Gro up report and accounts Contents
01 Highlights
02 Chairman’ s statement
04 Chief executive’ s review
08 Company overviews
10 Financial review
12 Directors
13 Remuneration committee’ s report
14 Corporate governance report
16 Directors’ report
19 Statement of directors’ responsibilities
20 Independent auditors’ report
21 Consolidated profit and loss account
22 Consolidated statement of total recognised gains and losses
22 Consolidated reconciliation of movements in shareholders’ equity
23 Consolidated balance sheet
24 Balance sheet
25 Consolidated statement of cash flows
25 Reconciliation of net cash flow to movement in net funds
26 Notes to the financial statements
48 Directors and advisers
49 Notice of annual general meeting
Imprint Plc | Contents Group report and accounts 2006 | 1
Financial highlights:
Turnover up 46.1%
Turnover up 46.1% to £80.1 million
(2005 – £54.8 million)
Gross profit up 41%
Gross profit (net fee income) up 41.0% to £44.9 million
(2005 – £31.8 million)
• Gross profit from 2005 acquisitions up 43.2% to
£26.9 million (2005 – £18.8 million)
• Gross profit from organic business up 32.6% to
£17.3 million (2005 – £13.0 million)
Adjusted operating profit
up 64.1%
Operating profit before amortisation of goodwill,
share-based payment charge and exceptional items up
64.1% to £11.6 million (2005 – £7.1 million)
Adjusted pre-tax profit
up 61.6%
Profit before amortisation of goodwill and exceptional
items up 61.6% to £11.3 million (2005 – £7.0 million)
Pre-tax profit up 109%
Pre-tax profit up 109% to £9.1 million
(2005 – £4.4 million)
Diluted EPS up 136%
Diluted EPS up 136% to 17.0p
(2005 – 7.2p)
Diluted EPS (adjusted for exceptional items and
amortisation of goodwill) up 65.2% to 22.3p (2005 – 13.5p)
Finaldividend: 2.6p per share
Final dividend of 2.6p per share
(2005 – 2.0p maiden dividend)
Strong balance sheet with
cash of £4.3 million
Business highlights:
Year of consolidation and
delivery for the Group
Integration of 2005
acquisitions complete
Common shared service functions
and new support systems
established and fully operational
Strong growth in organic
business, particularly in Asia
Businesses acquired and
offices opened in 2005 also
growing strongly
Dubai-based executive search
and contingent recruitment
businesses acquired in July
Fee generating headcount increased
by 21% to 375 (2005 – 310)
Ongoing consideration of
appropriate fit acquisition
opportunities to facilitate expansion
Promising trading conditions
continuing in 2007
Imprint Plc | Highlights 2 | Group report and accounts 2006
Imprint Plc | Chairman’ s statement
Gross profit (net fee income)
up 41% to £44.9 million
(2005 – £31.8 million) Group report and accounts 2006 | 3
Imprint Plc | Chairman’ s statement
Introduction
I am pleased to report that Imprint
delivered a strong set of results for the
year ended 31 December 2006. This
strong performance was driven by
sector leading revenue growth both
from our organic and acquired
businesses, a doubling in net fee
income from our Asian operations and
a triple digit increase in pre-tax profits.
2006 was a year when our Group
delivered on its considerable potential.
Following the acquisition of three
businesses in 2005, the focus in 2006
was on delivering organic growth from
all of our businesses, particularly
through gains in market share and
a significant expansion in Asia.
During the year we continued to invest
in the Group’ s global operations, both in
the front and back offices, as we strive
to increase and maximise potential
earnings over the course of the cycle.
Over the last 12 months we have
increased our fee generating headcount
by 21%, up from 310 at 31 December
2005 to 375 at 31 December 2006.
Including directors and support staff,
the Group employed 480 staff at
31 December 2006, operating from
14 offices in eight countries.
As is the case with most successful
businesses whose primary assets are its
people, Imprint’ s achievements in 2006
are entirely the result of the dedication,
efforts and loyalty of the Group’ s
employees, and I should like to take this
opportunity to thank them all.
Financial highlights
Adjusted earnings per share (being
diluted earnings per share adjusted for
goodwill amortisation and exceptional
items) were 65% higher than 2005 at
22.3 pence. Diluted earnings per share
were 17.0 pence, up 136%.
Turnover increased by almost 50% to
£80.1 million through a combination of
strong organic growth and the full year
impact of the acquisitions of ECHM
and Morgan McKinley in 2005, which
together trade a significant volume of
temporary placements. Net fee income
(gross profit) increased by 41.0% to
£44.9 million, which included growth in
the non-acquired business of 32.6%,
from £13.0 million to £17.3 million.
Across the Group’ s primary markets of
the United Kingdom and Europe, net
fee income in the second half of 2006
increased by 24.3%, from £16.1 million
to £20.1 million, with both our organic
businesses and the businesses we
acquired in 2005 gaining market share.
I am pleased to report a full year
operating margin (being the conversion
rate of net fee income into operating
profit
1
) of 25.8% (2005 – 22.2%) and an
operating profit
1
of £11.6 million, up
64.1% (2005 – £7.1 million), which have
been achieved alongside continued
investment in our fee generating
capabilities. The growth in the margin
has been achieved thanks to positive
returns on investments made in
previous years and the financial benefits
which have been derived from all of our
businesses working closer together in
the sourcing of client and candidate
opportunities and the sharing of
overheads and group services.
Profit before tax increased by 109% to
£9.1 million (2005 – £4.4 million) after a
£1.8 million charge for goodwill
amortisation, a £0.3 million charge for
share-based payments and £0.4 million
of exceptional costs resulting from a
decision we took late last year to
relocate the London-based operations
of ECHM, Morgan McKinley and our
group shared service functions into the
same premises. This decision will
facilitate even closer cooperation
between our contingent recruitment
businesses (which share a similar
candidate pool) and our back office
functions, will reduce overheads and
will result in approximately 70% of our
London-based staff being located in the
same building.
The Group’ s balance sheet at 31
December 2006 was strong, with net
current assets of £15.2 million (2005 –
£9.4 million), cash of £4.3 million (2005
– £3.2 million), and banking facilities
available to the Group of £7.5 million.
The Board declared an interim dividend
of 1.3 pence per share and is proposing
to pay a final dividend of 2.6 pence per
share (2005 – maiden dividend of 2.0
pence), taking the total dividend for the
year to 3.9 pence per share. The final
dividend will be paid on 18 May 2007 to
those shareholders on the register at
20 April 2007.
Acquisition
On 19 July 2006, Imprint acquired the
Ingram Consultancy, one of the United
Arab Emirates’ leading recruitment
businesses. This acquisition has
provided Imprint with a strategic entry
point into the high growth Dubai and
Gulf Cooperative Community markets
and has further broadened the scope of
the services we offer to our commercial
and financial services clients.
Initial consideration paid was £900,000
in cash and by the issue of 115,924 new
ordinary Imprint shares. Further
potential consideration of up to £3.8
million is payable in a combination of
cash and new ordinary shares,
contingent upon the financial
performance of the acquired business
in the year ended 31 December 2006
and the years ending 31 December 2007
and 2008. No consideration is due for
performance in the year ended
31 December 2006.
The Ingram Consultancy trades as two
businesses, iQ selection, which provides
contingent recruitment services in the
region, and an executive search
business which has recently been
rebranded as WoodHamill Ingram to
reflect the international talent search
capabilities which the Group can now
provide in this geographical region.
Current trading and outlook
All of the markets and regions in which
the Group operates continue to be
buoyant and the short term outlook for
the Group is therefore encouraging.
Imprint is well placed to continue to
grow earnings and continue its
expansion in 2007 by further increasing
headcount and by enlarging the scope
of its service offerings, thereby
diversifying its revenue streams. The
Board is actively investigating new
office openings and continues to review
selective acquisitions that meet the
Group’ s strict cultural, operational and
valuation criteria.
I look forward to 2007, as Imprint seeks
further to increase market share in its
established markets, while also growing
in new sectors and geographies.
Pierce Casey
Chairman
23 February 2007
1
before exceptional items, share-based payment charges and amortisation of goodwill
Chairman’ s
statement 4 | Group report and accounts 2006
Adjusted operating profit up 64.1% to £11.6 million
(2005 – £7.1 million)
Chief
executive’ s
review
Imprint Plc | Chief executive’ s review Group report and accounts 2006 | 5
Imprint Plc | Chief executive’ s review
Introduction
2006 has been a successful year for
Imprint, as we capitalised on favourable
market conditions across the Group’ s
markets and delivered a healthy return
on investments made in prior years (in
businesses, offices and headcount). Our
focus was to drive gains in market share
through organic growth in each of our
operations, both in the United Kingdom
and overseas and thereby to achieve
sector leading revenue growth. At the
same time we have continued to invest
for the future, through increased
headcount, new office space, improved
systems and a determined expansion
strategy in Asia.
We have successfully continued to
diversify our revenue streams, both
geographically and through the types of
recruitment service we provide, whilst
still maintaining our client focus on
blue chip organisations. This approach
has remained consistent throughout
our trading history and provides us with
greater resilience as well as substantial
opportunities for further sustainable
growth. We continue to pride ourselves
on the provision of the highest levels of
client service and we are fortunate to
have a dedicated and talented workforce
to drive this growth going forward.
Employee and office information
Largely through investment in new staff
and new disciplines as well as the
acquisition of the Ingram Consultancy,
the Group has increased its headcount
by 24%. At the end of the year, the
Group employed 375 (2005 – 310) fee
generating staff and 105 (2005 – 77)
directors and support staff, operating
from 14 (2005 – 13) offices in 8
(2005 – 7) countries.
Business review
Having achieved our primary
integration objectives in 2005, the
operational focus for 2006 was to
deliver sector leading growth across
each of our markets, whilst at the same
time selectively investing in headcount
in new and established business areas.
Our belief is that the retention of strong
individual brand identities operating
within a multi-functional international
recruitment group offers the best
opportunities for long-term growth,
providing career development
opportunities for our staff, cross-brand
participation in client management and
candidate sharing and efficient
common back office support.
Whilst we will continue to invest where
appropriate in our back office systems
in order to achieve greater efficiencies,
the integration of our shared service
functions is now complete. For
example, our decision to establish a
dedicated training and development
function has resulted in a significant
increase in the amount of time
provided to equip our people with the
skills they need to service our clients
fully and to reach their individual
potential. It has also had the knock on
effect of helping to keep our staff
retention levels amongst the highest
in the industry.
We are very pleased with the
performance of the three acquisitions
completed in 2005. In total, net fee
income from Accreate, ECHM and
Morgan McKinley rose 26.0% in the
second half of 2006 compared to the
comparative period, which is ahead
of average industry growth in these
regions over this period and
demonstrates an increase in market
share for these businesses.
United Kingdom and Europe
In total, turnover in the UK and Europe
was £74.6 million (2005 – £52.2 million),
an increase of 43.0%, and net fee
income was £39.5 million (2005 – £29.3
million), an increase of 34.6%.
Operating profit before exceptional
costs, share-based payments and
amortisation of goodwill increased by
55.8% to £10.5 million (2005 – £6.8
million) and was £8.1 million after these
costs (2005 – £4.0 million).
Morgan McKinley enjoyed a highly
successful year, benefiting from its
position as a leading supplier of back
office recruitment services to financial
services institutions in a year where
hiring in this sector in the United
Kingdom reached a record high.
Morgan McKinley’ s business is
principally driven by numerous
preferred supplier agreements (“PSA ”)
which provide the framework to enable
it to deliver multiple recruitment
product offerings to its clients. These
underpin its position as a leading
recruitment company within its market
and provide a major barrier to entry to
Morgan McKinley’ s potential
competitors. During the course of the
year, Morgan McKinley increased the
number of its PSAs by approximately
15% and transacted a significantly
higher number of ‘volume’ recruitment
projects than in 2005.
Furthermore, Morgan McKinley
developed its service offerings within its
markets, launching new specialisms in
HR, commodities and insurance, all of
which were profitable in their first year
and all of which will help complement
Morgan McKinley’ s traditional
stronghold in investment banking
through diversification into new
revenue streams.
Operationally, Morgan McKinley had a
strong year. As well as a 27% growth in
permanent placement revenue, the
number of temporary workers and
contractors at clients at the year end
was 28% higher than at the end of 2005.
Margins on temporary placements
increased slightly from 2005.
Our ECHM business, which specialises
in financial recruitment into blue chip
corporates and the global accounting
practices across the United Kingdom
and in the Netherlands, also had a
successful year. In London and
Amsterdam, like for like net fee income
increased by 32% and operating margin
increased from 15% to 20%. ECHM’ s
professional services businesses, which
recruit finance professionals typically
into tax, audit and corporate finance
roles within accountancy practices, is
now the market leader in the south east
of England. In this region, ECHM by the
year end had also doubled the number
of temporary placements out with
clients compared with the end of 2005. 6 | Group report and accounts 2006
Imprint Plc | Chief executive’ s review
ECHM’ s Dutch operations performed
ahead of expectations, increasing net
fee income by 110% on 2005. We are
optimistic about our future growth
potential in this region, so we took the
decision late in 2006 to move into larger
offices in order to provide sufficient
accommodation for our headcount
growth plans and to accommodate the
roll out of the Morgan McKinley brand
in this region during 2007. This move
was completed in February 2007.
