Cosalt plc 
Annual report  
& financial statements 2009
Safety 
critical
Cosalt plc
Fish Dock Road
Grimsby
North East Lincolnshire 
DN31 3NW
Telephone 01472 504 504
Facsimile 01472 504 369
www.cosalt.com
Registered Number 19628
Cosalt plc Annual report & financial statements 2009 Acknowledgements
Cosalt would like to thank all those who participated in producing  
this report, particularly the members of staff for their contributions.
Main photography by Charlie Fawell 
Board photography Mike Ellis
Designed and produced by 
The College  www.thecollege.uk.com
Printed in the UK by Empress Litho
In 2009 Cosalt Compliance  
was successful in obtaining the 
ISO-14001 Environmental standard.
In 2009 the new Premier 2010 lifejacket 
aimed at the cruise and ferry market  
won a Safety at Sea innovation award.
ISO 14001
BUREAU VERITAS
Certification
Overview
Safety critical
 Overview
01 Strategic & operational highlights
02 At a glance
04 Chairman’s statement
 Business review
06 Chief Executive’s review
08 Financial review
10 Our responsibilities
12 Principal risks
14 Divisions: Offshore
18 Divisions: Marine
 Governance
22 Board of directors
24 Directors’ report
26 Remuneration report
29 Corporate governance
 Financial statements
33 Independent Auditors’ report
34 Consolidated income statement
35 Consolidated balance sheet
36  Consolidated statement of recognised 
income and expense
37 Consolidated cash flow statement
38 Notes to the financial statements
69 Company balance sheet
70  Company reconciliation of movements 
in shareholders’ funds
71  Notes to the Company financial 
statements
 Company information
80 Advisers and financial calendar
Cosalt’s objective is to become  
a leading provider of critical safety 
equipment and services for the 
highly regulated Offshore and 
Marine industries for people exposed 
to hostile work environments  01 Cosalt plc Annual report & financial statements 2009
Strategic & operational highlights Overview
Strategic & operational 
highlights
Divisions 
Cosalt Offshore
Read more on page 14
Cosalt Marine
Read more on page 18
Revenue 2009 (2008: £105.0m)
£ 1 07. 8 m
Key objectives met for restructuring the business:
•	 Sc h oo l w e a r 	 a n d 	 H o l i d a y 	 H o m e s 	 b usi n e ss e s 	 e x it e d
•	 	 Gr o u p ’ s 	 l o n g -t e r m 	 ca p it a l 	 s tr u c t u r e 	 a d d r e ss e d 	 w ith	 
the raising of £17 million net
•	 A 	 g r e at e r 	 f o c us 	 o n 	 e x e c uti n g 	 o u r 	 co r e 	 s tr at e g y
Ongoing market focus: 
• 	 P r o d u c t s 	 a n d 	 s e r v i c e s 	 p o r t f o l i o 	 e x t e n d e d	
•	 	 L o n g -t e r m 	 r e si l i e n c e 	 o f 	 b usi n e ss 	 m o d e l 	 u n d e r p i n n e d	 
by regulatory drivers
•	 N u m b e r 	 o f 	 k e y 	 co n tr a c ts 	 w o n 	 a n d 	 e xt e n d e d 	 i n c l u d i n g :
	 – 	 A 	 th r e e -y e a r 	 co n tr a c t 	 e xt e nsi o n 	 w ith 	 PSN 	 w o rth 	 £ 1 8 	 mi l l i o n
	 – 	 A 	 th r e e -y e a r 	 co n tr a c t 	 w i n 	 w ith 	 B P 	 w o rth 	 £ 1 . 5 	 mi l l i o n 	 p e r 	 a n n u m
	 – 	 A 	 t h r e e - y e a r 	 c o n t r a c t 	 w i t h 	 S u b s e a 7 	 i n 	 N o r w a y	
Other actions:
•	 R e d u c ti o n 	 i n 	 n e t 	 d e b t 	 t o 	 £ 1 8 .6 	 m i l l i o n 	 (20 08 	 £ 2 6 . 8 	 mi l l i o n )
• 	 P e n s i o n 	 s c h e m e 	 i s s u e s 	 b e i n g 	 a d d r e s s e d	
• 	 	 A n n u a l i s e d 	 c o s t 	 s a v i n g s 	 o f 	 £ 3 	 m i l l i o n 	 a l r e a d y 	 i m p l e m e n t e d ;	 
f u rth e r 	 a c ti o n 	 b e i n g 	 t a k e n 	 i n 	 20 1 0 02 Cosalt plc Annual report & financial statements 2009
At a glance Overview
A t 	 a 	 g l a n c e
Our vision
To be the specialist global provider  
and through life manager of critical 
s af e ty 	 e q u i p m e n t 	 f o r 	 p e o p l e 	 e x p o s e d	 
to hostile environments
Our objectives
• 		 B e co mi n g 	 a 	 sp e c i a l is t 	 p r o v i d e r 	 o f	
critical safety equipment and services 
for the highly regulated Offshore and 
M a r i n e 	 i n d u s t r i e s 	 f o r 	 p e o p l e 	 e x p o s e d	
t o 	 h o s ti l e 	 w o r k 	 e n v i r o n m e n ts
• 		 B e co mi n g 	 a 	 m a j o r 	 g l o b a l 	 p l a y e r	 
in a market underpinned by strict 
regulatory obligations
• 	 	 P r o v i d i n g 	 e q u i p m e n t 	 a n d 	 s e r v i c e s	 
t o 	 th e 	 r e n e w a b l e 	 e n e r g y 	 s e c t o r
Our strategy
• 		 B u i l d 	 o u r 	 co r e 	 c r iti ca l 	 s af e ty	 
equipment and services activities
• 		 B u i l d 	 a 	 h i g h 	 q u a l ity 	 b l u e - c h i p	 
customer base
• 	 	 B r o a d e n 	 o u r 	 e x i s t i n g 	 p r o d u c t s	 
and services
• 	 	 E x p a n d 	 t h e 	 G r o u p ’ s 	 g e o g r a p h i c	
coverage
Our divisions
Offshore
Cosalt Offshore aims to consolidate  
i t s 	 m a r k e t 	 l e a d i n g 	 N o r t h 	 S e a 	 p o s i t i o n	 
and build presence in an estimated 
£ 4. 5 	 b i l l i o n 	 g l o b a l 	 a r e n a
Opportunities
•  Expansion of specialist ropes sales via  
Bridon agreement
• Non destructive examination of wire rope
•  Introduction of lifeboat inspection and services  
in Offshore
• Establishment of technical compliance operation
• New facility at Kristiansund, Central Norway
• Introduction of tool facilities at Stavanger, Norway
• Opportunity to tender on new contracts
Read more on page 14
 
Marine
Cosalt Marine aims to build on  
i t s 	 e x i s t i n g 	 s t r o n g 	 E u r o p e a n 	 b a s e	 
a n d 	 l e v e r a g e 	 its 	 e x is ti n g 	 g l o b a l	
market share
Opportunities
•  Expanding fire protection and lifeboat services across  
Europe using successful model in Antwerp operation
• Exploiting opportunity to improve margin performance
• Developing lifejacket markets
•  Increasing sales of liferafts and an increase of long term 
liferaft hire
•  Improving the product range offering relation HS&E 
added value technologies
