receives an
annual salary of £267,800, increased from £260,000 with effect
from 1 January 2004. Mr Rhys Williams is a member of the Vitec
Group Executive Pension Scheme and contributes 7% of his
salary up to the earnings cap. That pension scheme is a defined
benefit scheme, the accrual rate for which is one fortieth of his
pensionable salary for each year of pensionable service. In
accordance with his service contract, the Company makes
contributions of 24% of his annual salary in excess of the earnings
cap to his funded unapproved retirement benefits scheme.
In addition, a guaranteed pension-related bonus of 16% of his
annual salary in excess of the earnings cap is paid to him. He is
eligible for a performance-related bonus, based on Company and/or
individual performance, of up to 100% of base salary each year. In
respect of 2003, 50% of the bonus was conditional upon the
Group’s performance and 50% was based on personal performance
targets. Mr Rhys Williams received a bonus of £100,000 in respect
of 2002 and of £52,000 for 2003. 
Alastair Hewgill, Finance director, currently receives an annual
salary of £180,000, increased from £155,000 with effect from 1
January 2004. Mr Hewgill is a member of the Vitec Group Executive
Pension Scheme and contributes 7% of his salary. That pension
scheme is a defined benefit scheme, the accrual rate for which is
one fortieth of his pensionable salary for each year of pensionable
service. Mr Hewgill is eligible for a performance-related bonus,
based on Company and/or individual performance, of up to 100% 
of annual salary each year. In respect of 2002 he was awarded 
a discretionary bonus of £27,000 and for 2003 his bonus 
was £31,000.
26 The Vitec Group
Vitec Group plc
FTSE Engineering &
Machinery Index
Dec-98 Dec-99
£130
£120
£110
£100
£90
£80
£70
£60
£50
Dec-00 Dec-01 Dec-02 Dec-03
Five-year historical shareholder return
performance. Change in the value of a
hypothetical £100 holding over five years.
FTSE Engineering and Machinery Index
comparison based on 30 trading day
average values Annual Report 2003 27
Total
2002
£
2003
£
Termination
payments
(Note 3)
2002
£
2003
£
Pension
related bonus
(Note2)
2002
£
2003
£
Performance
related annual
bonus
2002
£
2003
£
Benefits
(Note 1)
2002
£
2003
£
Salaries and
fees
2002
£
2003
£
Chairman
Alison Carnwath 78,000 75,000 428 468 – – – – – – 78,428 75,468
Executive directors
Gareth Rhys Williams 260,000 250,000 21,198 20,884 52,000 100,000 25,835 24,523 – – 359,033 395,407
Alastair Hewgill 155,000 94,828 11,068 4,335 31,000 27,000 – – – – 197,068 126,163
Richard Green – 58,810 – 4,891 – – – – – 323,862 – 387,563
Non-executive directors
David Bell 27,500 26,250 – – – – – – – – 27,500 26,250
John Potter 27,500 26,250 – – – – – – – – 27,500 26,250
Michael Stacey – 19,200 – – – – – – – – – 19,200
Will Wyatt 25,000 14,041 – – – – – – – 25,000 14,041
573,000 564,379 32,694 30,578 83,000 127,000 25,835 24,523 – 323,862 714,529 1,070,342
Director’s name
Notes
1. The principal benefits are a company car, fuel, medical insurance and life
assurance. In respect of Gareth Rhys Williams only, a cash payment of £1,200
per month in lieu of a company car and a contribution of £400 per month to a
permanent health arrangement are included in the figures shown for benefits.
Details of the directors’ emoluments and compensation for 2003
with comparatives for 2002 are set out in the table below:
2. Gareth Rhys Williams receives a pension-related bonus calculated at 16%
of his annual salary in excess of the pensions earnings cap.
3. Information on the termination payment in 2002 is set out below.
During the year the highest paid director was Gareth Rhys Williams
who received £359,033 (2002: £395,407(excluding the termination
payment made to a director during 2002)).
When termination payments are included, the highest paid director
in 2002 was Richard Green who received a total of £431,188
(£387,563 shown in the table above plus a gain of £43,625 on the
exercise of a share option). That total included payments in lieu of
salary, bonus, company car benefit, pension-related bonus and
contributions to Mr Green’s FURBS and represented the Company’s
mitigated liability, shortened to 15 months, under his service
contract. In addition, £5,340 was paid direct to Mr Green’s legal
adviser in respect of advice he received in connection with the
negotiation of his termination arrangements. Mr Green resigned as a
director on 13 May 2002. Remuneration report continued
Notes
1. In November 2001, a share price related cash bonus scheme was adopted
under which an award equivalent to an option over 142,857 shares, at a price of
£3.50 per share, was made to Gareth Rhys Williams. This was replaced on 
19 September 2002 by an equivalent option over 142,857 shares at the same
exercise price of £3.50 per share under the Rules of the (1996) Unapproved
Executive Share Option Scheme, the Scheme used as the comparable for the cash
bonus scheme. There is a transitional arrangement for the cash bonus scheme to
run in tandem with the share option. If, and to the extent that, the cash bonus is
not triggered by Mr Rhys Williams prior to the first occasion upon which he
becomes entitled to exercise the share option granted on 19 September 2002,
the cash bonus scheme will lapse and will be replaced by the share option.
2. Non-executive directors are not eligible to participate in the Company’s share
option or share incentive schemes and consequently they do not hold any share
options or other share incentives.
3. The total gain on the exercise of options by the directors during 2003 was nil
(2002: £43,625) as no options were exercised.
4. The share price at the end of the year and the highest and lowest prices during
the year are shown on page 72.
Expiry date
Date from
which
exercisable
Market
price at
exercise
date
(pence)
Exercise
price
(pence)
At 31
December
2003 or, if
earlier,
date of
resignation
as a
director 
Options
granted
during
year
Options
exercised or
lapsed
during
year
At
1 January
2003
Date of
grant
Gareth Rhys Williams
Executive share options
1996 Unapproved Sep 2002 142,857 – – 142,857 350 – Sep 2005 Sep 2012
SAYE options Nov 2002 2,451 – – 2,451 268 – Jan 2008 Jun 2008
May 2003 – – 4,266 4,266 231 – Jun 2008 Dec 2008
Alastair Hewgill 
SAYE options May 2003 – – 7,110 7,110 231 – Jun 2008 Dec 2008
145,308 – 11,376 156,684 –
Directors’ share options
Awards at 
1 January
2003
(shares)
Market price
of a share
at the date
of award
(pence)
Date of
award
Awards
exercised
or lapsed
during
the year
(shares)
Awards
made
during
the year
(shares)
At
31 December
2003 or date
of resignation
as a director
(shares)
Gareth Rhys Williams Mar 2002 442.5 28,248 – – 28,248
Mar 2003 257.5 – – 50,485 50,485
Alastair Hewgill Sep 2002 342.5 21,898 – – 21,898
Mar 2003 257.5 – – 30,097 30,097
Directors’ long term incentives
Awards under the Long term incentive plan
28 The Vitec Group Annual Report 2003 29
Awards at 
1 January
2003
(shares)
Market price
of a share
at the date
of award
(pence)
Date of
award
Awards
exercised
or lapsed
during
the year
(shares)
Awards
made
during
the year
(shares)
At
31 December
2003 or date
of resignation
as a director
(shares)
Gareth Rhys Williams Jun 2003 345 – – 7,705 7,705
Basic
Jun 2003 345 – – 13,755 13,755
Matching
Alastair Hewgill Jun 2003 345 – – 1,651 1,651
Basic
Jun 2003 345 – – 2,947 2,947
Matching
Awards under the Deferred bonus plan
Increase in
transfer value
over year to 
31 December
net of member
contributions
2003
£
Transfer value
of the increase
in accrued
pension net
of member
contributions
2002
£
Transfer
value of
accrued
pension at
31 December
2003
£
2003
£
2002
£
Member
contributions
towards
pension
2002
£
2003
£
Increase in
accrued pension
(in excess of
price inflation)
during
2002
£
2003
£
Accrued
pension at
31 December
2002
£
2003
£
Gareth Rhys Williams 5,156 2,633 2,478 2,434 6,899 6,773 9,058 7,196 33,874 15,444 11,531
Richard Green - 25,110 - 1,657 - 3,400 - 10,904 - 274,858 -
Alastair Hewgill 5,225 1,890 3,303 1,890 10,763 6,125 20,458 9,802 50,321 16,234 23,324
Pensions related remuneration
Beyond the earnings cap, the cost of pensions comprised defined
contribution payments to FURBS as follows: Gareth Rhys Williams
£38,748 (2002: £36,780). Richard Green left the company on 30
June 2002 and therefore no payments have been made during
2003 to his FURBS. For the period from 1 January 2002 to the date
of his leaving on 30 June 2002 contributions totalled £8,548. 
By order of the Board
Roland Peate
Secretary
1 March 2004 Corporate social responsibility report
30 The Vitec Group
Last year the Group published its first detailed corporate social
responsibility report although it has been including an environmental
policy statement in its annual report for some years. This year the
Group has developed further its social responsibility awareness and
internal reporting of statistics. We plan to continue development,
and the inclusion of an environmental report, in the future.
The Group has for many years taken a caring and considerate
approach to social, environmental and ethical matters throughout
its operations worldwide and this will continue. The Group regards
compliance with all relevant laws and guidelines as important and
socially responsible.
The Group’s current system of risk management and control, which
includes social responsibility matters, is led by the heads of each of
the Group’s operations. Those people are responsible at local level
for complying with the relevant environmental regulations in all the
geographical areas in which they operate. They report to the Board
on such issues through the Group’s Finance director, who has
ultimate responsibility for such matters, as part of the Group’s
system of internal control and risk management reporting.
Overall the Group continues to believe that it has limited
environmental impact. However, we recognise that we have a
responsibility to understand the impact that our activities might
have at local, national and global level. These have been monitored
and assessed locally and solutions have been implemented as
appropriate according to best practice, local legal and other
requirements. However, we have now developed and implemented a
more consistent approach to adopt sound policies throughout all our
operations. As part of the implementation programme, we have put
in place more formal systems and procedures for identifying,
measuring, reviewing and reporting on social, environmental and
ethical matters. Group policies are in place in the key areas of
employment, environment, human rights, community impact and
involvement and relationships with suppliers, customers and other
stakeholders. These policies have been implemented at the centre
and within each operating entity. Specific responsibility for such
matters has been assigned to designated employees. Reviews by
local management take place at each Group location and reports
are made of the major risks in these areas. These reports identify
risks, the current measures being taken to control them and the
steps being taken to eradicate or minimise their effect in the future.
The compilation of statistics commenced last year and they are
being used to monitor improvements and for reporting purposes.
1. Employment
Policy
To comply with all relevant legislation and codes of practice relating
to employment, health and safety and equal opportunities. To
provide good quality working environments & facilities for employees
and training and development appropriate to each of their roles;
not to discriminate in any way; to take a flexible approach towards
family responsibilities to assist them in establishing an appropriate
work/life balance; to provide a competitive range of quality
employee benefits. To keep the workforce informed of major
events and developments within the Group.
Actions
Employment policies throughout the Group already reflect the policy
set out above.
We continue to recognise the importance of involvement,
motivation, training and development of our employees at all levels.
The importance of good communication and working relationships
is actively encouraged. During 2003 the Group’s website was
re-written and significantly enhanced. It now provides much more
useful information and includes a gallery containing photographs of
Group products. This helps investors, potential investors and
employees alike to understand and view the wide variety of
products available from Group companies.  
Our policy is to keep employees informed on matters relating to
their employment and on financial and economic factors affecting
the Group through management briefings, via the Group’s website
and by internal distribution of press releases and internal
announcements. This enables our employees to gain a better
understanding of our business objectives and their roles in achieving
them. Building and developing the skills, competencies, motivation
and teamwork of our people is key to achieving our business
objectives and to ensuring best practices throughout the Group.
The senior executives of the Group, including the Chief executive
and the Finance director, meet on a regular basis. In addition, the
managements of the operating units employ a wide variety of
consultation and briefing methods, including conferences, joint
committees, specific project teams and briefing groups.
The Group operates in many countries and our employment
policies, which are designed to meet local conditions and
requirements, are established on the basis of the best practices in Annual Report 2003 31
each country in which we operate. The Group’s wide geographical
spread provides some opportunities for employees to work either
short term or on secondment for longer periods of time at the
Group’s various locations.
Encouragement is given to all employees both in the UK and
overseas to participate in the Group's savings related share option
schemes under which options are granted to employees who enter
into contracts to save agreed amounts each month. Invitations
under the UK and the International schemes have been made
each year since the schemes were first introduced in 1984.
Ability and aptitude are the determining factors in the selection,
training, career development and promotion of all employees. If
an employee becomes disabled during his or her period of
employment, we will, if necessary and to the extent possible, adapt
the work environment to enable the employee to continue in his or
her current position or retrain the employee for duties suited to that
employee's abilities following disablement. It continues to be the
Group’s policy to consider applications for employment from
disabled people on the same basis as other potential employees.
Health and safety
Health and safety training is part of the induction process for new
employees. Specific training is given, where relevant, for forklift
truck, crane and hoist operation and bottle gas usage as well as fire
safety and first aid training.
Risk assessments were introduced during 2003 in various parts of
the Group and these are being phased into the other parts of the
Group. Assessments are being carried out on a regular basis and
also when new equipment or machinery is acquired or new
processes are introduced.
During 2003 the recording and reporting of accidents and related
lost time statistics has become formalised. The figures are reviewed
monthly and at each meeting of the Executive Board.
Workplace injuries and fatalities in 2003
Rate of non-fatal over 3-day
workplace injuries (Notes 1 and 2) 1,333
Rate of fatal workplace injuries (Note 2) nil
Notes
1 Over 3-day workplace injury means an injury at work leading to an absence
from work of more than 3 days.
2 The above rates are expressed per 100,000 employees, in line with the
normal reporting standard by the Health & Safety Executive.
2. Environment
Policy
To promote and improve throughout the Group the benefits of
efficient usage of energy and water.
Actions
Recycling processes have been in use in the Group for many years.
Recycled materials and those that minimise negative environmental
impacts are used wherever possible. A steadily increasing proportion
of the packaging, paper, toner cartridges and cartons used by the
Group’s operations is recycled after use and in many cases
biodegradable packaging is used.