Accreate, which we acquired in
September 2005, continued to thrive in
the buoyant Dublin economy with its
primary focus being on financial
recruitment in the corporate and
financial services sectors. Annualised
net fee income increased by 59%. At the
end of 2006, Accreate launched two new
product lines, HR and Legal. Although
in their infancy, both of these service
offerings should enable Accreate to
continue its growth momentum and
their introduction is consistent with the
Group’ s wider strategy of diversifying its
revenue streams from strong existing
client relationships and recognised
brand expertise.
Imprint Search & Selection and
WoodHamill, our retained executive
search businesses, together produced
solid growth during the year of 20%. We
invested in additional headcount across
a number of functional specialisms
which were launched in 2005 –
examples included our HR, T echnology
and Wealth Management practices.
Both of our organic brands have
continued to develop the range of
executive recruitment solutions they
can provide to their strong multi-
national client bases, predominantly
serviced from London but utilising local
search capabilities from Imprint’ s wider
office network to provide a full service
offering. In 2006, approximately 17% of
Imprint Search & Selection’ s net fee
income originated from continental
Europe, demonstrating its non-UK
capabilities.
As has been well documented
elsewhere, this recent period of the
recruitment cycle has witnessed a
general shortage of appropriately skilled
professionals available to fill new roles
within the sectors in which Imprint
operates. As a Group we have had to
adapt our working methodologies to
source the best talent for our clients.
Key to this has been the emphasis we
have placed on the sharing of candidate
information, both within the United
Kingdom and overseas. We now have a
dedicated research team which is based
out of London but which is responsible
for both sourcing and placing
candidates on an international basis.
Where appropriate (typically in the
newly qualified accountants market) we
have also actively raised our brand
awareness in countries where we do not
have an office presence, for example in
Australia and South Africa.
Asia Pacific and the Middle East
Our operations across Asia and the
Middle East have grown strongly during
the period, with net fee income of £5.4
million being 115% higher than 2005
(£2.5 million). This growth was largely
organic, with the acquisition of the
Ingram Consultancy in Dubai adding
£0.68 million to revenue. The region’ s
operating profit was £1.1 million, up
from £0.3 million in 2005, which
represents a conversion rate of 19.6%
(2005 – 12.3%).
We continue to invest across this region,
and during the first half of the year we
increased our capacity in T okyo through
additional office space as well as moving
into permanent premises in Singapore
at the start of the year. By the end of the
year, we employed 66 fee generating
staff across our four offices in this region
(2005 – 33 staff in three offices).
Market conditions were buoyant across
the Asian region throughout the course
of the year with all three of our offices
experiencing similar pressures on
skilled candidate supply for the number
of new jobs coming onto the market.
We expect this trend to continue during
2007, with financial institutions in
particular expecting to run multiple
hire recruitment campaigns for mid to
junior level finance and operations
roles, which will involve overseas
sourcing as well as local hiring as the
talent pools increase and improve.
Strategy
Our strategy remains unchanged. We
continue to build and develop a multi-
tiered, international recruitment
business that provides a diverse range
of functional offerings to blue-chip
clients, ensuring that the Group’ s
potential earnings are maximised over
the business cycle. Where appropriate,
we will continue to invest in each of our
businesses’ operating functions if we
believe this will deliver earnings growth
in the short and long term, whilst also
aiming to continue to deliver top
quartile operating profit conversion.
There remains a wide range of
opportunities to grow the Imprint
group in new markets and to take
further market share in the regions in
which we currently operate. We are
currently investigating the feasibility of
opening a limited number of new
offices in the Asia region during the
course of 2007 and early in 2008. We are
continuing to review acquisition
opportunities that meet our strict
cultural and valuation criteria and
operationally allow us access either to
new recruitment sectors or to new
geographical markets.
The Group intends to remain focused
on its core competency of providing
high quality business recruitment
solutions in the professional services,
commerce and financial services
sectors. We will therefore continue to
operate our recruitment, training and
development programmes so as to
enable us to continue to attract and
retain the best talent available and
maintain an above-average staff
retention rate. I look forward to the year
ahead with confidence as we build on
previous achievements, expand our
global capabilities and target higher
returns to all stakeholders.
Brian Hamill
Chief Executive Officer
23 February 2007 Group report and accounts 2006 | 7
Imprint Plc | Chief executive’ s review
Fee generating headcount
increased by 21% to 375 (2005 – 310) 8 | Group report and accounts 2006
Imprint Plc | Name of section Imprint Plc | Company overviews
www.accreate.com
Accreate was founded in 2001.
It provides financial recruitment
solutions to blue-chip clients within
the commerce & industry, financial
services and professional services
sectors in Ireland, on both a permanent
and temporary basis and at all levels
from graduate to director.
Accreate has developed strong
relationships with the leading
employers in the marketplace with over
50% of revenues deriving from the top
20% of its clients.
Accreate was acquired by Imprint in
September 2005.
www.echm.com
ECHM is a market leader in financial
recruitment and was acquired by
Imprint in January 2005. With over 20
years trading history and offices across
the UK and in Continental Europe,
ECHM provides a unique range of
permanent, temporary, and contract
recruitment solutions to a client base
comprising primarily multinational
blue chip corporates and the global
accounting practices.
Using methodologies including
retained search, advertised selection,
and database search, ECHM places part
qualified, newly qualified and senior
finance professionals through
dedicated teams covering the following
sectors and functional specialisms:
• Commerce & industry – commercial
finance, taxation and internal audit
• Professional services – audit &
assurance, taxation and corporate
finance
• Public sector – NHS, local
government and not for profit
The brand operates from offices in
London, Birmingham, Leeds,
Manchester, Windsor and Amsterdam.
www.imprintsearch.com
Imprint Search & Selection delivers
bespoke search, selection, project
resourcing and interim executive
recruitment solutions to clients ranging
from private equity-backed start-ups to
FTSE 100 multinationals across the
commerce and industry and
professional services sectors.
Imprint Search & Selection offers
functional expertise across the typical
core management disciplines of its
clients. Each practice listed below
comprises experienced consultants
who in turn have sector-specific
knowledge, resulting in faster solutions
to each individual assignment, broadly
in the £70,000 to £150,000 salary range.
The brand operates from offices in
London, Birmingham, Leeds,
Manchester, Windsor and T okyo under
the following specialisms:
• Finance
• Human resources
• Interim management
• Engineering & manufacturing
• Marketing
• Operations
• Professional services
• Sales
• Strategy
• T echnology
Companies Group report and accounts 2006 | 9
Imprint Plc | Name of section Imprint Plc | Company overviews
www.iqselection.com
iQ selection provides focused
recruitment services to clients and
candidates throughout the Gulf region
on a non-retained selection basis. It
employs a tailored process to ensure
that clients make the right recruitment
decisions for their organisations, and
that candidates are given access to the
best career opportunities in their field
of expertise.
Their consultants are highly trained
specialists in the following areas:
• Banking
• Finance
• Sales
• Marketing
• Advertising & PR
• Construction
• IT & telecommunications
• Human resources
• Executive secretarial
• Oil & gas
iQ selection consistently demonstrates
a commitment to outstanding service
delivery and strong professional and
ethical values. It strives to build lasting
relationships with candidates and
clients and their commitment and
reliability to both means they keep
coming back for more.
iQ selection was acquired by Imprint in
July 2006 as part of the Ingram
Consultancy and operates from offices
in Dubai.
www.morganmckinley.com
Morgan McKinley is the leading
specialist in banking and financial
services recruitment. Its commitment
to quality and its specialist knowledge
of industry sectors is second to none.
Its reputation for delivering an
unsurpassed level of service is well
known and has led to its status as
preferred supplier to over 200 financial
institutions in the City. Morgan
McKinley was acquired by Imprint in
April 2005 and operates from offices in
London, Edinburgh, Hong Kong, T okyo
and Singapore.
Morgan McKinley delivers permanent,
temporary, contract, campaign,
contingency, retained and search
recruitment solutions in the
following areas:
• Asset management including
alternative investment, private
wealth management, private
banking and global custody
• Banking finance & accountancy
including part-qualified, newly-
qualified and senior hires
• Banking operations
• Commodities
• Credit
• Human resources
• Investment banking & capital
markets
• Legal & compliance
• Risk
• Secretarial & support
www.woodhamill.com
From offices in London, Dubai and
Asia, WoodHamill provides executive
search for senior front office financial
services and board level commerce and
industry appointments.
A truly international business, with
consultants from more than a dozen
nations, fluent in twice as many
languages, WoodHamill completes
mandates across the globe for some of
the world’ s largest financial institutions
as well as M&A boutiques, private
equity firms and asset management
houses under the following
specialisations:
• Advisory
• Board practice
• Global capital markets
• Private equity
• Quantitative analysis, risk &
infrastructure
• Wealth management
WoodHamill operates in Dubai
under the WoodHamill Ingram brand.
In July 2006, Imprint Plc acquired
Ingram Executive Search, part of the
Ingram Consultancy, which was
established in 1994 as the first bespoke
search consultancy operating in the
Middle East.
“iQ selection was acquired by
Imprint in July 2006 as part of
the Ingram Consultancy.” 10 | Group report and accounts 2006
Imprint Plc | Financial review
Financial review
Accounting convention and policies
The financial statements for 2006 have
been prepared for the last time under
United Kingdom Accounting Standards.
The interim results and the financial
statements for 2007 will be prepared
under International Financial Reporting
Standards, the impact of which is
discussed below.
The accounting policies are the same as
those in place for the year ended 31
December 2005, with the exception of
share-based payments to employees
which are now accounted for under FRS
20 (IFRS 2). Applying Black-Scholes
valuation models to the Group’ s share
option and equity incentive plans has
provided a fair value charge which in
accordance with FRS 20 has been added
to administrative expenses in each
financial year as highlighted on the
profit and loss account. There is no
effect on equity shareholders’ funds at
any balance sheet date and prior year
comparatives have been restated for
this change in accounting policy.
The directors have reconsidered the
presentation of the shares to be issued
in respect of deferred consideration in
light of the presentation requirements
of FRS 25. These shares were previously
included as part of Shareholders’ equity
but now form part of provision for
liabilities and charges. The effect on the
financial statements for the year ended
31 December 2005, in both the
consolidated and Company balance
sheets, is to decrease Shareholders’
equity by £1,721,000 and increase
provisions for liabilities and charges
by the same amount. There has been
no effect on the profit for the year
ended 31 December 2005 as a result
of this adjustment.
Results
2006 was a very successful year with all
regions and brands (both ongoing and
acquired) delivering strong growth.
Turnover for the year, which was £80.1
million (46.2% higher than 2005), was
wholly derived from recruitment
activities, including search and
selection, contingency recruitment,
temporary placements and contract
fees, as well as ancillary services such as
recharged advertising costs. It includes
the remuneration cost of contract
candidates and the total cost of
advertising recharged to clients.
Turnover from temporary placements
and contract fees was £43.5 million
(2005 – £28.1 million) and represented
54.4% (2005 – 51.2%) of Group turnover.
Turnover from permanent placements
(retained and contingent) was £36.6
million (2005 – £26.5 million) and
represented 45.6% (2005 – 48.8%) of
Group turnover. Turnover grew by 8.6%
(2005 – 50%) in the second half of the
year, which generated 52% of the
annual total (2005 – 60%).
Gross profit (net fee income) for the
year increased by 41% to £44.9 million
(2005 – £31.8 million). This represents a
gross margin of 56.0% (2005 – 58.1%),
the variance from the previous year
predominantly being explained by the
inclusion of Morgan McKinley, which
has a significant temporary placements
business, in the Group results for a full
12 months. Gross profit from temporary
placements and contract fees was £8.9
million (2005 – £5.6 million) and
represented 19.8% (2005 – 17.5%) of
Group gross profit. On temporary
placements, the gross margin was
20.4% (2005 – 19.9%).
Operating profit
2
for the year increased
by 64.1% to £11.6 million (2005 – £7.1
million), representing an operating
margin (being the conversion rate of
net fee income into operating profit
2
) of
25.8% (2005 – 22.2%). £4.2 million (2005
– £3.0 million) was generated from the
Group’ s organic businesses, at a margin
of 24.1% (2005 – 23.3%) and the balance
was generated from acquisitions in 2005
and 2006, at a margin of 27.0%. The
operating profit from the organic
businesses was achieved after
significant further investment in
headcount across a variety of our
operating functions throughout 2006.
The Group has recognised a £1.8
million charge for amortisation on the
gross cost of goodwill of £36.8 million
which arose on the acquisitions of
ECHM, Morgan McKinley, Accreate and
the Ingram Consultancy. The Group has
also provided for £0.4 million of
exceptional costs resulting from a
decision taken late in 2006 to collocate
ECHM, Morgan McKinley and the
Group’ s common back office functions
in the same London office (the costs
equate to an onerous lease provision on
ECHM’ s current London premises
which the Group now plans to sub-let).
After these items, operating profit
for the year was £9.1 million
(2005 – £4.4 million).
Net interest payable during the year was
£40,000 (2005 – £85,000 net interest
receivable). This was comprised of
non-utilisation fees, interest and
amortisation of the arrangement fee on
the Group’ s £7.5 million revolving credit
facility, offset by interest receivable on
rental deposits and bank interest, as
well as interest receivable and payable
on the Group’ s loan note deposits and
matching liabilities.