Read more on page 18 03 Cosalt plc Annual report & financial statements 2009
Overview At a glance
W h a t 	 w e 	 do
L if e r af t s
Commercial liferafts, Leisure liferafts, Marine Evacuation 
Systems (MES), Inflatable rescue boats
L if e boat s
Fully enclosed lifeboats, Open lifeboats, Free fall 
lifeboats, Davits and winches, GRP/Engine repair,  
Metal fabrication facility
L ife ja c k e ts
Market leading ‘Premier 2010’, inherently buoyant 
lifejackets, Commercial inflatable lifejackets including 
SeaCrewsader offshore lifejacket, Leisure lifejackets, 
Buoyancy aids, Immersion suits
Fire safety
Fire suppression systems, Breathing apparatus, Gas 
detection equipment, Fire hoses and accessories, Fire 
extinguishers, Fire suits, Specialist fire-protection clothing
L ift ing / t o oling 	 & 	 in s p e c t i o n
On/offshore test and inspection services, Tool/lifting 
equipment hire, Pneumatic/hydraulic/electric tools, 
Non-destructive testing, Fall arrest equipment,  
Working at Height equipment, Refurbishment services
Wire & fibre ropes
Exclusive offshore distributor for Bridon wires, Specialist 
wire rope, Spooling services, Wire and fibre rope slings, 
Single point mooring systems (SPM’s), Specialist fibre 
ropes, Wire and fibre rope rigging services
Saf e ty 	 w o r kw e a r
Complex PPE, Structural fire fighting kit, Technical 
Rescue suits, High visibility garments, Flame retardant 
Public Order coveralls, MOD cold weather garments  
and aircrew coveralls, Bespoke branded workwear
Cosalt Compliance
Independent Competent Person, Written Scheme of 
Examination, Compliance Audits (KP2), Training & 
competence, Funis Veritas wire rope management system
H o w 	 w e 	 m e a s u r e	
ourselves
T h e 	 Gr o u p ’ s 	 m a n a g e m e n t 	 m o n it o rs 	 th e	
performance of the business by regular 
comparison of actual results compared 
to budgets, forecasts and prior years.  
It 	 is 	 a ls o 	 d e v e l o p i n g 	 a 	 w i d e r 	 r a n g e 	 o f	 
K e y 	 P e rf o r m a n c e 	 I n d i cat o rs 	 (K P I ’ s)
Revenue (£m) 
Total revenues, excluding discontinued operations
66.9
105.0
07
08
09 107.8
Headline operating profit (£m) 
Operating profit excluding special items and discontinued operations
2.7
9.5
07
08
09 8.6
Headline EPS (pence) 
Post-tax profit excluding special items and discontinued operations
0.58
7.71
07
08
09 4.20
Cash generated from operations (£m) 
Cash generated excluding special items
5.7
6.7
07
08
09 1.6
Number of accidents per 100 employees 
The Board monitors monthly statistics on all accidents throughout the Group
2.9
2.1
07
08
09 0.85 04 Cosalt plc Annual report & financial statements 2009
Chairman’s statement Overview
Ch airman ’ s 	 s t a t e me n t
We are making good progress in 
g r o w i n g 	 o u r 	 b u s i n e s s 	 i n 	 t h e 	 O f f s h o r e	
and Marine industries
Overview
I am pleased to report that the Group continues to make 
progress towards its strategic objectives of becoming  
a specialist provider of critical safety equipment and services 
for the Offshore and Marine industries.
In August we announced a placing and fundraising to raise  
£17 million, net of expenses, which has provided the Group  
with financial stability and security to conduct its business  
and enable us to pursue our strategy.
Since our exit from the Holiday Homes business in November 
2008, we have focused on our core activities and aim to 
establish Cosalt over the longer-term in the international 
Offshore and Marine sectors. Given the geographical proximity 
between our European branch network and recent franchise 
awards for the Offshore renewable energy sector, we are 
hopeful we can offer our existing services into this growing 
Offshore activity.
In May, the Company entered into an agreement with Bridon 
International Limited, a major specialist wire rope manufacturer, 
to develop and expand its Aberdeen based activity serving the 
UK North Sea Offshore sector. Since the year end we have also 
secured a number of key contracts in both the Offshore and 
Marine divisions. The Group’s development will continue to be 
driven primarily by organic growth across both divisions where 
there remains scope for us to increase our market share. 
Results & financing
As previously reported, conditions in the Group’s markets 
became more difficult over the course of 2009. In the Oil and 
Gas sectors, the falling oil prices at the beginning of 2009 
prompted customers to defer spending. Similarly in the Marine 
sector, port activity and the volume of container traffic 
(particularly in Northern Europe) reduced. Market conditions  
in both the Offshore and Marine sectors in the first half of 2010 
continue to prove challenging.
Group turnover from continuing operations for the year was 
£107.8 million (2008: £105.0 million), a 2.6% increase. 
Headline operating profit from continuing activities was  
£8.6 million (2008: £9.5 million) while corresponding headline 
earnings per share were 4.2p (2008: 7.71p). Statutory loss  
for the period was £2.6 million (2008: £24.8 million) with 
corresponding loss per share of 2.93p (2008: loss 32.52p).
Following the approval of the Placing and Open Offer and  
Firm Placing at the General Meeting on 1 September 2009,  
the Group received net proceeds of £17 million which enabled  
it to reduce net indebtedness and achieve a more stable, long 
term funding structure. The strengthened financial position  
of the Company will facilitate the long term implementation  
of the Group’s strategy. Net debt at November 2009 stood  
at £18.6 million (2008: £26.8 million). 05 Cosalt plc Annual report & financial statements 2009
Overview Chairman’s statement
The Company issued 180,000,000 New Ordinary Shares 
through the Placing and Open Offer and 198,000,000  
New Ordinary Shares through the Firm Placing at a price  
of five pence per New Ordinary Share. 
