Annual Report 
2014/2015   Contents
 1 Key highlights
 2 Chairman’s statement
  Strategic report
 4 The dotmailer platform
 6 How it works
 8 Growth strategy
 10 Global client list
 12 Our culture
 14 Key performance indicators
 16 Risks, mitigations and impact
 18 Chief Executive’s report 
 26 Corporate social responsibility report
  Governance
 28 Board of Directors
 30 Corporate governance report
 31 Audit Committee report
 32 Remuneration Committee report
 34 Report of the Directors
 36 Report of the independent auditor
  Financial statements
 38 Consolidated income statement
 38 Consolidated statement of comprehensive income
 39	 Consolidated	statement	of	financial	position
 40	 Company	statement	of	financial	position
 41 Consolidated statement of changes in equity
 42 Company statement of changes in equity
 43	 Consolidated	statement	of	cash	flows
 43	 Company	statement	of	cash	flows
 44	 Notes	to	the	consolidated	financial	statements
 68 Company information  Key highlights
Group revenues up 32%  
(from £16.2m to £21.4m)
EBITDA increase by 45% to £6.8m
Net cash generated from  
operating activities of £5.4m
Strong cash position of £11.9m  
as at 30 June 2015
Corporate statement
dotdigital Group’s flagship product is 
dotmailer, an email and multi-channel 
automation platform that enables 
marketers to plan, target, create, deploy, 
track and analyse their campaigns.
We understand what marketers need 
from a technology platform and bring 
together features and usability in a 
way that no one else does. Supported 
by world-class strategic and creative 
services we make it easy for our clients 
to achieve dramatic results that grow 
their business.
dotdigital Group Plc
Annual Report 2014/2015
1 Chairman’s 
statement
dotdigital has delivered great results for 
the 2014/15 financial year. The Group 
continues to be cash generative with 
no debt and we finished the year with 
cash reserves of £11.9m, an increase 
of 28% on the prior year, after capital 
expenditure and product development 
costs of £2.3m. The Group returned  
a profit before tax of £5.2m for the  
year, which was ahead marginally of 
market expectations. 
Our change in emphasis of how we sell to 
clients outlined last year has been successful 
and our average monthly spend by customer 
has increased by 41%. In addition 94% of new 
clients signed in the past year have signed 
longer-term contracts giving the Group greater 
visibility on future revenue. We have also made 
significant progress with Magento customers, 
who tend to be higher volume senders, and 
these clients now spend considerably more  
with us on a monthly basis than other clients. 
Frank Beechinor-Collins
Non-Executive Chairman
During this past year we have focused on 
building our indirect sales through partners and 
distributors and we have signed a number of 
high-profile partnership agreements in North 
America and Asia Pacific. 
We continue to make good progress in the 
US and our business there has grown by over 
114%, signing a number of significant new 
clients in that market. We also established an 
office in Australia which will focus on driving 
sales across the Asia Pacific region, primarily 
through carefully selected partners. This 
operation is now headed up by Rohan Lock, 
who for the past five years, was head of sales  
in the UK. We’ve already seen a good level of 
sign ups through our partners 
Our professional services division has continued 
to grow in the past year, achieving nearly £3m of 
sales, up 56% on the previous year ,with good 
profit margins. We have invested considerably 
in our infrastructure, ensuring that the business 
has the ability to offer the service expected 
by our customers as our business expands 
in both the volume of emails we send and the 
geographical markets in which we operate. 
Development in our dotmailer platform 
continues to ensure it conforms to scalability, 
localisation and compliance in our new markets 
and product updates and enhancements have 
been well received by our customers. 
As with previous years, our policy on 
acquisitions remains unchanged. Our  
continued focus is on organic growth but  
we will consider acquisition opportunities, 
should they arise, and only if they allow us  
to accelerate growth in a market or provide  
us with a technolological advantage.
Our international revenues 
have grown by 97% – 
driven by the focus on 
geographic expansion
dotdigital Group Plc
Annual Report 2014/2015
2 An evolving team 
During the past year we have evolved the plc 
and operational boards to ensure we have the 
requisite skills to grow our business in line with 
market expectations. Peter Simmonds, who  
has been CEO for the past eight years, left at 
the end of June 2015. We identified Simone 
Barratt as Peter’ s successor in 2014 and during 
the past year both Peter and Simone have 
worked on the transition in the months leading 
up to Peter’ s retirement and Simone taking on 
the role of CEO. 
On behalf of the Board I would like to take this 
opportunity to thank Peter for the considerable 
effort he has put in to building the business 
and ensuring we have effective processes and 
controls in place so that we can achieve growth 
whilst remaining profitable and cash generative. 
We are delighted that Peter continues as a 
significant shareholder of the business and he 
has also agreed to remain on the Board as a 
Non-Executive Director. 
Simone has an extensive knowledge of the 
email marketing space and her previous 
experience as a Non-Executive Director of the 
Company before becoming CEO has meant she 
had an excellent understanding of the business. 
Simone has focused on building the executive 
management team to ensure the business has 
the requisite skills as we progress through this 
stage of our evolution.
Milan Patel continues to do an excellent  
job as CFO under Simone, with a focus on 
effective planning and good financial control, 
thus ensuring our ongoing profitability and  
cash generation. 
Founders Simon Bird and Tink T aylor continue 
as Board members and to play a strategic 
role in the business. Both have provided great 
support to the executive management team. 
Tink has been instrumental in helping our 
overseas expansion in not just North America 
but in Central America and Australia. Simon 
identified and recruited Steve Shaw who has 
taken over as  IT Director and who, in turn, has 
made great strides in both the development of 
our main product suite and the infrastructure 
required for running our platform. 
On behalf of all our stakeholders, I would 
like to thank the team at dotdigital for their 
fantastic contribution to another successful 
year. I would also like to say a special thank you 
to the executive management team for their 
continued commitment, hard work and passion 
in developing the business.
Outlook 
The outlook for dotdigital over the coming years 
is very promising with interesting opportunities 
both in the UK and in overseas markets. We 
plan to continue to grow our business via a 
direct sales model but, increasingly, we see 
indirect channel and partnerships as a very 
effective way to achieve significant growth 
internationally. The rebranding and repositioning 
of the business has helped fulfil our ambition 
to be seen as a supplier of choice in the mid-
market. With this team and the strategy outlined 
here we look forward to another successful  
year ahead.
Frank Beechinor-Collins
Non-Executive Chairman
dotdigital Group Plc
Annual Report 2014/2015
3 dotdigital Group Plc
Annual Report 2014/2015
4
The dotmailer platform
Strategic report
Continuing growth
The flagship product, dotmailer, is a powerful 
email and multi-channel marketing automation 
platform with easy to use tools that enable 
marketers to efficiently create, manage, execute 
and evaluate effective targeted campaigns.
In addition to its automation technologies, 
the Group also provides expert multi-channel 
marketing consultancy and services for 
businesses seeking to maximise customer 
acquisition, conversion and retention. The 
Company is headquartered in London and 
employed 190 staff at the end of June 2015.
Email continues to be the top-performing digital 
channel as confirmed in eConsultancy’ s 2014 
Email Marketing Industry Census, with 68% 
rating the channel as Excellent or Good.  
This finding was echoed in the UK Direct 
Marketing Association report which shows the 
average ROI for email campaigns has actually 
risen 53% to £38 for every £1 spent in 2014.  
Increased scalability
dotmailer is a well-established product and 
over the past eight years we have seen strong 
evidence of the scalability of the Group’ s 
platform with monthly sends volumes growing 
from under 5m sends per month to currently 
over 500m per month.
The Group has carried out significant 
development work on the dotmailer platform 
over the years, providing continuous innovation 
and functionality to its users.
This includes a highly compelling visual drag 
and drop email template design, drag and drop 
segmentation and query builder, drag and drop 
campaign automation, translation of the user 
interface into eight languages and responsive 
template toolkits that optimise display content 
and layout on mobile devices (smartphones  
and tablets). Our platform’ s ease of use, ease 
of integration and innovation combine to allow 
customers of all sizes and abilities to join us,  
and grow with us.
World class integrations
The company also has specialist and 
deep pre-built integrations with best-in- 
class eCommmerce platforms and CRM 
products such as Magento, SalesForce  
and Microsoft Dynamics. 
In addition the platform has been designed to 
integrate easily with clients’ existing marketing 
technology and systems.
dotmailer has a broad customer base, with the 
five largest clients accounting for approximately 
5% of total revenues (the top 20 clients account 
for less than 10% of total revenue).  
T o some extent, this reflects some of the 
Group’ s historical success in the SME space 
but, increasingly, the Group is gaining solid 
traction in the mid-to-small enterprise market  
in the UK, US and Asia Pacific. 
An email and multi-channel automation platform 
for digital marketers.
IMAGINATION...DELIVERED dotdigital Group Plc
Annual Report 2014/2015
5
Email 
marketing
Email 
automation
Multi-channel 
automation
Platform
Features 
Ready. Set. Grow.
dotmailer provides clients around the world with marketing tools 
that are easy to use yet provide all the functionality that  
a mid sized or small enterprise needs now and as they grow.
Multi-channel
Advanced personalisation
Lead nurturing & scoring
Behavioural analysis
Landing pages
Automated campaigns
Insight & complex data
Integrations
Forms & surveys
Campaign reporting
Segment & triggers
Email marketing
When we saw dotmailer, we were  
totally blown away. It was way ahead  
of anything else we saw. The decision 
was a no-brainer.
Steve Smith
eCRM Manager
City & Guilds Data in
Integrations make it fast
and easy for customers to
pull their data into dotmailer
Ecommerce data
CRM data
Social data
Messages out
Our multi-channel marketing
automation platform empowers
marketers with the tools they need
Integrations
Insight & complex data
Behavioral analysis
Lead nurturing & scoring
Forms & surveys
Landing pages
Email marketing
Segment & triggers
Automated campaigns
Advanced personalisation
Multi-channel
Campaign reporting 
including
Content & other assets
Systems & databases
Web & email
Tablets & dekstops
Sales teams
Cloud applications
Online channels
Data warehouses
including
including Calls, SMS & messaging
dotdigital Group Plc
Annual Report 2014/2015
6
How dotmailer works
Strategic report Data in
Integrations make it fast
and easy for customers to
pull their data into dotmailer
Ecommerce data
CRM data
Social data
Messages out
Our multi-channel marketing
automation platform empowers
marketers with the tools they need
Integrations
Insight & complex data
Behavioral analysis
Lead nurturing & scoring
Forms & surveys
Landing pages
Email marketing
Segment & triggers
Automated campaigns
Advanced personalisation
Multi-channel
Campaign reporting 
including
Content & other assets
Systems & databases
Web & email
Tablets & dekstops
Sales teams
Cloud applications
Online channels
Data warehouses
including
including Calls, SMS & messaging
dotdigital Group Plc
Annual Report 2014/2015
7
A client once described our platform 
as NASA technology with a Fisher Price 
interface. We liked that. It stuck. It’s now  
a mantra for our product development.  
Tink Taylor,
Founder, dotmailer dotdigital Group Plc
Annual Report 2014/2015
8
Our revenues from outside the UK have grown from 3% in 2012/2013, to 10% in 2013/2014 and now 
to 15% in 2014/2015. We expect this % to increase through 2015/2016 with the bulk of these overseas 
revenues coming from the US and Asia Pacific. 
Our choice of strategic partners has been influenced by their geographic footprint to enable us to further 
penetrate other regions.
Our growth strategy
Enhancing shareholder value by focusing on profitable  
growth and product innovation. 
In 2014/2015 we continued to build on our existing partner relationships in eCommerce and CRM  
by focusing on our specialist connectors for Magento, MS Dynamics CRM and Salesforce. 
2015/2016, we plan to focus on developing a robust Global Reseller network, whilst our Direct Sales  
team continues to grow our organic direct business. Additionally, we are excited about early progress  
in developing Key Strategic Partnerships that will drive our presence globally.
In 2014/2015 we delivered a number of significant new product features including Multi-channel extensions, 
insight data, advanced personalisation, lead scoring, fully personalised landing pages and substantial 
enhancements to our market leading integrations with Magento, MS Dynamics CRM and Salesforce. 
From a revenue perspective we saw an increase in recurring revenues from technology of 207% especially  
our marketing automation functionality. Going forward, in support of our international and partner growth 
strategy we will look to further globalize our product suite and our infrastructure.  In addition, we have identified 
the following themes for our roadmap:  platform extensibility, single customer view, real-time customer 
experience, predictive capabilities, eCommerce, email innovation, social.
Geographic 
expansion
Strategic 
partnerships  
and channel
Product 
innovation
Identifying 
new niches
Our historic focus on the eCommerce niche has delivered good revenues (261% increase 2014/2015) as 
well as positioning us to be strategic partners of key global players such as Magento. This, in turn, has also 
driven our geographic growth. 
For the coming year, we have identified an opportunity to exploit our localisation and multi-lingual capabilities 
and drive revenues through this niche. 
Our shareholder base expects a low-risk approach to investment. Over the past seven years as 
a public company we have a good track record of testing, learning and then investing in growth 
opportunities. As the Company has grown we have also taken care to protect our core customer 
base whilst looking to deliver strong top-line growth through:
Strategic report Barbour 
Case study 
Case study
In terms of bottom line a single 
direct campaign has generated  
a six-figure revenue amount, with  
a ROI of 37,581%.
 