T ax on profits amounted to £2.4 million
(2005 – £1.8 million), representing an
effective tax rate of 22.1% (2005 – 31.8%)
on profit before amortisation of
goodwill (which is not deductible). The
effective rate was significantly lower in
2006 mainly due to statutory relief
available in the United Kingdom on the
exercise of share options by employees
and an increased proportion of profits
arising in foreign operations with lower
tax rates. The rate has also benefited
slightly from the utilisation and
recognition of tax losses from previous
years (not all of which had been
recognised in the deferred tax balance
at 31 December 2005).
In 2006, basic earnings per share were
18.2p (2005 – 7.9p) and were 23.8p
(2005 – 14.8p) after adjusting for
amortisation of goodwill and
exceptional costs. Adjusted diluted
earnings per share (after tax but before
amortisation of goodwill and
exceptional costs) were 22.3p (2005 –
13.5p). The weighted average number of
shares for the year increased to 36.79
million (2005 – 32.38 million), following
the issue of 1.07 million shares at
various stages during the year related to
the acquisitions of Accreate and the
Ingram Consultancy and the exercise of
share options as described in note 17 to
the financial statements. The Company
ended the year with 37.30 million
shares in issue.
As outlined in the Chairman’ s
Statement, Imprint has announced
its intention to declare a final dividend
of 2.6p per share in respect of 2006
(2005 – maiden dividend of 2.0p). This
dividend will be paid on 18 May 2007 to
those shareholders on the register at 20
April 2007.
2
before exceptional items, share-based payment charges and amortisation of goodwill Group report and accounts 2006 | 11
Imprint Plc | Financial review
Diluted EPS (adjusted for exceptional items and amortisation of goodwill)
up 65.2% to 22.3p (2005 – 13.5p)
Financial position and cash flow
The financial position of the business
remains tightly controlled. The Group’ s
balance sheet has strengthened during
the year. At 31 December 2006 net
assets amounted to £48.6 million (2005
– £42.6 million), including cash and
short-term deposits of £4.3 million
(2005 – £3.2 million). The increase in
net assets predominantly relates to the
profit of £6.7 million and the issue of
shares with a value of £1.0 million,
offset by dividends paid to shareholders
amounting to £1.2 million. The Group
also has a £7.5 million revolving credit
facility which can be used for working
capital requirements or for acquisitions.
In line with increased trading volumes,
the Group’ s working capital expanded
during the year. Trade debtors at 31
December 2006 amounted to £13.4
million (2005 – £9.9 million), which was
48 days sales (2005 – 45 days). Accrued
income (uninvoiced revenue)
amounted to £4.6 million (2005 –
£3.8 million).
Cash generated in 2006 was
£1.1 million (2005 – £0.7 million),
including generation of £7.7 million
(2005 – £4.3 million) from operating
activities and a net £0.1 million (2005 –
£26.9 million) from share issues. £2.2
million of funds generated were spent
on acquisitions (2005 – £30.1 million)
and £0.9 million (2005 – £0.5 million)
on capital expenditure. T ax paid was
£2.3m (2005 – £nil) and dividends were
paid to shareholders amounting to £1.2
million (2005 – £nil). Cash surpluses
are invested where practical in short-
term deposits.
The main functional currencies of the
Group are Sterling, Euro, US Dollar,
Hong Kong Dollar, Japanese Yen and
Singapore Dollar. The Group does not
have material transactional currency
exposures nor is there a material
exposure to foreign-denominated
monetary assets and liabilities. The
Group is exposed to foreign currency
translation differences in accounting for
its overseas operations although our
policy is not to hedge this exposure.
International Financial Reporting
Standards (“IFRS”)
The Group is required to prepare its
reported financial statements under
IFRS for the year ending 31 December
2007. Consequently, Imprint will adopt
IFRS in its consolidated financial
statements from 1 January 2007, with
the first reported results under IFRS
being our interim statement later
this year.
During 2006 we reviewed the impact of
adopting IFRS both on the Group’ s
financial statements and the
methodologies used for recording
financial and related information.
The following areas that will have a
material impact on the Group’ s
financial statements have been
identified. This summary is not
intended to be comprehensive.
• Goodwill amortisation – under UK
GAAP , the Group’ s policy is to
amortise capitalised goodwill
resulting from any post-balance
sheet acquisitions on a straight-line
basis over its estimated useful
economic life. On transition to IFRS,
IFRS 1 “First-time Adoption of
International Financial Reporting
Standards” requires the Group to
review the carrying value of
capitalised goodwill for potential
impairment. Furthermore, in
accordance with IFRS 3 “Business
Combinations” , amortisation of
goodwill will no longer be charged
in the Group’ s consolidated profit
and loss account. Under IFRS,
instead of an annual charge to
the profit and loss account, an
impairment review will be carried
out at each balance sheet date, and
this is required irrespective of there
being an indicator of impairment
in existence. If impairment is
identified, a charge will result in
the profit and loss account.
• Intangible assets arising on
acquisitions – with the adoption of
IFRS 3 and IAS 38 “Intangible Assets” ,
separately identifiable intangible
assets acquired as part of
acquisitions from 1 January 2006
will be recognised at their fair value,
separately from goodwill.
• Fixed assets – under IFRS the
Group’ s computer software will need
to be reclassified from tangible fixed
assets to intangible fixed assets.
Colin Webster
Chief Financial Officer
23 February 2007 12 | Group report and accounts 2006
Imprint Plc | Directors
Pierce Casey
Non-Executive Chairman
Age 51
Pierce Casey, a chartered accountant, is
a private equity specialist and
entrepreneur. He is a director of
Alchemy Venture Partners and was
previously a director of Apax Partners &
Co and DCC. He was a founding
shareholder of Walker Hamill and
founder of Fayrewood Plc. He is a
founder and chairman of Getmobile
Europe Plc and has been involved in the
creation of several successful
businesses in the UK and Europe.
Brian Hamill
Chief Executive Officer
Age 42
Brian Hamill, a business studies
graduate, founded Walker Hamill, aged
24, in London in 1989 and built it into
an international recruitment business
with an exceptional reputation for
delivery amongst blue chip clients.
Following its sale to Marlborough
International Plc in 1998, he was
appointed to its board, where his remit
included responsibility for international
acquisitions and management of group
operations in Europe. He led the
flotation of Imprint Plc in May 2001
with a vision to build a multi-tiered
recruitment group, creating strong
lasting partnerships with clients on a
global basis. The business was the first
start-up recruitment company ever to
be listed on AIM.
John Hunter
Chief Operating Officer
Age 39
John Hunter spent ten years at Ernst &
Young including six years in its
corporate finance department, advising
on national and cross border
transactions. His principal clients
included British Airways Plc, where he
spent some two years advising on the
establishment of the joint ventures
within Oneworld. John left Ernst &
Young to co-found a new media
business in January 2000 and joined
Imprint in September 2001 as Chief
Financial Officer and was promoted to
Chief Operating Officer in August 2004.
Colin Webster
Chief Financial Officer
Age 35
An engineering graduate and qualified
chartered accountant, Colin Webster
spent eight years with Ernst & Young in
the London and Cape T own offices
advising entrepreneurial high growth
companies, particularly those in the
recruitment and support services
sectors, on the financial aspects of
their strategies, including fundraising,
acquisitions, restructuring and
disposals. Colin joined the company
in September 2004 as Chief
Financial Officer.
Robert Thesiger
Executive Director
Age 36
Robert Thesiger, a graduate of Exeter
University and Cranfield Business
School, has worked in the recruitment
industry for over 12 years. He joined
Morgan McKinley in 1998 after five
years at Badenoch & Clark where he
established their Financial Services
business and managed their Banking
T emporaries department. At Morgan
McKinley, Robert built up the
consultancy’ s temporary business to be
one of the top three providers of
temporary professionals to the City of
London with a turnover in excess of
£20m. Appointed Chief Executive in
2003, Robert was instrumental in
significantly increasing Morgan
McKinley’ s market share during this
period and in turn, the sale to Imprint
in April 2005.
John Gordon
Non-Executive Director
Age 67
John Gordon, a chartered accountant,
is non-executive chairman of UCM
Group Plc and Lavendon Group Plc
and also a non-executive director of
Alizyme Plc. His previous career was in
corporate finance in the City of London
culminating in his being one of the
founders of Beeson Gregory Limited,
the specialist stockbroking firm,
of which he was Head of Corporate
Finance from the inception of the firm
in 1989 until his retirement in 1996.
Directors Imprint Plc | Remuneration committee’ s report
Group report and accounts 2006 | 13
The Committee consists of John
Gordon (Chairman) and Pierce Casey.
Neither member of the Committee has
any conflict of interests arising from
cross-directorships.
Objectives and remuneration policy
The main aim of the Committee is
to attract, retain and motivate high
calibre individuals with a competitive
package of remuneration comprising
basic salary, incentives and rewards
which are linked to the overall
performance of the Group but also
recognise individual performance and
responsibility. In addition to individual
performance, reference is made to pay
levels in companies of similar size and
to suggestions of appropriate external
remuneration consultants.
The Board believes that the total
remuneration package aligns the
executive directors’ interests with
those of the shareholders and gives
these individuals keen incentives to
perform at the highest levels.
This report should be read in
conjunction with note 4 to the financial
statements and the disclosures made in
the Report of the Directors from pages
16 to 18 regarding information specified
by law on directors’ remuneration and
transactions with the Group, which
give full details of all elements in the
remuneration package of each director
and details of directors’ share interests
and share options.
By order of the Remuneration
Committee
John Gordon
Chairman
23 February 2007
Remuneration
committee’ s
report 14 | Group report and accounts 2006
Imprint Plc | Corporate governance report
Turnover up 46.1% to £80.1 million (2005 – £54.8 million) Group report and accounts 2006 | 15
Imprint Plc | Corporate governance report
The directors recognise the value of the
Principles of Good Governance and
Code of Best Practice (the “Combined
Code”) and, although as an AIM listed
company it is not required to comply
with the Combined Code, Imprint is
taking appropriate measures to ensure
that the Group adopts those principles
of the Combined Code that it considers
appropriate for a group of its size.
This statement describes the principles
identified in the Combined Code which
are being applied.
Board composition
The Board of Directors currently
comprises four executive and two non-
executive directors, with the roles of
Chairman and Chief Executive
separated. The Board meets at least
eight times per annum and additionally
where necessary . The Board has
responsibility for the overseeing of all
day to day matters of the Company but
it has specific responsibility for
reviewing trading performance,
resources (including key
appointments), standards of conduct,
ensuring adequate funding, setting and
monitoring strategy, examining major
acquisition possibilities and reporting
to shareholders. The non-executive
directors have a responsibility to ensure
that the strategies proposed by the
executive directors are fully considered
and to bring their judgement to bear in
this role. T o enable the Board to
discharge its duties, all directors receive
appropriate and timely information
from the management of the Group.
However, all directors are free to and
regularly make further inquiries where
they feel it necessary . The directors are
able to take independent professional
advice as required.
Audit committee
The Audit Committee comprises John
Gordon (Chairman) and Pierce Casey,
both of whom are non-executive
directors, and meets formally not less
than twice a year. The Committee
determines the terms of engagement of
the Company’ s auditors, in consultation
with the auditors, reviews the scope of
the Company’ s audit and reviews
reports from management and the
Company’ s auditors relating to interim
and annual financial statements and
accounting controls throughout the
Company and its subsidiaries. The
Committee has unlimited access to
the Company’ s auditors.
Remuneration committee
The Remuneration Committee
comprises John Gordon (Chairman)
and Pierce Casey and meets formally
not less than twice a year. The
Remuneration Committee has written
terms of reference and determines on
behalf of the Board the remuneration
and benefits of the executive directors
of the Company and ratifies proposals
made by executive directors in respect
of the remuneration and benefits of
selected senior managers in the Group.
In formulating its remuneration policy,
the Remuneration Committee gives full
consideration to matters set out in
Schedule A to the Combined Code.
The non-executive directors do not
have service contracts, but letters of
appointment with the Company . The
Board as a whole determines the level
of fees of non-executive directors, after
taking into account fees payable by
comparable companies and/or outside
advice. Details of fees paid to non-
executive directors are set out in note 4
to the financial statements. The Board
considers that John Gordon is an
independent director as that expression
is used in the Combined Code.
Internal financial control
The directors are responsible for the
Group’s system of internal financial
control. Although no system of
internal financial control can provide
absolute assurance against material
misstatement or loss, the Group’s
system is designed to provide the
directors with reasonable assurance
that problems are identified on a
timely basis and dealt with
appropriately. Key procedures that
have been established and are
designed to provide effective internal
financial control are described below:
Financial reporting
The budget is approved each year by
the Board in the light of the Group’ s
strategic plan. Key risk areas are
identified. Performance is monitored
and relevant action taken throughout
the year through the regular reporting
to the Board of any variances from the
budget and updated forecasts for the
year together with information on the
key risk areas.
Control of operations
Control of operations is primarily
affected by day to day supervision. The
integrity and competence of personnel
is ensured through high recruitment
standards and appropriate training and
professional development. High quality
personnel are seen as an essential part
of the budgetary process and
authorisation levels. For expenditure
beyond specified levels, detailed
written proposals have to be submitted
to the Board. The Group has a team to
deal with acquisition opportunities and
carry out, in conjunction with the
Group’ s external advisers, all necessary
due diligence work.
Going concern
After making enquiries, the directors
have a reasonable expectation that
the Group has adequate resources to
continue in operational existence for
the foreseeable future. For this reason,
they continue to adopt the going
concern basis in preparing the
financial statements.
