oncateno plc oncateno plc
Concateno plc  Annual Report and Accounts 2008
Annual Report and Accounts 2008 
Concateno plc
10 Buckingham Street
London
WC2N 6DF
T +44 20 7004 2800  
F +44 20 7004 2801
E info@concateno.com
www.concateno.com
Linking it all together Contents
01 Highlights
02 Group overview – our products and services 
04 Group overview – our geographical reach
06 Group overview – the markets we operate in
08 Chairman’s Statement
10 Chief Executive Officer’s Review
13 Financial Review
16 Board of Directors
17  Financial Statements index
18 Directors’ Report 
21 Corporate Governance Report
24 Directors’ Remuneration Report
26 Statement of Directors’ Responsibilities
27 Independent Auditors’ Report
28 Consolidated Income Statement
28  Consolidated Statement of Recognised Income  
and Expense
29 Consolidated Balance Sheet
30 Consolidated Cash Flow Statement
31 Notes to the Consolidated Financial Statements
61  Company Balance Sheet
62  Notes to the Company Balance Sheet
65 Advisers
Concateno is a global provider of drug and alcohol testing 
and related services as well as a manufacturer of clinical 
diagnostic products. 
 
Drug and Alcohol abuse is a growing problem in society. 
Concateno is at the forefront of this issue, working with 
governments, employers and healthcare and law 
professionals to help reduce the impact of this problem. 
Our expertise is unmatched and our staff are passionate 
about working with clients to identify the best possible 
solutions for them. 
 
Following the successful integration of our subsidiary 
businesses, Concateno can now provide the optimal type 
of drug testing in any biological sample.  
 
Building on our expertise in Europe the Company is now 
poised to both expand geographically and to develop new 
market sectors.  
Cozart
® 
DDS: the Group’s leading oral fluid testing 
device, field proven with police forces and 
employers internationally.
Advisers >
Registered Office
Concateno plc
10 Buckingham Street
London
WC2N 6DF
Registered Number
05396234 England and Wales
Nominated Adviser and Broker
Collins Stewart (Europe) Limited
9th Floor
88 Wood Street
London
EC2V 7QR
Joint Brokers
SingerCapital Markets Limited
One Hanover Street
London 
W1S 1AX
Evolution Securities Limited
100 Wood Street
London EC2V 7AN
Solicitors to the Company
Jones Day
21 Tudor Street
London
EC4A 0DJ
Auditors
KPMG Audit Plc
1 Forest Gate
Brighton Road
Crawley
RH11 9PT
Principal Bankers
Barclays Bank plc
Head Office Branch
1 Churchill Place
London
E14 5HP
Public Relations Advisers
Financial Dynamics 
Holborn Gate
26 Southampton Buildings
London 
WC2A 1PB
Company Secretary
Rowena Nixon
10 Buckingham Street
London 
WC2N 6DF
Registrars
Capita Registrars
The Registry
34 Beckenham Road
Beckenham
Kent
BR3 4TU
Patent Agents
Marks and Clerk
4220 Nash Court
Oxford Business Park South
Oxford OX4 2RU 01
Concateno plc 
Annual Report and Accounts 2008
Financial highlights Corporate highlights
£4 7.5
m
Revenue
(2007: £26.1m)
14
%
Increase in unaudited pro forma
1
 revenue 
2008: £47.5m (2007: £41.8m) 
54
%
Increase in unaudited pro forma
1
 adjusted EBITDA
2
 
2008: £12.3m (2007: £8.0m) 
£4.2
m
Operating profit 
(2007: £2.0m)
1  Pro forma results (unaudited) are annualised results as if all business combinations 
were in place on 1 January each year.
2   See EBITDA reconciliation in Financial Review.
Concateno established as the European  >
market leader in the provision of drug and 
alcohol testing services
£3.3m annualised operational synergies  >
achieved earlier than plan
International networks of 90 distributors  >
and 500 sample collectors giving the 
Group a unique global footprint
Three specialist UKAS accredited  >
laboratories and two state-of-the-art 
manufacturing facilities
Unique ‘one-stop-shop’ offering a high  >
quality service for the management of 
Drugs of Abuse testing 
Restructuring of the sales and marketing  >
functions to target ‘vertical’ customer 
markets. Successful adoption of model in 
the UK now being rolled out internationally
Winner of the 2008 Queens Award for  >
Enterprise in Innovation
Renewal of the Home Office ‘Drug  >
Intervention Programme’ contract for up to 
three years
Our highlights > Concateno plc 
Annual Report and Accounts 2008 02
Group overview >
Our products and services
Concateno is Europe’s most focused drug 
and alcohol testing facility. This is reflected in:
The consultative sales and marketing  >
divisional structure, providing expert 
market knowledge across diverse  
market sectors. 
The delivery of products and services  >
from the group’s specialist manufacturers, 
laboratories and distributors.
Innovations 
Concateno’s New Product Development 
integrates the Company’s unique knowledge 
specialisms through a rigorously structured 
and market centred process. New 
innovations to date include:
Employee Assistance Programmes  >
offering expert advice and specialist 
counselling and support. 
Non-invasive S-PMA testing detecting  >
benzene at or below current health 
standards. 
DDS-U – a rapid urine test with   >
built-in reader. 
EtG hair test – test detecting   >
the metabolite of alcohol  
produced in the body.
 
integrated 
solutions >
Cozart
®
 DDS – Concateno’s 
enhanced on-site saliva 
drug detection system 
>   Used extensively by police  
forces, drug treatment centres and  
healthcare professionals
>   Sample collection in less than one minute
>   Digital analysis of test cartridge
>   Multiple printouts of results
Drug Solids Testing
>   Used internationally by Customs and  
Border Control Agencies 
>  Able to detect drugs at parts per million
>  Results in two minutes
Pro forma revenue  
growth
2007>2008
13
% 03
Concateno plc 
Annual Report and Accounts 2008
1 2
3
Point-of-Care 
testing
Laboratory 
based 
testing
Laboratory 
products
Key features:
>  Used on location 
>  Results in minutes
>   Oral fluid and urine matrices for drug testing
>   Oral fluid and breath testing for alcohol
>   Environmental detection of drugs in powders, tablets,  
resins, liquids and surfaces
Key features:
>  All laboratories UKAS accredited to ISO 17025
>   Capability to test any sample type:  
hair, urine, sweat, oral fluid, blood
>  Legally defensible results
>  Global collections network 
Key features:
>   Comprehensive range of diagnostic  
tests and reagents to the global clinical  
diagnostics market 
>   Manufactured at Concateno’s accredited and  
purpose built facilities in the UK and Spain 
>   Over 30 years experience of producing clinical  
diagnostic kits
>  Products sold into over 100 countries
>  Complementary line of instrumentation
Cozart
®
 DDS – Concateno’s 
enhanced on-site saliva 
drug detection system 
>   Used extensively by police  
forces, drug treatment centres and  
healthcare professionals
>   Sample collection in less than one minute
>   Digital analysis of test cartridge
>   Multiple printouts of results
Oral fluid 
>  Non invasive sample collection
>  Testing for recent use
>  Onsite and laboratory testing
Urine
>  Good indicator of usage over several days 
>  Well established and understood method
>  Onsite and laboratory testing 
Hair
>  Non invasive sample collection 
>  Testing for longer term use
>  Limited opportunity for sample adulteration 
Pro forma revenue  
growth
2007>2008
Pro forma revenue  
growth
2007>2008
Concateno branded urine point  
of care tests 
>   The only brand used by HM Prison Service  
voluntary testing
15
%
13
% Concateno plc 
Annual Report and Accounts 2008 04
UK = £28.3m (2007: £18.2m)
Continential Europe = £10.7m 
(2007: £5.0m)
Rest of World = £8.4m 
(2007: £2.9m)
Group overview >
Our geographic reach
Integrating our global services 
Through its acquisitions, Concateno  
has created a wide footprint of offices, 
distribution partners and sample  
collection officers. These resources  
are a powerful base from which to grow 
revenues rapidly and cost effectively.  
 
Our aim is to replicate the success of  
our UK business internationally with initial 
emphasis on our own offices in Scandinavia, 
Italy and Spain. In addition, we are focused 
on increasing sales of our POCT products 
through existing distribution partners 
particularly in Australia and Europe.  
 
We are also successfully recruiting  
new local channels for other territories, 
building first on our worldwide and long 
established partners that distribute our 
laboratory products.
 
Geographic reach
North Africa  >
Served by our local partner 
Santé Lab (Algeria) 
South America  >
Served by a number of distributors,  
including Labcenter in Mexico.  
We have recently hired a local  
country manager to develop this  
market further.  
 
 
Our locations
Argentina, Australia, Austria, Bahrain, Belgium, Brazil, Canada, Czech 
Republic, Denmark, Estonia, Finland, France, Germany, Greece, 
Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Japan, Kuwait, 
Liechtenstein, Luxembourg, Maldives, Mexico, Netherlands, New 
Zealand, North America, Norway, Pakistan, Peru, Philippines, Poland, 
Portugal, Qatar, Romania, Russia, Serbia, Seychelles, Sierra Leone, 
Singapore, Slovakia, Slovenia, South Africa, Spain, Sri Lanka, 
Sweden, Switzerland, Taiwan, Thailand, Tunisia, Turkey, Ukraine, United 
Arab Emirates, United Kingdom, United States, Venezuela, Vietnam.
connecting 
sectors >
> 2008 revenue by geography 05
Concateno plc 
Annual Report and Accounts 2008
United Kingdom >
Concateno is the number one supplier in this 
diverse and growing market. Through its long 
established contracts with government 
agencies our experience and credibility in all 
types of drug and alcohol testing is 
unmatched. Equally, we are the largest and 
most experienced provider of workplace 
testing and associated support services.
EMEA  >
The business enjoys a strong presence in 
the Middle East through its contracts with, 
amongst others, Emirates Airlines. In 
addition it has developed strong distribution 
partners in the wider region, for example, 
Pera Medikal, an important and growing 
distributor in the Turkish market.
Italy  >
Our office continues to show 
strong year-on-year revenue growth. 
Following a change in workplace 
legislation we were able to produce 
a fully compliant product immediately 
for which early sales and customer 
feedback is excellent. 
South America  >
Served by a number of distributors,  
including Labcenter in Mexico.  
We have recently hired a local  
country manager to develop this  
market further.  
 
 
Spain  >
Our Spanish Manufacturing and Sales Offices 
has proven expertise in the research and 
development of in vitro clinical diagnostic 
reagents with over 30 years experience of 
producing the clinical diagnostic kits with 
products sold into over 100 countries. 
Scandinavia  >
Following integration of all 
our business interests in this 
market our local office is 
successfully expanding out 
of its niche healthcare market 
to become the leading player 
in the region. 
Australia  >
Concateno has a strong presence in this 
dynamic and pioneering market having worked 
with all State Police Forces to develop the 
roadside drug testing market. We continue to 
see sales growth as rollout continues, as well 
as diversification into other market sectors. 
 Collection facilities
 Sales offices
 Distribution offices
Case study
Ireland: Concateno joins up with the Irish  >
Defence Forces 
Concateno won a two-year, €60,000 contract with Ireland’s Defence 
Forces to carry out random drug testing on its troops serving at home 
and abroad. 
Detecting drugs of abuse including heroin and crack/cocaine, among 
others, the programme, delivered through Concateno’s specialist 
workplace division, will test 10% of the Defence Forces personnel 
annually. Providing diagnostic equipment, resources and training 
services to test the troops on site, usually within barracks, is a primary 
screening procedure to detect drug abuse. 
‘Consumption of illegal drugs is simply incompatible with service life 
and our random drugs testing programme ensures that we have a 
strong deterrent and to identify those abusing drugs. In the last five 
years we have tested 7,000 personnel and will continue to do so,  
at home and overseas,’ said Commandant Gavin Young, Defence 
Forces spokesman.
The contract also provides Defence Forces with a rapid response 
collection capability: skilled Concateno officers are on call to attend 
when ‘for cause’ tests are required – even if these are on overseas 
postings, such as earlier this year when trained sample collection 
officers donned flak jackets on a visit to soldiers stationed in Kosovo. 
An initial test is made using Concateno’s point-of-care rapid-testing 
cups, which allow urine samples to be taken and tested quickly and 
efficiently, offering an immediate indication of a potential positive 
result for drug abuse. The simplicity and speed of the process means 
troops can be tested with the minimum disruption to their duties. Concateno plc 
Annual Report and Accounts 2008 06
Group overview >
The markets we operate in 
Key drivers for our market include: 
Growing social concern over   >
substance misuse.
Wider awareness of the link between  >
drug use and crime.
Increased investment in ‘harm reduction’  >
and treatment.
Greater acceptance of workplace   >
drug testing programmes.
Our Opportunity:
International access to previously  >
unaddressed markets.
Product innovation and increased R&D. >
Cross selling into existing clients. >
Scale, experience and credibility.  >
 
Our sectors
> realising 
synergies
Workplace
Helping organisations manage 
the risk that drug and alcohol 
misuse can bring by developing 
Drug and Alcohol policies; 
providing staff and management 
education and training courses; 
supplying Employee Assistance 
Programmes and rehabilitation 
services; devising optimal 
testing services.
Pre-employment and  
in-employment testing. 
 
Maritime
Concateno is the largest and 
most experienced provider to 
the global Maritime industry, 
running fleet-wide random 
testing programmes. Its 
international network of sample 
collection officers ensures that 
testing can be carried out in any 
port around the globe. 
  07
Concateno plc 
Annual Report and Accounts 2008
Criminal Justice
Concateno is the most 
experienced provider of Drug 
Testing services to the UK 
Government through its work 
within Her Majesty’s Prison 
Service and the Home Office 
Drug Intervention Programme. 
 
Laboratory Products
Concateno develops and 
manufactures a broad range of 
clinical diagnostic products in 
liquid reagent and microplate 
format. It also supplies a range 
of clinical analysers and 
laboratory instruments available 
through a long-established 
international distribution network 
that spans 80 countries.
Medico-Legal
Concateno has the most expert 
laboratory devoted to analysis of 
hair. Over 4,000 law firms 
currently use Concateno’s 
Trichotest along with over 85% 
of UK Police Forces.
Healthcare
The treatment and rehabilitation 
of individuals affected by 
substance misuse is becoming 
more important for Governments 
and policy makers. Concateno 
has developed a full range of 
drug and alcohol testing services 
to meet the unique requirements 
of this market.  Concateno plc 
Annual Report and Accounts 2008 08
Chairman’s Statement >
Keith Tozzi 
Chairman
> looking 
forward
‘Concateno has enhanced its market 
leading position by substantially 
increasing revenues and margins 
whilst maintaining high levels of 
customer service and retention.’
14
%
Increase in unaudited pro forma
1
 adjusted revenue
2008: £47.5m (2007: £41.8m)
£4 7.5
m
Revenue
(2007: £26.1m) 09
Concateno plc 
Annual Report and Accounts 2008
I am delighted to report Concateno’s financial results for the year 
ended 31 December 2008. Following a series of acquisitions of drugs 
of abuse testing businesses the previous year, during 2008 we have 
transformed Concateno from a group of seven separate businesses 
into the integrated European market leader. 
Each constituent acquisition was an expert in its field, whether it be in 
the testing of a particular matrix (such as hair or oral fluid), through 
unique networks (such as Spinreact’s distributors or Medscreen’s 
global collection operation), or technical expertise (such as 
TrichoTech’s award winning hair testing methodologies, or Cozart’s 
state-of-the-art Point-of-Care devices). By integrating these 
businesses, we are now able to offer all this expertise to all our clients.
The success of this strategy in 2008 has been borne out by high 
customer retention, new contract wins, and growing cross-selling of 
products and services in both the UK and increasingly in 
overseas markets.
Sales in the year to 31 December 2008 were £47.5m (2007: £26.1m) 
and earnings before share-based payments, non-recurring items, 
interest, tax, depreciation and amortisation (‘EBITDA’) were £12.3m 
(2007: £6.2m
2
). Group profit before interest and tax was £4.2m (2007: 
£2.0m) and adjusted basic earnings per share increased to 6.34p 
from 5.29p in 2007. Further details are provided in the Financial 
Review on pages 13 to 15.
Operational Leverage
We stated at the time of the acquisition of Cozart in October 2007 that 
we would seek to achieve annualised operational synergies of £3m by 
the end of 2008, and as I confirmed in my Interim report in September 
2008, we actually achieved total synergies of £3.3m, that are 10% 
above our target and earlier than planned. With the integration phase 
now effectively complete we are focusing on leveraging operational 
synergies, by servicing existing and new customers through our current 
infrastructure. We are investing in our core sales, laboratory and finance 
business systems and undertaking further procurement reviews.
Our focus is on maximising value from our existing asset base 
through organic growth and driving international opportunities, 
extending the model that we have successfully implemented in the 
UK to Europe and other territories. Our strategy for international 
development is fourfold:
to drive organic growth from our existing operations; •	
to extend the ‘Concateno Model’ into territories where we have a •	
direct presence (such as Sweden and Italy); 
to leverage the current ninety distribution relationships and global •	
support network that we have around the world to selectively 
target specific markets and territories that are ready to develop 
drug testing (i.e. through regulatory change); and 
to make selective in-fill acquisitions in international territories to •	
accelerate growth.
Market dynamics
Each of our markets shows differing dynamics:
Criminal Justice •	 – moderate growth and higher margins in the UK 
underpinned by long term government contracts. Encouraging 
signs of international growth
Workplace •	 – an expanding pipeline of opportunities and customer 
conversions as regulation and best practice amongst employers is 
extended. We have a very low level of exposure to the pre-
employment market
Maritime •	 – continued growth in sales aided by new products and 
sales. The regulated oil and chemical tanker market in which we 
predominantly operate remains robust
Medico-Legal •	 – rapid adoption of hair testing in the UK Courts 
system has seen dramatic growth in our business. Exciting 
international opportunities exist in this field in which we are  
world leaders
Healthcare •	 – capped UK budgets have meant only limited growth, 
albeit with opportunities to develop access to budgets in disease 
prevention and the wider health service
Lab Products •	 – Spinreact continues to leverage its niche position 
in this large market. There are exciting opportunities in many 
developing economies
Our staff
I would like to thank all our staff for their continued hard work during 
2008 and for helping us make Concateno the industry leader in the 
European Drugs of Abuse testing sector. 
Offer update
On 8 July 2008, following press speculation, we confirmed that we 
had received a number of expressions of interest in Concateno and 
that we had appointed UBS Investment Bank as financial adviser to 
help the Board consider a range of options for enhancing shareholder 
value, including a possible sale of the Group. Since that time, we have 
been in an ‘Offer Period’. The Company is now at an advanced stage 
in that process and expects to be able to announce its conclusion in 
the relative short term.
Current Trading and Outlook
Despite the difficult wider macro-economic environment we have 
been encouraged by the trading performance of the Group in the year 
to date. We have good visibility over revenues, with approximately half 
of our sales generated from the public sector and an additional 
quarter from highly regulated private sector customers.
The Board believes that the Company is successfully delivering on its 
strategy and looks forward to 2009 with confidence.
Annual General Meeting
The Annual General Meeting of the Company is to be held on 14 May 
2009. The notice convening the AGM accompanies this report.
Keith Tozzi
Chairman
30 March 2009
1  Pro forma results (unaudited) are annualised results as if all business combinations 
were in place on 1 January each year.
2   See EBITDA reconciliation in Financial Review.
UK: Workplace testing – BBC uses Concateno’s reference data  >
Over the 2008 August Bank Holiday weekend, six BBC TV and radio programmes referred to 
Concateno’s workplace drugs and alcohol data for news and commentary. The broadcasts, 
including the top-rated BBC Radio 5’s Drive, Radio 4’s Today and BBC TV’s Working Lunch 
programmes, highlighted statistics indicating that drug and alcohol tests in the UK had risen by 
nearly a fifth in the first half of the year, with employers requesting over 100,000 workplace tests.
As Europe’s largest provider of drug and alcohol testing solutions, conducting over 8 million 
tests annually, Concateno has the most extensive reference database to draw upon, enabling 
drug misuse trends to be monitored, helping support employers, government and healthcare 
leaders in formulating their drug and alcohol policies. 
Case study Concateno plc 
Annual Report and Accounts 2008 10
Chief Executive   >
Officer’s Review
Fiona Begley 
Chief Executive Officer
40
%
Sales generated from outside the UK
(2007: 30%)
£3.3
m
Annualised operational synergies achieved earlier than plan
> enabling 
growth
‘Having integrated the businesses in 
2008 our focus turns to international 
growth and leveraging the resources 
of our UK centres of excellence.’ 11
Concateno plc 
Annual Report and Accounts 2008
Restructuring and Margin Improvement
At the end of 2007, Concateno consisted of seven separate acquired 
entities, operating under their own brands and methodologies. During 
2008 we have integrated those businesses and rolled out a common 
Group wide approach to sales, sample collection, laboratory 
processing, training and quality assurance.
Integration
A review of the integration projects and synergies achieved was set 
out in the 2008 Interim Report and Accounts. A number of sites were 
rationalised during the year, including:
migration of the Warrington oral-fluid testing laboratory to •	
Abingdon (completed May);
closure of the CPL International site in Liverpool with the migration •	
of the workflow to Cardiff and Canary Wharf (completed June);
closure of the Paddington office with the migration of the workflow •	
to Canary Wharf (completed July);
closure of the Gothenburg office in Sweden with the migration of •	
the workflow to Canary Wharf (completed July); and
closure of the Wakefield office with migration of the workflow to •	
Canary Wharf (completed January 2009).
The result is that we now have three Centres of Excellence in the UK:
Abingdon – oral-fluid testing, Cozart POC (‘Point-of-Care’) device •	
manufacture and R&D.
Cardiff – hair testing. •	
Canary Wharf – urine testing. •	
as well as our laboratory product manufacturing site in Girona, Spain 
and sales offices in Stockholm, Barcelona and Rome.
The resulting annualised synergies are £3.3 million.
Sales and Marketing
At the beginning of 2008, we restructured the sales and marketing 
functions of the various businesses to address ‘vertical’ markets in 
order that the specific needs of customer groups would be better 
targeted, product and service offerings tailored to their requirements 
and best practice rolled out to other clients. This approach has been 
well received by customers.
Highlights in 2008 included:
The renewal of the Drug Intervention Programme (‘DIP’) with the •	
Home Office in July 2008, which included upgrading their installed 
base of Cozart POC devices to the higher margin Cozart
®
 DDS 
variant. Contracts with the Home Office now have an annual value 
of ~£3.4m.
Increased uptake of hair-testing in the medico-legal sector. •	
TrichoTech, the Group’s hair-testing specialist operation based in 
Cardiff, is the leader in this field. Hair testing benefits from being 
able to detect drug misuse in the previous months rather than just 
days and is therefore of particular value in family law. TrichoTech 
also offers an expert witness statement service.  Year-on-year 
revenue growth in this market sector was more than 40%.
Criminal 
Justice Workplace Maritime
Medico-
Legal Healthcare
Lab 
Products
Summary  
of product/
service 
provided.
Products 
and services 
to support 
drug-testing 
in prisons, 
police 
custody 
suites and  
at the 
roadside.
Provision of 
pre- and 
in-employment 
drug testing for 
regulated and 
safety-critical 
industries.
Provision of 
fully 
managed 
drug-testing 
services to 
merchant 
vessels.
Hair testing 
to support 
court cases 
around family 
law and child 
protection. 
Pre- and 
in-
employment 
hair testing.
Provision of 
drug-testing 
services  
to support 
non-
custodial 
court  
orders and 
prisoners  
on probation
Supply of 
reagents 
and 
analysers to 
distributors 
principally 
for use by 
hospital and 
clinical 
laboratories.
Example
customers
–  HM Prison 
Service, 
–  Home 
Office, 
–  State of 
Victoria 
Police
–  Laing 
O’Rourke
–  TFL
–  United 
Biscuits
Fleet 
management 
companies, 
e.g. V Ships, 
and direct to 
ship owners 
worldwide.
Individual  
law firms  
and social 
services 
covering both 
private and 
public cases.
Drug Actions 
Teams and 
Private 
Healthcare 
organisations.
–  Santé Lab 
(Algeria).
–  Labcenter 
(South 
America)
–  Chronolab 
Systems 
(Spain)
Tender win to provide the NHS with a full range of DoA products •	
and services from our expanded portfolio.
Roll-out of dried blood spot testing methodology for blood borne •	
viruses (‘BBV’) to healthcare clients, particularly in the drug 
treatment services where harm reduction is part of their remit. 
BBVs, including Hepatitis C and HIV, are prevalent amongst  
drug users.
New Workplace contract wins including Defence Forces Ireland, •	
First Group, Greater Manchester Police and Irish Rail. Additional 
contracts in 2009 include Scottish Police, Bovis Lend Lease and 
Speedy Hire.
Adoption of Cozart POC devices by HM Revenue & Customs to •	
help in the fight against drug-trafficking.
Successful roll-out of testing for benzene, a major carcinogen and •	
component of many maritime cargoes, to the Group’s installed 
maritime client base.
These contract wins, and others, combined with high customer 
retention rates have meant that we have seen year-on-year growth in 
all vertical sectors during 2008.
       Lab 
       Products 
  Criminal Work-  Medico- Health- & Intl  
£’m Justice place Maritime Legal care  distributors Total
2007  
(Pro forma) 6.9 4.8 5.9 3.6 10.7 9.9 41.8
2008 7.6 5.5 6.4 5.2 11.0 11.8 47.5
% Change 10% 13% 9% 44% 3% 19% 14%
Following the successful adoption of the ‘Concateno Model’ in the 
UK, we have started to roll-out the same model across Europe, 
offering a comprehensive DoA product and service offering. Initial 
successes have included:
Roll-out of hair testing to the Spanish market. •	
Rapid Development of a urine variant of the DDS product to meet •	
recent Italian workplace legislation (see below).
Distribution of POC products to Swedish Customs Service. •	
 