Elaine Taylor
Manager
Barbour International
Overcoming the obstacles 
Barbour have been on a rapid learning curve with the 
evolution of its ecommerce business. The sole business 
goal has been to deliver a seamless customer experience. 
The obstacles to overcome have been many: building a 
detailed customer database, segmenting the audience, 
creating engaging content, integration between systems, 
personalising the experience.
Smarter, scalable results 
Throughout this journey dotmailer have provided 
strong and consistent support to Barbour as 
they gradually adopt smarter and smarter email 
marketing automation tactics. This means tailored 
engagement programmes using past purchasing 
history are now sent as standard, automatically. 
The results are great but also scalable as the online 
business continues to grow.
dotdigital Group Plc
Annual Report 2014/2015
9 dotdigital Group Plc
Annual Report 2014/2015
10
Global client list
dotmailer is the trusted email marketing partner  
of huge success stories around the world.
Major clients
Strategic report dotdigital Group Plc
Annual Report 2014/2015
11
New clients New Magento clients
When I saw the EasyEditor in action  
I realised it is as easy as using Lego.
Chris Hipson
Customer Experience 
Econsultancy dotdigital Group Plc
Annual Report 2014/2015
Two peas. Same pod.
We attract staff and clients that sing 
from the same hymn sheet as us. It’s  
an ethos that binds us together. Truth 
is, we’re more like family and friends 
than a company. 
It’s our business to know your business. 
We run a business. You run a business. 
Bottom lines are top of mind for us. 
That’s why everything we do for you – 
and ourselves – is considered, thought 
through and viable. 
Our culture
The dotmailer platform is built to be flexible and  
easy to work with. As a Company, we like to think  
we’re the same. 
12
Strategic report
The Group understands the critical role our 
people play in the success of the business. 
We continue to invest in their development 
and other initiatives that build upon the great 
culture that is at the heart of our business. dotdigital Group Plc
Annual Report 2014/2015
13
On your marks. Get set. Grow.
Your success is our success. That’s why 
we grow our own people to be the 
best they can, so they can help your 
business to be the best it can. We don’t 
do the status quo. Now, off we grow. 
We’re an unlimited Company. 
We never sit still. Good enough isn’t  
good enough for us. We’re always 
thinking, always doing, always creating. 
Why? We love what we do. We care 
about how we do it. We think you  
will too. 
No nonsense.
Straight. Honest. Open. Truthful (even 
if it hurts). We don’t do business speak. 
We prefer common sense. That’s 
what the best and most successful 
relationships are based on.  dotdigital Group Plc
Annual Report 2014/2015
14
Key performance indicators
We use our key performance indicators (KPIs) to 
measure our business. These indicators provide us 
with the visibility of both our strategic and financial 
performance. Employee remuneration is specifically 
linked to these KPIs. 
Revenue growth from continuing operation
We aim to deliver double-digit organic revenue growth.
Earnings before interest, tax, depreciation and amortisation (EBITDA)
We aim to have a positive EBITDA growth.
Cash position
We aim to have a strong cash position. 
2014
2014
2014
2015
2015
2015
£16,213,000
£4,697,000
£9,306,000
£21,366,000
£6,772,000
£11,932,000
32% Growth
45% Growth
28% Growth
33% Growth 
13% Growth
53% Growth
Financial
Strategic report dotdigital Group Plc
Annual Report 2014/2015
15
Volume of emails sent
We aim to keep increasing the amount of emails sent through the system.
Recurring revenue as a %
We aim to have recurring revenues of over 70%.
Percentage of revenue from customers outside of the UK
We aim to expand internationally.
2014
2014
2015
2015
3,700,000,000
5,760,000,000
76% Recurring revenue
78% Recurring revenue
2014
2015
15% Outside of the UK
10% Outside of the UK
Strategic
One of the first things that 
appealed to us was the creative 
freedom dotmailer provides.
Edward Huang
Financial Officer
Alex Woo dotdigital Group Plc
Annual Report 2014/2015
16
Risk area Impact Mitigation of risk
Supplier, 
computer 
hardware 
and internet 
reliability-related 
risks
An event resulting in a hosting centre going 
offline for any significant period of time or the 
termination of provision of services by one of 
the Group’s hosting centres for any reason 
may result in significant loss of revenues and 
therefore materially harm the Group’s business, 
operating results and financial condition. 
Similarly, events preventing or obstructing the 
servers from communicating over the internet, 
such as the future availability of a finite number 
of IPv4 addresses, may restrict the capacity of 
the business.
The design of the platform along with the system’s architecture has multiple 
levels of resilience built in to cater for single points of failure. The Group 
continuously evaluates its key suppliers as part of its risk management 
process and diversifies these where possible, to improve resiliency. There 
is continued investment into dotmailer’s currently owned IP addresses, 
maintaining these to be reputable for sending email globally, and utilising 
them to maximum effect. The Group continues to monitor its IPv4 capacity 
and seeks opportunities to expand its pool or utilise newer technologies to 
limit exposure to this risk. 
Utilisation of 
cloud service 
providers
A key strategy for the Group is to migrate 
the dotmailer platform to a hybrid cloud 
infrastructure, utilising cloud service providers 
to host the web and application functions of the 
platform. Failure to implement correctly could 
result in an unstable, or less efficient platform 
resulting in lower number of email sends, 
and ultimately lowering the confidence in the 
product. 
The nature of cloud computing also means that 
a majority of the dotmailer platform will sit on 
shared infrastructure that is more of a target for 
cyber-attacks.
Dedicated teams have been formed to deliver the migration project; with 
consultation from experts and the cloud service providers, the team have a 
clearly defined architecture & design and where risks have been identified 
tests have been run to prove resolutions. The testing/migration process 
will be phased to identify and resolve any issues before impacting core 
business.
By utilising cloud service providers, economies of scale are inherited 
from the provider in terms of computing power, bandwidth, and security 
technologies, mitigating other corporate risks.
Hacking & 
information 
security
There is a possible risk that a direct or indirect 
hacking attempt could result in a denial of 
service and/or loss of data which would impact 
on the Group’s reputation. 
The Group’s technical team takes measured actions across multiple levels 
to secure the dotmailer platform and its customers’ data. Continued 
investment into the latest technology for threat detection, remediation and 
encryption, coupled with its security policies and penetration tests, greatly 
reduces the Group’s exposure to this risk.
The introduction of a dedicated security function within the business to 
oversee existing and improvements in technology, processes, and policy 
was a strategic decision to further reduce the risk in this area. The Group 
has invested, and will continue to invest significantly in this area to protect 
ourselves from the latest threats.
Data privacy 
Such laws and regulations require or may require 
the Group and its clients to implement privacy 
and security policies, permit consumers to 
access, correct or delete personal information 
stored or maintained by such companies, inform 
individuals of security incidents that affect their 
personal information, and, in some cases, obtain 
consent to use personal information for certain 
purposes. Other possible legislation could, if 
enacted, impose additional requirements and 
prohibit the use of certain technologies, such 
as those that track individuals’ activities on web 
pages or record when individuals click on a link 
contained in an email message. Such laws and 
regulations could restrict the Group’s clients’ 
ability to collect and use email addresses, web 
browsing data and personal information, which 
may reduce demand for its products.
The Group operates an open door policy whereby it shares its policies 
relating to security & data privacy. dotmailer has a Trust Centre where 
customers can view this information online. Its features also assist 
customers to be compliant in current legislation and in most cases 
automates these compliance processes. The Group’s staff research the 
impact of new legislation to its customers (and in some cases are actively 
involved in the creation of the legislation & industry best practise) and 
publish related white papers and blogs. Its executive actively contributes 
to the digital marketing space to advocate best practice and make sure its 
customers’ needs are represented.
Risks, mitigations 
and impact
Strategic report dotdigital Group Plc
Annual Report 2014/2015
17
Risk area Impact Mitigation of risk
Internet service 
providers (ISPs) 
reputation and 
internet browser, 
related risks
As a large proportion of the Group’s revenue is 
derived by charging a price per email for sending 
marketing emails on behalf of customers, the 
impact of not being able to deliver these or 
deliver these without engagement tracking for 
any reason is significant. If internet browsers 
detect hyperlinks as a phishing threat, if abuse 
complaints from providers are not dealt with 
properly, if bad customer data generates multiple 
complaints through ISPs or third party spam 
blacklists, these impact the platform’s overall 
ability to effectively deliver email. 
dotmailer provides a number of services as part of the core product to 
filter known or bad data that may not comply with EU, Asia Pacific or US 
anti-spam regulations. Continued investment in reputation & security-
related product development with the addition of more third party data 
feeds to filter bad data continues to reduce the risk. Through its admittance 
to various industry groups, notably the Messaging Malware Mobile 
Anti-Abuse Working Group (M3AAWG), the Group has demonstrated its 
commitment to implementing industry best practice in anti-abuse. It also 
provides a number of consultancy services to its customers to better 
improve their data and compliance with legislation. Through its expansion 
of its deliverability team, the Group continues to work closely with ISPs, 
email receivers and third party spam lists by proactively dealing with abuse 
complaints generated by customer emails. Whilst dotmailer acts as the 
data processor on behalf of its customers, and is not directly liable for 
breach of the EU, Asia Pacific or US anti-spam regulations, it does take 
these breaches seriously, suspending or terminating customer service 
agreements if necessary. 
Competitive 
environment 
The sector the Group operates in is competitive. 
The impact of competitors having more features, 
increased financial backing, better brand 
recognition and better global coverage increases 
the risk to the Group’s business model.
The Group continues to grow revenues year-on year and reinvests to 
deliver new product features, best-in-class customer support and service 
offerings, enhanced brand recognition, improved service delivery and 
markets globally to attract new customers. 
International 
expansion 
As the business expands into new geographic 
territories there is a risk that policies and 
practices that have worked successfully in the 
UK market will not provide the high level of 
service and assurance that would have been 
delivered in the UK market. 
The Group will place an emphasis on hiring senior people with experience 
of developing successful international business models, whilst hiring quality 
local people in important International territories. The Group will also utilise 
the services of expert advisers as and when necessary. Management 
information, business intelligence, audits and risk appraisals will be 
updated and monitored to ensure they reflect the International nature of the 
business.
Hire and retain 
key personnel 
The loss of the services of key employees could 
harm the Group’s business. The future success 
of the Group also depends on its ability to 
identify, attract and retain highly skilled technical, 
managerial and sales personnel. The Group 
faces intense competition for qualified individuals 
from numerous technology, ecommerce and 
marketing companies.
Investment into talent acquisition hiring programmes and continuous 
learning and development has enabled the Group to hire and retain highly 
skilled individuals. Enhanced employee benefits, a competitive packageand 
a modern and flexible working environment utilising the latest technologies 
have continued to mitigate this risk.
Development and 
maintenance of 
products
There is a possible risk that without continued 
investment into new products, enhancement of 
old products and into new sectors the growth of 
the Group will be impaired. 
As new products are developed, and 
the technology landscape changes, the 
maintenance burden of existing products 
increases and without continued investment 
maintaining those products they may become 
unusable and could affect the Group’s revenue. 
Investment into the Group’s product offerings continues to enable good 
growth. Innovation and increased development of new core product 
offerings in the marketing automations space has opened up more revenue 
opportunities and increased the average recurring revenue of the Group’s 
existing customers. Ease of use of the dotmailer offerings and the ability 
to offer flexibility to integrate and connect to best-of-breed products 
continue to enable the Group’s customers to grow at their pace without 
constraints. The Group constantly reviews individual product performance 
and the technology landscape and makes decisions to optimise its product 
portfolio if necessary to reduce maintenance overheads. 
Evolving 
technology 
and customer 
requirements
Failure to respond to evolving technological 
channels and customer requirements or to 
introduce competitive enhancements and new 
features may make the dotmailer solution less 
competitive. The introduction of new solutions 
by competitors potentially makes the Group’s 
solutions less attractive or easy to sell. Failure to 
anticipate client requirements and successfully 
develop new solutions or features may impact 
growth and retention of existing clients.
Investment in development of new solutions, partnerships with best-of-
breed third parties and enhancements to the platform means that the Group 
remains a credible provider of multi-channel marketing SaaS solutions. SaaS 
development requires implementation of rapidly changing technologies, 
adhering to standards and regulations, anticipating client requirements 
and frequent product enhancements. The Group has not aligned itself to a 
single vertical, neither B2B nor B2C, and this strategy is purposeful for risk 
reduction. Where competitors introduce new solutions generally targeted 
at verticals, the breadth of the dotmailer platform, providing solutions 
across sectors, still differentiates dotmailer from its competitors. It delights 
customers, enabling them to grow and adapt without the need to change 
their marketing platform. This in conjunction with, a continued emphasis in 
recruiting and retaining expert technical and marketing professionals, has 
enabled the Group to innovate within its sector. dotdigital Group Plc
Annual Report 2014/2015
18
Chief Executive’s  
report
Introduction 
I am pleased to announce that the Group 
delivered revenue growth in line with market 
guidance. Our EBITDA and profit before tax are 
both marginally ahead of market guidance.
This performance is a result of continued strong 
organic growth in the high-margin and long-
term recurring revenues generated by our core 
multichannel marketing product, dotmailer, both 
in the UK and, increasingly, overseas.
Financial highlights 
  30.06.15 30.06.14 %
  (£m) (£m) increase
Revenue 21.4 16.2 32%
EBITDA 6.8 4.7 45%
Net assets 18.4 14.2 30%
EPS 1.63 1.24 31%
Review of 2014/2015 
Revenue performance, which grew in line  
with expectations, was driven by strong  
growth of 32% across the Group’ s core  
high-margin email and multi-channel  
automation SaaS platform.
Simone Barratt
Chief Executive Officer
This strong organic growth was underpinned 
by a combination of successful new client 
wins in the mid-market and small enterprise 
sectors and, in particular, amongst Magento 
eCommerce platform users. There has also 
been healthy growth in recurring revenue from 
existing clients, and the Group has signed up  
a higher proportion of clients under contracts 
than in the previous period.
The Group continues to win notable clients in 
the UK in both the B2B and B2C sectors. In 
the past year these include: Honeywell, Unison, 
Ordnance Survey, The All England Lawn T ennis 
and Croquet Club, Knight Frank, Sony Music, 
Links of London, Sole Trader, Ladbrokes and 
Natural History Museum.   
We have also seen a strong performance from 
our enabling professional services offerings 
with an increase in revenue from £1.8m to 
approximately £2.8m, an increase of 56% year 
on year with margins in the region of 60%.  
During the year, the Group’ s average monthly 
spend per client rose by approximately 41% 
from £315 in the prior financial year to £445 in 
2014/15. This, combined with a focus on longer 
term contracts (94% of clients that signed up 
in the year are on contracts between 12 and 
24 months), and client retention has resulted in 
higher client lifetime values.
International growth 
Revenues from the US performed strongly, 
increasing from US$1.4m to US$3.0m, an 
increase of over 114% compared to the same 
period last year. The East Coast sales office, 
located in New York, continues to focus on 
sector niches including Magento eCommerce 
platform users and higher value small enterprise 
clients. As a result the Group has secured  
a number of new clients, including Simple 
Human, La Vie en Rose, Sail Plein Air Inc & 
T eam Velocity Marketing.
The Group has also made good early progress 
in the Asia Pacific region and the Group has 
established strong partner relationships in 
Australia and solid revenue pipelines building 
through these channels. 
We are in the process of undertaking a 
pilot utilising the localisation and translation 
capabilities of our platform in LATAM with  
a partner. 
Easy to use yet incredibly 
powerful, dotmailer is 
increasingly becoming 
the platform of choice 
for digital marketing 
professionals.
Strategic report dotdigital Group Plc
Annual Report 2014/2015
19
Magento Connector 
The quality of dotdigital’ s connector into the 
Magento eCommerce platform and the Group’ s 
ability to build strong relationships with Magento 
partners has resulted in significant increased 
revenues during the year.
The number of our clients now using dotmailer’ s 
Magento Connector has more than doubled 
during the financial year. The average monthly 
recurring revenue spend for a typical Magento 
customer has also grown to approximately 
£1,070 per month, a 53% increase on the 
previous year. 
Magento Connector UK clients now include 
The Royal Trust Collection, Fred Perry, Boodles, 
Calor Gas and Hornby.
We have also signed a number of Magento 
Systems Integration partners as resellers for 
the dotmailer platform, including Gorilla, a Gold 
Magento Solution Partner with offices across 
the US and Europe, and named as Magento’ s 
Omni-channel Partner of the Year in April 2015. 
Technology, product development  
and support
Within the year we have restructured our 
technology, product development and support 
teams. The teams are now clearly aligned with 
operational support for our clients and our 
infrastructure, or on our product roadmap. 
 
Also, within the year we have revised our 
approach to our product development and 
release process. Our new approach has 
delivered increasingly innovative software in an 
agile manner, but in a more structured quarterly 
release process. The key tenets of our product 
development strategy remain ‘ease of use’ 
and ‘ease of integration’. Our highly skilled and 
creative team of developers continue to create 
functionality that makes it easy for our clients to 
deliver complex marketing processes, and easy 
for marketers to integrate with the best-of-breed 
platforms they already use. 
People 
After a two-year term as a Non-Executive 
Director, I took over the CEO role on  
24 February 2015. Peter Simmonds stepped 
down as Deputy CEO on 30 June 2015 and  
I am delighted Peter remains on the Board  
as a Non-Executive Director. 
Peter’s leaving party
Our first campaign 
generated over £6m 
worth of business and  
set the scene for 
everything we do today. 
It’s fair to say we’ve not 
looked back since!
Phil O’Sullivan
Marketing Director
Newmarket Holidays dotdigital Group Plc
Annual Report 2014/2015
20
2013/2014 was a year of important investment 
in new hires and the appointment of new senior 
management. During 2014/2015 these new 
hires have been successfully integrated into the 
business. The senior management team have 
implemented new structures and processes 
to support our ambitious growth plans whilst 
driving operational efficiencies for the business. 
As a result we have delivered a 32% increase 
in revenue, a 45% increase in EBITDA for a 
nominal 8% increase in headcount.
Another key hire in April 2015 was Chief Privacy 
Officer, James Koons, a high-profile industry 
expert who is based in the US. As outlined in 
the Risks and Mitigation section of this Report, 
our reputation with ISPs around the world and 
our knowledge of and approach to global data 
privacy legislation are critical to providing our 
clients with the highest level of protection and 
security and to ensuring we continue to deliver 
their emails around the world.
Cash generation 
The business continues to be highly cash 
generative with cash at the end of the period 
standing at £11.9m, an increase of 28% on the 
prior year (2014: £9.3m) after capital expenditure 
and product development of £2.3m. The Group 
continues to be debt free. Highly efficient cash 
collection processes, combined with over 
45% of clients paying retainers by direct debit, 
contributed to the Group’ s strong cash position 
at the year end.
Dividend policy 
I am pleased to announce that the Board has 
conducted a review of the business plans for the 
next three years including evaluating the cash 
needs for increased investment in both organic 
growth and capital expenditure and has decided 
that an increase in dividend can be proposed 
this year.
Therefore, subject to approval at the AGM in 
December 2015, the Board propose that the 
Group will pay a dividend of 0.36 pence per 
share, payable at the end of January 2016.
Growth strategy  
During the year we evaluated a number of 
potential acquisition opportunities in the email 
marketing space. However, as in prior years 
none of the businesses evaluated were judged 
to be likely to create long-term shareholder 
value when execution and integration risks 
were factored in. We will, of course, continue to 
consider acquisition opportunities if they arise.
We anticipate further organic growth in the  
UK market and will continue to offer our 
products directly to a wide range of industry 
sectors. Growth will come from winning 
business from competitors as well as from 
developing and promoting additional and 
increasingly sophisticated personalisation and 
automation product functionality to our existing 
customer base.
We have established a strong brand presence in 
the US, especially in the growing B2C and B2B 
eCommerce sectors, and we anticipate further 
penetration and growth. Growth to date has 
been as a result of the quality of our connector 
to the Magento platform and our Gold Standard 
Partnership. Going forward, we will continue to 
focus on growing our network and relationships 
with the system Integrators who service and 
influence the Magento community and on 
continuing to broaden and deepen our product 
offering to this sector.
We are pleased with the early results of a pilot in 
LATAM (Latin America), commencing in October 
2014 and conducted with a partner utilising 
our localisation technologies to translate our 
interface to the local market. 
In addition, we expect to augment this growth 
through further expansion; into the Americas 
and Asia Pacific, and via strategic and channel 
partners and resellers. 
Chief Executive’s  
report continued
Over the past seven 
years, revenues have 
grown 346% from £4.8m 
to £21.4m (year to June 
2015). This equates to a 
seven-year CAGR of 24%, 
which is higher than the 
market growth in that 
time, reflecting market 
share gains.
Strategic report
James Koons 
Chief Privacy Officer Naylors 
Case study 
Case study
Rapid growth
Since going digital, Naylors has transformed from a 
local equestrian and country wear retailer into a highly a 
successful ecommerce business on the national stage. 
Since 2012 they’ve been working with ecommerce 
agency Space 48 to develop their offering on the 
Magento Enterprise platform. 
Impressive results
For the email solution, they initially used Mailchimp, but they rapidly 
bumped up against the limits of a free solution. That was when their 
ecommerce agency suggested they look at dotmailer.
One of the first attractions they could see from migrating to the dotmailer 
was the ability to integrate their Magento customer purchasing data. This 
has been used to implement a fully integrated multichannel strategy that 
makes best use of automation to provide seamless transactions and the 
best possible customer service. They are looking forward to introducing 
even more automation in the future. 
Since making the shift to dotmailer the results have been impressive. 
Naylors have seen massive returns, A 219% increase in revenue, 186% 
increase in transactions, average order value increase of 11%, and a 21% 
increase in conversion from email to purchase. 
dotdigital Group Plc
Annual Report 2014/2015
21
dotmailer’s people are very 
informative and a source of 
inspiration. The results we’ve  
seen of working with Magento 
and dotmailer have been 
extremely powerful.
 