It is in the interests of the environment and in the financial interests
of the Group to make the most efficient and responsible use of
energy. The practice of responsible resource and energy
management through reduced consumption and the
encouragement of energy and water efficiency is widespread
throughout the Group’s operations world-wide.
Developments during 2003 include:
Vinten continues to refine and develop its Environmental
Management System, taking into account appropriate best
practices. Vinten strives to improve consumption of materials in
all operations and to reduce, rather than have to dispose of, waste
wherever possible and to promote recycling and the use of recycled
materials. Vinten works in partnership with its suppliers to minimise
the impact of operations through a quality purchasing policy and
recycling through suppliers. They also use a recycling system that
covers paper, cans and plastic cups and have an on-going
water-efficiency programme.
Drake has introduced the use of standard thickness packaging by
switching from tri-wall to double-wall packing to reduce cardboard
use. The use of bespoke packaging has also reduced the use of
bubble wrap and polystyrene chippings. Drake aims to further
reduce the use of bubble wrap and polystyrene chippings by
increasing their use of bespoke packaging. Their new building 
in Cambridge is generally more energy efficient than their 
previous premises.
During 2004, Drake and Clear-Com plan to implement any actions
necessary to comply with the EU Directives on Waste Electrical and
Electronic Equipment and on the Restriction of Use of Certain
Hazardous Substances.
Anton/Bauer continues to be an active member of the battery
recycling scheme in conjunction with The Rechargeable Battery
Recycling Corporation. In 2003 they increased their recycling of
nickel cadmium batteries by 18% and of NiMH batteries by 50%
over 2002 figures. Anton/Bauer currently uses energy saving
lightbulbs in all areas but will be switching to lead free bulbs with a
low mercury content in 2004.  Corporate social responsibility report continued
During 2003 ALU switched to using cardboard from using a
chemical foam substance for its own packing requirements when
shipping products. This means that the cardboard may then be
recycled by the receiver of the shipment, whereas this was not
possible with the chemical foam packaging. ALU was disposed of
in December 2003 and so its operations have no continuing
environmental impact in the Group. 
OConnor continues to recycle the remnant ink from its printers and
photocopier, use energy saving lightbulbs, use electronic timers for
heating and air conditioning units, and to recycle all of its machine
cutting chips and scrap metal. OConnor’s hazardous waste materials
and liquids are collected by a waste management company for
disposal. Deburr particles are separated from process liquid by a
cyclonic separator and properly disposed of – the liquid is then
reused. All OConnor’s product packaging uses recycled materials.
The energy consumption figures for 2003 compared to those for
2002 (excluding the acquisitions in 2003) show a reduction in the
usage of gas and water. However, overall in 2003, the Group’s use
of electricity and water has risen when compared to 2002 due to
higher activity levels and the acquisition of OConnor and Radamec
Broadcast Systems in the early part of 2003. The Group’s use of gas
in 2003 has reduced. The target for future years is to reduce or, at
worst, maintain the ratio of energy consumption at the Group’s
current activity levels.
Any increase or decrease in activity levels in the future, and any
acquisition or disposal by the Group, would result in an increase or
decrease in the Group’s energy consumption.
3. Human rights
Policy
To comply with the laws and customs of each country in which we
operate. Not to use child labour. Not to discriminate in any way and
to give equal opportunities to all workers.
Actions
The above policy has been part of the Group’s approach for many
years. The Group’s operating companies are required to include it
as part of their employee policies and to comply.
4. Community impact and involvement
Policy
To contribute to local worthwhile causes and charities and to ensure
that the Group’s operations cause minimal negative impact within
the community.
Actions
For many years the Group has contributed to worthwhile causes.
Donations are usually, and have been in the past, primarily to
childrens, cancer, police, fire brigade, drug rehabilitation and other
similar charities. The Group’s charity committee reviews all written
requests for donations and decides on the level of donation and the
charities to which donations are made.
During 2003 donations were made to 20 charities. The amount
donated by the charity committee totalled £7,000 (2002: £6,998).
Like all companies, the Group has limited resources and the
amount of money available for charitable purposes varies from
time to time.
5. Relationships with suppliers, customers and other stakeholders
Policy
The Group recognises the obligations it has towards the parties with
whom it has business and other dealings such as its customers,
shareholders, employees, suppliers and advisers. Dealings with
those groups of people depend upon the honesty, integrity and
enthusiasm of its employees and every effort is made to ensure that
a high standard of expertise and business principles is maintained
in such dealings. Where appropriate, training is given to maintain
and to raise the standards.
Actions
As stated in the Directors’ report, the Group's policy with suppliers is
that individual subsidiary companies are responsible for negotiating
terms and conditions under which suppliers operate. Once agreed,
payments to suppliers are made in accordance with those terms
and conditions, subject always to the supplier having complied with
them. That policy has been in place for a number of years and will
continue for the financial year ending 31 December 2004. We
continue to review and take action where appropriate to ensure the
reliable and consistent sources of quality materials from which our
products are made.
In all our dealings, honesty and integrity continue to be paramount.
The Group’s brands are a highly valuable asset and every effort is
made to enhance their reputation for high quality, service and
reliability.
Electricity usage 
(in kilowatt hours)
Gas usage
(in kilowatt hours)
Water usage
(in cubic metres)
8,114,982 4,993,294 25,912
Energy usage 
in 2003
32 The Vitec Group Corporate governance
Annual Report 2003 33
The Listing Rules require a company to include in its annual report
and accounts a statement of how it has applied the principles set
out in Section 1 of the Combined Code (the "Code") together with
an explanation to enable its shareholders to evaluate how the
principles have been applied. The Listing Rules also require a
company to include a statement as to whether or not it has
complied throughout the accounting period with the Code
provisions set out in Section 1 of the Code. A company that has
not complied with the Code provisions, or complied with only some
of the Code provisions or (in the case of provisions whose
requirements are of a continuing nature) complied for only part
of an accounting period, must specify the Code provisions with
which it has not complied, and (where relevant) for what part of
the period such non-compliance continued, and give reasons for
such non-compliance.
The Code was revised in 2003 (the "new Code"). The new Code
supersedes the Code for listed companies with reporting years
beginning on or after 1 November 2003. However, the Company has
already taken steps to ensure that it complies with the main and the
supporting principles of the new Code and with its provisions.
Statement of compliance
The Board considers that it has complied with the Code throughout
the year ended 31 December 2003. The Company regularly reviews
and revises its procedures, as necessary, to take account of the
requirements of the Code and of the new Code.
The Board
The Board meets on average six times a year and there is a formal
schedule of matters and levels of authority which are delegated to
the executive directors, all other matters and powers being reserved
to the Board. 
Throughout the year the Board comprised four non-executive
directors and two executive directors. All the non-executive directors
are considered to be independent. Gareth Rhys Williams was a
director and the Chief executive throughout the year. Alastair Hewgill
was the Finance director throughout the year. During 2003 all the
directors attended all the Board meetings.
The directors bring independent judgement to bear on strategic
matters, the performance of the Group, the adequacy of resources
and standards of conduct. The roles of the Chairman (who is
non-executive) and of the Chief executive are separate and they
each have a clear written division of responsibilities approved by
the Board. David Bell is the senior independent director and his
biographical details are shown on page 19. Outside of Board
meetings, the non-executive directors maintain regular contact with
each other by telephone and usually meet prior to Board meetings.
The same pattern of contact outside of Board meetings is planned
to continue through 2004.
Directors, having notified the Chairman, are able to take
independent professional advice at the Company's expense in
furtherance of their duties. All new directors are given an extensive
introduction to the Group, including meeting with senior executives
and visiting the Group's principal operations both in the UK and
overseas. All directors have access to the advice and services of the
Group company secretary.
The papers supplied for consideration by the Board are provided on
a timely basis and include budgets, strategy papers, reviews of the
Group's financial position and operating performance and annual
and interim reports and accounts. Further information is supplied
from time to time as and when requested by the Board.
The Board has an Audit committee, a Remuneration committee
and a Nominations committee. Each committee has formal terms
of reference. The members of these committees are shown on
pages 18 and 19.
The terms of reference and the effectiveness of each committee
have been reviewed and changes have been made in the light of
the new Code. Individual director performance evaluation has also
taken place. In the case of the executive directors this evaluation
takes place regularly throughout the year against achievement of
specific objectives. Evaluation of the Chairman has been carried
out by the senior independent director. Evaluation of each of the
other non-executive directors has been carried out by the
Chairman. Each evaluation has been carried out by using written
questionnaires and has been discussed individually with each of
the relevant non-executive directors. Similar evaluations will take
place each year in the future.
Audit committee
The members of the Audit committee and their biographical
details are shown on pages 18 and 19. The committee is chaired
by John Potter. Each member of the committee is required to be
independent. The Company’s external auditor is invited to attend
meetings of the committee on a regular basis. During 2003 the
committee met 3 times. One of those meetings was with the auditor,
without the executive directors being present. This will continue in
the future.
Duties of the committee:
Financial Reporting
Monitor the integrity of the financial statements of the Company,
including its annual and interim reports, preliminary results’
announcements and any other formal announcement relating to its
financial performance, reviewing significant financial reporting
issues and judgements which they contain.
Review the annual financial statements of the pension funds where
not reviewed by the Board as a whole. Corporate governance continued
Internal Controls and Risk Management Systems
Keep under review the effectiveness of the Company’s internal
controls and risk management systems; and review and approve the
statements to be included in the annual report concerning internal
controls and risk management. 
Whistleblowing
Review the Company’s arrangements for its employees to raise
concerns, in confidence, about possible wrongdoing in financial
reporting or other matters. The committee ensures that these
arrangements allow proportionate and independent investigation
of such matters and appropriate follow up action.
Internal Audit
The Company does not have an internal audit function. However,
the need for such a function is regularly reviewed and considered
by the committee. (Refer to the final paragraph of Internal Control
and Risk Management).
External Audit
Consider and make recommendations to the Board, to be put to
shareholders for approval at the annual general meeting, in relation
to the appointment, re-appointment and removal of the Company’s
external auditor. The committee oversees the selection process for a
new auditor and, if an auditor resigns, the committee is required to
investigate the issues leading to this and decide whether any action
is required.
Oversee the relationship with the external auditor including, but not
limited to:
• approval of its remuneration, whether fees for audit or non 
audit services and that the level of fees is appropriate to enable 
an adequate audit to be conducted;
• approval of its terms of engagement, including any 
engagement letter issued at the start of each audit and the
scope of the audit;
• assessing annually its independence and objectivity taking into 
account relevant professional and regulatory requirements and 
the relationship with the auditor as a whole, including the 
provision of any non audit services;
• satisfying itself that there are no relationships (such as family, 
employment, investment, financial or business) between the 
auditor and the Company (other than in the ordinary course
of business);
• agreeing with the Board a policy on the employment of former 
employees of the Company’s auditor, then monitoring the 
implementation of this policy; 
• monitoring the auditor’s compliance with relevant ethical and 
professional guidance on the rotation of audit partners, the level 
of fees paid by the Company compared to the overall fee income 
of the firm, office and partner and other related requirements; 
• assessing annually its qualifications, expertise and
resources and the effectiveness of the audit process which
shall include a report from the external auditor on its own 
internal quality procedures; 
• meeting regularly with the external auditor, including at the 
planning stage before the audit and after the audit at the 
reporting stage. The committee meets the external auditor at 
least once a year, without executive directors being present, to 
discuss their remit and any issues arising from the audit;
• reviewing and approving the annual audit plan and ensuring that 
it is consistent with the scope of the audit engagement;
• reviewing the findings of the audit with the external auditor. This 
includes but is not limited to the following;
• a discussion of any major issues that arose during the audit,
• any accounting and audit judgements, and
• levels of errors identified during the audit.
• reviewing the effectiveness of the audit and reviewing any 
representation letter requested by the external auditor before 
it is signed by management;
• reviewing the management letter and management’s response to 
the auditor’s findings and recommendations;
• developing and implementing a policy on the supply of non audit 
services by the external auditor, taking into account any relevant 
ethical guidance on the matter.
Reporting Responsibilities
• The committee chairman reports to the Board on its
proceedings after each meeting on all matters within its duties 
and responsibilities.
• The committee makes whatever recommendations to the Board it
deems appropriate on any area within its remit where action or 
improvement is needed.
Other Matters
The committee has access to sufficient resources in order to carry
out its duties, including access to the company secretary for
assistance as required;
The committee members are provided with training as and when
required, both in the form of an induction programme for new
members and on an ongoing basis for all members;
The committee may oversee any investigation of activities which are
within its terms of reference and act as a court of the last resort; and
At least once a year, review its own performance, constitution
and terms of reference to ensure it is operating at maximum
effectiveness and recommend any changes it considers necessary
to the Board for approval.
34 The Vitec Group Annual Report 2003 35
Authority
The committee is authorised to seek any information it requires
from any employee of the Company in order to perform its duties
and to obtain, at the Company’s expense, outside legal or other
professional advice on any matter within its terms of reference. It is
also authorised to call any employee to be questioned at a meeting
of the committee as and when required.
Remuneration committee
The members of the Remuneration committee and their biographical
details are set out on pages 18 and 19. The committee is chaired by
David Bell. During 2003, the committee met three times. The
Report of the Remuneration committee is set out on pages 23 to 29.