We see growth coming from a number of areas:
Growth in existing markets driven by increased acceptance of •	
regulation, growing prevalence of drug misuse and recognition by 
employers and government bodies of the benefits of structured 
testing programmes and associated support services. 
New product and service offerings to current and new customers •	
in the DoA arena (e.g. DDS-U, BBV, Benzene).
Expansion into new markets, either through geographical •	
expansion, or by leveraging off current relationships by offering 
new products and services. 
Excellence of Service
The Group has focused on ensuring that the highest standards are 
met at all times, illustrated by the fact that our Cardiff laboratory won 
the Queens Award for Enterprise in Innovation. Quality Assurance 
Managers are based at each of our laboratories to ensure that 
standards are rigorously applied and all Account Managers have 
been trained on the Group’s products and our expert toxicologists 
ensure that up-to-date advice and results of a consistent standard are 
given regardless of where our clients are in the world. We have also 
increased resources in our Customer Services department to ensure 
that customer queries are answered expeditiously and that we are 
pro-active in anticipating customer needs.
All of our locations are covered by third party accreditation and/ 
or certification. 
   ISO 17025  ISO 9001 
   Testing and  ISO 13485 Quality 
   Calibration  Medical Management 
   Laboratories Devices System
Abingdon  Yes Yes Yes
Canary Wharf  Yes NA Yes
Cardiff  Yes NA NA
Spain  NA Yes Yes Concateno plc 
Annual Report and Accounts 2008 12
Chief Executive Officer’s Review continued >
Further developments in 2009
Additional work will be undertaken during 2009 to integrate the 
businesses further including:
An ongoing procurement review to rationalise our product offering •	
and reduce costs including the development of a centralised 
warehousing and stock control system.
Integrated ‘New Product Development’ process leveraging •	
innovation and expertise across the wider group; forthcoming 
products include the next generation of oral fluid sample collector.
Progressing the development of the UK’s information management •	
systems including the Laboratory Information Management 
Systems (‘LIMS’), Customer Relationship Management tools, and 
finance systems.
Roll-out of a ‘Training Academy’ to develop our key staff. •	
We continue to invest in the businesses, with the latest laboratory 
testing equipment being maintained, so that we can meet the 
increased demands of our customers, test for a wider range of drugs 
of abuse and provide more detailed analysis to our clients.
We also continue to develop new products and services. The benzene 
and EtG tests announced in our last annual report have been 
successfully rolled out and in 2009 we are supplementing this with an 
emergency benzene test kit in case of an accident on site or at sea.
Following a change in legislation in Italy, we were able to develop a 
urine Point-of-Care device to provide a quantifiable reading. We 
brought this product to market within three months and we are 
already seeing encouraging sales in the first quarter of 2009. 
We have a pipeline of new products and services which we are 
currently developing and will roll-out over the forthcoming months 
and years.
We also continue to explore ways to make the sample collection 
process easier and more efficient. We have rolled-out a training 
programme to all our collectors around the world and reviewed the 
Quality Assurance process to ensure that standards of collection are 
consistently high and the integrity of the ‘chain-of-custody’ is 
maintained. We offer a 24/7 collection service. Our TrichoTech 
operation is also trialling ‘walk-in centres’ in Liverpool and 
Manchester.
The Group continues to develop the next generation of handheld 
drug testing devices in conjunction with Philips, and both companies 
announced the successful launch of the Magnotech technology at the 
Medica conference in Dusseldorf in November 2008. Development 
and commercialisation of the device is ongoing and launch is due in 
the second half of 2009.
By understanding and anticipating our customers’ needs and 
demanding exceptional quality in the products and services that we 
offer we feel that we are well positioned to benefit from the growing 
Drugs of Abuse testing market in 2009 and beyond.
Fiona Begley
Chief Executive Officer
30 March 2009
Case study
Concateno and Phillips share a commitment to  >
help reduce the impact of drug abuse
With drug abuse a growing issue in today’s society, Concateno and 
Philips share a commitment to working with government, employers, 
healthcare and law professionals to help reduce the impact of this 
problem. Since 2006 the two organisations have been developing an 
innovative handheld drugs of abuse detection device. The new 
solution will be launched to selected customers in 2009 and brings 
together Concateno’s expertise in the field of immunoassay 
development with Philips’ revolutionary ‘Magnotech’ technology.
 
‘The Concateno-Philips drug screening test will be the first product 
that features Philips’ Magnotech technology, a new biosensor 
technology that uses magnetic nanoparticles to measure low 
concentrations of target molecules in blood and saliva.’ said Marcel 
van Kasteel, VP of Philips and CEO of Philips Handheld 
Immunoassays. ‘This first collaboration is a means of demonstrating 
the excellence and robustness of the new technology with a company 
that is synonymous with road-side testing and is already working 
closely with government departments and police forces. It will be the 
catalyst for them to grow and expand their European and global 
markets. Magnotech delivers them a highly accurate result in less 
than two minutes from a saliva sample,’ added Mr. van Kasteel. 13
Concateno plc 
Annual Report and Accounts 2008
Financial Review >
Neil Elton 
Finance Director
‘In 2008 Concateno has combined 
strong revenue growth and margin 
improvements with solid cash 
conversion. The completed 
integration projects in 2008 will 
act as a good foundation for further 
operational leverage in 2009.’
Overview
Results for the Group are stated for the year ending 31 December 
2008 with comparatives for the year ended 2007. 
Sales in the year to 31 December 2008 were £47.5m (2007: £26.1m). 
Earnings before share-based payments, non-recurring items, interest, 
tax, depreciation and amortisation EBITDA were £12.3m (2007: 
£6.2m) representing an increase in margin from 23.8% to 25.9%. After 
charging depreciation of £1.3m (2007: £0.6m) EBITA was £11.0m 
(2007: £5.6m). Loss after tax for the year was £0.4m (2007: profit of 
£0.7m) following non-recurring charges in the year of £3.0m (2007: 
£0.8m) and exceptional finance costs of £1.5m (2007: £nil). A tax 
credit of £0.2m (2007: credit of £0.3m) was recognised in the year 
(representing an effective tax rate of 28% for the group).
There were no material acquisitions or disposals during 2008, 
but a number of acquisitions throughout 2007. In order to aid 
shareholders’ understanding of year-on-year performance we have 
included aggregated unaudited pro forma numbers to show how the 
business would have performed had all the acquisitions occurred on 
1 January 2007.
Divisional Performance
Year ended  
31 December    
 Unaudited  
   2007  
£m 2008 Pro forma
1
 2007 to 2008 % change
Revenue:
Laboratory Services 24.1 21.3 2.8 13.1%
Point of Care 12.9 11.4 1.5 13.2%
Laboratory Products 10.5 9.1 1.4 15.4%
Total 47.5 41.8 5.7 13.6%
EBITDA: 
Laboratory Services 9.4 6.3 3.1 49.2%
Point of Care 3.8 2.4 1.4 58.3%
Laboratory Products 1.3 0.9 0.4 44.4%
Central (2.2) (1.6) (0.6) 37.5%
Total 12.3 8.0 4.3 53.5%
Margin  25.8% 19.2%  6.6%
1  Pro forma results (unaudited) are annualised results as if all business combinations 
were in place on 1 January each year.
> delivering 
efficiency Concateno plc 
Annual Report and Accounts 2008 14
Financial Review continued >
Like-for-like performance
Approximately 63% (2007: 63%) of the Group’s sales are undertaken 
in Pounds Sterling with the balance of the Group’s sales settled 
predominantly in US Dollars and Euros. With the depreciation of 
Pounds Sterling, particularly in the second half of 2008, the results 
reported by the Group have been affected by the fluctuation in these 
exchange rates. The table below restates the proforma results for the 
Group for 2007, based on the exchange rates, experienced during 
2008 so that the results for the two years may be compared on a 
like-for-like basis. The main currencies and rates used are 
US$1.86:£1, €1.26:£1 and SEK12.10:£1.
Like-for-like Divisional Performance
Year ended  
 31 December  2007 
 Unaudited  Adjusted Adjusted 
£m 2008 Pro forma
1
 2007 to 2008 % change
Sales 47.5 43.7 3.8 8.8%
Gross Profit 27.5 25.0 2.5 10.0%
Margin 57.8% 57.2%  0.6%
 EBITDA 12.3 8.3 4.0 48.6%
 Margin  25.8% 18.9%  6.9%
1  Pro forma results (unaudited) are annualised results as if all business combinations 
were in place on 1 January each year.
This shows that like-for-like proforma revenue growth in 2008 was 
£3.8m (8.8%) compared with reported proforma growth of £5.7m 
(13.6%) and like-for-like growth in proforma EBITDA was £4.0m 
(48.6%) compared with reported growth of £4.3m (53.5%).
 
Because the Group has similar foreign currency payment obligations 
as it does foreign currency receipts the Group is reasonably internally 
hedged to foreign currency fluctuations. The Group does not have any 
foreign currency hedges in place, but keeps this under regular review.
Interest and tax
Net finance costs in the year totalled £4.8m (2007: £1.7m). This 
included an exceptional finance charge of £1.5m, discussed below.
The effective tax rate for the full year was 27.9%. The comparable 
underlying tax rate for the prior year was 26.8%. 
EPS
Basic earnings/(loss) per share (‘EPS’) for the year was (0.43p) (2007: 
1.05p), the decrease on 2007 being primarily due to the investment 
made during the year in restructuring and integration projects (see 
non-recurring items for more detail below) and an exceptional charge 
in respect of an interest hedge. Adjusted basic EPS
2
 for the year was 
6.34p (2007: 5.29p), representing a 20% increase.
Cash and financing
Net borrowings at 31 December 2008 were £25.7m (2007: £36.0m). 
These comprised current loans, borrowings and overdrafts of £28.1m 
(2007: £5.6m), non-current loans and borrowings of £0.3m (2007: 
£33.7m, including £8.3m Convertible loan which was converted 
during 2008), cash of £4.3m (2007: £3.9m) and net derivative financial 
instruments of £1.6m (2007: £0.6m).
All term loan debts are disclosed as current liabilities because the 
existing term loan that, after unamortised debt issue costs, totalled 
£24.7m at 31 December 2008 (2007: £28.2m) is due to be repaid in 
full on 31 December 2009. As at 30 March 2009, the Group has not 
put in place refinancing beyond the end of 2009. If the Company were 
not able to refinance the term loan debt before the end of the year, 
this may result in a going concern risk. The Board has considered this 
risk but believes that, despite the difficult financial markets, it is in a 
good position to refinance. The Board is taking the following actions:
Case study
UK Government awards Concateno oral  >
screening contract 
The processing of arrestees in police detention has been improved by 
using a quicker, simpler testing device. In a two-year, £4.5 million 
Home Office contract awarded in July 2008, Concateno provides 
police in England and Wales with a new device to detect heroin and 
cocaine/crack in the oral fluid of arrestees.
The police conduct in the region of 220,000 such tests each year 
using Concateno’s drug detection system Cozart
®
 DDS to provide a 
simple, quick answer; as a result approximately 4,000 drug misusers 
are referred to treatment every month. Recorded crime figures show 
that acquisitive crime has fallen by more than a fifth since the 
programme started.
As part of the government’s DIP, the tests are a key part of the 
national strategy for tackling drugs and reducing crime. Currently, in 
areas where drug testing is in operation, anyone arrested for trigger 
offences such as burglary and robbery is tested to find out if they 
have taken heroin or cocaine. Those who test positive are required to 
attend an assessment of their drug dependency and related needs. 15
Concateno plc 
Annual Report and Accounts 2008
■ Laboratory Services  50.7%
■ Point-of-care  27.1%
■ Laboratory Products  22.2%
■ UK   59.7%
■ Continental Europe  22.6%%
■ Rest of World  17.7%%
It is in discussions with a number of banks whose Credit •	
Committees have agreed in principle to provide re-financing in full 
either individually or in partnership.
The Group is in advanced stages of negotiation with the banks •	
who have undertaken extensive due diligence.
The Group has demonstrated strong financial performance and •	
cash generation and has complied and continues to comply with 
all its covenant obligations.
The Group is comparatively lowly geared at less than two  •	
times EBITDA.
The Company will look to confirm refinancing as soon as it comes out 
of the current Offer period and well in advance of the end of 2009.
 
The current term loan is subject to interest based on one month 
LIBOR, until 30 June 2009 and three month LIBOR between 1 July 
and 31 December 2009. The Company has in place an interest rate 
hedge facility adopted in November 2007 over 75% of the scheduled 
bank loan balances until December 2014. The effect of the hedge is 
to cap interest rates payable on that portion of the bank debt at 6.5%. 
Should LIBOR fall below 3.73% (LIBOR was 2.05% at 28 February 
2009) a strike rate of 5.75% is payable. The net fair value of this 
derivative financial instrument at 31 December 2008 was £1.5m 
(2007: £0.2m) all of which has been charged to the Income Statement 
as an exceptional finance charge in 2008 (2007: £0.2m charged to the 
hedging reserve). Further details are given in Note 16.
The balance of the loans and borrowings comprise finance lease 
commitments of £0.2m (2007: £0.4m) and zero interest-bearing loans 
granted to fund R&D in Spain of £0.5m (2007: £0.5m).
The Company issued 10,840,292 ordinary shares during the year. Of 
this 10,587,355 shares were issued in settlement of a Convertible 
Loan in November 2008. The original loan of £8.7m was issued at the 
time of the acquisition of Cozart in October 2007 and attracted 
interest at a rate of 12.5% per annum. 
The balance of shares issued in the year related to the exercise of 
employee share options and settlement of a deferred consideration 
payment falling due to the former owners of Nemesis Scientific Ltd 
(acquired by the Cozart group in March 2007).
Non-recurring and exceptional items
Non-recurring charges and exceptional items in the year were £4.5m 
(2007: £0.8m) and comprised:
Charges related to the integration projects undertaken in 2008 of •	
£1.7m (2007: £0.4m).
A provision for onerous leases on vacated premises of £0.4m •	
(2007: £nil).
Charges related to the impairment of assets of £0.2m (2007: £nil). •	
Other non-routine professional costs of £0.7m (2007: £0.4m). •	
Exceptional finance charges related to change in designation of •	
interest rate hedging instrument of £1.5m (2007: £nil)
Further details are provided in Notes 3 and 7.
Dividends
The Board is not recommending a dividend for the year to 31 
December 2008 (2007: £nil). It is the Board’s policy that dividends will 
be paid, subject to availability of distributable reserves, when it is 
appropriate and prudent to do so. The main focus of the Company 
continues to be delivering capital growth for shareholders.
KPIs
The Group uses a wide variety of performance indicators in the 
tracking and management of the business. Financial key performance 
indicators (‘KPIs’) relate to revenue growth, EBITDA margins and 
> 2008 revenue by division > 2008 revenue by geography
growth as well as operating cash flow and free cash flow targets (free 
cash flow being cash flow after working capital movements, 
exceptional items, tax and capital expenditure but before interest and 
debt principal repayments). Other financial and operational KPIs used 
by each of the business units are tailored to those entities and include 
revenue forecast ‘gap’ analysis, quote tracking, sample turnaround 
times and customer feedback.
These KPIs are recorded on a regular basis, used within the 
businesses throughout the year, and reported to the Board on a 
monthly basis in order that they can assess the performance of the 
Group and underlying business units.
Neil Elton
Finance Director
30 March 2009
2  Adjusted EPS excludes the after tax impact of intangibles amortisation, £2.6m  
(2007: £1.6m), non-recurring items, £3.4m (2007: £0.7m) and share-based payments, 
£0.6m (2007: £0.4m).
Reconciliation from Operating Profit to EBITDA
Year ended  
31 December    
 Unaudited  
     2007 
   2008 2007 Pro forma 
£m Note Actual Actual (unaudited)
Operating Profit  4.2 2.0 0.8
Reverse impact of:   
 Depreciation 4 1.3 0.6 1.1
 Amortisation 4 4.0 2.4 2.7
 Non-recurring items 3 3.0 0.8 3.0
 Foreign exchange 
gains  4 (0.8) – (0.1)
 Share-based 
    payments 24 0.6 0.4 0.5
EBITDA  12.3 6.2 8.0 Concateno plc 
Annual Report and Accounts 2008 16
Board of Directors >
1. Dr Christopher Hand
Non-Executive Director
Chris has a DPhil from the Faculty of Medicine, University of Oxford; a 
BSc in Applied Biochemistry from Brunel University and is a 
Chartered Chemist and Member of the Royal Society of Chemistry. 
Chris founded Cozart Bioscience Ltd in 1993 and was Chief 
Executive of Cozart plc following its listing onto AIM in 2004, until 
October 2007 when the Company was acquired by Concateno plc. 
During this time the Company won three SMART awards from the 
Department of Trade and Industry, won Millennium Product Status for 
its ground breaking Cozart
®
 RapiScan system and acquired 
companies in Sweden, Spain and the UK. 
Prior to founding Cozart, Chris was Director of Research for the 
European base of the medical diagnostics company DPC (now part of 
Siemens Healthcare Solutions). Chris is currently a Director of 
Abingdon Health Ltd.
2. Fiona Begley
Chief Executive Officer
Fiona holds a Bachelor of Science in Biochemistry from the National 
University of Ireland, Galway and an MBA from Henley Management 
College. Fiona joined Medscreen in 1996 as Sales and Marketing 
Manager. She was appointed General Manager in 1998, Managing 
Director in 2000 and led the management buy-out from PharmChem 
in 2002. Concateno plc acquired Medscreen as its platform 
acquisition in 2006.
From 1992 to 1995, Fiona held management roles for Syva UK and 
Behring Diagnostics UK with a focus on business development and 
marketing in the diagnostics industry. Prior to 1992 Fiona was a 
product manager and biochemist in the pharmaceuticals and 
biotechnology sector.
3. James Corsellis
Non-Executive Director
James has a BA (Hons) from London University and is currently 
Managing Partner at Marwyn Investment Management. Over the past 
two years at Marwyn, James has undertaken over 50 transactions 
raising in excess of £1bn in acquisition funding for Marwyn backed 
management teams and special purpose acquisition vehicles. 
James is currently a Director of Aldgate Capital plc, Drury Lane 
Capital plc, Entertainment One Ltd, Marwyn Value Investors, is 
currently Deputy Chairman of Catalina Holdings Ltd and was 
previously Chief Executive Officer of icollector plc.
4. Neil Elton
Finance Director
Neil qualified as a Chartered Accountant with Arthur Andersen. He 
was a consultant to Mecom from 2000 (one of Europe’s largest 
newspaper publishers), joining the Board as Finance Director in 
March 2005, when the Company listed on AIM, until June 2006. 
Prior to Mecom, Neil was Group Finance Manager at Huntsworth plc, 
the international PR group, with oversight of their financial PR and 
healthcare divisions. Before that, he was Finance Director of MirrorTel, 
Mirror Group plc’s television and audiotex division, and financial 
co-ordinator of the integration with Trinity International plc following 
their merger in 1999 to form Trinity Mirror plc.
5. Vin Murria
Non-Executive Director
Vin has over 20 years’ experience of working for Venture Capital, 
Private Equity and publicly listed companies focused on the software 
sector. During this time, Vin has held a number of senior positions, 
including Chief Executive Officer of Computer Software Group plc, 
which she took private in May 2007. The company merged with 
IRIS in July 2007 and was subsequently exited to Hellman Friedman 
for $1bn.
 
