Annual report and accounts  
2010
Acquire
 Integrate
 Grow
SpiriTel plc
18 King William Street
London EC4N 7BP
T +44 (0)20 7160 0100
F +44 (0)20 7929 5469
www.spiritelplc.com
SpiriTel plc Annual report and accounts 2010 SpiriTel plc at a glance
Complete business communications
SpiriTel is a rapidly growing provider of communications services to business 
customers. We offer an award winning range of converged voice, data and 
networking solutions to customers throughout the UK, utilising our nationwide 
network of sales and engineering staff. The Group is also a consolidator of 
the highly fragmented UK telecoms reseller market and has built a substantial 
customer base and operational scale through 12 selective acquisitions, 
all of which have been integrated into SpiriTel’s Business Division.
Strategy
Acquire 
SpiriTel is a consolidator of the fragmented 
UK telecoms reseller market. We acquire 
high quality businesses with attractive 
customer bases and grow through cost 
and revenue synergies. We expect 
all acquisitions to be immediately 
earnings enhancing.
Integrate 
The quick and efficient integration of 
our acquisitions, utilising our bespoke 
integration framework, is key to the rapid 
delivery of their earnings potential. Having 
completed 12 acquisitions, we have a track 
record of successful integration.
Grow 
SpiriTel has experienced rapid growth in 
revenues, earnings and customer numbers 
following the completion of 12 acquisitions. 
We have also delivered significant organic 
growth, despite challenging economic 
conditions, by selling more products and 
services to existing customers.
Business model Accreditations
 
Awards
IP 
Communications Mobile
Network  
Services
SpiriTel  Business
SpiriTel  plc
SpiriTel  
Technologies
Designed and produced by Radley Yeldar
www.ry.com 1	 SpiriTel	plc	Annual report and accounts 2010
Contents
1 Financial highlights
2 Chairman’s statement
3 Chief Executive’s review
1 1 Board of Directors
12 Report of the Directors
16 Directors’ remuneration report
19 Independent auditor’s report
20 Consolidated income statement
21   Consolidated statement of 
changes in shareholders’ equity
22  Consolidated statement 
of financial position
23  Consolidated statement  
of cash flows
24 Notes to the consolidated 
 financial statements
59 Company balance sheet
60 Notes to the Company 
 financial statements
69  Notice of Annual General Meeting
72  Company information and advisers
Acquisitions
5
Year to 30 April 2010
Glasgow
Wigan
London
Cardiff
Locations
We offer customers nationwide 
sales and engineering support 
from our offices in England, 
Wales and Scotland.
Edge Solutions Network Services
ADK Communications Network Services
Boucon Network Solutions IP Communications
Nessco IP Communications
MoboTel Mobile
Revenue £000 
13,649 16,674 19,718 21,284
2007 2008 2009 2010
Gross proﬁt £000 
2,036 6,415 7,631 8,579
2007 2008 2009 2010
Underlying EBITDA £000 
(861)
938 1,514 1,600
2007 2008 2009 2010
Customer numbers 
715 1,525 2,337 4,055
2007 2008 2009 2010 2	 SpiriTel	plc	Annual report and accounts 2010
Introduction
SpiriTel is fast developing into a business 
of genuine scale, delivering significant 
underlying profits. Although the results for 
the year under review do not reflect the full 
extent of our progress, I am delighted to 
report a period of further growth across all 
key operational and financial performance 
criteria. The Group successfully integrated 
five earnings enhancing acquisitions during 
the second half of the year to 30 April 2010 
and completed one further acquisition 
post year end. As a result, our current 
financial performance is far higher than 
the reported results. Importantly, we also 
generated significant organic growth of 15% 
from our proven strategy of cross selling 
our complete business communications 
portfolio to existing and acquired 
customers. Our value proposition 
continues to resonate with businesses 
and organisations operating in an era 
of austerity. 
Post year end almost 90% of revenues 
are attributable to our Business Division, 
which features a significant proportion of 
long-term contracts and the associated 
visibility of future earnings. In addition, we 
continue to benefit from the strong support 
of both Clydesdale Bank and Penta 
Capital, who were key in financing the initial 
turnaround of the Group and whose 
financial support during the year to 30 April 
2010 allowed us to achieve a further step 
forward in the performance and scale of 
the Group. Their ongoing financial support 
and backing of our management team will 
provide the springboard for us to continue 
to grow our share of the market.
SpiriTel’s value proposition was well 
illustrated by the recent award of a 
£5 million contract from Punch Taverns, 
to provide a converged voice and data 
service to 800 of their 7 ,100 UK sites. 
The contract win demonstrates that 
SpiriTel can now compete strongly in 
terms of price, technology and breadth 
of product offer and we believe that the 
Group remains well positioned to 
capitalise on improving market conditions. 
Results
Revenues for the year to 30 April 2010 
were up 8% year-on-year to £21.3 million 
(2009: £19.7 million). More significantly, 
Business Division revenues increased by 
71% which more than offset the previously 
indicated decline of Technologies Division 
revenues. SpiriTel Technologies is now 
focused on supporting the networking 
requirements of our rapidly growing 
Business Division. Underlying EBITDA* for 
the Group increased by 6% to £1.6 million 
(2009: £1.5 million), which masks a 70% 
rise in the Business Division Underlying 
EBITDA* to £3.1 million (2009: £1.8 million). 
SpiriTel Technologies Underlying EBITDA* 
declined from £1.1 million in the previous 
year to £0.1 million in the year to 30 April 
2010 and is no longer a significant 
contributor to Group earnings. The 
Group’s results include only part-year 
contributions from the five acquisitions that 
we completed during the year under 
review. In our interim results announced in 
January, we noted that the Business 
Division was delivering an annualised 
Underlying EBITDA* run rate in excess of 
£3.5 million and we are now trading 
significantly above this level. 
Dividend
SpiriTel is still pursuing its consolidation 
strategy and is continuing to invest 
any surplus funds into the business. 
The Directors are therefore not 
recommending the payment of a 
dividend for the year to 30 April 2010. 
Outlook
Whilst SpiriTel continues to operate in a 
challenging economic environment, we 
are realising the benefits of our increasing 
scale and a broad and innovative product 
set. These benefits are evident both in 
terms of the contracts we are winning and 
the Group’s ability to bolt-on acquisitions 
swiftly and efficiently with the cost and 
revenue synergies they bring. SpiriTel has 
a superb staff, all of whom have put in 
sterling work over the past year to open up 
pathways to growth at a time when general 
economic conditions have been less than 
favourable. The business continues to 
perform well in difficult times, significantly 
ahead of the reported results, and I am 
confident that we are well positioned to 
exploit the opportunities arising from the 
anticipated recovery of the wider economy.
Lord	St	John	of	Bletso
Chairman
27 September 2010
*Operating profit after adding back charges for 
depreciation, amortisation, share-based payments 
and exceptional costs.
Chairman’s	statement
“	 I	am	delighted	to	report	a	period	of	
further growth	across	all	key	operational	
and	financial	performance	criteria	and	
that	our	current	financial	performance	
is far	higher	than	the	reported	results.” 3	 SpiriTel	plc	Annual report and accounts 2010
Delivering 
outstanding 
service
SpiriTel	has	recently	been	awarded		
its	largest	contract	to	date	by		
Punch	Taverns	to	provide	a	multi-site	
converged	voice	and	data	service	to	
over	800	of	Punch’s	7,100	UK	sites.	
Under	the	terms	of	the	deal SpiriTel	
will	provide	a	wide	area	data	network	
and	hosted	IP	telephony	service,	
using	the	Group’s	award	winning	VoIP	
platform,	to	cover	5,000	connections	
across	Punch’s	managed	estate.	
As	a	pre-existing	client,	with	SpiriTel	
previously	providing	maintenance	
services	for	Punch’s	legacy	telephone	
IP Communications
systems	since	2008,	Punch	
recognised	SpiriTel’s	ability	to	deliver	
a	complex	solution	using	the	Group’s	
nationwide	technology	network.	
Punch’s	CIO	Bob	Broadbridge	
highlighted	that	his	company	was	
“very impressed with SpiriTel’s 
proposal, which gives us the technical 
solution we need, with a great service 
proposition and value for money.”	
He	went	on	to	say	that	Punch	“was 
also impressed with (SpiriTel’s) track 
record in the hospitality sector.”	 4	 SpiriTel	plc	Annual report and accounts 2010
Introduction
I am delighted to report that SpiriTel 
continues to move forward, driven by 
a strong performance from all segments 
of our Business Division. SpiriTel Mobile 
increased total connections by 39% 
to 16,500 during the year, and by  
a further 91% to 31,500 post year end 
as a result of the acquisition of Housing 
Communications Limited. The number 
of minutes per month carried by SpiriTel 
Networks increased 233% to a rate of 
14.2 million minutes per month by year 
end, whilst maintenance and hosted 
revenues in SpiriTel IP Communications 
increased 106% to a run rate of 
£3.3 million (2009: £1.6 million). 
This growth derived from a combination 
of acquisitions and an impressive 
15% organic growth rate, which was 
predominantly driven by cross selling. 
Our acquisitions, which are a key aspect 
of our tried and tested “Acquire, Integrate 
and Grow” strategy, have delivered a host 
of benefits in terms of customer numbers, 
engineering geographic coverage, sector 
breadth, product expertise and 
substantially increased revenues and 
profits. This increase in scale across the 
Group has also given us a greater ability 
to secure major contracts and we are 
increasingly able to win customers from 
much larger competitors. We now service 
4,200 corporate customers across 
England, Scotland and Wales and are 
proud that, despite our rapid growth, we 
continue to achieve market leading low 
customer churn rates.
Results
Despite trading in challenging economic 
conditions, and the fact that our results 
show only part year contributions for 
our five acquisitions, the results for the 
12 months to 30 April 2010 show real 
progress. Significantly, our key financial 
performance indicators demonstrate 
substantial improvement:
•  Revenues increased by 8% to 
£21.3 million (2009: £19.7 million)
•  Gross profit increased by 12.4% 
to £8.6 million (2009: £7 .6 million)
•  Underlying EBITDA increased by 5.6% 
to £1.6 million (2009: £1.5 million)
SpiriTel	Business
SpiriTel Business is the main focus of the 
Group and now represents 90% of 
revenues and 98% of Underlying EBITDA 
before central costs. During the year we 
continued to invest in growing the Division 
further and the results highlight the 
progress we have made. Although the 
headline numbers demonstrate significant 
progress, as previously mentioned, they do 
not represent the current performance of 
the Division which is significantly ahead of 
these levels. Our key financial results were:
•  Revenues increased by 71% 
to £17 .7 million (2009: £10.3 million)
•  Gross profit increased by 44.8% 
to £7 .9 million (2009: £5.4 million)
•  Underlying EBITDA increased by 70% 
to £3.1 million (2009: £1.8 million)
This is our first year of reporting separate 
financial results for the three principal lines 
of business that constitute SpiriTel 
Business. These are Mobile, Networks 
and IP Communications. Performance 
by line of business is described below 
in more detail.
Mobile
SpiriTel Mobile has achieved the 
highest level of accreditation as an 
O2 Centre of Excellence and provides 
mobile voice and data, including 
BlackBerry, services to business users. 
Almost all revenues are generated from 
contracts of 24 months or longer. SpiriTel 
Mobile acquired MoboTel Management 
Limited on 11 February 2010.
Mobile revenues increased by 47% 
to £4.897 million (2009: £3.340 million) 
largely by organic growth, with MoboTel 
contributing £510,000 to revenues during 
the last quarter of the year under review. 
Removing the MoboTel revenue reveals 
annual organic growth of 22%. The gross 
profit increase of 48% to £2.271 million 
(2009: £1.539 million) was commensurate 
with growth in revenues and improved to 
46.4% of revenues (2009: 46.1%). The 
acquisition of MoboTel allowed us to realise 
substantial cost savings as we were able 
Chief	Executive’s	review
“	 Despite	trading	in	challenging	economic	
conditions,	and	the	fact	that	our	results	
show	only	part	year	contributions	for	
our five	acquisitions,	the	results	for	
the 12 months	to	30	April	2010	show	
real progress.”
Revenue £000
• SpiriTel Business
• SpiriTel Technologies
2009 total: £19,718 2010 total: £21,284
52%
48%
83%
17% 5	 SpiriTel	plc	Annual report and accounts 2010 Chief	Executive’s	review	continued
Enhancing 
staff 
performance
HMV	came	to	SpiriTel	struggling		
to	divide	its	staff	time	adequately	
between	customer	service	and	
answering	the	phone.	The high 	
street	retailer	had	an	urgent	need		
to	establish	a	low	cost,	flexible		
means	of	dealing	with	customer		
calls,	identifying	call	patterns,	
understanding	reasons	for	calls	and,	
ultimately,	meeting	service	levels.	
SpiriTel	was	able	to	help	with	its	
Inbound	Call	Manager	–	a	simple	
web-based	tool	that	manages	
telephone	calls,	leaving	staff	free		
to	manage	customers.	
This	service,	provided	free	of	charge,	
allows	HMV	to	have	a	dedicated	
non-geographic	number	set	up	for	
each	store,	free	personalised	
call queuing	and	a	free	Interactive	
Voice	Response	(IVR)	system,	
a	feature	which	gives	callers	quick	
access	to	information,	or	an	
assistant,	with	a	click	on	the	keypad.	
Options	can	be	altered	instantly.	
In	addition	to	improving	the	customer	
experience	on	the	phone,	these	
services	have	also	made	an	impact		
on	the	quality	of service	in-store	by	
reducing	the	number	of	calls	that	
have	to	be	dealt	with	by	a	store	
colleague,	thereby	giving	the	store	
manager	more	opportunity	to	deal	
with	customers.	
It	has	been	well	received	by	HMV,	
whose	Customer	Contact	Manager	
Catherine	Santamaria	stated	that		
the	Inbound	Call	Manager	has	
“already been enormously important 
in improving call handling and 
customer service delivery.”	
Network Services 6	 SpiriTel	plc	Annual report and accounts 2010 Chief	Executive’s	review	continued
to rapidly incorporate most of their back 
office activities into our Wigan office.
Underlying EBITDA from Mobile grew 
by 74% to £879,000 (2009: £506,000). The 
operational gearing in our Mobile business, 
which allows us to increase revenues 
without commensurate increases to 
overheads, meant that Underlying EBITDA 
increased to a 17 .9% return on sales  
(2009: 15.1%). Operating profit increased 
by 69% to £526,000 (2009: £311,000) 
after deducting increased exceptional 
costs of £134,000 (2009: £6,000) incurred 
in relation to the acquisition and integration 
of MoboTel.
Networks
SpiriTel Networks provides fixed line 
telephony services, including inbound 
and outbound calls, line rental and 
broadband to business users. Almost 
all revenues from Networks are received 
under contracts which range from rolling 
monthly to five-year agreements. SpiriTel 
Networks acquired Edge Solutions 
Limited on 2 November 2009 and 
ADK Communications Limited on 
6 November 2009.
Networks revenues increased by 216% to 
£8.085 million (2009: £2.555 million) during 
the year by a combination of organic 
growth, achieved largely by cross sales 
into existing customers, and acquisition. 
Stripping out the revenue from acquisitions 
reveals annual organic growth of 32%.
The acquisition of Edge Solutions Limited 
added substantial scale and expertise to 
our Networks activities and allowed the 
swift integration of ADK Communications 
and the network activities of Nessco. 
The increased purchasing power of our 
Networks line of business and a focus 
on managed services allowed us to 
increase gross profit to 33.1% of revenues 
(2009: 32.3%). 
Underlying EBITDA from Networks grew 
by 288% to £1.410 million (2009: £363,000), 
a 17 .4% return on sales (2009: 14.2%). 
Operating profit increased significantly 
to £573,000 (2009: £459,000 loss).
IP	Communications
SpiriTel IP Communications provides 
a range of voice and data services to 
business customers, including hosted VoIP 
and WiFi, traditional telephony equipment, 
maintenance and structured cabling. 
A substantial part of revenues are generated 
under maintenance contracts, some of 
which are for three years, and hosted VoIP 
where contracts are for up to seven years. 
SpiriTel IP Communications acquired 
Boucon Network Solutions Limited on 
29 January 2010 and Nessco Limited 
on 18 March 2010. IP Communications 
supplies all business sizes, including large 
corporates and has particular expertise 
in the hospitality sector. The business also 
holds the highest level of Mitel accreditation.
IP Communication revenues increased 
by 5.3% to £4.656 million (2009: 
£4.420 million), with £732,000 of 
revenues from acquisitions offsetting 
a decrease of 10% in historic revenues. 
Gross profit decreased to £2.946 million 
(2009: £3.083 million) due to ongoing 
pricing pressure and revenue mix. 
Underlying EBITDA from IP 
Communications decreased to £773,000 
(2009: £930,000), a 16.6% return on 
revenues (2009: 21.0%). The operating loss 
of £237 ,000 (2009: £135,000 profit) was 
largely due to increased exceptional costs 
of £373,000 (2009: £203,000) incurred on 
the acquisition and integration of Boucon 
and Nessco. These results reflect the 
difficult trading conditions in the year 
under review and their adverse effects 
on pricing and on investment in voice 
and data equipment.
At Boucon and Nessco, acquired during 
the last quarter of the year under review, 
we were able to achieve substantial 
cost savings. Most of these were from 
relocating their office based functions 
to our Wigan office and reducing staff 
numbers. These savings and the full year 
earnings potential of Boucon and Nessco 
are not fully reflected in these financial 
statements. We have started the current 
financial year to 30 April 2011 with 
several substantial contract wins, including 
Punch Taverns, which will contribute 
materially to revenues and profits over the 
next few years. After a challenging period, 
IP Communications is now trading well and 
we expect it to make a strong contribution 
to Group profits in the current year.
SpiriTel	Technologies
The Group results were achieved in 
spite of SpiriTel Technologies revenues 
declining by 61% to £3.646 million 
(2009: £9.403 million) and Underlying 
EBITDA decreasing to £58,000 (2009: 
£1.103 million). The decline in SpiriTel 
Technologies has been highlighted in 
previous financial reports. In line with our 
strategic objectives, the Division is now no 
longer a significant component of Group 
revenues and profits. However, SpiriTel 
Technologies continues to provide 
wholesale call termination services to a 
“	 Our	Business	Division	growth	was	
derived	from	a	combination	of	
acquisitions	and	an	impressive	
15% organic	growth	rate.” 7	 SpiriTel	plc	Annual report and accounts 2010 Chief	Executive’s	review	continued
small number of carrier customers and, 
more importantly, provides network 
infrastructure and support to SpiriTel 
Business, for which it receives no revenue.
Central	costs
Central costs comprise the costs of  
SpiriTel plc, including the Board of Directors, 
group finance team and professional 
services including M&A activity. Our policy, 
whenever possible, is to charge costs 
directly to the relevant Division or line 
of business. 
Finance	costs
Finance costs include interest paid or 
payable in cash on bank debt and the 
convertible loan notes (“cash interest”) 
and non-cash finance costs recognised 
under IAS 39. Of the total finance costs  
of £10.128 million, total cash interest paid 
during the year was only £1.297 million of 
which £1.051 million was charged against 
profits. The balance of £8.768 million 
which has no cash requirement at any 
time, relates to finance costs recognised 
under IAS 39.
Taxation
The principal component of the tax 
credit is deferred tax of £432,000 (2009: 
£335,000) relating to intangible assets 
recognised on acquisitions. There was 
no current tax charge due to the Group 
having tax losses of £9.5 million, of which 
£8.9 million are not recognised as a 
deferred tax asset. Corporation tax paid of 
£456,000 and the corporation tax creditor 
of £72,000 are both almost entirely due to 
pre-acquisition liabilities.
Balance	sheet
During October 2009 we strengthened 
our balance sheet with the conversion 
into ordinary shares of £6.85 million 
of indebtedness to Penta Capital. 
This was followed by an injection of 
£10.0 million of new funding in 
November and December 2010, led 
by Penta Capital. This funding has been 
used, in conjunction with additional bank 
facilities, to complete the acquisitions 
referred to above. The £10.0 million of new 
funding was raised by issue of convertible 
loan notes repayable in 2014. The 
long-term maturity gives us greater 
certainty of future cash flows. The loan 
notes carry a 10% annual paid yield and  
a 20% redemption premium and are 
convertible at 40p per ordinary share. 
SpiriTel’s accounts are presented using 
IFRS accounting rules. Specifically, 
IAS 39 requires that the liability in 
respect of the £10.0 million convertible 
loan notes is stated on our balance sheet 
at £15.0 million, of which £5.0 million 
represents IAS 39 finance costs referred 
to above. The other component of IAS 39 
non-cash finance costs of £8.768 million is 
a charge of £3.768 million related to the 
modification of the conversion terms of the 
£6.85 million of debt that was converted 
during the year. 
During March 2010, at the time of the 
Nessco acquisition, we consolidated 
several loans from Clydesdale Bank into 
a single £8 million facility, of which 
£4.8 million was drawn at year end and 
the balance allocated to meet expected 
obligations in respect of deferred 
consideration and earn out agreements. 
The support of Clydesdale Bank has 
been instrumental in completing 12 
acquisitions over the past few years 
and they remain positive supporters 
of our strategy.
Strategy
SpiriTel’s strategy remains focused 
on the twin tracks of acquisition led 
growth complemented by organic 
growth derived from cross selling our 
integrated product portfolio to existing 
and acquired customers. Despite the 
continuing consolidation in our sector, the 
UK telecommunications market remains 
highly fragmented with few competitors 
able to provide the converged, IP-based 
services that customers are increasingly 
demanding. This provides the opportunity 
for us to further execute the Group’s 
“Acquire, Integrate, Grow” strategy. 
Having now reached a level of critical 
mass, we have the ability to extract a 
significant level of synergies from 
acquisitions and increase the return on 
our cost of investment. Further upside 
opportunity is derived from organic growth 
and cross selling.
At the heart of our progress this year 
has been our success in cross selling, 
powered by our ability to deliver integrated 
systems to customers at a reduced overall 
cost. This has allowed us to grow revenues 
despite the fact that, like all businesses, 
we currently face a challenging economic 
environment. This delivery of organic 
growth alongside an aggressive acquisition 
strategy is a key differentiator for SpiriTel 
amongst its competitors. Whilst many 
competitors aspire to deliver cross selling 
success, we have a proven record of 
delivery and it remains a key contributor 
“	 This	delivery	of	organic	growth	alongside	
an	aggressive	acquisition	strategy	is	a	key	
differentiator	for	SpiriTel.” 8	 SpiriTel	plc	Annual report and accounts 2010 Chief	Executive’s	review	continued
SpiriTel’s	six-year	partnership	with	
Voyage	is	a	prime	example	of	the	
Group’s	ability	to deliver	effective	
mobile	solutions	with	constantly	
competitive	tariff	levels,	and	has	
allowed	the	Staffordshire-based	
care provider	to	cut	its	mobile	
bills substantially.	
Six	years	ago,	rapid	expansion	
had left	Voyage	with	an	expensive	
Orange tariff	and	too	many	handsets.	
SpiriTel	first	managed	to	unravel	the	
contracts	of	a	neglected	mobile	
estate,	and	then	eliminated	
unnecessary	expenditure.	This	was	
achieved	by	moving	the	company	
to an	O2	business	package	and	
reducing	handset	costs	by	a	simple	
arrangement	involving	a	“managerial	
phone”	and	a	“non-managerial	
phone,”	the	latter	offering	minimal	
features	at	the	lowest	possible	cost.
Today,	SpiriTel	continues	to	manage	
Voyage’s	mobile	expenditure,	
providing	a	regular	refresh	on	the	
latest	tariffs	and	the	Group’s	role	in	
cost	management	is	very	important	
for	Voyage,	something	explained	by	
Matt	Davies,	Voyage’s	IT	Manager:	
“Cost management is always going to 
be important and SpiriTel’s approach 
to this issue is outstanding. We need 
partners like SpiriTel who understand 
our operations and help us with the 
ups and downs of an increasingly 
dynamic business.”
Keeping
everyone 
connected
Mobile 9	 SpiriTel	plc	Annual report and accounts 2010 Chief	Executive’s	review	continued
to our organic growth. During the year 
to 30 April 2010 we made a total of 325 
cross sales to 140 customers with 
aggregate contract values of over 
£4 million and this success has continued 
post year end, including a single £5 million 
contract signed in August. This was our 
largest ever contract award across any line 
of business – to provide a converged IP 
hosted voice and data service to 800 units 
of Punch Taverns’ UK estate. Punch is a 
pre-existing voice client which we were 
able to present with an integrated solution 
and win the contract against much larger 
competitors.
Our acquisitions during the year have 
borne out our continuing commitment 
to this strategy of targeted cross selling. 
We have bought a number of exciting 
businesses and, with the exception of 
Nessco, none of these had any sales 
of significance outside their single areas 
of core competence in either Mobile, 
Networks or IP Communications prior 
to acquisition. This presents us with an 
exciting opportunity to focus cross sales 
efforts on their respective client bases 
in the current year. In total, we have 
cross sold 547 products to 210 customers, 
representing only 5% of our total customer 
base, demonstrating the significant upside 
that exists for ongoing progress in this area.
Acquisitions
Aided by a £10 million fundraising led by 
our principal shareholder Penta Capital in 
November 2009, and an increased facility 
from Clydesdale Bank, SpiriTel completed 
the acquisition of five companies across 
each of the segments of SpiriTel Business 
during the year under review: Mobile, 
Networks and IP Communications. As well 
as increasing our scale and enhancing our 
product proposition in each of these areas, 
the newly acquired businesses each 
presented significant cross selling 
opportunities. The acquisitions comprised:
•  Edge Solutions Limited based in 
London, is a leading provider of voice 
and data services to almost 200 
corporate customers, which include 
Guoman Thistle, Boden and several blue 
chip financial institutions. Edge’s client 
base delivers a market leading average 
customer spend of over £2,000 per 
month, with an annual churn rate of less 
than 2%. Edge was historically focused 
on Network Services with minimal sales 
of Mobile and IP Communications 
products and services.
•  ADK Communications Limited based 
in Hertfordshire, is a provider of voice 
and data services to almost 300 SME 
customers with an above average 
customer spend of approximately £500 
per month. ADK had only focused on 
selling Network Services to its customers 
and the base presented a significant 
cross selling opportunity for our Mobile 
and IP Communications lines of 
business. 
•  Boucon Network Solutions Limited 
based in Cardiff, is a leading provider 
of Internet Protocol (IP) based telephony 
solutions and has Mitel Premier 
Partner status, the highest level of 
Mitel accreditation, which SpiriTel has 
possessed for several years. Boucon 
serves a high quality customer base 
including DVLA and several NHS Trusts 
and County Councils. Prior to our 
acquisition, Boucon focused exclusively 
on IP Communications products 
and services. 
•  MoboTel Limited is a specialist mobile 
voice and data reseller, based in 
London and has grown rapidly over the 
last five years to become one of the UK’s 
largest independent B2B suppliers of 
BlackBerry solutions with particular 
strength in the legal and financial sectors. 
MoboTel had not previously sold any 
Networks or IP Communications 
products and services.
•  Nessco Limited based near Glasgow, 
is a provider of IP Communications 
services and networks services to 
approximately 800 customers. Nessco is 
particularly strong in the healthcare, local 
government and hospitality sectors and 
its customers included NHS Highland, 
Aberdeen City Council and Macdonald 
Hotels. The base is a focus for cross 
selling our Mobile and Networks 
solutions in the current year.
In addition, post year end we acquired 
Housing Communications Limited, 
a mobile reseller based in Shropshire. 
HCL brings an exciting opportunity in the 
niche Housing Association market and 
has over 15,000 mobile connections. 
As with all our acquisitions, HCL did not 
have an integrated product offering and 
we are already talking to several of their 
large customers about the Networks and 
IP Communications services that SpiriTel 
is able to offer.
In a highly fragmented market we maintain 
a constant watch for earnings-enhancing 
acquisition opportunities that could add 
“	 SpiriTel	is	now	a	business	of	genuine	
scale and	one	of	the	country’s	larger	
independent	service	providers	to	
business	customers.” 10	 SpiriTel	plc	Annual report and accounts 2010 Chief	Executive’s	review	continued
either scale to an existing line of business 
and/or bring new product or service 
capabilities to the Group. Our track 
record of successful completion and swift 
integration puts us in a strong position 
to attract potential sellers of businesses. 
We are currently reviewing several potential 
targets, a number of which are larger 
companies than previously acquired.
Operations
SpiriTel is now a business of genuine 
scale and one of the country’s larger 
independent service providers to business 
customers. The Group’s customer base 
now comprises 4,200 businesses and 
public sector organisations across the 
UK. Number of customers is a key 
performance indicator for the Business 
Division and the current customer base 
is 80% larger than at 30 April 2009 and 
some 175% bigger than two years ago.
We continue to focus on providing the 
highest possible level of customer care 
and support which we have been able to 
deliver throughout another period of rapid 
growth by acquisition. In our Networks line 
of business, our churn for the year to April 
2010 was below 5% in comparison to 
several competitors which operate with 
attrition levels between 1% and 2% per 
month. For Mobile, our annual churn was 
also market leading at less than 8% 
against an industry average approaching 
20%. In a recent customer service review 
undertaken by O2, we were ranked 
second out of 13 partners in their Centre 
of Excellence channel. We are immensely 
proud of these impressive, market leading 
results and they reflect the hard work and 
dedication of the SpiriTel team. 
Since 30 April 2009, staff numbers have 
grown from 109 to 160 and we now 
have a nationwide sales and engineering 
presence, with offices in London, Cardiff, 
Wigan and Glasgow. Our technical 
operations and customer services 
continue to be based in Wigan and in 
the London headquarters. 
Fast and effective integration was a key 
focus for management during the year 
and continues to be a priority. We have an 
excellent track record of integration, having 
completed 12 acquisitions. Implementation 
of our bespoke integration framework, 
which has been developing since its 
introduction in 2007 , has been a key 
success factor. The results of this 
considerable experience have been 
evident with several companies being 
integrated ahead of plan. For example, 
one of our mobile acquisitions was 90% 
integrated within 11 working days and the 
integration process for the six companies 
acquired in the last 10 months is complete 
for four companies and overall is now 
more than 90% complete. We also have 
a thorough and targeted due diligence 
process that we use to identify cost 
synergies from each transaction, in 
advance of completion. The management 
teams have been successful in delivery 
of these synergies and during the last 
10 months, approximately £1.6 million 
of annual overheads have been taken 
out of acquired businesses.
Summary	and	outlook
The year to 30 April 2010 was a period 
of significant progress for SpiriTel. 
We continued our strategy of targeted 
acquisitions which bring immediate 
earnings enhancement. Combined 
with a sustained focus on cross-sell 
opportunities, these acquisitions have 
seen revenue and Underlying EBITDA 
rise substantially. These results will improve 
even further once a full year contribution 
from recent acquisitions and contract 
wins is included, as our current financial 
performance is significantly ahead of the 
reported results.
I remain confident in the Group’s strategy 
of increasing revenues and profits through 
acquisition led growth combined with 
organically generated growth from cross 
sales. This strategy has been executed 
successfully despite challenging market 
conditions. Our ability to drive cross 
sales from existing customers and new 
customers gained by acquisition is a key 
differentiator for the Group amongst its 
peers and one that offers significant upside 
for future organic growth.
SpiriTel has a well established, 
experienced and energised management 
team, and a highly skilled and committed 
staff who have together proved their 
ability to execute our strategy. We are 
increasingly seeing the fruits of their hard 
work in laying the foundations for sustained 
growth and I look forward to further 
nurturing this development over the 
coming year as we continue to deliver 
value for our stakeholders.
Alastair	Mills
Chief Executive 
27 September 2010
“	 I	remain	confident	in	the	Group’s	strategy	
of	increasing	revenues	and	profits	
through	acquisition	led	growth	combined	
with	organically	generated	growth	from	
cross	sales.” 11	 SpiriTel	plc	Annual report and accounts 2010
Board	of	Directors
Lord	St	John	of	Bletso	(53)	
Non-Executive Chairman
Anthony St John qualified as an attorney 
in South Africa. Since 1985 he worked 
as a stockbroker in the City and consulted 
to Merrill Lynch until 2008. He served as 
Managing Director at Globix, a managed 
services web-hosting business from 
1998–2002 and consulted to several IT 
companies. He is currently a member 
of the House of Lords select committee on 
communications and of the Parliamentary 
Information Technology Committee.
Alastair	Mills	(37)	
Chief Executive
Alastair joined SpiriTel in 2004 as Managing 
Director of Expo Communications, now 
part of the Technologies Division. Alastair 
joined from Telewest Communications, 
having previously worked in consultancy 
and corporate finance for KPMG. He 
has been CEO since 2005, when he 
commenced the restructure of the Group 
and subsequently the completion of 12 
acquisitions. In 2008, Alastair was a finalist 
in the Ernst & Young Entrepreneur of the 
Year Award.
Ronnie	Smith	(46)	
Chief Financial Officer
Ronnie qualified as a Chartered 
Accountant in 1988 with Arthur Young 
(now Ernst & Young) following graduation 
from The University of Glasgow. Ronnie 
has held senior finance roles in a number 
of listed and private equity backed UK 
and US businesses, including Sigma 
Aldrich Inc., ICN Biomedicals Inc., 
The Ritchie Group Plc and The Rope 
Company Group Limited.
Steven	Maine	(58)	
Non-Executive Deputy Chairman
Steven has extensive experience in the 
telecommunications and media sectors, 
having served as Chief Executive Officer  
of Kingston Communications Plc between 
1997 and 2003 and having previously held 
senior positions in the satellite and video 
communications businesses of BT Plc. 
Currently Chief Executive of Solaris Mobile,  
a pan-European, satellite-based mobile  
TV venture.
Steven	Scott	(45)	
Non-Executive Director
Steve is a Chartered Accountant, 
having trained with Arthur Andersen 
after graduating from the University 
of Glasgow. He is a founding Partner 
of Penta Capital LLP , a venture capital 
fund manager that has invested in SpiriTel. 
Prior to establishing Penta, he was a 
Director in The Royal Bank of Scotland’s 
private equity division. 12 SpiriTel plc Annual report and accounts 2010 
Report of the Directors 
 