We continue to manage our cost base down and cash 
management remains a priority. We have implemented a cost 
reduction programme across the Group which delivered net 
savings of approximately £1 million during the last financial  
year and annualised savings of £3 million. In addition to this, 
further cost cutting is being implemented in 2010.
Dividend
The Board has concluded that the current priority must  
be to conserve cash, and maintain a robust financial base from 
which to pursue the Group’s strategy and increase shareholder 
value. Accordingly, it is not recommending a final dividend  
be paid. The Board will continue to review its dividend policy  
on a regular basis, and will take account of the trading and 
strategic priorities in considering the level of future dividends.
Pensions
The Group’s defined benefits pension scheme was closed  
to future accrual on 31 December 2006 and active members 
were transferred into a stakeholder defined contribution  
plan. The deficit in the pension scheme according to 
International Accounting Standards has risen to £11.8 million 
(2008: £6.3 million), largely as a result of falling bond yields. 
Addressing the pension deficit is of primary importance  
for the Group.
Board & management
During the course of the year we have made three new 
additions to the Board. Calum Melville, currently responsible for 
our Offshore division, joined the Board as an Executive Director. 
We also appointed two new Non-Executive Directors. Maurice 
White is a mechanical engineer with a wealth of experience  
in the Oil and Gas industry, and Simon Gilbert has worked in  
a number of operational and investing roles and is a Managing 
Partner with Hanover Investments. I was re-appointed as 
Chairman, replacing David Hobdey who stepped down from  
the Board in November 2009. John Kelly, who was Chairman  
of the Group between 2005 and 2008, retired in January 2010 
after 22 years with the Group. On behalf of everyone at Cosalt  
I would like to thank David and John for the contribution they 
have made to the Group.
Current trading & outlook
Last year was one of consolidation for our core businesses  
and above all, we established a strong platform from which to 
develop the business. The Group is now focused on building  
its core critical safety equipment and services activities. We 
continue to make progress in establishing Cosalt as a specialist 
provider of critical safety equipment and services for the 
Offshore and Marine industries.
The market environment continues to be challenging as our 
customers delay investment decisions. However, we have taken 
action to reduce costs in response to the resulting lower 
revenues. Importantly, we have been successful in renewing 
and winning a number of new contracts which will contribute  
to an improvement in trading in the second half of the year.
David Ross
Chairman
2 February 2010
David Ross
Chairman
Placing and Open Offer and Firm Placing (net of expenses)
£1 7.3m 06 Cosalt plc Annual report & financial statements 2009
Chief Executive’s review Business review
C h i e f 	 E x e c u t i v e ’ s 	 r e v i e w
Strategy
I am pleased to report that we continue to benefit from the 
implementation of our strategy to become a specialist provider 
of critical safety equipment and services for the highly regulated 
Offshore and Marine industries. 
Through our two core divisions, Offshore (Oil and Gas) and 
Marine (Commercial & Cruise), the Company has developed  
a reputation for quality and reliability, and we have made great 
strides in targeting companies in highly regulated industries 
overseen by national governments and a common international 
platform. We work closely with advisory regulators such as the 
International Maritime Organisation (IMO).
Globally, the Offshore and Marine sectors we serve have  
an annual worth of approximately £4.5 billion and £1 billion 
respectively. Working within the frameworks of these markets  
is expected to underpin the Company’s growth prospects  
going forward.
We are building a high quality blue-chip customer base and 
focusing on larger operators who are increasingly wishing to 
work with fewer contractors on a longer-term partnership basis, 
in order to meet their global needs. In meeting our customers’ 
needs with their own development plans we are broadening  
our existing product range.
 
Today, Cosalt is predominantly a European operator but as  
our markets improve and our customers seek to extend their 
geographic reach then we will have the opportunity to support 
them in their expansion through the provision of products  
and services. 
Not only are we looking to expand our product and service 
offering but, due to the fragmented nature of the industry, we 
are also looking for opportunities to identify and make selective 
value enhancing moves to bolster our business portfolio.  
In addition, we intend to expand our businesses into emerging 
markets wherever they fit in with our core areas of expertise.
Operations 
Cosalt Offshore
Cosalt Offshore reported turnover of £44.3 million (2008:  
£41.8 million) and operating profit before special items of  
£5.3 million (2008: £8.3 million) for the year.
Cosalt Offshore operates out of three sites – Aberdeen, 
Stavanger and Lowestoft – and this gives us a pan-North Sea 
network of service and rigging centres. The division supplies, 
inspects, tests, maintains and manages a wide range of safety 
equipment from portable lifting equipment to lifeboats and 
liferafts. We also supply and service powered hand tools, 
Drager gas detection and breathing apparatus, working at 
height equipment and provide inspections on offshore fixed 
platforms and portable rigs.
We have experienced difficult trading conditions in the North 
Sea Oil and Gas sector over the past 12 months, with most 
clients tightening their investment commitments, particularly  
on capital expenditure projects. We have introduced new 
services to our client base such as wire rope and lifeboat 
services and this is going some way to make up for the shortfall 
in traditional business.
The division has been awarded a number of contracts including 
a three-year contract with BP , worth up to £4.5 million to  
supply all lifting equipment to BP and its subcontractors in  
the North Sea. We have also secured a three-year extension  
to our existing contract with CNR for lifting and inspection 
services in the North Sea and a one-year contract for crane 
inspection services with Subsea7 in Norway. We have also 
agreed a three-year contract extension with PSN, our largest 
customer, worth up £18 million to supply lifting and tooling 
equipment in the North Sea. Group revenue increased in the 
year as a result of a full year’s trading of the Norwegian 
acquisition. Margins were however, impacted as drilling projects 
were curtailed. 
We are a strongly focused and 
streamlined business, in good shape 
to deliver on our strategic objectives
Headline operating profit (2008: £9.5m)
£8. 6 m 07 Cosalt plc Annual report & financial statements 2009
Business review Chief Executive’s review
We launched Funis Veritas, a wire rope integrity management 
system, which complements our new business with Bridon 
International and includes the supply of specialist wire ropes. 
The initial response to this system, which monitors and controls 
the through-life integrity of large wire ropes, has been very 
positive with orders for both the management system and wires 
already in place.
Market conditions in 2010 are expected to continue to be 
challenging, however our product and service offering should 
give us an advantage over our competitors to secure new 
contracts in 2010, whilst cost reductions will form an important 
factor in maintaining profitability. 