Relations with shareholders
Communication with shareholders is
given high priority . The Chairman’ s
Statement, Chief Executive’ s Review
and Financial Review on pages 2 to 11
include a detailed review of the
business and future prospects. There is
regular dialogue with shareholders
including presentations after the
Group’ s preliminary announcement of
the year-end and half-year results.
Copies of the Annual Reports, Interim
Reports and Analysts’ Presentations are
available on the Group’ s website
www.imprintplc.com.
The Board welcomes shareholder
participation at the Annual General
Meeting and aims to ensure that the
Chairman of the Audit and
Remuneration Committees is available
to answer questions. Details of
resolutions to be proposed at the
Annual General Meeting on 19 April
2007 can be found in the Notice of the
Meeting on page 49.
Approved by the Board of Directors and
signed on behalf of the Board
Colin Webster
Chief Financial Officer
23 February 2007
Corporate
governance
repo rt 16 | Group report and accounts 2006
Imprint Plc | Directors’ report
Final dividend of 2.6p
per share (2005 – 2.0p
maiden dividend) The directors present their report
together with the audited financial
statements for the year ended 31
December 2006.
Results and dividends
The results of the Group for the year
are set out on page 21 and show a
profit for the year after taxation of
£6.7 million (2005 – £2.6 million). The
directors propose a dividend of 2.6p
per share in respect of 2006 (2005 –
2.0p). This dividend will be paid on 18
May 2007 to those shareholders on
the register at 20 April 2007.
Principal activities, review of
business and future developments
The Group’s principal activity is the
provision of a diverse range of
international recruitment services
across various functional specialisms
to blue-chip clients, from contingency
to search, support to board level,
across multiple industries and
locations. The Group comprises six
trading brands: Accreate, ECHM, iQ
selection, Imprint Search & Selection,
Morgan McKinley and WoodHamill.
Acquisition of the Ingram Consultancy
On 19 July 2006, Imprint acquired
the Ingram Consultancy, one of the
United Arab Emirates’ leading
recruitment businesses, for initial
consideration of £1.2 million and a
further potential £3.8 million,
contingent upon the profits of the
business in the year ended 31
December 2006 and the years ending
31 December 2007 and 2008. This
acquisition has provided Imprint with
a strategic entry point into the high
growth Dubai and Gulf Cooperative
Community markets and has further
broadened the scope of the services
we offer to our commercial and
financial services clients.
This acquisition was funded by cash
of £900,000 and the issue of 0.12
million new ordinary shares to the
consultancy’s vendor. The contingent
consideration is payable in a
combination of cash and new
ordinary shares.
The Ingram Consultancy trades
as two businesses, iQ selection,
which provides contingent
recruitment services in the region,
and an executive search business
which has recently been rebranded
as WoodHamill Ingram to reflect
the international talent search
capabilities which the Group can now
provide in this geographical region.
The directors are pleased with the
results for the year. A review of the
Group’s performance during the
year is contained in the Chairman’s
Statement, Chief Executive’s Review
and Financial Review on pages 2
to 11. The Group’s financial risk
management objectives and policies
are discussed in the Financial Review
on pages 10 and 11, and in note 22 to
the financial statements.
The year to 31 December 2007 has
started well and the Board remains
optimistic about the prospects for
the full year.
Charitable and political
contributions
Charitable donations totalling
£800 were paid during the year
(2005 – £3,500). There were no
political donations.
Policy on the payment of creditors
The Group’s payment terms and
conditions with individual suppliers
vary according to the commercial
relationship and the terms of the
agreements reached. It is the policy
of the Group that payments to
suppliers are made in accordance
with the terms agreed. The average
number of days’ purchases included
within trade creditors at the year-end
was 41 (2005 – 44).
Employment policy
The Group continues to give full
and fair consideration to applications
for employment made by disabled
persons, having regard to their
respective aptitudes and abilities.
The Group has a policy of employee
involvement by making information
available to employees on matters of
concern to them. Many employees are
stakeholders in the business through
participation in share option schemes.
Principal risks and uncertainties
Like all staffing businesses, the Group
remains sensitive to the welfare of
the broader economy. Any sustained
downturn will inevitably affect
business performance. Visibility on
future revenues is limited. In addition,
competition for business is always
intense and margins and pricing
could come under pressure if there
is a slowing in demand.
The risks relating to financial
instruments are considered in detail
in note 22.
Directors
The directors of the Company during
the year and their beneficial interests
in the ordinary share capital of the
Company were as shown in Table A.
Continued overleaf
Group report and accounts 2006 | 17
Imprint Plc | Directors’ report
Directors’report
Table A Acquired/ Ordinary shares
31 December (disposed of) 31 December
2005 during the year 2006
Brian Hamill 2,125,000 4,000 2,129,000
Pierce Casey 1,225,000 – 1,225,000
John Gordon 37,500 – 37,500
John Hunter – 4,000 4,000
Robert Thesiger 375,201 – 375,201
Colin Webster – 4,000 4,000 18 | Group report and accounts 2006
Imprint Plc | Directors’ report
T able B
Options and Exercise
Director Equity Interests price Exercise period
Brian Hamill 100,000 37.5p 31 December 2003 – 22 March 2013
100,000 37.5p 31 December 2004 – 22 March 2013
100,000 37.5p 31 December 2005 – 22 March 2013
John Hunter 40,000 45p 31 December 2001 – 11 October 2011
40,000 45p 31 December 2002 – 11 October 2011
40,000 45p 31 December 2003 – 11 October 2011
40,000 45p 31 December 2004 – 11 October 2011
40,000 45p 31 December 2005 – 11 October 2011
150,000 37.5p 31 December 2003 – 22 March 2013
150,000 37.5p 31 December 2004 – 22 March 2013
150,000 37.5p 31 December 2005 – 22 March 2013
Colin Webster 30,000 144.5p 31 December 2004 – 7 December 2014
30,000 144.5p 31 December 2005 – 7 December 2014
30,000 144.5p 31 December 2006 – 7 December 2014
30,000 144.5p 31 December 2007 – 7 December 2014
30,000 144.5p 31 December 2008 – 7 December 2014
250,000 284.5p Refer to note below
Robert Thesiger 6,969 287p 31 December 2005 – 7 December 2015
6,969 287p 31 December 2006 – 7 December 2015
6,969 287p 31 December 2007 – 7 December 2015
6,968 287p 31 December 2008 – 7 December 2015
6,968 287p 31 December 2009 – 7 December 2015
215,157 287p Refer to note below
Note: The nature of the arrangements regarding the equity interests awarded to Robert Thesiger and Colin Webster during
the year, including details on how they can be exercised, is set out in more detail in note 17 to the financial statements.
T able C Holdings as at 14 February 2007
%
AXA Framlington Investment Management 11.8
Blackrock Investment Management 10.7
Scottish Widows Investment Partnership 7.8
Brian Hamill 5.7
Rensburg Sheppards Investment Management 5.6
Resolution Asset Management 4.6
F&C Asset Management 3.5
Rathbone Investment Management 3.3
Pierce Casey 3.3
Artemis Investment Management 3.2
At 31 December 2006 the directors as
shown in Table B had options to
purchase ordinary shares in Imprint Plc
under the Company’ s share option and
incentivisation schemes.
The mid-market price of the ordinary
shares of the Company as at 29
December 2006 was 257.5 pence. The
lowest and highest prices during the
year were 241 pence and 328 pence.
No directors were granted options nor
were any share options exercised during
the year and no director’ s options were
forfeited during the year. There have
been no changes in directors’ interests
since 31 December 2006.
Substantial shareholdings
Except for the shareholders as shown
in Table C, no other person has reported
an interest of 3% or more in the
Company’ s ordinary shares.
Events since the balance sheet date
There have been no reportable events
since 31 December 2006.
Directors’ statement as to disclosure
of information to auditors
The directors who were members of
the board at the time of approving the
directors’ report are listed on page 12.
Having made enquiries of fellow
directors and of the company’s
auditors, each of these directors
confirms that:
• To the best of each director’s
knowledge and belief, there is no
information relevant to the
preparation of their report of
which the company’s auditors are
unaware; and
• Each director has taken all the
steps a director might reasonably
be expected to have taken to be
aware of relevant audit
information and to establish that
the company’s auditors are aware
of that information.
Auditors
A resolution to re-appoint Ernst
& Young LLP as auditors will be
put to members at the Annual
General Meeting.
On behalf of the Board
Brian Hamill
Chief Executive Officer
23 February 2007 Group report and accounts 2006 | 19
Imprint Plc | Name of section Imprint Plc | Statement of directors’ responsibilities
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 the
financial statements in accordance with
United Kingdom Generally Accepted
Accounting Practice (United Kingdom
Accounting Standards and applicable
law). The financial statements are
required by law to give a true and fair
view of the state of affairs of the
company and of the group 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 judgments and estimates that
are reasonable and prudent;
• state whether applicable UK
Accounting Standards have been
followed, subject to any material
departures disclosed and explained
in the financial statements; and
• prepare the financial statements on
the going concern basis unless it is
inappropriate to presume that the
company will continue in business.
The directors are responsible for
keeping proper accounting records
that disclose with reasonable accuracy
at any time the financial position of
the group and to enable them to
ensure that the financial statements
comply with the Companies Act 1985.
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.
The directors’ are responsible for the
maintenance and integrity of the
corporate and financial information
included on the group’s website.
Legislation in the United Kingdom
governing the preparation and
dissemination of financial statements
may differ from legislation in
other jurisdictions.
Pre-tax profit up
109% to £9.1 million
(2005 – £4.4 million) 20 | Group report and accounts 2006
Imprint Plc | Independent auditors’ report
We have audited the group and parent
company financial statements (the
“financial statements”) of Imprint Plc
for the year ended 31 December 2006
which comprise Consolidated Profit
and Loss Account, the Consolidated
and Company Balance Sheets, the
Consolidated Statement of Cash Flows,
the Consolidated Statement of T otal
Recognised Gains and Losses, the
Consolidated Reconciliation of
Movements in Shareholders’ Funds
and the related notes 1 to 23. These
financial statements have been
prepared under the accounting policies
set out therein.
This report is made solely to the
company’ s members, as a body, in
accordance with Section 235 of the
Companies Act 1985. Our audit work
has been undertaken so that we might
state to the company’ s members those
matters we are required to state to
them in an auditors’ report and for no
other purpose. T o the fullest extent
permitted by law, we do not accept or
assume responsibility to anyone other
than the company and the company’ s
members as a body, for our audit work,
for this report, or for the opinions we
have formed.
Respective responsibilities of
directors and auditors
The directors’ responsibilities for
preparing the Annual Report and the
financial statements in accordance
with applicable United Kingdom law
and Accounting Standards (United
Kingdom Generally Accepted
Accounting Practice) are set out in the
Statement of Directors’ Responsibilities.
Our responsibility is to audit the
financial statements in accordance
with relevant legal and regulatory
requirements and International
Standards on Auditing (UK and Ireland).
We report to you our opinion as to
whether the financial statements give
a true and fair view and are properly
prepared in accordance with the
Companies Act 1985. We also report
to you whether in our opinion the
information given in the directors’
report is consistent with the
financial statements.
In addition we report to you if, in our
opinion, the company has not kept
proper accounting records, if we have
not received all the information and
explanations we require for our audit,
or if information specified by law
regarding directors’ remuneration and
other transactions is not disclosed.
We read other information
contained in the Annual Report,
and consider whether it is consistent
with the audited financial statements.
This other information comprises
only Highlights, Chairman’ s Statement,
the Chief Executive’ s Review, the
Company Overviews, the Financial
Review, the Directors’ Profiles, the
Remuneration Committee’ s Report,
the Corporate Governance Report,
the Directors’ Report and Notice of
Annual General Meeting. We consider
the implications for our report if
we become aware of any apparent
misstatements or material
inconsistencies with the financial
statements. Our responsibilities do not
extend to any other information.
Basis of audit opinion
We conducted our audit in accordance
with International Standards on
Auditing (UK and Ireland) issued by the
Auditing Practices Board. An audit
includes examination, on a test basis,
of evidence relevant to the amounts
and disclosures in the financial
statements. It also includes an
assessment of the significant estimates
and judgments made by the directors
in the preparation of the financial
statements, and of whether the
accounting policies are appropriate to
the group’ s and company’ s
circumstances, consistently applied
and adequately disclosed.
We planned and performed our audit
so as to obtain all the information and
explanations which we considered
necessary in order to provide us with
sufficient evidence to give reasonable
assurance that the financial statements
are free from material misstatement,
whether caused by fraud or other
irregularity or error. In forming our
opinion we also evaluated the overall
adequacy of the presentation of
information in the financial statements.
Opinion
In our opinion:
• the financial statements give a true
and fair view, in accordance with
United Kingdom Generally Accepted
Accounting Practice, of the state of
the group’ s and the parent
company’ s affairs as at 31 December
2006 and of the group’ s profit for the
year then ended;
• the financial statements have been
properly prepared in accordance
with the Companies Act 1985; and
• the information given in the
directors’ report is consistent with
the financial statements.
Ernst & Young LLP
Registered auditor
London
23 February 2007
Independent
auditors’ report
to the shareholders of Imprint Plc
Notes:
1. The maintenance and integrity of the Imprint Plc website is the responsibility of the directors; the work carried
out by the auditors does not involve consideration of these matters and, accordingly, the auditors accept no
responsibility for any changes that may have occurred to the financial statements since they were initially presented
on the website.
2. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ
from legislation in other jurisdictions. Group report and accounts 2006 | 21
Consolidated profit
and loss account
for the year ended 31 December 2006
2006 2005
Note £000 £000
(restated)
T urnover
– ongoing 79,432 54,816
– acquisitions 680 –
2 80,112 54,816
Cost of sales 3 (35,220) (22,976)
Gross profit 2 44,892 31,840
Administrative expenses – other than amortisation of goodwill,
exceptional items and share-based payment charge (33,291) (24,770)
Operating profit before amortisation of goodwill,
exceptional items and share-based payment charge 11,601 7,070
Administrative expenses – amortisation of goodwill 10 (1,823) (1,277)
Administrative expenses – exceptional items 3 (370) (1,345)
Administrative expenses – share-based payment charge 17 (280) (175)
T otal administrative expenses 3 (35,764) (27,567)
Operating profit
– ongoing 9,030 4,273
– acquisitions 98 –
3 9,128 4,273
Net interest (payable)/receivable (40) 85
Profit on ordinary activities before tax 2 9,088 4,358
T ax on profit on ordinary activities 6 (2,406) (1,790)
Profit for the financial year 6,682 2,568
Earnings per share
Basic (pence) 8 18.2 7.9
Diluted (pence) 8 17.0 7.2
Basic – adjusted for amortisation and exceptional items (pence) 8 23.8 14.8
Diluted – adjusted for amortisation and exceptional items (pence) 8 22.3 13.5
The above results all relate to continuing operations, including earnings per share. 22 | Group report and accounts 2006
2006 2005
£000 £000
(restated)
Profit for the financial year 6,682 2,568
Foreign currency translation differences (155) 16
T otal recognised gains and losses relating to the year 6,527 2,584
Impact of prior year adjustment on shareholders’ equity
(as explained in note 1) (1,721)
Consolidated reconciliation of
movements in shareholders’ equity
for the year ended 31 December 2006
2006 2005
£000 £000
(restated)
Profit for the financial year 6,682 2,568
Dividends paid (1,219) –
Foreign currency translation differences (155) 16
Credit in respect of share-based payment charge 280 175
New shares issued 999 35,193
Share issue costs – (1,179)
6,587 36,773
Opening shareholders’ equity (originally £42,640,000 before
deducting prior year adjustment of £1,721,000) 40,919 4,146
Closing shareholders’ equity 47,506 40,919
Consolidated statement of total
recognised gains and losses
for the year ended 31 December 2006 Group report and accounts 2006 | 23
Consolidated balance sheet
at 31 December 2006
2006 2005
Note £000 £000
(restated)
Fixed assets
Intangible assets – goodwill 10 33,724 33,987
T angible assets 11 1,125 929
34,849 34,916
Current assets
Debtors 13 20,110 15,469
Loan note deposits 453 1,307
Cash and short-term deposits 4,307 3,169
24,870 19,945
Creditors: amounts falling due within one year 14 (9,688) (10,500)
Net current assets 15,182 9,445
T otal assets less current liabilities 50,031 44,361
Provisions for liabilities and charges 15 (2,525) (3,442)
47,506 40,919
Capital and reserves
Called up share capital 17 373 362
Share premium account 18 40,291 39,303
Profit and loss account 18 6,842 1,254
Shareholders’ equity 47,506 40,919
Brian Hamill Colin Webster
Director Director
23 February 2007 24 | Group report and accounts 2006
2006 2005
Note £000 £000
(restated)
Fixed assets
Investments 12 43,150 41,879
Current assets
Debtors 13 3,431 6,883
Loan note deposits 453 1,307
Cash – 154
3,884 8,344
Creditors: amounts falling due within one year 14 (3,806) (7,446)
Net current assets 78 898
T otal assets less current liabilities 43,228 42,777
Provisions for liabilities and charges 15 (2,155) (3,442)
41,073 39,335
Capital and reserves
Called up share capital 17 373 362
Share premium account 18 40,291 39,303
Profit and loss account 18 409 (330)
Shareholders’ equity 41,073 39,335
Brian Hamill Colin Webster
Director Director
23 February 2007
Balance sheet
at 31 December 2006 Group report and accounts 2006 | 25
Consolidated statement
of cash flows
for the year ended 31 December 2006
2006 2005
Note £000 £000
Net cash inflow from operating activities
Operating activities other than exceptional items 8,017 5,282
Cash outflow from exceptional items (345) (1,000)
3(b) 7,672 4,282
Returns on investments and servicing of finance
Interest (paid)/received (41) 85
T axation
Corporation tax (2,309) –
Capital expenditure
Payments to acquire tangible fixed assets (875) (554)
Proceeds from sale of tangible fixed assets – 31
Acquisitions
Purchase of subsidiary undertakings – cash (2,209) (26,058)
Purchase of subsidiary undertakings – loan note deposits – (3,686)
Net cash/(debt) acquired with subsidiary undertakings 1 (315)
Equity dividends paid (1,219) –
Net cash inflow/(outflow) before management
of liquid resources and financing 1,020 (26,215)
Management of liquid resources and financing
Issue of new ordinary shares 77 28,100
Share issue costs – (1,179)
Decrease in short-term deposits – 1,873
Increase in cash 16 1,097 2,579
Reconciliation of net cash flow
to movement in net funds
2006 2005
Note £000 £000
Increase in cash 1,097 2,579
Decrease in short-term deposits – (1,873)
Change in net funds resulting from cash flows 16 1,097 706
Foreign currency translation differences 41 –
Movement in net funds in the year 1,138 706
Opening net funds 16 3,169 2,463
Closing net funds 16 4,307 3,169 26 | Group report and accounts 2006
1. Accounting policies
Accounting convention
The financial statements are prepared under the historical cost convention and in accordance with applicable
United Kingdom accounting standards.
The accounting policies are the same as those set out in the financial statements of the Group for the year ended
31 December 2005, with the exception of share-based payments to employees which are now accounted for under
FRS 20 (IFRS 2), as described further in note 17. Applying Black-Scholes valuation models to the Group’ s share
option plans provides a fair value charge which in accordance with FRS 20 has been added to administrative
expenses in each accounting period as highlighted on the profit and loss account. There is no effect on equity
shareholders’ funds at any balance sheet date.
The directors have reconsidered the presentation of the shares to be issued in respect of deferred consideration in
light of the presentation requirements of FRS 25. These shares were previously included as part of Shareholders’
equity but now form part of provision for liabilities and charges. The effect on the financial statements for the year
ended 31 December 2005, in both the consolidated and Company balance sheets, is to decrease Shareholders’
equity by £1,721,000 and increase provisions for liabilities and charges by the same amount. There has been no
effect on the profit for the year ended 31 December 2005 as a result of this adjustment.
Basis of consolidation
The Group financial statements consolidate the financial statements of Imprint Plc and its subsidiary
undertakings drawn up to 31 December each year. No profit and loss account is presented for the Company as
permitted by section 230 of the Companies Act 1985.
Goodwill
Positive goodwill arising on acquisitions is capitalised, classified as an asset on the balance sheet and amortised
on a straight line basis over its useful economic life up to a presumed maximum of 20 years. It is reviewed for
impairment at the end of the first full financial year following the acquisition and in other periods if events or
changes in circumstances indicate that the carrying value may not be recoverable.
Fixed asset investments
Investments in subsidiaries are stated at cost. The carrying value is reviewed for impairment periodically for
events or changes in circumstances that indicate that the carrying value may not be recoverable.
Depreciation
Depreciation is provided on all tangible fixed assets at rates calculated to write off the cost, less estimated residual
value, of each asset evenly over its expected useful life, as follows:
Furniture, fixtures and fittings, and office equipment – 25% per annum
Computer equipment – 25% – 50% per annum
The carrying values of tangible fixed assets are reviewed for impairment periodically for events or changes in
circumstances that indicate that the carrying value may not be recoverable.
Turnover
Turnover is stated net of value added tax and represents amounts derived from the provision of services to third
parties in respect of the Group’ s continuing activity as stated in the directors’ report, consisting of:
• turnover from permanent placements, which is recognised at the date an offer is accepted by a candidate and
a start date is determined, and
• turnover from temporary placements, which represents amounts billed for the services of temporary staff.
Turnover not invoiced at the balance sheet date is included within accrued income.
Notes to the financial statements
at 31 December 2006 Group report and accounts 2006 | 27
Notes to the financial statements
at 31 December 2006
1. Accounting policies (continued)
Deferred taxation
Deferred taxation is recognised in respect of all timing differences that have originated, but not reversed at the
balance sheet date, in respect of transactions or events that have occurred at that date that will result in an
obligation to pay more, or right to pay less, tax, with the following exceptions:
• provision is made for deferred tax that would arise on remittance of the retained earnings of subsidiaries only
to the extent that, at the balance sheet date, dividends have been accrued as receivable; and
• deferred tax assets are recognised only to the extent that the directors consider that it is more likely than not
that there will be suitable taxable profits from which the future reversal of the underlying timing differences
can be deducted.
Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the years in which
timing differences reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date.
Foreign currencies
Company
Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets
and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the balance
sheet date. All differences are taken to the profit and loss account with the exception of differences on foreign
currency borrowings, to the extent that they are used to finance or provide a hedge against foreign equity
investments, which are taken directly to reserves together with the exchange difference on the carrying amount of
the related investments. T ax charges and credits attributable to exchange differences on those borrowings are also
dealt with in reserves.
Group
The assets and liabilities of foreign operations are translated into sterling at the rate of exchange ruling at the
balance sheet date. Income and expenses are translated at weighted average exchange rates for the year. The
resulting exchange differences are taken directly to reserves.
All other translation differences are taken to the profit and loss account with the exception of differences on
foreign currency borrowings to the extent that they are used to finance or provide a hedge against group equity
investments in foreign enterprises, which are taken directly to reserves together with the exchange difference on
the net investment in these enterprises. T ax charges and credits to exchange differences on those borrowings are
also dealt with in reserves.
Leasing
Rentals paid under operating leases are charged to income on a straight line basis over the lease term.
Pensions
The Group has stakeholder pension schemes available for employees and also makes defined contributions
directly to employees’ personal pension plans. Contributions are charged to the profit and loss account as they
become payable.
Classification of shares as debt or equity
An equity instrument is a contract that evidences a residual interest in the assets of any entity after deducting all
its liabilities. Accordingly, a financial instrument is treated as equity if:
(i) there is no contractual obligation to deliver cash or other financial assets or to exchange financial assets or
liabilities on terms that may be unfavourable: and
(ii)the instrument is a non-derivative that contains no contractual obligations to deliver a variable number of
shares or is a derivative that will be settled only by the Group exchanging a fixed amount of cash or other assets for
a fixed number of the Group’ s own equity instruments. 28 | Group report and accounts 2006
1. Accounting policies (continued)
Share-based payments
The cost of equity-settled transactions with employees, for awards granted after 7 November 2002, is measured by
reference to the fair value at the date on which they are granted. The fair value is determined by an external valuer
using an appropriate pricing model, further details of which are given in note 17.
The cost of equity-settled transactions is recognised, together with a corresponding increase in equity, over the
period in which the performance and/or service conditions are fulfilled, ending on the date on which the relevant
employees become fully entitled to the award (‘the vesting date'). The cumulative expense recognised for equity-
settled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has
expired and the Group's best estimate of the number of equity instruments that will ultimately vest. The income
statement charge or credit for a period represents the movement in cumulative expense recognised as at the
beginning and end of that period.
The dilutive effect of outstanding options is reflected as additional share dilution in the computation of earnings
per share.
2. Segmental analysis
2006 2005
£000 £000
(a) T urnover by geographic region (by location of Group operations)
United Kingdom and Europe 74,595 52,157
Asia Pacific and Middle East 5,517 2,659
80,112 54,816
T urnover from clients by location of client operations is not materially different to turnover by location of Group operations.
2006 2005
£000 £000
(b) Gross profit (net fee income) by geographic region
United Kingdom and Europe 39,468 29,319
Asia Pacific and Middle East 5,424 2,521
44,892 31,840
2006 2005
£000 £000
(c) T urnover and gross profit generated from permanent
and temporary placements
T urnover
– permanent 36,601 26,694
– temporary 43,511 28,122
80,112 54,816
Gross profit (net fee income)
– permanent 36,067 26,258
– temporary 8,825 5,582
44,892 31,840
Notes to the financial statements
at 31 December 2006 Group report and accounts 2006 | 29
Notes to the financial statements
at 31 December 2006
2. Segmental analysis (continued)
2006 2005
£000 £000
(d) Operating profit before goodwill amortisation, exceptional
items and share-based payment charge by geographic region
United Kingdom and Europe 10,536 6,761
Asia Pacific and Middle East 1,065 309
11,601 7,070
2006 2005
£000 £000
(restated)
(e) Profit before taxation by geographic region
United Kingdom and Europe 9,886 5,241
Asia Pacific and Middle East 1,065 309
Operating profit before amortisation of goodwill 10,951 5,550
Amortisation of goodwill:
United Kingdom and Europe (1,797) (1,277)
Asia Pacific and Middle East (26) –
(1,823) (1,277)
Operating profit 9,128 4,273
Net interest (payable)/receivable (40) 85
Profit on ordinary activities before taxation 9,088 4,358
United Kingdom and Europe 8,049 4,052
Asia Pacific and Middle East 1,039 306
9,088 4,358
2006 2005
£000 £000
(f) Net assets/(liabilities) by geographic region
United Kingdom and Europe 46,829 41,150
Asia Pacific and Middle East 677 (231)
47,506 40,919 30 | Group report and accounts 2006
3. Operating profit
(a) This is stated after charging:
2006 2005
£000 £000
Auditors’ remuneration:
Audit of the financial statements
*
85 54
Other fees to auditors – local statutory audits for subsidiaries 17 26
– taxation services 35 25
– other services 11 –
Depreciation of tangible fixed assets 461 378
Amortisation of goodwill 1,823 1,277
Operating lease rentals – land and buildings 1,592 1,212
Exchange differences 30 41
*
£10,000 relates to the Company (2005 – £9,000).