Vin is a Partner at Elderstreet Capital, and prior to this was European 
Chief Operating Officer for Kewill Systems Plc and Chairman of Leeds 
Group Plc. She is the Chief Executive Officer of Advanced Computer 
Software plc, and remains Chair of BSG plc, Innovise Plc and is a 
Non-Executive Director at the Fredricks Charitable Foundation.
6. Keith Tozzi
Executive Chairman
Keith has wide experience at board level in creating and developing 
successful businesses. He was Group Technical Director (one of 
three Executive Directors) of Southern Water plc from 1992–1996. 
From 1996–2000, he was Chief Executive of the British Standards 
Institution (a London based Independent Royal Charter Company) 
where he grew turnover to over £200m and acquired businesses 
in the UK, South America and Eastern Europe to leverage the brand. 
From 2000–2003, he was Group Chief Executive of Swan Group plc 
(owner of Mid Kent Water) and led a management buy-out backed 
by WestLB. 
Most recently, Keith was Chairman of Inspicio plc, an AIM-listed 
testing and inspection company that was listed as a special purpose 
vehicle in April 2005 and sold for £264.3m in January 2008.
1
6 3 4
2 5 Concateno plc 
Annual Report and Accounts 2008 17
Financial Statements Index >
In this section
18 Directors’ Report 
21 Corporate Governance Report
24 Directors’ Remuneration Report
26 Statement of Directors’ Responsibilities
27 Independent Auditors’ Report
28 Consolidated Income Statement
28  Consolidated Statement of Recognised Income and Expense
29 Consolidated Balance Sheet
30 Consolidated Cash Flow Statement
31 Notes to the Consolidated Financial Statements
61  Company Balance Sheet
62  Notes to the Company Balance Sheet
65 Advisers Concateno plc 
Annual Report and Accounts 2008 18
Directors’ Report >
For the year ended 31 December 2008
The Directors present their report and the audited financial statements for the year ended 31 December 2008.
Business Review
The Company is required by the Companies Act to include a business review in this report. The Directors’ Report contains a fair review of the 
business and a description of the principal risks and uncertainties facing the Group. A review of the business strategy and a commentary on the 
performance of the business is set out in the Chairman’s Statement, the Chief Executive’s Review and the Financial Review on pages 8 to 15.  
A discussion of key performance indicators is included within the Financial Review on pages 13 to 15.
 
The Directors’ Report is prepared for the members of the Company and should not be relied upon by any other party or for any other purpose. 
Where the Directors’ Report (including the Chairman’s Statement, the Chief Executive’s Review and the Financial Review) contains forward-
looking statements, these are made by the Directors in good faith based on the information available to them at the time of their approval of this 
report. Consequently such statements should be treated with caution due to the inherent uncertainties, including both economic and business 
risk factors, underlying such forward-looking statements or information.
Principal activities
The principal activity of the Group is the development, manufacture and sale of medical diagnostic tests and services, predominantly those 
used for the detection of alcohol and drugs of abuse.
The principal activity of the Company is that of a holding Company. The subsidiary undertakings principally affecting the profits or net assets of 
the Group in the year are listed in Note 28 to the financial statements.
Going concern
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 Company is currently in the process of negotiating a refinancing package. Further details are included in the Financial Review on pages 13 
to 15.
Results and dividends
The audited financial statements are set out on pages 18 to 63. The Group made a loss after taxation for the year ended 31 December 2008 of 
£424,000 (2007: profit of £665,000).
The Directors do not recommend the payment of a dividend for the period (2007: £nil).
Directors and their interests
The Directors who held office during the year are detailed below. 
K Tozzi  Chairman
F Begley  Chief Executive Officer
N Elton   Finance Director  
J Corsellis  Non-Executive Director
V Murria  Non-Executive Director 
C Hand  Non-Executive Director 
K Tozzi and F Begley retire by rotation in accordance with the Articles of Association and, being eligible, offer themselves for re-election.
The Directors’ beneficial interests in the ordinary shares of 10p each (‘ordinary shares’) of the Company, were as follows:
         Ordinary  Ordinary 
         shares of 10p shares of 10p 
          31 December 31 December 
         2008 2007
K Tozzi         143,000 100,000
F Begley         981,777 941,1 77
N Elton         – –
J Corsellis         58,824 58,824
V Murria         155,000 – 
C Hand         1,369,013 1,369,013
Details of the Directors’ share options and service contracts are shown in the Directors’ Remuneration Report on pages 24 and 25.
Biographical details of the Directors are given on page 16. 19
Concateno plc 
Annual Report and Accounts 2008
Substantial shareholdings
The Directors are aware of the following who have an interest in 3% or more of the Company as at 17 March 2009:
         Ordinary  
         shares of 10p %
Marwyn Investment Management LLP
1
        29,174,852  27.49
Fidelity (Institutional Group)         6,682,899  6.30
Powe Capital Management, LLP         4,808,669  4.53
Knox D’Arcy Investment Management Limited        3,609,913 3.40
Aviva Investors Global Services Limited        3,562,002  3.36
Schroder Investment Management Ltd. (SIM)        3,443,590  3.24
HSBC Investment Bank (MM)         3,260,700  3.07
       
1  Marwyn Investment Management LLP is the Investment Manager for both Marwyn Neptune Fund LP and Marwyn Ventures 1 LP, which hold 28,899,852 and 275,000 Concateno plc 
shares respectively.      
Group research and development activities
The total research and development activities undertaken by the Group amounted to £1,507,000 (2007: £306,000). All research and non-
qualifying development costs were written off during the year in which they were incurred. During the year £1,125,000 (2007: £247,000) of 
development expenditure was capitalised in line with the accounting policy set out in Note 1 to the financial statements. 
Charitable and political contributions
During the year the Group made charitable donations of £6,578 (2007: £1,731) to charities serving the communities in which the Group 
operates. No political donations were made during the year.
Supplier payment policy
It is the Group’s policy to settle debts with its creditors on a timely basis, taking into consideration the terms and conditions offered by each 
supplier. At 31 December 2008, the number of creditor days outstanding for the Group was 56 days (2007: 36 days).
The Group does not follow a standard code or payment practice.
Risks relating to the business of Concateno
Internal Controls
The Directors are responsible for the Group’s system of internal control and for reviewing its effectiveness whilst the role of management is to 
implement Board policies on risk management and control. It should be recognised that the Group’s system of internal control is designed to 
manage, rather than eliminate, the risk of failure to achieve the Group’s business objectives and can only provide reasonable, and not absolute, 
assurance against material misstatement or loss.
The Group is currently developing the risk management process, to embed it in normal management, and the governance process. These 
controls include, but are not limited to, the annual strategic planning and budgeting process, a clearly defined organisational structure with 
authorisation limits, reviews by senior management of monthly financial and operating information including comparisons with budgets, monthly 
treasury and cash flow reports and forecasts to the main Board and rules preventing speculation in derivatives.
The Board does not believe it is currently appropriate to establish a separate, independent internal audit function given the size of the Group. 
However, it undertakes reviews of internal controls on a regular basis and a Risk Review Committee was set up in 2008 to assist with this 
process.
Continued market growth
The Company is reliant upon growth in the drug and alcohol testing market within the UK and Rest of the World in order to increase trading 
volumes. The dependence upon governmental and industrial testing requirements and the growth of these requirements is a risk that the 
Company cannot directly control, but can mitigate by entering new markets. The failure of such market growth to continue could have a material 
adverse impact on the Group’s business, financial condition, trading performance and prospects.
In the current economic climate, the Company faces additional pressures. However, with government-funded and regulated markets, 
management feel that this risk is somewhat mitigated.
Dependence upon key executives and personnel
The Company has several key executives and senior personnel, who are of considerable worth to the Company in terms of their market 
knowledge, strategic importance, and intellectual property value. In order to ensure minimal risk to the Company, key person insurances and 
contractual obligations are in place to minimise the impact of loss of any of these persons. The loss of any member of the Group’s senior 
operational management could harm or delay the business whilst management time is directed to finding suitable replacements or if no suitable 
replacement is available to the Group. In either case this could have a material adverse effect on the future of the Group’s business. Whilst the 
Group has entered into service agreements with these key personnel, the retention of their services cannot be guaranteed.
Investment Strategy
There can be no certainty that the Group will be able to successfully implement its strategy as set out in the Chairman’s statement. The ability 
of the Group to implement its strategy in a competitive market requires effective planning and management control systems. The Group’s future 
growth will depend on its ability to expand and improve operational, financial and management information and control systems in line with the 
Group’s growth. Failure to do so could have an adverse effect on the Group’s business and financial condition. Concateno plc 
Annual Report and Accounts 2008 20
Law and regulation
The Company operates its normal business activities within relevant legal and regulatory compliance listings. These risks include industry 
legislation, regulatory control and health and safety compliance. The Company operates over international boundaries that entail the risk of 
litigation and governmental non-compliance with regulatory requirements. These risks are minimised primarily by contractual obligations with 
stakeholders (e.g. customers and suppliers) and by compliance within reasonable operating activities.
The drugs of abuse testing market, being the Group’s core market area, is subject to a large number of laws and regulations. The Group’s 
success in the future will be dependent on the legislative framework in which it operates and the Directors have no influence over such matters.
Existing and future legislation, regulation and actions could cause additional expense, capital expenditure, restrictions and delays in the 
activities of the Group, the extent of which cannot be predicted. No assurance can be given that the new laws, rules and regulations will not be 
enacted or existing laws, rules and regulations will not be applied in a manner which could limit or curtail certain of the Group’s services.
Dependence on key customers
The Company has the risk of dependence upon key customers. This risk is mitigated by developing a close relationship with clients and entering 
into contracts where possible. Given the increased scale of the Group the dependence on any one client has been significantly reduced during 
the year. Where there is risk remaining and insufficient evidence of collectability of debts from customers, an allowance for impairment is made.
Price risk
The Group has no significant exposure to securities price risk as it holds no listed equity investments.
Financial Risk Management
The Board considers that the main risks arising from the Group’s financial instruments are currency risk, credit risk, interest rate risk, liquidity 
risk and covenant risk. The use of financial derivatives is governed by the Group’s policies approved by the Board of Directors. The Group does 
not use derivative financial instruments for speculative purposes.
(i) Currency risk
The Group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates. The Group uses foreign exchange 
forward contracts, where cost effective to do so, and otherwise uses natural hedging methods where possible to minimise exposure in this area.
(ii) Credit risk
The Group’s principal financial assets are bank balances and cash, trade and other debtors.
The Group’s credit risk is primarily attributable to its trade debtors. The amounts presented in the balance sheet are net of allowances for 
doubtful debtors. An allowance for impairment is made where there is an identified loss event which, based on previous experience, is evidence 
of a reduction in the recoverability of the cash flows. The Group has no significant concentration of credit risk, with exposure spread over a 
large number of counterparties and customers.
(iii) Interest rate risk and liquidity risk
In order to maintain liquidity to ensure that sufficient funds are available for ongoing operations and future developments, the Group uses a 
mixture of long-term and short-term debt finance. The Group’s policy throughout the year has been to minimise risk by placing funds in low risk 
cash deposits but also to maximise the return on funds placed on deposit. 
The Group is currently undergoing refinancing negotiations. See Financial Review for details.
(iv) Covenant Risk
The Group must comply with a number of financial covenants as part of the term loan facilities. The Group regularly monitors actual and 
forecast compliance with these covenants and makes regular reports to the banks.
Further details are provided in Note 19 of the Financial Statements.
Annual General Meeting
The Annual General Meeting will be held at the offices of Collins Stewart, London on 14 May 2009 commencing at 10am. 
Auditors
Each of the persons who is a Director at the date of approval of this report confirms that:
(1) so far as the Director is aware, there is no relevant audit information of which the Company’s auditors are unaware; and
(2) the Director has taken all the steps that he ought to have taken as a Director in order to make himself aware of any relevant audit information 
and to establish that the Company’s auditors are aware of that information.
This confirmation is given and should be interpreted in accordance with the provisions of s234ZA of the Companies Act 1985.
In accordance with Section 384 of the Companies Act 1985, a resolution for the re-appointment of KPMG Audit Plc as auditors of the Company 
is to be proposed at the forthcoming Annual General Meeting.
By order of the Board
Rowena Nixon
Company Secretary
30 March 2009
Directors’ Report  > continued
For the year ended 31 December 2008 21
Concateno plc 
Annual Report and Accounts 2008
Corporate Governance Report >
For the year ended 31 December 2008
AIM listed companies are not required to comply with the disclosure requirements of the New Combined Code on Corporate Governance. 
However, the Board supports the principles contained in the New Combined Code and is committed to applying the principles set out therein 
where they are appropriate, given the Company’s size. The following provides information on how these principles have been applied but does 
not constitute full compliance with the New Combined Code. 
Board of Directors
The Company is controlled by the Board of Directors which comprises three Executive and three Non-Executive Directors. 
The Board is responsible to shareholders for the proper management of the Group and meets formally at least every two months to set the 
overall direction and strategy of the Group, to review financial and operating performance and to advise on senior management appointments. 
Financial policy and budgets, including capital expenditure, are approved and monitored by the Board. All key operational decisions are subject 
to Board approval. The Company Secretary is responsible for ensuring that Board procedures are followed and that applicable rules and 
regulations are complied with.
Different Directors hold the roles of Chairman and Chief Executive and there is a clear division of responsibilities between them. Individual 
Directors possess a wide variety of skills and experience; biographical details of the Directors are set out on page 16.
The Non-Executive Directors are considered by the Board to be independent of management. The Board considers that the Non-Executive 
Directors are of sufficient calibre and number to bring the strength of independence to the Board. The terms and conditions of appointment of 
Non-Executive Directors are available on request.
The Board believes that given its size and constitution it is not appropriate to specify a ‘senior’ Non-Executive Director.
During the year, there have been 10 main Board meetings. The schedule on the following page gives attendance and non-attendance by Board 
members for meetings throughout the year.
All Board members receive monthly management accounts and regular management reports enabling them to review the Group’s performance 
against agreed objectives. Regular reports and papers are circulated to Directors in a timely manner in preparation for Board and Committee 
meetings. This information includes that specifically requested by the Non-Executive Directors from time to time.
Board evaluation
The Board is mindful of the requirement to undertake an annual evaluation of its performance and that of its committees and individual 
Directors. It is the intention of the Board to adopt the following procedures in order to conduct performance evaluation.
The performance of the Board, its committees, the Executive Directors and Non-Executive Directors will be evaluated by the Chairman on an 
ongoing basis.
Re-election
Directors are subject to election by shareholders at the first opportunity after their appointment and a third are subject to re-election at each 
Annual General Meeting.
Committees of the Board
Audit Committee 
The Audit Committee comprises two Non-Executive Directors; Dr C Hand (Chairman) and J Corsellis. It overviews the monitoring of the Group’s 
internal controls, accounting policies and financial reporting and provides a forum through which the external auditors report. It also reviews the 
scope and results of the external audit and the independence and objectivity of the auditors and makes recommendations to the Board on 
issues surrounding their remuneration, appointment, resignation or removal. The Board is satisfied that the Audit Committee has sufficient 
financial knowledge and experience. The Audit Committee should meet at least twice a year with the external auditors. 
During the year there have been three Audit Committee meetings. The meetings were attended by both Committee members. 
Terms of reference for the Audit Committee are available on request. These include definition of its role and the authority delegated to it by  
the Board.
Remuneration Committee 
The Remuneration Committee comprises two Non-Executive Directors, J Corsellis (Chairman) and V Murria. The Committee reviews, inter alia, 
the performance of the Executive Directors and sets the scale and structure of their remuneration and the basis of their service agreements with 
due regard to the interests of the shareholders. The Remuneration Committee also makes recommendations to the Executive Directors 
concerning the allocation of share options to employees. The Committee should meet at least twice a year.
During the year, there have been two Remuneration Committee meetings. The meetings were attended by both Committee members at the time. 
It is a policy of the Remuneration Committee that no individual participates in discussions or decisions concerning his own remuneration.
Terms of reference for the Remuneration Committee explain its role and the authority delegated to it by the Board. These are available on request. Concateno plc 
Annual Report and Accounts 2008 22
The Directors’ Remuneration Report is set out on pages 24 and 25.
A summary of meeting attendances by the Board of Directors and its Committees is given below.
       Main Audit Remuneration  
       Board Committee Committee AGM
Executive Directors   
K Tozzi       10/10 – – 1/1
F Begley       10/10 – – 1/1
N Elton       10/10 – – 1/1
Non-Executive Directors
J Corsellis       8/10 3/3 2/2 1/1
C Hand       10/10 3/3 – 1/1
V Murria       10/10 – 2/2 1/1
Internal control
The Directors have overall responsibility for ensuring that the Group maintains a system of internal control to provide them with reasonable 
assurance that the assets of the Group are safeguarded and that the shareholders’ investments are protected. The system includes internal 
controls covering financial, operational and compliance areas, and risk management. There are limitations in any system of internal control, 
which can provide reasonable but not absolute assurance with respect to the preparation of financial information, the safeguarding of assets 
and the possibility of material misstatement or loss.
The Board has considered and reviewed the effectiveness of the system of internal control. An assessment of the major risk areas for the 
business and methods used to monitor and control them was also considered. During the year under review, a number of key controls have 
been improved and integrated across the business. In addition to financial risk, the review covered operational, commercial, environmental, 
regulatory, and research and development risks. The risk review is an ongoing process with regular review by the Board at least annually. 
The key procedures designed to provide an effective system of internal control that have operated throughout the year and up to the date of the 
sign-off of this report are described below:
Control environment
The Group has a clearly defined organisational structure. Managers of operating units assume responsibility for, and exercise a high degree of 
autonomy in, running day-to-day trading activities. Employees are required to follow clearly laid out internal procedures and policies appropriate 
to the business and their position within the business.
Risk management
The Group employs Directors and senior executives with the appropriate knowledge and experience for the Company. A formal risk 
management review is performed annually as part of the process of determining the Group’s system of internal controls and risk  
mitigation procedures. 
Risk procedures are carried out via the centralised Quality Assurance system. Each business within the Group currently holds separate 
certification and/or accreditation:
ISO 13485 – Medical Devices: •	
o Cozart.
o Spinreact.
ISO9001 – Quality Management System: •	
o Medscreen.
o Euromed.
o Spinreact.
o Cozart.
Cozart ISO 17025 – Testing and Calibration Laboratories: •	
o Medscreen.
o Altrix.
o TrichoTech.
o Cozart.
There is a dedicated Quality Manager at each site responsible for the day-to-day activities required to maintain certification/accreditation, and  
to report and escalate any issues that are identified. This provides an early warning system and ensures swift and effective corrective and 
preventative action.
The Group Quality Manager, based at Abingdon, oversees all activities and produces a weekly and monthly report for the Chief Operating 
Officer. These reports are discussed monthly at the Group Operational Executive and a monthly report is sent to the main Board. A single 
Quality System continues to be implemented ensuring that best practice is migrated across the Group.
Corporate Governance Report  > continued
For the year ended 31 December 2008 23
Concateno plc 
Annual Report and Accounts 2008
Financial information 
The Group prepares detailed budgets and cash flow projections, which are approved annually by the Board and updated regularly throughout 
the year. Detailed management accounts and working capital cash flow projections are prepared on a monthly basis and compared to budgets 
and projections to identify any significant variances.
Management of liquid resources
The Board is risk adverse when investing the Group’s surplus cash funds. The Executive Directors monitor the Group’s cash position on a 
weekly basis. The Group’s treasury management policy is reviewed annually and sets out strict procedures and limits on how surplus funds  
are invested.
Internal audit
The Board has considered it inappropriate to establish a formal internal audit function during the year, given the size of the Group. Although 
there has been no formal internal audit function, financial reviews have been performed between Group companies on a regular basis and work 
is under way to formalise this process more over the coming year.
Relations with shareholders
The Board attaches great importance to effective communication with both institutional and private shareholders. In fulfilment of the Chairman’s 
obligations under the new Combined Code, the Chairman gives feedback to the Board on issues raised with him by major shareholders. 
Regular communication is maintained with all shareholders through Company announcements, the Annual Report and Financial Statements, 
Preliminary Results and the Interim Report. 
All shareholders are sent copies of the Interim and Annual Reports and are given notice to enable them to attend the Company’s Annual 
General Meeting and any Extraordinary General Meeting. Shareholders whose shares are held by nominees may receive the information on 
request. The Annual General Meeting is normally attended by all Directors, and shareholders are invited to ask questions during the meeting 
and to meet with Directors after formal proceedings.
In addition, the Company operates a website: www.concateno.com. It contains information on the Group and its activities, press releases and 
regulatory announcements, Annual Financial Statements and Interim Statements, and details of the Company’s share price.  Concateno plc 
Annual Report and Accounts 2008 24
Directors’ Remuneration Report >
For the year ended 31 December 2008
The following information has been provided in accordance with best practice even though it is not all a requirement of the AIM Rules of the 
London Stock Exchange. The information presented in the Directors’ Remuneration Report is unaudited unless otherwise stated.
Remuneration policy
The Remuneration Committee currently comprises two Non-Executive Directors; J Corsellis and V Murria. The Chairman and other senior 
executives attend meetings from time to time at the invitation of the Committee. Remuneration levels are set in order to attract high calibre 
recruits and to retain and motivate those Directors and employees once they have joined the Group.
Remuneration package for Executive Directors
The individual components of the remuneration package offered to Executive Directors are as follows:
(i) Basic salary
Basic salaries are reviewed on a regular basis. The review process is undertaken by having regard to the development of the Group and the 
contribution that individuals will continue to make. Consideration is also given to the need to retain and motivate individuals and information on 
the salary levels in comparable organisations. 
(ii) Annual performance incentives
Annual performance incentives in the form of cash bonus payments are reviewed on an annual basis and are designed to reward Executive 
Directors for exceptional performance.
(iii) Pension and other benefits
The Company makes contracted contribution into personal pension schemes for the Executive Directors.
Other benefits provided to Executive Directors are life assurance and private medical insurance.
(iv) Share options
Options granted to employees under the Company’s Enterprise Management Incentive (‘EMI’) or Employee Benefit Trust Incentive Scheme are 
recommended by the Executive Directors and approved by the Remuneration Committee. 
Executive Directors are awarded share options at the discretion of the Remuneration Committee. Share options are granted at the closing 
mid-market value of the Company’s ordinary shares on the day prior to grant, or where the Remuneration Committee consider that the share 
options are issued further to an acquisition event they are granted at the share price pertaining to that acquisition event.
Remuneration policy for Non-Executive Directors
The remuneration of the Non-Executive Directors is determined by the Board as a whole, based on a review of current practices in  
other companies. 
The Non-Executive Directors have service agreements which are reviewed by the Board annually. 
Audited information
Directors’ remuneration
The Directors received the following remuneration during the year:
     Salary  Taxable  Pension Total Total 
     and fees Bonus benefits  contributions 2008 2007 
Name of Director     £ £ £ £ £ £
Executive
K Tozzi     123,917 15,000 7 ,987 11,500 158,404 667,306
F Begley     218,729 25,000 5,770 37 ,923 287,422 743,590
N Elton     145,500 15,000 4,249 13,667 178,416 65,309
Non-Executive
J Corsellis     10,000 – – – 10,000 14,671 
V Murria     35,000 – – – 35,000 8,750
C Hand
1
     76,500 – – – 76,500 16,666
      609,646 55,000 18,006 63,090 745,742 1,516,292
1 C Hand received £35,000 (2007: £5,000) for Non-Executive duties and £41,500 (2007: £11,666) for work in relation to the collaboration with Philips.  25
Concateno plc 
Annual Report and Accounts 2008
40 
60 
80 
100 
120 
140 
02/01/08
02/02/08
02/03/08
02/04/08
02/05/08
02/06/08
02/07/08
02/08/08
02/09/08
02/10/08
02/11/08
02/12/08
02/01/09
02/02/09
02/03/09
Concateno 
FTSE All Small 
FTSE Support Services 
Directors’ share options
Aggregate emoluments disclosed above do not include any amounts for the value of options to acquire ordinary shares in the Company granted 
to or held by the Directors under the EMI Share Option Scheme. Details of the options are as follows (see Note 24 of the accounts for 
performance conditions):
 
   At  Options Options Options At    
   1 January granted exercised lapsed 31 December Exercise Exercise Expiry 
Name of Director  Class 2008 Number Number Number 2008 price (p) date date
Executive
K Tozzi  A 50,000 –  – –  50,000 85.0 07/11/2009 07/11/2016
   B 49,999 –  – –  49,999 85.0 07/11/2009 07/11/2016
F Begley  A 50,000  – – – 50,000 85.0 07/11/2009 07/11/2016
   B 49,999  – – – 49,999 85.0 07/11/2009  07/11/2016
N Elton  C – 38,461 – – 38,461 130.0 21/01/2011 20/01/2018
   D – 38,462 – – 38,462 130.0 21/01/2011 20/01/2018
Non-Executive
J Corsellis   –  –  –  –  –
V Murria   –  –  –  –  – 
C Hand   –  –  –  –  –
Employee Benefit Trust
Aggregate emoluments disclosed above do not include any amounts for the value of Employee Benefit Trust Incentive Scheme (‘EBT’) ordinary 
shares in the Company granted to SG Hambros Trust Company (Channel Islands) Limited. SG Hambros Trust Company (Channel Islands) 
Limited, as trustee of a trust of which the Directors and certain of their relatives are potential beneficiaries, hold the following options and 
ordinary shares (see Note 24 to the accounts for performance conditions):
    Options/ Options/ Options/  
   At shares shares shares  At 
   1 January granted exercised lapsed 31 December Exercise Exercise Expiry 
Scheme  Class 2008 Number Number Number 2008 price (p) date date
EBT Share Option Scheme  A 700,000 – – – 700,000 86.0 07/11/2009 07/11/2016
EBT Share Option Scheme  B 700,002 – – – 700,002 86.0 07/11/2009 07/11/2013
EBT Share Option Scheme  E – 711,538 – – 711,538 142.0 12/06/201 1 12/06/2015
EBT Share Option Scheme   F – 711,539 – – 711,539 142.0 12/06/201 1 12/06/2015
EBT Share Scheme    2,980,047  – – –  2,980,047 N/A N/A N/A
Directors’ shareholdings
The Directors who served during the period, together with their beneficial interests in the shares of the Company, are detailed in the Directors’ 
Report on pages 18 to 20.
 