James Atkinson
Partner at Naylors dotdigital Group Plc
Annual Report 2014/2015
22
TUI  
Case study
A global operation
TUI AG is the largest leisure, travel and tourism company in 
the world. It owns travel agencies, hotels, airlines, cruise ships 
and retail stores. Its major subsidiaries include TUI Airlines, 
the largest holiday fleet in Europe, as well as UK-based tour 
operator Thomson. In total the brand covers nearly 80 tour 
operators operating from 18 countries.
An integrated success
Using dotmailer they’ve implemented a successful three-year 
programme to integrate email, CRM, web and sales reporting. 
The dotmailer platform has increased their ability to send out 
effective communications, whilst allowing TUI staff a deeper 
understanding of their market and customers.
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Annual Report 2014/2015
23
Email delivery remains a high priority and we  
will retain a small physical infrastructure 
presence in key regions to act as delivery nodes. 
This ensures we have full control over our IP 
address ranges and their reputation, which  
are crucial for email delivery.
These additional dotmailer instances will 
allow us to scale and spread risk, putting us 
in stronger position to continue to deliver on 
our customers expectations and to handle 
continued growth.
The model of growing internationally by focusing 
on key partners has proven to be successful 
and profitable in the US. The Group aims  
to take the same focused approach to growing 
our new office in Australia, identifying a number 
of key partners and resellers who have an 
existing footprint in Australia and the broader 
Asia Pacific region. 
Going forward, we will deepen existing 
relationships, and identify new local and global 
strategic partners to fast track our penetration 
into specific sectors, niches or geographies. 
The Group will also exploit what we believe to 
be an opportunity in the market – particularly 
in the US – to provide an alternative email and 
multi-channel automation platform to a network 
of mid-sized resellers and we are currently hiring 
to exploit this opportunity. 
This growth will be supported by a technology 
programme that delivers scale internationally. 
We are encouraged by the response we have 
had from partners and see this as a key tenet  
for our growth strategy in future. 
Technology and infrastructure
We continue to invest in technology and 
infrastructure to cater for a growing international 
customer base. dotdigital has recently 
commenced a three-year hybrid-cloud 
infrastructure project – Project Cirrus – with  
the key aim of deploying our platform into  
new territories: North America (to support 
growth in the Americas), and Australia (to 
support growth in Asia Pacific). This will provide 
our clients with increased performance and 
resilience and the ability to keep their data  
within their economic region. 
Chief Executive’s  
report continued Chief Executive’s  
report continued
Looking forward 
The dotmailer email marketing and multi-
channel automation platform continues 
to perform strongly both in the UK and, 
increasingly, internationally.
In readiness for the next phase of our growth 
I have created a Senior Executive T eam that 
sits between the Plc Board and the cross-
departmental Operations Board. In addition 
to myself and Milan Patel, CFO, the Senior 
Executive T eam comprises Sharon Head – 
previously Director of Operations, now Chief 
Operating Officer, and Steve Shaw – previously 
Director of T echnology, now Chief T echnology 
Officer. This structure will allow us to allocate 
senior executive sponsorship to key global 
strategic partnerships. For clarification, these are 
not Plc Board appointments. 
T ogether with the recent appointment of Anup 
Khera to the role of Senior Vice President (SVP) 
of Global Sales, and Phil Draper as Marketing 
Director, the Group is well placed with a  
strong team of senior executives to deliver  
future results.
Further growth in the US will be supported by 
new sales offices in the MidWest and West 
Coast. These offices will be located to mirror the 
concentrations of Magento systems integrators, 
allowing us to forge stronger relationships and to 
provide those Integrators with local support.
Rohan Lock, who has headed the UK sales 
team for five years, is now responsible for the 
Asia Pacific region, based in Australia. He has 
considerable experience of building an effective 
sales organisation in the UK and is expected to 
help the Group accelerate sales growth in this 
region. Hiring a sales team has already begun 
and early indications from the Asia Pacific region 
show strong interest from high-value strategic 
channel partners and a growing pipeline. 
The initiatives to grow our 
international presence are 
now delivering a strong 
pipeline of new clients 
particularly in the mid-size 
online retail space which 
continues to be a core 
focus for 2015.
dotdigital Group Plc
Annual Report 2014/2015
24
Strategic report
In addition to channel partners, resellers are 
important for the Group’ s growth ambitions 
including further penetration into the US as 
well as for entering new markets. T o this end 
the Group plans to appoint a Global Reseller 
Director who will be based in the US. There 
have been a number of acquisitions in the  
email marketing sector and the Directors  
believe this has created an opportunity for 
dotmailer to replace their current platform. 
The ongoing investment in technology and 
product development, and the resulting  
new multi-channel automation functionality 
launched in early 2015, has helped the  
Group build new revenues. The Directors believe 
this will increase both the quality and quantum 
of recurring revenues from our technology,  
and also from a recently introduced range of 
new productised multi-channel automation 
services offerings.
 In summary, the demand for email marketing 
and multi-channel automation continues to be 
strong both in the UK and internationally. The 
Board believes that the dotmailer platform, 
with its ‘ease of use’ proposition, its specialist 
connectors, its specialist professional services, 
and now its growing list of global strategic 
partnerships, is well placed to continue to 
generate strong organic growth in revenue, not 
just in the UK, but increasingly overseas as well.
Phil Draper 
Marketing Director
Steve Shaw 
Chief T echnology Officer
Anup Khera 
SVP Global Sales
Sharon Head 
Chief Operating Officer FairFX 
Case study
Case study
Easy automation
FairFX switched to using dotmailer a year ago. They 
have implemented a number of dotmailer’ s automation 
tools, all of which are generating additional turnover  
for the business. 
All the results. No more effort
With no ongoing input once the original content and parameters 
for the automation campaign have been set up it’ s a win win for the 
client. The results of the campaign are increases year on year, 17% 
more visits to the website this year, 73% increase in conversion 
rates, 103% increase in transactions and 121% increase in revenue. 
Within just two days of launching the first programme FairFX 
generated additional turnover running into five figures. Over a year 
this adds up to over a million pounds of additional revenue from a 
totally automated service.
dotdigital Group Plc
Annual Report 2014/2015
25
dotmailer is all about delivering 
service that goes beyond the 
norm. They are very effective 
and professional team who know 
what they’re talking about, and 
help me to get the best out of  
my digital marketing.
Lisa Stone 
Marketing Manager 
FairFX dotdigital Group Plc
Annual Report 2014/2015
26
Employees
The Group has continued to invest in the 
development of our people across the Group 
thus underpinning the critical role that our 
employees play in the success of the business.
The Board has significantly enhanced the 
training and development programme available, 
to provide all employees with access to 
bespoke key skills training, as well as continuing 
specific skills development in areas relating 
to the industry we operate in and, in addition, 
professional skills development. The Group  
now has a greater percentage of employees 
than ever before studying towards and achieving 
professional qualifications, equipping themselves 
and the business with specialist expertise.
The Board’ s commitment to an open and 
honest working environment continues with 
clear communication of business progress 
through monthly ‘All Hands’ Company 
meetings; including an anonymous ‘Ask 
the Board’ Directors questions slot, regular 
newsletters, and lunches for new and existing 
employees with the Board. 
The Board strives to continue to offer a 
competitive benefits package in order to attract 
and retain the best talent, including share option 
schemes and bonuses based on Company and 
individual performance. T otal reward statements 
are available to all employees to provide 
complete visibility into the total value of salaries, 
benefits and rewards earned through the year. 
It is the policy of the Group to ensure that at 
all times there are equal opportunities for all 
employees, with no discrimination on account  
of race, age, gender, sexual orientation,  
disability and political or religious beliefs.  
Our philosophy is to ensure that ability, 
contribution to the business and potential to 
develop are the determining factors in the 
selection, training, career development and 
promotion of all employees.
Investment in our offices continues, ensuring  
a pleasant and safe working environment for  
all employees. Above all, the Board continually 
monitor that our workplaces are safe  
and comply with all relevant legislation; the 
Group has not been subject to sanctions or 
fines for environmental, health and safety or 
other infringements.
Business partnership
dotdigital believes that strong and effective 
partnerships, within our business community, 
is an important factor that promotes mutual 
success for our partners and suppliers. As 
dotdigital continues to act on its strategy 
of global growth, we will build upon our UK 
experience in the US, Australia and beyond. 
Our constantly evolving and expanding partner 
network is key to developing close business 
relationships through informal and formal 
events, meet-ups and seminars. We share the 
advantage of our cutting-edge office space to 
support and host an increasing number of such 
events. The business benefits that these close 
relationships provide are immediate and obvious 
to all involved.
 
Our commitment to using local businesses 
wherever possible is consistent even as we 
launch in Australia, making use of local providers 
of products and services where we can.
During the past year the Group continued  
with its ongoing commitment to social 
responsibility in the market in which it  
operates, to its employees, suppliers and  
to the broader environment.
As a company listed on AIM, dotdigital is 
not required to produce a corporate social 
responsibility report. However, the Directors 
believe that in the interest of transparency a  
brief commentary should be included.
Clients
The Group prides itself on ensuring that our 
products and services are designed to meet the 
expectations of our clients and their customers. 
Feature forums are offered to allow clients to 
request features and vote on feature priority, 
which feeds directly into the development 
schedules for our SaaS product offerings. 
The Group is committed to complete 
transparency with our clients, providing 
pricing structures that are clear, and offering 
packages that allow clients to deliver successful 
campaigns. A pricing calculator is provided for 
dotmailer licenses and packages to allow clients 
and potential clients to cost their campaigns, 
and our experienced sales team are able 
assist clients in pricing guidance across all our 
products and services. 
dotdigital products and services are supported 
by an expert team; giving access to support via 
email, telephone and live chat. We also provide 
additional managed services for our products, 
enabling our clients to deliver successful 
campaigns and projects.
Corporate social  
responsibility report
Strategic report dotdigital Group Plc
Annual Report 2014/2015
27
Environmental partnership
Our tried and tested adoption of Reduce, 
Reuse, Recycle runs through all our offices.  
As a digital business we continue to strive to 
reduce printing and waste and increase the 
levels of recycling wherever possible.
Our office hot-desking arrangements and 
flexible approach to appropriate telecommuting 
ensure we avoid unnecessary travel whenever 
possible. 
Ensuring we work with datacentre partners 
that set industry standards in energy efficiency 
ensures we minimise our energy footprint. 
Suppliers
As a part of the Group’ s strong commitment 
to our local community we aim to source local 
suppliers wherever possible. This is underlined 
by the fact that a number of our suppliers have 
been with the Group for many years and we 
consider our key suppliers as partners. dotdigital 
aims to work with partners and suppliers  
with similar ethical standards and values.  
At dotdigital we understand the importance of 
fair and equal treatment, and particularly drive 
towards transparent and fair payment terms  
and processes.
Community partnership 
The dotdigital Group employees need little 
encouragement to show their support for 
local and national charities. This year we have 
invested in relaunching and rebranding our 
employee social group. Volunteers representing 
all departments and offices across the globe 
ensure global representation and engagement. 
Rebranded as dotcommunity, the Group 
has two focuses: inwards (employee social 
engagement) and outwards (philanthropic 
activities). With so many of our employees 
involved in charity fundraising, our Co-Founder 
Tink T aylor set us the task of raising $1,000,000 
for charity. This project is called dotfoundation 
and utilising online and social channels we 
now have a single focus for our fundraising. 
dotfoundation acts as the ‘totaliser’ for all our 
charity fundraising, which currently includes 
Royal Brompton & Harefield Hospitals Charity 
and British Heart Foundation. 
As part of our Client Satisfaction Survey, 
we committed to making a £5 donation for 
each response. This enabled us to donate 
£5,000 across the following charities: St 
Christopher’ s Hospice, Brick by Brick: Homes 
for the Homeless, Deafblind Scotland, Ronald 
McDonald House Manchester, DEC (Disasters 
Emergency Committee) and Marie Curie.
Risks
The Board is cognisant of the need to 
monitor potential threats to the business and 
our workforce. T o this end the Board has 
established a Risk Committee consisting of  
both Non-Executive Directors and management. 
This committee meets regularly to evaluate 
ongoing risks to the business and this includes 
risks posed both to our employees and any 
potential risks to the business from suppliers 
and partners. Any recommendations by this 
committee are put directly to the Board for 
further discussion and implementation. 
Strategic report
The strategic report was approved by a  
duly authorised committee of the Board of 
Directors on 12 October 2015 and signed  
on its behalf by:
 
Milan Patel
Company Secretary
12 October 2015 dotdigital Group Plc
Annual Report 2014/2015
28
Milan Patel, FCCA ACSI
Chief Finance Officer,  
Company Secretary
Milan Patel joined the Company in 
2007 and was appointed Group 
Company Secretary in 2009, and 
CFO in 2015. Milan is a Fellow 
member of the Association of 
Chartered Certified Accountants, 
and associate member of the 
Chartered Institute of Securities 
and Investments. He has been 
responsible for the admission 
to Plus and the introduction to 
AIM. He is also responsible for 
the Group’ s functions in financial 
management and reporting, 
regulatory compliance, legal and 
corporate governance. He also 
brings substantial strategic financial 
experience to the Board.
Ian “Tink” Taylor
Co-Founder
Tink T aylor has 20 years’ 
experience in digital marketing 
in both the UK and now the 
US. Since 2006 he has been 
an influential member of the UK 
Direct Marketing Association’ s 
Email Marketing Council and also 
the Internet Advertising Bureau. 
In 2014, Tink was elected as 
Advisory Committee Member of the 
Board of the US Direct Marketing 
Association’ s Email Experience 
Council. He constantly strives to 
help individual organisations, and 
the industry as a whole, to develop 
and progress.
Simone Barratt
Chief Executive Officer
Simone Barratt has over 15 
years’ experience of ecommerce, 
technology and online marketing.  
She has grown businesses to 
multi $m from incorporation. She 
was appointed Non-Executive 
Director of dotdigital in October 
2013 and stepped into the CEO 
role in February 2015. In 2000 she 
launched and grew e-Dialog in 
Europe and subsequently in Asia 
Pacific. e-Dialog, a leading email 
marketing technology company,  
was acquired by GSI Commerce in 
2008, which in turn was acquired 
by eBay Inc. in 2010. In 2011 
Simone was appointed Global 
President of e-Dialog Inc with 
income statement responsibility for 
just under $100m and with 450 
employees across USA, EMEA  
and Asia Pacific.  
 
Board of Directors
Simon Bird
Co-Founder
Simon Bird has developed an  
in-depth technical knowledge of 
the internet and its applications. 
Prior to co-founding dotdigital 
Group he assisted in the 
development of a major internet 
access provider. He has provided 
services to a number of well-known 
companies and organisations in 
helping create websites, intranets, 
extranets, content management 
systems and other online 
solutions. He is prominent on the 
the tech entrepreneur scene and 
heavily involved in the selection, 
recruitment and retention of 
dotmailer’ s technical partners.
 
Governance dotdigital Group Plc
Annual Report 2014/2015
29
Richard Kellett-Clarke, FCA
Non-Executive Director
Richard Kellett-Clarke brings 
to the Board over 25 years of 
management experience in 
the turnround and strategic 
repositioning and recovery of 
creative businesses in CMCG, 
media, electronics and software 
industries. He was a founder of 
AFX NEWS Limited, now part of 
Thomson Reuters, and Sealed 
Media, now owned by Oracle. He 
was part of the team as CFO which 
brought Pickwick Group Plc to the 
main market and Brady Plc to AIM. 
He is currently the CEO of Idox Plc, 
an AIM-listed specialist software 
and services business.
Frank Beechinor-Collins
Non-Executive Chairman
Frank Beechinor-Collins was, for 
11 years, CEO and co-founder of 
One Click HR, an AIM-listed IT/
Human Resources business which 
operated in the UK and North 
America and had around 200 
employees. Frank oversaw the 
successful sale of the business to 
ADP , a $4bn NYSE-listed company, 
for $25m. Frank brings a great 
deal of corporate experience and 
a strong track record in M&A to 
the Board, gained over 25 years 
of working for and running public 
and private companies. Frank is 
also currently a Non-Executive 
Chairman of Coms Plc an AIM-
listed business.
Peter Simmonds, FCCA
Non-Executive Director
Peter Simmonds has over  
30 years of experience at senior 
management and board level, 
principally in the areas of banking, 
insurance, finance, IT , outsourcing 
and software. As well as being an 
experienced finance professional 
Peter has considerable experience 
of acquisitions, disposals, post-
acquisition integration, change 
management and creating 
cultures and structures to facilitate 
entrepreneurship and growth.
Peter is currently Non-Executive 
Chairman of IS Solutions Plc and a 
Non-Executive Director of Synety 
Plc both AIM-listed businesses. dotdigital Group Plc
Annual Report 2014/2015
30
(b) Directors’ remuneration
As set out on pages 32 and 33, the 
remuneration of the Executive Directors is 
determined by the Remuneration Committee 
whilst that of the Non-Executives is determined 
by the whole Board. The Directors are 
conscious of the importance of performance-
related incentives and bonuses are paid based 
on performance as deemed appropriate by the 
Remuneration Committee. The Remuneration 
Committee uses both financial and non-financial 
benchmarks to determine the Executive  
Director bonuses.
(c) Relations with shareholders
The Group encourages two-way 
communications with all its shareholders  
and responds quickly to all requests or  
queries received. 
All shareholders have at least twenty-one 
working days’ notice of the Annual General 
Meeting at which all of the Directors and the 
Chairman are normally available for questions. 
Comments and questions are encouraged  
from the shareholders at the meeting.
(d) Accountability and Audit
(i) Financial reporting
Detailed reviews of the performance and 
financial position of the Group are included in 
the Chief Executive’ s statement. The Board uses 
this and the Report of the Directors on pages 34 
to 35 to present a balanced and understandable 
assessment of the Group’ s position and 
prospects. The Directors’ responsibility for the 
financial statements is described on page 35.
 