Included in other fees to auditors is £48,000 (2005 – £35,000) relating to the company and its UK subsidiaries.
In the year ending 31 December 2005 the auditors were also paid £418,000 for services relating to the Company’ s
acquisitions during the year. These costs were capitalised as part of acquisition costs.
(b) Reconciliation of operating profit to net cash inflow from operating activities:
2006 2005
£000 £000
(restated)
Operating profit 9,128 4,273
Share-based payment charge 280 175
Depreciation 461 378
Amortisation of goodwill 1,823 1,277
Loss on disposal of tangible fixed assets – 128
Increase in operating debtors (4,853) (3,023)
Increase in operating creditors 1,178 2,074
Exceptional items (345) (1,000)
Net cash inflow from operating activities 7,672 4,282
(c) Analysis of operating profit from continuing operations:
2006
Ongoing Acquisitions T otal
£000 £000 £000
T urnover 79,432 680 80,112
Cost of sales (35,220) – (35,220)
Gross profit 44,212 680 44,892
Administrative expenses (35,182) (582) (35,764)
Operating profit 9,030 98 9,128
Notes to the financial statements
at 31 December 2006 Group report and accounts 2006 | 31
Notes to the financial statements
at 31 December 2006
3. Operating profit (continued)
(d) Analysis of exceptional items:
2006 2005
£000 £000
Restructuring costs relating to the acquisition of ECHM – 617
Restructuring costs relating to the acquisition of Morgan McKinley – 387
Other reorganising, restructuring and integration costs – 341
Onerous lease provision charge 370 –
370 1,345
Net cash inflow from operating activities in 2006 includes cash outflows of £345,000 (2005 – £1,000,000) in respect
of the above operating exceptional items.
The onerous lease provision charge above relates to ECHM’ s current London premises which the Group now plans
to sub-let. A decision was taken late in 2006 to collocate ECHM, Morgan McKinley and the Group’ s common back
office functions in the same London office.
4. Directors’ remuneration
The emoluments of the individual directors were as follows:
2006
Salary T otal Pension
and fees Bonus emoluments contributions
££ ££
Brian Hamill 87,993 – 87,993 209,875
John Hunter 200,000 – 200,000 20,000
Robert Thesiger 200,000 – 200,000 20,000
Colin Webster 151,250 – 151,250 31,130
Pierce Casey* 45,000 – 45,000 –
John Gordon* 35,000 – 35,000 –
719,243 – 719,243 281,005
2005
Salary T otal Pension
and fees Bonus emoluments contributions
££ ££
Brian Hamill 163,333 131,873 295,206 16,104
John Hunter 134,085 110,417 244,502 6,625
Robert Thesiger (appointed 26 April 2005) 95,278 40,833 136,111 4,764
Colin Webster 113,333 83,584 196,917 6,633
Pierce Casey* 37,500 – 37,500 –
John Gordon* 25,046 – 25,046 –
568,575 366,707 935,282 34,126
*Non-executive directors
Bonuses include performance-related amounts earned in respect of the year under which they are shown but not
paid until the following year. In 2005, they also include bonuses relating to the acquisitions of ECHM and Morgan
McKinley which were paid during the year.
The executive directors are accruing retirement benefits under personal money purchase schemes. 32 | Group report and accounts 2006
5. Employee costs
Employee costs (including executive directors) were as follows:
2006 2005
£000 £000
Wages and salaries 21,787 15,237
Social security costs 2,245 1,687
Other pension costs 364 250
Share-based payment charge 280 –
24,676 17,174
The average monthly number of employees during the year was as follows:
2006 2005
No. No.
Executive directors 44
Fee earners 360 240
Administration 87 67
451 311
6. T axation
(a) Analysis of tax charge for the year:
The charge based on the profit for the year comprises:
2006 2005
£000 £000
Corporation tax
UK corporation tax on profit for the year 2,107 1,224
2,107 1,224
Foreign tax
Current tax 353 76
T otal current tax 2,460 1,300
Deferred tax
Origination and reversal of timing differences (54) 490
2,406 1,790
(b) Factors affecting the current tax charge for the year:
The tax assessed on the profit on ordinary activities for the year differs from the standard rate of corporation tax in the UK
of 30% (2005 – 30%). The differences are reconciled below:
2006 2005
£000 £000
(restated)
Group profit on ordinary activities before tax 9,088 4,358
Group profit on ordinary activities at standard rate of UK corporation tax 2,726 1,307
Amortisation of goodwill 547 371
Disallowable expenses and non taxable income 23 354
Relief available on exercise of share options (538) (73)
Depreciation in arrears of capital allowances (23) (48)
Other short-term timing differences (32) 32
Losses utilised (62) (616)
Differences in foreign tax rates (181) (27)
T otal current tax 2,460 1,300
Notes to the financial statements
at 31 December 2006 Group report and accounts 2006 | 33
Notes to the financial statements
at 31 December 2006
6. T axation (continued)
(c) Deferred tax
The Group deferred tax asset arising during the year is analysed below:
£000
At 1 January 2006 156
Arising during the year 54
At 31 December 2006 210
2006 2005
Unrecognised Recognised Unrecognised Recognised
£000 £000 £000 £000
Losses carried forward 3– 48 –
Decelerated capital allowances – 113 – 94
Other timing differences – 97 – 62
3 210 48 156
(d) Corporation tax creditor
Group Company
2006 2005 2006 2005
£000 £000 £000 £000
Included in creditors: amounts
falling due within one year (1,401) (1,553) – (8)
7. Dividends
2006 2005
£000 £000
Amounts recognised as distributions to equity holders in the year:
Final dividend for the year ended 31 December 2005 of 2.0p per share 734 –
Interim dividend for the year ended 31 December 2006 of 1.3p per share 485 –
1,219 –
Amounts proposed as distributions to equity holders in the year:
Proposed final dividend for the year ended 31 December 2006
of 2.6p per share (2005 - 2.0p per share) 970 734
The proposed final dividend had not been approved by shareholders at 31 December 2006 and therefore has not been
included as a liability . This dividend will be paid on 18 May 2007 to those shareholders on the register at 20 April 2007. 34 | Group report and accounts 2006
8. Earnings per share
2006 2005
£000 £000
Profit for basic earnings per share 6,681 2,568
Exceptional items 370 1,345
T ax effect of exceptional items (111) (403)
Amortisation of goodwill 1,824 1,277
Profit before exceptional items and amortisation of
goodwill for adjusted earnings per share 8,764 4,787
No. No.
Weighted average number of shares
used for basic and adjusted earnings per share 36,792,478 32,381,713
Dilutive effect of share plans 2,467,000 3,126,266
Diluted weighted average number of shares
used for diluted earnings per share 39,259,478 35,507,979
pence pence
Basic earnings per share 18.2 7.9
Diluted earnings per share 17.0 7.2
Adjusted basic earnings per share 23.8 14.8
Adjusted diluted earnings per share 22.3 13.5
Adjusted earnings per share have been disclosed for each period before the post-tax effect of exceptional items and
amortisation of goodwill.
The difference between the number of shares in the basic and weighted average number of shares in the diluted earnings
per share calculations represents the dilutive effect of the potential conversion of all ordinary shares under option and the
contingent shares arising on the Company’ s acquisition of Accreate, calculated in accordance with FRS 22 “Earnings per
share” . The total number of ordinary shares under option (which could have a dilutive effect in the future) is analysed in
note 17.
9. Profit attributable to members of parent company
The profit dealt with in the financial statements of the parent company was £1,678,000 (2005 – £65,000).
Notes to the financial statements
at 31 December 2006 Group report and accounts 2006 | 35
Notes to the financial statements
at 31 December 2006
10. Intangible fixed assets
Group Goodwill
£000
Cost:
At 1 January 2006 35,264
Arising on acquisitions (note 23) 1,136
Fair value adjustments to prior period acquisitions (note 23) 424
At 31 December 2006 36,824
Amortisation:
At 1 January 2006 1,277
Charge for the year 1,823
At 31 December 2006 3,100
Net book value:
At 31 December 2006 33,724
At 31 December 2005 33,987
Goodwill arising on acquisitions is amortised evenly over the directors’ estimate of their useful lives of 20 years.
11. T angible fixed assets
Group Furniture,
fixtures Office Computer
and fittings equipment equipment T otal
£000 £000 £000 £000
Cost:
At 1 January 2006 599 22 910 1,531
Foreign exchange difference (6) (1) (6) (13)
Acquisitions 54 – 47 101
Additions 106 56 398 560
Disposals –– ––
At 31 December 2006 753 77 1,349 2,179
Depreciation:
At 1 January 2006 379 4 219 602
Foreign exchange difference (4) (1) (4) (9)
Provided during the year 111 15 335 461
Disposals –– ––
At 31 December 2006 486 18 550 1,054
Net book value:
At 31 December 2006 267 59 799 1,125
At 31 December 2005 220 18 691 929
There were no tangible fixed assets held by the Company at 31 December 2006 and 31 December 2005. 36 | Group report and accounts 2006
12. Fixed asset investments
Company Investment in
subsidiary
undertakings
£000
Cost:
At 1 January 2006 41,879
Additions 1,271
At 31 December 2006 43,150
Subsidiary undertakings
The details of the subsidiary companies as at 31 December 2006 were:
Country of incorporation
Name of company and operation Principal activity
Imprint Consulting Limited England Recruitment consultancy
Imprint Search and Selection Limited Hong Kong Recruitment consultancy
Imprint Search and Selection Japan KK Japan Recruitment consultancy
Imprint Search and Selection (Pte) Limited Singapore Recruitment consultancy
Morgan McKinley Group Limited England Recruitment consultancy
Accreate Limited Ireland Recruitment consultancy
Ingram Consultancy Limited Jersey Holding company
Ingram Consultancy (Branch) Limited Dubai Recruitment consultancy
WoodHamill Limited England Dormant
Executive Connections Limited England Dormant
Hitchenor Maher Limited England Dormant
ECHM Group Limited England Dormant
Citipeople (International) Limited* England Dormant
Citipeople (UK) Limited* England Dormant
Citipeople Australia Pty Ltd* Australia Dormant
Citipeople USA Inc* United States of America Dormant
The Company owns directly or indirectly (indicated *) 100% of the equity share capital and voting rights of all companies.
13. Debtors
Group Company
2006 2005 2006 2005
£000 £000 £000 £000
T rade debtors 13,377 9,946 ––
Amounts owed by group undertakings –– 3,229 6,764
Accrued income 4,629 3,761 ––
Prepayments and other debtors 1,058 943 120 119
Rent deposits 836 663 ––
Deferred tax (note 6(c)) 210 156 82 –
20,110 15,469 3,431 6,883
The rent deposits relate to the Group’ s premises in the UK and overseas and are recoverable after more than one year.
Notes to the financial statements
at 31 December 2006 Group report and accounts 2006 | 37
Notes to the financial statements
at 31 December 2006
14. Creditors: amounts falling due within one year
Group Company
2006 2005 2006 2005
£000 £000 £000 £000
Bank overdraft –– 695 –
T rade creditors 1,362 1,433 37 15
Amounts owed to group undertakings –– 2,374 4,996
Deferred consideration – 609 – 609
Corporation tax (note 6(d)) 1,401 1,553 –8
Loan notes payable 453 1,307 453 1,307
Other taxes and social security costs 2,817 2,518 34 175
Other creditors and accruals 3,655 3,080 213 336
9,688 10,500 3,806 7,446
15. Provisions for liabilities and charges
Group
Onerous T otal
lease Contingent provision for
provision consideration liabilities and
charges
£000 £000 £000
At 1 January 2006 (restated) – 3,442 3,442
Released during the year – (1,240) (1,240)
Foreign exchange difference arising – (47) (47)
Arising during the year 370 – 370
At 31 December 2006 370 2,155 2,525
Company
T otal
Contingent provision for
consideration liabilities and
charges
£000 £000
At 1 January 2006 (restated) 3,442 3,442
Released during the year (1,240) (1,240)
Foreign exchange difference arising (47) (47)
At 31 December 2006 2,155 2,155
The contingent consideration arises on the acquisition of Accreate Limited and is discussed in more detail in notes 22 and 23.
The onerous lease provision has arisen from the reorganisation of the business as described in note 3. 38 | Group report and accounts 2006
16. Analysis of net funds
Group At At
31 December Other 31 December
2005 Cash flow movements 2006
£000 £000 £000 £000
Cash at bank and in hand 3,169 1,097 41 4,307
Loan note deposits 1,307 (854) – 453
Loan notes payable (1,307) 854 – (453)
3,169 1,097 41 4,307
17. Share capital
Authorised
2006 2005
£000 £000
Ordinary shares of 1p each 1,000 1,000
Allotted, called up and fully paid
2006 2005
No. £000 No. £000
Ordinary shares of 1p each 37,297,229 373 36,225,363 362
Related to the acquisition of Accreate Limited, the Company issued 208,842 ordinary shares with an aggregate
nominal value of £2,088 to the vendors of Accreate for a total non-cash consideration of £621,375 (e900,000).