The Directors submit their report and financial statements for the year ended 30 April 2010.  
Results and dividends 
The Group loss for the year after taxation amounted to £11,025,000 (2009: loss £934,000), after exceptional costs of £1,045,000 
(2009: £663,000).  
The Directors do not recommend the payment of a dividend (2009: £nil). 
Principal activities and review of business 
The principal activity is the provision of telecommunication services. 
SpiriTel is a business communications group which is taking advantage of the opportunities created by rapidly changing telecoms 
markets in the UK as the migration to Internet Protocol (IP) based services accelerates. The Group is a consolidator of the highly 
fragmented UK telecoms reseller market and is building a substantial customer base and scale through selective earnings-enhancing 
acquisitions. The Group is organised into two divisions, SpiriTel Technologies – focused on our infrastructure and IP products and 
services – and SpiriTel Business, which provides our fully integrated range of voice and data services directly to our business customers. 
SpiriTel offers a broad range of voice and data communications products and services to a customer base of small and medium sized 
enterprises and an increasing number of larger national and international organisations. We are a recognised leader in the provision 
of new, but proven, Voice over IP (VoIP) solutions that are firmly based on the old-fashioned service values which run throughout 
the Group. 
The Chairman’s statement and Chief Executive’s review on pages 2 to 10 provide further information about the Group’s principal 
activities, the business and financial and non-financial key performance indicators, including Gross profit percentage, Increase in 
EBITDA, new connections and customer churn rates. 
Key risks 
Economic downturn 
The success of the business may be affected by any downturn in the general economic environment. In particular, this could influence 
the availability of bank finance and the cost of that finance, customers’ willingness and ability to invest in capital goods, customer 
settlement patterns and the incidence of bad debts. 
In response to this risk, senior management aim to keep abreast of economic conditions. Effective relationships are established with the 
Group’s bankers and other debt providers and there are regular reviews of customers’ credit worthiness and debt levels.  
Product obsolescence 
Telecommunications is a fast moving market sector and the pace of technological change is rapid. As a result, products may become 
obsolete following the development and introduction of new technology. 
The Company maintains partnerships with those of its potential suppliers which it believes will keep it to the forefront of product 
development on a sustained basis and regularly monitors trends in technological advancement so as to anticipate and plan for 
future changes. 
Regulatory change 
Governmental agencies, in particular Ofcom, may seek to implement or amend regulations which could affect product pricing or the 
nature and scope of activities of major industry players, such as BT. Such action could affect the Group’s profitability either directly 
or indirectly. 
Currently, governmental regulation only affects the Technologies division and a limited number of products within the Networks line of 
business. The Directors constantly monitor regulatory change so as to mitigate this risk. 
Future prospects 
Future prospects are outlined in the Chairman’s statement and Chief Executive’s review at pages 2 to 10. 
Post balance sheet events 
Post balance sheet events are disclosed in note 29 to the Group financial statements. 
Political and charitable contributions 
No political contributions were made during the year (2009: £nil). Charitable contributions made during the year amounted to £10,000 
(2009: £8,000).  13 SpiriTel plc Annual report and accounts 2010 
 
Directors and their interests 
The Directors in office and their interests in the ordinary shares of the Company are shown below. None of the Directors has had any 
beneficial interest in the redeemable preference shares at any time. Each Director served throughout the year unless otherwise indicated. 
 Note 
Number  
30 April 
2010 
Number 
30 April
2009 
Lord St John of Bletso  18,233 1,823,333
A R Mills  14,900 1,490,000
R W Smith  6,250 625,000
D Anahory (resigned 4 August 2009)  – 5,625,000
S Maine  5,000 500,000
S Scott 1 14,556,212 313,819,845
A J Vose (resigned 20 December 2009)  – 45,703,600
Notes: 
1) S Scott’s interest is non-beneficial, as a Director of the manager of the Penta funds. 
As a result of a resolution passed by shareholders at a general meeting held on 30 October 2009, the Company’s ordinary shares were 
consolidated such that existing shareholders received one new ordinary share for each 100 ordinary shares held. The new ordinary 
shares have the same rights and are subject to the same restrictions as the existing ordinary shares. 
Employees 
The Group aims for fair reward and recognition for all employees.  
The Group has continued its practice of keeping employees informed of matters affecting them as employees and the financial and 
economic factors affecting the performance of the Group. 
Applications for employment by disabled persons are given full and fair consideration for all vacancies in accordance with their particular 
aptitudes and abilities. 
In the event of employees becoming disabled, every effort is given to retrain them in order that their employment with the Group may continue. 
It is the policy of the Group that training, career development and promotion opportunities should be available to all employees. 
Financial risk management objectives and policies 
The Group uses various financial instruments which include cash, bank overdrafts and other loan facilities and items such as trade 
debtors and trade creditors that arise directly from its operations. The main purpose of these financial instruments is to raise finance for 
the Group’s operations. 
The main risks arising from the Group’s financial instruments are liquidity risk, interest rate risk and credit risk. The Directors review 
and agree policies for managing each of these risks and they are summarised below. These policies have remained unchanged from 
previous years.  
Liquidity risk 
The Group seeks to manage financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets 
safely and profitably. The Group finances its investment in tangible fixed assets primarily through cash balances. 
Interest rate risk 
The Group finances its operations through a combination of cash balances and loans. The Group manages its exposure to interest rate 
fluctuations by entering into fixed rate agreements with the lender where possible.  
Credit risk 
The Group’s principal financial assets are cash and trade debtors. The principal credit risk arises from trade debtors. The Directors 
manage credit risk by setting limits for customers based on a combination of payment history and third party credit references. 
Credit limits, debtor ageing and collection history are reviewed by the finance department on a regular basis. 
Currency risk 
The Group has limited exposure to translation and transaction foreign exchange risk. 
The Directors’ interests in convertible secured loan notes issued by the Company are disclosed in note 28 to the consolidated  
financial statements.  14 SpiriTel plc Annual report and accounts 2010    Report of the Directors continued 
 
 
Supplier payment policy 
The Group’s policy, in relation to all its suppliers, is to settle the terms of payment when agreeing the terms of the transaction and to 
abide by those terms provided that it is satisfied that the supplier has provided the goods or services in accordance with the agreed 
terms and conditions. The Group does not follow any specific code or statement of payment practice. The number of days’ billings from 
suppliers outstanding at 30 April 2010 was 39 days (2009: 27 days). 
Corporate governance 
The Directors are committed to maintaining high standards of corporate governance. Although, as an AIM listed company, the 
Company is not required to comply with the provisions of the Combined Code, the Board recognises the importance of, and is 
committed to, ensuring that effective corporate governance procedures relevant to smaller listed companies are in place. 
The Board 
The Board consists of a Non-Executive Chairman, two Executive Directors and two Non-Executive Directors and meets approximately 
every four to six weeks throughout the year. 
The Board reviews the performance of the Company and its subsidiaries through the use of management accounts and other regular 
reports and information presented to it by the executive team. A formal schedule of matters specifically reserved to it for decision is in 
place, including overall strategy, acquisition and divestment policy, approval of major capital expenditure projects and general and risk 
management policies. 
To enable the Board to discharge its duties all Directors have full access to all relevant information and to the advice and services of the 
Company Secretary. In addition, there is a procedure in place for Directors to take independent professional advice in the furtherance of 
their duties, if necessary at the Company’s expense. 
The Board has established the following committees to which it has delegated specific responsibilities: 
The Nominations Committee 
The Nominations Committee, consisting of the Chairman and two Non-Executive Directors, is responsible for reviewing the size, 
structure and composition of the Board, succession planning and identifying and monitoring candidates for all Board vacancies. 
Appointments to the Board of Directors are made by the Board of Directors. The Non-Executive Directors currently serving on the 
Committee are Lord St John of Bletso, Steven Maine and Steven Scott. 
The Remuneration Committee 
The composition and activities of the Remuneration Committee are described in the Directors’ Remuneration Report on pages 16 to 18. 
The Audit Committee 
The Audit Committee, which comprises the Chairman and two Non-Executive Directors, meets on a six-monthly basis. The Committee 
considers all aspects of the Group’s system of internal control and reviews the interim and annual financial statements before 
submission to the Board for approval. The Committee has unrestricted access to the Group’s auditor and ensures that auditor 
objectivity and independence has not been compromised. It will also recommend the appointment of, and review the fees of the 
external auditor. The Committee does not believe an internal audit function can be justified for the Group at the current time.  
The Non-Executive Directors currently serving on the Committee are Lord St John of Bletso, Steven Scott and Steven Maine. 
Relations with shareholders 
Communications with shareholders are given high priority. The Company encourages the participation of both institutional and private 
investors. There is a regular dialogue with shareholders and potential shareholders including presentations after the Company’s preliminary 
announcement of its year end results. The Board also uses the Annual General Meeting to communicate with investors and maintains an 
up-to-date record of news releases and other information of interest to shareholders on its web site at www.spiritelplc.com. 
Going concern 
The current economic conditions create uncertainty over the level of demand for the Group’s services and the availability of bank finance 
in the foreseeable future. However, a significant proportion of revenue within SpiriTel Business is contracted and/or recurring which gives 
a high degree of visibility and predictability to forecast and future revenues. The Group is currently trading significantly ahead of its results 
for the year to 30 April 2010 due to a combination of full year contribution from acquisitions completed during the year, a further 
acquisition post year end and ongoing organic growth, including the £5m Punch contract that was announced recently.  
The Group currently meets its day-to-day working capital requirements through a bank overdraft facility but usually maintains positive 
cash balances. The overdraft facility was renewed in March 2010 concurrent with a revised and increased senior debt facility The senior 
debt facility was put in place to fund acquisitions, including deferred consideration and earn out payments. There are no matters which 
have been drawn to the Directors’ attention to suggest that the continued provision of these facilities may not be forthcoming on 
acceptable terms. The Group enjoys an excellent relationship with Clydesdale Bank and their support has been central to the recent 
acquisitions. In addition to these bank facilities, the Group is also funded by convertible loan notes, as disclosed in note 20, that are 
repayable in November 2014.   15 SpiriTel plc Annual report and accounts 2010 
 