Performance graph
The graph below shows a comparison between the Company’s total shareholder return performance compared with FTSE AIM All Share and 
Support Service sectors of the London Stock Exchange. The graph covers the period from 1 January 2008 to 19 March 2009. The Directors 
have selected the Support Services sector as a comparison as they believe that the constituent companies most closely reflect the nature and 
operations of Concateno.
The market price of the Company’s shares as at 31 December 2008 was 93.5p and the range during the period between 1 January 2008 and 
31 December 2008 was 85.3p–170.30p. 
By order of the Board
Keith Tozzi
Chairman
30 March 2009 Concateno plc 
Annual Report and Accounts 2008 26
Statement of Directors’ Responsibilities in respect of the Annual Report   >
and the Financial Statements 
For the year ended 31 December 2008
The Directors are responsible for preparing the Annual Report and the Group and parent company financial statements, in accordance with 
applicable law and regulations.
 
Company law requires the Directors to prepare Group and parent company financial statements for each financial year. As required by the AIM 
Rules of the London Stock Exchange, they are required to prepare the Group Financial Statements in accordance with International Financial 
Reporting Standards (‘IFRSs’) as adopted by the EU and applicable law and have elected to prepare the parent company financial statements 
in accordance with UK Accounting Standards and applicable law (UK Generally Accepted Accounting Practice).
The Group Financial Statements are required by law and IFRSs as adopted by the EU to present fairly the financial position and the 
performance of the Group; the Companies Act 1985 provides in relation to such financial statements that references in the relevant part of that 
Act to financial statements giving a true and fair view are references to their achieving a fair presentation. 
The parent company financial statements are required by law to give a true and fair view of the state of affairs of the parent company. 
 
In preparing each of the Group and parent company financial statements, the Directors are required to: 
select suitable accounting policies and then apply them consistently; •	
make judgements and estimates that are reasonable and prudent; •	
for the Group Financial Statements, state whether they have been prepared in accordance with IFRSs as adopted by the EU; •	
for the parent company financial statements, state whether applicable UK Accounting Standards have been followed, subject to any material •	
departures disclosed and explained in the parent company financial statements; and 
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and the parent company •	
will continue in business.  
The Directors are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of 
the parent company and enable them to ensure that its financial statements comply with the Companies Act 1985. They have general 
responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and 
other irregularities. 
The Directors have decided to prepare voluntarily a Directors’ Remuneration Report in accordance with Schedule 7A to the Companies Act 
1985, as if those requirements were to apply to the Company. The Directors have also decided to prepare voluntarily a Corporate Governance 
Statement as if the Company were required to comply with the Listing Rules of the Financial Services Authority in relation to those matters.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website. 
Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.
By order of the Board
Fiona Begley
Chief Executive Officer
30 March 2009 27
Concateno plc 
Annual Report and Accounts 2008
To the members of Concateno plc
We have audited the group and parent company financial statements (the ‘financial statements’) of Concateno plc for the year ended 31 
December 2008 which comprise the Consolidated Income Statement, the Consolidated and Parent Company Balance Sheets, the 
Consolidated Cash Flow Statement, the Consolidated Statement of Recognised Income and Expense and the related notes. These financial 
statements have been prepared under the accounting policies set out therein. We have also audited the information in the Directors’ 
Remuneration Report that is being described as audited. 
This report is made solely to the Company’s members, as a body, in accordance with section 235 of the Companies Act 1985. Our audit work 
has been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor’s report 
and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company 
and the Company’s members as a body, for our audit work, for this report, or for the opinions we have formed. 
Respective responsibilities of Directors and auditors 
The Directors’ are responsible for preparing the Annual Report and the Group financial statements in accordance with applicable law and 
International Financial Reporting Standards (‘IFRSs’) as adopted by the EU, and for preparing the parent company financial statements in 
accordance with applicable law and UK Accounting Standards (UK Generally Accepted Accounting Practice) are set out in the Statement of 
Directors’ Responsibilities on page 26. 
Our responsibility is to audit the financial statements in accordance with relevant and regulatory requirements and International Standard on 
Auditing (UK and Ireland).
We report to you our opinion as to whether the financial statements give a true and fair view and whether the financial statements and the part 
of the Directors’ Remuneration Report to be audited give a true and fair view and whether the financial statements have been properly prepared 
in accordance with the Companies Act 1985. We also report to you whether in our opinion the information given in the Directors’ Report is 
consistent with the financial statements. The information given in the Directors’ Report includes that specific information presented in the 
Chairman’s Statement, Chief Executive’s Review and Financial Review that is cross referred from the Business Review section of the 
Directors’ Report.
In addition we report to you if, in our opinion, the Company has not kept proper accounting records, if we have not received all the information 
and explanations we require for our audit, or if information specified by law regarding Directors’ remuneration and other transactions is  
not disclosed. 
We read the other information contained in the Annual Report and consider whether it is consistent with the audited financial statements. We 
consider the implications for our report if we become aware of any apparent misstatements or material inconsistencies with the financial 
statements. Our responsibilities do not extend to any other information.
Basis of audit opinion 
We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing Practices Board. An audit 
includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements and the part of the Directors’ 
Remuneration Report to be audited. It also includes an assessment of the significant estimates and judgements made by the Directors in the 
preparation of the financial statements, and of whether the accounting policies are appropriate to the Group’s and Company’s circumstances, 
consistently applied and adequately disclosed. 
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us 
with sufficient evidence to give reasonable assurance that the financial statements and the part of the Directors’ Remuneration Report to be 
audited are free from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the 
overall adequacy of the presentation of information in the financial statements. 
Opinion 
In our opinion: 
the Group financial statements give a true and fair view, in accordance with IFRSs as adopted by the EU, of the state of the group’s affairs as at •	
31 December 2008 and of its loss for the year then ended; 
the parent company financial statements give a true and fair view, in accordance with UK Generally Accepted Accounting Practice, of the state •	
of the parent company’s affairs as at 31 December 2008; 
the financial statements and the part of the Directors’ Remuneration Report to be audited have been properly prepared in accordance with the •	
Companies Act 1985, and; 
the information given in the Directors’ Report is consistent with the financial statements. •	
KPMG Audit Plc
1 Forest Gate
Brighton Road
Crawley
RH11 9PT
Registered Auditor
30 March 2009
Independent Auditors’ Report  >
For the year ended 31 December 2008 Concateno plc 
Annual Report and Accounts 2008 28
Consolidated Income Statement >
For the year ended 31 December 2008
Consolidated Statement of Recognised Income and Expense >
For the year ended 31 December 2008
       Year ended  Year ended 
       31 December  31 December  
       2008  2007
      Notes £’000 £’000 £’000 £’000
Revenue      2  47,474  26,064
Cost of sales        (20,024)  (10,617)
Gross profit        27,450  15,447
Administrative expenses before the following items:     (16,003)  (10,055)
Non-recurring administrative expenses     3 (3,002)  (785)
Share-based payments       (555)  (439)
Amortisation of business combination intangible assets    11 (3,659)  (2,193)
Total administrative expenses        (23,219)  (13,472)
Operating profit      4  4,231  1,975
Finance income      7 76  380
Finance expenses      7 (3,366)  (2,032)
Exceptional charge in respect of interest hedge     7 (1,533)  –
Net fi nance costs        (4,823)  (1,652)
Profit/(loss) before taxation        (592)  323
Taxation      8  168  342
Profit/(loss) for the period attributable to equity shareholders of the Company    (424)  665
Earnings/(loss) per share      9
Basic (pence per share)        (0.43)p  1.05p
Diluted (pence per share)        (0.43)p  1.04p
The consolidated income statement has been prepared on the basis that all operations are continuing operations.
The accompanying notes are an integral part of the consolidated financial statements.
         Year ended Year ended 
         31 December 31 December  
         2008 2007 
        Notes £’000 £’000
Foreign currency translation differences for foreign operations      22 2,162 298
Changes in fair value of effective cash flow hedges      16  184 (184)
Income and expense recognised directly in equity       2,346 114
Profit/(loss) for the period         (424) 665
Total recognised income and expense for the period attributable to equity shareholders of the Company  1,922 779 29
Concateno plc 
Annual Report and Accounts 2008
Consolidated Balance Sheet >
As at 31 December 2008
         As at As at 
         31 December 31 December 
         2008 2007 
        Notes £’000 £’000
Assets
Non-current assets
Goodwill        11 98,335 97,938
Other intangible assets        11 43,426 46,183
Property, plant and equipment        12 3,691 3,410
Deferred tax assets         13 1,081 858
          146,533 148,389
Current assets
Inventories        14 4,935 3,855 
Current tax assets         204 1 74
Trade and other receivables        15 14,712 11,819 
Derivative fi nancial instruments        16 – 3 
Cash and cash equivalents        17 4,292 3,888
          24,143 19,739
Total assets         170,676 168,128
Liabilities
Current liabilities
Bank overdrafts        17 2,965 1,685
Loans and borrowings        18 25,110 3,931
Derivative element of convertible loan       18 – 417
Derivative fi nancial instruments        16 1,612 184
Current tax liabilities         1,438 1,281
Trade and other payables         20 9,729 8,892 
Provisions        21 1,120 1,541
          41,974  1 7,931
Non-current liabilities
Loans and borrowings        18 326 33,651 
Provisions        21 774 729 
Deferred tax liabilities        13 11,582 12,629 
          12,682 47,009
Total liabilities         54,656 64,940
Shareholders’ equity attributable to equity 
Shareholders of the Company
Share capital        22 10,614 9,530
Share premium account        22 99,146 89,875
Other reserves        22 10,304 7,958
Retained earnings        22 (4,044) (4,1 75)
Total shareholders’ equity attributable to equity shareholders of the Company     116,020 103,188
Total shareholders’ equity and liabilities        170,676 168,128
The financial statements were approved by the Board of Directors and authorised for issue on 30 March 2009. They were signed on its behalf by:
Fiona Begley    Neil Elton 
Chief Executive Officer   Finance Director
30 March 2009    30 March 2009
 
The accompanying notes are an integral part of the consolidated financial statements. Concateno plc 
Annual Report and Accounts 2008 30
Consolidated Cash Flow Statement >
For the year ended 31 December 2008
         Year ended Year ended 
         31 December 31 December  
         2008 2007 
        Note £’000 £’000
Cash flows from operating activities
Profit/(loss) for the period         (424) 665
Depreciation and other non-cash items:
Depreciation         1,238 569
Amortisation of intangible assets and loan issue costs       4,050 2,395 
Impairment losses on intangible assets        71 –
Impairment losses on property, plant and equipment       90 –
Share-based payments         555 439
Loss on disposal of property, plant and equipment       – (15)
Net fi nance costs         4,823 1,652
Taxation         (168) (342)
          10,235 5,363
Increase in trade and other receivables        (1,657) (247)
Increase in inventories         (156) (262)
Increase in trade and other payables        214 227
Cash generated from operations        8,636 5,081
Tax (paid)/received, net         (979) (33)
Net cash flows from operating activities        7,657 5,048
Cash flows from investing activities
Acquisitions of businesses (net of cash acquired)       (219) (101,613)
Purchase of property, plant and equipment        (1,771) (569)
Development expenditure         (1,129) (248)
Net cash flows from investing activities        (3,119) (102,430)
Cash flows from financing activities
Net proceeds from issue of share capital        – 71,454
Proceeds from exercise of share options        85 136
Proceeds from borrowings         – 29,722
Repayment of borrowings (net of debt issue costs)       (3,878) (1,250)
Interest received         75 133
Interest paid         (2,330) (1,264)
Net cash flow from financing activities        (6,048) 98,931
Increase/(decrease) in cash and cash equivalents for the period      (1,510) 1,549
Cash and cash equivalents at start of period        2,203 654
Effect of foreign exchange fluctuations on cash held       634 –
Cash and cash equivalents at end of period      17 1,327 2,203
The accompanying notes are an integral part of the consolidated financial statements. 31
Concateno plc 
Annual Report and Accounts 2008
Notes to the Consolidated Financial Statements >
For the year ended 31 December 2008
1 Accounting policies
Concateno plc (the ‘Company’) is a company domiciled in the United Kingdom. The consolidated financial statements of the Company as at 
and for the year ended 31 December 2008 comprise the Company and its subsidiaries (together referred to as the ‘Group’ or ‘Concateno’).
(a) Statement of compliance
The Group Financial Statements have been prepared and approved by the Directors in accordance with International Financial Reporting 
Standards as adopted by the EU (‘Adopted IFRSs’). The Company has elected to prepare its parent company financial statements in 
accordance with UK GAAP; these are presented on pages 61 to 64.
(b) Basis of preparation
Notwithstanding the Group’s net current liabilities of £17.8m as at 31 December 2008, the financial statements have been prepared on a Going 
Concern basis, which assumes that the Group will continue in operational existence for the foreseeable future, which the Directors believe is 
appropriate for the following reasons.
The Group term loan of £25.0m at 31 December 2008 is included within current liabilities as it is due to be repaid in full on 31 December 2009. 
As at 30 March 2009, the Group had not finalised the refinancing of that loan beyond the end of 2009.
However, the Directors have taken the following actions to support the basis of preparation:
Held discussions with a number of banks whose Credit Committees have agreed in principle to provide re-financing in full either individually •	
or in partnership. These banks have undertaken extensive due diligence.
Prepared projections for the results and cash flows of the Group for the next three years. These projections indicate that the Group will •	
continue to operate within the current agreed facilities covenants and the facilities and any covenants which the Directors expect to agree 
when the Group comes out of the current offer period. The Directors have considered the assumptions made and consider the forecasts to 
be reasonable and realistic.
The financial statements do not include any adjustments that would result from the going concern basis of preparation being inappropriate.
The accounting policies set out below have, unless otherwise stated, been applied consistently to all periods presented in these consolidated 
financial statements. These accounting policies are set out below and have been applied consistently throughout all periods. In these financial 
statements the following Adopted IFRSs are effective for the first time. Unless stated otherwise, they have not had a material effect on the 
financial statements:
IFRS 7 ‘Financial Instruments: Disclosures’ and the related amendment to IAS 1 ‘Presentation of Financial Statements’ in relation to capital •	
disclosures
IFRIC 8 ‘Scope of IFRS 2 Share-based Payment’. •	
IFRIC 9 ‘Reassessment of Embedded Derivatives’. •	
IFRIC 10 ‘Interim Financial Reporting and Impairment’. •	
IFRIC 11 ‘IFRS 2 – Group and Treasury Share Transactions’. •	
 
(c) Basis of measurement
The consolidated financial statements have been prepared on the historical cost basis except that derivative financial instruments are stated at 
fair value.
(d) Functional and presentational currency
The consolidated financial statements are presented in Pounds Sterling, which is the Company’s functional currency. All financial information 
presented in Pounds Sterling has been rounded to the nearest one thousand. 
(e) Basis of judgement
The preparation of financial statements requires management to make judgements, estimates and assumptions that affect the application of 
accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in 
which the estimate is revised and in any future periods affected.
In particular, information about significant areas of estimation, uncertainty and critical judgements in applying accounting policies that have the 
most significant effect on the amount recognised in the financial statements are described in the following notes:
Note 11 – Carrying amount of intangible assets and measurement of the recoverable amounts of cash generating units. Many intangible •	
assets have been valued using management’s best estimate of future cashflows expected to arise.
Note 11 – The Group invests in the development of future products and material enhancement of existing products in accordance with the •	
accounting policy. The assessment as to whether each element of this expenditure will be technically feasible, generate future economic 
benefit or the period over which to amortise the expenditure is a matter of judgement. The carrying value of product development capitalised 
and the amounts capitalised and amortised in the year are detailed in Note 11.
Note 13 – Utilisation of tax losses. The proportion of deferred tax assets recognised is a result of management’s best estimate of future  •	
profit streams. Concateno plc 
Annual Report and Accounts 2008 32
1 Accounting policies continued
Note 15 – Trade receivables provision. The value of provision made against bad or doubtful debts follows detailed customer-by-customer •	
review by management. The final provision arrived upon is a result of management’s best estimate of future recoverability and therefore 
involves a degree of judgement.
Note 21 – Provisions and contingencies. The value of provisions recognised in relation to ongoing enquiries is based on management’s best •	
estimate of total costs still to be incurred. Judgement is also involved in assessing the amount of deferred and contingent consideration to 
be recorded; amounts recognised are based on management’s assessment of the likelihood of warranties impacting final payments and 
expectation in relation to future performance conditions being met.
(f) Basis of consolidation
(i) Subsidiaries
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power, directly or indirectly, to govern the financial and 
operating policies of an entity so as to obtain benefits from its activities. In assessing control, potential voting rights that presently are 
exercisable or convertible are taken into account. The financial statements of subsidiaries are included in the consolidated financial statements 
from the date that control commences until the date that control ceases.
The accounting policies of subsidiaries have been changed when necessary to align them with the policies adopted by the Group. Applicable 
trading and market conditions have been considered in this process in order to ensure that the policies are still appropriate to that  
subsidiary’s situation.
 