Cosalt Marine
The Marine division delivered turnover of £63.6 million  
(2008: £63.2 million) and operating profit before special items 
of £4.9 million (2008: £2.1 million) through a number of 
significant contract wins and contract renewals.
The division, which comprises four main business units, namely 
UK Marine, Continental Marine, Crewsaver and Workwear,  
has a particular focus on regulated and legislated safety. 
Cosalt Marine secured and extended major contracts within  
all business areas including Netherlands MOD, UK MOD 
lifejackets and buoyancy aids, further cruise vessel lifejacket 
and liferaft hire contracts, a two-year extension with Network 
Rail for hi-visibility workwear, and a three-year contract  
with Babcock Rail for hi-visibility workwear. Additionally, the 
division won several other new contracts within the marine  
and industrial sectors that have excellent potential for further 
development.
During the year we launched several key new products in the 
marine sector including Crewsaver designed inherent and 
inflatable lifejackets. The recently introduced SeaCrewsader 
lifejacket achieved particular success in the North Sea offshore 
market and the new Premier 2010 lifejacket aimed at the cruise 
and ferry market won a Safety at Sea innovation award. This 
product was introduced to the market with advanced orders  
in line with the Board’s expectations. In the coming year, 
Crewsaver is launching a new range of Crewfit 190N single  
and twin chamber inflatable lifejackets. These products have 
already been well received by both customers and distributors.
Our Workwear business has developed a number of new 
products including hi-visibility clothing for use on the UK rail 
network and police public order clothing. It is currently working 
on a number of key competitive tenders including several  
major fire clothing fully managed service contracts, and  
we are looking to develop our product range offering across  
all business sectors. In particular, we are aiming to expand  
our lifeboat and fire equipment servicing on the continent and 
our existing liferaft hire contracts. We are also looking to secure 
the supply of new safety equipment to the cruise and ferry 
market with our new product designs and proven service 
model, we are well placed to secure further new business. 
In Marine, whilst shipping activity is still low, this is, in part, 
compensated by increased demand for Crewsaver branded 
products and some signs of renewed activity on UK lifting 
projects.
The actions which are being taken to align the cost base with 
current trading conditions will support the profitability of the 
Company in anticipation of an upturn in market activity.
Summary
We have achieved a number of key objectives over the past  
12 months, in particular exiting from the Company’s legacy 
businesses; strengthened the Group’s management team; 
focused our long-term strategy; and addressed the Group’s 
optimal long-term financing structure.
Although there is still much to do, we are now a more 
streamlined business, with a much improved capital structure 
and despite the challenging market conditions we can look  
to the future with momentum in our chosen market sectors.  
We are now well positioned to implement the next phase  
of our strategic development and I look forward to reporting  
on further progress in due course.
Mark Lejman
Chief Executive
2 February 2010
Mark Lejman
Chief Executive
Group revenue (2008: £105.0m)
£ 1 0 7. 8 m 08 Cosalt plc Annual report & financial statements 2009
Financial review Business review
F in a n c ia l 	 r e v ie w
Results
Revenue
The revenue for the Group from continuing operations was 
£107.8 million, an increase of £2.8 million from the previous 
year. The change reflects the positive effect of a full year of the 
acquisition of Myhre-Maritime, an increase from the movement 
of the euro versus the pound being offset by activity reductions 
arising from the economic environment. 
Operating profit
Operating profit reduced from £9.5 million to £8.6 million. This 
significantly reflects the difficult economic environment which 
has put volumes and margins under pressure. 
In the last part of the year there has been a significant cost 
reduction exercise which has saved approximately £3 million  
on a full year basis. This was instigated as a reaction to the 
decline in demand and pressure on margins. 
Finance costs
Financing costs are principally interest (including interest rate 
hedges) on bank debt and the financing cost of the defined 
benefit pension schemes. 
The financing costs for bank debt was £2.5 million an increase 
over the prior of £800,000. This reflects the increased 
borrowings throughout the year and the increased margin 
following renegotiation of facilities during the year. 
Details of the financing cost to the pension scheme are set out 
in note 27. 
Special items
Details of the special items are set out in notes 3 and 6 to  
the accounts. 
Special items charged to operating profit are £7.1 million  
include £3.1 million of intangible write downs in respect of 
customer contracts relating to acquisitions. The balance  
of £4.0 million are significantly generated from reorganisation 
within the Group to reduce the cost base and eliminate loss 
making activities. 
The special item relating to financing costs represents 
renegotiating bank facilities (both fees paid to banks and 
professional fees) and a discount to secure early payment  
of loan notes arising on the sale of Banner. 
Tax
The income tax charge on the profit before taxation  
(excluding special items) is £1.8 million (2008: £1.3 million) 
which represents an effective rate of 32.5% (2008: 18.6%). 
Cash tax payments in the year were £2 million. 
Based on the loss before tax, after special items the tax credit 
for the current year is £0.8 million (2008: charge £0.9 million).
Earnings per share
The dilutive earnings per share from continued operations, 
before special items, were 4.17p (2008: 7.70p). This reflects  
the dilutive effect of the placing and the decrease in profitability. 
The dilutive earnings per share from total operations after 
special items represented a loss of 2.93p (2008: a loss of 
32.52p). The significant loss in the previous year was due to the 
write offs arising from the sale of Holiday Homes and Banner. 
Dividend
No dividend has been proposed for 2009. The board is, 
however, committed to a progressive dividend policy and 
intends that Cosalt will resume dividend payments, when  
the markets have stabilised and they believe it is prudent to  
do so, taking into account the Group’s earnings, cash flow  
and balance sheet position. 
Balance sheet
Shareholders’ funds
The consolidated shareholders’ funds are £49.4 million  
(2008: £37.6 million). The increase reflects the impact of the 
placing, more than offsetting decreases arising from the overall 
result for the year and an increase in the pension deficit. 
Bank facility
As described in last year’s accounts the Group had agreed with 
its bankers to increase its facilities from £34 to £39 million and 
granted security to the banks. Since then as part of the placing 
the facility has been reduced to £33 million – details of this 
facility are in note 20. 
T h e 	 f u n d r a i s i n g 	 w a s 	 a 	 k e y 	 m i l e s t o n e	
f or 	 C osa l t 	 a n d 	 r e p r e s e n t e d 	 a 	 n e w	
chapter in our development 09 Cosalt plc Annual report & financial statements 2009
Financial review Business review
Interest rate and foreign exchange risk management
In order to provide protection against significant interest rate 
changes, as reported in the previous year’s accounts, the board 
purchased a cap. The amount covered by the cap reduces in line 
with repayments on the then term loan. A floor transaction was 
taken out at the same time and on the same basis in order to 
minimise the upfront premium for this cover. As part of the 
refinancing done in the current year two additional hedging 
instruments have been taken out that are relatively immaterial  
to the cap referred to earlier. 