The Directors have prepared forecasts and projections for the Group, which take account of reasonably possible changes in trading 
performance and show that the Group should be able to operate within the level of its current facilities, and comply with all financial 
covenants.  
On this basis, the Directors have a reasonable expectation that the Group and Company have adequate resources to continue in 
operational existence for the foreseeable future 
Major shareholdings 
At 20 September 2010 the following had shareholdings of 3% or more of the ordinary share capital of the Company: 
Shareholder % of total 
Penta Capital LLP 82.3
Statement of Directors’ responsibilities 
The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and 
regulations. 
Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to 
prepare Group financial statements in accordance with International Financial Reporting Standards as adopted by the European Union 
(IFRS) and financial statements for the parent company in accordance with United Kingdom Generally Accepted Accounting Practice 
(UK GAAP).  
The financial statements are required by law to give a true and fair view of the state of affairs of the Group and Company and of the profit 
or loss of the Group for that period. In preparing these 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 International Financial Reporting Standards as adopted by the European Union have been followed for the 
preparation of the Group financial statements and UK Accounting Standards for the preparation of the parent company financial 
statements, subject to any material departures disclosed and explained in the financial statements;  
• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue  
in business. 
The Directors are responsible for keeping adequate accounting records that disclose with reasonable accuracy at any time the financial 
position of the Group and the Company and enable them to ensure that the financial statements comply with the Companies Act 2006. 
They are also responsible for safeguarding the assets of the Group and hence for taking reasonable steps for the prevention and 
detection of fraud and other irregularities.  
In so far as each of the Directors is aware: 
• there is no relevant audit information of which the Group’s auditor is unaware; and 
• the Directors have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and to 
establish that the auditors are aware of that information. 
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s 
web site. 
Legislation in the United Kingdom governing the preparation and dissemination of the financial statements may differ from legislation in 
other jurisdictions. 
Auditors 
Grant Thornton UK LLP has expressed willingness to continue in office. In accordance with Section 489(4) of the Companies Act 2006 
a resolution to reappoint Grant Thornton UK LLP will be proposed at the Annual General Meeting to be held on 21 October 2010. 
Signed on behalf of the Board 
R W Smith  
Chief Financial Officer 
27 September 2010 
  16 SpiriTel plc Annual report and accounts 2010 
Directors’ Remuneration Report 
 
General information 
The Remuneration Committee is made up solely of Non-Executive Directors. None of them has any personal financial interest in the 
matters to be decided (other than as shareholders or holders of options over ordinary shares), potential conflicts of interest arising from 
cross-directorships nor any day-to-day involvement in running the business. The names of the Directors who have served on the 
Remuneration Committee during the year are as follows: 
Lord St John of Bletso 
S Scott 
S Maine 
The Committee’s role is to review the performance of the Executive Directors and to set the scale and structure of their remuneration, 
paying due regard to the interests of shareholders as a whole and the performance of the Group. Specifically, the Remuneration 
Committee agrees the principal terms of their service contracts, including salaries and other benefits, such as bonuses and share 
options, and other terms and conditions of employment. 
General policy 
The Committee’s executive remuneration policy is designed to attract, retain and motivate individuals to ensure the success of the 
Group relative to other UK businesses of similar size and complexity. External comparisons look at comparable roles in similar 
organisations, in terms of size, market sector, and business complexity. Remuneration packages are designed to reward Directors and 
Executive Group members fairly for their contributions whilst remaining within the range of benefits offered by similar companies in the 
sector. The Remuneration Committee seeks to structure total benefits packages which align the interests of shareholders and senior 
executives. Executive remuneration will continue to be the subject of regular review in accordance with this policy. 
Bonus schemes 
The Group operates discretionary bonus schemes for certain senior managers and other employees. Individual payments made under 
the schemes are partially dependent on the achievement of financial targets and also on the achievement of predetermined individual 
objectives. The Group also tailors bonus arrangements for certain Directors and staff members so as to provide incentivisation for the 
achievement of On Target Earnings commensurate with comparable roles within the industry sector. The Executive Directors and certain 
senior managers also participate in a long-term incentive plan, details of which are given on page 18. 
Policy on service contracts 
The Directors all have service contracts, which require between one and six months’ notice of termination.  
Executive Directors’ service contracts provide for remuneration in the form of salary, bonus and other customary benefits, such as 
permanent health insurance and life assurance as appropriate. The Company also facilitates contributions to personal pension schemes 
for Directors wishing to take part of their benefits in that form. 
Directors’ service contracts 
Details of the Directors’ service contracts are as follows: 
Name Commencement of service Initial period Notice period 
Lord St John of Bletso 28 July 2004 36 months 1 month
A R Mills 20 July 2005 None 6 months
R W Smith 23 May 2007 None 3 months
S Maine 5 April 2006 36 months 1 month
S Scott 28 July 2004 36 months 1 month
  17 SpiriTel plc Annual report and accounts 2010 
 
Directors’ emoluments  
The following table sets out details of the emoluments paid during the year to each Director. The following information forms part of the 
audited financial statements. 
Name Note 
Salary 
and fees 
£000 
Benefits 
in kind 
£000 
Bonus  
£000 
Total 
year ended 
30 April 
2010 
£000 
Total 
year ended 
30 April 
2009 
£000 
Lord St John of Bletso 1 33 – – 33 33
A R Mills  143 1 53 197 169
D Anahory  30 – – 30 119
R W Smith  118 1 43 162 136
S Maine 2 32 – – 32 32
S Scott 3 28 – – 28 28
A J Vose  8–– 8 12
  392 2 96 490 529
Notes: 
1) The fees of Lord St John of Bletso were payable to Newquay Professional Limited. 
2) The fees of S Maine were payable to SM & Partners. 
3)  The fees of S Scott were payable to Penta Capital LLP.  18 SpiriTel plc Annual report and accounts 2010    Directors’ Remuneration Report continued 
 
 
Directors’ share options 
The following table sets out details of options over ordinary shares of the Company which have been granted to each Director: 
 
1 May  
2009 Forfeited Granted 
30 April  
2010 
Exercise 
price in £ Exercise period 
SpiriTel Share Option 
Scheme  
Lord St John of Bletso 40,000 – – 40,000 1.25 May 2009 – May 2018
S Maine 40,000 – – 40,000 1.25 May 2009 – May 2018
As a result of a resolution passed by shareholders at a general meeting held on 30 October 2009, the Company’s ordinary shares were 
consolidated such that existing shareholders received one new ordinary share for each 100 ordinary shares held. The number of options 
under grant and the exercise price per share of options in existence at the date of this change were adjusted to reflect this share 
consolidation. The opening figures for options under grant and the exercise price per share have been restated in the table above to 
reflect this change. 
Long-term incentive plan 
On 12 April 2010, the Company introduced a long-term incentive plan for the Executive Directors and certain senior managers (the 
“Plan”) and cancelled the long-term incentive plan introduced on 22 August 2008. Upon demanding levels of shareholder value being 
realised, the participants in the Plan will be entitled to receive an amount equal to a maximum of 16% of the aggregate of the issued 
equity and convertible equity value. 
Non-Executive Directors 
The remuneration of the Non-Executive Directors is determined by the Executive Directors and the Deputy Chairman within the limits set 
out in the Company’s Articles of Association. 
Lord St John of Bletso  
Chairman of the Remuneration Committee  
27 September 2010 
  19 SpiriTel plc Annual report and accounts 2010 
Independent auditor’s report to the members of SpiriTel plc 
 
We have audited the financial statements of SpiriTel plc for the year ended 30 April 2010 which comprise the consolidated income 
statement, the consolidated statement of changes in shareholder’s equity, the consolidated statement of financial position, the 
consolidated statement of cash flows, the parent company balance sheet and the related notes. The financial reporting framework that 
has been applied in the preparation of the Group financial statements is applicable law and International Financial Reporting Standards 
(IFRSs) as adopted by the European Union. The financial reporting framework that has been applied in the preparation of the parent 
company financial statements is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted 
Accounting Practice). 
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. 
Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to 
them in an 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 
As explained more fully in the Statement of Directors’ Responsibilities set out on page 15, the Directors are responsible for the 
preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit the financial 
statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to 
comply with the Auditing Practices Board’s (APB’s) Ethical Standards for Auditors. 
Scope of the audit of the financial statements 
A description of the scope of an audit of financial statements is provided on the APB's web site at www.frc.org.uk/apb/scope/UKNP. 
Opinion on financial statements 
In our opinion: 
• the financial statements give a true and fair view of the state of the Group's and of the parent company's affairs as at 30 April 2010 
and of the Group's loss for the year then ended;  
• the Group financial statements have been properly prepared in accordance with IFRS as adopted by the European Union; 
• the parent company financial statements have been properly prepared in accordance with United Kingdom Generally Accepted 
Accounting Practice; and 
• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006. 
Opinion on other matter prescribed by the Companies Act 2006 
In our opinion the information given in the Report of the Directors for the financial year for which the financial statements are prepared is 
consistent with the financial statements. 
Matters on which we are required to report by exception 
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our 
opinion: 
• adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received 
from branches not visited by us; or 
• the parent company financial statements are not in agreement with the accounting records and returns; or 
• certain disclosures of Directors’ remuneration specified by law are not made; or 
• we have not received all the information and explanations we require for our audit. 
Kevin Engel  
Senior Statutory Auditor 
for and on behalf of Grant Thornton UK LLP  
Statutory Auditor, Chartered Accountants  
Manchester 
27 September 2010  20 SpiriTel plc Annual report and accounts 2010 
Consolidated income statement 
Year ended 30 April 2010 
 Note 
2010 
£000 
2009
£000 
Continuing operations   
Revenue 3 21,284 19,718
Cost of sales   (12,705) (12,087)
Gross profit   8,579 7,631
Administrative expenses  (9,870) (8,280)
   
Underlying EBITDA  1,600 1,514
Depreciation  (225) (212)
Share-based payments  (204) (204)
Exceptional costs 5 (1,045) (663)
Amortisation of other intangible assets  (1,417) (1,084)
Operating loss 3, 4 (1,291) (649)
   
Operating loss 3, 4 (1,291) (649)
Finance income 7 4 –
Finance costs on bank debt and convertible loan notes  (1,360) (462)
Finance costs under IAS39   (8,768) (597)
Finance costs 8 (10,128) (1,059)
Loss before taxation  (11,415) (1,708)
Tax credit 9 390 774
Loss for the financial year  (11,025) (934)
   
Loss per share in pence   
Basic and diluted 10 (92.1) (16.1)
There are no items to be recognised in a separate consolidated statement of comprehensive income and accordingly no such 
statement has been included. 
The notes on pages 2 to 58 are an integral part of these consolidated financial statements.  
 
4 21 SpiriTel plc Annual report and accounts 2010 
Consolidated statement of changes  
in shareholders’ equity 
 
Share capital
£000 
Share premium
£000 
Reverse 
acquisition 
reserve 
£000 
Other 
reserves 
£000 
Retained 
losses
£000 
Total
£000 
Balance at 1 May 2008 3,162 4,550 (5,763) 565 (9,810) (7,296)
Loss and total recognised loss for the financial year – – – – (934) (934)
Credit for equity-settled share-based payments  – – – 204 – 204
Issue of share capital (net of expenses) 3,114 385 – – – 3,499
Modification and conversion of financial instruments 
– equity component  – – – 1,545 – 1,545
Transfer between reserves – – – (349) 349 –
Balance at 30 April 2009 6,276 4,935 (5,763) 1,965 (10,395) (2,982)
Loss and total recognised loss for the financial year – – – – (11,025) (11,025)
Credit for equity-settled share-based payments  – – – 204 – 204
Issue of share capital (net of expenses) 114 6,692 – – – 6,806
Modification and conversion of financial instruments 
– equity component  – – – 3,768 – 3,768
Transfer between reserves – – – (3,776) 3,776 –
Balance at 30 April 2010 6,390 11,627 (5,763) 2,161 (17,644) (3,229)
The notes on pages 24 to 58 are an integral part of these consolidated financial statements.   22 SpiriTel plc Annual report and accounts 2010 
Consolidated statement of financial position 
As at 30 April 2010 
 Note 
2010 
£000 
2009
£000 
Assets   
Non-current assets   
Goodwill 11 9,953 5,695
Other intangible assets 12 12,347 4,484
Property, plant and equipment  13 787 696
  23,087 10,875
Current assets   
Inventories  16 345 384
Trade and other receivables 17 5,928 2,493
Cash and cash equivalents  18 901 –
  7,174 2,877
Total assets   30,261 13,752
 
Current liabilities   
Trade and other payables 19 (10,340) (4,471)
Borrowings 20 (558) (1,536)
Obligations under finance leases  21 (15) (61)
Current tax payable  (69) (36)
  (10,982) (6,104)
Non-current liabilities   
Trade and other payables  19 (414) (116)
Borrowings  20 (12,198) (9,468)
Derivative financial instruments 20 (6,600) –
Deferred tax liabilities  22 (3,296) (1,046)
  (22,508) (10,630)
Total liabilities   (33,490) (16,734)
Net liabilities  (3,229) (2,982)
 
Equity attributable to equity holders of the parent   
Capital and reserves    
Share capital   6,390 6,276
Share premium  11,627 4,935
Reverse acquisition reserve  (5,763) (5,763)
Other reserves   2,161 1,965
Retained losses  (17,644) (10,395)
Total equity   (3,229) (2,982)
The notes on pages 2 to 58 are an integral part of these consolidated financial statements. 
These financial statements were approved by the Board of Directors on 27 September 2010 and signed on its behalf by: 
A R Mills   R W Smith  
Chief Executive Officer Chief Financial Officer  
Company Number: 5035921 
4  23 SpiriTel plc Annual report and accounts 2010 
Consolidated statement of cash flows 
Year ended 30 April 2010 
 Note 
2010
£000 
2009
£000 
Cash flows from operating activities   
Loss before taxation   (11,415) (1,708)
Adjustments for:   
Net finance costs  10,124 1,059
Depreciation and amortisation  1,642 1,296
Impairment of intangible fixed assets  123 113
Impairment of goodwill  – 199
Decrease/(increase) in inventories  287 (31)
Increase in receivables   (1,176) (146)
Increase/(decrease) in payables   715 (1,168)
Equity-settled share-based payments   204 204
Finance costs paid  (1,296) (230)
Cash used in operating activities  (792) (412)
Income taxes paid  (456) (259)
Net cash used in operating activities  (1,248) (671)
 
Cash flows from investing activities   
Acquisition of subsidiaries net of cash acquired  15 (6,805) (797)
Payment of deferred and contingent consideration  (1,270) (382)
Purchase of property, plant and equipment   (111) (470)
Net cash used in investing activities  (8,186) (1,649)
 
Cash flows from financing activities   
Net (costs)/proceeds from issue of share capital   (45) 333
Proceeds from borrowings (net)  10,973 480
Payment of finance lease liabilities  (66) (78)
Net cash from financing activities  10,862 735
 
Net increase/(decrease) in cash and equivalents  1,428 (1,585)
Cash and cash equivalents at beginning of year   (527) 1,058
Cash and cash equivalents at end of year  18 901 (527)
The notes on pages 24 to 58 are an integral part of these consolidated financial statements. 24 SpiriTel plc Annual report and accounts 2010 
Notes to the consolidated financial statements 
 
 
1. Basis of preparation 
These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS), as adopted by 
the European Union (EU) and interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC). 
These financial statements have been prepared under the historical cost convention, except for the revaluation of certain financial 
instruments. The accounting policies have been applied consistently throughout the Group for the purposes of the preparation of these 
consolidated financial statements. 
Adoption of new accounting standards 
The Group has adopted the following new interpretations, revisions and amendments to IFRS issued by the International Accounting 
Standards Board, which are relevant to and effective for the Group’s financial statements for the annual period beginning 1 May 2009: 
• IFRS 8 Operating Segments; 
• IAS 1 Presentation of Financial Statements (Revised 2007); and 
• Amendments to IFRS 7 Financial Instruments: Disclosures – improving disclosures about financial instruments. 
Significant effects on current, prior or future periods arising from the first time application of these new requirements in respect of 
presentation, recognition and measurement are described below.  
IFRS 8 Operating Segments  
IFRS 8 was issued in November 2006 and is effective for the periods beginning on or after 1 January 2009. This IFRS specifies how an 
entity should report information about its operating segments in its financial statements. Generally, financial information is required to be 
reported on the same basis as is used internally by the chief operating decision maker (‘‘CODM’’) for evaluating operating segment 
performance and deciding how to allocate resources to operating segments. As the changes are presentational only, the adoption has 
had no impact upon the results or net assets of the Group. 
IAS 1 Presentation of Financial Statements (revised 2007) 
The Group has adopted IAS 1 Presentation of Financial Statements (Revised 2007) in its Group Financial Statements. This standard has 
been applied retrospectively. The adoption of the standard does not affect the financial position of the Group but affects the presentation 
of the financial statements. 
IAS 1 (Revised 2007) affects the presentation of owner changes in equity and introduces an option to present a single ‘‘Group 
Statement of comprehensive income’’. The Group has elected to present the ‘‘Group Statement of comprehensive income’’ in two 
statements. The measurement and recognition of the Group’s assets, liabilities, income and expense is unchanged. 
Two comparative periods are presented for the statement of financial position when the Group: 
• Applies an accounting policy retrospectively; or 
• Makes a retrospective restatement of items in its financial statements. 
Although the Group has applied IAS 1 there has been no retrospective restatement of items in its financial statements. Consequently, 
the statement of financial position includes only one comparative period. 
Amendment to IFRS 7 Financial Instruments: Disclosures – Improving disclosures about financial instruments.  
The amendments require additional disclosures for financial instruments that are measured at fair value in the statement of financial 
position. These fair value measurements are categorised into a three-level fair value hierarchy, which reflects the extent to which they are 
based on observable market data. The fair value hierarchy has the following levels: 
• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities; 
• Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) 
or indirectly (i.e. derived from prices); and 
• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs). 
This hierarchy groups financial assets and liabilities into three levels based on the significance of inputs used in measuring the fair value of 
the financial assets and liabilities. The level within which the financial asset or liability is classified is determined based on the lowest level 
of significant input to the fair value measurement. 
A separate quantitative maturity analysis must be presented for derivative financial liabilities that shows the remaining contractual 
maturities, where these are essential for an understanding of the timing of cash flows. The Group has taken advantage of the transitional 
provisions in the amendments and has not provided comparative information in respect of the new requirements. 
  25 SpiriTel plc Annual report and accounts 2010 
 
 
 