(ii) Transactions eliminated on consolidation
Intra-group balances, and any unrealised gains and losses or income and expenses arising from intra-group transactions, are eliminated in 
preparing the consolidated financial statements.
(g) Foreign currency
(i) Foreign currency transactions
Transactions in foreign currencies are translated to the respective functional currencies of Group entities at the foreign exchange rate ruling at 
the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translated to Pounds 
Sterling at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in profit or loss. 
Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at 
the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are translated to 
Pounds Sterling at foreign exchange rates ruling at the dates the fair value was determined.
(ii) Group companies
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional 
currency different from the presentation currency are translated into the presentation currency as follows:
assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet; and •	
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 dates of the transactions).
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and 
translated at the closing rate.
Foreign currency differences are recognised directly in equity. Since 1 April 2006, the Group’s date of transition to IFRSs, such differences have 
been recognised in the foreign currency translation reserve. When a foreign operation is disposed of, in part or in full, the relevant amount in this 
reserve is transferred to profit or loss.
(h) Non-derivative financial instruments
Non-derivative financial instruments comprise investments in equity and debt securities, trade and other receivables, cash and cash equivalents 
(see Note (o) below), loans and borrowings, and trade and other payables.
Non-derivative financial instruments are recognised initially at fair value plus, for instruments not at fair value through profit or loss, any directly 
attributable transaction costs, except as described below. Subsequent to initial recognition non-derivative financial instruments are measured 
as described below.
A financial instrument is recognised if the Group becomes a party to the contractual provisions of the instrument. Financial assets are 
derecognised if the Group’s contractual rights to the cash flows from the financial assets expire or if the Group transfers the financial asset to 
another party without retaining control or substantially all risks and rewards of the asset. Regular way purchases and sales of financial assets 
are accounted for at trade date, i.e., the date that the Group commits itself to purchase or sell the asset. Financial liabilities are derecognised if 
the Group’s obligations specified in the contract expire or are discharged or cancelled.
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 33
Concateno plc 
Annual Report and Accounts 2008
1 Accounting policies continued
(i) Derivative financial instruments
The Group uses derivative financial instruments to hedge its exposure to foreign exchange and interest rate risks arising from operational, 
financing and investment activities. In accordance with its treasury policy, the Group does not hold or issue derivative financial instruments for 
trading purposes. However, derivatives that do not qualify for hedge accounting are accounted for as trading instruments. Derivative financial 
instruments are initially recognised at fair value of which the best estimate can be initial cost. The gain or loss on re-measurement to fair value is 
recognised immediately in profit or loss. However, where derivatives qualify for hedge accounting, recognition of any resultant gain or loss 
depends on the nature of the item being hedged. The fair value of interest rate swaps is the estimated amount that the Group would receive or 
pay to terminate the swap at the balance sheet date, taking into account current interest rates and the current creditworthiness of the swap 
counterparties. The fair value of forward exchange contracts is their quoted market price at the balance sheet date, being the present value of 
the quoted forward price.
(i) Cash flow hedges
When a derivative financial instrument is designated as a hedge of the variability in cash flows of a recognised asset or liability, or a highly 
probable forecasted transaction, the effective part of any gain or loss on the derivative financial instrument is recognised directly in equity. When 
the forecasted transaction subsequently results in the recognition of a non-financial asset or non-financial liability, or the forecast transaction for 
a non-financial asset or non-financial liability the associated cumulative gain or loss is removed from equity and included in the initial cost or 
other carrying amount of the non-financial asset or liability. If a hedge of a forecasted transaction subsequently results in the recognition of a 
financial asset or a financial liability, then the associated gains and losses that were recognised directly in equity are reclassified into profit or 
loss in the same period or periods during which the asset acquired or liability assumed affects profit or loss (i.e. when interest income or 
expense is recognised).
For cash flow hedges, other than those covered by the preceding two policy statements, the associated cumulative gain or loss is removed 
from equity and recognised in profit or loss in the same period or periods during which the hedged forecast transaction affects profit or loss. 
The ineffective part of any gain or loss is recognised immediately in profit or loss. 
When a hedging instrument expires or is sold, terminated or exercised, or the entity revokes designation of the hedge relationship but the 
hedged forecast transaction still is expected to occur, the cumulative gain or loss at that point remains in equity and is recognised in 
accordance with the above policy when the transaction occurs. If the hedged transaction is no longer expected to take place, then the 
cumulative unrealised gain or loss recognised in equity is recognised immediately in profit or loss.
(ii) Hedge of monetary assets and liabilities
When a derivative financial instrument is used as an economic hedge of the foreign exchange exposure of a recognised monetary asset or liability, 
hedge accounting is not applied and any gain or loss on the hedging instrument is recognised as part of foreign currency gains and losses.
(j) Compound financial instruments
The Group had Convertible loan notes which are regarded as compound financial instruments, consisting of a liability component and a 
derivative component. At the date of issue, the fair value of the liability component is established using an estimate for a similar non-convertible 
debt. The difference between the proceeds of issue of the convertible debt and the fair value assigned to the debt component, representing the 
embedded option to convert the debt, is included as a separate component of liabilities (‘derivative element of convertible loan’) unless it fully 
meets the definition of equity (in which case, it is charged directly in equity),
Any issue costs are apportioned between the liability and derivative components of the convertible loan notes based on the relative carrying 
amounts at the date of issue. The portion relating to the derivative component is not re-measured subsequent to initial recognition.
The interest expense on the debt component consists of the coupon rate and the element of the derivative component proportionate to the 
debt component outstanding. This latter part is added to the carrying amount of the convertible loan notes.
(k) Property, plant and equipment
(i) Owned assets
Items of property, plant and equipment are stated at cost less accumulated depreciation (see below) and impairment losses (see accounting 
policy q). When parts of an item of property, plant and equipment have different useful lives, those components are accounted for as separate 
items of property, plant and equipment.
(ii) Leased assets
Leases in terms of which the Group assumes substantially all of the risks and rewards of ownership are classified as finance leases.
(iii) Subsequent costs
The Group recognises in the carrying amount of an item of property, plant and equipment the cost of replacing part of such an item when that 
cost is incurred if it is probable that the future economic benefits embodied within the item will flow to the Group and the cost of the item can be 
measured reliably. All other costs are recognised in profit or loss as an expense as incurred. Concateno plc 
Annual Report and Accounts 2008 34
1 Accounting policies continued
(iv) Depreciation
Depreciation is charged to profit or loss on a straight-line basis over the estimated useful lives of each part of an item of property, plant and 
equipment. The estimated useful lives are as follows:
Leasehold buildings  – over the remaining life of the lease •	
Plant and equipment – 3–10 years •	
The residual value, depreciation method and useful lives are reassessed annually.
(l) Intangible assets
(i) Goodwill
All business combinations are accounted for by applying the purchase method. Goodwill has been recognised in acquisitions of subsidiaries. 
Goodwill represents the difference between the cost of the acquisition and the fair value of the net identifiable assets acquired.
Goodwill is stated at cost less any accumulated impairment losses. Goodwill is allocated to cash-generating units and is no longer amortised 
but is tested annually for impairment (see accounting policy q).
(ii) Research and development
Expenditure on research activities undertaken with the prospect of gaining new scientific or technical knowledge and understanding, is 
recognised in profit or loss as an expense as incurred.
Development activities involve a plan or design for the production of new or substantially improved products and processes. Development 
expenditure is capitalised only if development costs can be measured reliably, the product or process is technically and commercially feasible, 
future economic benefits are probable, and the Group intends, and has sufficient resources, to complete development and to use or sell the 
asset. The expenditure capitalised includes the cost of materials, direct labour and an appropriate proportion of direct overheads. Other 
development expenditure is recognised in the income statement as an expense as incurred. 
Capitalised development expenditure is stated at cost less accumulated amortisation (see below) and impairment losses (see accounting 
policy q).
(iii) Other intangible assets
Intangible assets other than goodwill that are acquired by the Group are stated at cost less accumulated amortisation (see below) and 
impairment losses (see accounting policy q). Other intangible assets include customer relationships and brands. Expenditure on internally 
generated goodwill and brands is recognised in profit or loss as an expense as incurred.
(iv) Subsequent expenditure
Subsequent expenditure on capitalised intangible assets is capitalised only when it increases the future economic benefits embodied in the 
specific asset to which it relates. All other expenditure is expensed as incurred.
(v) Amortisation
Amortisation is charged to profit or loss on a straight-line basis over the estimated useful lives of intangible assets once they are available for 
use. Goodwill with an indefinite useful life is tested systematically for impairment at each annual balance sheet date. The estimated useful lives 
of intangible assets are as follows:
Customer relationships  – 7–20 years •	
Customer contracts  – 7–10 years •	
Commercial agreements  – 10–12 years •	
Patents and trademarks  – 10–20 years •	
Capitalised development costs  – 3–5 years •	
(m) Trade and other receivables
Trade and other receivables are initially measured on the basis of their fair value. Subsequently they will be carried at amortised cost using the 
effective interest method less any impairment losses (see accounting policy q).
(n) Inventories
Inventories are stated at the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of 
business, less the estimated costs of completion and selling expenses.
(o) Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with an original maturity of three months or less. Any bank overdrafts that 
are repayable on demand and form an integral part of the Group’s cash management are included as a component of cash and cash 
equivalents for the purpose of the statement of cash flows.
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 35
Concateno plc 
Annual Report and Accounts 2008
1 Accounting policies continued
(p) Provisions
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events; it is more likely than not that 
an outflow of resources will be required to settle the obligations; and, the amount can be reasonably estimated. Provisions are split between 
current and non-current liabilities, where appropriate, provisions are calculated by discounting the expected future cash flows at a pre-tax rate 
that reflects market assessments of the time value of money and the risks specific to the liability.
(q) Impairment (excluding inventories and deferred tax assets)
The carrying amounts of the Group’s assets are reviewed at each balance sheet date to determine whether there is any indication of 
impairment. If any such indication exists, the asset’s recoverable amount is estimated. 
For goodwill, assets that have an indefinite useful life and intangible assets that are not yet available for use, the recoverable amount is 
estimated at each balance sheet date.
An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. 
Impairment losses are recognised in the income statement.
Impairment losses recognised in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to 
cash-generating units and then to reduce the carrying amount of the other assets in the unit on a pro rata basis. A cash generating unit is the 
smallest identifiable group of assets that generates cash inflows that are largely independent of the cash inflows from other assets or groups  
of assets.
At the date of transition to Adopted IFRSs, no business combinations had been effected and the Company held no intangible assets or assets 
which had an indefinite useful life. 
When a decline in the fair value of an available-for-sale financial asset has been recognised directly in equity and there is objective evidence that 
the asset is impaired, the cumulative loss that had been recognised directly in equity is recognised in profit or loss even though the financial 
asset has not been derecognised. The amount of the cumulative loss that is recognised in profit or loss is the difference between the 
acquisition cost and current fair value, less any impairment loss on that financial asset previously recognised in profit or loss.
 
(i) Calculation of recoverable amount
The recoverable amount of the Group’s receivables carried at amortised cost are calculated as the present value of estimated future cash flows, 
discounted at the original effective interest rate (i.e., the effective interest rate computed at initial recognition of these financial assets). 
Receivables with a short duration are not discounted.
The recoverable amount of other assets is the greater of their net selling price and value in use. 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. For an asset that does not generate largely independent cash inflows, the recoverable amount is 
determined for the cash-generating unit to which the asset belongs.
(ii) Reversals of impairment
An impairment loss in respect of a receivable carried at amortised cost is reversed if the subsequent increase in recoverable amount can be 
related objectively to an event occurring after the impairment loss was recognised.
An impairment loss in respect of goodwill is not reversed. 
In respect of other assets, an impairment loss is reversed when there is an indication that the impairment loss may no longer exist and there has 
been a change in the estimates used to determine the recoverable amount.
An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been 
determined, net of depreciation or amortisation, if no impairment loss had been recognised.
(r) Non-recurring items
The Group presents as non-recurring items on the face of the income statement those material items of income and expenditure which 
because of their nature and/or expected infrequency of the events giving rise to them, merit separate presentation to allow shareholders to 
understand the elements of financial performance in the period, so as to facilitate comparison with prior periods. Concateno plc 
Annual Report and Accounts 2008 36
1 Accounting policies continued
(s) Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at fair value less attributable transaction costs. Subsequent to initial recognition, interest-
bearing borrowings are stated at amortised cost with any difference between cost and redemption value being recognised in profit or loss over 
the period of the borrowings on an effective interest basis.
(t) Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a 
substantial period of time to get ready for their intended use of sale, are added to the cost of those assets, until such time as the assets are 
substantially ready for their intended use or sale.
All other borrowing costs are recognised in the income statement in the period in which they are incurred.
(u) Employee benefits
(i) Defined contribution plans
Obligations for contributions to defined contribution pension plans are recognised as an expense in profit or loss as incurred.
(ii) Share-based payment transactions
The share option programme allows Group employees to acquire shares of the Company. The fair value of options granted is recognised as an 
employee expense with a corresponding increase in equity. The fair value is measured at grant date and spread over the period during which 
the employees become unconditionally entitled to the options. The fair value of the options granted is measured using a binomial lattice model, 
taking into account the terms and conditions upon which the options were granted. The amount recognised as an expense is adjusted to reflect 
the actual number of share options that vest except where forfeiture is only due to share prices not achieving the threshold for vesting.
(v) Revenue
(i) Goods sold 
Revenue represents the amounts receivable for goods provided less trade discounts, returns and allowances, VAT and other sales  
related taxes.
The Group records transactions as sales when the significant risks and rewards have been transferred to the buyer in accordance with the 
terms of trade. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due, associated costs or 
the possible return of goods. 
Transfer of risks and rewards vary depending on the individual terms of the contract of sale. For the majority of ‘Point-of-Care testing’ and 
‘Laboratory Product’ sales, transfer usually occurs when the product is received at the customer’s site; however, for some international 
shipments, transfer occurs upon loading goods onto the relevant carrier.
A bill and hold arrangement is in place with one UK customer for whom the Group stores the customers finished product, on their request, and 
arranges delivery as and when they require it. Revenue is recognised when substantially all the risks and rewards of ownership have been 
transferred to the buyer, even though it has not all been dispatched to the customer’s site(s).
Income received in advance of the provision of goods is held in deferred income within the balance sheet until those goods have  
been delivered.
(ii) Services rendered
The Group provides services chiefly in respect of its ‘Laboratory Services’ division. Revenue represents the amounts receivable for services 
provided less trade discounts, returns and allowances, VAT and other sales related taxes.
The Group records transactions as sales when the performance of services has taken place in accordance with the terms of trade. No revenue 
is recognised if there are significant uncertainties regarding recovery of the consideration due or associated costs. 
Income received in advance of the provision of services is held in deferred income within the balance sheet until those services have  
been provided.
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 37
Concateno plc 
Annual Report and Accounts 2008
1 Accounting policies continued
(w) Expenses
(i) Operating lease payments
Payments made under operating leases are recognised in profit or loss on a straight-line basis over the term of the lease. Lease incentives 
received are recognised in the income statement as an integral part of the total lease expense.
(ii) Finance lease payments
Minimum lease payments are apportioned between the finance charge and the reduction of the outstanding liability. The finance charge is 
allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.
(iii) Finance costs
Financing costs comprise interest payable on borrowings calculated using the effective interest rate method, interest receivable on funds 
invested foreign exchange gains and losses, and gains and losses on hedging instruments that are recognised in profit or loss.
Interest income is recognised in profit or loss as it accrues, using the effective interest method. The interest expense component of finance 
lease payments is recognised in the income statement using the effective interest rate method.
(x) Income tax
Income tax comprises current and deferred tax. Income tax is recognised in the income statement except to the extent that it relates to items 
recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the balance 
sheet date, and any adjustment to tax payable in respect of previous years.
Deferred tax is provided using the balance sheet liability method, providing for temporary differences between the carrying amounts of assets 
and liabilities for financial reporting purposes and the amounts used for taxation purposes. The following temporary differences are not 
provided for: initial recognition of goodwill, the initial recognition of assets or liabilities in a transaction that is not a business combination that 
affect neither accounting nor taxable profit, and differences relating to investments in subsidiaries to the extent that they will probably not 
reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the 
carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be 
utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.
(y) Adopted IFRSs not yet applied
At the date of authorisation of these financial statements, the following standards and interpretations which have not been applied in these 
financial statements were in issue but not yet effective:
 
IFRS 8 Operating segments. •	
IFRS 2 Amendment – Share-based Payment: Vesting Conditions and Cancellations. •	
IFRS 3 Amendment – Business Combinations. •	
IAS 1 Amendment – Presentation of Financial Statements. •	
IAS 23 Amendment – Borrowing costs. •	
IAS 27 Amendment – Consolidated and Separate Financial Statements. •	
IAS 32 Amendment – Financial Instruments: Presentation. •	
IFRIC 12 Service Concession Arrangement. •	
IFRIC 13 Customer Loyalty Programmes. •	
IFRIC 14 The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their interaction. •	
 
The Directors do not anticipate that the adoption of any of the above standards or interpretations will have a material impact on the Group’s 
accounts in the period of initial application. However, there may be amendments to these disclosures following completion of the internal review 
exercise currently under way in respect of IFRS 8 ‘Operating segments’.
2 Segmental information
A segment is a distinguishable component of the Group that is engaged either in providing products or services (business segment), or in 
providing products or services within a particular economic environment (geographical segment), which is subject to risks and rewards that are 
different from those of other segments. The primary format, business segments, is based on the Group’s management and internal reporting 
structure. Inter-segment pricing is determined on an arm’s length basis.
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable 
basis. Unallocated items comprise mainly loans and borrowings and related expenses, corporate assets and head office expenses, and income 
tax assets and liabilities. Concateno plc 
Annual Report and Accounts 2008 38
2 Segmental information continued
Business segments
The Group comprises the following main business segments:
Laboratory services. •	
Point-of-Care testing products. •	
Laboratory products. •	
Other revenues include training and consultancy work performed for workplace customers. These revenues have been allocated to ‘Point-of-
Care’ and ‘Laboratory services’ in proportion to other work performed for these particular customers.
Results, split by business segment, are presented below.
 
  Laboratory Services   Point-of-Care  Laboratory Products  Eliminations  Consolidated
 2008 2007 2008 2007 2008 2007 2008 2007 2008  2007 
 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000  £’00
Total external revenues 24,064 19,080 12,878 4,470 10,532 2,514 – – 47,474 26,064
Inter segment revenues 700 342 1,493 396 105 11 (2,298) (749)  – -
Total segment revenues 24,764 19,422 14,371 4,866 10,637 2,525  (2,298) (749) 47,474 26,064
Segment result, before  
non-recurring items 6,415 3,1 7 4 2,216 502 1,272 139 – –  9,903 3,815
Non-recurring items (1,546) (568) (471) (20) (99) – – –  (2,116) (588)
Segment result, after  
non-recurring items 4,869 2,606 1,745 482 1,173 139 – – 7,787 3,227
Unallocated (including  
non-recurring) expenses         (3,556) (1,252)
Results from operating 
activities         4,231 1,975
Net finance costs  
(including exceptional  
fi nance costs)         (4,823) (1,652)
Income tax credit         168 342
Profit/(loss) for the period         (424) 665
Non-recurring and  
exceptional items         4,535 785
Profit/(loss) for the 
period before 
non-recurring and 
exceptional items         4,111  1,450
Segment assets 84,001 80,705 65,864 59,440 20,477 26,383 – – 170,342 166,528
Unallocated assets         334 1,600
Total assets         170,676 168,128
Segment liabilities 13,263 11,264 8,524 8,166 3,790 4,434 – – 25,577 23,864
Unallocated liabilities           29,079 41,076
Total liabilities         54,656 64,940
Property, plant and  
equipment (‘PPE’)  
expenditure  1,302 385 267 65 82 10 – – 1,651 460
Unallocated PPE expenditure         3 109
Total PPE capital expenditure         1,654 569
Depreciation 531 464 488 81 206 19 – – 1,225 564
Unallocated depreciation         13 5
Total Depreciation         1,238 569
Amortisation of  
intangible assets 1,725 1,478 1,665 640 430 115 – –  3,820 2,233 
Intangible asset additions, by business segment, are disclosed in Note 11.
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 39
Concateno plc 
Annual Report and Accounts 2008
2 Segmental information continued
Geographical segments
The Group’s business segments are managed on a worldwide basis, but operate in two principal geographical areas; the United Kingdom and 
Continental Europe (defined here as all European countries apart from the United Kingdom). Continental Europe production facilities/sales 
offices are located in Spain (predominantly operating in the Laboratory Products business segment), Sweden (Laboratory Services and 
Point-of-care testing products) and Italy (Point-of-care testing products). 
In presenting information on the basis of geographical segments, segment revenue is based on the geographical location of customers. This is split 
between the United Kingdom, Continental Europe and ‘Rest of World’. Within ‘Rest of World’ are a high proportion of customers who are based in 
South America. Segment assets and capital expenditure are based on the geographical location of the assets. 
 
   United Kingdom    Continental Europe   Rest of World  Consolidated
   2008 2007 2008 2007 2008 2007 2008  2007 
   £’000 £’000 £’000 £’000 £’000 £’000 £’000  £’000
Revenue from external customers    28,331 18,201 10,723  4,982 8,420 2,881 47,474 26,064
Segment assets   154,768 149,804 15,908  18,324 – – 170,676 168,128
Capital expenditure   1,564 506 90 63  – – 1,654  569
3 Non-recurring items
         2008 2007 
         £’000 £’000
Restructuring: Employee costs         1,290 375
Restructuring: Consultancy costs         247 –
Restructuring: Onerous rent         445 –
Restructuring: Other operating costs        197 24
Legal and advisory         662 386
Impairment charge         161 –
          3,002 785
Restructuring
Following the various acquisitions during 2007, the Company reviewed the operating structure of the business, as a result of which £1,290,000 
(2007: £375,000) was incurred in redundancy and employee integration costs, £247,000 in consultancy, recruitment agency and advisory fees 
(2007: £nil) and £197,000 (2007: £24,000) on other one-off restructuring costs associated with the rationalisation of the Group’s laboratories and 
restructuring of the sales and marketing structure. 
Following the closure of a number of sites across the Group, the delay in sub-letting a number of premises has led to onerous rental costs of 
£445,000 (2007: £nil) being incurred. This includes an onerous lease provision of £382,000 held as at 31 December 2008.
Legal and advisory 
The non-recurring legal and advisory costs relate to non-routine professional costs incurred during the period:
£25,000 of costs relate to one legal case which is on-going. This provision represents the excess insurance costs to be paid should the case 
proceed. In 2007, £20,000 of unrecoverable costs were incurred in relation to two legal cases involving former Group employees. In neither 
case were charges upheld against the Group. 
£75,000 (2007: £169,000) relates to costs and advisory fees relating to tax enquiries by HMRC that are non-recurring in nature. £285,000  
(2007: £nil) was incurred in relation to one-off bank fees. In 2007, £54,000 related to external advice given in relation to the transition to 
International Financial Reporting Standards and the review of that advice.
£277,000 (2007: £143,000) relates to charges incurred on completed acquisitions that have not been included as part of the cost of acquisition, 
or to fees incurred relating to exploratory work on acquisitions that were not progressed during the year, or to fees in relation to the on-going 
strategic review process announced in July 2008.
Impairment charge
Following an impairment review, the value of one particular intangible asset acquired as part of the Cozart acquisition was found to be impaired 
as at 31 December 2008. One particular customer contract with a carrying value of £71,000 was written-off in the period as a result (2007: £nil).
Following a revaluation of a property owned by the Group, the carrying value of the property was written down by £90,000 as at the end of 
2008 (2007: £nil)  Concateno plc 
Annual Report and Accounts 2008 40
4 Operating profit
Profit for the year has been arrived at after charging/(crediting):
         2008 2007 
         £’000 £’000
Net foreign exchange gains         (815) (85)
Research and development costs         382 59
Depreciation of property, plant and equipment        1,283 757
Amortisation of 
– capitalised development costs         161 40
– other intangible assets          3,659 2,193
– debt issue costs          230 162
Loss on disposal of fixed assets         – 16
Restructuring costs (included in ‘non-recurring costs’, see Note 3)      2,179 399
(Decrease)/Increase in provisions (see Note 21)        (376) 2,270
Staff costs (see Note 6)         11,639 7,533
5 Auditors remuneration
The analysis of auditors’ remuneration is as follows:
         2008 2007 
         £’000 £’000
Audit of these financial statements         50 82
Audit of financial statements of subsidiaries pursuant to legislation      134 148
Other services relating to taxation         140 61
Services relating to corporate finance transactions entered into or proposed   
 to be entered into by or on behalf of the Company of the Group      85 443
Other services         8 7
          417 741
Amounts paid to the Company’s auditor in respect of services to the Company, other than the audit of the Company’s financial statements, 
have not been disclosed as the information is required instead to be disclosed on a consolidated basis.
6 Staff costs and numbers
The average monthly number of employees (including Directors) for the Group during the year, analysed by category, was:
         2008 2007 
         Number Number
Production and development         88 27
Laboratory services         83 66
Sales, marketing and distribution         49 39
Administration         118 70
          338 202
Their aggregate remuneration comprised:
         2008 2007 
         £’000 £’000
Wages and salaries         9,366 6,305
Share based payments         555 439
Social security costs         1,283 612
Other pension costs         435 177
          11,639 7,533
Details regarding Director’s Remuneration is included within the Director’s Remuneration Report on pages 24 to 25.
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 41
Concateno plc 
Annual Report and Accounts 2008
7 Finance income and expense
         2008 2007 
         £’000 £’000
Interest income         76 377
Interest expense on bank loans and overdrafts        (3,259) (2,007)
Ineffective portion of change in fair value of cashflow hedges       (82) 3
Finance charges in respect of finance leases and hire purchase contracts      (25) (25)
          (3,290) (1,652)
Exceptional charge in respect of interest hedge        (1,533) –
          (4,823) (1,652)
A charge of £1,533,000 (2007: £nil) has been recognised in respect of the fair valuation of a derivative financial instrument previously designated 
as an effective hedge. This total charge comprises £184,000 previously recognised in equity and £1,349,000 current year change in fair value. 
Under IAS 39, effectiveness testing is undertaken to ascertain whether changes in the fair value of the hedged item are offset by changes in the 
fair value of the hedging instrument within a range of 80–125%. The interest rate hedge, details of which are set out in Note 19, as at 31 
December 2008 is outside this range and therefore the full charge has been recognised in the Income Statement.
8 Taxation
Recognised in the Income Statement:
         2008 2007 
         £’000 £’000
Current tax:
UK current year tax expense         951 439
Foreign current year tax expense         331 60
Adjustment in respect of prior periods        (179)  (351) 
          1,103 148
Deferred tax:
Origination and reversal of temporary timing differences       (1,053) (251)
Adjustment due to 2008 rate change        – (239)
Adjustment in respect of previous periods        (218) –
          (1,271) (490)
Total tax in the income statement        (168) (342)
Reconciliation of effective tax rate:
The tax charge for the period is lower than the standard rate of corporation tax in the UK (28.5%). The differences are explained below:
Profi t/(loss) before tax         (592)  323
Tax using the UK corporation tax rate of 28.5% (2007: 30%)       (169) 97
Non-deductible expenses         459 240
R&D tax relief         (145) (82)
Prior period adjustments         (396) (351)
Tax losses carried forward         124 4
Other tax reliefs         – (20)
(Lower)/Higher tax rate on overseas earnings        (41) 9
Adjustment due to 2008 rate change        – (239)
Total tax in the income statement        (168) (342)
Income tax recognised directly in equity:
Relating to share-based payments         – 13
Total tax recognised directly in equity        – 13 Concateno plc 
Annual Report and Accounts 2008 42
9 Earnings/(loss) per share
Earnings/(loss) per share is calculated by dividing the profit/(loss) attributable to ordinary shareholders by the weighted average number of 
ordinary shares held during the year.
An adjusted earnings per share figure is also presented below in order to aid users understanding of underlying business performance. This is 
calculated by adjusting the profit/(loss) for the year for the post-tax effect of certain items which, the Directors believe, will allow shareholders to 
better understand the elements of financial performance in the period, so as to facilitate comparison with prior periods.
         Basic  Basic  
         and diluted and diluted 
         2008 2007 
        Notes £’000 £’000
For basic and diluted earnings/(loss) per share
Profit/(loss) for the year         (424) 665
For adjusted earnings per share
 add back intangibles amortisation (post-tax)       11 2,634 1,579
 add back non-recurring and exceptional costs (post-tax)      3 3,444 736
 add back share-based payments  (post-tax)       22 555 357
Adjusted profit for the year         6,209 3,337
Weighted average number of ordinary shares
For basic earnings/(loss) per share         98,054,022 63,020,125
Exercise of share options         –
1
 912,274
Exercise of warrants         –
1
 187,309
For diluted earnings/(loss) per share        98,054,022 64,119,708
Basic earnings/(loss) per share (pence per share)       (0.43p) 1.05p
Diluted earnings/(loss) per share (pence per share)       (0.43p) 1.04p
Reconciliation to adjusted earnings per share: Basic  
Impact of intangibles amortisation         2.69p 2.50p
Impact of non-recurring and exceptional costs        3.51p 1.1 7p
Impact of share-based payments         0.57p 0.57p
Adjusted basic earnings per share (pence per share)       6.34p 5.29p
Reconciliation to adjusted earnings per share: Diluted
1
  