(ii) Internal control
The Board confirms that it has established 
the procedures necessary to implement the 
guidance set out in “Internal Control: Guidance 
for Directors on the Combined Code”. The 
process of risk identification, evaluation and 
management has been considered by the 
Board. It is the intention that this will continue 
to be kept under constant review and will be 
considered at each Board meeting in the future. 
The Board is continuing to take steps to embed 
internal control and risk management further  
into the operations of the business and to  
deal with areas of improvement which come  
to management and the Board’ s attention.
The Directors acknowledge their responsibilities 
for the Group’ s system of internal financial 
control. Such a system can provide reasonable 
but not absolute assurance against material 
misstatement or loss. The Board confirms that 
the procedures necessary to comply with the 
provisions of the Code, including the guidance 
of Turnbull, have been in place throughout the 
year ended 30 June 2015 and up to the date 
of the Report of Directors. It has considered 
the major business risks and the control 
environment. Important control procedures, 
in addition to the day to day supervision of 
the business, include comparison of monthly 
management accounts to the budget.
(iii) Audit Committee and auditors
The Audit Committee comprises Frank 
Beechinor-Collins, Peter Simmonds and is 
chaired by Richard Kellett-Clarke (FCA). The 
auditors of the Group may also attend part or 
all of each meeting and they have direct access 
to the committee for independent discussions, 
without the presence of the Executive 
Directors if required. The Audit Committee may 
examine any matters relating to the financial 
affairs of the Group, and to the Group’ s audit. 
This includes review of the annual accounts 
and announcements, accounting policies, 
compliance with accounting standards,  
the appointment and fees of auditors and  
such other related functions as the Board  
may require.
(iv) Going concern basis
After making enquiries, the Directors have 
formed a judgement, at the time of approving the 
financial statements, that there is a reasonable 
expectation that the Group has adequate 
resources to continue in operational existence 
for the foreseeable future. For this reason the 
Directors continue to adopt the going concern 
basis in preparing the financial statements.
The Board has sought to comply with a 
number of provisions of the 2014 UK Corporate 
Governance Code (‘the Code’) in so far as  
it considers them to be appropriate for a 
company of this size and nature. They make  
no statement of compliance with the Code 
overall and do not ‘explain’ in detail any aspect 
of the Code with which the Group does  
not comply.
Compliance statement
(a) Directors
The details of the Group’ s Board, together with 
the Audit and Remuneration Committees, are 
set out on pages 31 and 32.
The Board meets monthly and is responsible for 
strategy, performance, approval of major capital 
projects and the framework of internal controls. 
The Board has a formal schedule of matters 
reserved for specific review and decision. 
T o enable the Board to discharge its duties, 
all Directors receive appropriate and timely 
information. Briefing papers are distributed to 
all Directors in advance of Board meetings. 
All Directors have access to the advice and 
services of the Company Secretary, who is 
responsible for ensuring that Board procedures 
are followed and that applicable rules and 
regulations are complied with. At the year 
end there were five Executive Directors, one 
independent Non-Executive Director and  
an independent Non-Executive Chairman.
The current constitution of the Remuneration 
Committee and the Audit Committee is shown  
on pages 31 and 32.
Appointments to the Board are nominated  
by an Executive Director and then considered 
by the full Board.
The service contracts of the Executive Directors 
are less than one year and determinable by six 
months’ notice.
Corporate governance  
report
Governance dotdigital Group Plc
Annual Report 2014/2015
31
Composition of the Audit Committee
The Audit Committee comprises Frank 
Beechinor-Collins, Peter Simmonds and  
Richard Kellett-Clarke. The Chairman of the 
Audit Committee is Richard Kellett-Clarke.  
The Committee meets separately with the 
external auditors without management being 
present. The Secretary to the committee is  
Milan Patel, a fellow Director.
Main activities of the Audit Committee
At its meeting on 6 October 2015 the 
Committee reviewed the Group’ s preliminary 
announcement of its results for the financial 
year to 30 June 2015 and the draft report 
and accounts for that year. The Committee 
received reports from the external auditors on 
the conduct of their audit, their review of the 
accounts, including accounting policies and 
areas of judgement, and their comments on  
risk management and control matters. 
The external auditors also presented their 
proposed fees and scope for the forthcoming 
year’ s audit. The Committee also reviewed the 
performance of both the internal accounting 
function and external auditors. The review of 
the external auditors was used to confirm the 
appropriateness of their reappointment and 
included assessment of their independence, 
qualification, expertise and resources,  
and effectiveness of their audit process.
The Audit Committee also reviewed the 
effectiveness of the Company’ s systems for 
internal financial control and risk management. 
The Committee reviewed the Group’ s credit 
control procedures and risks concerning  
IT controls.
The Audit Committee is a sub-committee  
of the Board. The responsibilities of the 
committee include:
• Reviewing the half-yearly and full year 
accounts and results announcements 
of the Group and any other formal 
announcements relating to the Group’s 
financial performance and recommending 
them to the Board for approval;
• Reviewing the Group’s systems for internal 
financial control and risk management;
• Monitoring and reviewing the effectiveness 
of the Group’s internal accounting  
function and considering regular reports 
which arise;
• Considering the appointment of the 
external auditors, overseeing the 
process for their selection and making 
recommendations to the Board in  
relation to their appointment to be  
put to shareholders for approval at a 
general meeting;
• Monitoring and reviewing the effectiveness 
and independence of the external auditors, 
agreeing the nature and scope of their 
audit, agreeing their remuneration, and 
considering their reports on the Group’s 
accounts, reports to shareholders and 
their evaluation of the systems of internal 
financial control and risk management.
Independence of External Auditors
Both the Board and the external auditors have 
safeguards in place to avoid the possibility that 
the auditors’ objectivity and independence  
could be compromised.  
Our policy in respect of services provided by  
the external auditors is as follows:
• Audit-related services – the external 
auditors are invited to provide services 
which, in their position as auditors, they 
must or are best placed to undertake.  
This includes formalities relating to 
borrowings, shareholders’ and other 
circulars, various other regulatory reports 
and work in respect of acquisitions  
and disposals;
• Tax consulting – in cases where they are 
best suited, we use the external auditors. 
All other significant tax consulting work  
is put out to tender;
• General consulting – in recognition 
of public concern over the effect 
of consulting services on auditors’ 
independence, our policy is that the 
external auditors are not invited to tender 
for general consulting work.
Internal management accounting
The Audit Committee reviewed the performance 
of the internal accounting function, the 
department’ s resource requirements and 
also approved the internal budgets for the 
year ended 30 June 2016. The Committee 
concluded that these budgets were both 
prudent and realistic in the context of the 
Group’ s ambitions.
Audit Committee  
report dotdigital Group Plc
Annual Report 2014/2015
32
Key elements of remuneration for 
Executive Directors
The Committee considers the key elements 
in total to ensure there is the right balance 
between reward for short-term success and 
long-term growth. For Executive Directors,  
this is summarised as follows:
Base pay 
Reviewed against:
• Salary levels in comparably sized 
companies listed on AIM;
• Market conditions and company 
performance;
• Level of pay awards in rest of the 
business;
• Role and responsibility of the individual 
Director.
Benefits 
• Aligned to total reward structure for all 
employees;
• Provided on a market competitive basis.
Annual Bonus Scheme
• Group PBT with an individual performance 
element linked to object delivery;
• Drive profitability and strategic change 
across the Group;
• Delivery of the overall business strategy.
Service contracts
The Executive Directors each entered into 
a service contract with the Group. Each 
appointment runs for one year from that date 
and is terminable by six months’ notice by 
either party to expire at the end of that year or 
at any time thereafter. The agreement contains 
restrictive covenants. Upon termination, no 
benefits (other than those accruing during  
the notice period) are due to the Director.
Employee incentive schemes
The Group has awarded share options under 
Enterprise Management Incentive (EMI), 
approved share option schemes to key 
employees who had completed their probation 
period at the date of grant. The Board considers 
the performance of staff in conjunction with 
the Group during the annual review process. 
Discretionary bonuses are awarded based  
on individual and Group performance.
Approved by the Remuneration Committee 
Signed on its behalf by
Richard Kellett-Clarke
Chairman of Remuneration Committee
     12-month period to 30.06.15
      Share-based   Number of 
  Salary/Fees Benefits Bonus Pension payment Total outstanding 
Executive Directors  £’000 £’000 £’000 £’000 £’000 £‘000 options
P Simmonds  175 8 75 18 – 276 –
I Taylor  125 8 25 12 – 170 –
S Bird  120 10 25 14 – 169 –
M Patel  159 11 75 15 20 280 1,427,397
S J Barrett  77 – – – – 77 –
   656 37 200 59 20 972 
The Remuneration Committee
The Group discloses the following information 
on Directors’ remuneration mindful of Rule 19  
of the AIM rules and the fact that as the 
Company is quoted on AIM, it is not required  
to comply with the Main Market UK Listing 
Rules or those aspects of the Companies Act  
which appliy to listed companies regarding the 
disclosure of Directors’ remuneration.
The Committee comprised Richard Kellett-
Clarke (Chairman) and Frank Beechinor-Collins.
The Secretary to the committee is Milan Patel, 
Chief Financial Officer and Company Secretary.
Remuneration policy
The Group’ s executive remuneration policy 
objectives are:
(a) To ensure that individual rewards and 
incentives are directly aligned with the 
performance of the Group and that of  
the interests of the shareholders;
(b) To maintain a competitive package which 
enables the Group to attract and retain 
high-calibre executives; and
(c) To determine the terms of employment 
and remuneration for Executive Directors.
Remuneration  
Committee report
Governance dotdigital Group Plc
Annual Report 2014/2015
33
     12-month period to 30.06.15
      Share-based   Number of 
  Salary/Fees Benefits Bonus Pension payment Total outstanding 
Non-Executive Directors  £’000 £’000 £’000 £’000 £’000 £‘000 options
F Beechinor-Collins  35 – – 1 – 36 –
R Kellett-Clarke  30 – – – – 30 –
S J Barrett  44 – – – – 44 –
   109 – – 1 – 110 
     12-month period to 30.06.14
      Share-based   Number of 
  Salary/Fees Benefits Bonus Pension payment Total outstanding 
Executive Directors  £’000 £’000 £’000 £’000 £’000 £‘000 options
P Simmonds  140 7 90 14 – 251 –
I Taylor  120 7 65 12 – 204 –
S Bird  120 7 65 12 – 204 –
G Fidura  53 4 – 2 – 59 2,137,932
M Patel  36 3 65 2 5 111 2,087,397
   469 28 285 42 5 829 
 
      Share-based   Number of 
  Salary/Fees Benefits Bonus Pension payment Total outstanding 
Non-Executive Directors  £’000 £’000 £’000 £’000 £’000 £‘000 options
F Beechinor-Collins  35 – – – – 35
R Kellett-Clarke  30 – – – – 30
S J Barrett  30 – – – – 30
   95 – – – – 95
Director interests
The respective interests, all of which are beneficial, in the shares of the Company for the members of the Board at the year end are stated below:
       No of shares held % Holding
I Taylor       39,276,667 13.69
S Bird       31,276,667 10.90
P Simmonds*       7,073,841 2.46
M Patel       1,048,530 0.37
S J Barratt        377,500 0.13
R Kellett-Clarke       320,000 0.11
F Beechinor-Collins**       299,194 0.10
        79,672,399 27.76
* 2.11% of Peter Simmonds’ holdings/voting rights has been held by Frank Nominees Limited who acts as the nominee for Alliance Trust Pensions 
Limited, which is the trustee of a SIPP established by Peter Anthony Simmonds. Frank Nominees is the vehicle used by Kleinwort Benson Limited to 
hold securities for clients, trusts, SIPPs etc. The beneficiary of the SIPP is Peter Anthony Simmonds.
** The 299,194 shares shown as being held by Mr Beechinor-Collins are owned by Curra Trust, a trust established for the benefit of his children and 
which he has no beneficial interest.
Directors’ interest in share options
Under the Group’ s executive share option scheme the following Directors have the right to acquire ordinary shares. 
     No. share options  Option price Date first Expiry 
Executive Director    Grant date granted (pence) exercisable date
         
  
M Patel    13/10/2011 400,000 7.25 01/05/2013 01/02/2016
     15/10/2013 1,027,397 18.25 01/11/2015 31/10/2018 dotdigital Group Plc
Annual Report 2014/2015
34
The Directors present their report with the 
financial statements of the Company and 
the Group for the year ended 30 June 2015. 
Information relating to principal activity, review  
of business key performance indicators, 
research and development activities and future 
outlook is included within the strategic report.
Principal activity
The principal activity of the Group in the year 
under review was that of providing intuitive 
software as a service (“SaaS”) and managed 
services to digital marketing professionals. 
Review of business
During the year the Group has shown significant 
growth from continuing operations in customer 
numbers, sales, and profits. Revenues grew from 
£16.2m in the year ended June 2014 to £21.4m 
for the year ended June 2015, an increase of 32%. 
Pre-tax profits grew from £3.6m in 12 months 
to June 2014 to £5.2m for the year ended June 
2015, an increase of 44%.
Key performance indicators
The operations as a whole and the individual 
business units are managed and controlled 
using a variety of key performance indicators 
appropriate to the goals they have been set. 
Examples of key performance indicators from 
the Group are:
 
   2015 2014 % 
 (£m)  (£m)  Increase
Revenue 21.4 16.2 32%
EBITDA 6.8 4.7 45%
Volume of sends 5.760 3.700 56%
Dividends
The Board propose a dividend payment of 
£1.041,000 which equates to 0.36p per ordinary 
share (2014: £566,000 0.2p per ordinary share) 
to be distributed to shareholders in respect to 
the Group’ s reported performance. The Board’ s 
dividend policy will be reviewed annually in line 
with ensuring there is adequate cash within the 
business to maintain high growth strategy. 
Report of  
the Directors
The Directors who served during the period and their beneficial interests in the shares of the Group 
as recorded in the Register of Directors’ interests at 30 June 2015 are as follows: 
 30.6.15 30.6.14
   Percentage  Percentage 
  Number of shareholding Number of shareholding 
Directors  shares held % shares held %
I T aylor  39,276,667 13.69 40,267,667 14.24
S Bird  31,276,667 10.90 32,267,667 11.41
P Simmonds   7,073,841* 2.46 9,573,841* 3.39
M Patel  1,048,530 0.37 382,078 0.14
S J Barratt  377,500 0.13  215,000 0.08
R Kellett-Clarke  320,000  0.11  –  –
F Beechinor-Collins  299,194** 0.10  229,194** 0.11
 
*Frank Nominees Limited holds 2.11% in respect of Peter Simmonds holding/voting rights act  
as nominee for Trust Alliance Pensions Limited. Frank Nominees is a vehicle used by Kleinwort 
Benson Limited to hold securities for clients, trusts, SIPPs etc. The beneficiary of the SIPP is  
Peter Anthony Simmonds.
** The 299,194 shares shown as being held by Mr Beechinor-Collins are owned by Curra Trust,  
a trust established for the benefit of his children and in which he has no beneficial interest.
The Directors who served during the period and their beneficial interests in share options  
in the Group, as recorded in the register of Directors’ interests as at 30 June 2015 are  
as follows:-
    30.6.15 30.6.14 
    Number of  Number of 
Executive Directors    options held options held
M Patel    1,427,397 2,087,397
Substantial interests
On 06 October 2015, the following parties had notified the Group of a beneficial interest that 
represents 3% or more of the Group’ s issued share capital at that date:
     Percentage 
    Number of Shareholding 
Shareholder    shares held %
I T aylor    39,276,667 13.56
S Bird    31,276,667 10.80
Lion Trust Asset Management    26,969,801 9.31
JO Hambro Capital Management    14,500,050 5.00
Slater Investments Ltd    14,226,970 4.91
Investec Asset Management    12,559,388 4.34
Franklin T empleton    9,200,000 3.18
 