Duties of the committee:
• determining and agreeing with the Board the framework or
broad policy for the remuneration of the Company’s Chairman, 
the executive directors, the Company secretary and such other 
members of the executive management as it is designated to 
consider. The remuneration of the non-executive directors shall 
be a matter for the Board. No director or manager shall be 
involved in any decisions as to their own remuneration;
• in determining such policy, take into account all factors which it 
deems necessary. The objective of such policy shall be to ensure 
that members of the executive management of the Company are 
provided with appropriate incentives to encourage enhanced 
performance and are, in a fair and responsible manner,
rewarded for their individual contributions to the success of
the Company;
• reviewing the ongoing appropriateness and relevance of the 
remuneration policy;
• approving the design of, and determine targets for, any 
performance related pay schemes operated by the Company and 
approve the total annual payments made under such schemes;
• reviewing the design of all share incentive plans for approval by 
the Board and shareholders. For any such plans, determine 
each year whether awards will be made, and if so, the overall 
amount of such awards, the individual awards to executive 
directors and other senior executives and the performance 
targets to be used;
• determining the policy for, and scope of, pension arrangements 
for each executive director and other senior executives;
• ensuring that contractual terms on termination, and any 
payments made, are fair to the individual, and the Company,
that failure is not rewarded and that the duty to mitigate loss is 
fully recognised;
• within the terms of the agreed policy and in consultation with the 
Chairman and/or Chief executive as appropriate, determining the 
total individual remuneration package of each executive director 
and other senior executives including bonuses, incentive 
payments and share options or other share awards;
• in determining such packages and arrangements, give due 
regard to any relevant legal requirements, the provisions and 
recommendations in the Code, the new Code and the UK Listing 
Authority’s Listing Rules and associated guidance;
• reviewing and noting annually the remuneration trends across 
the Company or Group;
• overseeing any major changes in employee benefits structures 
throughout the Company or Group;
• agreeing the policy for authorising claims for expenses from the 
Chief executive and Chairman;
• ensuring that all provisions regarding disclosure of remuneration 
including pensions, as set out in the Directors’ Remuneration 
Report Regulations 2002, the Code and the new Code are 
fulfilled; and
• be exclusively responsible for establishing the selection criteria, 
selecting, appointing and setting the terms of reference for any 
remuneration consultants who advise the committee: and to 
obtain reliable, up-to-date information about remuneration in 
other companies. The committee shall have full authority to 
commission any reports or surveys that it deems necessary to 
help it fulfil its obligations.
Reporting Responsibilities
• The committee chairman reports formally to the Board on its 
proceedings after each meeting on all matters within its duties 
and responsibilities.
• The committee makes whatever recommendations to the Board it
deems appropriate on any area within its remit where action or 
improvement is needed.
Other Responsibilities
• The committee, at least once a year, reviews its own 
performance, constitution and terms of reference to ensure it
is operating at maximum effectiveness and recommend any 
changes it considers necessary to the Board for approval.
Authority
The committee is authorised by the Board to seek any information it
requires from any employee of the Company in order to perform its
duties. The committee is also authorised by the Board, in
connection with the committee’s duties, to obtain, at the Company’s
expense, any outside legal or other professional advice. Corporate governance continued
Nominations committee
The members of the Nominations committee and their biographical
details are set out on pages 18 and 19. The committee is chaired by
Will Wyatt. The committee is delegated authority by the Board to
deal with succession planning and making recommendations to the
Board on all new Board appointments. During 2003, the committee
met formally on one occasion.
Duties of the committee:
• regularly review the structure, size and composition (including 
the skills, knowledge and experience) required of the Board in 
the future compared to its current position and make 
recommendations to the Board with regard to any changes;
• give full consideration to succession planning for directors and 
other senior executives, taking into account the challenges and 
opportunities facing the company, and the skills and expertise 
needed on the Board in the future; 
• be responsible for identifying and nominating for the approval
of the Board, candidates to fill board vacancies as and when 
they arise;
• before appointment is made by the Board, evaluate the balance 
of skills, knowledge and experience on the Board, and, in the 
light of this evaluation prepare a description of the role and 
capabilities required for a particular appointment. In identifying 
suitable candidates the committee:
• uses open advertising or the services of external advisers to 
facilitate the search;
• considers candidates from a wide range of backgrounds; and
• considers candidates on merit and against objective criteria, 
taking care that appointees have enough time available to devote 
to the position;
• keep under review the leadership needs of the Company,
both executive and non-executive, with a view to ensuring
the continued ability of the Company to compete effectively in
the marketplace;
• keep up to date and fully informed about strategic issues and 
commercial changes affecting the company and the market in 
which it operates;
• review annually the time required from non-executive directors. 
Performance evaluation should be used to assess whether the 
non-executive directors are spending enough time to fulfil their 
duties; and
• ensure that on appointment to the Board, non-executive
directors receive a formal letter of appointment setting out
clearly what is expected of them in terms of time commitment, 
committee service and involvement outside board meetings.
The Committee also makes recommendations to the Board
concerning:
• formulating plans for succession for both executive and
non-executive directors and in particular for the key roles of 
Chairman and Chief executive;
• suitable candidates for the role of senior independent director;
• membership of the Audit and of the Remuneration committees, 
in consultation with the chairmen of those committees;
• the re-appointment of any non-executive director at the 
conclusion of their specified term of office having given due 
regard to their performance and ability to continue to contribute 
to the Board in the light of the knowledge, skills and experience 
required;
• the continuation (or not) in service of any director who has 
reached the age of 70;
• the re-election by shareholders of any director under the 
‘retirement by rotation’ provisions in the Company’s articles of 
association having due regard to their performance and ability to 
continue to contribute to the Board in the light of the knowledge, 
skills and experience required;
• any matters relating to the continuation in office of any director at
any time including the suspension or termination of service of an 
executive director as an employee of the Company subject to the 
provisions of the law and their service contract; and 
• the appointment of any director to executive or other office other 
than to the positions of chairman and chief executive, the 
recommendation for which would be considered at a meeting of 
the full Board.
Reporting Responsibilities
• The committee chairman reports formally to the Board on its 
proceedings after each meeting on all matters within its duties 
and responsibilities.
• The committee makes whatever recommendations to the Board it
deems appropriate on any area within its remit where action or 
improvement is needed.
Other
The committee, at least once a year, reviews its own performance,
constitution and terms of reference to ensure it is operating at
maximum effectiveness and recommends any changes it considers
necessary to the Board for approval.
Authority
The committee is authorised by the Board to seek any information it
requires from any employee of the Company in order to perform its
duties. The committee is also authorised by the Board, in
connection with the committee’s duties, to obtain, at the Company’s
expense, any outside legal or other professional advice.
36 The Vitec Group Annual Report 2003 37
Appointments and re-elections to the Board
The Chairman and the other non-executive directors are appointed
for an initial period of three years which, with the approval of the
Nominations committee and the Board, would normally be
extended for a further three years. In exceptional circumstances,
appointments of non-executive directors may be extended beyond
six years, with the approval of the Nominations committee and the
Board, if it is in the interests of the Group to do so. 
Under the Company's articles of association, each director is
required to be re-elected at the third annual general meeting
following that at which he or she was last elected or re-elected.
A new non-executive director, Nigel Moore, was appointed on 
1 March 2004. Mr Moore has also been appointed as a member 
of the Audit committee and it is intended that he will take over the
chairmanship of that committee in September. Mr Moore will be
proposed for election at the 2004 annual general meeting.
Alison Carnwath, the Chairman, and David Bell, the senior
independent director, both of whom are non-executive, have now
served for eight years and seven years, respectively. They have
significant business experience and detailed knowledge of the
Group and have been asked, and have agreed, to continue in their
current roles for a further period. However, as referred to in the
Chairman’s statement, a search process is taking place for a
successor to the Chairman with a view to making an appointment
during 2004.
Relations with shareholders
The Board recognises the importance of maintaining regular contact
with its shareholders to ensure that its businesses, strategy and
remuneration policies are understood and that any concerns are
addressed in a constructive way. The Board communicates with its
shareholders through a combination of public announcements
through the Stock Exchange, analyst briefings and press interviews
at the time of the announcements of the interim and the full year
results and, when appropriate, at other times in the year. The
executive directors also meet with investors from time to time during
the year. The annual general meeting offers a further opportunity for
the directors to meet with shareholders.
At meetings of shareholders, the level of proxy votes received,
together with the numbers of votes in favour, against and abstaining,
is announced after each resolution has been dealt with on a show of
hands. Separate resolutions are proposed for each issue upon
which shareholders are asked to vote.
The Company has complied with the requirement set out in the
Code in respect of shareholders' meetings to send the notice of
annual general meeting and related papers at least 20 working days
before the meeting. It will continue to comply with the requirement.
Internal control and risk management 
The Board is responsible for the Group's system of internal control
to safeguard shareholders’ investment and the company’s assets
(Code principle D.2). As part of its responsibility, the Board reviews
the effectiveness of its internal controls. The Group has systems and
procedures for internal control that are designed to provide
reasonable control over the activities of the Group and to enable the
Board to fulfil its legal responsibility for the keeping of proper
accounting records, safeguarding the assets of the Group and
detecting fraud and other irregularities. However, it is recognised
that it is in the nature of any business that business and commercial
risks must be taken and that for a business to succeed, enterprise,
initiative and the motivation of employees are key elements that
must not be unduly stifled. It is not the intention of the Group to
avoid all commercial risks and commercial judgements will have to
be made in the course of the management of the business.
Since its implementation of the recommendations of the Cadbury
Committee Code of Best Practice through the guidance published
by the Working Group on Internal Control in December 1994, the
Board has adopted a risk-based approach to establishing the
system of internal control. The application of Code principle D.2 and
the process followed by the Board in reviewing the effectiveness of
the system of internal control during the year (Code provision D.2.1)
is as follows:
• operating company management is charged with the
ongoing responsibility for identifying risks facing each of the 
businesses and for putting in place procedures to monitor and 
manage risks.
• the responsibilities of the chief executive officer and chief 
financial officer at each operating unit to manage risks within 
their businesses are periodically reinforced by Group executive 
management.
• major commercial, technological and financial risks are formally 
assessed during the annual long-term business planning process 
around mid-year. These plans and the attendant risks are 
reviewed by the Board.
• large capital projects, product development projects and 
acquisitions require Board approval.
• the process by which the Board reviews the effectiveness of 
internal control has been agreed by the Board and 
documented. This involves bi-annual reviews by the Board, of 
the major business risks of the Group together with the controls 
in place to manage those risks as reported to the Board by the 
chief executives of each division. In addition, at the end of each 
year, businesses formally review, in detail, all of their business 
risks and their internal controls, including finance, cash, IT, sales,
purchasing and logistics. They then prepare statements that 
describe the extent of their compliance with control objectives. 
These statements are approved by the chief executive officer and
chief financial officer of each operating unit and submitted to 
Group executive management for review. Any significant matters 
arising from this review are formally reported to the Board by the 
Finance director. The risk and control identification and 
certification process is monitored and periodically reviewed by 
group financial management.
• The Board has established a control framework within which the 
Group operates. This contains the following key elements:
• organisational structure with clearly defined lines of 
responsibility, delegation of authority and reporting 
requirements.
• defined expenditure authorisation levels. Corporate governance continued
• on-site and telephone conferencing operations reviews covering
all aspects of each business are conducted by Group executive 
management on a regular basis throughout the year.
• comprehensive system of financial reporting. The annual 
budget and long term plan of each operating company are 
reviewed in detail and approved by the executive directors. 
The Board approves the overall Group's budget and plans. 
Monthly actual results are reported against prior year and 
monthly budgets. Forecasts are revised where necessary but 
formally at least once every quarter. Any significant changes 
and adverse variances are questioned by the Group executive 
directors and remedial action is taken where appropriate. 
Group tax and treasury is co-ordinated centrally. There is 
weekly cash and treasury reporting to Group financial 
management and periodic reporting to the Board on the 
Group's tax and treasury position.
The Board considers that it has fully complied during the year and
up to the date of approval of the annual report and accounts with
the Code provision D.2.1 as set out in the Guidance for Directors on
the Combined Code, published by the Internal Control Working Party
of the Institute of Chartered Accountants in England and Wales.
The Group does not have an internal audit function. However, the
need for such a function is regularly reviewed (Code provision
D.2.2). The current conclusion of the Board is that an internal audit
function is not required given the scale, diversity and complexity of
the Group's activities. Where required, third party audit consultants,
independent from the companies’ external auditors, are used on
specific assignments. The Company believes it can access
professional ‘internal audit’ support in the relevant country more
effectively than by having an internal department. Two such
outsourced audits took place in 2003.
Going concern
The directors have made appropriate enquiries and consider that the
Group has adequate resources to continue in operational existence
for the foreseeable future. Accordingly, the directors continue to
adopt the going concern basis in preparing the accounts.
Statement of directors’ responsibilities
Company law requires the directors to prepare financial statements
for each financial year which give a true and fair view of the state of
affairs of the Company and of the Group and of the profit or loss for
that period. In preparing those financial statements, the directors
are required to:
• select suitable accounting policies and then apply
them consistently;
• make judgements and estimates that are reasonable
and prudent;
• state whether applicable accounting standards have been 
followed, subject to any material departures disclosed and 
explained in the financial statements; and
• prepare the financial statements on the going concern basis 
unless it is inappropriate to presume that the company and the 
group will continue in business.
The directors are responsible for keeping proper accounting records
which disclose with reasonable accuracy at any time the financial
position of the company and to enable them to ensure that the
financial statements comply with the Companies Act 1985. They
have general responsibility for taking such steps as are reasonably
open to them to safeguard the assets of the Group and to prevent
and detect fraud and other irregularities.
38 The Vitec Group Independent auditor’s report to the members
of The Vitec Group plc
Annual Report 2003 39
We have audited the financial statements on pages 40 to 70.
We have also audited the information in the directors’ remuneration
report that is described as having been audited.
This report is made solely to the company’s members, as a body,
in accordance with section 235 of the Companies Act 1985. Our
audit work has been undertaken so that we might state to the
company’s members those matters we are required to state to them
in an auditor’s report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone other than the company and the company’s members as
a body, for our audit work, for this report, or for the opinions we
have formed.
Respective responsibilities of directors and auditors
The directors are responsible for preparing the Annual Report and
the directors’ remuneration report. As described on page 38, this
includes responsibility for preparing the financial statements in
accordance with applicable United Kingdom law and accounting
standards. Our responsibilities, as independent auditors, are
established in the United Kingdom by statute, the Auditing Practices
Board, the Listing Rules of the Financial Services Authority, and by
our profession’s ethical guidance. 
We report to you our opinion as to whether the financial statements
give a true and fair view and whether the financial statements and
the part of the directors’ remuneration report to be audited 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 with the group is not disclosed. 
We review whether the statement on page 33 reflects the company’s
compliance with the seven provisions of the Combined Code
specified for our review by the Listing Rules, and we report if it does
not. We are not required to consider whether the board’s statements
on internal control cover all risks and controls, or form an opinion on
the effectiveness of the group’s corporate governance procedures or
its risk and control procedures.
We read the other information contained in the Annual Report,
including the corporate governance statement and the unaudited
part of the directors’ remuneration report, and consider whether it is
consistent with the audited financial statements. We consider the
implications for our report if we become aware of any apparent
misstatements or material inconsistencies with the financial
statements. 