Impact of intangibles amortisation         2.66p 2.45p
Impact of non-recurring and exceptional costs        3.47p 1.15p
Impact of share-based payments         0.56p 0.56p
Adjusted diluted earnings per share (pence per share)       6.26p 5.20p
1   In 2008, the dilutive impact of options over 1,081,702 shares would have formed part of the dilutive calculation but were not included because of the loss-making position of the 
Company. However, the dilutive impact of these options (comprising 822,108 share options and 259,594 warrants) still impacts the adjusted dilutive calculation, due to the adjusted 
profit-making position of the Company.
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 43
Concateno plc 
Annual Report and Accounts 2008
10 Acquisitions 
During 2007, the Company acquired six companies. Details of finalised fair values in relation to each business combination are presented in 
note (i) to (vi) below.
(i) Acquisition of Altrix Healthcare plc
On 5 February 2007, the Group acquired all the shares in Altrix Healthcare plc (‘Altrix’), based in Warrington, at fair value for £14,846,527 in cash 
(including acquisition costs and payment for cash acquired). The Company specialises in the provision of drug testing solutions.
From the date of acquisition, Altrix contributed £131,000 of profit after tax to the Group in 2007.
The finalised fair value of net assets acquired was as follows:
         Altrix Altrix 
        Altrix fair value fair value to 
        Book value adjustment the Group 
        £’000 £’000 £’000
Property, plant and equipment         455 – 455
Intangible assets        – 5,045 5,045
Inventories        302 – 302
Trade and other receivables        2,101 – 2,101
Cash and cash equivalents        2,434 – 2,434
Trade and other payables        (1,479) (6) (1,485)
Deferred tax        – (1,514) (1,514)
Net identifiable assets and liabilities       3,813 3,525 7,338
Goodwill on acquisition          7,509
Total purchase cost          14,847
Being: Consideration paid in cash          13,615
   Cash paid for acquisition expenses         1,232
           14,847
Cash acquired          (2,434)
Net cash outflow in respect of purchase         12,413
Acquisition expenses include £300,000 completion bonus paid to Directors.
The fair value adjustments above relate to recognition of intangible assets acquired as part of the business combination (£5,045,000), a holiday 
accrual at the date of acquisition (£6,000), and recognition of the deferred tax liability relating to intangible assets acquired (£1,514,000).
See Note 11 for details of intangible assets identified on acquisition. The remaining goodwill is chiefly attributable to the value of the customer 
base and non-contractual customer relationships which do not fulfil the intangible assets recognition criteria under IFRSs, the profitability of the 
business and the significant synergies expected to arise after acquisition.
(ii) Acquisition of TrichoTech Limited
On 31 January 2007, the Group acquired all the shares in TrichoTech Limited (‘TrichoTech’), based in Cardiff, at fair value for £1,337,000 in cash 
(including acquisition costs), £1,062,500 in shares and £9,012,500 in loan notes. The Company provides laboratory-based hair testing services 
for recreational drug abuse.
From the date of acquisition, TrichoTech contributed £491,000 of profit after tax to the Group in 2007. Concateno plc 
Annual Report and Accounts 2008 44
10 Acquisitions continued
The finalised fair value of net assets acquired was as follows:
         TrichoTech TrichoTech 
        TrichoTech fair value fair value to 
        Book value adjustment the Group 
        £’000 £’000 £’000
Property, plant and equipment         577 – 577
Intangible assets        – 3,300 3,300
Inventories        39 – 39
Trade and other receivables        698 – 698
Cash and cash equivalents        250 – 250
Interest-bearing loans and borrowings       (309) – (309)
Trade and other payables        (915) (4) (919)
Deferred tax        (23) (990) (1,013)
Net identifiable assets and liabilities       317 2,306 2,623
Goodwill on acquisition          8,789
Total purchase cost          11,412
Consideration paid in shares (817,308 shares at 130p)        (1,063)
Consideration paid on loan notes          (9,012)
Payments in cash          1,337
Being: Consideration paid in cash          673
   Cash paid for acquisition expenses         664
           1,337
Cash acquired          (249)
Net cash outflow in respect of purchase         1,088
    
Acquisition expenses include £150,000 completion bonus paid to Directors.
The fair value adjustments above relate to recognition of intangible assets acquired as part of the business combination (£3,300,000), a holiday 
accrual at the date of acquisition (£4,000), and recognition of the deferred tax liability relating to intangible assets acquired (£990,000).
The loan notes were redeemed in December 2007 (£9,012,000).
See Note 11 for details of intangible assets identified on acquisition. The remaining goodwill is chiefly attributable to the profitability of the 
business, the assembled workforce, its market-leading position in the field of hair testing and the significant synergies expected to arise  
after acquisition.
(iii) Acquisition of Euromed Limited
On 30 March 2007, the Group acquired all the shares in Euromed Limited (‘Euromed’), based in London, at fair value for £8,758,000 in cash 
(including acquisition costs) and £3,750,000 in shares. The Company provides Point-of-Care testing devices for the detection of drugs of abuse 
primarily in the criminal justice and rehabilitation sectors.
From the date of acquisition, Euromed contributed £277,000 of profit after tax to the Group in 2007.
The finalised fair value of net assets acquired was as follows:
         Euromed Euromed 
        Euromed fair value fair value to 
        Book value adjustment the Group 
        £’000 £’000 £’000
Property, plant and equipment         12 – 12
Intangible assets        – 6,138 6,138
Inventories        597 (417) 180
Trade and other receivables        572 – 572
Cash and cash equivalents        152 – 152
Trade and other payables        (585) – (585)
Deferred tax        – (1,842) (1,842)
Net identifiable assets and liabilities       748 3,879 4,627
Goodwill on acquisition          7,881
Total purchase cost          12,508
Consideration paid in shares (2,586,207 shares at 145p)        (3,750)
Payments in cash          8,758
Being: Consideration paid in cash          7 ,750
   Cash paid for acquisition expenses         1,008
           8,758
Cash acquired          (152)
Net cash outflow in respect of purchase         8,606
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 45
Concateno plc 
Annual Report and Accounts 2008
10 Acquisitions continued
Acquisition expenses include £250,000 completion bonus paid to Directors.
The fair value adjustments above relate to recognition of intangible assets acquired as part of the business combination (£6,138,000) an 
opening provision for the revaluation of stock (£422,000), an amendment to the valuation of stock to bring Euromed in line with Group policy 
relating to the absorption of relevant overheads in the closing value of stock held (£5,000) and an opening provision for recognition of deferred 
taxation on intangible assets acquired (£1,842,000).
See Note 11 for details of intangible assets identified on acquisition. The remaining goodwill is chiefly attributable to the profitability of the 
business, the assembled workforce and the significant synergies expected to arise after acquisition.
(iv) Acquisition of Marconova AB
On 22 May 2007, the Group acquired all the shares in Marconova AB (‘Marconova’), based in Goteborg, Sweden, at fair value for £425,000 in 
cash and £1,000,000 in shares. The Company is a specialist in drug and alcohol testing in the international maritime sector and the Swedish 
workplace market.
From the date of acquisition, Marconova contributed £121,000 of loss after tax to the Group in 2007.
The finalised fair value of net assets acquired was as follows:
         Marconova Marconova 
        Marconova fair value fair value to 
        Book value adjustment the Group 
        £’000 £’000 £’000
Property, plant and equipment         19 – 19
Intangible assets        – 150 150
Purchased goodwill        804 (804) –
Inventories        10 – 10
Trade and other receivables        84 – 84
Trade and other payables        (987) – (987)
Deferred tax        – (45) (45)
Net identifiable assets and liabilities       (70) (699) (769)
Goodwill on acquisition          2,194
Total purchase cost          1,425
Consideration paid in shares (557,725 shares at 179.3p)        (1,000)
Payments in cash          425
Being: Consideration paid in cash          376
   Cash paid for acquisition expenses         49
           425
Cash acquired          –
Net cash outflow in respect of purchase         425
The fair value adjustments above relate to recognition of intangible assets acquired as part of the business combination (£150,000), the 
write-down of own-company goodwill (£804,000) and recognition of the deferred tax liability relating to intangible assets acquired (£45,000).
See Note 11 for details of intangible assets identified on acquisition. The remaining goodwill is chiefly attributable to the value of the customer-
base and non-contractual customer relationships which do not fulfil the intangible assets recognition criteria under IFRSs and the significant 
synergies expected to arise after acquisition. Concateno plc 
Annual Report and Accounts 2008 46
10 Acquisitions continued
(v) Acquisition of CPL International Services Limited
On 13 July 2007, the Group acquired all the shares in CPL International Services Limited (‘CPL ’), based in Liverpool, at fair value for £795,000 in 
cash and £84,000 in shares. The Company provides drug testing services in the medico-legal and international maritime sectors.
From the date of acquisition, CPL contributed £28,000 of profit after tax to the Group in 2007.
The finalised fair value of net assets acquired was as follows:
         CPL CPL 
        CPL fair value fair value to 
        Book value adjustment the Group 
        £’000 £’000 £’000
Property, plant and equipment         282 – 282
Intangible assets        – 158 158
Inventories        2 – 2
Trade and other receivables        107 16 123
Cash and cash equivalents        14 – 14
Trade and other payables        (37) – (37)
Deferred tax        – (44) (44)
Net identifiable assets and liabilities       368 130 498
Goodwill on acquisition          381
Total purchase cost          879
Consideration paid in shares (50,150 shares at 167.5p)        (84)
Payments in cash          795
Being: Consideration paid in cash          659
   Cash paid for acquisition expenses         136
           795
Cash acquired          (14)
Net cash outflow in respect of purchase         781
The fair value adjustments above relate to recognition of intangible assets acquired as part of the business combination (£158,000), and 
recognition of the deferred tax liability relating to intangible assets acquired (£44,000).
See Note 11 for details of intangible assets identified on acquisition. The goodwill is chiefly attributable to the profitability of the business and the 
significant synergies expected to arise after acquisition.
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 47
Concateno plc 
Annual Report and Accounts 2008
10 Acquisitions continued
(vi) Acquisition of Cozart plc
On 4 October 2007, the Group acquired all the shares (issued and to be issued) in Cozart plc (‘Cozart’), based in Abingdon, at fair value for 
£67,413,000 in cash (including acquisition costs) and £1,778,000 in shares. The Company is a specialist in the field of drugs-of-abuse testing 
with a portfolio of Laboratory services, Point-of-Care products and Laboratory products to offer its customers (who include those in the 
workplace, medical and criminal justice markets worldwide).
From the date of acquisition, Cozart contributed £376,000 of profit after tax to the Group in 2007.
The finalised fair value of net assets acquired was as follows:
         Cozart Cozart 
        Cozart fair value fair value to 
        Book value adjustment the Group 
        £’000 £’000 £’000
Property, plant and equipment         1,912 – 1,912
Capitalised development costs        1,212 – 1,212
Intangible assets acquired        – 22,468 22,468
Inventories        2,895 – 2,895
Trade and other receivables        7 ,089 (65) 7 ,024
Cash and cash equivalents        2,826 – 2,826
Deferred tax asset        581 – 581
Trade and other payables        (6,942) (151) (7 ,093)
Loans and borrowings        (3,825) – (3,825)
Deferred tax liability        – (6,290) (6,290)
Net identifiable assets and liabilities       5,748 15,962 21,710
Goodwill on acquisition          47,481
Total purchase cost          69,191
Consideration paid in shares (1,369,013 shares at 130p)        (1,778)
Payments in cash          67,413
Being: Consideration paid in cash          64,863
   Cash paid for acquisition expenses         2,550
           67,413
Cash acquired          (2,826)
Net cash outflow in respect of purchase         64,587
Acquisition expenses include £350,000 completion bonus paid to Directors.
 
The fair value adjustments above relate to recognition of intangible assets acquired as part of the business combination (£22,468,000), a 
holiday-pay accrual at the date of acquisition (£21,000), increased bad debt provision at the date of acquisition (£65,000), an adjustment to the 
valuation of a deferred consideration provision at the date of acquisition (£130,000) and recognition of the deferred tax liability relating to 
intangible assets acquired (£6,290,000).
See Note 11 for details of intangible assets identified on acquisition. The remaining value of goodwill relates to other intangible assets not 
identified under IFRS 3 chiefly being the following;
The value of the customer-base and non-contractual customer relationships which do not fulfil the intangible assets recognition criteria •	
under IFRS 3.
Strategic premium, geographical positioning, market share and market leadership associated with the business. •	
The contribution of the assembled workforce. •	
Benefits derived from economies of scale. •	 Concateno plc 
Annual Report and Accounts 2008 48
11 Goodwill and other intangible fixed assets
     Development  Customer Customer Commercial Patents and 
    Goodwill costs relationships contracts agreements trade marks Total 
    £’000 £’000 £’000 £’000 £’000 £’000 £’000
Cost
At 1 January 2007    23,440 – 5,793 – – 4,035 33,268
Acquisitions through  
business combinations    74,498 1,212 12,219 714 6,469 17 ,860 112,972
Other additions     247     247
At 31 December 2007 and 1 January 2008   97,938 1,459 18,012 714 6,469 21,895 146,487
Adjustments to fair value of prior year acquisitions   397 – – – – – 397
Additions     – 1,125 – – – 9 1,134
At 31 December 2008    98,335 2,584 18,012 714 6,469 21,904 148,018
Amortisation
At 1 January 2007    – – 56 – – 77 133 
Amortisation for the year    – 40 962 21 139 1,071 2,233
At 31 December 2007 and 1 January 2008   – 40 1,018 21 139 1,148 2,366
Amortisation for the year    – 161 1,361 84  555  1,659 3,820
Impairment    – – 71 – – – 71
At 31 December 2008    – 201 2,450 105 694 2,807 6,257
Carrying amounts
At 1 January 2007    23,440 – 5,737 – – 3,958 33,135
At 31 December 2007 and 1 January 2008   97 ,938 1,419 16,994 693 6,330 20,747 144,121
At 31 December 2008    98,335 2,383 15,562 609 5,775 19,097 141,761
Impairment testing for cash-generating units containing goodwill
Goodwill arising on a business combination is allocated at acquisition to the cash generating units (‘CGUs’) that are acquired and is 
denominated in the functional currency of the CGU.
The Group reviews and tests goodwill for impairment on an annual basis, on 31 December each year, or more frequently in the event that there 
are any indications that it may have been impaired.
The Group compares the carrying amount and the recoverable amount in its testing for impairment. The recoverable amount of the CGU is 
determined from value-in-use calculations. These calculations include assumptions in respect of forecast selling prices, forecast raw material 
and other direct costs, forecast exchange rates affecting the currencies in which transactions of the CGU are made, revenue growth rates and 
the discount rate. Each of these assumptions is included in the detailed plans prepared by management which support the impairment review. 
The calculations are based on the actual operating results and the most recent budget and forecast business plan for the three years ending 31 
December 2011. A further 14 years of projected cash flows are incorporated using an estimated annual growth rate and a terminal value is used 
thereafter, where appropriate, which reflects management’s assessment of the long-term average growth rate for the Group’s products and 
services and the geographies it currently operates in and plans to operate in. This internal work was benchmarked against external market 
analysis recently carried out which gave additional third-party verification for management’s growth assumptions.
Management estimate discount rates by reference to current market assessments of the time value of money adjusted by the specific risks of 
the CGU being measured. The discount rates used were also amended according to the conditions relating to each specific business unit 
operating within that CGU, where relevant. This particularly impacts the Point-of-Care CGU which includes forecast cashflows associated with a 
range of technologies, some of which are less proven in the market than others, and hence have a higher risk-factor associated with them (as 
well as a higher growth rate in the early years post-launch). 
Growth rates from year four and discount rates applied, by CGU, are summarised in the table below. Within each CGU, the Group offers a 
range of products and services. The growth rates disclosed include the highest and lowest growth rates forecast within each unit. Volume and 
pricing assumptions made are a reflection of the latest market-data available and include an increased geographical spread, particularly with 
regard to new products being launched in the Point-of-Care testing CGU. As mentioned above, this also has been considered in the discount-
rate applied to these particular cashflows. Changes to selling prices, raw materials, and other direct costs are based on past experience and 
management expectations of future market changes. 
        Laboratory  Point-of-Care Laboratory 
        Services Testing Products
Growth rate:  From year 4: 2008        8 to 0% 10 to 4% 6 to 3%
       From year 4: 2007        8 to 2% 11 to 4% 6 to 0%
Discount rate (pre-tax): 2008        15.4% 15.4%/25.7% 16.8%
           2007        15.6% 15.0%–16.3% 16.0%
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 49
Concateno plc 
Annual Report and Accounts 2008
11 Goodwill and other intangible fixed assets continued
Whilst management is confident that its assumptions are appropriate in light of circumstances at the time of review, it is possible that 
circumstances may change. With the exception of the Laboratory Products CGU, the recoverable amounts calculated on the above basis 
significantly exceed the carrying values of the cash generating units that includes goodwill and working capital to the extent that the 
assumptions made would need to change by a significant amount to eliminate the surplus. For the Laboratory Products CGU, an increase of 
2% in the post-tax discount rate would lead to an impairment of £1,027,000. However, management are satisfied that both the growth rates and 
discount rates assumed in this sector are not aggressive and therefore sufficient headroom exists.
The Goodwill by CGUs comprises:
         2008 2007 
         £’000 £’000
Laboratory services         48,798 48,699
Point-of-Care testing         36,631 36,425
Laboratory products         12,906 12,814
          98,335 97,938
Recoverability of development costs
There are two development projects which make up the ‘development costs’ intangible asset; the Cozart
®
 DDS system and the Cozart-Philips 
system development project. 
The Cozart
®
 DDS system was launched in July 2006 and has been amortised since the commencement of commercial production at that time. 
There have been no indications that the current carrying value of this asset is impaired.
The Cozart-Philips development project is on-going and commercial production has not yet begun. Accordingly, no amortisation has yet been 
charged. The carrying amount of this intangible asset is supported by the future cash flows which are forecast to be generated from sale of this 
product when it is launched. Forecast cashflows from the point of launch of the product are such that the current carrying value of this asset is 
fully supportable.
The Cozart-Philips project does not meet the definition of a Joint Venture, according to the terms set out in IAS 31, and has therefore not been 
accounted for as such. 
Intangible assets acquired as a result of acquisitions
Intangible assets acquired as a result of the acquisitions detailed in Note 10 are summarised below:
 