1. Basis of preparation continued 
Standards and interpretations not yet applied 
The following new Standards and Interpretations, which are yet to become mandatory, have not been applied in the Group’s 2010 
consolidated financial statements: 
Standard or Interpretation Applicable* 
IFRIC 17 Distribution of non-cash assets to owners 1 July 2009 
IFRIC 18 Transfers of assets from customers 1 July 2009 
IFRIC 19 Extinguishing financial liabilities with equity instruments 1 July 2010 
IAS 24 Related party disclosures (revised 2009) 1 January 2011 
IAS 27 Consolidated and separate financial statements (revised 2008) 1 July 2009 
IAS 39 (amended) Financial Instrument and Measurement – Eligible hedged items 1 July 2009 
IFRS 1 (amended) 
First time adoption of IFRS and IAS 27 Consolidated and separate financial statements  
– cost of investment in a subsidiary, jointly controlled entity or associate 1 January 2009 
IFRS 2 (amended) Group cash-settled share-based payment transactions 1 January 2010 
IFRS 3 Business combinations (revised 2008) 1 July 2009 
IFRS 9 Financial instruments 1 January 2013 
*Applicable to accounting periods beginning on or after the following dates. 
The Directors consider that the adoption of these standards and interpretations in future periods will have no material financial impact 
on the consolidated financial statements other than as follows: 
• IFRS 3 “Business Combinations (revised 2008)”. The revised approach to accounting for business combinations under IFRS 3 will be 
applied to acquisitions occurring in future periods only, and have no impact on prior period acquisitions. 
• IFRC 19 “Extinguishing financial liabilities with equity instruments”. Management is assessing the impact of the change in accounting 
when an equity instrument is issued to a creditor to extinguish an existing financial liability on future and prior periods. 
Going concern 
The current economic conditions create uncertainty over the level of demand for the Group’s services and the availability of bank finance 
in the foreseeable future. However, a significant proportion of revenue within SpiriTel Business is contracted and/or recurring which gives 
a high degree of visibility and predictability to forecast and future revenues. The Group is currently trading significantly ahead of its results 
for the year to 30 April 2010 due to a combination of full year contribution from acquisitions completed during the year, a further 
acquisition post year end and ongoing organic growth, including the £5m Punch contract that was announced recently.  
The Group currently meets its day-to-day working capital requirements through a bank overdraft facility but usually maintains positive 
cash balances. The overdraft facility was renewed in March 2010 concurrent with a revised and increased senior debt facility The senior 
debt facility was put in place to fund acquisitions, including deferred consideration and earn out payments. There are no matters which 
have been drawn to the Directors’ attention to suggest that the continued provision of these facilities may not be forthcoming on 
acceptable terms. The Group enjoys an excellent relationship with Clydesdale Bank and their support has been central to the recent 
acquisitions. In addition to these bank facilities, the Group is also funded by convertible loan notes, as disclosed in note 20, that are 
repayable in November 2014.  
The Directors have prepared forecasts and projections for the Group, which take account of reasonably possible changes in trading 
performance and show that the Group should be able to operate within the level of its current facilities, and comply with all financial 
covenants.  
On this basis, the Directors have a reasonable expectation that the Group and Company have adequate resources to continue in 
operational existence for the foreseeable future. 
General information 
SpiriTel plc is a company incorporated in the UK under the Companies Act 2006. The address and registered office is 18 King William 
Street, London EC4N 7BP. The nature of the Group’s operations and its principal activities are set out in the Directors’ Report.  26 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
2. Accounting policies 
The accounting policies adopted in relation to IFRS are set out below. Other than as described in note 1, there have been no changes 
to these accounting policies during the current financial year.  
Significant accounting judgements and sources of estimation uncertainty 
In applying the Group’s accounting policies, management makes certain judgements and estimates. Estimates focus on areas such as 
the carrying values and estimated lives of non-current assets. 
The accounting policy descriptions include descriptions of areas where judgement is exercised and in consequence might have a 
significant risk of causing material adjustment within the next financial year. In this regard, the key areas are impairment of goodwill, 
revenue recognition, intangible assets, valuation of financial liabilities and share based compensation.  
Impairment of goodwill 
Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to which goodwill 
has been allocated. The “value in use” calculation requires management to estimate the future cash flows expected to arise from the 
cash-generating unit and a suitable discount rate in order to calculate present value (see note 11). 
The carrying value of goodwill at the reporting date was £9,953,000 (2009: £5,695,000). 
Revenue recognition 
In making their judgement, management has considered the detailed criteria for the recognition of revenue from the sale of goods as 
outlined in IAS 18 “Revenue” and, in particular, where the Group has transferred to the customer the significant risks and rewards of 
ownership of the goods and whether the Group has fulfilled its contractual obligations. Management is satisfied that recognition of all 
such revenue in the current year is appropriate. 
Intangible assets 
In establishing the initial values of intangible assets separately identified on acquisition as required by IFRS 3 “Business Combinations” 
management has estimated the future cash flows attributable to assets acquired and their estimated useful economic lives and applied 
a suitable weighted average cost of capital to calculate present values. 
The carrying value of intangible assets at the reporting date was £12,347,000 (2009: £4,484,000). 
Share-based compensation 
The assumptions on the expected life of share options, volatility of share price, risk free yield to maturity and expected dividend yield on 
shares are used in the fair value calculation of the Group’s share options outstanding at the reporting date (see note 27). 
Financial instruments 
The valuation of embedded derivatives contained within the Group’s borrowings is performed using option modelling techniques and 
requires assumptions to be made including expected life of options, volatility of share prices, risk free yield to maturity and expected 
dividend yields on shares. 
The carrying value of embedded derivates at the reporting date was £6,600,000 (2009: £nil). 
Basis of consolidation 
The consolidated financial statements incorporate the financial statements of the Company and all of its subsidiary undertakings, 
together with the Group’s share of the net assets and results of joint ventures. The financial statements of all Group companies are 
adjusted, where necessary, to ensure the use of consistent accounting policies. The results of companies acquired or disposed of are 
included in the Group income statement from or up to the date that control passes respectively.  
Acquisitions are accounted for under the acquisition method. The acquisition of Spiritel Technologies during 2005 has been accounted 
for under the reverse acquisition method, on the basis that the substance of the business combination was that SpiriTel Technologies 
Limited acquired SpiriTel Plc by a reverse acquisition.  
For business combinations completed prior to the date of transition to IFRS (1 May 2006) the Group has elected not to apply IFRS 3 
“Business Combinations” retrospectively.  
Accordingly, the classification of the combination (acquisition, reverse acquisition or merger) remains unchanged from that used 
under UK GAAP. Assets and liabilities are recognised at date of transition if they would be recognised under IFRS, and are measured 
using their UK GAAP carrying amount immediately post-acquisition as deemed cost under IFRS, unless IFRS requires fair value 
measurement. Deferred tax and minority interest are adjusted for the impact of any consequential adjustments after taking advantage 
of the transitional provisions.  
The transitional provisions used for past business combinations apply equally to past acquisitions of interests in associated and 
joint ventures.   27 SpiriTel plc Annual report and accounts 2010 
 
 
 
2. Accounting policies continued 
Revenue  
Revenue is recognised to the extent that it is probable that the economic benefit will flow to the Group and can be reliably measured. 
The following specific recognition criteria must also be met before revenue is recognised:  
Networks 
Revenue from telephony network services is recognised in the month in which the services are provided. Calls made in the year but not 
billed are recognised within receivables as accrued income.  
IP Communications 
IP Communications revenues comprise the sale of goods, including installation, and the provision of maintenance and hosting services. 
Revenue from the sale of goods, including installation, is recognised when the significant risks and benefits of ownership of the product 
have transferred to the buyer, which may be upon shipment or completion of the installation as determined by the contract terms. 
Revenue from maintenance and hosting contracts and other fixed term service agreements is recognised evenly over the period of the 
contract with revenue for the unexpired period of the contract being recognised as deferred income. 
Mobile 
Mobile revenue comprises connection commissions received from mobile network operators and a share of the network operators’ 
ongoing revenue. Connection commissions are recognised when the customer is connected to the mobile network after providing for 
expected future rebates. Ongoing revenue share, based on end user call volumes, is recognised in the period in which it is earned.  
Call termination  
Revenue from call termination, attributable to SpiriTel Technologies, is recognised in the month in which it occurs. Call termination 
services provided in the year but not billed are recognised within receivables as accrued income.  
Operating segments 
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker 
(CODM). The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating 
segments, has been identified as the Group Board that makes strategic decisions. 
Goodwill 
Goodwill representing the excess of the cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired 
is capitalised and reviewed annually for impairment. Goodwill is carried at cost less accumulated impairment losses. Any excess of the 
acquirer’s interest in the net fair value of the acquiree’s identifiable assets and liabilities and contingent liabilities in comparison to cost is 
recognised immediately after acquisition in the income statement. 
Goodwill written off to reserves prior to the date of transition to IFRS remains in reserves. There is no re-instatement of goodwill that was 
amortised prior to transition to IFRS. Goodwill previously written off to reserves is not written back to profit and loss on subsequent 
disposal. 
Property, plant and equipment 
Property, plant and equipment are included at cost, less accumulated depreciation and any provision for impairment. Depreciation is 
provided on these assets on a straight-line basis to write off their historical cost, less estimated residual value, over their estimated useful 
economic lives. Residual values are assessed at least annually. The annual rates generally applicable are as follows: 
Leasehold improvements  – over the period of the lease 
Office and computer equipment – 10% to 33% straight line 
Motor vehicles   – 33% straight line 
Plant and equipment  – 20% to 33% straight line 
Intangible assets  
In accordance with IFRS 3 – “Business Combinations”, an intangible asset acquired in a business combination is deemed to have a cost 
to the Group of its fair value at the date of acquisition. The fair value of the intangible asset reflects the market expectations about the 
probability that the future economic benefits embodied in the asset will flow to the Group. 
Acquisitions during the current and prior financial years have resulted in the following categories of intangible assets being identified: 
Customer relationships 
Marketing assistance 
Customer order backlog 
Trade names  28 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
2. Accounting policies continued 
Amortisation 
The estimated useful lives of intangible assets are as follows:  
Customer relationships – 6 or 10 years 
Third party marketing assistance – 3 years 
Customer order backlog – over the period that the orders will be invoiced 
Trade names – 1 or 2 years 
Impairment testing of goodwill, other intangible assets and property, plant and equipment  
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows 
(cash-generating units). As a result, some assets are tested individually for impairment and some are tested at cash-generating unit level. 
Goodwill is allocated to those cash-generating units that are expected to benefit from synergies of the related business combination and 
represent the lowest level within the Group at which management monitors the related cash flows. 
Goodwill, other individual assets or cash-generating units that include goodwill and other intangible assets with an indefinite useful life are 
tested for impairment at least annually. All other individual assets or cash-generating units are tested for impairment whenever events or 
changes in circumstances indicate that the carrying amount may not be recoverable. 
An impairment loss is recognised for the amount by which the asset’s or cash-generating unit’s carrying amount exceeds its recoverable 
amount. The recoverable amount is the higher of fair value, reflecting market conditions less costs to sell, and value in use based on an 
internal discounted cash flow evaluation. Impairment losses recognised for cash-generating units, to which goodwill has been allocated, 
are credited initially to the carrying amount of goodwill. Any remaining impairment loss is charged pro rata to the other assets in the 
cash-generating unit. With the exception of goodwill, all assets are subsequently reassessed for indications that an impairment loss 
previously recognised may no longer exist. 
Leased assets 
Finance leases and hire purchase agreements 
Where the Group enters into a lease that transfers substantially all the risks and rewards of ownership of an asset to the lessee, the lease 
is treated as a finance lease. The asset is recorded in the statement of financial position as property, plant and equipment at the present 
value of the minimum lease payments and is depreciated over the shorter of the lease term and the asset’s useful economic life. Future 
instalments under such leases, net of finance charges, are included in creditors. Rentals payable are apportioned between the finance 
element, which is charged to the income statement at a constant rate of charge on the balance of capital repayments outstanding, and 
the capital element, which reduces the outstanding obligation. 
Operating lease agreements 
Leases where substantially all of the risks and rewards of ownership are not transferred to the Group are treated as operating leases. 
Rentals under operating leases are charged against profits on a straight-line basis over the period of the lease. 
Inventories 
Inventories are stated at the lower of cost and net realisable value, after provisions are made in respect of obsolete and slow moving 
items. Net realisable value is the estimated selling price less all further costs to complete and all costs to be incurred in marketing, selling 
and distribution. Cost is assigned on a first-in, first-out basis. 
Current tax 
The current tax charge is based on the profit or loss for the year and is measured at the amounts expected to be paid based on the tax 
rates and laws substantively enacted by the reporting date. Current and deferred tax is recognised in the income statement for the 
period except to the extent that it is attributable to a gain or loss that is or has been recognised directly in the statement of other 
comprehensive income.  29 SpiriTel plc Annual report and accounts 2010 
 
 
 
2. Accounting policies continued 
Deferred tax 
Deferred tax is recognised on all temporary differences where the transactions or events that give the Group an obligation to pay more 
tax in the future, or a right to pay less tax in the future, have occurred by the reporting date. 
Deferred tax liabilities are provided in full, with no discounting. Deferred tax assets are recognised to the extent that it is probable that the 
underlying deductible temporary differences will be able to be offset against future taxable income. Deferred tax assets and liabilities are 
calculated at tax rates that are expected to apply to their respective period of realisation, provided that they are enacted or substantively 
enacted by the reporting date. 
Deferred tax is not provided on the initial recognition of goodwill or on the initial recognition of an asset or liability unless the related 
transaction is a business combination or affects tax or accounting profit. Deferred tax on temporary differences associated with shares in 
subsidiaries and joint ventures is not provided if reversal of these temporary differences can be controlled by the Group and it is probable 
that reversal will not occur in the foreseeable future. 
Cash and cash equivalents 
For the purposes of the consolidated statement of cash flows, cash and cash equivalents, comprises cash in hand and deposits 
repayable on demand, less overdrafts payable on demand. 
Foreign currency 
Transactions in foreign currencies are translated at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities 
in foreign currencies are translated at the rate of exchange ruling at the reporting date. Any exchange differences arising on the 
settlement of monetary items or on translating monetary items at rates different from those at which they were initially recorded are 
recognised in the income statement in the period in which they arise. 
Contributions to pension schemes 
The Group contributes to the personal pension schemes of certain Directors and employees. The pension costs are charged against 
operating profit in the relevant accounting period. 
Exceptional items 
Exceptional items are material items which individually, or if a similar type, in aggregate, need to be disclosed by virtue of their size or 
incidence in order to understand the Group’s financial performance. 
Financial instruments 
Financial assets are recognised when the Group becomes a party to the contractual provisions of the instrument. Financial liabilities are 
obligations to pay cash or other financial assets and are recognised when the Group becomes a party to the contractual provisions of 
the instrument. Financial liabilities categorised as at fair value through profit or loss are recorded initially at fair value and all transaction 
costs are recognised immediately in the income statement. All other financial liabilities are recorded initially at fair value, net of direct 
issue costs. 
Financial liabilities categorised as at fair value through profit or loss are re-measured at each reporting date at fair value, with changes 
in fair value being recognised in the income statement. A financial liability is classified as held for trading if it is a derivative that is not 
designated and effective as a hedging instrument. 
All other financial liabilities are recorded at amortised cost using the effective interest method, with interest-related charges recognised 
as an expense in finance cost in the income statement. Finance charges, including premiums payable on settlement or redemption and 
direct issue costs, are charged to the income statement on an accruals basis using the effective interest method and are added to the 
carrying amount of the instrument to the extent that they are not settled in the period in which they arise.  30 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
2. Accounting policies continued 
Classification as equity or financial liability 
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. 
A financial liability exists where there is a contractual obligation to deliver cash or another financial asset to another entity, or to exchange 
financial assets or financial liabilities under potentially unfavourable conditions. In addition, contracts which result in the entity delivering 
a variable number of its own equity instruments are financial liabilities. Shares containing such obligations are classified as financial 
liabilities. 
Finance costs and gains or losses relating to financial liabilities are included in the income statement. The carrying amount of the liability 
is increased by the finance cost and reduced by payments made in respect of that liability. 
Finance costs are calculated so as to produce a constant rate of charge on the outstanding liability. 
An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities. 
Dividends and distributions relating to equity instruments are debited directly to reserves. 
Compound instruments 
Compound instruments comprise both a liability and an equity component. The elements of a compound instrument are classified in 
accordance with their contractual provisions. At the date of issue, the liability component is recorded at fair value, which is estimated 
using the prevailing market interest rate for a similar debt instrument without the equity feature. Thereafter, the liability component is 
accounted for as a financial liability in accordance with the accounting policy set out above. 
The residual is the equity component, which is accounted for as an equity instrument. 
Embedded derivatives 
Derivatives embedded in other financial instruments or other host contracts are treated as separate derivatives when their risks and 
characteristics are not closely related to those of the host contracts and the host contracts are not measured at their fair value with 
changes in fair value recognised in profit or loss. 
Where there have been significant modifications to the terms of existing financial liabilities these are accounted for as an extinguishment 
of the original financial liability and the recognition of a new financial liability. The gain/loss arising on the modification is included in the 
income statement and is calculated as the fair value of the new financial liability compared to the fair value of the original financial liability 
immediately prior to the modification. Where equity instruments have been issued as part of the modification, the issue of the equity is 
accounted for as a transaction with equity holders and no gain/loss is recognised in that respect. 
Equity 
Equity comprises the following: 
• Share capital represents the nominal value of equity shares. 
• Share premium represents the excess over nominal value of the fair value of consideration received for equity shares, net of expenses 
of the share issue. 
• Other reserves represent equity-settled share-based employee remuneration until such share options are exercised and the equity 
component of financial instruments. 
• Reverse acquisition reserve represents the amount recognised in respect of the reverse acquisition accounting treatment of the 
acquisition of SpiriTel plc by SpiriTel Technologies Limited (formerly Expo Communications Limited) in 2005. 
Share-based payments 
Equity-settled share-based payment 
The Group issues equity-settled benefits to certain Directors and employees. All share-based payment arrangements granted after 
7 July 2005 that had not vested prior to 1 May 2006 are recognised in the financial statements. Where employees are rewarded using 
share-based payments, the fair values of employees’ services are determined indirectly by reference to the fair value of the instrument 
granted to the employee. This fair value is appraised at the grant date and excludes the impact of non-market vesting conditions. 
All equity-settled share-based payments are ultimately recognised as an expense in the income statement with a corresponding credit 
to other reserves. 
If vesting periods or other non-market vesting conditions apply, the expense is allocated over the vesting period, based on the best 
available estimate of the number of share options expected to vest. Estimates are revised subsequently if there is any indication that 
the number of share options expected to vest differs from previous estimates. Any cumulative adjustment prior to vesting is recognised 
in the current period. No adjustment is made to any expense recognised in prior periods if share options that have vested are not 
exercised. 
Upon exercise of share options, the proceeds received net of attributed transaction costs are credited to share capital and, where 
appropriate, additional paid in capital.  31 SpiriTel plc Annual report and accounts 2010 
 
 
 
2. Accounting policies continued 
Cash-settled share-based payment 
For cash-settled share-based payments the goods and services received and the liability incurred are measured at the fair value of 
the liability and allocated as an expense over the vesting period. The liability is then re-measured until settlement with changes being 
recognised in the income statement.  
3. Revenue and segmental information  
Operating segments have been determined based on the reports regularly reviewed by the Board of Directors that are used to make 
strategic and operational decisions. The Board is considered to be the CODM. The Board of Directors review the business based on the 
nature of the services provided.  
SpiriTel plc has two operating business units, Business and Technologies. The Business unit is then further analysed by its three service 
streams being IP Communications, Networks and Mobile. There is also a Central division that supplies back office functions and 
executive management to support the Group’s operations. The business units deliver independent products and services although 
SpiriTel Technologies provides support to SpiriTel Business through its network architecture and capabilities. Inter-segment sales are 
charged at arm’s length prices. 
SpiriTel Business 
SpiriTel Business operates three lines of business, namely IP Communications, Network Services and Mobile. The business unit is 
headquartered in Wigan but provides national engineering coverage and customer support on a 24/7 basis. 
SpiriTel IP Communications 
SpiriTel IP Communications provides a range of voice and data services to business customers, including hosted VoIP and WiFi, 
traditional telephony equipment, maintenance and structured cabling. SpiriTel IP Communications acquired Boucon Network Solutions 
Limited on 29 January 2010 (see note 15) and Nessco Limited on 18 March 2010 (see note 15). SpiriTel IP Communications supplies all 
business sizes, including large corporates and has particular expertise in the hospitality sector. The business also holds the highest level 
of Mitel accreditation. 
SpiriTel Networks 
SpiriTel Networks provides fixed line telephony services, including inbound and outbound calls, line rental and broadband to business 
users. SpiriTel Networks acquired Edge Solutions Limited on 2 November 2009 (see note 15) and ADK Communications Limited on 
6 November 2009 (see note 15). 
SpiriTel Mobile 
SpiriTel Mobile is an accredited 02 Partner that provides mobile voice and data, including BlackBerry services to business users. SpiriTel 
Mobile acquired MoboTel Management Limited on 11 February 2010 (see note 15). 
SpiriTel Technologies  
SpiriTel Technologies provides call termination services on a limited number of niche routes to many of the UK’s major carriers. It also 
provides managed services to SpiriTel Business and third parties using its IP infrastructure, including its three network operation centres, 
five points of presence and several Tier 1 voice and data carrier interconnects. 
The Group does not have any major customers which represent more than 10% of the Group’s revenue. The measurement policies 
used for segment reporting reflect those used for the Group’s financial statements. Segment assets comprise all assets allocated to the 
segment excluding costs of investments and intercompany loans.  32 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
3. Revenue and segmental information continued 
Year ended 30 April 2010 
 
SpiriTel 
Mobile 
£000 
SpiriTel
Networks
£000 
SpiriTel
IP Comms
£000 
SpiriTel
Business
£000 
SpiriTel 
Technologies 
£000 
Other/ 
Central costs 
£000 
Total
£000 
Continuing operations     
Revenue 4,897 8,085 4,656 17,638 3,646 – 21,284
Gross profit 2,271 2,674 2,946 7,891 688 – 8,579
    
Underlying EBITDA  879 1,410 773 3,062 58 (1,520) 1,600
Depreciation (23) (27) (143) (193) (24) (8) (225)
Share-based payments – – – – – (204) (204)
Exceptional administrative expenses 
(note 5) (134) (83) (373) (590) – (455) (1,045)
Amortisation of other intangible 
assets (196) (727) (494) (1,417) – – (1,417)
Operating profit/(loss) 526 573 (237) 862 34 (2,187) (1,291)
    
Operating profit/(loss) 526 573 (237) 862 34 (2,187) (1,291)
Net finance costs    (10,124)
Loss before taxation    (11,415)
Tax credit    390
Loss for the financial year    (11,025)
Assets and liabilities    
Total assets 4,232 4,130 5,488 13,850 351 16,060 30,261
Total liabilities (1,602) (2,614) (4,817) (9,033) (2,206) (22,251) (33,490)
Net assets/(liabilities) 2,630 1,516 671 4,817 (1,855) (6,191) (3,229)
Other segmental information    
Property, plant and equipment    
– additions during the year – 34 73 107 1 3 111
– depreciation 23 27 143 193 24 8 225
Other intangible assets    
– acquired on business combinations 1,208 5,981 2,214 9,403 – – 9,403
– impairment (included in exceptional 
   administrative expenses) – 123 – – – – 123
– amortisation  196 727 494 1,417 – – 1,417
Goodwill    
– impairment (included in exceptional
   administrative expenses) – – – – – – –
– acquired on business combinations 642 2,835 1,060 4,537 – – 4,537 33 SpiriTel plc Annual report and accounts 2010 
 
 
 
3. Revenue and segmental information continued 
Year ended 30 April 2009 
 
SpiriTel 
Mobile 
£000 
SpiriTel
Networks
£000 
SpiriTel
IP Comms
£000 
SpiriTel
Business
£000 
SpiriTel 
Technologies 
£000 
Other/
Central costs
£000 
Total
£000 
Continuing operations    
Revenue 3,340 2,5554,420 10,315 9,403 – 19,718
Gross profit 1,539 826 3,083 5,448 2,183 – 7,631
   
Underlying EBITDA  506 363 930 1,799 1,103 (1,388) 1,514
Depreciation (24) (2) (134) (160) (46) (6) (212)
Share-based payments – – – – – (204) (204)
Exceptional administrative expenses 
(note 5) (6) (359) (203) (568) (28) (67) (663)
Amortisation of other intangible 
assets (165) (461)(458)(1,084)– –(1,084)
Operating profit/(loss) 311 (459) 135 (13) 1,029 (1,665) (649)
   