The Group takes out a series of forward exchange contracts  
to cover purchases overseas – principally US dollars. In addition 
the Group carries a euro loan to cover the balance sheet risk  
as a natural hedge against its investment in the European Marine 
business.
Placing
During the year the Group carried out the Placing and  
Open Offer and Firm Placing to raise approximately £17 million 
net of expenses. 
Cash flow
The movement in net debt can be summarised set out in the 
table below:
 £m  £m 
 08/09  07/08 
From operations (6.3)  1.8 
Taxes paid (2.0)  (1.3) 
Net cash from operating activities (8.3)  0.5 
Acquisitions –  (1 1.2) 
Net cash from other investing activities –  (2.2) 
Proceeds from share placings 17.3  2.9 
Movement in loans (9.4)  26.2 
Dividends –  (2.5) 
Net cash from other financing activities (0.4)  (0.3) 
Net cash movement (0.8)  13.4 
 
Movement in loans 9.4  (26.2) 
Other (0.4)  0.4 
  
Opening net debt  (26.8)  (14.4) 
  
Closing net debt  (18.6)  (26.8) 
 £m  £m 
 08/09  07/08 
Profit before tax (3.3)  1.4 
Depreciation 2.2  4.9 
Amortisation 3.8  2.7 
Inventory 0.5  (3.3) 
Debtors 5.1  1.7 
Payables (14.4)  6.7 
Loss on disposal 0.0  (1 1.7) 
Other (0.2)  (0.6) 
Total (6.3)  1.8 
  
£17.3 million fund raising 
£8.2 million reduction in net debt
£14.4 million reduction in payables
Defined benefit schemes
The Group has one significant and a number of small defined 
benefit schemes. 
The year end deficit (net of tax) is £8.5 million (2008: £4.5 million). 
The increase principally relates to the fall in bond yields 
between the valuation dates which has increased the present 
value of the liabilities. 
The main Group scheme was closed to future accrual on  
31 December 2006 and all current members were offered 
membership of a defined contribution scheme. The Group  
is currently making payments of £100,000 per month to the 
Trustees to reduce the deficit. 
On behalf of the Board
Mike Reynolds
Finance Director
2 February 2010
 
Mike Reynolds
Finance Director 10 Cosalt plc Annual report & financial statements 2009
Our responsibilities Business review
Our responsibilities
Our people
It comes as no surprise for a marine safety business that
in a recent survey, our people gave high ratings for having pride 
in quality and service levels, job satisfaction and the quality  
of our teamwork. Indeed, our ethos is one in which we 
methodically and expertly strive to deliver failsafe solutions to 
protect the lives of those who operate in hostile environments. 
This value set underpins all our human resources policies and 
gives us a framework for achieving our business objectives 
through our people.
Our workforce – key statistics
The difficult economic conditions have proved to be challenging 
over the last year. As a result, and in order to increase our 
effectiveness we have undertaken a careful review and 
streamlined our workforce to an optimum level. This has 
resulted in a decrease in our total employee headcount from 
1,407 to 822 over the past 12 months. However, 90% of this 
reduction was as a result of the disposal of our Schoolwear and 
Holiday Homes businesses. Despite the necessary changes, 
we are confident that we retain the loyalty and commitment  
of all our remaining staff and we believe that a “team spirit”  
has developed as everyone has pulled together. We are firmly  
of the opinion that our employees are our key resource and  
we value them very highly.
Diversity
The very nature of our marine safety business requires us to
serve our customers wherever they are. We have developed  
a presence in principal ports across the UK and Continental 
Europe. At each location there is a unique culture; there are 
core themes such as a shared commitment to quality and 
safety, and a meticulous and informed approach to the way  
we deliver our products and services. There are also subtly 
diverse styles which reflect our locations, their nationalities  
and their customers. Our aim is to ensure that we capitalise  
on the opportunities that having a diverse workforce offers us, 
and that our workforce reflects the diversity of our locations. 
Recruitment
The bulk of our recruitment activity has always been to ensure 
that we are served by the most technically able, whether it be 
service engineers or sales and service staff. The composition  
of our workforce has therefore changed to reflect the 
broadening nature of our work. Our aim is to provide fulfilling 
and enriching careers and to support this we offer our 
employees opportunities for training, personal development 
and growth.
Development, training and employee engagement 
We have recognised the need to track the capabilities and 
development areas of our people to ensure that we can deliver 
on our promises to our customers. Our Personal Development 
Planning processes continue to develop and help us to manage 
our people. A survey showed that our people strongly share  
a clarity of precisely what is expected of them in their job roles, 
and this has been fostered by an open and collaborative 
management style in which objectives are discussed and agreed.
In support of this we are building our capability to deliver  
a comprehensive range of employee development 
programmes, from compliance training for our engineers, 
through intensive health and safety qualifications for our line 
managers to advanced sales training. As the vanguard of our 
initiatives in the marine safety sector we have established 
Cosalt Compliance, a division within Cosalt which specialises  
in the delivery of technical excellence to our customers in both 
off- and onshore marine environments. To this end we have 
people with the requisite technical skills to provide leading-
edge practical safety and operational solutions in what  
is a highly regulated environment. This further enriches the 
opportunities for career advancement within our business. 
We strive to deliver failsafe solutions 
t o 	 p r o t e c t 	 t h e 	 l i v e s 	 o f 	 t h os e 	 w h o	
operate in hostile environments 11 Cosalt plc Annual report & financial statements 2009
Our responsibilities Business review
Environment
Caring for the environment is an integral part of our business 
strategy. We endeavour to achieve a high standard of 
environmental performance and to make a positive contribution 
to society through our products.
Our policy is to:
•  Comply with environmental legislation, regulation and other 
codes of practice (such as industry initiatives) and plan ahead 
for future requirements;
•   Monitor, evaluate and continuously improve environmental 
performance;
•   Respond to the needs and concerns of local communities;
•   Strive towards sustainability, balancing today’s needs with 
those of the future;
•   Improve employee awareness of environmental issues and 
encourage the sharing of experience and expertise amongst 
our businesses;
•   Minimise any adverse environmental impacts of the 
Company’s activities;
•   Aim to conserve resources by reducing waste and by 
recycling of materials wherever this is appropriate and 
economically practicable.