      Customer  Customer Commercial Patents and 
      relationships contracts agreements trademarks Total 
      £’000 £’000 £’000 £’000 £’000
Laboratory services      10,763 – – 10,320 21,083
Point-of-Care testing      5,243 714 6,469 9,448 21,874
Laboratory products      2,006 – – 2,127 4,133
       18,012 714 6,469 21,895 47,090
Impairment loss          (71)
Cumulative Amortisation (including impact of any impairment)        (5,985)
Net book value at 31 December 2008         41,034
Intangible assets acquired are allocated at acquisition to the CGUs that are acquired and are denominated in the functional currency of  
the CGU.
The carrying amount of each asset is reviewed at least annually to ensure there are no indications of impairment. An impairment loss would be 
recognised whenever the carrying amount of the asset or its CGU exceeds its recoverable amount. One asset was found to be impaired due to 
the loss of a contract in the year to 31 December 2008, accordingly, £71,000 impairment losses (cost of £87,000, amortisation impact £16,000) 
have been recognised.  Concateno plc 
Annual Report and Accounts 2008 50
12 Property, plant and equipment
        Land and Plant and 
        buildings machinery Total 
        £’000 £’000 £’000
Cost
At 1 January 2007         15 376 391
Acquisitions through business combinations       602 2,645 3,247
Other additions        71 498 569
Disposals        (2) (202) (204)
At 31 December 2007 and 1 January 2008       686 3,317 4,003
Acquisitions through business combinations       – – –
Other additions        224 1,430 1,654
Disposals        – (45) (45)
At 31 December 2008        910 4,702 5,612
Depreciation
At 1 January 2007        1  23 24
Depreciation for the year        146 611 757
Disposals        – (188) (188)
At 31 December 2007 and 1 January 2008       147 446 593
Depreciation for the year        52 1,231 1,283
Impairment loss        90 – 90
Disposals        – (45) (45)
At 31 December 2008        289 1,632 1,921
Carrying amounts
At 1 January 2007        14 353 367
At 31 December 2007 and 1 January 2008        539 2,871 3,410
At 31 December 2008        621 3,070 3,691
Impairment
An impairment loss of £90,000 was recognised during the year following building-revaluation carried out. See Note 3.
Leased plant and machinery
Included in the above table are assets held under finance leases as follows:
         2008 2007 
         £’000 £’000
Plant and machinery
Carrying value         270 490
Depreciation         95 95
Motor vehicles
Carrying value         2 10
Depreciation         1 2
Security
At 31 December 2008 UK and Spanish-based fixed assets of the Group with a carrying amount of £25,001,000 (2007: £28,750,000) are subject 
to a registered debenture to secure the term loan (see Note 18). 
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 51
Concateno plc 
Annual Report and Accounts 2008
13 Deferred tax assets and liabilities
Recognised deferred tax assets and liabilities
Deferred tax assets and liabilities are attributable to the following:
      Assets  Liabilities  Net
     2008 2007 2008 2007 2008 2007 
     £’000 £’000 £’000 £’000 £’000 £’000
Property, plant and equipment     (339) (193) 145 96 (194) (97)
Intangible assets     – – 11,437 12,533 11,437 12,533
Share-based payments     (33) (104) – – (33) (104)
Other temporary differences     20 (96) – – 20 (96)
Derivative contracts     (429) –   (429) –
Tax loss carry forwards     (300) (465) – – (300) (465)
Tax (assets)/liabilities     (1,081) (858) 11,582 12,629 10,501 11,771
Movements in temporary differences have been as follows:
     Balance  Impact  Acquired in Balance 
     1 January Recognised of 2008  Recognised business  31 December 
     2007 in income rate change in equity combinations 2007 
     £’000 £’000 £’000 £’000 £’000 £’000
Property, plant and equipment     – (114) – – 17 (97)
Intangible assets     2,715 (614) (293) – 10,725 12,533
Share-based payments     (10) (82) 1 (13) – (104)
Other temporary differences     – (18) – – (78) (96)
Tax loss carry forwards     – 577 53 – (1,095) (465)
      2,705 (251) (239) (13) 9,569 11,771
      Balance    Balance 
      1 January Recognised Recognised Prior year 31 December 
      2008 in income in equity adjustments 2008 
      £’000 £’000 £’000 £’000 £’000
Property, plant and equipment – asset     (192) 9 – (155) (338)
Property, plant and equipment – liability     95 49   144
Intangible assets      12,533 (1,013) – (83) 11,437
Share-based payments      (104) 71 –  (33)
Other temporary difference      (96) (40) – 156 20
Derivative contracts      – (429) – – (429)
Tax loss carry forwards      (465) 300 – (135) (300)
       11,771 (1,053) – (217) 10,501
At the balance sheet date, the Group has unutilised gross tax losses of approximately £4,720,953 (2007: £4,988,736) potentially available for 
offset against future taxable profits. A deferred tax asset of £300,412 (2007: £465,104) has been recognised in respect of £1,072,899 (2007: 
£1,661,086) of gross trading losses. No deferred tax asset has been recognised in respect of the remaining £3,648,054 (2007: £3,327,650) of 
gross losses, as these are not expected to be recovered in the foreseeable future. Concateno plc 
Annual Report and Accounts 2008 52
14 Inventories
         2008 2007 
         £’000 £’000
Raw materials and consumables         2,839 2,217
Finished goods and goods for resale        2,159 1,728
Less: provisions against obsolete and excess stock       (63) (90)
          4,935 3,855
15 Trade and other receivables
         2008 2007 
         £’000 £’000
Trade receivables          12,876 9,577
Other debtors, prepayments and accrued income       1,836 2,242
           14,712 11,819
For detail regarding the deferred tax asset, see Note 13.
At 31 December 2008 trade receivables are shown net of allowances for doubtful debts of £1,165,000 (2007: £800,000). The majority of this 
provision has been made in relation to trading with non-UK Laboratory-services customers (this division having been acquired towards the end 
of 2007) based on experience of customer’s payment track-record. The Group monitors debtor payment profiles closely and credit policies are 
in place which aim to reduce the Group’s exposure. 
Receivables denominated in currencies other than the functional currency comprise £2,734,000 of trade receivables denominated in US Dollars 
(2007: £1,748,000) and £404,000 of trade receivables denominated in Euros (2007: £679,000), £44,000 (2007: £nil) denominated in Swedish 
Krona and £25,000 (2007: £nil) denominated in Australian Dollars.
16 Derivative financial instruments
       Current  Non-current
       2008 2007 2008 2007 
       £’000 £’000 £’000 £’000
Derivatives that are designated and effective as hedging instruments carried at fair value  
 Interest rate swaps       – (184) – –
Derivatives that are held at fair value through profit or loss (or designated as such)
 Forward foreign currency contracts       – 3 – –
 Interest rate swaps       (1,612)
        (1,612) (181) – –
The hedging reserve comprises the effective portion of the cumulative net change in the fair value of cash flow hedging instruments related to 
hedge transactions that have not yet occurred. £184,000 has been credited to the hedging reserve following re-designation of a previously 
effective hedge out of equity in the period. This charge (£184,000) together with the change in fair value in respect of this particular interest 
swap during the year (£1,349,000) has been recognised in the income statement for the year ended 31 December 2008 as an exceptional item. 
A charge of £82,000 has also been recognised in the income statement for the year ended 31 December 2008 in respect of another derivative 
not designated as being held at fair value through profit or loss (recognised as a finance cost).
Further details of derivative financial instruments are provided in Note 19.
17 Cash and cash equivalents
         2008 2007 
         £’000 £’000
Cash and cash equivalents         4,292 3,888
Bank overdrafts         (2,965) (1,685)
Cash and cash equivalents in the statement of cash flows       1,327 2,203
Cash and cash equivalents comprise bank deposits and cash in hand.
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 53
Concateno plc 
Annual Report and Accounts 2008
18 Loans and borrowings
This note provides information about the contractual terms of the Group’s interest-bearing loans and borrowings. For more information about 
the Group’s exposure to interest rate, liquidity, and foreign currency risk, see Note 19. 
         2008 2007 
         £’000 £’000
Current liabilities
Current portion of secured bank loans        24,737 3,521
Current portion of other unsecured loans        273 197
Current portion of finance lease liabilities        100 213
          25,110 3,931
Non-current liabilities 
Secured bank loans         – 24,737
Convertible loans         – 8,343
Other loans         221 352
Finance lease liabilities         105 219
          326 33,651
          25,436 37,582
 
Debt costs arising on arranging the debt facilities are being amortised over the life of the loans to which they relate. As at 31 December 2008, 
the unamortised element amounted to £263,000 (2007: £492,000). The balances disclosed above are net of these unamortised debt costs.
In addition to the 2007 amounts disclosed above, the derivative element of a convertible financial loan instrument was valued at £417,102 at the 
date of issue. This derivative element did not fully meet the definition of a component of equity and was therefore held as a current liability on 
the Balance Sheet at the time the loan was in place. This loan was converted during 2008. The carrying value of the loan to which it related is 
therefore £nil as at 31 December 2008 (2007: £8,343,000).
Terms and debt repayment schedule
Terms and conditions of outstanding loans were as follows:
       31 December 2008  31 December 2007
     Nominal  Face  Carrying Face Carrying 
     Interest rate Year of Value amount value amount 
    Currency % maturity £’000 £’000 £’000 £’000
Secured bank loan    GBP 6.21
1
 2008 – – 3,750 3,521
       2009 25,001 24,737 25,000 24,737
Convertible loan    GBP 12.5 2009 – – 8,720 8,343
Unsecured other loan    Euro 0 2008 – – 109 109
       2009  273 273 380 380
       2010–2012  221 221 60 60
Finance lease liabilities    GBP 5.8–8 2009–2012 226 205 432 432
        25,721 25,436 38,45 1 37,582
1  The effective interest rate changes with the underlying LIBOR rate (being set as three month LIBOR + 3% margin), but is correct as at 31 December 2008. See Note 19 for  
further details.
The bank loans are secured over the assets of the holding company and all subsidiaries and security be created over shares or quotes in the 
capital of all companies that fall within the Concateno Group with a carrying amount of £25.0m (2007: £28.8m).
The Group is subject to quarterly covenant reviews by the bank in connection with its secured bank loan. The covenants reviewed are in 
respect of gross leverage, interest cover, cashflow cover and capital expenditure. There were no breaches during 2008 and no breaches 
forecast in 2009.
The secured bank loan is disclosed as falling due within one year even though refinancing negotiations are currently under way.  
 
The secured bank loan is repayable in tranches. Repayment dates, as they currently stand, and amounts to be repaid (at face value) are 
summarised below:
      Tranche A Tranche B Tranche C Tranche D Total  
Repayment Date      £’000 £’000 £’000 £’000 £’000
31 Mar 09      500 167 167 625 1,459
30 Jun 09      500 167 167 625 1,459
30 Sep 09      500 167 167 625 1,459
31 Dec 09      5,250 1,750 1,750 11,874 20,624 
       6,750 2,251 2,251 13,749 25,001
See Financial Review on pages 13 to 15 for further detail on term loan refinancing. Concateno plc 
Annual Report and Accounts 2008 54
18 Loans and borrowings continued
Finance lease liabilities
Finance lease liabilities are payable as follows:
     Minimum    Minimum 
     lease   lease  
     payments Interest Principal payments Interest Principal 
     2008 2008 2008 2007 2007 2007 
     £’000 £’000 £’000 £’000 £’000 £’000
Less than one year     112 12 100 213 24 189
Between one and five years     114 9 105 219 21 198
More than five years     – – – – – –
      226 21 205 432 45 387
19 Financial instruments
The Group’s principal financial instruments comprise bank loans, convertible loan instruments, cash and short-term deposits, the main purpose 
of which is to provide finance for the Group’s operations. The Group has other financial assets and liabilities such as trade receivables and trade 
payables, which arise directly from its operations. The Group also enters into derivative transactions, including principally interest rates collars 
and forward currency contracts.
The Group’s policies relating to financial risk management are set out in the Directors’ Report on page 20.
Credit risk
Management has a credit policy in place and the exposure to credit risk is monitored on an ongoing basis. The Group operates a credit review 
process for all potential customers on a case-by-case basis and reviews the aging of debts on a regular basis with reports reviewed by the 
Board on a monthly basis. 
The Group limits its exposure to credit risk by only investing in liquid securities and only with counterparties with AAA credit rating. The Group 
does not require collateral in respect of financial assets.
At the balance sheet date there were no significant concentrations of credit risk. The maximum exposure to credit risk is represented by the 
carrying amount of each financial asset, including derivatives in the balance sheet.
Interest rate risk
The Group’s interest rate risk relates primarily to the Group’s long-term debt obligations with a floating interest rate. The Group’s policy is to 
reduce the interest rate risk by entering into interest rate hedges on at least 70% of its variable rate interest borrowings.
During 2007 the Group entered into an interest rate hedge that caps the variable rate of interest payable on 75% of the Group’s Term loans to 
LIBOR at 6.5%, with a floor set at 3.73%. If LIBOR falls below 3.73% in any calendar quarter a strike rate of 5.75% is payable on the hedged 
borrowings in that quarter. The interest rate hedge expires on 31 December 2014 and reduces during that period to match 75% of the 
scheduled underlying bank debt outstanding at each calendar quarter end. Payments of the interest rate hedges have been set up in order to 
match the dates on which the interest payments on the underlying borrowings are due for payment.
Note 18 summarises the nature of the Group’s exposure to underlying fixed rate and variable borrowings. The table below shows the value of 
interest rate hedges on the underlying variable rate borrowings at the end of each financial year.
          Value of hedge 
          £’000
31 December 2008          18,750
31 December 2009          14,905
31 December 2010          12,655
31 December 2011          10,406
31 December 2012          8,155
31 December 2013          5,905
31 December 2014          –
In May 2008 the Group entered into an interest rate swap instrument over £20m of the Barclays Term loan facility to run from 30 June 2008 to 
30 June 2009. The effect of this instrument was to enter into a basis swap to pay interest on the £20m on one-month LIBOR rather than 
three-month LIBOR. The benefit of this was to reduce the interest charge over the period by approximately 9 basis points.
Based on the gross interest bearing debt and interest rate derivatives existing at 31 December 2008, a parallel upward shift in yield curves of 
1% would reduce the Group’s annualised loss before tax by £282,000.
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 55
Concateno plc 
Annual Report and Accounts 2008
19 Financial instruments continued
Liquidity risk
The Group aims to mitigate liquidity risk by managing the cash generation of its operations. The Group’s liquidity risk arises from timing 
differences between cash inflows and outflows. The Group manages these risks through a centralised treasury function and through committed 
credit facilities.
At 31 December the Group had in place a committed credit facility in place of £2m for working capital purposes. This facility was not utilised at 
31 December 2008.
Foreign currency risk
The Group is exposed to foreign currency risk on sales, purchases and borrowings that are denominated in a currency other than the 
respective functional currencies of Group entities. The currencies giving rise to this risk are primarily Euros and US Dollars.
The Group reviews its exposure to foreign currency risk in respect of forecast sales and purchases over the medium term. The Group is in the 
main internally hedged in respect of inflows and outflows of US Dollars and Euros.
The Group had no foreign exchange hedge instruments in place at 31 December 2008.
Forecast transactions
The Group classifies its forward exchange contracts and hedging forecast transactions as cash flow hedges. The net fair value of forward 
exchange contract at 31 December 2008 was £(1,612,000) (2007: £(181,000)), comprising assets of £nil (2007: £3,000) and liabilities of 
£1,612,000 (2007: £184,000). 
20 Trade and other payables
         2008 2007 
         £’000 £’000
Trade payables         4,734 3,994
Non trade payables         1,778 1,404
Accruals and deferred income          3,217 3,494
          9,729 8,892
Payables denominated in currencies other than the functional currency comprise £1,076,000 of trade payables denominated in US Dollars 
(2007: £576,000), £83,000 trade payables in Euros (2007: £42,000), £84,000 in Japanese Yen (2007: £10,000) and £nil in Swedish Krona (2007: 
£5,000).
21 Provisions for liabilities and charges
         Deferred & 
     Rental Onerous Legal Redundancy contingent 
     provision Lease & Advisory provision consideration Total 
     £’000 £’000 £’000 £’000 £’000 £’000
Balance at 1 January 2007     – – – – – –
Acquired in a business combination    705 – 165 – 1,425 2,295
Provisions used during the period     (25) – – – – (25)
At 31 December 2007 and 1 January 2008    680 – 165 – 1,425 2,270
Provisions made during the period     – 445 563 129 – 1,137
Provisions used during the period     (101) (63) – – (1,349) (1,513)
At 31 December 2008     579 382 728 129 76 1,894
Current     101 86 728 129 76 1,120
Non-current     478 296 – – – 774
At 31 December 2008     579 382 728 129 76 1,894
Rental provision
On the acquisition of Cozart plc, a provision for £705,000 was made in respect of the spreading of rental costs on one of the Group’s buildings. 
This provision will be released over the remaining life of the building’s operating lease (until 2014).
Onerous lease provision
As part of the integration exercise undertaken during the year, the Group vacated a number of properties. A provision of £382,000 (2007: £nil) 
has therefore been made for the remaining duration of the lease agreement in relation to the portion of this property which remains unused and 
un-let (£41,000 until 2011 with the remainder until 2014).
Legal and Advisory
A provision of £728,000 (2007: £165,000) has been made for the best estimate of costs and advisory costs expected to be incurred in relation 
to various enquiries which had not been concluded at the year-end.
Redundancy provision
Five redundancies were announced prior to the end of 2008 as a result of site closure and team restructuring in the UK. A provision of £129,000 
(2007: £nil) has been booked in relation to the cost of these redundancies. Concateno plc 
Annual Report and Accounts 2008 56
21 Provisions for liabilities and charges continued
Deferred consideration
In 2007, £1,025,000 was provided for in relation to deferred consideration which is payable to the vendors of Spinreact SA in September 2008. 
This was settled in the period. Spinreact is a subsidiary of Cozart plc who Concateno acquired during 2007. 
Contingent consideration
£76,000 (2007: £400,000) is expected to become payable to the vendors of Nemesis Scientific Limited in March 2008. There are performance 
conditions attached to the award of this deferred consideration. Management believe that these performance conditions will be met and, 
therefore, that the whole of the deferred consideration will fall due. 
22 Capital and reserves
     Share    
    Share premium Hedging Merger Translation Retained 
    capital account reserve reserve reserve earnings  Total 
     £’000 £’000 £’000 £’000 £’000 £’000 £’000
Balance at 1 January 2007    2,794 20,008 – 706 – (1,252) 22,256
Issue of ordinary shares     6,722 73,233 – 7 ,138 – (4,381) 82,712
Cost of share issue     – (3,488) – – – – (3,488)
Exercise of share options     14 122 – – – – 136
Share-based payment in respect of employee options   – – – – – 439 439
Share-based payment in respect of third-party warrant   – – – – – 354 354
Total recognised income and expense    – – (184) – 298 665 779
At 31 December 2007 and 1 January 2008   9,530 89,875 (184) 7,844 298 (4,175) 103,188
Issue of ordinary shares     15 185 – – – – 200
Conversion of loan    1,059 9,011 – – – – 10,070
Exercise of share options    10 75 – – – – 85
Share-based payments in respect of employee options  – – – – – 555 555
Total recognised income and expense    – – 184 – 2,162 (424) 1,922
At 31 December 2008    10,614 99,146 – 7,844 2,460 (4,044) 116,020
Hedging reserve
The hedging reserve comprises the effective portion of the cumulative net change in the fair value of cash flow hedging instruments related to 
hedge transactions that have not yet occurred.
Merger reserve
The merger reserve contains the premium on shares issued as consideration for business combinations during the period.
Translation reserve
The translations reserve comprises all foreign currency differences arising from the translation of the financial statement of foreign operations.
         2008 2007 
         £’000 £’000
Authorised share capital
150,050,000 ordinary shares of £0.10 each (2007: 150,050,000 shares)      15,005 15,005
Allotted, called up and fully paid
106,139,707 ordinary shares of £0.10 each (2007: 95,299,415 shares)      10,614 9,530
During the year the following ordinary shares of £0.10 were issued by the Company in respect of share options:
 
        Total nominal Total share Total 
       Number of value  premium consideration 
       shares £’000 £’000 £’000
Exercise of share options       102,277 10 75 85
23 Employee benefits
Defined contribution plans
The Group operates defined contribution retirement benefit plans for all qualifying employees. The assets of the scheme are held separately 
from those of the Group. Contributions of £48,000 (2007: £15,000) were outstanding at the end of the year. The charge to the income statement 
representing the contribution payable by the Group was £381,000 (2007: £177,000).
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 57
Concateno plc 
Annual Report and Accounts 2008
24 Share options and warrants
Share options 
The Group operates an Enterprise Management Incentive (‘EMI’) share option scheme and an Employee Benefit Trust Incentive Scheme (‘EBT’) 
as a means of encouraging ownership and aligning interests of staff and external shareholders. Share options are granted at the discretion of 
the Remuneration Committee taking into account the need to motivate, retain and recruit high calibre employees. Share options are granted at 
the closing mid-market value of the Company’s ordinary shares on the day prior to grant, or where the Remuneration Committee consider that 
the share options are issued further to an acquisition event they are granted at the share price pertaining to that acquisition event.
Options have been granted over £0.10 ordinary shares as follows:
         EMI EBT 
         Number Number
At 31 December 2007         1,137 ,250  2,537 ,759
Granted during the year         622,116 2,352,884
Exercised during the year `        (68,027) –
Lapsed during the year         (204,081) (659,864)
At 31 December 2008         1,487,258 4,230,779
As at 31 December 2008, the outstanding share options, which include the share options granted to Directors as stated in the Directors’ 
Remuneration Report, are shown below.
  At    At     
  1 January Options Options Options 31 Dec     
  2008 granted exercised lapsed 2008  Date  Exercise Exercise Expiry 
Class  Number Number Number Number Number granted price (p) date date
Enterprise Management Incentive share option (10p ordinary shares):      
A   262,498 – – – 262,498 07/11/2006 85 07/11/2009 07/11/2016
B   262,498 – – – 262,498 07/11/2006 85 07/11/2009 07/11/2016
C   306,127 – 34,014 102,042 170,071 05/04/2007  100–145 05/04/2010 05/04/2017
C    – 299,805 – – 299,805 21/01/2008 130 21/01/201 1 21/01/2018
C    – 11,250 – – 11,250 12/06/2008 130 12/06/201 1 12/06/2018
D   306,127 – 34,013 102,039 170,075 05/04/2007  100–145 05/04/2010 05/04/2017
D    – 299,811 – – 299,811 21/01/2008 130 21/01/201 1 21/01/2018
D    – 11,250 – – 11,250 12/06/2008 130 12/06/2011 11/06/2018
Total  1,137 ,250 622,116 68,027 204,081 1,487,258
Options issued to SG Hambros Trust Company (Channel Islands) Limited, as trustee of a trust of which employees and certain of their
relatives are potential beneficiaries, holds the following options under the Employee Benefit Trust Incentive Scheme:
A   900,000 – – – 900,000 06/11/2006 86 06/11/2009 06/11/2016
B   900,002 – – – 900,002 06/11/2006 86 06/11/2009 06/11/2013
C   368,879 – – 279,931 88,948 05/04/2007 147 05/04/2010 05/04/2014
D   368,878 – -  279,933 88,945 05/04/2007 147 05/04/2010 05/04/2014
E    – 1,176,442 – 50,000 1,126,442 12/06/2008 142 12/06/201 1 12/06/2015
F    – 1,176,442 – 50,000 1,126,442 12/06/2008 142 12/06/201 1 12/06/2015
   2,537 ,759 2,352,884 – 659,864 4,230,779  
The weighted average share price at the date of exercise for options exercised during the year was 146p (2007: 120p).
There are certain performance criteria to be met before share options are exercisable:
EMI Option classes A, C and E are exercisable after holders satisfy a period of three years continuous service from the date of the grant of  
the option.
EMI Option class B and EBT Class B options are exercisable after holders or employees beneficiaries satisfy a period of three years continuous 
service, subject to the 30 day average mid market share price of an ordinary share being equal to, or greater than, 133% of the placing price of 
shares at 6 November (acquisition of Medscreen) and before the tenth anniversary of that date. The placing price of shares on 6 November 
2006 was 85p.
EMI Class D, EBT Class D and EBT Class F options are exercisable after holders satisfy a period of three years continuous service, subject to 
the 30 day average mid market share price of an ordinary share being equal to, or greater than, 200p at any time during the exercise period.
The shares issued to the Employee Benefit Trust will be held on the following terms:
In the event that there is a Change of Control, as defined in the Share Plan and generally subject to the Rules of the Plan as to Vesting and 
when Shares Vest, prior to the seventh anniversary of the date of Acquisition of the Shares, the Shares shall Vest as follows:
(i)  If the Exit Price is £2.75 or more the Shares shall Vest in full;
(ii) If the Exit Price is £2.50 or more but less than £2.75 the Shares shall Vest as to three-quarters; 
(iii) If the Exit Price is £2.25 or more but less than £2.50 the Shares shall Vest as to half;
(iv) If the Exit Price is below £2.25 then no Shares shall Vest.
The above conditions are based on the performance of a Share price at a Change of Control and shall constitute the Performance Condition. Concateno plc 
Annual Report and Accounts 2008 58
24 Share options and warrants continued
The Exit Price is the value per share to be obtained by a holder as a result of the Change of Control and as calculated by the Directors of the 
Company and communicated to the Trustee. The Trustee shall be entitled to rely on the Director’s Exit Price. In the event there is a 
reorganisation etc. involving the Company which, in the opinion of the Directors, renders the hurdle Exit Prices of £2.25, £2.50 and £2.75 
inappropriate for the purposes of Vesting, then the Directors shall fairly adjust the hurdle Exit Prices so that the Performance Condition, in terms 
of achievability, remains constant. 
EMI and EBT Option assumptions
The options pricing model used was the binomial model. The inputs to this model were:
Vesting period (years)          3.0
Expected volatility          30%
Option life (years)          7
Expected life (years)          3
Risk free rate          5.25%/4.60%
Expected dividends expressed as dividend yield         0%
Options issued to employees under EMI Scheme
 