Operating profit/(loss) 311 (459) 135 (13) 1,029 (1,665) (649)
Net finance costs   (1,059)
Loss before taxation   (1,708)
Tax credit   774
Loss for the financial year   (934)
Assets and liabilities   
Total assets 2,363 1,257 2,098 5,718 1,483 6,551 13,752
Total liabilities (1,119) (339) (1,641) (3,099) (2,738) (10.897) (16,734)
Net assets/(liabilities) 1,244 918 457 2,619 (1,255) (4,346) (2,982)
Other segmental information   
Property, plant and equipment   
– additions during the year 4 12 422 438 18 14 470
– depreciation 24 2 134 160 46 6 212
Other intangible assets   
– acquired on business combinations – 1,289 – 1,289 – – 1,289
– impairment (included in exceptional  
   administrative expenses) – 113 – 113 – – 113
– amortisation  165 461 458 1,084 – – 1,084
Goodwill   
– impairment (included in exceptional  
   administrative expenses) – 199 – 199 – – 199
– acquired on business combinations – 506 – 506 – – 506
During the year ended 30 April 2009, the group adopted IFRS 8 “Operating Segments”. As a result, prior period disclosures have been 
amended to conform to the current year presentation.  34 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
3. Revenue and segmental information continued 
All segments, and therefore all assets and capital expenditure, are located in the United Kingdom. Analysis of the Group’s revenue by 
geographical market (by destination) is as follows: 
 
2010 
£000 
2009
£000 
United Kingdom 21,283 19,692
Europe – 21
United States 1 5
 21,284 19,718
4. Operating loss 
Operating loss is stated after charging: 
 
2010 
£000 
 2009
£000 
Charges in respect of equity-settled share-based payments 204 204
Depreciation  
– owned assets 180 154
– assets held under finance leases 45 58
Auditor’s remuneration  
as auditor of the parent company and Group consolidated financial statements 24 42
other services  
– audit of subsidiary company financial statements 65 38
– review of Group’s interim results 4 4
– other services 2 3
Operating lease costs  
– land and buildings  219 171
– other  4 –
Amortisation of other intangible assets 1,417 1,084
Exceptional administrative expenses (note 5)  1,045 663
5. Exceptional administrative expenses 
Exceptional expenses included within administrative expenses are summarised below: 
 Note 
2010 
£000 
 2009
£000 
Reorganisation and restructuring costs 1 790 289
Aborted acquisition costs  132 –
Impairment charges – goodwill (see note 11)  – 199
Impairment charges – other intangible assets (see note 12)  123 113
Bad debts written off  – 62
Total exceptional administrative expenses  1,045 663
Notes: 
1)  Reorganisation and restructuring costs include the costs of integration of the acquired businesses.  35 SpiriTel plc Annual report and accounts 2010 
 
 
 
6. Staff costs 
The average number of employees in the Group during the financial year amounted to:  
 
2010
Number 
 2009
Number 
Administrative and operational staff 124 104
Management 2 3
 126 107
The aggregate staff costs for the year including Directors were as follows:  
 
2010
£000 
2009
£000 
Wages and salaries 4,000 3,433
Social security costs 449 396
Share-based payments 204 204
 4,653 4,033
The total number of employees (including Directors) at 30 April 2010 was 160 (2009: 109). 
Wages and salaries include the following amounts in respect of performance related bonuses, inclusive of national insurance and  
share-based payments charged to the income statement. 
 
2010
£000 
2009
£000 
Performance related bonuses 145 308
Equity-settled share-based payment schemes 204 204
 349 512
Directors’ remuneration 
Remuneration in respect of the Directors was as follows: 
 
2010
£000 
2009
£000 
Emoluments and benefits in kind 490 529
Remuneration in respect of the highest paid Director was £197,000 (2009: £169,000). Further details of Directors’ remuneration are 
given in the Directors’ Remuneration Report on pages 16 to 18. 
7. Finance income  
 
2010
£000 
2009
£000 
Bank interest receivable 4 –
  36 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
8. Finance costs  
 
2010 
£000 
2009
£000 
Interest payable on bank loans and overdrafts 1,051 273
Interest on finance leases 7 8
Unwinding of discount on deferred and contingent consideration 302 181
Loss arising on modification and conversion of convertible preference shares 3,768 1,026
Fair value of embedded derivative on issue of convertible loan notes 7,416 –
Change in fair value of embedded derivative during year (816) (429)
Fair value adjustment on convertible loan notes (1,600) –
 10,128 1,059
9. Taxation  
(a) Tax on loss on ordinary activities  
Tax charged in the income statement: 
 
2010 
£000 
 2009
£000 
Current tax:  
Adjustment in respect of prior years 7 (147)
Total current tax charge/(credit) 7 (147)
Deferred tax:  
Credit for current year (385) (273)
Adjustment in respect of prior years (11) (354)
Total deferred tax credit (397) (627)
Total tax credit in income statement (390) (774)
(b) Reconciliation of the total tax credit  
The tax credit in the income statement for the year is the standard rate of corporation tax in the UK of 28% (2009: 28%). The differences 
are reconciled below:  
 
2010 
£000 
2009
£000 
Loss on ordinary activities before taxation  (11,415) (1,708)
Accounting loss multiplied by UK standard rate of corporation tax of 28% (2009: 28%) (3,196) (478)
Expenses not deductible for tax purposes 2,531 353
Tax losses 279 (148)
Adjustment in respect of prior years  (4) (501)
Total tax credit (390) (774)
  37 SpiriTel plc Annual report and accounts 2010 
 
 
 
10. Loss per share 
The calculation of the basic loss per share is based on the loss attributable to ordinary shareholders divided by the weighted average 
number of shares in issue during the period. Prior year data has been restated to reflect the share consolidation effected during the year, 
as described in note 23. The share options and convertible loan notes are not dilutive and therefore diluted earnings per share has not 
been presented.  
The loss and weighted average number of shares used in the calculation are set out below:  
Continuing and total operations 2010 2009 
Loss after tax attributable to ordinary shareholders (£000) (11,025) (934)
Weighted average number of shares 11,969,762 5,786,618
Loss per share (pence) (92.1) (16.1)
11. Goodwill 
 £000 
Cost  
At 30 April 2008 5,561
Additions 506
Other adjustments  96
At 30 April 2009 6,163
Other adjustments (279)
Additions  4,537
At 30 April 2010 10,421
Accumulated impairment 
At 30 April 2008 269
Impairment charge 199
At 30 April 2009 and 30 April 2010 468
Net book amount 
At 30 April 2010 9,953
At 30 April 2009 5,695
The addition to purchased goodwill in the current financial year is analysed as follows: 
 CGU 
2010
£000 
Edge Solutions Limited (see note 15) Networks  2,450
ADK Communications Limited (see note 15) Networks 347
Boucon Network Solutions Limited (see note 15) IP Communications 337
MoboTel Management Limited (see note 15) Mobile 642
Nessco Limited (see note 15) IP Communications 723
Net Telecom (see note 15) Networks 38
Total purchased goodwill capitalised  4,537
The other adjustment to goodwill relates to adjustments to deferred consideration payable on the acquisition of WN1 Limited 
of £205,000 and ED Communications Limited of £74,000.  38 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
11. Goodwill continued 
Goodwill is reviewed for impairment annually or more frequently if events or changes in circumstances indicate that the carrying value 
may be impaired. Goodwill was allocated for impairment testing purposes to cash generating units (CGUs), based on the following 
acquired businesses: 
• SpiriTel Mobile 
• SpiriTel IP Communications 
• SpiriTel Networks  
These CGUs, and specifically the separable acquisitions inherent in each CGU, represent the lowest level within the Group at which 
goodwill was monitored by management for internal reporting purposes, and the level that represented the smallest identifiable group 
of assets which generated largely independent cash inflows. 
The recoverable amount of all the CGUs was based on a value in use calculation using cash flow projections based on the 2010 
forecast which was approved by the Board and extrapolated for a further 6–15 years by a growth rate applicable to each unit. 
The projections are based on the following revenue growth rates, up to and including year five:  
• SpiriTel Mobile   7% 
• SpiriTel IP Communications  5% 
• SpiriTel Networks   5% 
Cost growth was projected at levels below sales growth as the Directors anticipate that the CGUs will be able to increase revenues 
without corresponding increases in costs. Revenue and cost growth rates have been assumed to be 0% after year five. A discount rate 
of 13.5% was applied to these projections, based on the Directors’ assessment of the weighted average cost of capital for the 
company. 
As disclosed above, the discounted cash flow projections exceed the carrying value of each CGU and therefore there has been no 
impairment of goodwill during the financial year. Sensitivity analysis has indicated that no reasonably foreseeable change in the key 
assumptions used in the impairment calculations would result in any impairment charge being recorded in the consolidated financial 
statements. 
The carrying amount of goodwill is split as follows: 
 
2010 
£000 
2009
£000 
SpiriTel Mobile 1,897 1,461
SpiriTel IP Communications 3,776 2,716
SpiriTel Networks 4,280 1,518
 9,953 5,695
  39 SpiriTel plc Annual report and accounts 2010 
 
 
 
12. Other intangible assets  
 
Customer 
relationships 
£000 
Marketing 
assistance
£000 
Customer  
order backlog 
£000 
Trade names
£000 
Total
£000 
Cost   
At 30 April 2008 5,103 222 57 52 5,434
Additions 1,289–– –1,289
At 30 April 2009 6,392 222 57 52 6,723
Additions (see note 15) 9,403 – – – 9,403
At 30 April 2010 15,795 222 57 52 16,126
Amortisation  
At 30 April 2008 832 108 50 52 1,042
Charge for year 1,012 65 7 – 1,084
Impairment charge 64 49 – – 113
At 30 April 2009 1,908 222 57 52 2,239
Charge for year 1,417 – – – 1,417
Impairment charge 123 – – – 123
At 30 April 2010 3,448 222 57 52 3,779
Net book amount  
At 30 April 2010 12,347 – – – 12,347
At 30 April 2009 4,484 – – – 4,484
As part of the impairment review performed during the year, as disclosed in note 11, the Directors have also made an impairment 
charge of £123,000 (2009: £113,000) against the intangible assets attributed to SpiriTel CallPlan Limited. 
The remaining amortisation period of the Customer relationships as at 30 April 2010 is between two and ten years.   40 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
13. Property, plant and equipment  
 
Leasehold
improvements
£000 
Office and
computer
equipment
£000 
Motor 
vehicles 
£000 
Plant and 
equipment 
£000 
Total
£000 
Cost    
At 30 April 2008 40 2,234 44 – 2,318
Additions 103225– 142 470
At 30 April 2009 143 2,459 44 142 2,788
Acquisitions –4660 99 205
Additions –23– 88 111
At 30 April 2010 143 2,528 104 329 3,104
Depreciation   
At 30 April 2008 30 1,849 1 – 1,880
Charge for the year 17 149 21 25 212
At 30 April 2009 47 1,998 22 25 2,092
Charge for the year 28 156 27 14 225
At 30 April 2010 75 2,154 49 39 2,317
Net book amount   
At 30 April 2010 68 374 55 290 787
At 30 April 2009 96 461 22 117 696
Included within office and computer equipment and motor vehicles are assets held under hire purchase agreements with a net book 
value of £119,000 (2009: £110,000). Depreciation charged on those assets during the year amounted to £45,000 (2009: £58,000). 
14. Investments  
On 12 January 2010, MyPhone (UK) Limited, a joint venture undertaking in which the Group held a 50% interest, issued a striking off 
application, and the Group was deemed to have disposed of its interest in the company. Prior to this date, the Group’s share of the 
losses of the joint venture exceeded its interest in the company, and therefore in accordance with IAS 28, the Group had not recognised 
these losses on the basis that the Group had not incurred obligations on behalf of the joint venture. Therefore, no gain or loss was 
realised on disposal of the company, which was subsequently dissolved on 11 May 2010. On disposal, the Group’s share of the 
accumulated losses of the joint venture undertaking was £47,000 (2009: £47,000). 
  41 SpiriTel plc Annual report and accounts 2010 
 
 
 
15. Business combinations 
(a) Edge Solutions Limited 
On 2 November 2009, SpiriTel plc acquired 100% of the issued share capital of Edge Solutions Limited, a company based in the UK. 
The total cost includes the components stated below. The purchase price was settled in cash.  
 £000 
Purchase price 3,600
Contingent consideration under earn out agreement payable in cash (discounted) 2,145
Deferred consideration payable in cash (discounted) 600
Due diligence fees  45
Other professional fees  205
 6,595
A maximum of £6,200,000 of consideration may become payable under an earn out agreement depending on the level of gross profit 
achieved by the business during August – October 2010. In the opinion of the Directors, the likely amount of contingent consideration 
payable is £2,700,000. 
The assessment of the fair values of the assets and liabilities of Edge Solutions Limited for each class of the acquiree’s assets and 
liabilities recognised at the acquisition date are as follows: 
 
Book value  
£000 
Fair value 
adjustments
£000 
Fair value to the 
Group
£000 
Intangible fixed assets identified – 4,900 4,900
Property, plant and equipment 133 – 133
Trade and other receivables 1,329 – 1,329
Cash and cash equivalents 428 – 428
Total assets 1,890 4,900 6,790
Trade and other payables (960) – (960)
Corporation tax  (294) – (294)
Deferred tax (19) (1,372) (1,391)
Total liabilities (1,273) (1,372) (2,645)
Net assets acquired 617 3,528 4,145
Goodwill arising on the acquisition  2,450
Consideration  6,595
 
Satisfied by:   
Cash  3,850
Deferred and contingent consideration to be settled in cash (discounted)  2,745
  6,595
Goodwill on the acquisition of Edge Solutions Limited is largely attributable to the cross-selling opportunities and economies of scale. 
During the period from the date of acquisition to 30 April 2010, Edge Solutions Limited generated revenue of £3,604,000 and an 
operating profit of £546,000.   42 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
15. Business combinations continued 
(b) ADK Communications Limited 
On 6 November 2009, SpiriTel plc acquired 100% of the issued share capital of ADK Communications Limited, a company based in the 
UK. The total cost includes the components stated below. The purchase price was settled in cash.  
 £000 
Purchase price 940
Deferred consideration payable in cash (discounted) 129
Due diligence fees  20
Other professional fees  33
 1,122
A maximum of £510,000 of consideration may become payable under an earn out agreement depending on the level of gross profit 
achieved by the business during September – October 2010. In the opinion of the Directors, the likely amount of contingent 
consideration payable is £nil. 
The assessment of the fair values of the assets and liabilities of ADK Communications Limited for each class of the acquiree’s assets 
and liabilities recognised at the acquisition date are as follows: 
 
Book value  
£000 
Fair value 
adjustments 
£000 
Fair value to the 
Group
£000 
Intangible fixed assets identified – 957 957
Trade and other receivables 99 – 99
Cash and cash equivalents 275 – 275
Total assets 374 957 1,331
Trade and other payables (143) – (143)
Corporation tax (145) – (145)
Deferred tax – (268) (268)
Total liabilities (288) (268) (556)
Net assets acquired 86 689 775
Goodwill arising on the acquisition   347
Consideration   1,122
 
Satisfied by:    
Cash   993
Deferred and contingent consideration to be settled in cash (discounted)   129
   1,122
Goodwill on the acquisition of ADK Communications Limited is largely attributable to the cross-selling opportunities and economies 
of scale. 
During the period from the date of acquisition to 30 April 2010, ADK Communications Limited generated revenue of £715,000 and an 
operating profit of £260,000.   43 SpiriTel plc Annual report and accounts 2010 
 
 
 
15. Business combinations continued 
(c) Boucon Network Solutions Limited 
On 29 January 2010, SpiriTel IP Communications Limited acquired 100% of the issued share capital of Boucon Network Solutions 
Limited, a company based in the UK. The total cost includes the components stated below. The purchase price was settled in cash.  
 £000 
Purchase price 723
Deferred consideration payable in cash (discounted) 60
Due diligence fees  19
Other professional fees  35
 837
The assessment of the fair values of the assets and liabilities of Boucon Network Solutions Limited for each class of the acquiree’s 
assets and liabilities recognised at the acquisition date are as follows: 
 
Book value  
£000 
Fair value 
adjustments
£000 
Fair value to the 
Group
£000 
Intangible fixed assets identified – 840 840
Property, plant and equipment 60 – 60
Inventories 58 – 58
Trade and other receivables 326 – 326
Corporation tax 10 – 10
Deferred tax 2 – 2
Cash and cash equivalents 111 – 111
Total assets 567 840 1,407
Trade payables (118) – (118)
Other taxes  (99) – (99)
Other payables  (435) – (435)
Deferred tax – (235) (235)
Hire purchase agreements (20) – (20)
Total liabilities (672) (235) (907)
Net assets/(liabilities) acquired (105) 605 500
Goodwill arising on the acquisition  337
Consideration  837
 
Satisfied by:   
Cash  777
Deferred and contingent consideration to be settled in cash (discounted)  60
  837
Goodwill on the acquisition of Boucon Network Solutions Limited is largely attributable to the cross-selling opportunities and economies 
of scale. 
The trade and assets of Boucon Network Solutions Limited were transferred to SpiriTel IP Communications Limited immediately 
following the acquisition and therefore we are unable to report on profits for the period from the date of acquisition to 30 April 2010. 
Revenues for this period were £295,000.  44 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
15. Business combinations continued 
(d) MoboTel Management Limited 
On 11 February 2010, SpiriTel Mobile Limited acquired 100% of the issued share capital of MoboTel Management Limited, a company 
based in the UK. The total cost includes the components stated below. The purchase price was settled in cash.  
 £000 
Purchase price 2,000
Deferred consideration payable in cash (discounted) 100
Due diligence fees  26
Other professional fees  62
 2,188
The assessment of the fair values of the assets and liabilities of MoboTel Management Limited for each class of the acquiree’s assets 
and liabilities recognised at the acquisition date are as follows: 
 
Book value  
£000 
Fair value 
adjustments 
£000 
Fair value to the 
Group
£000 
 identified – 1,208 1,208
Trade and other receivables 12 – 12
Cash and cash equivalents 1,299 – 1,299
Total assets 1,311 1,208 2,519
Trade and other payables (589) – (589)
Corporation tax (46) – (46)
Deferred tax – (338) (338)
Total liabilities (635) (338) (973)
Net assets acquired 676 870 1,546
Goodwill arising on the acquisition   642
Consideration   2,188
 
Satisfied by:    
Cash   2,088
Deferred consideration to be settled in cash (discounted)   100
   2,188
Goodwill on the acquisition of MoboTel Management Limited is largely attributable to the cross-selling opportunities and economies 
of scale. 
The trade and assets of MoboTel Limited, the sole subsidiary of MoboTel Management Limited through which all trade was conducted, 
were transferred to SpiriTel Mobile immediately following the acquisition and therefore we are unable to report on profits for the period 
from the date of acquisition to 30 April 2010. Revenues for this period were £510,000. 
 