Basis of audit opinion
We conducted our audit in accordance with Auditing Standards
issued by the Auditing Practices Board. An audit includes
examination, on a test basis, of evidence relevant to the amounts
and disclosures in the financial statements and the part of the
directors’ remuneration report to be audited. It also includes an
assessment of the significant estimates and judgements made by
the directors in the preparation of the financial statements, and of
whether the accounting policies are appropriate to the group’s
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 part of the directors’
remuneration report to be audited are free from material
misstatement, whether caused by fraud or other irregularity or error.
In forming our opinion we also evaluated the overall adequacy of the
presentation of information in the financial statements and the part
of the directors’ remuneration report to be audited.
Opinion
In our opinion:
• the financial statements give a true and fair view of the state of 
affairs of the company and the group as at 31 December 2003 
and of the profit of the group for the year then ended; and 
• the financial statements and the part of the directors’ 
remuneration report to be audited have been properly prepared 
in accordance with the Companies Act 1985.
KPMG Audit Plc
Chartered Accountants
Registered Auditor
London
1 March 2004 Consolidated profit and loss account
for the year ended 31 December 2003
Before 
exceptional 
items,
goodwill 
amortisation
& impairment
£m Notes
Exceptional 
Items 
£m
Goodwill 
amortisation
& impairment 
£m
2003
Total 
£m
2002
Restated
Total 
£m
40 The Vitec Group
(2)
Turnover 3
Existing operations 164.5 164.5 164.4
Acquisitions 5.9  5.9
Continuing operations 170.4 170.4 164.4
Discontinued operation 22.4 22.4 17.8
192.8 192.8 182.2
Cost of sales 4 (111.4) (111.4) (99.4)
Gross profit 81.4 81.4 82.8
Net operating expenses 4/5 (63.6) (1.9) (3.4) (68.9) (64.8)
Operating profit 3/6
Existing operations 18.2 (0.9) (3.1) 14.2 16.8
Acquistions (0.4) (1.0) (0.3) (1.7) –
Continuing operations 17.8 (1.9) (3.4) 12.5 16.8
Discontinued operations –– – – 1.2
17.8 (1.9) (3.4) 12.5 18.0
Profit on sale of fixed assets 5 – – – – 0.2
Loss on disposal of discontinued operations 21 – (3.0) – (3.0) –
Profit on ordinary activities before interest 17.8 (4.9) (3.4) 9.5 18.2
Net interest payable 24 (1.7) –– (1.7) (1.6)
Profit on ordinary activities before tax 16.1 (4.9) (3.4) 7.8 16.6
Tax on profit on ordinary activities 9 (6.4) 4.1  – (2.3) (9.1)
Profit on ordinary activities after tax
and for the financial year 9.7 (0.8) (3.4)  5.5 7.5
Dividends 10 (9.3) (9.3)
Retained loss for the year
transferred to reserves 23 (3.8) (1.8)
Basic earnings per share 11 13.6p 18.3p
Diluted earnings per share 11 13.5p 18.3p
Adjusted basic earnings per share 
(3)
11 23.9p 34.1p
(1)
Net operating expenses and cost of sales in the year ended 31 December 2002 have been restated following the re-categorisation to cost of sales of £5.3 million of variable 
warehouse and service costs within the Broadcast Services Division and £1.1 million of exchange gains previously classified as net operating expenses.
(2)
Net operating expenses in the year ended 31 December 2002 included £5.8 million of exceptional restructuring costs and £0.9 million of goodwill amortisation.
(3)
Adjusted basic earnings per share is presented as the Directors consider that this gives valuable additional information about the ongoing earnings performance of the Group.
There is no material difference between the Group's profit and loss account and the historical cost profit and loss account. Accordingly, no note of the historical cost 
profit and loss for the period has been presented.
(1) Balance sheets
as at 31 December 2003
2003
£m Notes
Group
2002 
£m
2003
£m
Company
2002
£m
Fixed assets
Intangible assets 12 10.1 11.0 – – 
Tangible assets 13 34.5 42.7 2.0 2.2
Investments 14 0.5 0.5 155.2 144.8
45.1 54.2 157.2 147.0
Current assets
Stocks 15 33.2 30.5 – –
Debtors 16 42.2 37.0 2.8 2.3
Cash at bank and in hand 24 15.6 16.1 4.0 2.3 
91.0 83.6 6.8 4.6
Creditors - due within one year 17 (37.3) (36.8) (52.6) (48.3)
Net current assets/(liabilities) 53.7 46.8 (45.8) (43.7)
Total assets less current liabilities 98.8 101.0 111.4 103.3
Creditors - due after more than one year 17 (26.1) (24.3) (26.0)  (24.0)
Provisions for liabilities and charges 19 (12.4) (13.8) (0.1) (0.1)
Net assets 60.3 62.9 85.3 79.2
Capital and reserves
Called up share capital 22 8.2 8.2 8.2 8.2
Share premium account 23 2.6 2.6 2.6 2.6
Capital redemption reserve 23 1.6 1.6 1.6 1.6
Revaluation reserve 23 1.5 1.5 0.9 0.9
Other reserves 23 – – 53.7 53.7
Profit and loss account 23 46.4 49.0 18.3 12.2
Shareholders’ funds - equity 60.3 62.9 85.3 79.2
Approved by the Board on 1 March 2004 and signed on its behalf
Alastair Hewgill
Director
Annual Report 2003 41 Consolidated statement of total recognised gains and losses
for the year ended 31 December 2003
2003
£m
2002 
£m
42 The Vitec Group
Reconciliation of movements in consolidated shareholders' funds
for the year ended 31 December 2003
2003
£m
2002
£m
Profit for the financial year 5.5 7.5
Exchange rate movements on foreign net investments (0.9) (2.5)
Total recognised gains and losses relating to the year 4.6 5.0
Profit for the financial year 5.5 7.5
Dividends (9.3)  (9.3)
Retained loss for the year (3.8) (1.8)
Exchange rate movements on foreign net investments (0.9) (2.5)
Goodwill previously written off included in profit for the financial year 2.1 –
New share capital subscribed – 0.1
Net decrease in shareholders' funds (2.6) (4.2)
Opening shareholders' funds 62.9 67.1
Closing shareholders' funds 60.3 62.9 Consolidated cashflow statement
for the year ended 31 December 2003
Notes 
2003
£m
2002
£m
Net cash inflow from operating activities 6 28.7 35.4
Returns on investments and servicing of finance
Interest received 0.2 0.3
Interest paid (2.0) (1.9) 
Net cash outflow from returns on investments servicing of finance (1.8) (1.6)
Tax Paid (10.8) (6.6)
Capital expenditure and financial investments
Purchase of tangible fixed assets (10.2) (10.0)
Sale of tangible fixed assets 2.4 3.9 
Purchase of fixed asset investments – (0.5)
Net cash outflow from capital expenditure (7.8) (6.6)
Acquisitions & disposals 
Purchase of subsidiary undertakings (6.4) (1.7)
Disposal of subsidiary undertakings 2.6 –
Equity dividends paid (9.3) (9.3)
Net cash inflow before financing (4.8) 9.6
Financing
Issue of shares – 0.1
Repayment of loans (1.9)  (12.0)
New unsecured loan
(1)
5.4 –
Net cash inflow/(outflow) from financing 3.5 (11.9)
Decrease in cash in the year 24 (1.3) (2.3)
(1)
New unsecured loans of £5.4 million were obtained by Alu srl prior to its sale and were transferred as part of the disposal of that business (see note 21).
Annual Report 2003 43 Notes to the accounts
44 The Vitec Group
1 Basis of presentation
The consolidated profit and loss account and balance sheets include the accounts of the Company and its subsidiary undertakings made up
to 31 December 2003. The accounts have been prepared in accordance with all applicable accounting standards under the historical cost
convention modified to include the revaluation of certain land and buildings.
2 Accounting policies
Basis of consolidation. The results of subsidiaries sold or acquired during the year are included in the accounts up to, or from, the date that
control passes, unless otherwise stated. 
For acquisitions which were made prior to 1 January 1998, the differences between the fair value of the consideration paid for investments
in subsidiaries or businesses and the fair value of their net assets at the date of acquisition was treated as purchased goodwill and was
written off directly against reserves.
For acquisitions made on or after 1 January 1998, purchased goodwill arising from the differences between the fair value of the consideration
paid and the fair value of the net assets acquired, as at the date of acquisition is capitalised in the balance sheet as an intangible asset. This
purchased goodwill is being charged to the profit and loss account through amortisation on a straight-line basis over its estimated useful life up
to a maximum of 20 years.
Impairment tests are carried out on the purchased goodwill arising on acquisitions that occurred in the preceding year or when a triggering
event occurs. Where necessary, provision is made for any impairment that has arisen.
Upon the disposal of businesses which have become part of the Group by acquisition, purchased goodwill previously written off to reserves, or
the unamortised portion of purchased goodwill remaining in the balance sheet as an intangible asset, is written off to the profit and loss account.
Turnover. Turnover, which excludes value added tax and sales between Group companies, represents the value of products and services
sold. Other than for long term contracts, the treatment of which is set out seperately below, revenue arising from product sales is recognised
when title passes to the customer which is upon delivery of the product.
Revenue arising from asset rental is recognised over the duration of the rental contract at the gross amount billed to the customer, where we
act as principal in the rental transaction.
Long term contracts. The amount of profit attributable to the stage of completion of a long term contract is recognised when the outcome of
the contract can be foreseen with reasonable certainty. Turnover for such contracts is stated at cost appropriate to the stage of completion
plus attributable profits, less amounts recognised in previous years. Provision is made for any losses as soon as they are foreseen. 
Contract work in progress is stated at costs incurred, less those transferred to the profit and loss account, after deducting foreseeable losses
and payments on account not matched with turnover.
Amounts recoverable on contracts are included in debtors and represent turnover recognised in excess of payments on account.
Foreign currencies. Transactions in foreign currencies with overseas customers and suppliers are converted at the average rates for the
months in which transactions occur. Profits and losses arising from the difference between these rates and contracted rates on forward
exchange contracts, which are set up as hedges against such sales and purchases, are recorded in cost of sales. Foreign trading profits and
cash flows are translated at the average rates for the year. Monetary assets and liabilities are translated at the year-end rates and the gains or
losses on translation are included in the profit and loss account. Differences on translation of investments in overseas companies are taken
directly to reserves.
Research and development. Expenditure on the Group's research and development projects is generally charged to the profit and loss account
in the year in which it is incurred. In certain specialised cases where a development project meets clearly defined criteria and the commercial
outcome can be assessed with reasonable certainty, development expenditure is capitalised. Such capitalised expenditure is amortised over the
life of the project.
Investments. Fixed asset investments are stated individually at cost less, where appropriate, provision for impairment in value. Current asset
investments are stated at the lower of cost and net realisable value. Cost includes, where appropriate, accrued interest.
Fixed assets and depreciation. Depreciation is provided at rates estimated to write off the cost or valuation of the relevant assets less their
estimated residual values by equal annual amounts over their expected useful lives. No depreciation is provided on freehold land. Other fixed
assets are depreciated at the rates indicated below:
Freehold and long leasehold buildings 2
1
/ 2% – 5% on cost or valuation
Short leasehold property over the remaining period of the lease
Plant and machinery 12
1
/ 2%– 25% on cost
Motor vehicles 25% – 33
1
/ 3% on cost
Equipment, fixtures & fittings 10% – 33
1
/ 3% on cost
Rental equipment 20% – on cost Annual Report 2003 45
Fixed assets are stated at cost except that, as allowed under FRS 15 ‘Tangible Fixed Assets’, on adoption of that Standard in the year ending
31 December 2000 when the book amounts of revalued land and buildings were retained. These book values are based on the previous
revaluation on 31 March 1989 and have not been subsequently revalued.
Stock and work in progress. Stock and work in progress is valued at the lower of cost and net realisable value, less progress payments. 
Cost includes materials, direct labour and production overheads incurred in bringing stocks and work in progress to their present location
and condition.
Capital instruments are stated in the balance sheet after the deduction of issue costs, which are charged to the profit and loss account over
the term of the debt.
Receipts and payments on interest rate instruments are recognised on an accruals basis over the life of the instrument. Cash flows
associated with derivative financial instruments are classified in the cash flow statement in a manner consistent with those of the
transactions being hedged.
Deferred tax. The charge for taxation is based on the profit for the year and takes into account tax deferred because of timing differences
between the treatment of certain items for tax and accounting purposes. Full provision for deferred tax is made, on an un-discounted basis,
where there is an obligation to pay more tax, or a right to pay less tax, in the future. Deferred tax assets are recognised to the extent that it is
regarded as more likely than not that they will be recovered.
Pension costs. The costs of providing pensions for employees under defined benefit pension schemes are charged to the profit and loss
account over the working lives of the employees in accordance with the recommendations of qualified actuaries. Any funding surpluses or
deficits that may arise are amortised over the average working life of the employees but surpluses may first be used to improve members'
benefits. The costs of providing pensions for employees under state and other defined contribution schemes are expensed as incurred.
FRS 17 “Retirement benefits”. This Standard replaces use of actuarial values for assets in a pension scheme in favour of a market-based
approach. In order to cope with the volatility inherent in this measurement basis, the Standard requires that the profit and loss account
shows the relatively stable ongoing service cost, interest cost and expected return on assets. Fluctuations in market values and changes in
actuarial assumptions are reflected in the statement of total recognised gains and losses. The Group has continued to account for pensions
and other post employment benefits in accordance with SSAP 24 but has complied with the transitional disclosure requirements of FRS 17.
Employee share schemes. The costs of awards to employees that take the form of shares or rights to shares (including conditional rights) are
recognised over the periods to which the employees' performance relates. No cost is recognised in respect of SAYE schemes that are offered
on similar terms to all or substantially all employees.
Leases. Rentals under operating leases are charged to the profit and loss account on a straight-line basis.
Assets held for short-term rentals are recorded as plant and machinery within fixed assets and depreciated over their estimated useful lives.
Rental income from these assets is recognised as earned on a straight-line basis over the rental periods.