The policy is intended to provide the framework for setting  
and reviewing environmental objectives and targets. It is 
applied as the minimum standard across our business.  
Where individual businesses identify a need for additional,  
more stretching requirements, they are encouraged to build 
upon this policy. This helps us to maintain standards without 
restricting the development of any division.
Social and community
Wherever possible the Group’s businesses support a range  
of charitable and community projects consistent with the 
Company’s interests. 
Health and safety
The policy is applicable to all divisions and locations of  
Cosalt plc.
The statement is complemented by further Divisional Health 
and Safety Policy Statements and divisional arrangements  
for health and safety.
The Company is committed to providing and maintaining  
a working environment and practices which are safe, without 
risk to health and afford due consideration to the welfare of 
employees and other persons who are or may be affected  
by Company activities.
The Company Policy will be implemented through:
•   Ensuring that Divisional Health and Safety Policies and 
appropriate arrangements for Health and Safety are in place, 
communicated, understood and implemented effectively.
•  Ensuring that a safe working environment and safe systems  
of work are in place.
•   Ensuring the provision of adequate training, instruction and 
supervision for all employees in respect of Health, Safety, 
Welfare and general systems of work.
•    Ensuring controlled safe practices are in use for the handling, 
storage, processing and movement of materials and goods. 
Periodic review of policy, procedures, practices and statistics 
to ensure acceptable standards are maintained and to further 
reduce Health, Safety and Welfare risks where appropriate.
•   Compliance with relevant Health, Safety and Welfare 
Legislation and Codes of Practice.
All employees are reminded that their co-operation in achieving 
the objectives of this and other divisional policies for health  
and safety is essential and that there are legal obligations 
placed on them.
The Board considers on a regular basis the implementation  
of this policy and any other health and safety matters as may  
be brought to their attention. Where deemed necessary, the 
Board of Directors shall instigate appropriate corrective actions 
through divisional and/or safety management and shall further 
ensure that such actions are effective.
Cosalt’s own specialist service stations inspect, test, service and repair 
liferafts and other safety critical equipment.
No. of accidents per 100 employees
0 . 8 5 12 Cosalt plc Annual report & financial statements 2009
Principal risks Business review
P ri n c i p a l 	 ri s k s
Key markets
The Cosalt businesses are well positioned to benefit from 
potential growth in their market sectors. However, a substantial 
downturn in one or more of these key markets could have  
a material adverse impact on the Group. The Marine markets 
are subject to local and global influences and the Offshore 
businesses are affected by the international oil price.
Fluctuations in foreign currency
Many of the Cosalt businesses import a substantial amount  
of their products or raw material and hence have an exposure  
to foreign currency fluctuations, most notably the US dollar  
and the euro. In addition, particularly with the acquisition  
of businesses in Mainland Europe and Norway, there are 
increasing revenues in foreign currency. Whilst the Group seeks 
to mitigate the impact of these on the net cash flow, adverse 
movements in foreign currencies relative to sterling may lead  
to significant adverse movements in profitability and the Group 
balance sheet.
Safety issues
Because of the markets in which we operate and the customers 
we provide services and products to, we must (and do) place 
every emphasis on the safety of our products and services.  
We therefore control safety both externally and internally and  
it is treated as an absolute priority, with stringent monitoring  
and testing and the highest level of training for our staff.
IT systems
The company is currently reviewing its IT systems and taking 
steps to ensure that it is robust and able to meet our  
developing needs.
Fluctuations in revenue and expenses
The Group is subject to a number of external factors beyond  
its control such as general economic conditions, adverse 
movements in interest rates, seasonal and cyclical changes  
in revenue and legislative changes, which could result in 
significant variations in the operating results from period to 
period. In addition, the strategic changes taking place in the 
Group may result in acquisitions and disposals of businesses, 
which would significantly alter the Group’s revenue and
operating position.
Final Salary Pension Plan
The Group has an obligation to fund Final Salary Pension Plans 
and this creates an exposure to interest rates, inflation, 
investment returns and the longevity of the Plan members.  
The Group has eliminated these risks for future service by the 
closure of the Plan to future accrual from 31 December 2006.
The Company has now established a Pensions Review 
Committee who are considering ways to improve the 
investment strategy of the pension fund as well as ways to 
mitigate and manage liability. The Committee is taking expert 
external advice.
Whilst the risks noted above have been identified from the  
risk reviews undertaken throughout the Group, they do not 
comprise all the risks associated with the Group and there may 
be additional risks which have either been identified as not 
material or which are presently unknown which may have an 
adverse effect on the Group’s businesses.
T h e 	 C osa l t 	 b u s i n e s s e s 	 a r e 	 w el l	
positioned to benefit from potential 
g r o wt h 	 i n 	 t h ei r 	 m a r k e t 	 s e c t or s E x c e l l e n c e	 
in critical 
equipment 
management
Managing lifting equipment to ensure it is fit for 
purpose and fully traceable is critically important. 
Under legislation, loose lifting equipment and  
that for carrying persons must be examined every  
six months and fixed lifting every 12 months as  
a minimum. This applies to onshore and offshore 
platforms, onshore sites or vessels in UK waters. 
Cosalt has fully trained and competent specialist 
engineers to ensure that all requirements are 
complied with and the client is not exposed to risk.
13 Cosalt plc Annual report & financial statements 2009 14 Cosalt plc Annual report & financial statements 2009
Cosalt Offshore Business review
Cosalt Offshore
Our core business is to supply, inspect, test, maintain and 
manage a wide range of safety equipment from portable  
lifting equipment to lifeboats and liferafts. We also supply  
and service powered hand tools, Drager gas detection and 
breathing apparatus, as well as working at height equipment 
and we carry out inspections on offshore fixed platforms and 
portable rigs.
Objectives and strategy
Our objective is to become the leading provider in our specialist 
field. We will achieve this by delivering excellent customer 
service, comprehensive technical support and ongoing  
product innovation. This will drive our business forward and 
enable us to become the industry supplier of choice.
Our strategy for the year ahead is to grow our servicing 
capabilities and our service offerings. This will be achieved  
by focussing on developing new and innovative products and 
services by working in close partnership with our customers. 
Our overall strategy is one of growing market share through  
key account management and growth and development.
This years performance
Cosalt Offshore reported a turnover of £44.3 million (2008: 
£41.8 million) and an operating profit before special items of 
£5.3 million (2008: £8.3 million) during the period. The business 
was generated through the division’s three sites in Stavanger, 
Lowestoft and Aberdeen.