Intangible fixed assets 45 SpiriTel plc Annual report and accounts 2010 
 
 
 
15. Business combinations continued 
(e) Nessco Limited 
On 18 March 2010, SpiriTel IP Communications Limited acquired 100% of the issued share capital of Nessco Limited, a company 
based in the UK. The total cost includes the components stated below. The purchase price was settled in cash.  
 £000 
Purchase price 1,100
Deferred consideration payable in cash (discounted) 406
Contingent consideration under earn out agreement payable in cash (discounted) 211
Due diligence fees  31
Other professional fees  65
 1,813
A maximum of £300,000 of consideration may become payable under an earn out agreement depending on the level of revenue 
achieved by the business during the 18 months to August 2011. In the opinion of the Directors, the likely amount of contingent 
consideration payable is £300,000. 
The assessment of the fair values of the assets and liabilities of Nessco Limited for each class of the acquiree’s assets and liabilities 
recognised at the acquisition date are as follows: 
 
Book value  
£000 
Fair value 
adjustments
£000 
Fair value to the 
Group
£000 
Intangible fixed assets identified – 1,374 1,374
Property, plant and equipment 12 – 12
Deferred tax 2 – 2
Inventories 190 – 190
Trade and other receivables 493 – 493
Cash and cash equivalents 113 – 113
Total assets 810 1,374 2,184
Trade and other payables (701) – (701)
Corporation tax  (8) – (8)
Deferred tax – (385) (385)
Total liabilities (709) (385) (1,094)
Net assets acquired 101 989 1,090
Goodwill arising on the acquisition  723
Consideration  1,813
 
Satisfied by:   
Cash  1,196
Deferred and contingent consideration to be settled in cash (discounted)  617
  1,813
Goodwill on the acquisition of Nessco Limited is largely attributable to the cross-selling opportunities and economies of scale. 
The trade and assets of Nessco Limited were transferred to SpiriTel IP Communications Limited immediately following the acquisition 
and therefore we are unable to report on profits for the period from the date of acquisition to 30 April 2010. Revenues for this period 
were £437,000.  46 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
15. Business combinations continued 
(f) Net Telecom 
On 17 December 2009, SpiriTel Networks Limited acquired 100% of the trade and assets of Net Telecom Limited, a company based in 
the UK. The total cost includes the components stated below. The purchase price was settled in cash.  
 £000 
Purchase price 120
Other professional fees  7
 127
Consideration may become payable under an earn out agreement depending on the level of gross profit achieved by the business 
during September – October 2010. In the opinion of the Directors, the likely amount of contingent consideration payable is £nil. 
The assessment of the fair values of the assets and liabilities of Net Telecom for each class of the acquiree’s assets and liabilities 
recognised at the acquisition date are as follows: 
 
Book value  
£000 
Fair value 
adjustments 
£000 
Fair value to the 
Group
£000 
Intangible fixed assets identified – 124 124
Total assets – 124 124
Deferred tax – (35) (35)
Total liabilities – (35) (35)
Net assets acquired – 89 89
Goodwill arising on the acquisition   38
Consideration   127
 
Satisfied by:    
Cash   127
Goodwill on the acquisition of Net Telecom Limited is largely attributable to the cross-selling opportunities and economies of scale. 
During the period from the date of acquisition to 30 April 2010, Net Telecom generated revenue of £102,000 and an operating profit of 
£37,000.  
Due to the lack of IFRS specific data prior to these acquisition, the pro-forma revenue and profit of the Group, had any these acquisition 
taken place on 1 May 2009, have not been disclosed as they cannot be reliably determined. 
Reconciliation to the consolidated statement of cash flows: 
 £000 
Cash consideration 9,031
Cash and cash equivalents acquired (2,226)
Net cash outflow arising on acquisitions 6,805
  47 SpiriTel plc Annual report and accounts 2010 
 
 
 
16. Inventories 
 
2010
£000 
2009
£000 
Finished goods for resale 345 384
During the financial year, the Group’s write-down of inventories amounted to £25,000 (2009: £58,000).  
The value of inventory consumed in cost of sales during the year amounted to £3,149,000 (2009: £2,148,000). 
17. Trade and other receivables  
 
2010
£000 
2009
£000 
Trade receivables 3,039 1,121
Amounts owed by related parties (note 28) – 10
Other receivables 168 242
Prepayments and accrued income 2,721 1,120
 5,928 2,493
All the above fall due within one year. 
All trade and other receivables have been reviewed for indicators of impairment and a provision of £203,000 (2009: £129,000) has been 
recorded accordingly. 
Movements of the Group provision for impairment of receivables are as follows: 
 
2010
£000 
2009
£000 
At 1 May 129 212
Amounts written off (51) (172)
On acquisitions 53 –
Amounts provided during year 72 89
At 30 April 203 129
The age of receivables past due but not impaired is as follows: 
 
2010
£000 
2009
£000 
Up to 30 days overdue 561 131
Over 30 days and up to 60 days overdue 277 50
Over 60 days and up to 90 days overdue 241 15
Over 90 days overdue 78 25
 1,157 221
18. Cash and cash equivalents 
 
2010
£000 
2009
£000 
Cash at bank and in hand 901 –
The total cash and cash equivalents as disclosed in the consolidated statement of cash flows is as follows: 
 
2010
£000 
2009
£000 
Cash at bank and in hand 901 –
Bank overdraft – (527)
 901 (527) 48 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
19. Trade and other payables  
 
2010 
£000 
2009
£000 
Amounts falling due within one year:  
Trade payables  3,763 1,983
Amounts owed to related parties (note 28) 18 14
Other taxes and social security payable 528 467
Accruals and deferred income 2,610 1,086
Other payables  533 140
Deferred and contingent consideration  2,888 781
 10,340 4,471
Amounts falling due after one year:  
Deferred and contingent consideration 414 116
20. Borrowings 
 
2010 
£000 
2009
£000 
Borrowing at amortised cost  
Bank loans 4,649 2,326
Bank overdraft – 527
Convertible loan notes 8,107 –
Loan notes – Other – 300
Loan notes – Penta – 770
Other loans – Penta – 5,122
Redeemable preference shares (note 23)  – 1,959
 12,756 11,004
Total borrowings  
Amounts due for settlement within 12 months 558 1,536
Amounts due for settlement after 12 months 12,198 9,468
Bank loans 
Bank loans comprise a term loan from Clydesdale Bank plc of £4,800,000 (2009: £2,527,500). Deferred arrangement fees of £151,000 
(2009: £201,000) have been netted against the amount disclosed above. 
Under a loan agreement dated 18 March 2010, Clydesdale Bank plc provided a term loan facility of £8,000,000 of which £4,800,000 
had been drawn down at 30 April 2010 with the balance to be drawn to pay amounts due as deferred consideration and earn-out 
on acquisitions. This loan is repayable in eight instalments of £400,000 commencing on 17 March 2011plus a bullet repayment of 
£4,800,000 or, in the event that the entire facility is not drawn down, the amount outstanding being due on 17 March 2013.  
This loan was also used to repayment amounts outstanding under the following previous loan agreements:  
(1) £562,500 being the amount outstanding on a loan agreement dated 27 July 2007 under which Clydesdale Bank plc provided a term 
loan of £750,000. As at 30 April 2009, the amount outstanding was £562,500 comprising 15 quarterly payments of £37,500 with the 
final payment due on 31 December 2012. 
(2) £960,000 being the amount outstanding on a loan agreement dated 2 April 2008 under which Clydesdale Bank plc provided a term 
loan of £1,200,000. As at 30 April 2009, the amount outstanding was £960,000 comprising 16 quarterly payments of £60,000 with 
the final payment due on 31 March 2013. 
(3) £1,005,000 being the amount outstanding on a loan agreement dated 4 August 2008 under which Clydesdale Bank plc provided 
a term loan facility of £1,900,000 of which £1,100,000 has been drawn down at 30 April 2009. As at 30 April 2009 the amount 
outstanding was £1,005,000. This loan was repayable in up to 20 instalments of £95,000 with the final payment date depending on 
the final amount drawn but no later than 30 November 2013.   49 SpiriTel plc Annual report and accounts 2010 
 
 
 
20. Borrowings continued 
Bank loans continued 
The Group also has a £750,000 overdraft facility, repayable on demand. This facility replaces an overdraft facility of £250,000 and 
invoicing discounting facility of £650,000 that were in place at 30 April 2009. The loans and overdraft carry interest charged at 
approximately 3.75% above the Clydesdale Bank base rate. 
All Clydesdale Bank plc facilities are secured by debentures over the assets of the Group. 
Other loans 
On 1 May 2009 an interest free loan note of £300,000 issued to the vendors of WN1 Limited was repaid. 
Penta loans, loan notes and redeemable preference shares (the “Penta facilities”) 
At 1 May 2009, the company had outstanding loans and loan notes in favour of Penta amounting to £5,122,000 and £770,000 
respectively. These loans carried the right of conversion into the company’s ordinary shares.  
In addition, at 1 May 2009 the company had £1,959,000 of outstanding redeemable preference shares, including a redemption 
premium of £1,025,000. These outstanding preference shares, together with the redemption premium, also carried the right of 
conversion into the company’s ordinary shares. 
The loans, loan notes and redeemable preference shares could be converted into ordinary shares at the higher of: (a) 1.5p per ordinary 
share; and (b) the latest subscription price for ordinary shares, subject to a restriction that Penta’s holding of the company’s ordinary 
shares could not exceed 49.99%. Since these terms meet the definition of a financial liability, all the outstanding Penta facilities 
subsequent to modification have been classified as a host debt with an embedded derivative. 
Modification and conversion during the year 
On 30 October 2009 the shareholders of the company, at an Extraordinary General Meeting (“EGM”) approved a modification to the 
terms of the outstanding Penta facilities. The modified terms were that Penta could be converted into ordinary shares at 60p. Following 
approval at the EGM, Penta converted all outstanding preference shares and £4,892,000 of outstanding loans and loan notes into 
11,418,014 ordinary shares at 60p pence per ordinary share. Following the conversion the outstanding loans in favour of Penta 
amounted to £1,000,000. 
Convertible loan notes 
On 2 November 2009 the company issued convertible loan notes of £9,200,000 to Penta (£7,450,000) and Synergy Capital LLP 
(£1,750,000). The loan notes have a 10 per cent yield, payable quarterly, are repayable at the Company's option but no later than 
November 2014 and have a 20 per cent redemption premium. The loan notes, including the redemption premium and accrued yield are 
convertible at the holders’ option at the lower of (a) 40p per ordinary share; and (b) 5% above the share price at which acquisition related 
share issues are made by the company. The notes are secured by a second-ranking debenture over the assets of the Group. Since 
these terms meet the definition of a financial liability, the loan notes have been classified as a host debt with an embedded derivative. 
On 17 December 2009 the company issued convertible loan notes of £800,000 on identical terms to those issued on 2 November 
2009. The total fair value amount due under the convertible loan notes is £8,400,000. Deferred arrangement fees of £293,000 have 
been netted against the amount disclosed above.  
A reconciliation of the movements on the carrying value of the loans and loan notes (together “Penta debt”), convertible loan notes, and 
the preference shares during the year is as follows: 
 
Derivative 
financial 
instruments
£000 
Convertible loan 
notes
£000 
Penta debt 
£000 
Preference 
shares
£000 
Total
£000 
Carrying value at 30 April 2009 – – 5,892 1,959 7,851
Debt issued during the year – 10,000 – – 10,000
Fair value adjustment on convertible loan notes (discounted) – (1,600) – – (1,600)
Deferred arrangement fees on debt issued during the year – (293) – – (293)
Fair value of embedded derivative on issue 7,416 – – – 7,416
Change in fair value of embedded derivative (816) – – – (816)
Debt repaid during the year – – (1,000) – (1,000)
Preference shares and debt converted during the year – – (4,892) (1,959) (6,851)
Carrying value at 30 April 2010 6,600 8,107 – – 14,707 50 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
20. Borrowings continued 
The modification and conversion of the Penta facilities and convertible loan notes has resulted in the following charge/credit to the 
income statement and equity (other reserves). 
 Note 
Income 
statement 
£000 
Other reserve
£000 
Change in fair value of embedded derivative on modification 1 3,768 (3,768)
Transfer between reserves  – 3,768
Total charged to income statement  3,768 –
Notes: 
1) This charge is based on the fair value of the incremental number of shares issued on conversion, compared to the number of shares 
which would have been issued under the previous conversion terms. 
Derivative financial instruments 
Management has applied certain judgements and estimates in arriving at the fair value of the embedded derivative under the terms of 
the convertible loan notes, both at the date of issue and as at 30 April 2010. Taking into account (a) there is no restriction on the loan 
note holders ability to convert the outstanding debt; (b) the current share price of the company; (c) the variable conversion price; and 
(d) an estimated conversion date, management has concluded that the fair value of the embedded derivative was £7,416,000 at the 
date of issues and is £6,600,000, at 30 April 2010.  
21. Obligations under finance leases 
 
2010 
£000 
2009
£000 
Amounts payable under finance leases:  
Within one year 17 72
Less: future finance charges (2) (11)
 15 61
Disclosed as:  
Current liabilities 15 61
The fair value of the Group’s lease obligations approximates to their carrying value. 
The Group’s obligations under finance leases are secured by the lessors’ rights over the leased assets disclosed in note 13. 
22. Deferred taxation 
 
2010 
£000 
2009
£000 
Liability at 1 May 1,046 1,312
Acquisitions 2,647 361
Credit for the year (397) (627)
Liability at 30 April (non-current) 3,296 1,046
The rate at which deferred tax is expected to unwind is 28% (2009: 28%) and this rate has been used to calculate the deferred tax 
assets and liabilities. 
The deferred tax liability comprises the following: 
 
At  
1 May 2009
£000 
Credited 
to income 
£000 
Acquisitions  
(see note 15) 
£000 
At 
30 April 2010
£000 
Intangible assets 1,256 (432) 2,633 3,457
Trade losses (181) 12 – (169)
Capital allowances exceeding depreciation (29) 23 14 8
 1,046 (397) 2,647 3,296 51 SpiriTel plc Annual report and accounts 2010 
 
 
 
22. Deferred taxation continued 
 
As 
1 May 2008
£000 
(Credited)/ 
charged 
to income 
£000 
Acquisitions 
£000 
As 
30 April 2009
£000 
Intangible assets 1,230 (335) 361 1,256
Trade losses 102 (283) – (181)
Capital allowances exceeding depreciation (20) (9) – (29)
 1,312 (627) 361 1,046
Deferred tax assets have been recognised in respect of temporary differences to the extent that it is probable that these assets will 
be recovered. In addition to the above, the Group has a potential deferred tax asset which has not been recognised in the financial 
statements of £2,560,000 (2009: £2,354,000) in respect of tax losses. 
23. Share capital 
The ordinary share capital of the Company consists only of shares of par value of 1p each. All ordinary shares are equally eligible to 
receive dividends and represent one vote at the shareholder meetings of the Company. The Company also has in issue deferred shares 
of par value of 1p each which have no voting rights or rights to receive a dividend. 
The preference share capital of the Company consists only of redeemable preference shares with a par value of £1 each.  
Ordinary shares 
 
Deferred
2010
£000 
Ordinary 
2010 
£000 
Total
2010
£000 
Ordinary
2009
£000 
Authorised:   
6,378,636,705 (2009: 2,000,000,000) Ordinary shares of 1p each – 63,786 63,786 20,000
621,363,295 (2009: Nil) Deferred shares of 1p each 6,214 – 6,214 –
Allotted, called up and fully paid:   
Shares classified as equity   
17,694,410 (2009: 627,639,692) Ordinary shares of 1p each  – 177 177 6,276
621,363,295 (2009: Nil) Deferred shares of 1p each 6,214 – 6,214 –
Total – Ordinary and Deferred shares 6,214 177 6,391 6,276
Issued shares 
 Note 
Deferred  
Number 
Ordinary 
Number 
As at 1 May 2009   6,378,636,705
Consolidated into new ordinary shares 1 – (6,378,636,705)
New shares issued post consolidation 1 621,363,295 6,276,396
Shares issued on conversion of Penta debt 2 – 11,418,014
As at 30 April 2010  621,363,295 17,694,410
1) At a general meeting of shareholders held on 30 October 2009, resolutions were passed having the effect that: 
• The Company’s ordinary shares were consolidated such that existing shareholders received one new ordinary share for each 100 
ordinary shares held, resulting in 6,276,396 new ordinary shares of 1p being issued to existing holders. For each new ordinary share 
issued, 99 deferred shares of 1p each were issued, totalling 621,363,295 deferred shares after allowing for fractional adjustments. 
• The Company’s authorised but unissued shares, totalling 1,372,360,308 shares were consolidated and reclassified into 13,723,603 
ordinary shares of £1 each and then subdivided into 1,372,360,308 new ordinary shares of 1p each. 
• The authorised share capital of the Company was increased by the creation of 2,500,000,000 new ordinary shares of 1p each.  52 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
23. Share capital continued 
2) The Company issued and allotted new ordinary 1p shares during the year as follows: 
• On 30 October 2009, Penta Fund 1 Limited Partnership and Penta Fund 1 SP Limited Partnership converted an aggregate of 
£6,850,809 of outstanding debt, preference shares and associated redemption premiums and interest at a conversion price of £0.60 
per new ordinary share into 11,418,014 new ordinary shares. This followed the approval by the Company’s shareholders at the 
general meeting held on 30 October 2009 of the grant by the Panel on Takeovers and Mergers of a waiver in favour of the Penta 
Funds of any obligation on them to make a general offer to equity shareholders of the Company under Rule 9 of the City Code, which 
would otherwise have arisen as a result of such conversion. 
The authorised share capital of the Company was further increased by the creation of 2,500,000,000 new ordinary shares of 1p each as 
a result of a resolution passed by the shareholders at the Annual General Meeting held on 30 October 2009. 
Preference shares 
All of the outstanding preference shares of the Company were converted to new ordinary shares and cancelled during the year as 
described above. In accordance with IAS32 the preference shares are considered to be a host debt with an embedded derivative. 
The carrying value of the preference shares in the financial statements is analysed below. 
 
2010 
Number 
2009
Number 
Authorised:  
Redeemable preference shares of £1 each – 933,533
Allotted, called up and fully paid:  
Shares classified as financial liabilities  
Redeemable preference shares of £1 each – 933,533
The changes in the number of issued preference shares during the year are as explained under the heading Ordinary shares, above. 
 
2010 
£000 
2009
£000 
Principal – 934
Redemption premium – 1,025
 – 1,959
Presented as:  
Debt – 1,959
24. Financial instruments 
24.1 Capital management policies and procedures 
The Group manages its capital with the objective of ensuring that entities within the Group will be able to continue as going concerns 
while seeking to improve the return to stakeholders through the management of the debt and equity balance. 
In March 2010 the Group secured new and increased facilities with Clydesdale Bank plc. The Directors expect the Group will comply 
with all financial covenants required by these facilities. 
The Directors consider that the borrowings payable under the convertible loan notes do not represent debt for the purposes of 
calculating gearing and so no gearing ratios have been disclosed. 
24.2 Significant accounting policies 
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement, and 
the basis on which income and expenses are recognised, in respect of each class of financial asset, financial liability and equity 
instrument are disclosed in note 2 to the financial statements.  53 SpiriTel plc Annual report and accounts 2010 
 
 
 
24. Financial instruments continued 
24.3 Categories of financial instruments 
The IAS 39 categories of financial asset included in the statement of financial position and the headings in which they are included are as 
follows: 
 
2010
£000 
2009
£000 
Loans and other receivables – cash and cash equivalents 901 –
Loans and other receivables – other 3,207 1,373
 4,108 1,373
The carrying amount reflected above represents the Group’s maximum exposure to credit risk.  
The IAS 39 categories of financial liabilities included in the statement of financial position and the headings in which they are included are 
as follows: 
 
2010
£000 
2009
£000 
Amortised cost 19,011 13,700
Fair value through profit and loss 6,600 –
 25,611 13,700
24.4 Interest rate and liquidity risk management 
The Group is exposed to interest rate risk as it borrows funds at both fixed and variable rates. Details of borrowings are provided in note 
20 to these financial statements. 
The following tables detail the Group’s remaining contractual maturity for its financial liabilities. The tables have been drawn up on the 
undiscounted cash flows of financial liabilities based upon the earliest date on which the Group can be required to pay, which may differ 
from the carrying value of the liabilities at the reporting date. The tables include both interest and principal cash flows. The gross cash 
flows for contingent consideration represent the Directors best estimate of amounts that will be paid. 
At 30 April 2010, the Group’s liabilities have contractual maturities which are summarised below: 
 
Within  
6 months 
£000 
6 to 12 months
£000 
1 to 5 years
£000 
Trade payables 3,763 – –
Amounts owed to related parties 18 – –
Accruals 1,298 100 –
Deferred and contingent consideration 310 2,950 550
Bank loans – 400 4,400
Bank overdraft – – –
Convertible loan notes – – 12,000
Finance leases 15 – –
 5,404 3,450 16,950
  54 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
24. Financial instruments continued 
This compares to the maturity of the Group’s financial liabilities in the previous reporting period as follows: 
 
Within  
6 months 
£000 
6 to 12 months 
£000 
1 to 5 years
£000 
Trade payables 1,983 – –
Amounts owed to related parties 14 – –
Accruals 514 100 –
Deferred and contingent consideration 820 – 150
Bank loans 385 385 1,757
Bank overdraft 527 – –
Loan notes – Penta – – 770
Other loans – Penta – – 5,122
Redeemable preference shares (note 23)  – – 1,959
Loan notes – other 300 – –
Finance leases 36 36 –
 4,579 521 9,758
The Directors do not consider that any of the convertible loan notes will result in any cash outflows except for interest payments, but 
they will be converted into ordinary shares of the Company.  
24.5 Fair value of financial instruments 
The fair value of financial assets and liabilities are determined as follows: 
• the fair value of financial assets and liabilities (excluding derivative instruments) is determined in accordance with generally accepted 
pricing models based on discounted cash flow analysis using prices from observable current market transactions and dealer quotes 
for similar instruments. 
• the fair value of optional derivative instruments is calculated using option pricing models. 
The fair value of the Group’s financial assets and liabilities are not materially different from the amount at which they are recorded in the 
financial statements.  
24.6 Fair value hierarchy 
The Group adopted the amendments to IFRS 7 Improving Disclosures about Financial Instruments effective from 1 January 2009. 
These amendments require the Group to present certain information about financial instruments measured at fair value in the statement 
of financial position. In the first year of application, comparative information need not be presented for the disclosures required by the 
amendment. Accordingly, the disclosure for the fair value hierarchy is only presented for the 30 April 2010 year end. 
The following table presents financial assets and liabilities measured at fair value in the statement of financial position in accordance with 
the fair value hierarchy. This hierarchy groups financial assets and liabilities into three levels based on the significance of inputs used in 
measuring the fair value of the financial assets and liabilities. The fair value hierarchy has the following levels: 
• Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities; 
• Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (ie as  
prices) or indirectly (ie derived from prices); and 
• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs). 
The level within which the financial asset or liability is classified is determined based on the lowest level of significant input to the fair value 
measurement. 
The financial liabilities measured at fair value in the statement of financial position are grouped into the fair value hierarchy as follows: 
 Note 
Level 1
£000 
Level 2 
£000 
Level 3 
£000 
Total
£000 
Designated at fair value through profit and loss 20 – – 6,600 6,600
• There have been no transfers between levels during the period.  55 SpiriTel plc Annual report and accounts 2010 
 
 
 
24. Financial instruments continued 
The Group’s financial liability classified in Level 3 is an embedded derivative entitling the holders of the convertible loan notes, the option 
to convert the debt into shares of the company (see note 20). The fair value of this instrument has been determined using a valuation 
technique with reference to the market share price, the risk free rate on a 30 year UK Government bond, and historic volatility of the 
share price. The change in fair value of the financial instruments is as follows: 
  