Governance dotdigital Group Plc
Annual Report 2014/2015
35
• Prepare the financial statements on 
the going concern basis unless it is 
inappropriate to presume that the 
Company will continue in business. 
The Directors are responsible for keeping 
adequate accounting records that are sufficient 
to show and explain the Company’ s and 
the Group’ s transactions and disclose with 
reasonable accuracy at any time the financial 
position of the Company and the Group 
and enable them to ensure that the financial 
statements comply with the Companies 
Act 2006. They are also responsible for 
safeguarding the assets of the Company and 
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 Company’ s 
website. Legislation in the United Kingdom 
governing the preparation and dissemination of 
financial statements may differ from legislation in 
other jurisdictions.
Statement as to disclosure of information 
to auditors
So far as the Directors are aware, there is 
no relevant audit information (as defined by 
Section 418 of the Companies Act 2006) of 
which the Group’ s auditors are unaware, and 
each Director has taken all the steps that he or 
she ought to have taken as a Director in order 
to make himself aware of any relevant audit 
information and to establish that the Group’ s 
auditors are aware of that information. 
Auditors
The auditors, Jeffreys Henry LLP , will be 
proposed for re-appointment at the forthcoming 
Annual General Meeting.
On behalf of the Board
Milan Patel
Company Secretary
12 October 2015
Future outlook
The Group provides email and cross-channel 
marketing technology and services. Each 
of these areas has shown market growth 
significantly above that of the UK economy. 
The Board believes that our widespread brand 
recognition and strong product will continue to 
present opportunities to expand and diversify 
profitability in the coming year.
Directors
The Directors shown below have held office 
during the whole of the period from 1 July 2014 
to the date of this report:
S Bird
P A Simmonds
I T aylor
R Kellett-Clarke
F Beechinor-Collins
S J Barratt
M Patel
Acquisition of the Company’s own shares
Further to the shareholder resolution of  
16 December 2014, the Company purchased 
660,000 ordinary shares with a nominal value 
of 0.5 pence, and representing 0.23% of the 
Company’ s called up ordinary shares capital, for 
a consideration of £212,984. The reason for the 
purchase was to reduce surplus cash balances 
and enhance earnings per share.
Indemnity of officers
The Group purchases Directors and officers 
insurance against their costs in defending 
themselves in legal proceedings taken 
against them in that capacity, and in respect 
of damages resulting from the unsuccessful 
defence of any proceedings.
Financial instruments
Details of the Group’ s risk management 
objectives and policies together with its 
exposure to financial risk are set out in  
Note 22 to the financial statements.
The purpose of the policies is to ensure that 
adequate cost-effective funding is available  
to the Group and exposure to financial  
risk – interest rate, liquidity and credit risk – 
is minimised.
Product development
In the markets in which the Group operates, 
effective development is vital to maintaining 
competitive advantage and securing future 
income streams.
Going concern
After making appropriate enquiries, the  
Directors consider that the Company and  
the Group have adequate resources to  
continue in operational existence for the 
foreseeable future. For this reason they  
continue to adopt the going concern basis 
preparing the financial statements.
Events after the reporting period
There are no events after the date of this  
report or the date the financial statements  
were approved by the Board of Directors  
which impact on the figures as presented.
Listing
The Group’ s ordinary shares have been traded 
on London Alternative Investment Market (AIM) 
since 29 March 2011. N+1 Singer are the 
Group’ s nominated advisors and together with 
Finncap are the joint brokers. The closing mid 
market share price at 30 June 2015 was 34.25p 
(2014: 33.12p).
Statement of Directors’ responsibilities
The Directors are responsible for preparing 
the Report of the Directors 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 International Financial Reporting Standards 
as adopted by the European Union. Under 
company law the Directors must not approve 
the financial statements unless they are satisfied 
that they give a true and fair view of the state of 
affairs of the Company and 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 judgements and accounting 
estimates that are reasonable and 
prudent; 
• State whether the Group and parent 
Company financial statements have been 
prepared in accordance with IFRSs as 
adopted by the European Union subject 
to any material departures disclosed and 
explained in the financial statements.  dotdigital Group Plc
Annual Report 2014/2015
36
Scope of the audit of the financial 
statements 
An audit involves obtaining evidence about 
the amounts and disclosures in the financial 
statements sufficient to give reasonable 
assurance that the financial statements are 
free from material misstatement, whether 
caused by fraud or error. This includes an 
assessment of: whether the accounting policies 
are appropriate to the Group’ s and the Parent 
company’ s circumstances and have been 
consistently applied and adequately disclosed; 
the reasonableness of significant accounting 
estimates made by the Directors; and the 
presentation of the financial statements. In 
addition, we read all the financial and non-
financial information in the Chairman’ s and 
Chief Executive’ s report, Corporate Social 
Responsibility report, Corporate Governance 
report, Audit Committee report, Remuneration 
Committee report and Directors’ report to 
identify material inconsistencies with the  
audited financial statements and to identify  
any information that is apparently materially 
incorrect based on, or materially inconsistent 
with, the knowledge acquired by us in the 
course of performing the audit. If we become 
aware of any apparent material misstatements 
or inconsistencies we consider the implications  
for our report. 
Opinion on financial statements 
In our opinion the financial statements: 
• Give a true and fair view of the state of the 
Group’s and the Parent company’s affairs 
as at 30 June 2015 and of the Group’s 
profit and Group’s and Parent company’s 
cash flow for the year then ended; 
• Have been properly prepared in 
accordance with IFRSs as adopted by  
the European Union; 
• The parent company financial statements 
have been properly prepared in 
accordance with IFRSs as adopted by 
the European Union and as applies in 
accordance with the provisions of the 
Companies Act 2006; and 
We have audited the financial statements of 
dotdigital Group Plc for the year ended 30 
June 2015, which comprise the consolidated 
income statement, consolidated statement of 
comprehensive income, consolidated statement 
of changes of equity, company statement of 
changes in equity, consolidated statement 
of financial position, company statement of 
financial position, consolidated statement of 
cash flows, company statement of cash flows 
and the related notes. The financial reporting 
framework that has been applied in their 
preparation is applicable law and International 
Financial Reporting Standards (IFRSs) as 
adopted by the European Union, and as regards 
the parent company financial statements, as 
applied in accordance with the provisions of 
the Companies Act 2006. 
This report is made solely to the company’ s 
members, as a body, in accordance with 
Chapter 3 of Part 16 of the Companies Act 
2006. Our audit work has been undertaken so 
that we might state to the company’ s members 
those matters we are required to state to them 
in an auditor’ s report and for no other purpose. 
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 
As explained more fully in the Statement of 
Directors’ Responsibilities, the Directors are 
responsible for the preparation of the financial 
statements and for being satisfied that they 
give a true and fair view. Our responsibility is to 
audit the financial statements in accordance 
with applicable law and International Standards 
on Auditing (UK and Ireland). Those standards 
require us to comply with the Auditing Practices 
Board’ s Ethical Standards for Auditors. 
• The financial statements have been 
prepared in accordance with the 
requirements of the Companies  
Act 2006. 
Opinion on other matter prescribed  
by the Companies Act 2006 
In our opinion the information given in the  
Report of the Directors and Strategic report 
for the financial year for which the financial 
statements are prepared is consistent with  
the financial statements. 
Matters on which we are required  
to report by exception 
We have nothing to report in respect of  
the following matters where the Companies  
Act 2006 requires us to report to you if,  
in our opinion: 
• Adequate accounting records have not 
been kept by the parent company, or 
returns adequate for our audit have not 
been received from branches not visited 
by us; or 
• The parent company financial statements 
are not in agreement with the accounting 
records and returns; or 
• Certain disclosures of Directors’ 
remuneration specified by law are  
not made; or 
• We have not received all the information 
and explanations we require for our audit. 
Jonathan Isaacs
Senior Statutory Auditor
For and on behalf of 
Jeffreys Henry LLP (Statutory Auditors)
Finsgate 5-7 Cranwood Street
London EC1V 9EE
12 October 2015
Report of the  
independent auditor
Governance dotdigital Group Plc
Annual Report 2014/2015
37
Financial statements
  Contents
38 Consolidated income statement
38 Consolidated statement of comprehensive income
39 Consolidated statement of financial position
40 Company statement of financial position
41 Consolidated statement of changes in equity
42 Company statement of changes in equity
43 Consolidated statement of cash flows
43 Company statement of cash flows
44 Notes to the consolidated financial statements
68 Company information 
Financial 
statements dotdigital Group Plc
Annual Report 2014/2015
38
Consolidated income statement 
For the year ended 30 June 2015
Notes
30.6.15 
£’000
30.6.14 
£’000
Continuing operations
Revenue 3 21,366 16,213
Cost of sales (2,292) (1,533)
Gross profit 19,074 14,680
Administrative expenses 7 (13,858) (11,059)
Operating profit 5,216 3,621
Finance income 6 27 20
Profit before income tax 7 5,243 3,641
Income tax expense 8 (587) (181)
Profit for the year from continuing operations 4,656 3,460
Discontinued operations
Loss for the year from discontinued operations 4 – (41)
Profit for the year 4,656 3,419
Attributable to the owners of the parent:
Profit for the year from continuing operations 4 4,656 3,460
Loss for the year from discontinued operations – (41)
Profit for the year attributable to the owners of the parent 4,656 3,419
Earnings per share from continuing operations  
 (pence per share)
Basic 11 1.63 1.24
Diluted 11 1.61 1.19
Earnings per share from continuing and discontinued operations 
(pence per share)
Basic 11 1.63 1.22
Diluted 11 1.61 1.18
Consolidated statement of comprehensive income
For the year ended 30 June 2015
Notes
30.6.15
£’000
30.6.14
£’000
Profit for the year 4,656 3,419
Other comprehensive income 
Items that may be subsequently reclassified to profit and loss:
Exchange differences on translating foreign operations 3 (4)
Total comprehensive income attributable to:
Owners of the parent 4,659 3,415
Total comprehensive income for the year
Comprehensive income from continuing operations 4,659 3,456
Comprehensive income from discontinued operations – (41)
  dotdigital Group Plc
Annual Report 2014/2015
39
Financial statements
Consolidated statement of financial position
For the year ended 30 June 2014
Notes
30.6.15
£’000
30.6.14
£’000
Assets
Non-current assists
Goodwill 12 609 609
Intangible assets 13 3,444 2,991
Property, plant and machinery 14 1,097 827
5,150 4,427
Current assets
Trade and other receivables 16 5,328 3,662
Cash and cash equivalents 17 11,932 9,306
17,260 12,968
Total assets 22,410 17,395
Equity attributable to the owners of the parent
Called up share capital 18 1,435 1,414
Share premium 19 5,382 5,147
Reverse acquisition reserve 19 (4,695) (4,695)
Other reserves 19 (25) 82
Retranslation reserve 19 (3) (6)
Retained earnings 19 16,297 12,211
Total equity 18,391 14,153
Liabilities
Non-current liabilities
Deferred tax 23 383 58
Current liabilities
Trade and other payables 20 3,437 2,984
Current tax payable 199 200
3,636 3,184
Total liabilities 4,019 3,242
Total equity & liabilities 22,410 17,395
 