3.1 Class of business
Broadcast Systems 3.9 8.4 81.9 75.7 35.9 31.4
Photographic 13.9 14.2 61.5 59.2 29.4 17.0
Broadcast Services – 0.9 27.0 29.5 15.7 20.5
17.8 23.5 170.4 164.4 81.0 68.9
Goodwill amortisation and impairment
(1)
(3.4) (0.9) – – – –
Exceptional items
(2)
(1.9) (5.8) – – –
12.5 16.8 170.4 164.4 81.0 68.9
Discontinued operation
(3)
– 1.2 22.4 17.8 – 12.3
12.5 18.0 192.8 182.2 81.0 81.2
Group net liabilities
(4)
(20.7) (18.3)
60.3 62.9
3 Activity analysis Operating
profit
2002
£m
2003
£m
2003
£m
Turnover 
2002
£m
2003
£m
Net assets
2002
£m Notes to the accounts continued
46 The Vitec Group
3.2 Geographic area by origin
United Kingdom (2.8) (4.1) 31.0 21.6 14.6 9.7
The rest of Europe 13.7 17.2 56.4 58.2 29.2 16.1
The Americas 6.7 9.7 83.0 81.9 35.9 41.7
Asia and Australasia 0.2 0.7 – 2.7 1.3 1.4
17.8 23.5 170.4 164.4 81.0 68.9
Goodwill amortisation and impairment
(1)
(3.4) (0.9) – – – –
Exceptional items
(2)
(1.9) (5.8) – – –
12.5 16.8 170.4 164.4 81.0 68.9
Discontinued operation
(3)
– 1.2 22.4 17.8 – 12.3
12.5 18.0 192.8 182.2 81.0 81.2
Group net liabilities
(4)
(20.7) (18.3)
60.3 62.9
(1)
Goodwill amortisation relates to the United Kingdom - £0.3 million (2002: £nil), The rest of Europe - £0.1 million (2002: £0.1 million) and The Americas - £0.9 million 
(2002: £0.8 million) and impairment losses relate to The Americas - £2.1 million (2002: £nil). 
The net book value of goodwill relates to the United Kingdom £2.7 million (2002: £0.5 million), The rest of Europe - £1.8 million (2002: £1.9 million) and 
The Americas - £5.1 million (2002: £7.9 million).
(2)
Exceptional items relate to United Kingdom - £1.9 million (2002: £0.6 million), The rest of Europe - £nil (2002: £4.3 million) and The Americas - £nil (2002: £0.9 million).
(3)
The discontinued operation is the Retail Display business which was sold on 30 December 2003 (see note 21). Operating profit, Turnover and Net assets in the Retail 
Display business relate principally to the rest of Europe and The Americas.
(4)
Group net liabilities include net borrowings, capitalised goodwill, Group dividends payable and central creditors and provisions.
Operating
profit
2002
£m
2003
£m
2003
£m
Turnover 
2002
£m
2003
£m
Net assets
2002
£m
Notes relate to the table at the foot of page 45
(1)
Goodwill amortisation relates to Broadcast Systems - £0.7 million (2002: £0.4 million), Photographic - £0.1 million (2002: £0.1 million) and Broadcast Services - 
£0.5 million (2002: £0.4 million). Impairment losses of £2.1 million (2002: £nil) relate to Broadcast Services.
The net book value of goodwill relates to Broadcast Systems - £4.6 million (2002: £2.5 million), Photographic - £1.8 million (2002: £1.8 million) and Broadcast Services - 
£3.2 million (2002: £6.0 million).
(2)
Exceptional items relate to Broadcast Systems - £1.9 million (2002: £5.0 million) and Photographic - £nil (2002: £0.8 million).
(3)
The discontinued operation is the Retail Display business that was sold on 30 December 2003 ( see note 21). 
(4)
Group net liabilities include net borrowings, capitalised goodwill, Group dividends payable and central creditors and provisions.
3 Activity analysis (continued) Annual Report 2003 47
3.3 Turnover by destination
United Kingdom 9.1 8.0
The rest of Europe 44.7 39.9
The Americas 91.1 90.4
Asia and Australasia 21.5 21.9
Africa and Middle East 4.0 4.2
170.4 164.4
Discontinued operation
(1)
22.4 17.8
192.8 182.2
(1)
The discontinued operation is the Retail Display business which was sold on 30 December 2003 (see note 21).
Turnover in this business relates to the United Kingdom - £1.2 million (2002: £0.2 million), The rest of Europe - £8.0 million (2002: £10.3 million), The Americas 
£11.9 million (2002: £7.3 million), Asia and Australia - £0.8 million (2002: £nil) and Africa and Middle East - £0.5 million (2002: £nil).
2003
£m
Turnover
2002
£m
4 Cost of sales and operating expenses
Discontinued
£m
Continuing
£m
2003
Total
£m
Continuing
£m
Discontinued
£m
2002
Total
£m
Cost of sales 96.1 15.3 111.4 88.7 10.7 99.4 
Analysis of operating expenses
(1)
Distribution costs
– marketing, selling and distribution costs 27.5 3.0 30.5 24.5 2.7 27.2
– research, development and engineering costs 8.0 0.8 8.8 6.7 0.8 7.5
– amortisation of capitalised research and 
development expenditure 0.2 – 0.2 –––
35.7 3.8 39.5 31.2 3.5 34.7
Administrative expenses
– unsuccessful acquisition costs relating to 
EVS Broadcast Systems 0.9 – 0.9 –––
– exceptional restructuring costs 1.0 – 1.0 5.8 – 5.8
– goodwill amortisation and impairment 3.4 – 3.4 0.9 – 0.9
– other administrative expenses 20.8 3.3 24.1 21.0 2.4 23.4
26.1 3.3 29.4 27.7 2.4 30.1
Operating expenses 61.8 7.1 68.9 58.9 5.9 64.8
(1)
Net operating expenses and cost of sales in the year ended 31 December 2002 have been restated following the re-categorisation to cost of sales of £5.3 million of 
variable warehouse and service costs within the Broadcast Services Division and £1.1 million of exchange gains previously classified as net operating expenses. Notes to the accounts continued
48 The Vitec Group
2003
£m
2002
£m
The following items are included in operating profit
Operating lease rental income on owned broadcast equipment 17.8 16.8
Goodwill amortisation and impairment 3.4 0.9
Depreciation 11.3 12.2
Profit on sale of fixed assets (1.2) (1.5)
Operating lease rental expense
Plant, machinery and vehicles 0.1 0.1
Property 4.6 4.4
Auditor’s remuneration
Audit fees (company £0.1 million – 2002: £0.1 million) 0.4 0.4
Other fees paid to the auditor and its associates 1.6 1.1
Other fees paid to the auditor comprises tax advice £0.5 million (2002: £1.0 million); due diligence assistance on acquisitions 
£0.4 million (2002: £nil); acting as the Group’s reporting accountant £0.4 million (2002: £nil) and other £0.3 million 
(2002: £0.1 million).
2003
£m
2002
£m
Operating profit 12.5 18.0
Development costs amortisation 0.2 –
Goodwill amortisation and impairment 3.4 0.9
Depreciation 11.3 12.2
Profit on sale of fixed assets (1.2) (1.5)
(Increase)/decrease in stocks (3.4) 2.7
Increase in debtors (0.4) (4.3)
Increase in creditors 7.8 2.2
(Decrease)/increase in provisions (1.5) 5.2
Net cash inflow from operating activities 28.7 35.4
6 Operating profit
Reconciliation of operating profit to net cash flow from operating activities
5 Exceptional items
Exceptional items included in profit on ordinary activities before interest of £1.0 million relate to the closure of Radamec Broadcast Systems’
manufacturing factory at Chertsey, UK and £0.9 million of costs relating to the unsuccessful acquisition of EVS Broadcast Systems. No
related tax credit has been recognised on these costs.
Prior year exceptional items included in profit on ordinary activities before interest were £0.2 million profit on the sale of property fixed
assets (Photographic), and included in operating profit were restructing costs of £5.8 million (Broadcast Systems £5.0 million and
Photographic £0.8 million). A related tax charge of £0.1 million arose in respect of the sale of the property and a credit of £0.1 million was
recognised in respect of the restructuring costs. Annual Report 2003 49
Aggregate remuneration of all 
employees during the year
Wages and salaries 43.1 3.7 46.8 39.1 3.3 42.4
Employers’ social security costs 5.9 0.6 6.5 5.6 0.6 6.2
Employers’ pension cost 1.9 0.1 2.0 1.7 0.1 1.8
50.9 4.4 55.3 46.4 4.0 50.4
7 Employees
Average number of employees during the year
Broadcast systems 748 – 748 606 – 606
Photographic 587 – 587 548 – 548
Broadcast services 156 – 156 171 – 171
Head office 12 – 12 14 – 14
Discontinued business - Retail Display – 121 121 – 107 107
1,503 121 1,624 1,339 107 1,446
8 Directors’ remuneration
The emoluments, share options, awards under incentive schemes and pension entitlements of the directors are disclosed in the
Remuneration report on pages 23 to 29.
The combined remuneration of the directors of the Group is set out below
2003
£m
2002
£m
Fees for non-executive duties 0.2 0.2 
Remuneration for executive duties 0.5 0.8
0.7 1.0
Discontinued
£m
Continuing
£m
2003
Total
£m
Continuing
£m
Discontinued
£m
2002
Total
£m
Discontinued Continuing
2003
Total Continuing Discontinued
2002
Total Profit on ordinary activities before taxation 16.1 (8.3) 7.8 23.1 (6.5) 16.6
Notional charge at UK corporation tax rate of 30% 4.8 (2.5) 2.3 6.9 (2.0) 4.9
Profits in-tax free and low tax areas (0.5) – (0.5) (0.7) – (0.7)
Amortisation of intangible assets (0.7) 1.0 0.3 (1.0) 0.3 (0.7)
Higher overseas tax rates 1.9 – 1.9 1.8 – 1.8
Timing differences (0.2) – (0.2) (0.5) – (0.5)
Tax losses not recognised 1.6 0.6 2.2 2.0 1.7 3.7
Tax loss on disposal of business – (3.2) (3.2) __ _
Adjustments in respect of prior periods (0.2) – (0.2) 0.1 – 0.1
Other items – – – (0.2) – (0.2)
Current ordinary tax charge for the year 6.7 (4.1) 2.6 8.4 0.0  8.4 
Notes to the accounts continued
50 The Vitec Group
9 Tax
(a) Analysis of taxation charge in the year
UK corporation tax payable at 30% (2002: 30%) – – – 0.3 – 0.3
Less: Double taxation relief – – – (0.3) – (0.3)
–– – –– –
Overseas corporate tax 6.9 (4.1) 2.8 8.3 – 8.3
Adjustments in respect of prior years (0.2) – (0.2) 0.1 – 0.1
Total current tax 6.7 (4.1) 2.6 8.4 – 8.4
Overseas deferred taxation (0.3) – (0.3) 0.7 – 0.7
Taxation on profit on ordinary activities 6.4 (4.1) 2.3 9.1 – 9.1
(b) Factors affecting the current tax charge
Exceptional 
items, goodwill 
amortisation 
and impairment
£m
Before 
exceptional 
items, goodwill 
amortisation
and impairment
£m
2003 
Total 
£m
Before 
exceptional 
items, goodwill 
amortisation
and impairment
£m
Exceptional 
items, goodwill 
amortisation 
and impairment
£m
2002
Total 
£m
Exceptional 
items, goodwill 
amortisation 
and impairment
£m
Before 
exceptional 
items, goodwill 
amortisation
and impairment
£m
2003 
Total 
£m
Before 
exceptional 
items, goodwill 
amortisation
and impairment
£m
Exceptional 
items, goodwill 
amortisation 
and impairment
£m
2002
Total 
£m
(c) Factors that may affect future tax charges
A significant proportion of the Group's operating profits will continue to be earned in countries with a higher rate of tax than in the UK.
No deferred tax has been recognised on tax losses of £11.2 million (2002: £8.0 million) as these are not expected to be utilised in the
foreseeable future. Annual Report 2003 51
2003
£m
2002
£m
Interim paid of 6.1p per share (2002: 6.1p) 2.5 2.5
Final proposed 16.6p per share (2002: 16.6p) 6.8 6.8
Total dividends 22.7p per share (2002: 22.7p) 9.3 9.3
10 Dividends
11 Earnings per ordinary share
The calculation of basic earnings per share is based on profit after tax of £5.5 million (2002: £7.5 million) and on the weighted average
number of shares in issue during the year of 41,034,098 (2002: 41,008,348).
Adjusted basic earnings per share is presented as the directors consider that this gives a useful additional indication of the ongoing 
earnings performance of the Group.
This calculation is based on profit after tax but before exceptional items and amortisation and impairment of goodwill. In 2003 this profit 
was £9.7 million (2002: £14.0 million).
2003
£m
Profit
2002 
£m
2003
pence
Earnings
per share
2002
pence
Profit for the financial year 5.5 7.5 13.6 18.3
Add back: exceptional items 0.8 5.6 2.0 13.6
Add back: goodwill amortisation and impairment 3.4 0.9 8.3 2.2
Earnings before exceptional items and goodwill amortisation and impairment 9.7 14.0 23.9 34.1
The calculation of diluted earnings per share is based on profit after tax of £5.5 million (2002: £7.5 million).
The number of shares used to calculate the diluted earnings per share incorporates the weighted average number of shares in issue
41,034,098 (2002: 41,008,348) and the number of shares under option of 2,608,381 (2002: 2,678,405), shares from the total of potential
Long Term Incentive Plan awards of 447,209 (2002: 404,560), contingently issuable, and shares issuable under the Deferred Bonus Plan of
63,709 (2002: 20,127), as adjusted for a weighting factor between the average exercise prices of the share options and the average market
price of the Company’s shares during 2003. The number of shares used for the calculation is 41,198,148 (2002: 41,022,262).
Reconciliation of earnings and its effect on basic earnings per share and adjusted basic earnings per share Notes to the accounts continued
52 The Vitec Group
Cost
At 1 January 2003 14.0 0.7 13.3
Currency translation adjustment (0.9) – (0.9)
Additions
(1)
3.4 – 3.4
Disposal of subsidiary (0.3) – (0.3)
At 31 December 2003 16.2 0.7 15.5
Amortisation
At 1 January 2003 3.0 – 3.0
Currency translation adjustment (0.5) – (0.5)
Impairment charge
(2)
2.1 – 2.1
Charge for the year 1.5 0.2 1.3
At 31 December 2003 6.1 0.2 5.9
Net book value
At 31 December 2003 10.1 0.5 9.6
At 1 January 2003 11.0 0.7 10.3
12 Intangible fixed assets
Total
£m
Development 
Costs
£m
Goodwill
£m
(1)
Additions of £3.4 million in goodwill represent £2.6 million of goodwill arising on the acquisition of the shares of Radamec Broadcast Systems Limited in the UK, and  
the operating assets and certain of the liabilities of Radamec Inc in the US, on 18 February 2003, and £0.8 million of goodwill arising on the acquisition of the 
business of OConnor Engineering Laboratories, on 6 February 2003. 