Financial 
liabilities at fair 
value through 
profit and loss
£000 
Total
£000 
At 1 May 2009  ––
Fair value on issue of financial instrument  7,416 7,416
Gain recognised in profit and loss for the year and presented in finance costs (see note 8)  (816) (816)
At 30 April 2010  6,600 6,600
Given the above management believe that the fair value presented in these group financial statements is appropriate. 
24.7 Interest rate sensitivity analysis 
The Group’s variable rate borrowings at 30 April 2010 were £4,800,000 (2009: £2,527,500).  
The sensitivity analysis below has been determined based on the exposure to interest rates for both derivative and non-derivative 
instruments at the reporting date. For floating rate liabilities, the analysis is prepared assuming the amount of liability outstanding at the 
reporting date was outstanding for the whole of the year. 
If interest rates had been 50 base points higher/lower and all other variables remained constant, the impact on the Group’s loss for the 
year ended 30 April 2010 would be £24,000 (2009: £13,000). 
24.8 Foreign currency risk management 
The Group does not have any foreign currency denominated trade receivables or payables and is therefore not subject to any significant 
level of foreign exchange rate risk. 
24.9 Credit risk management 
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. 
The principal credit risk arises from the Group’s trade receivables. The trade receivables balance included no (2009: 2) customers who 
represented more than 5% of the total balance. In order to manage credit risk, the Directors set limits for customers based upon a 
combination of payment history, third party credit references and an independent rating agency. The Group’s exposure and the credit 
rating of its counterparties are continuously monitored.  
Ongoing evaluation is performed on the financial condition of the accounts receivable. 
25. Leasing commitments  
At 30 April 2010, the Group had commitments under non-cancellable operating leases as set out below: 
 
2010
£000 
2009
£000 
Land and buildings:  
Within one year 231 205
Between two and five years 316 519
 547 724
Other assets: 
Within one year 35 87
Between two and five years 31 52
 66 139
 613 863
  56 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
26. Capital commitments 
Outstanding capital commitments at 30 April 2010 were £nil (2009: £nil). 
27. Share-based payments 
Equity-settled share-based payments 
The Group’s equity-settled share-based payments comprise the grant of nil-cost options granted under the Group’s Share Option 
Scheme, EMI Share Option Scheme and individual Share Option Agreements. Details of the share options subject to equity-settled 
share-based payments are set out below. In accordance with IFRS 2, the Group has recognised an expense to the income statement 
for the year ended 30 April 2008 representing the fair value of outstanding equity-settled share-based payment awards to employees 
which have not vested as at 1 May 2006. 
Those fair values will be charged to the income statement over the relevant vesting period adjusted to reflect actual and expected 
vesting levels. The Group has calculated the fair market value of the nil-cost options as being based on the market value of a Company 
share at the date of grant adjusted to reflect the fact that an employee is not entitled to receive dividends over the relevant holding 
period. 
The estimated fair values of options which fall under the IFRS 2 accounting charge and inputs used in the Black-Scholes model to 
calculate those fair values are as follows: 
Date of grant 
Number  
granted 
Share price on 
grant date  
£ 
Exercise
price
£ 
Fair value
on grant date
£ 
Vesting
period
Years 
Expected life
Years 
Lapse rate 
% 
Risk free rate
% Volatility 
30 Aug 05 11,905 6.88 7.00 4.740 1 4.667 22 4.50 87.66
30 Aug 05 11,905 6.88 7.00 4.740 2 4.667 45 4.50 87.66
30 Aug 05 11,905 6.88 7.00 4.740 3 4.667 70 4.50 87.66
28 Nov 05 1,000 6.88 7.25 4.284 0 4.417 0 4.50 78.90
21 Jul 06 49,000 3.20 5.00 1.450 1 3.750 20 4.50 74.49
21 Jul 06 49,000 3.20 5.00 1.450 2 3.750 40 4.50 74.49
31 Jan 07 59,267 2.38 3.00 1.130 1 3.250 18 5.25 73.64
31 Jan 07 59,267 2.38 3.00 1.130 2 3.250 18 5.25 73.64
9 May 07 94,118 2.13 2.13 1.060 1 2.975 0 5.25 70.36
9 May 07 235,294 2.13 2.13 1.060 2 2.975 0 5.25 70.36
3 Apr 08 140,000 0.70 1.25 0.380 1 3.000 20 5.25105.20
3 Apr 08 140,000 0.70 1.25 0.380 2 3.000 40 5.25105.20
7 May 08 40,000 1.19 1.25 0.798 1 3.000 20 5.00108.73
7 May 08 40,000 1.19 1.25 0.798 2 3.000 40 5.00108.73
1 Jun 08 6,000 1.20 1.25 0.805 1 3.000 20 5.00108.46
1 Jun 08 6,000 1.20 1.25 0.805 2 3.000 40 5.00108.46
23 Sep 08 6,000 1.25 1.25 0.854 1 3.000 20 5.00109.70
23 Sep 08 6,000 1.25 1.25 0.854 2 3.000 40 5.00109.70
1 Nov 08 4,000 0.95 1.25 0.541 1 3.000 20 4.50 97.19
1 Nov 08 4,000 0.95 1.25 0.541 2 3.000 40 4.50 97.19
1 Dec 08 20,000 0.90 1.25 0.483 1 3.000 20 4.50 93.28
1 Dec 08 20,000 0.90 1.25 0.483 2 3.000 40 4.50 93.28
The number of share options in issue has been restated to reflect the share capital restructure referred to in note 23.  57 SpiriTel plc Annual report and accounts 2010 
 
 
 
27. Share-based payments continued 
Expected dividend yield 
The expected dividend yield used in the model is nil. 
Expected volatility 
The volatility of the Company’s share price on each grant was calculated as the average of annualised standard deviation of daily 
continuously compounded returns on the Company’s stock, calculated one year back from the date of the grant, where applicable. 
Risk free rate 
The risk free rate is the Bank of England base lending rate on the date of grant. 
Expected life 
The expected life used in the model is the average expected period to exercise and has been adjusted, based on management’s best 
estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations. 
The following is a summary of the Company’s share options in issue during the financial year: 
 2010 2010 2009 2009 
 
Number 
of shares 
under option 
Weighted 
average  
exercise price  
£ 
Number 
of shares 
under option 
Weighted 
average
exercise price 
£ 
Outstanding at 30 April 2009 444,044 1.42 823,170 2.37
Granted during the year –– 152,000 1.25
Forfeited during the year (1,000) 7.25 (519,126) 2.89
Lapsed during the year (77,000) 2.08 (12,000) 1.25
Outstanding at 30 April 2010 366,044 1.26 444,044 1.42
Exercisable at 30 April 2010 310,044 1.27 158,044 1.72
Cash settled share-based payments 
There has been no charge to the income statement during the year in respect of the Long Term Incentive Plan as the fair value of the 
liability at 30 April 2010 is considered to be £nil (2009: £nil). 
28. Related party transactions 
Other related party transactions 
Transactions between Group companies have not been disclosed as these have all been eliminated in the preparation of the 
consolidated financial information. 
The Group’s related parties include its Directors and companies controlled by or associated with its Directors, as disclosed below. 
Transactions with Directors and related parties in respect of their services as Directors are disclosed in the Directors’ Remuneration 
Report on pages 16 to 18. 
Other related party transactions during the year were as follows: 
• Penta Capital LLP, through its managed funds Penta Fund 1 Limited Partnership and Penta Fund 1 SP Limited Partnership (the “Penta 
Funds”) is the holder of 82.3% of the Company’s issued ordinary 1p shares. Steven Scott, a Director of the Company is also a Director 
of Penta Capital LLP. During the year, the Penta Funds converted £6,850,809 of outstanding debt and preference shares into ordinary 
shares in the Company as detailed in note 23. A further £1,000,000 of Penta debt was repaid by the Group in cash. Penta Capital LLP 
also manages various funds which, together with Steven Scott, hold convertible loan notes issued by the Company with an aggregate 
principal amount of £7,565,000. Penta Fund 1 Limited Partnership held options over 100,000 ordinary shares of the Company which 
were terminated during the year. Fees paid to Penta Capital LLP in respect of Steven Scott’s services as a Director of the Company are 
detailed in the Directors’ Remuneration Report on pages 16 to 18. At 30 April 2010, the outstanding balance within creditors in respect 
of these fees was £18,000 (2009: £14,000). 
• Alastair Mills, a Director of the Company, holds convertible loan notes with a principal value of £15,000 through his spouse. 
• Ronald Smith, a Director of the Company, holds convertible loan notes with a principal value of £25,000 through his spouse. 
• Lord St John of Bletso, a Director of the Company, holds convertible loan notes with a principal value of £20,000 through a family trust.  58 SpiriTel plc Annual report and accounts 2010    Notes to the consolidated financial statements continued 
 
 
 
28. Related party transactions continued 
Transactions with key management personnel 
Key management personnel remuneration includes the following expenses: 
 
2010 
£000 
2009
£000 
Short-term employee benefits  
Salaries, bonuses and commissions 151 107
Social security costs 18 12
 169 119
29. Post balance sheet events 
On 27 May 2010, the Company acquired 100% of the issued share capital of Housing Communications Limited (“HCL”), a UK based 
mobile reseller, for an initial consideration of £1.6m, settled in cash. Under the terms of the acquisition, performance related earn-out 
payments of up to £0.4 million may also be payable in cash by August 2011. In the financial year ending 30 September 2009, HCL 
reported revenues of £2.9 million, EBITDA of £461,000 and profit before tax of £490,000. Due to ongoing finalisation of the completion 
balance sheet, it is not possible to estimate reliably the classes of assets and liabilities acquired at this time.  59 SpiriTel plc Annual report and accounts 2010 
Company balance sheet 
 
 Note 
2010
£000 
2009
£000 
Fixed assets   
Tangible assets 5 17 21
Investments  6 19,977 12,662
  19,994 12,683
Current assets  
Debtors  7 3,539 2,174
Cash at bank and in hand  533 –
  4,072 2,174
Creditors: amounts falling due within one year 8 (6,340) (5,880)
Net current liabilities  (2,268) (3,706)
Total assets less current liabilities  17,726 8,977
Creditors: amounts falling due after more than one year 9 (12,198) (9,585)
Net assets/(liabilities)  5,528 (608)
   
Capital and reserves   
Called up share capital 10 6,391 6,276
Share premium 11 11,627 4,935
Other reserves 11 5,929 1,965
Profit and loss account  11 (18,419) (13,784)
Shareholders’ funds/(deficit) 13 5,528 (608)
The notes on pages 60 to 68 are an integral part of these financial statements. 
These financial statements were approved by the Board of Directors on 27 September 2010 and signed on its behalf by: 
A R Mills   R W Smith  
Chief Executive Officer Chief Financial Officer 
 
 
 
 
SpiriTel plc 
Registered number: 5035921 60 SpiriTel plc Annual report and accounts 2010 
Notes to the Company financial statements 
 
1. Accounting policies 
Basis of preparation 
The financial statements have been prepared under the historical cost convention and in accordance with applicable United Kingdom 
accounting standards. 
Share-based payments 
Equity-settled share-based payment  
The Company issues equity-settled benefits to certain Directors and employees. All share-based payment arrangements granted after 
7 July 2005 that had not vested prior to 1 May 2006 are recognised in the financial statements. Where employees are rewarded using 
share-based payments, the fair values of employees’ services are determined indirectly by reference to the fair value of the instrument 
granted to the employee. This fair value is appraised at the grant date and excludes the impact of non-market vesting conditions. 
All equity-settled share-based payments are ultimately recognised as an expense in the profit and loss account with a corresponding 
credit to other reserves. 
If vesting periods or other non-market vesting conditions apply, the expense is allocated over the vesting period, based on the best 
available estimate of the number of share options expected to vest. Estimates are revised subsequently if there is any indication that the 
number of share-options expected to vest differs from previous estimates. Any cumulative adjustment prior to vesting is recognised in 
the current period.  
No adjustment is made to any expense recognised in prior periods if share options that have vested are not exercised. 
Upon exercise of share options, the proceeds received net of attributable transaction costs are credited to share capital, and where 
appropriate additional paid in capital. 
Tangible fixed assets and depreciation 
Tangible fixed assets are included at cost, less accumulated depreciation and any provision for impairment. Depreciation is provided on 
tangible fixed assets, excluding land, on a straight line basis to write off their historical cost, less estimated residual value, over their 
estimated useful economic lives as follows: 
Leasehold improvements  – over the period of the lease 
Office and computer equipment – 10% or 33% straight line 
Investments 
Investments are included at cost less provisions for impairment. 
Leased assets 
Finance leases and hire purchase agreements 
Where the Company enters into a lease that transfers substantially all the risks and rewards of ownership of an asset to the lessee, the 
lease is treated as a finance lease. The asset is recorded in the balance sheet as a tangible fixed asset at the present value of the 
minimum lease payments and is depreciated over the shorter of the lease term and the asset’s useful economic life. Future instalments 
under such leases, net of finance charges, are included in creditors. Rentals payable are apportioned between the finance element, 
which is charged to the profit and loss account at a constant rate of charge on the balance of capital repayments outstanding, and the 
capital element, which reduces the outstanding obligation. 
Operating lease agreements 
Leases where substantially all of the risks and rewards of ownership are not transferred to the Company are treated as operating leases. 
Rentals under operating leases are charged against profits on a straight-line basis over the period of the lease.  61 SpiriTel plc Annual report and accounts 2010 
 
 
 
1. Accounting policies continued 
Current tax 
The current tax charge is based on the profit or loss for the year and is measured at the amounts expected to be paid based on the tax 
rates and laws substantively enacted by the balance sheet date. Current and deferred tax is recognised in the profit and loss account for 
the period except to the extent that it is attributable to a gain or loss that is or has been recognised directly in the statement of total 
recognised gains and losses. 
Deferred tax 
Deferred tax is recognised on all timing differences where the transactions or events that give the Company an obligation to pay more 
tax in the future, or a right to pay less tax in the future, have occurred by the balance sheet date. Deferred tax assets are recognised 
when it is more likely than not that they will be recovered. Deferred tax is measured on an undiscounted basis using rates of tax that 
have been enacted or substantially enacted by the balance sheet date. 
Foreign currency 
Transactions in foreign currencies are translated at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities 
in foreign currencies are translated at the rate of exchange ruling at the balance sheet date. All exchange differences are dealt with 
through the profit and loss account. 
Contributions to pension schemes 
The Company contributes to the personal pension schemes of certain Directors and employees. The pension costs are charged against 
operating profit in the relevant accounting period.  
Financial instruments 
Financial assets are recognised when the Company becomes a party to the contractual provisions of the instrument. Financial liabilities 
are obligations to pay cash or other financial assets and are recognised when the Company becomes a party to the contractual 
provisions of the instrument. Financial liabilities categorised as at fair value through profit or loss are recorded initially at fair value and all 
transaction costs are recognised immediately in the profit and loss account. All other financial liabilities are recorded initially at fair value, 
net of direct issue costs. 
Financial liabilities are recorded at amortised cost using the effective interest method, with interest-related charges recognised as an 
expense in finance cost in the profit and loss account. Finance charges, including premiums payable on settlement or redemption and 
direct issue costs, are charged to the profit and loss account on an accruals basis using the effective interest method and are added to 
the carrying amount of the instrument to the extent that they are not settled in the period in which they arise. 
Classification as equity or financial liability 
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. 
A financial liability exists where there is a contractual obligation to deliver cash or another financial asset to another entity, or to exchange 
financial assets or financial liabilities under potentially unfavourable conditions. In addition, contracts which result in the entity delivering 
a variable number of its own equity instruments are financial liabilities. Shares containing such obligations are classified as financial 
liabilities. 
Finance costs and gains or losses relating to financial liabilities are included in the profit and loss account. The carrying amount of the 
liability is increased by the finance cost and reduced by payments made in respect of that liability.  
Finance costs are calculated so as to produce a constant rate of charge on the outstanding liability.  
An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its liabilities. 
Dividends and distributions relating to equity instruments are debited directly to reserves. 
Compound instruments 
Compound instruments comprise both a liability and an equity component. The elements of a compound instrument are classified in 
accordance with their contractual provisions. At the date of issue, the liability component is recorded at fair value, which is estimated 
using the prevailing market interest rate for a similar debt instrument without the equity feature. Thereafter, the liability component is 
accounted for as a financial liability in accordance with the accounting policy set out above. 
The residual is the equity component, which is accounted for as an equity instrument.  62 SpiriTel plc Annual report and accounts 2010 Notes to the Company financial statements continued 
 
 
2. Employees 
The average number of employees of the Company (including Directors) was made up as follows: 
 
2010 
Number 
 2009
Number 
Administration 9 7
Management 2 3
 11 10
 
 
2010 
£000 
2009
£000 
Staff costs (including Directors) amounted to:  
Wages and salaries 647 629
Social security costs 74 78
Share-based payments 204 204
 925 911
The total number of employees (including Directors) at 30 April 2010 was 13 (2009: 10). 
3. Directors’ remuneration 
Remuneration in respect of the Directors was as follows: 
 
2010 
£000 
 2009
£000 
Emoluments and benefits in kind 490 529
 490 529
Remuneration in respect of the highest paid Director was £197,000 (2009: £169,000). Further details of Directors’ remuneration are 
given in the Directors’ Remuneration Report on pages 16 to 18. 
4. Loss attributable to the Company 
The loss for the financial year of the Company was £4,643,000 (2009: £9,247,000). 
In accordance with Section 408 of the Companies Act 2006, the Company is exempt from the requirements to present its own profit 
and loss account.  63 SpiriTel plc Annual report and accounts 2010 
 
 
 
5. Tangible fixed assets 
 
Leasehold 
Improvements 
£000 
Office and
computer
equipment
£000 
Total 
£000 
Cost  
At 1 May 2009 19 14 33
Additions – 3 3
At 30 April 2010 19 17 36
Depreciation  
At 1 May 2009 4 8 12
Charge for the year 4 3 7
At 30 April 2010 8 11 19
Net book amount at 30 April 2010 11 6 17
Net book amount at 30 April 2009 15 6 21
6. Fixed asset investments 
 
Subsidiary
undertakings
£000 
Cost  
At 1 May 2009 21,157
Additions 7,717
Other adjustments (279)
At 30 April 2010 28,595
Amounts written off 
At 1 May 2009 8,495
Amounts written off during the year 123
At 30 April 2010 8,618
Net book amount at 30 April 2010 19,977
Net book amount at 30 April 2009 12,662
The additions in the year relate principally to the purchase of the whole of the issued share capital of Edge Solutions Limited 
(£6,595,000) and ADK Communications Limited (£1,122,000). Immediately following its acquisition, the name of Edge Solutions Limited 
was changed to SpiriTel Network Services Limited. Further details concerning these acquisitions are given in note 15 to the consolidated 
financial statements. 
Amounts written off during the year comprises £123,000 in respect of SpiriTel CallPlan Limited as a result of an impairment review by 
management of the carrying value of the investments in the Company’s subsidiaries.  64 SpiriTel plc Annual report and accounts 2010 Notes to the Company financial statements continued 
 
 
6. Fixed asset investments continued 
At 30 April 2010, the Company had interests in the following subsidiary companies, all of which are registered in England and Wales. 
To avoid a disclosure of excessive length, dormant subsidiaries have been excluded: 
Name of subsidiary Trading activity 
Class of share 
capital held 
Holding
% 
SpiriTel Technologies Limited Provision of telecommunication services Ordinary 100
SpiriTel Managed Services Limited Provision of telecommunication services Ordinary 100
Expo Communications Limited Intermediate holding company Ordinary 100
SpiriTel IP Communications Limited*  Provision of telecommunication services Ordinary 100
SpiriTel IP Communications (London) Limited Provision of telecommunication services Ordinary 100
SpiriTel IP Communications Scotland Limited** Provision of telecommunication services Ordinary 100
Boucon Network Solutions Limited** Provision of telecommunication services Ordinary 100
Mobotel Management Limited*** Intermediate holding company Ordinary 100
Mobotel Limited**** Provision of telecommunication services Ordinary 100
ADK Communications Limited Provision of telecommunication services Ordinary 100
SpiriTel Network Services Limited Provision of telecommunication services Ordinary 100
SpiriTel Networks Limited Provision of telecommunication services Ordinary 100
SpiriTel Networks (London) Limited Provision of telecommunication services Ordinary 100
SpiriTel CallPlan Limited Provision of telecommunication services Ordinary 100
SpiriTel Mobile Limited Provision of telecommunication services Ordinary 100
*The holding in SpiriTel IP Communications Limited is indirect, through Expo Communications Limited, an intermediate holding company. 
**The holdings in SpiriTel IP Communications Scotland Limited and Boucon Network Solutions Limited are indirect, through SpiriTel IP Communications Limited. 
***The holding in Mobotel Management Limited is indirect, through SpiriTel Mobile Limited. 
****The holding in Mobotel Limited is indirect, through Mobotel Management Limited. 
7. Debtors 
 
2010 
£000 
2009
£000 
Amounts owed by subsidiary undertakings 3,367 2,071
Other debtors 3 –
Prepayments and accrued income 169 103
 3,539 2,174
All the above fall due within one year. 
8. Creditors: amounts falling due within one year 
 
2010 
£000 
2009
£000 
Bank loans (see note 9) 558 708
Overdrafts (see note 9) – 34
Other loans  – 300
Trade creditors 236 56
Amounts owed to subsidiary undertakings 2,835 3,888
Accruals and deferred income 56 103
Deferred and contingent consideration  2,502 781
Other creditors 153 10
 6,340 5,880 65 SpiriTel plc Annual report and accounts 2010 
 
 
 
9. Creditors: amounts falling due after more than one year 
 
2010
£000 
2009
£000 
Convertible loan notes – Penta 6,132 770
Convertible loan notes – other 1,975 –
Other loans – Penta – 5,122
Redeemable preference shares – 1,959
Bank loans 4,091 1,618
Deferred and contingent consideration – 116
 12,198 9,585
The terms of all the borrowings noted above are detailed in note 20 to the consolidated financial statements. 
The bank loans bear interest at 2.75% above the Clydesdale Bank base rate. 
The bank loans and overdrafts are secured by debentures over all of the assets and undertakings of the Company and its subsidiaries, 
supported by cross guarantees between the ailable to the Group and undrawn at 30 April 2010 (2009: £nil). The Company has a term 
loan facility of £8,000,000 with Clydesdale BaCompany and those subsidiaries. The Company participates with its subsidiaries in a 
Group overdraft facility of up to £750,000, of which £742,000 was avnk plc of which £4,800,000 had been drawn down at 30 April 
2010 with the balance to be drawn to pay amounts due as deferred consideration and earn-out on acquisitions. The Company had no 
other undrawn, committed borrowing facilities available to it at 30 April 2010 (2009: £nil).  
The convertible loan notes bear interest at 10% per annum and are redeemable, together with a redemption premium of 20% of the 
principal amount on 2 November 2014. The notes are convertible at the holders option into ordinary shares at a price which is the lower 
of 40 pence per share or 5% above the price at which the Company first issues shares after 2 November 2009. The notes are secured 
by a second-ranking debenture over the assets of the Group.  
The Penta loans and loan notes, which were converted to ordinary shares as described in Note 10 or repaid in cash during the year 
carried the right of conversion into the Company’s ordinary shares and were classified as a host debt with an embedded derivative in 
accordance with FRS 25. The carrying value of the host debt at 30 April 2009 was £5,892,000 and the value of the embedded 
derivative was £nil. 
The treatment of the redeemable preference shares is detailed in note 10 to the Company financial statements. The creditors falling due 
after more than one year are repayable as follows: 
 