Although the past year has seen difficult trading conditions in 
the North Sea oil and gas sector, with most clients tightening 
their spending particularly on capital expenditure projects, it 
has been encouraging to see that our focus on the downstream 
oil production sector has helped maintain like-for-like revenue. 
With our core services built around legislation-backed 
regulatory requirements we are well positioned to sustain 
services and defend margins.
W e 	 w i l l 	 c on t i nu e 	 t o 	 f o c u s 	 on	
d e v e l o p i n g 	 n e w 	 a n d 	 i n n o v a t i v e	
p r o d u c t s 	 b y 	 w o r k i n g 	 i n 	 c l o s e	
pa rt n e r s h i p 	 w i t h 	 o u r 	 c u s t om e r s
Calum Melville
Chief Executive Cosalt Offshore
Offshore operating profit
£5. 3 m
Offshore revenue
£44 .2 m 15 Cosalt plc Annual report & financial statements 2009
Business review Cosalt Offshore
Key people
Cosalt Offshore employs over 300 people in the UK and 
Norway. Key individuals within the business are:
•   Calum Melville (40) Chief Executive Cosalt Offshore.
•  Mark Grant (42) Finance Director Offshore Division  
(appointed January 2010). 
•   Sandy Gowing (55) Technical Director. 
•   Stuart Melville (44) Operations Director Offshore Division. 
•   Lisa Mitchell (36) Commercial Director Offshore Division.
•  Jack Bråten (48) Managing Director Cosalt Norway. 
•   Winston Phillips (56) Commercial Director (Energy & Cables).
What we do
•  Lifting equipment – We are the market leader in the 
inspection, maintenance and hire of owned and client 
equipment. In conjunction with suppliers and academic 
institutions we have also developed products for the offshore 
market that have become industry benchmarks. We can 
deploy over 40 experienced engineers offshore or onsite.
•  Powered hand tools – We supply, inspect and maintain  
a wide range of powered hand tools and have developed  
a comprehensive HAV’s capability in-house.
•   Hydraulics – Our experienced engineers can inspect and 
maintain a range of hydraulic equipment at our dedicated 
facility in Aberdeen.
•   Working at height equipment – Having recently acquired the 
Aberdeen servicing unit of Capital Safety we have a dedicated 
workshop in Aberdeen that can inspect, maintain, hire and 
supply Fall Arrest products through all our offshore sites. 
•   L i f e r a f t s – We are approved to inspect and repair the world’s 
leading brands of commercial and leisure liferafts and Marine 
Evacuation Systems (MES).
•  Lifeboats – We have the expertise and ability to service, 
inspect and repair lifeboats, commercial rescue and  
man-overboard boats. We supply new lifeboats and rescue 
boats, davits and our own-brand lifeboat release hooks.
•   Lifejackets – Our flexibility and expertise allows lifejackets  
to be serviced at branch level or onsite at offshore oil and  
gas rigs.
•  C o s a l t Compliance – We have a unique and market-leading 
compliance and technical support division with proven  
ICP expertise and direct involvement with the leading  
industry bodies.
•  Wire and fibre ropes – We have comprehensive rigging 
facilities at all our sites and have an exclusive wire distribution 
agreement with Bridon. We supply technical fibre rope 
solutions to the offshore and SPM markets.
Where we operate
Cosalt Offshore operates out of three sites – Aberdeen, 
Stavanger and Lowestoft, which form an unique pan-North Sea 
network of service and rigging centres.
Aberdeen
Following a major refurbishment to our Denmore Road facilities, 
two traditional Cosalt marine businesses were successfully 
incorporated into the main site during the year. This means  
that as well as liferaft and lifejacket servicing, we can now  
offer a lifeboat sales, refurbishment and inspection service.  
Our ability to leverage these additional products and services 
through our existing contracts has helped us achieve significant 
wins in both lifejacket sales and lifeboat sales and inspections.
As part of a new agreement with Bridon, signed in June 2009, 
their rigging workshop at Inverbervie was amalgamated into  
the existing facilities at Aberdeen. 
Stavanger
The Norwegian market activity decline was earlier and more 
severe than in the UKCS. With this business more susceptible 
to the peaks and troughs of the exploration sector the two main 
focus areas for the team in Norway in 2009 was to increase  
the tooling/lifting equipment hire and management activity  
and to gain additional business in the subsea sector.
Following the contract win for inspection and support for 
Subsea7 vessels in Norway, the Stavanger operation was 
awarded the main lifting equipment hire and management 
contract for Subsea7. This is a tangible example of the 
competitive advantage of our pan-North Sea network as 
Subsea7 are an important client for us in Aberdeen.
This win gives the Norwegian operation repeat business which 
is underpinned by regulation and provides a solid base from 
which to expand this activity to both the subsea sector and  
the main offshore operators and engineering companies.
Lowestoft
Having secured the Perenco contract last year for management/ 
hire of tooling/lifting equipment, the Lowestoft business has 
continued to develop this activity to other offshore clients  
in the Southern sector.
The market
Market activity declined significantly in 2009 as the oil price 
went from $140/barrel to under $40/barrel. This had an 
immediate impact on the upstream exploration sector where 
seismic activity was much reduced earlier on in the year 
followed by a decrease in drilling by the main drilling companies 
and the platform operators.
The market situation in general has put pressure on margins  
as operators look to reduce their cost base. This environment  
is likely to remain well in to 2010 although the recent stability 
 of oil prices at around $75-$80/barrel gives some level  
of optimism that the market will improve in the third and  
fourth quarters.
Having said that, Cosalt Offshore’s revenue stream is more 
resilient than most suppliers, with the majority of our service 
and product offering underpinned by regulation and long-term 
contracts. Despite this we have taken positive action to reduce 
overheads and to leverage our increased volumes to gain better 
buying prices.
4
2
1
3
Cosalt Offshore locations:
1 Aberdeen 
2 Lowestoft
3 Stavanger 
4 Rotterdam  16 Cosalt plc Annual report & financial statements 2009
Cosalt Offshore Business review
Cosalt Offshore
continued
New products and services
2009 saw the successful launch of Funis Veritas – a wire rope 
integrity management system – that complements our new 
partnership with Bridon International which includes the supply 
of specialist wire ropes. The initial response to this unique 
system, which monitors and controls the through-life integrity  
of large wire ropes, has been very positive with orders for both 
the management system and wires already in place.
The lifeboat sales, servicing and refurbishment activity has also 
been well received and is seen by our existing and potential 
clients as a natural extension to our current competencies  
and quality processes. We have won several inspection and 
maintenance contracts and have carried out several surveys  
for clients who are upgrading to the new HSE guidelines on 
lifeboat capacity. A recent such survey for Dolphin Drilling 
resulted in the supply of four new lifeboats for one of their  
rigs with several more rigs to be equipped.