Both the companies are reported within the Broadcast Systems division. (See note 20). The goodwill is being amortised over a period of 10 years.
(2)
The impairment charge is in respect of goodwill that arose on the acquisitions of Systems Wireless Limited and Moriah Audio Systems Inc, both in 1998.
The impairment review was performed using a discount rate of 10%. Total
£m
Land
and
buildings
£m
Plant 
machinery 
and
vehicles
£m
Equipment
fixtures
and
fittings
£m
Group
Cost or valuation
At 1 January 2003 103.2 22.3 63.9 17.0
Currency translation adjustments (1.7) 0.9 (2.7) 0.1
Acquisitions 0.2 – 0.2 –
Additions 10.2 1.1 6.8 2.3
Disposals - on divestment (9.2) (5.1) (3.0) (1.1)
Disposals - other (7.7) – (6.8) (0.9)
At 31 December 2003 95.0 19.2 58.4 17.4
Depreciation
At 1 January 2003 60.5 6.8 43.0 10.7
Current translation adjustment (1.3) 0.3 (1.6) –
Charge for the year 11.3 1.0 8.5 1.8
Disposals - on divestment (3.5) (0.7) (2.2) (0.7)
Disposals - other (6.5) (0.1) (5.7) (0.6)
At 31 December 2003 60.5 7.3 42.0 11.2
Net book value
At 31 December 2003 34.5 11.9 16.4 6.2
At 1 January 2003 42.7 15.5 20.9 6.3
13 Tangible fixed assets
The Group's land and buildings shown above at a revalued net book value of £1.7 million would have been stated under historical cost at
£0.7 million and a net book value of £0.2 million.
The revalued amount of the Group's land and buildings has been retained as allowed for by the transitional provisions set out in FRS 15
'Tangible Fixed Assets'Capital commitments for which no provision has been made in the accounts amount to £0.4 million (2002: £0.3
million) for the Group and £nil (2002: £nil) for the Company.
Plant, machinery and vehicles includes broadcast equipment rental assets with a cost of £27.8 million (2002: £31.7 million) and
accumulated depreciation of £17.9 million (2002: £17.2 million).
The fixed assets of the Company, comprising principally of land and buildings, at a cost of £3.4 million (2002: £3.3 million) and with
accumulated depreciation of £1.3 million (2002: £1.1 million) and net book value of £2.1 million (2002: £2.2 million) are included above.
During the year additions at cost were £nil and the depreciation charge was £0.2 million.
Annual Report 2003 53
2003
£m
Group
2002
£m
2003
£m
Company
2002
£m
Net book value of land and buildings
at cost or valuation comprise the following
Carried at cost 10.2 13.7 0.3 0.3 
Carried at valuation (open market basis - 31.3.1989) 1.7 1.8 1.7 1.8 
11.9 15.5 2.0 2.1
Freehold 11.2 14.5 1.7 1.8
Short Leasehold 0.7 1.0 0.3 0.3
11.9 15.5 2.0 2.1 Notes to the accounts continued
Total
£m
Investment
in own
shares 
£m
Investment
in other
shares 
£m
Loans
£m
54 The Vitec Group
Group
Cost
At 1 January 2003 3.7 0.5 3.2 –
Currency translation adjustment (0.3) – (0.3) –
At 31 December 2003 3.4 0.5 2.9 –
Provision
At 1 January 2003 (3.2) – (3.2) –
Currency translation adjustment 0.3 – 0.3 –
At 31 December 2003 (2.9) – (2.9) –
Net book value
At 31 December 2003 0.5 0.5 – –
At 1 January 2003 0.5 0.5 – –
Company
At 1 January 2003 144.8 0.5 84.6 59.7
Additions 11.0 – 5.0 6.0
Disposals (0.6) – (0.6) –
At 31 December 2003 155.2 0.5 89.0 65.7
14 Fixed assets investments
Investment at cost or written down value
The Group's investment in other shares represents a 10.3% investment in Intersense Inc. A full impairment provision of US$5.2 million was
made against this investment in the year ended 31 December 2001.
The Group's investment in own shares at 31 December 2003 represents 142,857 (2002: 142,857) ordinary shares held in respect of grants
under share option schemes. The market value of these shares at 31 December 2003 was £494,285 (2002: £396,000). Annual Report 2003 55
Principal subsidiaries
The Group's principal subsidiaries at 31 December 2003, all of which are 100% owned, are listed below.
Country of incorporation
Vitec Group US Holdings Inc USA
Vitec Luxembourg Holdings Sarl Luxembourg
Vitec Investments Limited England and Wales*
Broadcast systems
Anton Bauer Inc USA
Centro de Produccion Profesional CPP Limitada Costa Rica
Drake Electronics Limited England and Wales*
Radamec Broadcast Systems Limited England and Wales*
Sachtler Corporation of America USA
Sachtler GmbH & Co. KG Germany
Vinten Broadcast Limited England and Wales*
Vinten Inc USA
Vitec CC Inc (trading as Clear Com) USA
Photographic
Bogen Imaging Inc USA
Gitzo SA France
Gruppo Manfrotto srl Italy
Lino Manfrotto + Co. SpA Italy
Broadcast services
Bexel Corporation USA
* Indicates companies directly owned by the parent company
A complete list of subsidiary companies will be included in the next annual return.
2003
£m
Group
2002
£m
Raw materials and components 11.1 9.1
Work in progress 8.8 7.5
Finished goods 13.3 13.9
33.2 30.5
15 Stocks 17 Creditors
Notes to the accounts continued
2003
£m
Group
2002
£m
2003
£m
Company
2002
£m
56 The Vitec Group
Amounts falling due within one year
Trade debtors 28.2 28.5 ––
Amounts recoverable on long term contracts 1.0 1.0 ––
Amounts owed by subsidiaries – – 0.1 0.5
Other debtors 3.3 3.3 0.6 0.5
Tax recoverable 5.6 – 2.0 1.1
Prepayments and accrued income 2.1 2.3 0.1 0.2
40.2 35.1 2.8 2.3
Amounts falling due after one year
Prepayments and accrued income 1.0 1.0 ––
Other debtors 1.0 0.9 ––
2.0 1.9 ––
42.2 37.0 2.8 2.3
16 Debtors
2003
£m
Group
2002
£m
2003
£m
Company
2002
£m
Amounts falling due within one year
Other loans (unsecured) – 4.0 ––
Payments received on account 0.5 0.2 ––
Trade creditors 15.0 12.1 ––
Amounts owed to subsidiaries – – 43.0 40.3
Dividends 6.8 6.8 6.8 6.8
Corporation tax 1.7 5.0 ––
Other tax and social security cost 1.9 1.6 – 0.1
Other creditors 5.4 3.6 0.8 0.2
Accruals and deferred income 6.0 3.5 2.0 0.9
37.3 36.8 52.6 48.3
Amounts falling due after more than one year
Bank loans (unsecured) 26.0 24.0 26.0 24.0
Accruals and deferred income 0.1 0.3 ––
26.1 24.3 26.0 24.0 Annual Report 2003 57
18 Financial instruments
An explanation of the Group's treasury policy and controls is included in the Financial review on page 17. Short term debtors and creditors
have been omitted from all disclosures other than the currency profile.
2003
£m
Group
2002
£m
2003
£m
Company
2002
£m
(a) Financial Liabilities
i) Analysis of borrowings
Bank loans 26.0 24.0 26.0 24.0
Senior notes – 3.5 – –
Other loans – 0.4 – –
Swaps – 0.1 – 0.1
Gross financial liabilites 26.0 28.0 26.0 24.1
2003
£m
Group
2002
£m
2003
£m
Company
2002
£m
ii) Maturity profile
Within one year or less – 4.0 – 0.1
More than one year but not more than two years 26.0 – 26.0 –
More than two years but not more than five years – 24.0 – 24.0
26.0 28.0 26.0 24.1
2003
£m
2002
£m
Expiring in one year or less
– committed facilities – –
– uncommitted facilities 8.0 31.0
More than one year but not more than two years
– committed facilities 29.0 _
More than two years but not more than three years
– committed facilities – 31.0
Total 37.0 62.0
The Group has removed certain uncommitted overdraft facilities that were surplus to requirements.
The total amount of loans any part of which falls due after 5 years is £nil (2002: £nil).
The holding company for the USA subsidiaries, issued in 1993 via a private placement, US$40 million of 6.72% unsecured Senior Notes
2003 guaranteed by the Company. The notes were repaid in equal installments over 7 years commencing in 1997. The final instalment was
paid in September 2003. 
Concurrent with the drawdowns under the notes, the Company entered into 10 year US dollar/sterling interest rate swap agreements with
banks whereby US$15 million of fixed rate obligations were exchanged for obligations of £10.1 million at interest rates linked to LIBOR. The
obligations under the swap agreements were amortised in line with the underlying notes.
Certain foreign currency loans in Italy amounting to £0.3 million at 31 December 2002 were secured on the land and buildings of subsidiary
companies in Italy and were at fixed interest rates of 5.1-5.2%. These loans were repaid during 2003.
The Group had the following undrawn borrowing facilities at the end of the period Notes to the accounts continued
Total
£m
Floating rate
borrowing 
£m
Fixed rate
borrowing
£m
Fixed rate
weighted
average
interest
%
Fixed rate
weighted
average
period
Years
58 The Vitec Group
Sterling 26.0 26.0 –
US$ – – – ––
Euro –  – – – –
At 31 December 2003 26.0 26.0 –
Sterling 25.4 25.4–
US$ 2.2– 2.26.71.0
Euro 0.4– 0.45.11.0
At 31 December 2002 28.0 25.4 2.6 
The floating rate borrowings comprise bank loans bearing interest at rates based on LIBOR.
(b) Financial assets
Currency
Sterling (5.5) 2.5
US$ 10.2 7.3
Euro 10.2 5.2
Other 0.7 1.1
15.6 16.1
The floating rate financial assets comprise bank deposits bearing interest at rates based on local money market rates.
Sterling, US$ and Euro balances within the UK can be offset. At December 2003 Euro balances of £3.1 million and US$ balances of 
£4.0 million could be offset.
18 Financial instruments (continued)
iii) Interest rate profile
Currency
2003
£m
2002
Floating
rate
£m Annual Report 2003 59
Book
value
£m
2003
Fair
value
£m
Book
value
£m
2002
Fair
value 
£m
Cash at bank and in hand 15.6 15.6 16.1 16.1
Floating rate borrowing (26.0) (26.0) (25.3) (25.3)
Fixed rate borrowing – – (2.6) (2.6)
Swaps – – (0.1) (0.1)
(10.4) (10.4) (11.9) (11.9)
Market rates have been used to determine fair values.
Functional currency of group operation
Sterling – 1.4 0.8 (0.2) 2.0
Euro – 0.8 (0.3) 0.5 1.0
At 31 December 2003 – 2.2 0.5 0.3 3.0
Sterling – 0.1 0.1 (0.3) (0.1)
Euro 0.1 2.7 – 0.5 3.3
At 31 December 2002 0.1 2.8 0.1 0.2 3.2
(c) Fair value of financial assets and liabilities
(d) Foreign exchange hedging
Cost of sales include net gains of £2.9 million (2002: £1.1 million) arising from the difference between the exchange rates at which foreign
currency transactions are converted and the contracted rates on the forward exchange rate contracts, set up as hedges against such
transactions. When compared with their values at the exchange rates in effect on 31 December 2003, the cumulative unrecognised
aggregate gain on forward exchange rate contracts as of 31 December 2003 is £1.6 million (2002: £2.6 million). All of these unrecognised
gains relate to the year 2004. Because these contracts are put in place to hedge a portion of the underlying transactions, any net gain or
loss that may arise on these contracts over the forthcoming year will be more than compensated by the corresponding transactional gains 
or losses.
During the year forward option contracts selling US Dollars and purchasing Euros were taken out, covering the period August 2004 to June
2005. These totalled £8.4 million and the unrecognised gains on these options at 31 December 2003, based on the exchange rates on that
date, were £0.7 million. The Group’s foreign exchange hedging policy is set out in the Financial Review.
(e) Currency profile
The main functional (or “operating'') currencies of the Group are Sterling, US$ and Euro. The following analysis of net monetary assets and
liabilities, excluding cash and borrowings, shows the Group's currency exposures after applying the effects of forward contracts used to
manage currency exposure. Such net positions comprise the monetary assets and liabilities of the Group that are not denominated in the
functional currency of the operating units involved.
Sterling
£m
US$ 
£m
Euro
£m
Other 
£m
Total
£m Notes to the accounts continued
60 The Vitec Group
At 1 January 2003 13.8 3.8 5.2 3.4 1.4 0.1 0.1
Sale of subsidiary undertaking 0.3 0.5 – – (0.2) –
Currency translation adjustment 0.1 (0.3) 0.1 0.3 – – –
Transfers from current tax – – – – – – –
Profit and loss account 3.5 (0.3) 1.0 0.9 1.9 – –
Utilised in year (5.3) – (4.2)  (0.2) (0.9) – –
At 31 December 2003 12.4 3.7 2.1 4.4 2.2 0.1 0.1
Composition of deferred tax provision
Accelerated tax depreciation allowances 2.4 2.7 0.1 0.1
Other timing differences 1.3 1.1 – –
3.7 3.8 0.1 0.1
19 Provisions for liabilities and charges
Pensions
£m
Exceptional
restructuring
£m
Deferred
tax
£m
Total
£m
Group
Other
provisions 
£m
Total
£m
Company
Deferred
tax
£m
2003
£m
Group
2002
£m
2003
£m
Company
2002
£m
The exceptional restructuring charge of £1.0 million recognised in the profit and loss account in 2003 relates to the closure of Radamec
Broadcast Systems Limited’s manufacturing facility at Chertsey, UK.
The exceptional restructuring provision will be utilised in 2004 and 2005.