2010
£000 
2009
£000 
Between one and two years: 
– debt component of redeemable preference shares – 1,959
– other loans (Penta) – 5,122
– loan notes – 770
– bank loans 1,546 709
– deferred and contingent consideration – 116
 1,546 8,676
Between two and five years: 
– convertible loan notes (Penta) 6,132 –
– convertible loan notes (other) 1,975 –
– bank loans 2,545 909
 12,198 9,585
  66 SpiriTel plc Annual report and accounts 2010 Notes to the Company financial statements continued 
 
 
10. Share capital 
The ordinary share capital of the Company consists only of shares of par value of 1p each. All ordinary shares are equally eligible to 
receive dividends and represent one vote at the shareholder meetings of the Company. The Company also has in issue deferred shares 
of par value of 1p each which have no voting rights or rights to receive a dividend. 
The preference share capital of the Company consists only of redeemable preference shares with a par value of £1 each.  
Ordinary shares 
 
Deferred
2010
£000 
Ordinary 
2010 
£000 
Total 
2010 
£000 
Ordinary
2009
£000 
Authorised:   
6,378,636,705 (2009: 2,000,000,000) Ordinary shares of 1p each – 63,786 63,786 20,000
621,363,295 (2009: Nil) Deferred shares of 1p each 6,214 – 6,214 –
Allotted, called up and fully paid:   
Shares classified as equity   
17,694,410 (2009: 627,639,692) Ordinary shares of 1p each  – 177 177 6,276
621,363,295 (2009: Nil) Deferred shares of 1p each 6,214 – 6,214 –
Total – Ordinary and Deferred shares 6,214 177 6,391 6,276
Issued shares 
Note 
Deferred  
Number 
Ordinary 
Number 
As at 1 May 2009  6,378,636,705
Consolidated into new ordinary shares 1 – (6,378,636,705)
New shares issued post consolidation 1 621,363,295 6,276,396
Shares issued on conversion of Penta debt 2 – 11,418,014
As at 30 April 2010 621,363,295 17,694,410
1) At a general meeting of shareholders held on 30 October 2009, resolutions were passed having the effect that: 
• The Company’s ordinary shares were consolidated such that existing shareholders received one new ordinary share for each 100 
ordinary shares held, resulting in 6,276,396 new ordinary shares of 1p being issued to existing holders. For each new ordinary share 
issued, 99 deferred shares of 1p each were issued, totalling 621,363,295 deferred shares after allowing for fractional adjustments. 
• The Company’s authorised but unissued shares, totalling 1,372,360,308 shares were consolidated and reclassified into 13,723,603 
ordinary shares of £1 each and then subdivided into 1,372,360,308 new ordinary shares of 1p each. 
• The authorised share capital of the Company was increased by the creation of 2,500,000,000 new ordinary shares of 1p each. 
2) The Company issued and allotted new ordinary 1p shares during the year as follows: 
• On 30 October 2009, Penta Fund 1 Limited Partnership and Penta Fund 1 SP Limited Partnership converted an aggregate of 
£6,850,809 of outstanding debt, preference shares and associated redemption premiums and interest at a conversion price of £0.60 
per new ordinary share into 11,418,014 new ordinary shares. This conversion followed immediately after the approval by the 
Company’s shareholders at the general meeting held on 30 October 2009 of the grant by the Panel on Takeovers and Mergers of a 
waiver in favour of the Penta Funds of any obligation on them to make a general offer to equity shareholders of the Company under 
Rule 9 of the City Code, which would otherwise have arisen as a result of such conversion. 
The authorised share capital of the Company was further increased by the creation of 2,500,000,000 new ordinary shares of 1p each as 
a result of a resolution passed by the shareholders at the Annual General Meeting held on 30 October 2009.  67 SpiriTel plc Annual report and accounts 2010 
 
 
 
10. Share capital continued 
Preference shares 
All of the outstanding preference shares of the Company were converted to new ordinary shares and cancelled during the year as 
described above. In accordance with FRS 25 the preference shares are considered to be a host debt with an embedded derivative. 
The carrying value of the preference shares in the financial statements is analysed below: 
 
2010
Number 
2009
Number 
Authorised: 
Redeemable preference shares of £1 each – 933,533
Allotted, called up and fully paid: 
Shares classified as financial liabilities  
Redeemable preference shares of £1 each – 933,533
 
 
2010
£000 
2009
£000 
Principal – 934
Redemption premium – 1,025
 – 1,959
Presented as: 
Debt – 1,959
 – 1,959
11. Reserves 
Company  
Share premium 
£000 
Other
reserves
£000 
Profit and
loss account
£000 
At 30 April 2009 4,935 1,965 (13,784)
Retained loss for the year – – (4,643)
Issue of share capital (net of expenses) 6,692 – –
Credit for equity-settled share-based payments – 204 –
Modification and conversion of financial instruments – equity component – 3,768 –
Transfer between reserves – (8) 8
At 30 April 2010 11,627 5,929 (18,419)
12. Share-based payments 
Information regarding equity settled and cash settled share-based payments is provided in note 27 to the consolidated financial 
statements.  68 SpiriTel plc Annual report and accounts 2010 Notes to the Company financial statements continued 
 
 
13. Reconciliation of movements in shareholders’ funds/(deficit) 
 
2010 
£000 
2009
£000 
Retained loss for the financial year (4,643) (9,247)
Credit for equity settled share-based payments 204 204
Modification and conversion of financial instruments – equity component 3,768 1,545
Issue of share capital (net of expenses) 6,807 3,499
Net increase/(decrease) in shareholders’ funds/(deficit) 6,136 (3,999)
Opening shareholders’ (deficit)/funds (608) 3,391
Closing shareholders’ funds/(deficit) 5,528 (608)
14. Capital commitments 
There were outstanding capital commitments of £nil at 30 April 2010 (2009: £nil). 
15. Leasing commitments 
 
2010 
£000 
2009
£000 
Annual commitments under non-cancellable operating leases are as follows:  
Leases of land and buildings expiring:   
Between two and five years 105 105
 
16. Transactions with related parties 
Other related party transactions 
The Company’s related parties include its Directors and companies controlled by or associated with its Directors, as disclosed below. 
Transactions with Directors and related parties in respect of their services as Directors are disclosed in the Directors’ Remuneration 
Report on pages 16 to 18. 
Other related party transactions during the year were as follows: 
Penta Capital LLP, through its managed funds Penta Fund 1 Limited Partnership and Penta Fund 1 SP Limited Partnership (the “Penta 
Funds”) is the holder of 82.3% of the Company’s issued ordinary 1p shares. Steven Scott, a Director of the Company is also a Director 
of Penta Capital LLP. During the year, the Penta Funds converted £6,850,809 of outstanding debt and preference shares into ordinary 
shares in the Company as detailed in note 10. A further £1,000,000 of Penta debt was repaid by the Company in cash. Penta Capital 
LLP also manages various funds which, together with Steven Scott, hold convertible loan notes issued by the Company with an 
aggregate principal amount of £7,565,000. Penta Fund 1 Limited Partnership held options over 100,000 ordinary shares of the 
Company which were terminated during the year. Fees paid to Penta Capital LLP in respect of Steven Scott’s services as a Director of 
the Company are detailed in the Directors’ Remuneration Report on pages 16 to 18. At 30 April 2010, the outstanding balance within 
creditors in respect of these fees was £18,000 (2009: £14,000). 
Alastair Mills, a Director of the Company, holds convertible loan notes with a principal value of £15,000 through his spouse. 
Ronald Smith, a Director of the Company, holds convertible loan notes with a principal value of £25,000 through his spouse. 
Lord St John of Bletso, a Director of the Company, holds convertible loan notes with a principal value of £20,000 through a family trust. 
17. Post balance sheet events 
There were no matters requiring disclosure as post balance sheet events.  69 SpiriTel plc Annual report and accounts 2010 
Notice of Annual General Meeting 
 
NOTICE IS HEREBY GIVEN that an ANNUAL GENERAL MEETING of the shareholders of SpiriTel plc will be held at the offices 
of Hammonds LLP, 7 Devonshire Square, London EC2M 4YH at 10-00 a.m. on 21 October 2010 for the following purposes: 
Ordinary business 
1. to receive the Directors’ Report and Accounts for the year ended 30 April 2010 and the Auditors’ Report thereon; 
2. to reappoint as a Director Steven Maine, who retires in accordance with Article 88 of the Articles of Association; 
3. to reappoint Grant Thornton UK LLP of 4 Hardman Square, Spinningfields, Manchester M3 3EB as the Auditors of the Company 
and to authorise the Directors to fix their remuneration; and 
Ordinary resolutions 
4. the Directors of SpiriTel plc be and they are hereby generally and unconditionally authorised for the purpose of Section 551 of the 
Companies Act 2006 (the “2006 Act”) to exercise all or any of the powers of the Company to allot Relevant Securities (as defined 
below) up to the nominal amount of £250,000. 
The authorities conferred by this resolution shall expire at the conclusion of the next Annual General Meeting of the Company (unless 
previously renewed, revoked or varied by the Company in general meeting) provided that the Company may before such expiry make 
an offer or agreement which would or might require Relevant Securities to be allotted after such expiry and the Directors of the 
Company may allot Relevant Securities in pursuance of such offer or agreement notwithstanding that the authority conferred hereby 
has expired. 
In this resolution the expression “Relevant Securities” means: 
• shares in the Company other than shares allotted pursuant to: 
− an employee share scheme (as defined by Section 1166 of the 2006 Act); 
− a right to subscribe for shares in the Company where the grant of the right itself constituted a Relevant Security; or 
− a right to convert securities into shares in the Company where the grant of the right itself constituted a Relevant Security. 
• any right to subscribe for or to convert any security into shares in the Company other than rights to subscribe for or convert any 
security allotted pursuant to an employee share scheme (as defined by Section 1166 of the 2006 Act). References to the allotment of 
Relevant Securities in the resolution include the grant of such rights. 
Special business 
Special resolutions 
5. the Directors of SpiriTel plc be and they are hereby empowered pursuant to Section 570 of the 2006 Act to allot equity securities 
(as defined in Section 560 of the 2006 Act) wholly for cash pursuant to the authority conferred by Resolution 6 above as if Section 
561(1) of the 2006 Act did not apply to any such allotment provided that this power shall be limited to: 
(i) the allotment of equity securities in connection with a rights issue, open offer or other offer in favour of the holders of ordinary 
shares in the Company on the register of members at such record dates as the Directors may determine and other persons 
entitled to participate therein where the equity securities respectively attributable to the interests of the ordinary shareholders are 
proportionate (as nearly as may be practicable) to the respective numbers of ordinary shares in the Company held or deemed to 
be held by them on any such record dates (which shall include the allotment of equity securities to any underwriter in respect of 
such issue or offer) subject to such exclusions or other arrangements as the Directors may deem necessary or expedient to deal 
with fractional entitlements or any legal or practical problems arising under the laws of any overseas territory, or the requirements 
of any regulatory body or stock exchange or by virtue of shares being represented by depositary receipts or any other matter 
whatever; and 
(ii) the allotment of equity securities (otherwise than pursuant to paragraph (i) above), to any person or persons up to an aggregate 
nominal amount of £250,000;  70 SpiriTel plc Annual report and accounts 2010 Notice of Annual General Meeting continued 
 
 
Notice of Annual General Meeting continued 
The authorities conferred by this resolution shall expire at the conclusion of the next Annual General Meeting of the Company (unless 
previously renewed, revoked or varied by the Company in general meeting) save that the Company may, before such expiry, make an 
offer or agreement which would or might require equity securities to be allotted after such expiry and the Directors may allot equity 
securities in pursuance of any such offer or agreement notwithstanding that the power conferred hereby has expired and this power 
applies in relation to a sale of shares which is an allotment of equity securities by virtue of Section 560(2)(b) of the 2006 Act as if in the 
first paragraph of this resolution the words “pursuant to the authority conferred by resolution 4 above” were omitted. 
By Order of the Board 
A A Booth 
Company Secretary 
Registered Office: 18 King William Street, London EC4N 7BP 
27 September 2010 
 
Notes: 
1 A member of the Company who is unable or does not wish to attend the Annual General Meeting (“AGM”) is entitled to appoint a proxy to exercise all or any of his/her rights to 
attend and to speak and vote on his/her behalf at the meeting. A proxy need not be a member of the Company but must attend the meeting to represent you. A Form of Proxy 
which may be used to make such appointment and give proxy instructions is enclosed with this Annual Report and Accounts. If you do not have a Form of Proxy and believe that 
you should have one, or if you require additional forms, please contact Neville Registrars on 0121 585 1131 from within the UK or 44 121 585 1131 if calling from outside the UK. 
The helpline cannot provide advice on the merits of the business to be transacted at the AGM. A member can only appoint a proxy using the procedures set out in these notes 
and the notes to the Form of Proxy. 
2 Pursuant to Regulation 41 of the CREST Regulations, the time by which a person must be entered on to the register of members in order to have the right to vote at the meeting 
is 6.00 p.m. on 19 October 2010 or 48 hours before any adjourned meeting. Changes to entries on the register of members after that time will be disregarded in determining the 
right of any person to attend or vote at the meeting. 
3 A member may appoint more than one proxy in relation to the AGM provided that each proxy is appointed to exercise the rights attached to a different share or shares held by 
that member. To appoint more than one proxy, you may photocopy the enclosed Form of Proxy. 
4 To be valid any Form of Proxy must be received by hand or by post at Neville Registrars, Neville House, 18 Laurel Lane, Halesowen, West Midlands B63 3DA, no later than 10-
00 a.m. on 19 October 2010 or, if the AGM is adjourned, 48 hours before the time appointed for the holding of the adjourned meeting or (in the case of a poll taken otherwise than 
at or on the same day as the meeting or adjourned meeting) the time determined for the taking of the poll at which it is to be used. 
5 In the case of a member which is a company, the Form of Proxy must be executed under its common seal or signed on its behalf by an officer of the Company or an attorney for 
the Company. 
6 Any power of attorney or any other authority under which the Form of Proxy is signed (or a duly certified copy of such power or authority) must be included with the Form of 
Proxy. 
7 A vote withheld is not a vote in law, which means that the vote will not be counted in the calculation of votes for or against the resolution. If no voting indication is given, your 
proxy will vote or abstain from voting at his or her discretion. Your proxy will vote (or abstain from voting) as he or she thinks fit in relation to any other matter which is put before the 
AGM. 
8 The return of a completed Form of Proxy or transmitting a CREST Proxy Instruction (as described in paragraphs 9 to 12 below) will not prevent a member attending the AGM 
and voting in person if he/she wishes to do so. 
9 CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy should follow the procedures described in the CREST Manual. CREST personal 
members or other CREST sponsored members, and those CREST members who have appointed a service provider(s), should refer to their CREST sponsor or voting service 
provider(s), who will be able to take the appropriate action on their behalf. 
10 In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a “CREST Proxy Instruction”) must be properly 
authenticated in accordance with the specifications of Euroclear UK & Ireland Limited (“Euroclear”), and must contain the information required for such instruction, as described in 
the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or is an amendment to the instruction given to a previously appointed proxy 
must, to be valid, be transmitted so as to be received by Neville Registrars (participating ID 7RA11) by the latest time for receipt of proxy appointments specified in note 4 above. 
For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Application Host) from which the issuer’s 
agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time any change of instructions to proxies appointed through CREST 
should be communicated to the appointee through other means. 
11 CREST members and, where applicable, their CREST sponsors, or voting service provider should note that Euroclear does not make available special procedures in CREST 
for any particular message. Normal system timings and limitations will, therefore, apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST 
member concerned to take (or, if the CREST member is a CREST personal member, or sponsored member, or has appointed a voting service provider, to procure that his 
CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular 
time. In this connection, CREST members and, where applicable, their CREST sponsors or voting system provider are referred, in particular, to those sections of the CREST 
Manual concerning practical limitations of the CREST system and timings.  
12 SpiriTel plc may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001. 
13 In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, only the appointment submitted by the most senior holder will be accepted. 
Seniority is determined by the order in which the names of the joint holders appear in SpiriTel’s register of members in respect of the joint holding (the first-named being the most 
senior).  71 SpiriTel plc Annual report and accounts 2010 
 
 
 
14 To change your proxy appointment simply submit a new proxy appointment using the methods set out above. Note that the cut-off time for receipt of proxy appointments (see 
above) also apply in relation to amended instructions; any amended proxy appointment received after the relevant cut-off time will be disregarded. Where you have appointed a 
proxy using the hard-copy proxy form and would like to change the instructions using another hard-copy proxy form, please contact Neville Registrars on 0121 585 1131 from 
within the UK or 44 121 585 1131 if calling from outside the UK. 
15 If you submit more than one valid proxy appointment, the appointment received last before the latest time for the receipt of proxies will take precedence. 
16 In order to revoke a proxy appointment you will need to send a signed hard copy notice clearly stating your intention to revoke your proxy appointment to Neville Registrars, 
Neville House, 18 Laurel Lane Halesowen, West Midlands B63 3DA. In the case of a member which is a company, the revocation notice must be executed under its common seal 
or signed on its behalf by an officer of the company or an attorney for the company. Any power of attorney or any other authority under which the revocation notice is signed (or a 
duly certified copy of such power or authority) must be included with the revocation notice. The revocation notice must be received by Neville Registrars no later than 48 hours 
before the time appointed for the holding of the meeting or adjourned meeting. If you attempt to revoke your proxy appointment but the revocation is received after the time 
specified then, subject to note 8 your proxy appointment will remain valid. 
17 A corporation which is a member can appoint one or more corporate representatives who may exercise, on its behalf, all its powers as a member provided that no more than 
one corporate representative purports to exercise powers over the same share. 
18 Holders of ordinary shares are entitled to attend and vote at general meetings of the Company. As at 20 September 2010 (being the last practicable date prior to the publication 
of this notice of meeting) the total number of issued ordinary shares is 17,694,410 carrying one vote each. Therefore the total voting rights in the Company as at 20 September 
2010 are 17,694,410. 
19 Except as provided above, members who have general queries about the AGM should call Neville Registrars on 0121 585 1131 (from within the UK) + 44 121 585 1131 (from 
outside the UK). No other methods of communication will be accepted. You may not use any electronic address provided either in this notice of meeting or any related documents 
(including the Form of Proxy) to communicate with the Company for any purposes.  72 SpiriTel plc Annual report and accounts 2010 
Company information and advisers 
 
Secretary and registered 
office: 
A A Booth 
18 King William Street 
London EC4N 7BP 
 
Registered number: 
5035921 
 
Nominated advisers and 
brokers: 
finnCap Limited 
4 Coleman Street 
London 
EC2R 5TA 
 
Bankers: 
Clydesdale Bank PLC 
30 St Vincent Place 
Glasgow G1 2HL 
 
Solicitors: 
Hammonds LLP 
2 Park Lane 
Leeds LS3 1ES 
 
Auditors: 
Grant Thornton UK LLP 
4 Hardman Square 
Spinningfields 
Manchester M3 3EB 
 
Public relations advisers: 
Tavistock Communications Limited 
131 Finsbury Pavement 
London EC2A 1NT 
 
Registrars: 
Neville Registrars Limited 
Neville House 
18 Laurel Lane 
Halesowen B63 3DA 
  SpiriTel plc at a glance
Complete business communications
SpiriTel is a rapidly growing provider of communications services to business 
customers. We offer an award winning range of converged voice, data and 
networking solutions to customers throughout the UK, utilising our nationwide 
network of sales and engineering staff. The Group is also a consolidator of 
the highly fragmented UK telecoms reseller market and has built a substantial 
customer base and operational scale through 12 selective acquisitions, 
all of which have been integrated into SpiriTel’s Business Division.
Strategy
Acquire 
SpiriTel is a consolidator of the fragmented 
UK telecoms reseller market. We acquire 
high quality businesses with attractive 
customer bases and grow through cost 
and revenue synergies. We expect 
all acquisitions to be immediately 
earnings enhancing.
Integrate 
The quick and efficient integration of 
our acquisitions, utilising our bespoke 
integration framework, is key to the rapid 
delivery of their earnings potential. Having 
completed 12 acquisitions, we have a track 
record of successful integration.
Grow 
SpiriTel has experienced rapid growth in 
revenues, earnings and customer numbers 
following the completion of 12 acquisitions. 
We have also delivered significant organic 
growth, despite challenging economic 
conditions, by selling more products and 
services to existing customers.
Business model Accreditations
 
Awards
IP 
Communications Mobile
Network  
Services
SpiriTel  Business
SpiriTel  plc
SpiriTel  
Technologies
Designed and produced by Radley Yeldar
www.ry.com Annual report and accounts  
2010
Acquire
 Integrate
 Grow
SpiriTel plc
18 King William Street
London EC4N 7BP
T +44 (0)20 7160 0100
F +44 (0)20 7929 5469
www.spiritelplc.com
SpiriTel plc Annual report and accounts 2010