Related to the acquisition of Ingram Consultancy Limited, on 19 July 2006, the Company issued 115,924 ordinary
shares with an aggregate nominal value of £1,159 to the vendor of Ingram Consultancy Limited for a total non-
cash consideration of £300,000.
During the year the Company also issued 747,100 ordinary shares with an aggregate nominal value of £7,471 to
holders of options over the Company’ s ordinary shares (who were entitled under the rules of the Company’ s share
option schemes to exercise their options) for a total cash consideration of £77,546.
Employee share option schemes
The Company operates three share option schemes, under which options to subscribe for the Company’ s ordinary
shares of 1p each have been awarded to certain employees (“Optionholders”). These are an Employee
Management Incentive Scheme (“EMI”), an Inland Revenue approved scheme (“ Approved”), and an unapproved
scheme (“Unapproved”).
Under the EMI scheme, the vesting period ranges from 3 to 5 years and the vesting of certain grants to
Optionholders are also subject to the achievement of specific performance criteria over this period. Under the
approved and unapproved schemes, the vesting period is 3 years.
Under all three schemes, Options are forfeited if they remain unexercised after a period of more than 10 years
from the date of grant. Options are also forfeited if the Optionholder ceases to hold office with a Group member
before the options vest, with certain exceptions (“good leaver” provisions). Options vest and become exercisable
in the event of a takeover or reconstruction of the Group. All options are non-transferable and there are no cash
settlement alternatives.
Notes to the financial statements
at 31 December 2006 Group report and accounts 2006 | 39
Notes to the financial statements
at 31 December 2006
17. Share capital (continued)
The following tables illustrate the number and weighted average exercise prices (“WAEP”) of, and movements in, each of the
share option schemes during the year:
EMI 2006 2005
WAEP WAEP
Options pence Options pence
Outstanding at 1 January 3,391,090 78.2 3,334,884 41.4
Granted during the year 152,947 297.8 811,206 206.2
Forfeited during the year (717,495) 59.8 (725,000) 48.8
Exercised during the year (717,100) 6.9 (30,000) 157.5
Outstanding at 31 December 2,109,442 124.7 3,391,090 78.2
Exercisable at 31 December 793,332 35.5 1,326,432 18.8
The range of exercise prices for options outstanding at the end of the year (which are subject to the forfeiture provisions
noted above) was as follows:
2006 2005
Price range Options Price range Options
Exercisable from 1 January 2006 1p – 80p 613,332 1p – 80p 1,798,332
Exercisable from 1 January 2007 37p – 49p 191,250 37p – 49p 191,250
Exercisable from 1 January 2008 37p – 145p 203,451 37p – 145p 236,738
Exercisable from 1 January 2009 140p – 293p 794,531 140p – 278p 933,971
Exercisable from 1 January 2010 204p – 318p 306,878 204p – 287p 230,799
2,109,442 3,391,090
Approved 2006 2005
WAEP WAEP
Options pence Options pence
Outstanding at 1 January 1,104,409 230.6 384,344 121.4
Granted during the year 708,898 286.2 1,042,469 256.8
Forfeited during the year (540,562) 264.8 (260,904) 208.1
Exercised during the year (30,000) 94.4 (61,500) 85.0
Outstanding at 31 December 1,242,745 250.7 1,104,409 230.6
Exercisable at 31 December 33,000 66.7 23,000 35.0
The range of exercise prices for options outstanding at the end of the year was 35 pence to 295 pence (2005 – 35 pence to
295 pence). 40 | Group report and accounts 2006
17. Share capital (continued)
Unapproved 2006 2005
WAEP WAEP
Options pence Options pence
Outstanding at 1 January 1,448,161 116.1 1,047,522 68.0
Granted during the year 514,075 281.2 431,235 243.9
Forfeited during the year (392,443) 180.6 (30,596) 177.0
Outstanding at 31 December 1,569,793 154.8 1,448,161 116.1
Exercisable at 31 December 456,668 37.5 456,668 37.5
The range of exercise prices for options outstanding at the end of the year was 37 pence to 295 pence (2005 – 37
pence to 295 pence).
The weighted average share price at the date of exercise for share options exercised under all three schemes
during the year was 288.1 pence (2005 – 268.5 pence).
For the share options outstanding under all three schemes at 31 December 2006, the weighted average remaining
contractual life is 7.88 years (2005 – 7.73 years).
Other equity incentives
In addition to the share option schemes, the Group has a complementary incentivisation plan for a limited
number of key employees (the ‘‘Plan’’). The Plan enables relevant personnel to participate in any increase in
shareholder value over a specified period, thereby aligning their interests with those of shareholders.
Under the arrangements, the Company has set up an offshore employee benefit trust (the “Imprint Plc Employee
Benefit Trust” or “EBT”) for the benefit of present and future employees of the Company. The Company has
granted options over new ordinary shares to the EBT , for onward grant to employees, which become exercisable
upon a predetermined event, such exercise price to be met from the sale of the ordinary shares under option.
The independent trustees of the EBT have discretion over how any funds held by the EBT are used, although
consideration is given by the trustees to the wishes of the beneficiaries, and to suggestions made by the Company
as to allocation of the EBT funds. The Company cannot benefit from any funds held in the EBT .
During the year the trustees awarded equity interests over ordinary Imprint shares already under option (“Equity
Interests”) following awards of options by the Company to the EBT . These interests vest on the earlier of:
• the occurrence of an offer for the issued ordinary share capital of the Company which is made on a condition
such that if satisfied, the person or persons making the offer will have control of the Company;
• the making of a resolution for the voluntary winding up of the Company; or
• the making of a winding up order of the Company by the Court.
Notes to the financial statements
at 31 December 2006 Group report and accounts 2006 | 41
Notes to the financial statements
at 31 December 2006
17. Share capital (continued)
The following table illustrates the number and weighted average exercise prices (“WAEP”) of, and movements in, Equity
Interests within the Plan during the year:
2006 2005
Equity WAEP Equity WAEP
Interests pence Interests pence
Outstanding at 1 January 532,049 285.5 ––
Granted during the year 583,121 300.0 532,049 285.5
Outstanding at 31 December 1,115,170 293.1 532,049 285.5
None of the Equity Interests had vested at 31 December 2006 or 31 December 2005. The range of exercise prices for
Equity Interests outstanding at the end of the year was 284 pence to 300 pence (2005 – 284 pence to 287 pence).
Fair value of equity instruments
The fair value of equity-settled share options granted and the Equity Interests are estimated as at the date of grant
using a Black-Scholes model, taking into account the terms and conditions upon which the options or interests
were granted. There are no market conditions which need to be taken into account in measuring the fair value of
share options or Equity Interests. Furthermore, all options and interests are granted with an exercise price equal to
the market value of the shares under option at the date of grant. The following table lists the inputs to the model
used for the year ended 31 December 2006 and the year ended 31 December 2005.
2006 2005
Dividend yield (%) 2.0 2.0
Expected share price volatility (%) 30.4 30.4
Risk-free interest rate (%) 4.31 4.32
Liquidity discount (%) 2.0 – 15.0 2.0 – 15.0
Expected life (years):
– EMI share options 6.0 – 9.0 6.0 – 9.0
– Approved share options 3.5 – 6.5 3.5 – 6.5
– Unapproved share options 3.5 – 6.5 3.5 – 6.5
– Equity Interests within the Plan 5.0 5.0
The expected lives are based on the Group’ s best estimate and are not necessarily indicative of exercise patterns
that might occur. The expected volatility has been calculated by reference to the historical volatility of Imprint Plc
shares since its incorporation in 2001 and by comparison to the volatility of similar listed entities for which share
price information is available.
The expense recognised in the profit and loss account for share-based payments and the corresponding
movement within reserves during the period to 31 December 2006 is £280,000 (2005 – £175,000). 42 | Group report and accounts 2006
18. Reserves
Group Share premium Shares to Profit and
account be issued loss account T otal
£000 £000 £000 £000
At 1 January 2006 – as previously reported 39,303 1,721 1,254 42,278
Prior year adjustment (note 1) – (1,721) – (1,721)
At 1 January 2006 – as restated 39,303 – 1,254 40,557
Profit for the financial year –– 6,682 6,682
Dividends paid –– (1,219) (1,219)
Foreign currency translation differences –– (155) (155)
Credit in respect of share-based payments –– 280 280
New shares issued 988 –– 988
At 31 December 2006 40,291 – 6,842 47,133
Company Share premium Shares to Profit and
account be issued loss account T otal
£000 £000 £000 £000
At 1 January 2006 (as previously reported) 39,303 1,721 (330) 40,694
Prior year adjustment (note 1) – (1,721) – (1,721)
At 1 January 2006 – as restated 39,303 – (330) 38,973
Profit for the financial year –– 1,678 1,678
Dividends paid –– (1,219) (1,219)
Credit in respect of share option schemes –– 280 280
New shares issued 988 –– 988
At 31 December 2006 40,291 – 409 40,700
19. Other financial commitments
Group
Annual commitments under non-cancellable operating leases are as follows:
Land and buildings
2006 2005
£000 £000
Operating leases which expire:
between one and two years 486 –
between two and five years 399 530
in more than five years 675 908
1,560 1,438
The Company had no such commitments.
20. Pensions commitments
The Group makes contributions to both directors’ and employees’ personal pension plans. Contributions
amounting to £59,000 in respect of employees were unpaid at 31 December 2006 (2005 – £21,000) which were
settled after the year end under normal payment arrangements.
Notes to the financial statements
at 31 December 2006 Group report and accounts 2006 | 43
Notes to the financial statements
at 31 December 2006
21. Related party transactions
There are no related party transactions requiring disclosure in 2006.
During the year ended 31 December 2005 the Group paid £10,000 to Adelaide Capital Corporation Limited, a
company based in Ireland of which Pierce Casey is a director, for advisory services related to the acquisition of
Accreate Limited. These services were paid for by the Company. There were no balances outstanding in respect
of this transaction at the year end.
22. Financial instruments
Treasury policies and nature of financial instruments held
The Group operates treasury policies, which include the ongoing assessment of interest rate management. Cash
surpluses are invested in short-term deposits. The Group’ s liquidity objective is to maintain a balance between
continuity of funding and flexibility. The Board approves all decisions on treasury policy.
The Group’ s principal financial instruments comprise cash, short-term deposits, loan note deposits, loan notes
payable, contingent consideration and a revolving credit facility (not utilised at 31 December 2006 nor 31
December 2005). The main purpose of these instruments is to finance the Group’ s operations and acquisitions.
The Group has other financial instruments, such as trade debtors and trade creditors that arise directly from its
operations. The Group does not trade financial instruments, nor hedge its financial exposures.
Cash and deposits
The cash and short-term deposits balance at 31 December 2006 was £4,307,000 (2005 – £3,169,000), which
comprised current account balances of £3,820,000 (2005 – £2,631,000) and deposit account balances of £487,000
(2005 – £538,000). These balances include amounts held in foreign currencies as listed in the table below. No
interest is earned on the current accounts. Interest is earned on both the deposit and call accounts at floating
interest rates. Surplus funds are held where practical in the call account to maximise interest income.
Rent deposits of £836,000 (2005 – £663,000) are owed to the Group, of which £546,000 earns interest at a floating
rate. There are no material differences between the book value and fair value of these instruments.
Balances held in foreign currencies 2006 2005
£000 £000
Euro 472 463
Japanese Y en 303 149
US Dollar/Hong Kong Dollar 171 94
Singapore Dollar 261 17
United Arab Emirates Dirham 99 –
1,306 723
Revolving credit facility
The Company has a revolving credit facility available for use of up to £7.5m (2005 – £5.5m). Interest is currently
payable on advances made under the revolving credit facility at the rate of 1 per cent over LIBOR. The facility
expires on 30 April 2009. The Company has given security, covenants and warranties usual for a facility of this
nature, including a first and only debenture from each Group company and a composite guarantee by each Group
company in favour of the Group’ s bankers.
Loan notes
The loan note deposits are held in collateralised accounts guaranteed by the Group’ s bankers for the purposes of
settling the Group’ s outstanding loan note liabilities. Loan notes amounting to £854,000, previously deposited to
these collateralised accounts in relation to the acquisitions of ECHM and Morgan McKinley, were redeemed
during the course of the year. These were funded by equal and matching payments from the loan note deposit
accounts. At 31 December 2006 £453,000 (2005 – £1,307,000) was still held on deposit to fund the loan note
liabilities at that date. The Group earns and pays interest on the loan note deposits and loan notes at floating
interest rates. 44 | Group report and accounts 2006
22. Financial instruments (continued)
Contingent consideration
At 31 December 2005 the Group had recognised contingent consideration relating to its acquisition of Accreate
Limited (refer note 23) amounting to £3,442,000 (e5,000,000). This balance represents further potential cash and
share consideration contingent upon the profits of Accreate in the years ending 31 December 2005, 31 December
2006 and 31 December 2007, up to a maximum in each year ofe1,600,000 (e1,800,000 in the first year). Any
additional consideration is payable within 90 days of each year end and is payable as to 50 per cent in cash and 50
per cent by the issue of new ordinary shares valued at the average closing mid market price for the seven trading
days prior to the date of payment (subject to a floor of £2.00 per share).