The financial statements were approved and authorised for issue by the Board of Directors on 12 October 2015 and were 
signed on its behalf by
Milan Patel
Director 
Company registration number: 06289659 (England and Wales) dotdigital Group Plc
Annual Report 2014/2015
40
Company statement of financial position
For the year ended 30 June 2015
Notes
30.6.15
£’000
30.6.14
£’000
Assets
Non-current assists
Investments 15 5,186 5,186
5,186 5,186
Current assets
Trade and other receivables 16 3,124 3,845
Cash and cash equivalents 17 166 109
3,290 3,954
Total assets 8,476 9,140
Equity attributable to the Owners of the parent
Called up share capital 18 1,435 1,414
Share premium 19 5,382 5,147
Other reserves 19 (25) 82
Retained earnings 19 1,534 2,423
Total equity 8,326 9,066
Liabilities
Current liabilities
Trade and other payables 20 150 74
150 74
Total liabilities 150 74
Total equity & liabilities 8,476 9,140
The financial statements were approved and authorised for issue by the Board of Directors on 12 October 2015 and were 
signed on its behalf by
Milan Patel
Director 
Company registration number: 06289659 (England and Wales) dotdigital Group Plc
Annual Report 2014/2015
41
Financial statements
Consolidated statement of changes in equity 
For the year ended 30 June 2015
Called up 
share capital 
£’000
Retained 
earnings 
£’000
Share premium 
£’000
Balance as at 1 July 2013 1,387 9,071 4,863
Issue of share capital 27 – 284
Dividends – (279) –
Share based payment – – –
Transactions with owners 27 (279) 284
Profit for the year – 3,419 –
Other comprehensive income – – –
Total comprehensive income – 3,419 –
Balance as at 30 June 2014 1,414 12,211 5,147
Issue of share capital 21 – 235
Share repurchase – – –
Dividends – (570) –
Share based payment – – –
Transactions with owners 21 (570) 235
Profit for the year – 4,656 –
Other comprehensive income – – –
Total comprehensive income – 4,656 –
Balance as at 30 June 2015 1,435 16,297 5,382
Retranslation 
reserve 
£’000
Reverse 
acquisition 
reserve 
£’000
Other 
reserves 
£’000
Total equity 
£’000
Balance as at 1 July 2013 (2) (4,695) 13 10,637
Issue of share capital – – – 311
Dividends – – – (279)
Share based payments – – 69 69
Transactions with owners – – 69 101
Profit for the year – – – 3,419
Other comprehensive income (4) – – (4)
Total comprehensive income (4) – – 3,415
Balance as at 30 June 2014 (6) (4,695) 82 14,153
Issue of share capital – – – 256
Share repurchase – – (213) (213)
Dividends – – – (570)
Share based payments – – 106 106
Transactions with owners – – (107) (421)
Profit for the year – – – 4,656
Other comprehensive income 3 – – 3
Total comprehensive income 3 – – 4,659
Balance as at 30 June 2015 (3) (4,695) (25) 18,391
• Share capital is the amount subscribed for shares at nominal value.
• Retained earnings represents the cumulative earnings of the Group attributable to equity shareholders.
• Share premium represents the excess of the amount subscribed for share capital over the nominal value  
of the net share issue expenses. 
• Retranslation reserve relates to the retranslation of a foreign subsidiary into the functional currency of the Group.
• The reverse acquisition reserve relates to the adjustment required to account the reverse acquisition in accordance 
with International Financial Reporting Standards.
• Other reserves relate to the charge for the share based payment in accordance with International Financial 
Reporting Standard 2 and shares repurchased in the year classified as treasury shares.  dotdigital Group Plc
Annual Report 2014/2015
42
Company statement of changes in equity 
For the year ended 30 June 2015
Called up  
share capital 
£’000
Retained 
earnings 
£’000
Share  
premium 
£’000
Balance as at 1 July 2013 1,387 3,065 4,863
Issue of share capital 27 – 284
Dividends – (279) –
Share based payment – – –
Transactions with owners 27 (279) 284
Loss for the year – (363) –
Total comprehensive income – (363) –
Balance as at 30 June 2014 1,414 2,423 5,147
Issue of share capital 21 – 235
Share repurchase – – –
Dividends – (570) –
Share based payment – – –
Transactions with owners 21 (570) 235
Loss for the year – (319) –
Total comprehensive income – (319) –
Balance as at 30 June 2015 1,435 1,534 5,382
Other 
reserves 
£’000
Total  
equity 
£’000
Balance as at 1 July 2013 13 9,328
Issue of share capital – 311
Dividends – (279)
Share based payments 69 69
Transactions with owners 69 101
Loss for the year – (363)
Total comprehensive income – (363)
Balance as at 30 June 2014 82 9,066
Issue of share capital – 256
Share repurchase (213) (213)
Dividends – (570)
Share based payments 106 106
Transactions with owners (107) (421)
Loss for the year – (319)
Total comprehensive income – (319)
Balance as at 30 June 2015 (25) 8,326
• Share capital is the amount subscribed for shares at nominal value.
• Retained earnings represents the cumulative earnings of the Group attributable to equity shareholders.
• Share premium represents the excess of the amount subscribed for share capital over the nominal value  
of the net share issue expenses. 
• Retranslation reserve relates to the retranslation of a foreign subsidiary into the functional currency  
of the Group.
• Other reserves relate to the charge for the share based payment in accordance with International Financial 
Reporting Standard 2 and shares repurchased in the year classified as treasury shares. dotdigital Group Plc
Annual Report 2014/2015
43
Financial statements
Consolidated statement of cash flows
For the year ended 30 June 2015
Notes
30.6.15 
£’000
30.6.14 
£’000
Cash flows from operating activities
Cash generated from operations 28 5,667 5,297
Tax paid (263) (100)
Net cash generated from operating activities 5,404 5,197
Cash flows from investing activities
Purchase of intangible fixed assets (1,612) (1,408)
Purchase of tangible fixed assets (667) (607)
Sale of tangible fixed assets 1 –
Interest received 27 20
Net cash flows used in investing activities (2,251) (1,995)
Cash flows from financing activities
Equity dividends paid (570) (279)
Share issue 256 311
Share repurchase (213) –
Net cash flows (used)/from financing activities (527) 32
Increase in cash and cash equivalents 2,626 3,234
Cash and cash equivalents at beginning of year 29 9,306 6,072
Cash and cash equivalents at end of year 29 11,932 9,306
Increase in cash and cash equivalents from continuing operations 2,626 3,268
Increase in cash and cash equivalents from discontinuing operations – (34)
Increase in cash and cash equivalents 2,626 3,234
The above does not include the effect of foreign exchange rate changes on cash and cash equivalents due  
to its immaterial nature.
Company statement of cash flows
For the year ended 30 June 2015
Notes
30.6.15 
£’000
30.6.14 
£’000
Cash flows from operating activities
Cash generated from operations 28 584 7
584 7
Net cash generated from operating activities
Cash flows from financing activities
Equity dividends paid (570) (279)
Share issue 256 311
Share repurchase (213) –
Net cash flows (used)/from financing activities (527) 32
Increase in cash and cash equivalents 57 39
Cash and cash equivalents at beginning of year 29 109 70
Cash and cash equivalents at end of year 29 166 109 dotdigital Group Plc
Annual Report 2014/2015
44
Notes to the consolidated financial statements 
For the year ended 30 June 2015
1. General information
dotdigital Group Plc (“dotdigital”) is a company incorporated in England and Wales and quoted on the AIM Market.  
The address of the registered office is disclosed on the inside back cover of the financial statements. The principal  
activity of the Group is described on page 34.
2. Accounting policies
Basis of preparation
These financial statements have been prepared in accordance with International Financial Reporting Standards as 
adopted by the European Union (IFRS’s as adopted by the EU) and those parts of Companies Act 2006 applicable to 
companies reporting under IFRS. The financial statements have been prepared under the historical cost convention. 
The Group has applied all accounting standards and interpretations issued by the International Accountancy Standards 
Board and International Accounting Interpretations Committee effective at the time of preparing the financial statements.
New and amended standards adopted by the Group
There are no IFRSs or IFRIC interpretations that are effective for the first time for the financial year beginning on or  
after 1 July 2014 that would be expected to have a material impact on the Group.
Standards, interpretations and amendments to published standards that are not yet effective
The following new standards, amendments to standards and interpretations have been issued, but are not effective  
for the financial year beginning 1 July 2014 and have not been early adopted:
Reference Title Summary
Application date  
of standard  
(Periods commencing 
on or after)
IFRS 14 Regulatory deferral accounts Aims to enhance the comparability of financial reporting by 
entities subject to rate-regulations
1 January 2016
IFRS 15 Revenue from contracts with customers Specifies how and when to recognise revenue from 
contracts as well as requiring more information and relevant 
disclosures.
1 January 2017
Amendments to IFRS 11 Joint arrangements On acquisitions of interest in joint operations 1 January 2016
Amendments to  
IAS 16 and IAS 41
IAS 16: Property plant and equipment  
and IAS 41: Agriculture
On Bearer plants 1 January 2016
Amendments to  
IAS 16 and IAS 38 
Intangible Assets Clarification of acceptable methods of depreciation and 
amortisation
1 January 2016
Amendments to IAS 27 Separate financial statements Equity method in separate financial statements 1 January 2016
Amendments to  
IFRS 10 and IAS 28
IFRS 10:Consolidated financial  
and IAS 28: Investments in Associates
Investment entities: Applying the consolidation exception 1 January 2016
Amendments to  
IFRS 10 and IAS 28
IFRS 10:Consolidated financial  
and IAS 28: Investments in Associates
Sale or contribution of assets between an investor and its 
associate or joint venture 
1 January 2016
Amendments to IAS 1 Presentation of Financial statements Disclosure initiative 1 January 2016
Improvements to IFRS 5 Non current assets held for sale and  
discontinued operations
Methods of disposal 1 January 2016
Improvements to IFRS 7 Financial instruments Disclosures on servicing contracts and interim financial 
statements
1 January 2016
Improvements to IAS 19 Employee benefits Determining the discount rates for post-employment 
obligations
1 January 2016
Improvements to IAS 34 Interim financial reporting Information disclosed elsewhere in the interim financial 
report
1 January 2016
IFRS 9 Financial instruments Requirements on the classification and measurement of 
financial assets and liabilities and includes an expected 
credit losses model which replaces the current incurred loss 
impairment model. Also includes the hedging amendment 
that was issued in 2013
1 January 2018
The Directors anticipate that the adoption of these Standards and Interpretations in future periods will have no material 
impact on the financial statements of the Group. The Group does not intend to apply any of these pronouncements early. dotdigital Group Plc
Annual Report 2014/2015
45
Financial statements
The financial statements are presented in sterling (£), 
rounded to the nearest thousand pound.
Basis of consolidation
In the period ended 2009 the Company acquired via a 
share for share exchange the entire issued share capital  
of dotmailer Limited, whose principle activity is that of  
web and email based marketing.
Under IFRS 3 ‘Business combinations’ the dotmailer 
Limited share exchange has been accounted for as 
a reverse acquisition. Although these consolidated 
financial statements have been issued in the name of 
the legal parent, the company it represents in substance 
is a continuation of the financial information of the legal 
subsidiary, dotmailer Limited. The following accounting 
treatment has been applied in respect of the reverse 
acquisition:
• The assets and liabilities of the legal subsidiary, 
dotmailer Limited are recognised and measured in 
the consolidated financial statements at their pre 
combination carrying amounts, without restatement  
to their fair value;
• The retained reserves recognised in the consolidated 
financial statements for the beginning of the prior 
period reflect the retained reserves of dotmailer 
Limited to 30 April 2008. However, in accordance with 
IFRS3 ‘Business combinations’ the equity structure 
appearing in the consolidated financial statements 
reflects the equity structure of the legal parent 
dotdigital Group Plc, including the equity instruments 
issued under the share exchange to effect the 
business combination;
• A reverse acquisition reserve has been created to 
enable the presentation of a consolidated balance 
sheet which combines the equity structure of the  
legal parent with the non statutory reserves of the  
legal subsidiary;
• Comparative numbers are prepared on the  
same basis.
The following accounting treatment has been applied  
in respect of the acquisition of dotdigital Group Plc:
• The assets and liabilities of dotdigital are recognised 
and measured in the consolidated financial statements 
at their fair value at the date of acquisition.
• The cost of an acquisition is measured as the fair value 
of the assets given, equity instruments issued and 
liabilities incurred or assumed at the date of exchange, 
plus costs directly attributable to the acquisition. 
Identifiable assets acquired and liabilities assumed in 
a business combination are measured initially at their 
fair values at the date of acquisition, irrespective of the 
extent of any minority interest. The excess of the cost 
of acquisition over the fair value of the Group’s share 
of the identifiable net assets acquired is recorded as 
goodwill. If the cost of acquisition is less than the fair 
value of the net assets of the subsidiary acquired, 
the difference is recognised directly in the income 
statement.
Subsidiaries
A subsidiary is an entity whose operating and financing 
policies are controlled by the Group. Subsidiaries 
are consolidated from the date on which control was 
transferred to the Group. Subsidiaries cease to be 
consolidated from the date the Group no longer has 
control. Intercompany transactions, balances and 
unrealised gains on transactions between Group 
companies have been eliminated on consolidation.
As a result of applying reverse acquisition accounting 
since 30 January 2009, the consolidated IFRS financial 
information of dotdigital Group plc is a continuation of  
the financial information of dotmailer Limited.
Revenue recognition
Revenue comprises the fair value of the consideration 
received or receivable for the sale of goods and services 
in the ordinary course of the Group’s activities. Revenue 
is shown net of value added tax returns, rebates and 
discounts after eliminating sales within the Group.
The Group recognises revenue when the amount of 
revenue can be reliably measured and it is probable that 
the future economic benefits will flow to the entity. The 
Group bases it’s estimates on historical results, taking in to 
consideration the type of customer, the type of transaction 
and the specifics of each arrangement.
The Group sells web based marketing services to other 
businesses and services are either provided on a usage 
basis or fixed price bespoke contract. Revenue from 
contracts are recognised under percentage of completion 
method based on a percentage of services performed to 
date as a percentage of the total services to be performed.
Going concern
The Directors, at the time of approving the financial 
statements, a reasonable expectation that the Company 
and the Group have adequate resources to continue in 
operational existence for the foreseeable future. Thus they 
continue to adopt the going concern basis of accounting 
in preparing the financial statements. Further detail is 
contained in the Strategic report. dotdigital Group Plc
Annual Report 2014/2015
46
Operating profit
Operating profit is stated after charging operating expenses 
but before finance costs.
Dividends
Final dividend distributions to the Company’s shareholders 
are recognised as a liability in the financial statements 
in the period in which the dividends are approved by 
the Company’s shareholders while interim dividends 
distributions are recognised in the period in which the 
dividends are declared and paid.
Goodwill
Goodwill represents the excess of the fair value of the 
consideration over the fair values of the identifiable net 
tangible and intangible assets acquired.
Under IFRS 3 “Business Combinations” goodwill arising  
on acquisitions is not subject to amortisation but is  
subject to annual impairment testing. Any impairment  
is recognised immediately in the income statement and  
not subsequently reversed.
Investments in subsidiaries
Investments are held as non-current assets at cost less any 
provision for impairment. Where the recoverable amount of 
the investment is less then the carrying amount, impairment 
is recognised.
Intangible assets
Intangible assets are recorded as separately identifiable 
assets and recognised at historical cost less any 
accumulated amortisation. These assets are amortised 
over their useful economic lives of 4-5 years, with the 
charge included in administrative expenses in the income 
statement.
Intangible assets are reviewed for impairment annually. 
Impairment is measured by determining the recoverable 
amount of an asset or cash generating unit (CGU) which 
is the greater of its value in use and its fair value less costs 
to sell. In assessing value in use, the estimated future cash 
flows are discounted to their present value using a pre-tax 
discount rate that reflects current market assessments of 
the time value of money and the risks specific to the asset 
or CGU. For the purpose of impairment testing, assets that 
cannot be tested individually are grouped together into the 
smallest Group of assets that generates cash inflows from 
continuing use that are largely independent of the cash 
inflows of other assets  
or CGU.
• Domain names
Acquired domain names are shown at historical cost. 
Domain names have a finite life and are carried at cost 
less accumulated amortisation. 
Amortisation is calculated using straight line method 
to allocate the cost of domain names over their useful 
lives of four years.
• Software
Acquired software and websites are shown at 
historical cost. They have a finite life and are carried 
at cost less accumulated amortisation. Amortisation 
is calculated using straight line method to allocate the 
cost of software and websites over their useful lives of 
four years.
• Product development
Product development expenditure is capitalised when 
it is considered that there is a commercially and viable 
technically product, the related expenditure is separable 
identifiable and there is a reasonable expectation 
that the related expenditure will be exceeded by 
future revenues. Following initial recognition, product 
developments are carried at cost less any accumulated 
amortisation and any accumulated impairment losses. 
The useful lives of these intangible assets are assessed 
to have a finite life of five years. Amortisation is charged 
on assets with finite lives and until economic benefit can 
be received and recognised, this expense is taken to 
the income statement and useful lives are reviewed on 
an annual basis. Amortisation is charged from the point 
when the assets is available for use.
Other development expenditures that do not meet 
these criteria are recognised as an expense as 
incurred. Development costs previously recognised 
as an expense are not recognised as an asset in a 
subsequent period. Capitalised development costs are 
recorded as intangible assets and amortised from the 
point at which they are ready for use on a straight line 
basis over its useful life.
Costs incurred on development projects (relating to 
the design and testing of new or improved products) 
are recognised as intangible assets when the following 
criteria are fulfilled:
• It is technically feasible to complete the intangible 
asset so that it will be available of use or resale
• Management intends to complete the intangible 
asset and use or sell it
• There is an ability to use or sell the intangible
• It can be demonstrated how the intangible asset  
will generate possible future economic benefits
• Adequate technical, financial and other resource  
to complete the development and to use or sell the 
intangible asset are available and
• The expenditure attributable to the intangible asset 
during its development can be reliably measured.
Notes to the consolidated financial statements continued
For the year ended 30 June 2015 dotdigital Group Plc
Annual Report 2014/2015
47
Financial statements
• Impairment of non financial assets  
(excluding goodwill)
At each balance sheet date, the Group reviews the 
carrying amounts of its tangible and intangible assets 
to determine whether there is any indication that 
those assets have suffered an impairment loss. If any 
such indication exists, the recoverable amount of the 
asset is estimated in order to determine the extent 
of the impairment loss (if any). Where the asset does 
not generate cash flows that are independent from 
other assets, the Group estimates the recoverable 
amount of the cash-generating unit to which the asset 
belongs. An intangible asset with an indefinite useful 
life is tested for impairment annually and whenever 
there is an indication that the asset may be impaired.
Property, plant and equipment
Tangible non current assets are stated at historical  
cost less accumulated depreciation. Historical cost includes 
expenditure that is directly attributable to  
the acquisition of the items.
Subsequent costs are included in the assets carrying 
amount or recognised as a separate asset, as appropriate, 
only when it is probable that future economic benefits 
are associated with the item will flow to the Company 
and the cost of the item can be measured reliably. The 
carrying amount of the replaced part is derecognised. All 
other repairs and maintenance are charged to the income 
statement during the financial period in which they are 
incurred. Depreciation is provided at the following rates in 
order to write off each asset over its estimated useful life 
and are based on the cost of assets less residual value. 
Significant components of individual assets are assessed 
and if a component has a useful life that is different from 
the remainder of that asset, that component is depreciated 
separately.
Short leasehold: over the term of the lease
Fixtures and fittings: 25% on cost
Computer equipment: 25% on cost
The asset’s residual values and useful economic lives are 
reviewed and adjusted, if appropriate, at each reporting 
date. An asset’s carrying amount is written down 
immediately to its recoverable amount if the asset’s carrying 
amount is greater then its estimated recoverable value.
Gains and losses on disposals are determined by 
comparing the proceeds with the carrying amount  
and are recognised within other (losses) or gains in  
the income statement.
Capital risk management
The Group manages its capital to ensure it is able to 
continue as a going concern while maximising the return 
to stakeholders through the optimisation of the debt and 
equity balance. The capital structure of the Group consists of 
cash equivalents and equity attributable to the owners of the 
parent as disclosed in the Statement of Changes in Equity.
Taxation
The tax expense for the year comprises current and 
deferred tax. Tax is recognised in the Income Statement, 
extent to the extent that it relates to items recognised in 
other comprehensive income or directly in equity. In this 
case, the tax is also recognised in other comprehensive 
income for directly in equity, respectively.
Current tax
Current taxes are based on the results shown in the 
financial statements and are calculated according to local 
tax rules, using tax rates enacted or substantially enacted 
by the balance sheet date.
Deferred taxation
Deferred income tax is provided in full, using the liability 
method, on temporary differences arising between the tax 
bases of assets and liabilities and their carrying amounts in 
the financial statements.
Deferred income tax assets are recognised to the extent 
that it is probable that future taxable profit will be available 
against which the temporary difference will be utilised.
Deferred income tax is determined using tax rates that have 
been enacted or substantially enacted by the balance sheet 
date and are expected to apply when they related deferred 
income asset is realised or deferred income tax liability is 
settled.
Operating leases
Rent payable under operating leases is not recognised in 
the Group’s statement of financial position. Such costs are 
expensed on a straight line basis over the term of the lease. 
Lease incentives received are recognised as an integral part 
of the total expense, over the term of the lease.
Financial instruments
Financial assets and financial liabilities are recognised on 
the statement of financial position when an entity becomes 
a party to the contractual provisions of the instruments. 
Financial assets and financial liabilities are initially measured 
at fair value. Transaction costs that is directly attributable 
to the acquisition or issue of financial assets and financial 
liabilities (other than financial assets and financial liabilities 
at fair value through profit or loss) are added to or deducted 
from the fair value of the financial assets or financial 
liabilities, as appropriate, on initial recognition. Transaction 
costs directly attributable to the acquisition of financial 
assets or financial liabilities at fair value through profit or loss 
are recognised immediately in the income statement. dotdigital Group Plc
Annual Report 2014/2015
48
• Financial assets
The Group’s accounting policies for financial assets 
are set out below.
Management determine the classification of its 
financial assets at initial recognition depending on the 
purpose for which the financial assets were acquired 
and where allowed and appropriate, revaluate this 
designation at every reporting date.
All financial assets are recognised on a trade date 
when, and only when, the Group becomes a party 
to the contractual provisions of an instrument. When 
financial assets are recognised initially, they are 
measured at fair value plus transaction costs, except 
for those finance assets classified as at fair value 
through profit or loss (‘FVTPL’), which are initially 
measured at fair value.
Financial assets are classified into the following 
specified categories: financial assets at FVTPL,  
’held-to-maturity’ investments, ‘available for sale’ 
(AFS) financial assets and loans and receivables.  
The classification depends on the nature and purpose 
of the financial assets and is determined at the time  
of recognition.
Derecognition of financial assets occurs when the 
rights to receive cash flows from the investments 
expire or are transferred and substantially all of the 
risks and rewards of ownership have been transferred.
At each reporting date, financial assets are reviewed 
to assess whether there is objective evidence of 
impairment. If any such evidence exists, impairment 
loss is determined and recognised based on the 
classification of the financial asset.
Loans and receivables (including trade receivables, 
prepayments, deposits and other receivables, cash 
and bank balances) are non-derivative financial assets 
with fixed or determinable payments that are not 
quoted on an active market. At each reporting date 
subsequent to initial recognition, loans and receivables 
are carried at amortised cost using the effective 
interest method, less any identified impairment losses. 
An impairment loss is recognised in the statement 
of comprehensive income when there is objective 
evidence that the asset is impaired, and is measured 
as the difference between the asset’s carrying amount 
and the present value of estimated future cashflows 
discounted at the original effective interest rate. 
Impairment losses are reversed in subsequent periods 
when an increase in the asset’s recoverable amount 
can be related objectively to an event occurring 
after the impairment was recognised, subject to a 
restriction that the carrying amount of the asset at 
the date the impairment is reversed does not exceed 
what the amortised cost would have been had the 
impairment not been recognised.
• Cash and cash equivalents
Cash and cash equivalents comprise cash at bank 
and on hand, demand deposits with banks and 
other financial institutions, and short-term, highly 
liquid investments that are readily convertible into 
known amounts of cash and which are subject to 
an insignificant risk of changes in value, having been 
within three months of maturity at acquisition. Bank 
overdrafts that are repayable on demand and form 
an integral part of the Group’s cash management 
are also included as a component of cash and cash 
equivalents for the purpose of the consolidated 
statement of cash flows.
• Trade receivables
Trade receivables are recognised initially at the 
lower of their original invoiced value and recoverable 
amount. A provision is made when it is likely that 
the balance will not be recovered in full. Terms on 
receivables range from 30 to 90 days.
• Financial liabilities and equity
Financial liabilities and equity are recognised on the 
Group’s statement of financial position when the 
Group becomes a party to a contractual provision 
of an instrument. Financial liabilities and equity 
instruments issued by the Group are classified 
according to the substance of the contractual 
arrangements entered into and the definitions of a 
financial liability and an equity instrument. An equity 
instrument is any contract that evidences a residual 
interest in the assets of the Group after deducting  
all of its liabilities. Equity instruments issued by the 
Group are recognised at the proceeds received, net  
of transaction costs.
The Group’s financial liabilities include trade payables 
and accrued liabilities.
• Trade payables
Trade payables are recognised initially at fair value and 
subsequently measured at amortised cost using the 
effective interest method. Terms on accounts payables 
range from 10 to 90 days.
Foreign currency risk
Currency risk is the risk that the holding of foreign 
currencies will affect the Group’s position as a result  
of a change in foreign currency exchange rates.  
The Group has no significant foreign currency risk  
as most of the Group’s financial assets and liabilities  
are denominated in functional currencies of relevant  
group entities. Accordingly, no quantitative market  
risk disclosures or sensitivity analysis for currency  
risk have been prepared.
Notes to the consolidated financial statements continued
For the year ended 30 June 2015 dotdigital Group Plc
Annual Report 2014/2015
49
Financial statements
The results and financial position of all the group entities 
(none of which has the currency of a hyper-inflationary 
economy) that have a functional currency different from the 
presentation currency are translated into the presentation 
currency as follows:
(a)  Assets and liabilities for each balance sheet presented 
are translated at the closing rate at the date of that 
balance sheet;
(b)  Income and expenses for each income statement  
are translated at average exchange rates (unless  
this average is not a reasonable approximation  
of the cumulative effect of the rates prevailing on  
the transaction dates, in which case income and 
expenses are translated at the rate on the dates of  
the transactions); and
(c)  All resulting exchange differences are recognised  
in other comprehensive income.
Equity
Share capital is the amount subscribed for shares  
at their nominal value.
Share premium represents the excess of the amount 
subscribed for the share capital over the nominal value  
of the respective shares net of share issue expenses.
Retained earnings represent the cumulative earnings  
of the Group attributable to equity Shareholders.
The reverse acquisition reserve relates to the adjustment 
required by accounting for the reverse acquisition in 
accordance with IFRS3 ‘Business combinations’.
Other reserves relate to the charge for share based 
payments in accordance with IFRS2 ‘Share based 
payments’.
Share based payments
For equity settled share based payment transactions 
the Group, in accordance with IFRS 2 “Share Based 
Payments” measures their value, and the corresponding 
increase in equity, indirectly, by reference to the fair value 
of the equity instruments granted. The fair value of those 
equity instruments is measured at the grant date using the 
trinomial method. The expense is apportioned over the 
vesting period of the financial instrument and is based on 
the number which is expected to vest and the fair value of 
those financial instruments at the date of grant. If the equity 
instruments granted vested immediately, the expense is 
recognised in full.
Functional currency translation
• Functional and presentation currency
Items included in the financial statements of the 
company are measured using the currency of the 
primary economic environment in which the entity 
operates (functional currency), which is mainly pounds 
sterling (£) and it this currency the financial statements 
are presented in.
• Transaction and balances
Foreign currency transactions are translated in to the 
functional currency using exchange rates prevailing 
at the dates of the transactions. Foreign exchange 
gains and losses resulting from the settlement of 
such transactions and from the translation at the year 
end exchange rates of monetary assets and liabilities 
denominated in foreign currencies are recognised in 
the income statement.
Employee benefit costs
The Group operates a defined contribution pension 
scheme. Contributions payable by the Group’s pension 
scheme are charged to the income statement in the period 
in which they relate.
Segment reporting
Operating segments are reported in a manner consistent 
with the internal reporting provide to the chief operating 
decision-maker. The chief operating decision maker who 
is responsible for allocating resources and assessing 
performance of the operating segments as identified by the 
Board of Directors.
Critical accounting adjustments
The Group makes certain estimates and assumptions 
regarding the future. Estimates and judgements are 
continually evaluated based on historical experience 
and other factors, including expectations of future 
events that are believed to be reasonable under the 
circumstances. In the future, actual experience may differ 
from these estimates and assumptions. The estimates 
and assumptions that have a significant risk of causing a 
material adjustment to the carrying amounts of assets and 
liabilities within the next financial year are discussed below:
Judgements
(a) Capitalisation of development costs
Our business model is underpinned by our email 
and cross-channel marketing automation platform, 
dotmailer. Internal activities are continually undertaken 
to enhance and maintain the product in a bid to stay 
ahead of our competition. Management review the 
work of developers during the period and make the 
following judgements: dotdigital Group Plc
Annual Report 2014/2015
50
• Internal work relating to product development 
is reviewed against IAS 38 criteria and will be 
capitalised if management feel the criteria have 
been met.
• Internal work relating to the maintenance of 
existing products is expensed to the income 
statement and accounted for in payroll costs.
Estimates and assumptions
(a) Impairment testing of goodwill
The Directors have carried out a detailed impairment 
review in respect of goodwill. The Group assesses 
at each reporting date whether there is an indication 
that an asset may be impaired, by considering the 
net present value of discounted cash flows forecasts 
which have been discounted using a pre-tax discount 
rate of 10%. The cash flow projections are based on 
the assumption that the Group can realise projected 
sales. A prudent approach has been applied with no 
residual value being factored.
Further details on the estimates and assumptions we 
make in our annual impairment testing of goodwill are 
included in Note 12 to the Financial Statements. At the 
period end, based on these assumptions there was no 
indication of impairing to carrying value of goodwill.
(b) Share-based compensation
Key management believe that there will not be only 
one acceptable choice for estimating the fair value  
of share-based payment arrangements. The 
judgements and estimates that management apply  
in determination of the share-based compensation  
are summarised below:
•  Selection of a valuation model
•  Making assumptions used in determining  
the variables used in a valuation model
i. expected life,
ii. expected volatility,
iii. expected dividend yield,
iv. interest rate
Further detail on the estimates and assumptions we make 
in our share-based compensation are included in Note 27 
to the Financial Statements. The charge made to income 
statement for period is also disclosed here.
(c) Depreciation and amortisation
The Group depreciates short leasehold, fixtures and 
fittings, computer equipment and amortises computer 
software, internally generated development costs 
and domain names on a straight line method over 
the estimated useful lives. The estimated useful lives 
reflect the directors’ estimate of the periods that  
the Group intends to derive future economic benefits 
from the use of the Group’s short leasehold fixtures 
and fittings, computer equipment, computer  
software, internally generated development costs  
and domain names.
(d) Bad debt provision
We perform ongoing credit evaluations of our 
customers and grant credit based upon past 
payment history, financial condition and anticipated 
industry conditions. Customer payments are regularly 
monitored and a provision for doubtful accounts  
is established based upon specific situations and 
overall industry conditions. Hence the provision 
is maintained for potential credit losses based 
upon management’s assessment of the expected 
collectability of all accounts receivable. In making this 
assessment, management takes into consideration  
(i) an circumstances of which we are aware regarding 
a customer’s inability to meet its financial obligations 
and (ii) our judgements as to potential prevailing 
economic conditions in the industry and their potential 
impact on the Group’s customers.
Notes to the consolidated financial statements continued
For the year ended 30 June 2015 dotdigital Group Plc
Annual Report 2014/2015
51
Financial statements
3. Segmental reporting
The Group’s single line of business is the provision of web based marketing services. Last year more than 90% of the 
Group’s revenue arose in the UK and all of the Group’s non-current assets were held there. This year the chief operating 
decision maker considers the Group’s only reportable segment to be by geographical location this being UK and rest of 
the world (“RoW”) operations as shown below:
30.6.2015
UK Operations 
£’000
RoW  
Operations 
£’000
Total  
£’000
Income statement
Revenue 18,274 3,092 21,366
Gross profit 16,676 2,398 19,074
Profit before income tax 3,476 1,767 5,243
Total comprehensive income attributable to the  
owners of the parent
2,895 1,764 4,659
Financial position
Total assets 21,591 819 22,410
Net current assets 12,964 660 13,624
Revenue from external customers are attributed to the geographical segments noted above based on the customers 
location. There was no customers who account for more than 10% of revenue (2014: None)
30.6.2014
UK Operations 
£’000
RoW  
Operations 
£’000
Total  
£’000
Income statement
Revenue 14,647 1,566 16,213
Gross profit 13,267 1,413 14,680
Profit before income tax 2,430 1,211 3,641
Total comprehensive income attributable to the  
owners of the parent
2,205 1,210 3,415
Financial position
Total assets 17,002 393 17,395
Net current assets 10,030 (246) 9,784
4. Discontinued operations
Discontinued operations refers to the closure of the service division.
Analysis of continuing and discontinued operations is as follows:
Year ended 30 June 2015
Continuing 
operations 
30.6.15 
£’000
Discontinued 
operations 
30.6.15 
£’000
Revenue 21,366 –
Cost of sales (2,292) –
Gross profit 19,074 –
Administrative expenses (13,858) –
Operating profit before exceptional items 5,216 –
Finance income 27 –
Income tax (587) –
Profit for the year attributable to owners of the parent 4,656 – dotdigital Group Plc
Annual Report 2014/2015
52
Year ended 30 June 2014
Continuing 
operations 
30.6.14 
£’000
Discontinued 
Operations 
30.6.14 
£’000
Revenue 16,213 199
Cost of sales (1,533) (122)
Gross profit 14,680 77
Administrative expenses (11,059) (118)
Operating profit/(loss) before exceptional items 3,621 (41)
Finance income including exceptional items 20 –
Income tax (181) –
Profit/(loss) for the year attributable to owners of the parent 3,460 (41)
5. Employees and directors
30.6.15 
£’000
30.6.14 
£’000
Wages and salaries 7,711 6,024
Social security costs 871 679
Other pension costs 221 147
8,803 6,850
The average monthly number of employees during the year are as follows
30.6.15 30.6.14
Directors 7 7
Sales and Marketing 84 80
SEO and Product Developers 48 41
Administration 47 44
186 172
Remuneration of key management personal is included in Note 25
During the year the Group also capitalised staff related costs of £1,549,066 (2014 – £1,232,341) in relation to internally 
generated development costs.
6. Net finance income  
30.6.15 
£’000
30.6.14 
£’000
Finance income:
Deposit account interest 27 20
27 20
7. Operating profit before exceptional items
Costs by nature  
Profit from continuing operations has been arrived after charging/(crediting):-
30.6.15 
£’000
30.6.14 
£’000
Direct marketing 1,516 1,033
Outsourcing 415 471
Other costs 361 29
Total cost of sales 2,292 1,533
Notes to the consolidated financial statements continued
For the year ended 30 June 2015 dotdigital Group Plc
Annual Report 2014/2015
53
Financial statements
30.6.15
£’000
30.6.14
£’000
Staff related costs (inc Directors emoluments) –note 5 8,803 6,850
Operating leases: Land and buildings 834 586
Operating lease: Other 44 68
Audit remuneration 38 36
Amortisation of intangibles 1,159 866
Depreciation charge 397 251
Legal, professional and consultancy fees 417 480
Computer expenditure 828 584
Bad debts 103 302
Foreign exchange losses 61 67
Travelling 351 250
Office running 217 160
Other costs 606 559
Total administration costs 13,858 11,059
During the year the Group obtained the following services from the Group’s auditor at costs detailed below:
30.6.15
£’000
30.6.14
£’000
Fees payable to the Company’s auditor for the audit of Parent Company and  
consolidated financial statements
7 7
Fees payable to the Company’s auditor for other services
– The audit of Company subsidiaries 27 26
– Non audit fees: Tax and review of interim accounts 4 3
38 36
8. Income tax expense
Analysis of the tax charge from continuing operations:
30.6.15
£’000
30.6.14
£’000
Current tax on profits for the year 262 166
Deferred tax on origination and reversal of timing differences 325 44
587 210
Overprovision in previous periods – (29)
587 181
Tax charge from continuing operations 587 181
587 181
 