  Share price Exercise  Shares  Vesting Expected  
 Grant at grant price at Number of  under option Fair period share price Expected Risk-free  
Class  date date (p)  grant date (p)  employees  at grant  value (p)  (years)  volatility (%)  life  rate (%)
A  07/11/2006  85.0 85.0 9 262,498 28.2 3.00 30 3 5.25
B  07/11/2006 85.0 85.0 9 262,498 28.2 3.00 30 3 5.25
C – Altrix Tranche 05/04/2007 147.0 100.0 2 68,027 64.2 3.00 30 3 4.60
C – TrichoTech Tranche 05/04/2007 147.0 130.0 3 102,043  42.6 3.00 30 3 4.60
C – Euromed Tranche 05/04/2007 147.0 145.0 4 136,057 42.2 3.00 30 3 4.60
C – Cozart Tranche 21/01/2008 115.5 130.0 10 299,805 26.0 3.00 30 3 4.53
C – Cozart Tranche 12/06/2008 147.5 130.0 3 11,250 49.9 3.00 30 3 5.06
D – Altrix Tranche 05/04/2007 147.0 100.0 2 68,027 64.2 3.00 30 3 4.60
D – TrichoTech Tranche 05/04/2007 147.0 130.0 3 102,043  42.6 3.00 30 3 4.60
D – Euromed Tranche 05/04/2007 147.0 145.0 4 136,057 42.2 3.00 30 3 4.60
D – Cozart Tranche 05/04/2007 115.5 130.0 10 299,811 26.0 3.00 30 3 4.53
D – Cozart Tranche 05/04/2007 147.5 130.0 3 11,250 49.9 3.00 30 3 5.06
Options issued to SG Hambros Trust Company (Channel Islands) Limited, as trustee of a trust of which employees and certain of their 
relatives are potential beneficiaries, holds the following options under EBT Scheme
 
  Share price Exercise  Shares  Vesting Expected  
 Grant at grant price at Number of  under option Fair period share price Expected Risk-free  
Class  date date (p)  grant date (p)  employees  at grant  value (p)  (years)  volatility (%)  life  rate (%)
A  06/11/2006  86.0 86.0 4 900,000 28.7 3.00 30 3 5.25
B  06/11/2006 86.0 86.0 4 900,002 28.2 3.00 30 3 5.25
C  05/04/2007 147.0 147.0 9 368,879 41.4 3.00 30 3 4.60
D  05/04/2007 147.0 147.0 9 368,878 41.4 3.00 30 3 4.60
E  12/06/2008 142.0 142.0 15 1,176,442 44.7 3.00 30 3 5.06
F  12/06/2008 142.0 142.0 15 1,176,442 44.7 3.00 30 3 5.06
The Group recognised total expenses of £555,000 (2007: £439,000) related to equity-settled share-based payment transactions during 
the year.
Warrants
Under a warrant instrument dated 26 October 2006 Marwyn Neptune Fund is entitled to subscribe for 1,397,059 shares in Concateno. The 
exercise price of the warrants is 85p, the placing price at the time of the Medscreen acquisition.
The first 50% of the Marwyn Warrant is exercisable at any time after the date of grant subject to the mid market price of an ordinary share of 
Concateno being equal to or greater than 125% of the Medscreen Placing Price at any date after 6 November 2006. Accordingly these warrants 
became exercisable on 15 December 2006.
The second 50% of the Marwyn Warrant will be exercisable at any time after the date of grant subject to the mid market price of an ordinary 
share of Concateno being equal to or greater than 150% of the Medscreen Placing Price at any date after 6 November 2006. Accordingly these 
warrants became exercisable on 11 January 2007.
The Marwyn Warrant is also exercisable on a takeover offer being made for the whole of the issued share capital of Concateno (or a general 
offer in respect of one class of Concateno`s shares is made) and control of Concateno is thereby obtained. The Marwyn Warrant is freely 
transferable by Marwyn Neptune Fund and is unlisted.
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 59
Concateno plc 
Annual Report and Accounts 2008
24 Share options and warrants continued
In the event of any variation in the share capital of Concateno, auditors can be instructed to determine what adjustment, if any, should be made 
to the number and nominal value of the shares subject to the warrant and/or the exercise price as fairly reflects that change in Concateno’s 
share capital.
Warrant option valuation assumptions
The options pricing model used was the binomial model. The inputs to this model were:
Vesting period (years)          1.0
Expected volatility          30%
Option life (years)          7
Expected life (years)          3
Risk free rate          5.25%
Expected dividends expressed as dividend yield         0%
25 Operating leases
Total lease commitments under non-cancellable operating leases are as follows:
        2008  2007
       Land and  Plant and Land and  Plant and 
       buildings equipment buildings equipment 
       £’000 £’000 £’000 £’000
Less than one year       959 94 1,001 89
Between one and five years       3,725 218 3,722 264
More than five years       713 – 1,625 –
        5,397 312 6,348 353
The Group leases a number of warehouse and factory facilities under operating leases. The leases run for an average of three years with the 
longest lease running until 2014. 
Three operating companies within the Group have operating leases in place for items of plant and equipment. This equipment is used in the 
three main laboratories across the UK and production facilities in Abingdon.
During the year ended 31 December 2008, £1,128,000 (2007: £271,000) was recognised as an expense in the income statement in respect of 
operating leases.
26 Capital commitments and contingencies
Capital commitments had been made in respect of laboratory services equipment for the Cardiff site (£200,000).
There are no contingencies to note. 
27 Related party transactions
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed 
in this note.
Marwyn Partners Ltd, Marwyn Investment Management LLP and Marwyn Capital LLP were deemed to be related parties of Concateno plc 
during 2007 by virtue of a common Director, J Corsellis. Marwyn 10 Buckingham Street LLP is deemed to be a related party by virtue of two 
common partners, K Tozzi and J Corsellis.
        2008  2007
        Amounts  Amounts 
       Provision of due to Provision of due to 
       goods and  related goods and  related 
       services parties services parties 
       £ £ £ £
Marwyn Partners Ltd       – – 5,000 –
Marwyn Capital LLP       189,996 15,498 1,846,000 32,000
Marwyn 10 Buckingham Street LLP       79,992 120,958 98,442 13,000
        269,988 136,456 1,949,442 45,000
The amounts outstanding are unsecured and will be settled in cash. No guarantees have been given or received.
The Group has a corporate advisory agreement with Marwyn Capital LLP. Under the terms of the appointment, Marwyn Capital LLP provided 
general strategic and corporate financial services to the Group for a fixed monthly fee of £15,000 plus expenses. This agreement was 
terminated on 31 May 2008. Subsequent to the termination of this agreement, Concateno entered into an appointment with Marwyn Capital 
LLP to provide strategic and financial advice for the strategic review of the business on 1 June 2008. The Group also has an arrangement  
with Marwyn 10 Buckingham Street LLP for the provision of accommodation and associated back office support services for a fee of Concateno plc 
Annual Report and Accounts 2008 60
27 Related party transactions continued
£6,666 per month. J Corsellis is a Director of the named Marwyn entities and a Non-Executive Director of Concateno. In relation to the possible 
sale of Concateno plc, J Corsellis, V Bolger and C Hall, all employees of Marwyn Investment Management LLP, have a Chinese wall in place 
with other employees of Marwyn Investment Management LLP, whereby they will not disclose details of the transaction to other employees.
Marwyn Neptune Fund LP and Marwyn Ventures 1 LP, shareholders in the Company, are managed on an arms length basis by Marwyn 
Investment Management LLP. Marwyn Neptune Fund and Marwyn Ventures 1 LP (a fund managed by Marwyn Investment Management LLP) 
held a total of 29,174,852 ordinary shares in the Company as at 17 March 2009. Under the terms of an instrument dated 1 November 2006 
Marwyn Neptune Fund was granted a warrant to subscribe for 1,397,058 new ordinary shares in the Company at 85p (the ‘Marwyn Warrant’). 
C Hand is engaged by the Group as a Non-Executive Director under the terms of a letter of appointment. Under the terms of the same letter of 
appointment he is entitled to remuneration of £1,000 per working day for any special project work agreed in relation to the Philips collaboration. 
In 2008, he received remuneration of £41,500 (2007: £11,666) for special project work. In February 2009, C Hand entered into an agreement 
with the Company to provide all special project work through Abingdon Health Ltd, a company of which C Hand is a Director and  
major shareholder.
V Murria has a related party holding of 100,000 ordinary shares as part of a pension fund through her spouse.
V Murria is also a related party through Marwyn Investment Management LLP through the investment by Marwyn Neptune Fund in Advanced 
Computer Software plc of which V Murria is the Chief Executive Officer.
Concateno plc entered into a lease on 10 Buckingham Street, London which is a property owned by Marwyn 10 Buckingham Street LLP, of 
which K Tozzi and J Corsellis are partners.
There were no other transactions or contracts with related parties.
Transactions with the Directors of the Company are disclosed in the Remuneration Report on pages 24 to 25.
28 Group entities
Details of the subsidiary companies of Concateno plc, all of which have been consolidated as at 31 December 2008, are as follows:
 
          Percentage of  
         equity shares held (%)
Subsidiary undertaking Country of incorporation Principal activity 2008  2007
Medscreen Holding Limited
1
 United Kingdom Holding company 100 100
Medscreen Limited United Kingdom Sale of medical diagnostic services 100 100
Altrix Healthcare Limited
1
 United Kingdom Sale of medical diagnostic products and services 100 100
TrichoTech Limited
1
 United Kingdom Sale of medical diagnostic services 100 100
Euromed Limited
1
 United Kingdom Sale of medical diagnostic products 100 100
Marconova AB
1
 Sweden Sale of medical diagnostic services 100 100
CPL International Services Limited
1
 United Kingdom Sale of medical diagnostic services 100 100
Cozart Limited
1
 United Kingdom Holding company 100 100
Cozart Bioscience Limited United Kingdom Manufacture, sale and development of  
     medical diagnostic products and services 100 100
Cozart Italia srl Italy Sale of medical diagnostic products and services 100 100
Cozart Bioscience Inc. United States of America Dormant 100 100
Medib Skandinavien AB Sweden Dormant 100 100
Spinreact SA Spain Manufacture, sale and development of
     medical diagnostic products and services 100 100
Cozart International sarl France Sale of medical diagnostic products and services 100 100
HL Scandinavia AB Sweden Sale of medical diagnostic products and services 100 100
Nemesis Scientific Limited United Kingdom Sale of medical diagnostic products and services 100  100
Concateno Australia Pty Australia Dormant 100 N/A
1 Held directly by Concateno plc.
29 Subsequent events
There are no subsequent events to note.
Notes to the Consolidated Financial Statements  > continued
For the year ended 31 December 2008 61
Concateno plc 
Annual Report and Accounts 2008
Company Balance Sheet >
As at 31 December 2008
         2008 2007 
        Notes £’000 £’000
Fixed assets
Investments        (C3) 136,311 135,033
Intangible assets        (C4) 8 –
Tangible assets        (C5) 94 104
          136,413 135,137
Current assets
Debtors        (C6) 6,191 8,755
Cash at bank and in hand         88 691
          6,279 9,446
Creditors: amounts falling due within one year       (C7) (34,880) (12,505)
Net current liabilities         (28,601) (3,059)
Total assets less current liabilities        107,812 132,078
Creditors: amounts falling due after more than one year      (C7) – (33,458)
Net assets         107,812 98,620
Capital and reserves
Called up share capital        (C8) 10,614 9,530
Share premium account        (C9) 99,146 89,875
Merger Reserve        (C9) 7,844 7,844
Profit and loss account        (C9) (9,792) (8,629)
Equity shareholders’ funds         107,812 98,620
The financial statements were approved by the Board of Directors and authorised for issue on 30 March 2009. They were signed on its 
behalf by:
Fiona Begley   Neil Elton   
Chief Executive Officer  Finance Director
30 March 2009   30 March 2009 
 
The accompanying notes are an integral part of this balance sheet. Concateno plc 
Annual Report and Accounts 2008 62
Notes to the Company Balance Sheet >
C1 Accounting policies
Basis of Preparation
The separate financial statements of the Company are presented as required by the Companies Act 1985. They have been prepared under the 
historical cost convention and in accordance with applicable United Kingdom Accounting Standards and law.
The Company took advantage of the exemption in s230 of the Companies Act 1985 not to present its individual profit and loss account and 
related notes that form part of these approved financial statements.
The principal accounting policies are summarised below and as part of the notes to the Company Balance Sheet. They have all been applied 
consistently throughout the year and the preceding year.
Investments
Fixed Asset Investments in subsidiaries are shown at cost less any provision for impairment.
For investments in subsidiaries acquired for consideration, including the issue of shares qualifying for merger relief, cost is measured by 
reference to the nominal value only of the shares issued.
Debt issue costs
In accordance with FRS 25 the separately identifiable costs on the issue of debt instruments are capitalised and disclosed within creditors as a 
deduction from the related debt. Issue costs are amortised over the life of the debt instruments to which they relate and the associated charge 
to the profit and loss account is included as an interest expense.
Pension costs
The Company operates defined contribution pension schemes. The amount charged against profits represents the contributions payable to the 
scheme in respect of the account period. The assets of the schemes are held separately from those of the Company.
Taxation
The charge for taxation is based on the result for the year and takes into account taxation deferred because of timing differences between the 
treatment of certain items for taxation and accounting purposes. Deferred tax is recognised, without discounting, in respect of all timing 
differences between the treatment of certain items for taxation and accounting purposes which have arisen but not reversed by the balance 
sheet date, except as otherwise required by FRS 19.
Employee share schemes
The fair value of options granted is recognised as an expense together with corresponding increase in equity. The fair value is recognised at 
grant date and spread over the period employees become unconditionally entitled to the option. Fair value is based on market value using a 
binomial option-pricing model. Non market vesting conditions are included in the assumption concerning the number of options that are 
expected to become exercisable. At each balance sheet date, the Company revises its estimate of the number of options that are expected to 
vest for changes in non-market conditions.
Foreign currencies
The functional currency of the Company is Pounds Sterling. Transactions denominated in foreign currencies are translated into Pounds Sterling 
at the rate of exchange on the day the transaction occurs. Monetary assets and liability, which are denominated in a foreign currency, are 
translated at the rate of exchange ruling at the balance sheet date, and the gains and losses on translation are included in the profit and loss 
account.
C2 Staff numbers and costs
The average monthly number of employees (including Directors) for the Group during the year, analysed by category, was:
         2008 2007 
         Number Number
Finance and Administration         10 5
At the end of the year there were nine members of staff in Concateno plc.
Their aggregate remuneration comprised:
         2008 2007 
         £’000 £’000
Wages and salaries         948 1,825
Share based payments         235 149
Social security costs         123 178
Other pension costs         121 76
          1,427 2,228 63
Concateno plc 
Annual Report and Accounts 2008
C3 Investments
The Company has investments in the following subsidiaries which principally affected the profits or net assets of the Group:
Please see Note 28 for a complete listing of subsidiaries and holdings.
 
Cost          £’000
At 1 January 2008           135,033
Additions          1,278
At 31 December 2008           136,311
C4 Intangible assets
          Total 
          £’000
Cost
At 1 January 2008          –
Additions          8
At 31 December 2008          8
Amortisation
At 1 January 2008          –
Amortisation for the year          –
At 31 December 2008          –
Carrying amounts
At 1 January 2008          8
At 31 December 2008          8
C5 Tangible assets
         Plant and  
         machinery Total 
         £’000 £’000
Cost
At 1 January 2008         109 109
Additions         3 3
At 31 December 2008         112 112
Depreciation
At 1 January 2008         5 5
Depreciation for the year         13 13
At 31 December 2008         18 18
Carrying amounts
At 1 January 2008         104 104
At 31 December 2008         94 94
C6 Debtors 
         2008 2007 
         £’000 £’000
Amounts owed by Group undertakings        5,857 7,967
Other debtors, prepayments and accrued income       269 627
Deferred tax asset         65 161
           6,191 8,755
C7 Creditors 
Creditors: amounts falling due within one year
         2008 2007 
         £’000 £’000
Bank loans and overdrafts          27,701 5,206
Trade creditors         262 1,142
Amounts owed to Group undertakings        6,408 5,464
Accruals and deferred income         509 693
           34,880 12,505 Concateno plc 
Annual Report and Accounts 2008 64
C7 Creditors continued
Creditors: amounts falling due after more than one year
         2008 2007 
         £’000 £’000
Bank loans          – 24,738
Other loans*         – 8,720
          – 33,458
Debt costs arising on arranging the bank loans above are being amortised over the life of the loans to which they relate. As at 31 December 
2008, the unamortised element amounted to £263,000 (2007: £492,000). The balances disclosed above are net of these unamortised 
debt costs.
Terms and debt repayment schedule
Terms and conditions of outstanding loans were as follows:
       31 December 2008  31 December 2007
     Nominal  Face  Carrying Face Carrying 
     interest rate Year of Value amount value amount 
    Currency % maturity £’000 £’000 £’000 £’000
Secured bank loan    GBP 6.21* 2008 – – 3,750 3,521
       2009 25,001 24,737 25,000 24,738
Convertible loan    GBP 12.5 2009 – – 8,720 8,720
        25,001 24,737 37,470 36,979
* The effective interest rate changes with the underlying LIBOR rate (being set as three month LIBOR + 3% margin), but is correct as at 31 December 2008. See Note 19 for  
further details.
The bank loans are secured over the assets of the holding company and all subsidiaries and security be created over shares or quotes in the 
capital of all companies that fall within the Concateno Group with a carrying amount of £25.0m (2007: £28.8m).
The secured bank loan is disclosed as falling due within one year even though refinancing negotiations are currently underway. The full 
repayment profile, by tranche, of the secured bank loan is detailed in Note 18 to the Consolidated Group accounts.
See Financial Review on pages 13 to 15 for further detail on term loan refinancing.
C8 Called-up share capital
         2008 2007 
         £’000 £’000
Authorised share capital:
150,050,000 ordinary shares of £0.10 each (2007: 150,050,000 shares)      15,005 15,005
Allotted, called up and fully paid
106,139,707 ordinary shares of £0.10 each (2007: 95,299,415 shares)      10,614 9,530
C9 Reserves
       Share  Profi t  
       Premium Merger and Loss  
       Account Reserve Account Total 
       £’000 £’000 £’000 £’000
Balance at 1 January 2008       89,875 7 ,844 (8,629) 89,090
Premium arising on issue of ordinary shares      185 – – 185
Conversion of loans       9,011 – – 9,011
Exercise of share options       75 – – 75
Dividends receivable       – – 3,580 3,580
Share-based payment regarding employee options     – – 253 253
Loss for the financial year       – – (4,996) (4,996)
At 31 December 2008       99,146 7,844 (9,792) 97,198
Notes to the Company Balance Sheet  > continued Contents
01 Highlights
02 Group overview – our products and services 
04 Group overview – our geographical reach
06 Group overview – the markets we operate in
08 Chairman’s Statement
10 Chief Executive Officer’s Review
13 Financial Review
16 Board of Directors
17  Financial Statements index
18 Directors’ Report 
21 Corporate Governance Report
24 Directors’ Remuneration Report
26 Statement of Directors’ Responsibilities
27 Independent Auditors’ Report
28 Consolidated Income Statement
28  Consolidated Statement of Recognised Income  
and Expense
29 Consolidated Balance Sheet
30 Consolidated Cash Flow Statement
31 Notes to the Consolidated Financial Statements
61  Company Balance Sheet
62  Notes to the Company Balance Sheet
65 Advisers
Concateno is a global provider of drug and alcohol testing 
and related services as well as a manufacturer of clinical 
diagnostic products. 
 
Drug and Alcohol abuse is a growing problem in society. 
Concateno is at the forefront of this issue, working with 
governments, employers and healthcare and law 
professionals to help reduce the impact of this problem. 
Our expertise is unmatched and our staff are passionate 
about working with clients to identify the best possible 
solutions for them. 
 
Following the successful integration of our subsidiary 
businesses, Concateno can now provide the optimal type 
of drug testing in any biological sample.  
 
Building on our expertise in Europe the Company is now 
poised to both expand geographically and to develop new 
market sectors.  
Cozart
® 
DDS: the Group’s leading oral fluid testing 
device, field proven with police forces and 
employers internationally.
Advisers >
Registered Office
Concateno plc
10 Buckingham Street
London
WC2N 6DF
Registered Number
05396234 England and Wales
Nominated Adviser and Broker
Collins Stewart (Europe) Limited
9th Floor
88 Wood Street
London
EC2V 7QR
Joint Brokers
SingerCapital Markets Limited
One Hanover Street
London 
W1S 1AX
Evolution Securities Limited
100 Wood Street
London EC2V 7AN
Solicitors to the Company
Jones Day
21 Tudor Street
London
EC4A 0DJ
Auditors
KPMG Audit Plc
1 Forest Gate
Brighton Road
Crawley
RH11 9PT
Principal Bankers
Barclays Bank plc
Head Office Branch
1 Churchill Place
London
E14 5HP
Public Relations Advisers
Financial Dynamics 
Holborn Gate
26 Southampton Buildings
London 
WC2A 1PB
Company Secretary
Rowena Nixon
10 Buckingham Street
London 
WC2N 6DF
Registrars
Capita Registrars
The Registry
34 Beckenham Road
Beckenham
Kent
BR3 4TU
Patent Agents
Marks and Clerk
4220 Nash Court
Oxford Business Park South
Oxford OX4 2RU oncateno plc oncateno plc
Concateno plc  Annual Report and Accounts 2008
Annual Report and Accounts 2008 
Concateno plc
10 Buckingham Street
London
WC2N 6DF
T +44 20 7004 2800  
F +44 20 7004 2801
E info@concateno.com
www.concateno.com
Linking it all together