Of this balance, £1,239,000 (e1,800,000) was paid in March 2006 (50% in cash, 50% through the issue of new
ordinary shares), representing the maximum consideration payable in respect of profits achieved by Accreate for
the year ended 31 December 2005.
At 31 December 2006 the remaining maximum cash element of the contingent consideration, £1,077,000
(e1,600,000) and the maximum share element, £1,077,000 (e1,600,000) are disclosed within provisions for
liabilities and charges. Both elements are valued at their undiscounted amounts and in the directors’ opinion
there is no material difference between the book value and fair value of these instruments.
Foreign currencies
The main functional currencies of the Group are Sterling, Euro, US Dollar, Hong Kong Dollar, Japanese Yen,
Singapore Dollar and United Arab Emirates Dirham. The Group does not have material transactional currency
exposures nor is there a material exposure to foreign-denominated monetary assets and liabilities, because
exchange risks associated with revenues earned in foreign currencies are largely offset by operating costs arising in
the same currency. The Group is exposed to foreign currency translation differences in accounting for its overseas
operations although the Group’ s policy is not to hedge this exposure.
T otal exchange losses/(gains) for the year arose as follows:
2006 2005
£000 £000
T rading balances 30 41
T ranslation of net assets of subsidiary undertakings
and hedges against group equity investments in foreign enterprises 155 (16)
185 25
Notes to the financial statements
at 31 December 2006 Group report and accounts 2006 | 45
Notes to the financial statements
at 31 December 2006
23. Acquisitions
On 19 July 2006 the Company acquired the entire issued share capital of Ingram Consultancy Limited,
incorporated in Jersey, the holding company of a recruitment company based in Dubai. The initial consideration
of £1.2 million was funded by a combination of cash and shares.
During the year, final fair value reviews were carried out on the assets and liabilities purchased through the
acquisitions made in 2005.
Details of these fair value adjustments and the acquisition of Ingram Consultancy Limited are set out below.
Summary of acquisition of Ingram Consultancy Limited
Provisional
Fair value fair value
Book value adjustments to Group
£000 £000 £000
Assets and liabilities acquired 136 – 136
Goodwill arising on acquisition 1,136
1,272
Fair value of consideration:
Shares issued 300
Cash 900
1,200
Costs associated with the acquisition 72
Fair value of consideration at 31 December 2006 1,272
At 31 December 2006 no contingent consideration has been provided on this acquisition. T otal further potential
consideration amounts to £3.8 million contingent upon the profits of the business in the three years ending 31
December 2008. This will be recognised in future periods if justified by the level of profits achieved. 46 | Group report and accounts 2006
23. Acquisitions (continued)
Acquisition of ECHM
Provisional
fair value Fair value Fair value
to Group adjustments to Group
2005 2006
£000 £000 £000
Intangible fixed assets – purchased goodwill 32 – 32
T angible fixed assets 224 – 224
Debtors 3,629 (324) 3,305
Cash at bank 447 – 447
Bank loans and overdrafts (412) – (412)
Creditors (2,921) – (2,921)
Net assets acquired 999 (324) 675
Goodwill arising on acquisition 9,128 324 9,452
10,127 – 10,127
Fair value of consideration:
Shares issued 3,630 – 3,630
Loan notes 2,535 – 2,535
Cash 3,465 – 3,465
9,630 – 9,630
Costs associated with the acquisition 497 – 497
10,127 – 10,127
The fair value adjustment relates to the write off of unrecoverable accrued income and trade debtor balances
existing at the date of acquisition.
Acquisition of Morgan McKinley
Provisional
fair value Fair value Fair value
to Group adjustments to Group
2005 2006
£000 £000 £000
T angible fixed assets 223 – 223
Debtors 6,183 (100) 6,083
Bank loans and overdrafts (542) – (542)
Creditors (1,378) – (1,378)
Net assets acquired 4,486 (100) 4,386
Goodwill arising on acquisition 20,621 100 20,721
25,107 – 25,107
Fair value of consideration:
Shares issued 2,447 – 2,447
Loan notes 1,151 – 1,151
Cash 20,402 – 20,402
Deferred cash consideration 818 – 818
24,818 – 24,818
Costs associated with the acquisition 289 – 289
25,107 – 25,107
The fair value adjustment relates to the write off of unrecoverable accrued income existing at the date
of acquisition.
Notes to the financial statements
at 31 December 2006 Group report and accounts 2006 | 47
Notes to the financial statements
at 31 December 2006
23. Acquisitions (continued)
Acquisition of Accreate Ltd
Provisional
fair value Fair value
to Group Adjustments to Group
2005 2006
£000 £000 £000
Assets and liabilities acquired 171 – 171
Goodwill arising on acquisition 5,483 – 5,494
5,654 – 5,665
Fair value of consideration:
Shares issued 1,016 – 1,016
Cash 1,070 – 1,070
Contingent cash consideration 1,721 (19) 1,702
Contingent share consideration 1,721 (18) 1,703
5,528 (37) 5,491
Costs associated with the acquisition 126 – 126
5,654 (37) 5,617
The adjustment relates to the foreign exchange incurred on payment of part of the contingent consideration during the year
and the translation of the remaining contingent consideration at the foreign exchange rate ruling at the balance sheet date. 48 | Group report and accounts 2006
Directors Pierce Casey , Chairman
John Gordon, Non-Executive Director
Brian Hamill, Chief Executive Officer
John Hunter, Chief Operating Officer
Robert Thesiger, Executive Director
Colin Webster, Chief Financial Officer
Nominated Adviser Altium Capital Limited
30 St James’ s Square
London
SW1Y 4AL
Secretary Blakelaw Secretaries Limited
New Court
1 Barnes Wallis Road
Segensworth
Fareham
Hampshire
PO15 5UA
Auditors Ernst & Y oung LLP
1 More London Place
London
SE1 2AF
Bankers Lloyds TSB Bank Plc
Ground Floor
10 Gresham Street
London
EC2V 7AE
Solicitors Blake Lapthorn Linnell
Kings Court
21 Brunswick Place
Southampton
Hampshire
SO15 2AQ
Registered office 2 Sheraton Street
London
W1F 8BH
Registered No. 4119955
Directors and advisers Group report and accounts 2006 | 49
Imprint Plc
(Incorporated and registered in England and Wales under number 4119955)
Notice is hereby given that the Annual General Meeting of Imprint Plc (the “Company”) will be held at 2 Sheraton
Street, London W1F 8BH on 19 April 2007 at 10.00am for the purpose of considering and, if thought fit, passing the
following resolutions which will be proposed, in the case of resolutions 1 to 5 as ordinary resolutions and, in the
case of resolution 6, as a special resolution:
Ordinary resolutions
1. T o receive and adopt the financial statements of the Company for the year ended 31 December 2006 and the
reports of the directors and auditors thereon.
2. T o approve a final dividend in respect of 2006.
3. T o re-appoint Ernst and Young LLP as auditors to the Company.
4. T o authorise the directors to fix the auditors’ remuneration.
5. In substitution for and to the exclusion of the authority conferred upon the directors by ordinary resolution
passed on 10 May 2006 but without prejudice to the allotment of any relevant securities already made pursuant
thereto, to generally and unconditionally authorise the directors pursuant to and in accordance with section 80
of the Companies Act 1985 (as amended) (the “Act”) to exercise all the powers of the Company to allot relevant
securities (as defined in section 80(2) of the Act) up to an aggregate nominal amount of £124,390 for a period
expiring (unless previously renewed, revoked or varied by the Company in general meeting) on the earlier of
the date falling 15 months after the passing of this resolution and the conclusion of the annual general meeting
of the Company to be held in 2008 provided that the Company may make an offer or agreement before the
expiry of such authority which would or might require relevant securities to be allotted after the expiry of such
authority and the directors may allot relevant securities in pursuance of that offer or agreement as if the power
conferred hereby had not expired.
Special resolution
6. In substitution for and to the exclusion of the authority conferred upon the directors by special resolution
passed on 10 May 2006 but without prejudice to the allotment of any equity securities already made pursuant
thereto, to empower the directors in accordance with section 95 of the Act to allot equity securities of the
Company (within the meaning of section 94(2) of the Act) pursuant to the authority referred to in, and
conferred by, resolution 5 above as if section 89(1) of the Act did not apply to the allotment, provided that
this power:
(a) expires on the earlier of the date falling 15 months after the passing of this resolution and the conclusion of
the annual general meeting of the Company to be held in 2008 save that the Company may make an offer or
agreement before the expiry of such authority which would or might require equity securities to be allotted
after the expiry of such authority and the directors may allot equity securities in pursuance of that offer or
agreement as if the power conferred hereby had not expired; and
(b) is limited to the allotment of equity securities:
(i) where such securities have been offered (whether by way of rights issue, open offer or otherwise) to
holders of ordinary shares in the capital of the Company in proportion (as nearly as may be) to their
existing holdings of ordinary shares but subject to the directors having a right to make such exclusions
or other arrangements in connection with the offer as they deem necessary or expedient to deal with
equity securities representing fractional entitlements and legal or practical problems under the laws of,
or the requirements of, any recognised regulatory body or any stock exchange in any territory; and
(ii)(otherwise than pursuant to sub-paragraph (b)(i) above) up to an aggregate nominal amount of £18,658.
By order of the board Registered Office:
Colin Webster 2 Sheraton Street
Chief Financial Officer London
W1F 8BH
23 February 2007
Notice of annual
general meeting 50 | Group report and accounts 2006
Notes:
1. The directors believe that passing resolutions 5 and 6 is in the best interests of the Company and its
shareholders and will give the directors flexibility in administering the business of the Company in the year
ahead. Accordingly, while the directors have no present intention of exercising such authorities they
unanimously recommend that shareholders vote in favour of them. Resolutions 5 and 6 and the limits on the
authorities contained therein are consistent with the current recommendations of the Investment Committees
of the Association of British Insurers and the National Association of Pension Funds generally adhered to by
public companies and are intended to ensure that the interests of existing shareholders are protected.
2. A corporation which is a member of the Company may, by resolution of its directors, authorise such person
as it thinks fit to act as its representative at the meeting.
3. A member of the Company who is entitled to attend and vote at the meeting may appoint one or more
proxies to attend and, on a poll, vote instead of him. Such proxy need not be a member of the Company.
4. The register of interests of the directors of the Company and their families, copies of the contracts of service
and letters of engagement of such directors and the existing Memorandum and Articles of Association of the
Company will be available for inspection at the registered office of the Company during normal business hours
(Saturdays, Sundays and public holidays excepted) from the date of this notice until the close of the meeting.
5. T o be valid the enclosed form of proxy, together with the power of attorney or other authority (if any) under
which it is signed or a notarially certified copy of such power of attorney or authority must be completed,
signed and received at the Proxy Processing Centre, T elford Road, Bicester OX26 4LD as soon as possible and in
any event by 3.00pm on 17 April 2007 (the “Specified Time’’). Appointment of a proxy will not preclude a
member from attending the meeting and voting in person should that member subsequently so decide.
6. In accordance with Regulation 41 of the Uncertificated Securities Regulations 2001 (the “Regulations”), the
Company gives notice that only those members entered on the relevant register of members (the “Register”)
for certificated or uncertificated shares of the Company (as the case may be) at the Specified Time will be
entitled to attend and vote at the meeting in respect of the number of shares registered in their name at that
time. Changes to entries on the Register after the Specified Time will be disregarded in determining the rights
of any person to attend or vote at the meeting. Should the meeting be adjourned to a time not more than 48
hours after the Specified Time, that time will also apply for the purposes of determining the entitlement of
members to attend and vote (and for the purposes of determining the number of votes they may cast) at the
adjourned meeting. Should the meeting be adjourned for a longer period, then to be so entitled, members
must be entered on the Register at the time which is 48 hours before the time fixed for the adjourned meeting
or, if the Company gives notice of the adjourned meeting, at the time specified in such notice.
7. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment
service may do so for the meeting and any adjournment(s) thereof by using the procedures described in the
CREST Reference Manual (the “Manual”). CREST personal members or other CREST sponsored members, and
those CREST members who have appointed voting service provider(s), should refer to their CREST sponsor or
voting service provider(s), who will be able to take the appropriate action on their behalf.
In order for a proxy appointment 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
CRESTCo’ s specifications regardless of whether it constitutes the appointment of a proxy or an amendment to
the instruction given to a previously appointed proxy and must, in order to be valid, be transmitted so as to be
received by the Company’ s agent (IDRA10) by the Specified Time. For this purpose, the time of receipt will be
taken to be the time (as determined by the timestamp applied to the message by the CREST Applications Host)
from which the Company’ 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.
CREST members and, where applicable, their CREST sponsors or voting service providers should note that
CRESTCo does not make available special procedures in CREST for any particular messages. Normal system
timings and limitations will therefore apply in relation to the input of CREST Proxy Instructions. It is the
responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member
or sponsored member or has appointed voting service provider(s), to procure that his CREST sponsor or voting
service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means
of the CREST system by any particular time. In this connection, CREST members and, where applicable, their
CREST sponsors or voting service providers are referred, in particular, to those sections of the Manual
concerning practical limitations of the CREST system and timings.
The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation
35(5)(a) of the Regulations.
Notice of annual
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