The pensions provision of £4.4 million (2002: £3.4 million) is to cover accrued statutory entitlements that will be paid to employees in Italy,
Germany and Japan when they leave the employment of the Group.
The remaining other provisions comprise warranty provisions of £0.7 million (2002: £0.8 million), property related provisions of £nil (2002:
£0.2 million) and the provision for the upgrade of retail units of £1.5 million (2002: £nil). These provisions are expected to be utilised in 2004. Annual Report 2003 61
Net Assets acquired
Intangible fixed assets 0.1 (0.1) – –
Tangible fixed assets 0.1 – – 0.1
Stocks 1.0 (0.1) (0.1) 0.8
Debtors 0.2 – – 0.2
Creditors (0.3) – – (0.3)
1.1 (0.2) (0.1) 0.8
Purchased goodwill (being amortised over ten years) 0.8
Total cost of acquisition, including expenses, satisfied by cash 1.6
The policy alignment adjustments relate to the alignment of accounting polices for stock provisions and the capitalisation of intangibles 
with those of the Group.
Net outflow of cash in respect of acquisitions
Total cost of acquisitions including expenses 1.6
Net cash acquired _
Total outflow of cash from Group 1.6
The results of OConnor have been included in the Broadcast Systems Division and comprise
Turnover 1.8
Cost of sales (1.1)
Operating expenses (0.8)
Operating loss before goodwill amortisation and impairment (0.1)
OConnor made a loss after tax of US$0.2million in the period from 1 May 2002 to 6 February 2003 and a loss after tax of 
US$0.3 million in the year ended 30 April 2002.
20 Acquisitions of businesses
On 6 February 2003, a subsidiary of the Group purchased the trade, assets and certain liabilities of OConnor Engineering Laboratories from
Autocue Inc for a cash consideration of US$2.7 million (£1.6 million).
The acquisition was funded from existing cash resources and has been accounted for using the acquisition method of accounting.
Policy
alignment
£m
Book
value
£m
Fair value
adjustments
£m
As
adjusted
£m
£m Notes to the accounts continued
62 The Vitec Group
Net Assets acquired
Intangible fixed assets 0.3 (0.3) – –
Tangible fixed assets 0.1 – – 0.1
Stocks 2.5 (0.3) (0.5) 1.7
Debtors 0.9 – – 0.9
Creditors (0.6) 0.1 – (0.5)
3.2 (0.5) (0.5) 2.2
Purchased goodwill (being amortised over ten years) 2.6
Total cost of acquisition, including expenses, satisfied by cash 4.8
The policy alignment adjustments relate to the alignment of accounting polices for stock and the capitalisation of intangibles with those of
the Group.
Net outflow of cash in respect of acquisitions
Total cost of acquisitions including expenses 4.8
Net cash acquired _
Total outflow of cash from Group 4.8
The results of Radamec Broadcast Systems Limited have been included in the Broadcast Systems division and comprise
Turnover 4.1
Cost of sales (2.9)
Operating expenses (1.5)
Operating loss before goodwill amortisation (0.3)
Radamec Broadcast Systems Limited made a loss after tax of £nil in the period from 1 January 2003 to 18 February 2003 and a loss 
after tax of £nil in the year ended 31 December 2003.
20 Acquisitions of businesses (continued)
On 18 February 2003, the Group acquired the whole of the share capital of Radamec Broadcast Systems Limited in the UK and acquired
the operating assets and certain liabilities of Radamec Inc in the USA for a combined cash consideration of £4.8 million.
The acquisition was funded from existing cash resources and has been accounted for using the acquisition method of accounting.
Policy
alignment
£m
Book
value
£m
Fair value
adjustments
£m
As
adjusted
£m
£m Annual Report 2003 63
21 Disposal of businesses
On 30 December 2003, the Group disposed of the the Retail Display business, for a consideration of £10.2 million, being £4.8 million cash,
and loan obligations transferred of £5.4 million.
Net Assets sold
Intangible fixed assets 0.3
Tangible fixed assets 5.7
Stocks 2.8
Debtors 7.0
Cash 1.2
Creditors (7.2)
Loan obligations transferred (5.4)
Provisions 0.3
Total net assets 4.7
Satisfied by
Cash 4.8
Less expenses (1.0)
Net consideration 3.8
Loss on disposal before writeback of goodwill (0.9)
Goodwill written back from reserves (2.1)
Net loss on disposal before tax (3.0)
Tax credit 4.1
Net profit on disposal after tax 1.1
Net inflow of cash in respect of the disposal
Net cash consideration 3.8
Cash disposed of with the business (1.2)
Net inflow of cash to the Group 2.6
£m Notes to the accounts continued
64 The Vitec Group
At 1 January 2003 41,021,786 8.2
Exercise of share options 15,515 –
At 31 December 2003 41,037,301 8.2
At 31 December 2003 the following options had been granted and remained outstanding under the Company’s share option schemes
United Kingdom SAYE schemes 288,465 231p – 595p 2004 – 2010
International SAYE schemes 371,409 231p – 633p 2004 – 2008
Executive schemes 1,546,510 257.5p – 694p 2004 – 2013
Premium option plan 401,997 793p – 819p 2004 – 2010
2,608,381
22 Share capital
The authorised share capital at 31 December 2003 consisted of 65,000,000 (2002: 65,000,000) shares of 20p each, of which 41,037,301
(2002: 40,985,752) were allotted and fully paid. The movement during the year was:
Shares
Issued
share
capital
£m
Exercise
prices
Number 
of shares
Dates 
normally
exercisable
On 27 March 2003, awards over an aggregate of 196,395 shares in the Company were made to six senior Group executives under the
Company's Long Term Incentive Plan. On 9 October 2003, awards over an aggregate of 3,357 shares were made to one senior Group
executive under the Company’s Long Term Incentive Plan. The total number of shares outstanding at 31 December 2003 under the
Company's long term incentive plan was 447,209 (2002: 404,560). The terms of the awards and the related performance conditions are
described in the Remuneration report.
On 13 June 2003, awards over an aggregate of 27,092 shares in the Company were made to three senior Group executives under the
Company's Deferred Bonus Plan. The total number of shares outstanding at 31 December 2003 under the Company's Deferred Bonus Plan
was 63,709. The terms of the awards and the related performance conditions are described in the Remuneration report. Annual Report 2003 65
Group
1 January 2003 2.6 1.6 1.5 – – 49.0
Retained loss for the year (3.8)
Exchange rate movement on
foreign net investments – – – – – (0.9)
Goodwill previously written off
included in retained profit for the year – – – – – 2.1
31 December 2003 2.6 1.6 1.5 – – 46.4
At 31 December 2003 the cumulative goodwill written off on acquisitions prior to 1 January 1998 amounted to £126.2 million 
(2002: £128.3 million).
Company
1 January 2003 2.6 1.6 0.9 9.7 44.0 12.2
Retained profit for the year – – – – – 6.9
Exchange rate movement on
foreign net investments – – – – – (0.8)
31 December 2003 2.6 1.6 0.9 9.7 44.0 18.3
23 Reserves
Revaluation
reserve
£m
Capital 
Redemption
reserve
£m
Share
Premium
account
£m
Merger
reserve
£m
Other
reserve
£m
Profit
and
loss
account
£m
Revaluation
reserve
£m
Capital 
Redemption
reserve
£m
Share
Premium
account
£m
Merger
reserve
£m
Other
reserve
£m
Profit
and
loss
account
£m
As permitted by Section 230 (4) of the Companies Act 1985 the Company has not presented its own profit and loss account. The amount of
the Group result for the financial year dealt with in the accounts of the Company was a profit of £16.2 million (2002: £2.4 million loss). 66 The Vitec Group
Notes to the accounts continued
Reconciliation of net cash flow to movement in net debt
Decrease in cash in the year (1.3) (2.3)
Net (receipt)/repayment of loans (3.5) 12.0
(Increase)/reduction in net debt resulting from cash flows (4.8) 9.7
Loans transferred on disposal of business 5.4 –
Exchange rate movement 0.9 0.9
Movement in net debt in the period 1.5 10.6
Net debt at 1 January (11.9) (22.5)
Net debt at 31 December (10.4) (11.9)
Analysis of net debt
Cash 16.1 (1.3) – 0.8 15.6
Debt after one year (24.0) (2.0) – – (26.0)
Debt due within one year (4.0) (1.5) 5.4 0.1 –
(28.0) (3.5) 5.4 0.1 (26.0)
Total (11.9) (4.8) 5.4 0.9 (10.4)
Interest
Bank loans and overdrafts 1.9 1.5
Other loans – repayable within five years – 0.5
Total payable 1.9 2.0
Interest receivable (0.2) (0.4)
Net interest payable 1.7 1.6
24 Cash and financing
2003
£m
2002
£m
2003
£m
2002
£m
Cash
flow
£m
1 January
2003
£m
Other
non–cash
£m
Exchange 
movements
£m
31 December 
2003
£m
(1)
Exchange rate movements result from the adjustment of opening balances and cash flows in the year to closing exchange rates.
(1) Annual Report 2003 67
25 Leasing commitments
At 31 December 2003 the Group had the following annual commitments under operating leases.
Total
£m
Other
£m
Land
and
buildings
£m
2002
£m
Expiring within one year 0.8 – 0.8 0.8
Expiring two to five years 1.5 – 1.5 2.8
Expiring after five years 0.2 – 0.2 0.4
2.5 – 2.5 4.0
(1)
Leasing commitments at 31 December 2002 comprised £3.9 million of land and buildings and £0.1 million of other commitments expiring between two and five years.
26 Pension commitments
During the year, the Group operated two funded defined benefit pension schemes set up under separate trusts and open to eligible
employees. The Company pays contributions to the fund in order to provide security for existing pensions and the accrued benefits of
current and former employees. At the end of the year, the Group closed both schemes to new members.
The adequacy of the schemes to meet the projected benefits is assessed by independent qualified actuaries at regular intervals. The most
recent actuarial valuations of the schemes, based on the projected unit method, were as at 5 April 2001. The schemes had assets with a
combined market value (excluding the value of insurance policies) of £28.0 million at that date.  On the basis of the assumptions adopted,
the value of the schemes' assets was equal to 108 per cent of the value placed on the benefits that had accrued to members allowing for
expected future increases in salaries. The surpluses arising are being spread over 14 years by way of variation from regular cost using the
straight-line method. 
The most significant actuarial assumptions were: investment return of 6.1% per annum in respect of liabilities for active members, and
5.1% per annum in respect of liabilities for deferred and current pensioners; price inflation of 2.5% per annum; general salary inflation of
4.5% per annum; pension increases of 2.5% per annum.
Company contributions to the schemes amounted to £0.8 million (2002: £0.7 million) for the year. On this basis, the pension charge for
2003 has been calculated as £0.9 million (2002: £0.8 million). There is a prepayment of £0.8 million (2002: £0.9 million) included in the
balance sheet, being the excess of the accumulated company pension contributions paid to the schemes over the amount charged to the
profit and loss account.
The disclosures required in relation to the transitional arrangements within FRS17 ‘Retirement Benefits’ have been based on the most
recent formal actuarial valuation as at 5 April 2001, updated to 31 December 2003, but using the following financial assumptions for the
purpose of FRS17:
Year ended 31 December
Price inflation 2.75 2.25
General salary and wage inflation 4.75 4.25
Increases to pensions in payment (in excess of GMPs) 2.75 2.25
Increases to deferred pensions 2.75 2.25
Discount rate 5.4 5.5
2003
% per
annum
2002
% per
annum
(1) 68 The Vitec Group
Notes to the accounts continued
26 Pension commitments (continued)
The assumptions used by the actuary are the best estimates chosen from a range of possible actuarial assumptions which, due to the
timescale covered, may not necessarily be borne out in practice.
The fair value of the schemes' assets, which are not intended to be realised in the short term and may be subject to significant change
before they are realised, and the present value of the schemes' liabilities are derived from cash flow projections over long time periods and
thus are inherently uncertain.
Scheme assets and expected rate of return
Year ended 31 December
Equities 19.38.2 16.3 8.2
Bonds 6.5 5.0 5.6 4.8
Property 1.2 7.1 1.4 6.9
Cash and net current assets 0.3 3.8 0.1 4.0
Total 27.3 7.3 23.4 7.3
Fair value
£m
2003
Expected rate
of return
%pa
Fair value
£m
2002
Expected rate
of return
%pa
Analysis of amounts charged to operating profit:
Current service cost 0.8 0.4 1.2 0.7 0.4 1.1
Total charged to operating profits 0.8 0.4 1.2 0.7 0.4 1.1
Analysis of the amount charged to other finance income:
Interest on pension scheme liabilities 1.0 0.5 1.5 1.0 0.5 1.5
Expected return on assets in the pension scheme (1.2) (0.5) (1.7) (1.4) (0.5) (1.9)
Net credit to other finance income (0.2) – (0.2) (0.4) – (0.4)
Total profit and loss charge before deduction for tax 0.6 0.4 1.0 0.3 0.4 0.7
Vitec Group
Executive
Pension
Scheme
£m
2002
Total
£m
2003
Total
£m
Vitec Group
Pension
Scheme
£m
Vitec Group
Pension
Scheme
£m
Vitec Group
Executive
Pension
Scheme
£m
Profit and loss charge for the year 2003 
(based on 31 December 2002 assumptions) 2003
£m
2002
£m
Analysis of amounts recognised in the Statement of total gains and losses
Actual return less expected return on pension scheme assets 2.1 (5.6)
Experience gains and losses arising on the scheme liabilities – 0.1
Changes in assumptions underlying the present value of the scheme liabilities (2.9) (0.2)
Actuarial loss recognised in Statement of total gains and losses before adjustment for tax (0.8) (5.7)
2002 2003
History of experience gains and losses 
a.  (Gain)/loss on plan assets
amount (£ million) (2.1) 5.6
% of plan assets at end of year 7.6% 23.4%
b.  Experience (gain)/loss on plan liabilities
amount (£ million) – (0.1)
% of plan liabilities at end of year 0.0% 0.4%
c.  Total actuarial loss recognised in Statement of total gains and losses
amount (£ million) 0.8 5.7
% of plan liabilities at end of year 2.4% 20.4%
The amount of the net pension liability would have a consequential effect on reserves. The assets and liabilities shown for the Vitec Group
Executive Pension Scheme include an amount of £0.5 million (2002: £0.5 million) in respect of certain insurance policies which meet part
of the benefit entitlement for some pensioners in the Scheme. The value placed on these insurance policies is in addition to the value of the
scheme’s investments.