Factors affecting the tax charge:
30.6.15
£’000
30.6.14
£’000
Profit on ordinary activities before tax 5,243 3,600
Profit on ordinary activities multiplied by the standard rate of corporation tax in the  
UK of 20.75% (2014: 22.50%)
1,088 810
Effects of:
Expenses not deductible (250) 281
Research and development enhanced claim (747) (661)
Expenditure permitted on exercising options (238) (247)
Overseas tax (profits)/losses (43) 25
Capital allowances in excess of depreciation (48) (42)
Total income tax 262 166
Deferred tax was calculated using the rate 20% (2014: 20.75%). For further details on deferred tax please see Note 23. dotdigital Group Plc
Annual Report 2014/2015
54
9. Profit/(loss) of parent company
As permitted by Section 408 of the Companies Act 2006, the profit and loss account of the parent company is not 
presented as part of these financial statements. The parent company’s loss for the financial year was £318,852  
(2014: £363,022). 
Notes to the consolidated financial statements continued
For the year ended 30 June 2015
10. Dividends
Amounts recognised as distributions to equity holders in the period.
30.6.15 
£’000
30.6.14 
£’000
Final dividend for year end 30 June 2015 of 0.2p per share 570 279
Proposed dividend for the year end 30 June 2015 of 0.36p (2014: 0.2p) per share 1,041 566
The proposed final dividend is subject to approval by the shareholders at the Annual General Meeting and has not been 
included as a liability in these financial statements.
11. Earnings per share
Earnings per share data is based on the consolidated profit using and the weighted average number of shares in issue of 
the parent company. Basic earnings per share are calculated by dividing the earnings attributable to ordinary shareholders 
by the weighted average number of ordinary shares outstanding during the period.
Diluted earnings per share is calculated using the weighted average number of shares adjusted to assume the conversion 
of all dilutive potential ordinary shares.
Reconciliations are as follows:-
30.6.15 
 
 
From continuing operations
Earnings 
£’000
Weighted 
average 
number of 
shares
Per share 
Amount 
Pence
Basic EPS
Profit for the year attributable to the owners of the parent 4,656 284,804,914 1.63
Options and Warrants – 5,001,766 –
Diluted EPS
Profit for the year attributable to the owners of the parent 4,656 289,806,680 1.61
From continuing operations
30.6.15 
£’000
30.6.14 
£’000
Profit for the year attributable to the owners of the parent 4,656 3,419
Adjustments to exclude profit/(loss) from discontinued operations – 41
Profit for the year from continuing operations for the purpose of basic  
of basic earnings per share excluding discontinued operations
4,656 3,460
From discontinued operations
30.6.15 
Per share (p)
30.6.14 
Per share (p)
Basic EPS – (0.02)
Diluted EPS – (0.01)
There was no difference in the weighted average number of shares used in the calculation of basic and diluted earnings  
per share as the effect of all notionally dilutive shares outstanding were anti-dilutive.
Weighted average number of shares
2015 
 Shares
2014 
Shares
Basic EPS 284,804,914 279,107,898
Diluted EPS 289,806,680 290,380,434
The denominators and numerators used are the same those detailed above for both basic and diluted earnings per share 
from continuing and discontinued operations. dotdigital Group Plc
Annual Report 2014/2015
55
Financial statements
 
 
 
From continuing and discontinued operations
30.6.14
Earnings 
£’000
Weighted 
average 
number of 
shares
Per share 
Amount 
Pence
Basic EPS
Profit for the year attributable to the owners of the parent 3,419 279,107,898 1.22
Options and Warrants – 11,272,536 –
Diluted EPS
Profit for the year attributable to the owners of the parent 3,419 290,380,434 1.18
30.6.14
 
 
From continuing operations
Earnings 
£’000
Weighted 
average 
number of 
shares
Per share 
Amount 
Pence
Basic EPS
Profit for the year attributable to the owners of the parent 3,460 279,107,898 1.24
Options and Warrants – 11,272,536 –
Diluted EPS
Profit for the year attributable to the owners of the parent 3,460 290,380,434 1.19
Adjusted earnings per share represents the performance of the company had the exceptional item listed above not 
occurred in the year and is only presented for guidance purposes. 
12. Goodwill
Group
 
Cost
30.6.15 
£’000
30.6.14 
£’000
At 1 July
And 30 June 4,121 4,121
Accumulated impairment loss
At 1 July and at 30 June 3,512 3,512
Net book value 609 609
Goodwill arising on business combinations is not amortised but is reviewed for impairment on an annual basis, or more 
frequently if there are indications that goodwill may be impaired. Goodwill acquired in a business combination is allocated, 
at acquisition, to cash generating units (CGU’s) that are expected to benefit from that business combination.
The carrying amount of goodwill relates wholly to the Group’s single trading activity and business segment.  
This has been tested for impairment during the current financial year by comparison with the recoverable amounts  
of the CGU.
Recoverable amounts for CGU’s are based on the higher of value in use and fair value less costs to sell.  
The recoverable amounts of the CGU have been determined from value in use calculations. These calculations use  
pre-tax cash flow projections based on financial budgets approved by management covering a five year period.  
The key assumptions for the value in use calculations are those regarding discount rates, growth rates, and expected 
changes in margins. Management estimate discount rates using pre-tax rates that reflect the current market assessment 
of the time value of money and the risks specific to the CGU’s. Changes in income and expenditure are based on past 
experience and expectations of the future changes in the market. The pre-tax discount rate used to calculate the value 
in use are 10% (2014 – 10%). The valuations indicate sufficient headroom such that a reasonably possible change in key 
assumptions would not result in impairment of goodwill. dotdigital Group Plc
Annual Report 2014/2015
56
13. Intangible assets
Group
Computer 
softwares 
£’000
Internally 
generated 
development 
costs 
£’000
Domain 
names 
£’000
Totals 
£’000
Cost
At 1 July 2014 274 5,013 16 5,303
Additions – 1,612 – 1,612
At 30 June 2015 274 6,625 16 6,915
Amortisation
At 1 July 2014 195 2,102 15 2,312
Amortisation for the year 33 1,125 1 1,159
At 30 June 2015 228 3,227 16 3,471
Net book value
At 30 June 2015 46 3,398 – 3,444
Computer 
softwares 
£’000
Internally 
generated 
development 
costs 
£’000
Domain 
names 
£’000
Totals 
£’000
Cost
At 1 July 2013 211 3,668 16 3,895
Additions 63 1,345 – 1,408
At 30 June 2014 274 5,013 16 5,303
Amortisation
At 1 July 2013 155 1,278 13 1,446
Amortisation for the year 40 824 2 866
At 30 June 2014 195 2,102 15 2,312
Net book value
At 30 June 2014 79 2,911 1 2,991
Development cost additions represents resources the Group have invested in the development of new innovative  
and ground breaking technology products for marketing professionals. This platform allows them to create, send  
and automate marketing campaigns. Following development of the products the group intends to licence the use  
of the platform.
14. Property, plant and equipment
Group
 
Short 
Leasehold 
£’000
Fixtures & 
fittings 
£’000
Computer  
equipment 
£’000
Totals 
£’000
Cost
At 1 July 2014 288 308 888 1,484
Additions 107 93 467 667
Disposals – – (1) (1)
At 30 June 2015 395 401 1,354 2,150
Depreciation
At 1 July 2014 47 112 498 657
Depreciation for the year 48 91 258 397
Eliminated on disposal – – (1) (1)
At 30 June 2015 95 203 755 1,053
Net book value
At 30 June 2015 300 198 599 1,097
Notes to the consolidated financial statements continued
For the year ended 30 June 2015 dotdigital Group Plc
Annual Report 2014/2015
57
Financial statements
Short  
Leasehold 
£’000
Fixtures & 
fittings 
£’000
Computer 
equipment 
£’000
  
Totals 
£’000
Cost
At 1 July 2013 107 155 620 882
Additions 181 154 272 607
Disposals – (1) (4) (5)
At 30 June 2014 288 308 888 1,484
Depreciation
At 1 July 2013 25 64 321 410
Depreciation for the year 22 49 180 251
Eliminated on disposal – (1) (3) (4)
At 30 June 2014 47 112 498 657
Net book value
At 30 June 2014 241 196 390 827
15. Investments
Company
Shares in 
Group 
undertakings 
30.6.15 
£’000
Shares in 
Group 
undertakings 
30.6.14 
£’000
Cost
At 1 July and 30 June 8,705 8,705
Amortisation
At 1 July and 30 June 3,519 3,519
Net book value
At 30 June 5,186 5,186
The Group or the company’s investments at the balance sheet date in the share capital of companies include  
the following: 
Subsidiaries Nature of business Class of share
Proportion of
voting power
held %:
dotmailer Limited Web and email based marketing Ordinary 100
Ordinay A 100
dotsurvey Limited Dormant Ordinary 100
dotsearch Europe Limited Branch company Ordinary 100
dotcommerce Limited Dormant Ordinary 100
doteditor Limited Dormant Ordinary 100
dotSEO Limited Dormant Ordinary 100
dotagency Limited Non-trading Ordinary  
B, C and D
100
dotmailer Inc Web and email based marketing Ordinary 100
All of the above subsidiaries have been included within the consolidated results. 
All the above companies with the exception of dotmailer Inc were incorporated in England and Wales. dotmailer Inc  
was incorporated in Delaware (US). dotdigital Group Plc
Annual Report 2014/2015
58
16. Trade and other receivables
Group Company
30.6.15 
£’000
30.6.14 
£’000
30.6.15 
£’000
30.6.14 
£’000
Current:
Trade receivables 4,589 3,119 – –
Less: Provision for impairment of trade receivables (343) (336) – –
Trade receivables – net 4,246 2,783 – –
Other receivables 39 35 – –
Amounts owed by Group undertakings – – 3,108 3,821
VAT – – 7 12
Prepayments 1,043 844 9 12
5,328 3,662 3,124 3,845
Further details on the above can be found in Note 22.
Included within prepayments is an amount of £121,998 (2014: £104,429) in relation to deferred commission which is 
considered to be long term.
17. Cash and cash equivalents
Group Company
30.6.15 
£’000
30.6.14 
£’000
30.6.15 
£’000
30.6.14 
£’000
Bank accounts 11,932 9,306 166 109
11,932 9,306 166 109
Further details on the above can be found in Note 22. 
18. Called up share capital
 