Reconciliation to the balance sheets
Fair value of scheme assets 19.9 7.9 27.8 17.1 6.8 23.9
Actuarial value of scheme liabilities (23.0) (9.8) (32.8) (19.0) (8.9) (27.9)
Deficit in the scheme (3.1) (1.9) (5.0) (1.9) (2.1) (4.0)
Related deferred tax asset 0.9 0.6 1.5 0.6 0.6 1.2
Pension liability recognised
in balance sheet (2.2) (1.3) (3.5) (1.3) (1.5) (2.8)
2003
Total
£m
Vitec Group
Executive
Pension
Scheme
£m
Vitec Group
Pension
Scheme
£m
Vitec Group
Pension
Scheme
£m
Vitec Group
Executive
Pension
Scheme
£m
2002
Total
£m
Annual Report 2003 69 70 The Vitec Group
Notes to the accounts continued
26 Pension commitments (continued)
27 Related party transactions
During the year the following related party transactions took place.
Lino Manfrotto, a director of Lino Manfrotto + Co Spa, is president and shareholder of Mancor Spa, a company from which Gruppo
Manfrotto rents properties used in its business under operating leases that expire at the end of 2006. Abramo Manfrotto, who was Chief
Executive of the Photographic and Retail Display Division of The Vitec Group plc until the disposal of the Group’s Retail Display Division to
Manfrotto SA on 30 December 2003, is a non-executive director of Mancor Spa. Rents paid to Mancor in 2003 totalled b247,634,
£171,000 (2002: b242,719, £153,000). At 31 December 2003, there were no outstanding amounts payable to Mancor (2002: Nil). Lino
Manfrotto also owned part of a property known as the Campese property leased by Manfrotto + Co. Spa (see third paragraph). Rents paid to
Lino Manfrotto during the year totalled b68,629, £47,000 (2002: b67,000, £42,000). At 31 December 2003 there were no outstanding
rents payable to Lino Manfrotto (2002: nil).
Abramo Manfrotto is a shareholder and director of Antide Srl, a company specialising in worldwide web sites and e-mail services. Group
companies paid Antide a total of b100,944, £70,000 during the year (2002: b70,000, £44,000) for products and services. At 31 December
2003 Gruppo Manfrotto owed Antide b65,899, £44,000 (2002: b29,000, £19,000).
Abramo Manfrotto is also a shareholder of Antide Net Srl, a company specialising in IT consulting. Group companies paid Antide Net Srl a
total of bnil during the year (2002: b8,000, £5,000) for services. At 31 December 2002 there were no outstanding amounts payable to
Antide Net Srl.
During the year, Reco srl, a subsidiary of The Vitec Group plc that manages the Group’s Italian properties, purchased from Lino Manfrotto
that part of a property owned by him. The property, known as Campese, is in Bassano del Grappa, Italy and is the base for the Group’s
Italian operations. The consideration by Reco srl was £0.55 million plus any attributable Italian VAT.
Manfrotto SA, a company controlled by a trustee associated with Lino Manfrotto and Abramo Manfrotto, acquired the Group’s Retail Display
Division on 30 December 2003 (see note 21).
The purchase of part of the Campese property by Reco Srl and the sale of the Retail Display Division were approved by shareholders on 
29 December 2003.
28 Post Balance sheet event
On 8 January 2004, the Group acquired the domestic distribution activity of Multiblitz (Dr. Ing. D. A. Mannesmann GmbH & Co),
a distributor of the Group’s Manfrotto products in Germany, for b1.9 million (£1.3 million) cash.
Movement in scheme surpus/(deficit)
(Deficit)/surplus in schemes at beginning of year (4.0) 1.7
Movement over year:
Current service cost (1.2) (1.1)
Employer contributions 0.8 0.7
Other finance income 0.2 0.4
Actuarial loss (0.8) (5.7)
Deficit in schemes at end of year (5.0) (4.0)
2003
£m
2002
£m Five year financial summary
2003
£m
2002
£m
2001
(Restated)
£m
2000
£m
1999
£m
Turnover 192.8 182.2 190.4 200.0 171.4
Operating profit before exceptional items
and goodwill amortisation and impairment 17.8 24.7 30.6 40.1 38.2
Interest (1.7) (1.6) (2.6) (2.9) (1.1) 
Profit before tax, exceptional items
and goodwill amortisation and impairment 16.1 23.1 28.0 37.2 37.1 
Operating cash flow 28.7 34.9 42.1 45.8 51.1
Free cash flow
(2)
8.3 20.7 18.0 17.6 29.2 
Capital employed
Intangible fixed assets 10.1 11.0 10.8 10.9 10.0
Tangible fixed assets 34.5 42.7 48.5 47.0 37.5
Other net assets 29.8 24.9 34.5  38.5 27.7
Net cash – –– – – 
74.4 78.6 93.8 96.4 75.2 
Financed by
Shareholders’ funds – equity 60.3 62.9 67.1 63.7 44.2
Minority interest – –– – 0.9
Net debt 10.4 11.9 22.5 31.0 27.8 
Deferred tax 3.7 3.8 4.2 1.7 2.3
74.4 78.6 93.8 96.4 75.2 
Statistics
Operating profit (%) before exceptional items,
goodwill amortisation and impairment 9.3 13.6 16.1 20.1 22.3
Effective tax rate (%) 39.8 39.4 37.1 30.9 30.7
Adjusted basic earnings per share (p)
(3)
23.9 34.1 42.9 62.8 54.3 
Basic earnings per share (p) 13.6 18.3 32.9 56.7 53.3
Dividends per share (p) 22.7 22.7 22.7 21.2 18.5
Year-end mid-market share price (p) 346.0 277.5 425.0 498.0 527.0
(1)
On adoption of FRS 19 'Deferred Taxation' in 2002, it was not practical to restate 1999 and 2000.
(2)
Free cash flow is the cash inflow from operating activities less interest, tax and capital expenditure on tangible fixed assets.
(3)
Differences between Adjusted basic and Basic earnings per share arise from exceptional items in the years in question and, from 1999, the amortisation of goodwill.
(1)
Annual Report 2003 71 72 The Vitec Group
Shareholder information and financial calendar
Financial calendar
Annual general meeting 4 May 2004
Ex-dividend date for 2003 final dividend 21 April 2004
Record date for 2003 final dividend 23 April 2004
Proposed 2003 final dividend payment date 20 May 2004
Announcement of 2004 interim results September 2004
Proposed 2004 interim dividend payment date November 2004
Shareholder enquiries
For enquiries about your shareholding, such as dividends or loss of share certificate, please contact the Company’s registrars, Capita
Registrars, The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU, telephone 0870 162 3100 (UK only) or +44 (0)20 8639 2157
(overseas only).
Online services and electronic voting
Vitec has arranged with Capita Registrars to use its online services. By logging on to www.capitaregistrars.com and selecting Shareholder
Account Services you can make a transaction or dividend payment enquiry, add or change a dividend mandate or change your registered
address.
Capita Registrars also has an electronic voting facility. By logging on to www.capitaregistrars.com and selecting Shareholder Account
Services you will find details of the annual general meeting including the venue and text of the resolutions. Shareholders have the facility to
vote for, against or abstain and can split or restrict votes, appoint the Chairman of the meeting or a third party as their proxy and include any
instruction text. To do this, and to use the above facilities, shareholders will need to input a unique User ID that can be applied for on your
first visit to the site. To be allocated a User ID you will need your Investor Code, which can be found on your dividend stationery and share
certificates. User IDs previously issued will still be valid.
Should you experience any difficulties using these facilities please contact Capita Registrars on the numbers given above.
Share price information
The middle market price of a share of The Vitec Group plc share on 31 December 2003, the last dealing day of 2003, was 346p. 
During the year the share price fluctuated between 235p and 412.5p. The Company’s share price is available from the Group’s website
www.vitecgroup.com, with a 15 minute delay, and from the Financial Times web site www.ft.com with a similar time delay. Up-to-date 
market information and the Company’s share price are available from the Cityline service operated by the Financial Times by telephoning
0906 8434404.
Analysis of shareholdings as at 31 December 2003
Shares held Number of holders % of holders Number of shares % of Shares
Up to 1,000 863 57.99 358,612 0.88
1,001 to 5,000 380 25.54 883,694 2.15
5,001 to 10,000 72 4.84 525,357 1.28
10,001 to 50,000 75 5.04 1,928,490 4.70
50,001 to 100,000 30 2.02 2,323,602 5.66
100,001 and over 68 4.57 35,017,546 85.33
1,488 100.00 41,037,301 100.00
Institutions and companies 479 32.19 37,958,026 92.50
Individuals including directors and their families 1,009 67.81 3,079,275 7.50
1,488 100.00 41,037,301 100.00 Group directory
Main offices
Bogen Imaging
565 East Crescent Avenue
PO Box 506
Ramsey
NJ 07446-0506
USA
Tel: +1 (201) 818 9500
Fax: +1 (201) 818 9177
www.bogenimaging.us
Manfrotto
Via Sasso Rosso n19
PO Box 216
I-36061 Bassano del Grappa
Italy
Tel: +39 (0424) 555855
Fax: +39 (0424) 808999
www.manfrotto.com
Gitzo
Créteil Parc
8/10 rue Sejourné
94044 Créteil Cedex
France
Tel: +33 (1) 4 513 1860
Fax: +33 (1) 4 377 1505
www.gitzo.com
IFF
Via Vittorio Emanuele 32
I-50041 Calenzano
Firenze
Italy
Tel: +39 (055) 882 6351
Fax: +39 (055) 882 6355
www.iff.it
Litec
Via Venier 52
30020 Marcon (Ve)
Italy
Tel: +39 (041) 596 0000
Fax: +39 (041) 595 1082
www.litectruss.com
Anton/Bauer
14 Progress Drive
Shelton
CT 06484
USA
Tel: +1 (203) 929 1100
Fax: +1 (203) 925 4988
www.antonbauer.com
Radamec Broadcast Systems
Brooklands Close
Sunbury on Thames
Middlesex
TW16 7AP
UK
Tel: +44 (0)1932 766300
Fax: +44 (0)1932 766301
www.radamecbroadcast.co.uk
Clear-Com
4065 Hollis Street
Emeryville
CA 94608
USA
Tel: +1 (510) 496 6666
Fax: +1 (510) 496 6699
www.clear-com.com
Vinten Broadcast
Western Way
Bury St Edmunds
Suffolk
IP33 3TB
UK
Tel: +44 (0)1284 752121
Fax: +44 (0)1284 750560
www.vinten.com
Drake Electronics
7400 Beach Drive
Cambridge Research Park
Waterbeach
Cambridge
CB5 9TP
UK
Tel: +44 (0)1223 815000
Fax: +44 (0)1223 815001
www.drake-uk.com
Sachtler
Gutenbergstrasse 5
D-85716 Unterschleissheim
bei Munchen
Germany
Tel: +49 (89) 3215 8200
Fax: +49 (89) 3215 8227
www.sachtler.com
Audio Specialties Group / Bexel
Bexel Broadcast Services (BBS), Broadcast Video Gear (BVG), Digital Cinema Rentals (DCR), 
Intercom Specialties (ICS), Systems Wireless (SWL) 
801 South Main Street
Burbank 
CA 91506
USA
Tel: +1 (818) 841 5051
Fax: +1 (818) 841 1572
www.a-s-group.com
www.bexel.com
Photographic
Broadcast Services
Broadcast Systems
2003 has seen significant progress on our ‘Consolidate-Leverage-
Grow’ strategy. While the emphasis has been on consolidation,
the benefits of our recent investments in R&D are beginning to
come through with continuing volume growth in Photographic
and encouraging projects in Broadcast. 
Despite falling TV audience figures in the US, there are signs of
an upturn in advertising there. In addition, photographic demand
remains strong and we expect this to continue during 2004.
However, we expect currency movements to continue to have 
a negative effect on the Group.
Accounts 2003 00
Consolidated profit and loss account 40
Balance sheets 41
Consolidated statement of total recognised gains and losses 42
Reconciliation of movements in shareholders’ funds 42
Consolidated cash ﬂow statement 43
Notes to the accounts 44
Five year financial summary 71
Shareholder information and financial calendar 72
Group directory IBC
The year in review 01
At a glance 02
Chairman’s statement 06
Chief executive’s review 08
Divisional reports 00
Photographic 10
Broadcast systems 12
Broadcast services 14
Financial review 16
Board of Directors 18
Directors’ report 20
Remuneration report 23
Corporate social responsibility report 30
Corporate governance 33
Independent auditor’s report 39
Broadcast
Engineering 
magazine’s Pick
Hit Award for
Drake’s FreeSpeak
Digital TV Magazine’s
Editors’ Pick of Show
Award at NAB for
Vinten’s Fibertec
The Vidy Award
at NAB for
Vinten’s Fibertec
Government Video
Magazine’s Salute
2003 Award at NAB
for Vinten’s Fibertec
Audio Award at PLASA
for Clear-Com’s
CellCom
TV Technology
Europe’s Star Award at
IBC for Anton/Bauer’s
Stasis and for
Chromaflex (a product
distributed by Bogen)
The prestigious
Peter Wayne IABM
Award at IBC for
Technical Excellence
for Drake’s FreeSpeak
NAB Award for Innovation
in Media for ChromaFlex, 
a product distributed 
by Bogen
The prestigious
2003 Mario
Award at NAB
for Drake’s
FreeSpeak
Cover Picture Gitzo's new G1227LVL levelling tripod featuring a revolutionary centre column
angle and locking mechanism which allows for quick and accurate setup on uneven ground. Annual Report 2003
The Vitec Group plc Annual Report 2003
The Vitec Group plc
Group head office
One Wheatfield Way
Kingston Upon Thames
Surrey KT1 2TU
United Kingdom
tel +44 (0)20 8939 4650
fax +44 (0)20 8939 4680
email info@vitecgroup.com
web www.vitecgroup.com
Registered office
Western Way
Bury St Edmunds
Suffolk IP33 3TB
United Kingdom
Registered in England 
No 227691
Cartago, Costa Rica
Cambridge Research Park, UK
Designed by Millini. Printed by Beacon Press