Allotted, issued, fully paid number
Nominal 
value
30.6.15 
£’000
30.6.14 
£’000
287,002,065 (2014: 282,782,065) £0.005 1,435 1,414
1,435 1,414
During the reporting period the Company undertook the following transactions involving the issuing and reclassifying 
issued share capital:
On 07 August 2014 a number of employees exercised their share options increasing the issued share capital  
by 790,000 shares at a premium price of between 5p and 7.5p. 
On 20 October 2014 a number of employees exercised their share options increasing the issued share capital  
by 730,000 shares at a premium price of between 5p and 7.5p.
On 18 December 2014 a number of employees exercised their share options increasing the issued share capital  
by 910,000 shares at a premium price of between 5p and 7.5p.
On 27 April 2015 a number of employees exercised their share options increasing the issued share capital  
by 1,790,000 shares at a premium price of between 5p and 7.5p.
Notes to the consolidated financial statements continued
For the year ended 30 June 2015 dotdigital Group Plc
Annual Report 2014/2015
59
Financial statements
19. Reserves
Group
Retained 
earnings 
£’000
Share 
premium 
£’000
Reverse 
acquisition 
reserve 
£’000
As at 1 July 2014 12,211 5,147 (4,695)
Issue of share capital – 235 –
Share repurchase – – –
Dividends (570) – –
Profit for the year 4,656 – –
Other comprehensive income: Currency translation – – –
Share based payment – – –
Balance as at 30 June 2015 16,297 5,382 (4,695)
Retranslation 
Reserve 
£’000
Other 
reserves 
£’000
Totals 
£’000
As at 1 July 2014 (6) 82 12,739
Issue of share capital – – 235
Share repurchase – (213) (213)
Dividends – – (570)
Profit for the year – – 4,656
Other comprehensive income: Currency translation 3 – 3
Share based payment – 106 106
Balance as at 30 June 2015 (3) (25) 16,956
Group
Retained 
earnings 
£’000
Share 
premium 
£’000
Reverse 
acquisition 
reserve 
£’000
As at 1 July 2013 9,071 4,863 (4,695)
Issue of share capital – 284 –
Dividends (279) – –
Profit for the year 3,419 – –
Currency translations – – –
Share based payments – – –
Balance as at 30 June 2014 12,211 5,147 (4,695)
Retranslation 
reserve 
£’000
Other 
reserves 
£’000
Totals 
£’000
As at 1 July 2013 (2) 13 9,250
Issue of share capital – – 284
Dividends – – (279)
Profit for the year – – 3,419
Currency translation (4) – (4)
Share based payment – 69 69
Balance as at 30 June 2014 (6) 82 12,739 dotdigital Group Plc
Annual Report 2014/2015
60
Company
 Retained 
earnings 
£’000
Share  
Premium 
£’000
Other 
reserves 
£’000
  
Totals 
£’000
At 1 July 2014 2,423 5,147 82 7,652
Issue of share capital – 235 – 235
Share repurchase – – (213) (213)
Dividends (570) – – (570)
Loss for the year (319) – – (319)
Share based payment – – 106 106
At 30 June 2015 1,534 5,382 (25) 6,891
Retained 
earnings 
£’000
Share  
premium
£’000
Share  
based 
payments 
£’000
 Totals 
£’000
At 1 July 2013 3,065 4,863 13 7,941
Issue of share capital – 284 – 284
Reclassification of reserves (279) – – (279)
Loss for the year (363) – – (363)
Share based payment – – 69 69
At 30 June 2014 2,423 5,147 82 7,652
20. Trade and other payables
Group Company
30.6.15 
£’000
30.6.14 
£’000
30.6.15 
£’000
30.6.14 
£’000
Current:
Trade payables 853 819 16 2
Amounts owed to Group undertkings – – 4 –
Social security and other taxes 498 549 – –
Other payables 349 391 91 12
VAT 574 559 – –
Accruals and deferred income 1,163 666 39 60
3,437 2,984 150 74
Further details on liquidity and interest rate risk can be found in Note 22.
21. Leasing agreements
Minimum lease payments under non cancellable operating leases fall due as follows:–
30.06.15
Land & 
Buildings 
£’000
Others 
£’000
Totals 
£’000
Within one year 232 19 251
Between two to five years 1,490 12 1,502
1,722 31 1,753
30.06.14
Land & 
Buildings 
£’000
Others 
£’000
Totals 
£’000
Within one year 311 34 345
Between two to five years 2,147 19 2,166
2,458 53 2,511
Notes to the consolidated financial statements continued
For the year ended 30 June 2015 dotdigital Group Plc
Annual Report 2014/2015
61
Financial statements
Operating leases represent rents payable by the Group for its office properties. Leases are negotiated for an average term 
if five years and rentals are fixed on average for two years with the option to extend for a further five years at the prevailing 
market rate at the time.
22. Financial instruments and risk management
The Groups activities expose it to a number of financial risks that include credit risk, liquidity risk, currency risk and interest 
rate risk. These risks and the Group’s policies for managing them have been applied consistently during the year and are 
set out below.
The Group hold no financial or non other financial instruments other than those utilised in the working operations of the 
Group and that listed in this note. It is the Group’s policy not to trade in derivative contracts.
Principle financial instruments
The principle financial instruments used by the Group, from which financial instrument rate risk arises, are  
as follows:
• Trade receivables
• Cash and cash equivalents
• Trade and other payables
Financial instruments by category
The following table sets out the financial instruments as at the reporting date:
Group Company
30.6.15 
£’000
30.6.14 
£’000
30.6.15 
£’000
30.6.14 
£’000
Financial assets
Trade and other receivables 5,328 3,662 16 24
Bank balances 11,932 9,306 166 109
17,260 12,968 182 133
Financial liabilities
Trade payables 853 819 16 2
Accrued liabilities and other payables 2,584 2,165 130 72
3,437 2,984 146 74
The fair value of the Financial assets and Financial liabilities equal to their carrying values. All financial assets are 
categorised as loans and receivables and all financial liabilities are categorised as financial liabilities at amortised costs.
General objectives, policies and processes
The Board has overall responsibility for the determination of the Group’s risk management objectives and policies and 
whilst retaining ultimate responsibility for them, it has delegated the authority for designing and operating processes that 
ensure the effective implementation of the objectives and policies to the Group’s risk committee. The Board receives 
monthly reports from the Risk Committee through which reviews the effectiveness of the processes put in place and the 
appropriateness of the objectives and policies it sets.
The overall objective of the Board is to set policies that seek to reduce risk as far as possible without unduly affecting the 
Company’s competitiveness and flexibility. Further details regarding these policies are set out below: dotdigital Group Plc
Annual Report 2014/2015
62
Interest rate risk
The Group’s interest rate risk arises from interest bearing assets and liabilities. The Group has in place a policy of 
maximising finance income by ensuring that cash balances earn a market rate of interest; offsetting where possible, cash 
balances and by forecasting and financing its working capital requirements. As at the reporting date the Group was not 
exposed to any movement in interest rates as it has not external borrowings and therefore not exposed to interest rate 
risk. No sensitivity analysis has been prepared.
The Group’s working capital requirements are managed through regular monitoring of the overall cash position and 
regularly updated cash flow forecasts to ensure there are sufficient funds available for its operations.
Liquidity risk
The Group’s working capital requirements are managed through regular monitoring of the overall position and regularly 
updated cash flow forecasts to ensure there are funds available for its operations. Management forecasts indicate no new 
borrowing facilities will be required in the upcoming financial period.
Trade and other payables of £2,365,000 (2014: £1,876,000) are expected to mature in less than a year
Credit risk
Credit risk arises principally from the Group’s trade receivables, as there are no trade receivables within the company, 
which comprise amounts due from customers. Prior to accepting new customers a credit check is obtained. As at 30 
June 2015 there were no significant debts pass their due period which had not been provided for. The maturity of the 
Groups trade receivables is as follows:
30.6.15 
£’000
30.6.14 
£’000
0-30 days 2,311 1,817
30-60 days 813 702
More than 60 days 1,465 600
4,589 3,119
The maturity of the Group’s provision for impairment is as follows:
30.6.15 
£’000
30.6.14 
£’000
0-30 days 2 –
30-60 days 2 83
More than 60 days 339 253
343 336
The movement in the provision for the impairment is as follows:
30.6.15 
£’000
30.6.14 
£’000
As at 1 July 2014 336 249
Provision for impairment 103 302
Receivable written off in the year (47) (165)
Unused amount reversed (49) (50)
As at 30 June 2015 343 336
Notes to the consolidated financial statements continued
For the year ended 30 June 2015 dotdigital Group Plc
Annual Report 2014/2015
63
Financial statements
The Group minimises its credit risk by profiling all new customers and monitoring existing client of the Group for changes 
in their initial profile. The level of trade receivables older than the average collection period consisted of a value of 
£1,486,597 (2014: £678,260) of which £339,962 (2014: £327,242) was provided for. The Group felt that the remainder 
would be collected post year end as they were with long standing relationships, the risk of default is considered to be low 
and write offs due to bad debts are extremely low. The Group has no significant concentration  
of credit risk, with the exposure spread over a large number of customers.
The credit risk on liquid funds is low as the counterparts are banks with high credit ratings assigned by international credit 
ratings. The majority of the company’s cash holdings are held at NatWest Bank who has an A credit rating.
The carrying value of both financial assets and liabilities approximates to fair value.
Capital Policy
The Groups objectives when managing capital are to safeguard its ability to continue as a going concern in order to 
provide optimal returns for shareholders and to maintain an efficient capital structure to reduce the cost of capital.
In doing so the Group’s strategy is to maintain a capital structure commensurate with a strong credit rating and to retain 
appropriate levels of liquidity headroom to ensure financial stability and flexibility. To achieve this, the Group monitors key 
credit metrics, risk and fixed charge cover to maintain this position. In addition the Group ensures a combination  
of appropriate short term and long term liquidity headroom. 
During the year the Group had a short term loan balance of £nil (2014: £nil) and amounts payable over one  
year are nil. The Group had a strong cash reserve to utilise for any short term capital requirements that were needed  
by the Group.
The Group has continued to look for a further long term investments or acquisitions and therefore to maintain  
or re-align the capital structure, the Group may adjust when dividends are paid to shareholders, return capital  
to shareholders, issue new shares or borrow from lenders.
23. Deferred tax
30.6.15 
£’000
30.6.14 
£’000
As at 1 July 58 14
Current year provision 325 44
383 58
The deferred tax liability above comprises the following temporary differences:
30.6.15 
£’000
30.6.14 
£’000
Capital allowances in excess of depreciation 103 58
R & D relief in excess of amortisation 679 600
Share option relief (399) (600)
383 58
The deferred tax provision relates to taxes to be levied by the same authority on the same entity expected to be settled at 
the same time. As such deferred tax assets and liabilities have been offset.
24. Capital commitments
The Company and Group have no capital commitments as at the year end. Last year the Company and Group had capital 
committed to £191,000 towards the fit out of the new London Bridge office. dotdigital Group Plc
Annual Report 2014/2015
64
25. Related party disclosures
Transactions between the company and its subsidiaries, which are related parties, have been eliminated on consolidation 
and are not disclosed in this note.
Group
The following transactions were carried out with related parties
Sale of services
30.6.15 
£’000
30.6.14 
£’000
Codence performance Entity under common 
directorship
Email marketing services 3 2
Coms.com Entity under common 
directorship
Email marketing services 4 8
7 10
Sales of services are based on the price lists in force and at terms that would be available to third parties
Purchase of services
30.6.15 
£’000
30.6.14 
£’000
Barratts of Old Ltd Entity under common 
directorship
Consultancy services 8 41
8 41
Key management compensation
Key management include Directors and the Company Secretary. The compensation paid for key management for 
employee services are shown below
30.6.15 
£’000
30.6.14 
£’000
Remuneration and other short term employee benefits 1,002 966
Share based payments 20 15
Pension cost 60 42
1,082 1,023
Directors
30.6.15 
£’000
30.6.14 
£’000
Aggregate emoluments 1,002 877
Company contributions to money purchase pension scheme 60 42
Share based payments 20 5
1,082 924
Information in relation to the highest paid Director is as follows:
30.6.15 
£’000
30.6.14 
£’000
Salaries 234 230
Other benefits 11 7
Pension costs 15 14
Share based payments 20 –
280 251
The highest paid Director excercised 660,000 share options in the year (2014: none).
Notes to the consolidated financial statements continued
For the year ended 30 June 2015 dotdigital Group Plc
Annual Report 2014/2015
65
Financial statements
Company
The following transactions were carried out with related parties
Year end balances arising from sales/purchase of services
30.6.15 
£’000
30.6.14 
£’000
dotmailer Limited Subsidiary Payables (3,280) (1,864)
dotagency Limited Subsidiary Receivables – 9
(3,280) (1,855)
The receivables and payables are unrestricted in nature and bear no interest. No provisions are held against receivables 
from related parties.
Loans to related parties
30.6.15 
£’000
30.6.14 
£’000
dotmailer Limited Subsidiary
As at 1 July 5,681 5,400
Loans advanced 751 324
Loans repaid (44) (43)
6,388 5,681
Key management compensation
Key management are Non-Executive Directors. The compensation paid for key management for employee services are 
shown below
30.6.15 
£’000
30.6.14 
£’000
Remuneration and other short term employee benefits – 95
– 95
Directors
30.6.15 
£’000
30.6.14 
£’000
Aggregate emoluments – 95
– 95
26. Ultimate controlling party
There is no ultimate controlling party of the Group. dotdigital Group Plc acts as the parent company to dotmailer Limited, 
dotagency Limited, dotsearch Europe Limited, dotmailer Inc, dotsurvey Limited (Dormant), DotSEO Limited (Dormant), 
dotcommerce Limited (Dormant) and doteditor Limited (Dormant).  dotdigital Group Plc
Annual Report 2014/2015
66
27. Share-based payment transactions
The measurement requirements of IFRS 2 have been implemented in respect of share options that were granted  
after 7 November 2002. The expense recognised for share based payment made during the year is £106,000  
(2014: £69,000)
Vesting conditions of the options dictate that employees must remain in the employment of the Group for the whole period 
to qualify. 
Movement in issued share options during the year
The table illustrates the number and weighted average exercise price (WAEP) of, and movements in share options during 
the period. The options outstanding at 30 June 2015 had a WAEP of 14.43p (2014: 8.82p) and a weighted average 
contracted life of 2.1 (2014: 2.8) years and their exercise prices ranged from 1p to 31.50p. All share options are settled  
in form of equity issued.
30.06.15 
No of options WAEP
30.6.14 
No of options WAEP
Outstanding at the beginning of the period 13,923,790 8.82p 16,117,930 7.54p
Granted during the year 2,275,000 29.53p 3,655,860 18.25p
Forfeited/cancelled during the period 1,040,000 16.56p 540,000 12.57p
Exchanged for shares 4,220,000 6.06p 5,310,000 5.80p
Outstanding at the end of the period 10,938,790 14.43p 13,923,790 8.82p
Exercisable at the end of the period 8,462,724 10.44p 9,517,930 4.09p
The weighted average share price at the date of the exercise for share options exercised during the period was 30.52p 
(2014: 30.58p)
The inputs into the black-scholes model are as follows:
10 April  
2015
28 November 
2014
18 October 
2013
Number of options granted 750,000 1,525,000 3,554,794
Share price at grant date 31.50p 29.00p 17.82p
Exercise price 31.50p 28.50p 18.25p
Option life in years 5 5 5
Risk free rate 1.33% 1.35% 1.40%
Expected volatility 30% 30% 30%
Expected dividend yield 0% 0% 0.4%
Fair value of options/warrants 5.64p 5.33p 3.31p
Expected volatility was determined by calculating the historical volatility of the Group’s share price from the date it listed to 
the grant date of the share option. The expected life used in the model is based on management’s best estimate, for the 
effects of non-transferability, exercise restrictions and behavioural considerations.
Notes to the consolidated financial statements continued
For the year ended 30 June 2015 dotdigital Group Plc
Annual Report 2014/2015
67
Financial statements
28. Group reconciliation of profit before corporation tax to cash generated from operations 
Group Company
30.6.15 
£’000
30.6.14 
£’000
30.6.15 
£’000
30.6.14 
£’000
Current:
Profit before tax from all operations 5,243 3,600 (319) (363)
Currency revaluation 3 (4) – –
Depreciation 1,556 1,117 – –
(Profit)/Loss on disposal of fixed assets (1) 1 – –
Share based payments 106 69 106 69
Finance income (27) (20) – –
6,880 4,763 (213) (294)
(Increase)/decrease in trade receivables (1,666) (769) 721 1,578
Increase/(decrease) in trade payables 453 1,303 76 (1,277)
Cash generated from operations 5,667 5,297 584 7
29. Group cash and cash equivalents
The amounts disclosed on the statement of cash flow in respect of cash and cash equivalents are in respect of these 
statements of financial position amounts: 
Group
£’000
Company
£’000
As at 1 July 2013 6,072 70
As at 31 July 2014 9,306 109
As at 30 June 2015 11,932 166
30.06.15
£’000
30.06.14
£’000
Net cash flow from discontinued operations – –
Net cash generated from operating activities – (95)
Net cash generated from investing activities – –
Net cash used in financing activities – –
30. Project development
During the period the Group incurred £1,611,929 (2014: £1,344,414) in development investments. All resources utilised  
in development has been capitalised as outlined in the accounting policy governing this area.
31. Events after the end of the reporting period
There are no post balance sheet events which impact the Group’s financial statement. dotdigital Group Plc
Annual Report 2014/2015
68
Company information
For the year ended 30 June 2015
Directors:
S Bird 
P A Simmonds 
I Taylor 
R Kellett-Clarke  
F Beechinor-Collins 
S J Barratt 
M Patel
Company Secretary:
M Patel 
Auditors:
Jeffreys Henry LLP 
Statutory Auditor 
Finsgate 5-7 Cranwood Street 
London 
EC1V 9EE
Nomad/broker:
N+1 Singer 
1 Bartholomew Lane 
London 
EC2N 2AX
Joint broker:
Finncap 
60 New Broad Street 
London 
EC2M 1JJ
Solicitors:
BPE Solicitors LLP 
St James House 
St James Square 
Cheltenham 
GL50 3PR
Registered office:
No. 1 London Bridge 
London 
SE1 9BG
Registered number:
06289659 (England and Wales)  www.dotdigitalgroup.com