To complement our range of Cosalt branded lifeboats we have 
also developed an approved lifeboat hook, the Cosalt H50, 
which meets the latest IMO guidelines.
A major lifejacket replacement programme allowed us to 
leverage our existing client contracts and relationships to win  
a major share of the market with sales of over 10,000 of the 
market leading SeaCrewsader lifejacket designed specifically 
for the offshore market.
Initiatives during the year
One of the key initiatives of 2009 was the signing of the Bridon 
agreement which gives us exclusive distribution of Bridon wire 
to the UK offshore market. Bridon is the leading global brand  
for specialist wire rope and we see this as a major opportunity 
for both businesses. In 2010 we will also be offering Bridon wire 
in the Norwegian sector through our Stavanger operation.
Following the reforming of our technical department into Cosalt 
Compliance this has brought new focus and initiatives. In 2009 
Cosalt Compliance were successful in obtaining the ISO-14001 
Environmental standard for businesses in our class. Cosalt 
Compliance also initiated the Funis Veritas wire rope integrity 
management programme which will complement our supply  
of Bridon wire to the specialist lifting and subsea market.
Another major contract win in 2009 was the BP three-year 
contract for the supply of lifting and rigging equipment to BP 
and all their subcontractors. This contract will provide additional 
business for both the Aberdeen and Lowestoft operations.
Prospects for the future
In last year’s report we forecast that the low crude oil price 
would lead to a restructuring of the industry in 2009 as our 
clients and the industry in general look at reducing their supplier 
base and enter in to long-term contracts with partners that offer 
a wider geographic footprint and a wide range of 
complimentary services.
In 2009 we have widened our product range and consolidated 
our unique pan-North Sea network. This has already impacted 
on 2009 with contract wins for pan-North Sea companies like 
Subsea7 and for lifeboat sales and services for Dolphin and 
Perenco.
In addition we have extended our contract terms with several  
of our key clients such as CNR and PSN and added new 
products and services to existing contracts.
In summary, we are expecting market conditions in the year 
ahead to be just as tough, but the strategy we set out and 
implemented in 2009 has been successful and will give us 
added competitive advantage to help secure some significant 
contract opportunities, as well as additional revenue from new 
products and services. 
Calum Melville
Chief Executive Offshore Division
Cosalt’s specialists, approved by manufacturers, examine, repair and 
service all industry leading equipment brands. Market 
leadership in 
safety critical 
equipment in 
t h e 	 Nor t h 	 S e a
Cosalt Offshore is the market leader in the 
inspection, maintenance and hire of owned and 
client equipment. We operate out of three sites – 
Aberdeen, Stavanger and Lowestoft – which form  
a pan-North Sea network of service and rigging 
centres. During the year we extended our contract 
terms with several key clients and added new 
products and services to existing contracts. 
17 Cosalt plc Annual report & financial statements 2009 18 Cosalt plc Annual report & financial statements 2009
Cosalt Marine Business review
Cosalt Marine
We supply, inspect, test and maintain a wide range of marine 
safety equipment from liferafts and lifeboats to lifejackets and 
immersion suits. We also supply and service lifting equipment, 
rope, rigging, fire fighting and height safety products. We are  
a leading provider of protective clothing and workwear.
Objectives and strategy
Our objective is to become the leading supplier of our chosen 
products and services within our current operating countries 
and within a number of niche global markets. We will achieve 
this by delivering excellent customer service, comprehensive 
technical support and ongoing product innovation. This will 
drive our business forward and enable us to become the 
industry supplier of choice.
Our strategy for the coming year is to enhance our servicing 
capabilities and to expand the sales of core products into key 
customer and market sectors. To do this we will continue to 
focus on developing new and innovative products by working  
in close partnership with our customers. Our overall strategy is 
one of growing market share through key account management  
and product development.
This year’s performance
Cosalt Marine reported a turnover of £63.6 million (2008:  
£63.2 million) and an operating profit before special items of 
£4.9 million (2008: £2.1 million) during the period. This business 
was generated through the division’s four main business  
units namely UK Marine, Continental Marine, Crewsaver  
and Workwear.
Cosalt Marine’s remit is primarily to focus on areas of regulated 
and legislated safety. As such the division has positioned itself 
in resilient areas of operation such as marine safety servicing, 
fire equipment, rail trackside safety clothing and lifting 
equipment testing.
Andrew Richards
Managing Director Cosalt Marine
Our strategy for the coming  
year is to enhance our servicing 
c a pa b i l i t i e s 	 a n d 	 t o 	 e x pa n d 	 t h e	 
sales of core products into key 
customer and market sectors
Marine operating profit
£4.9m
Marine revenue
£63. 6m 19 Cosalt plc Annual report & financial statements 2009
Business review Cosalt Marine
The past year has seen difficult trading conditions for both our 
marine offshore and industrial based businesses. Customers 
have tightened their spending and in particular cut back on 
capital expenditure projects. This has resulted in sales of  
£63.6 million in 2008/09 compared to £63.2 million in 2007/08. 
While product sales were impacted by market conditions  
we were particularly pleased to see growth in our servicing 
activities which supports our decision to expand our marine 
safety, fire and engineering inspection and maintenance 
capabilities.
Key people
Cosalt Marine employs over 500 people in a European-wide 
business network that spans several countries. Key individuals 
within the business are:
•  Andrew Richards (41) Managing Director Cosalt Marine. 
•  Jim Haughey (43) Finance Director. 
•  Johan Denis (47) General Manager Continent. 
•  Jon Crossland (41) Managing Director Cosalt Workwear. 
•  Nick Dennison (46) Sales Director UK Marine. 
Where we operate
UK Marine
Our UK Marine business operates from ten locations namely 
Glasgow, Edinburgh, North Shields, Grimsby, Southampton, 
Plymouth, Newlyn, Bristol, Milford Haven and Birkenhead. 
These branches service the needs of key customers such as  
P&O Cruises, The RNLI, Condor Ferries, the MOD and BAE. 
Our key activities are marine safety sales and servicing, lifting 
equipment safety testing, fire equipment sales, fibre and wire 
rope supply.
Continental Marine
Our Continental Marine business operates from five countries 
namely Belgium, Germany, Italy, Netherlands and Spain.  
Our key activities cover liferaft, lifeboat and fire equipment 
servicing. Our key customers include MSC, Carnival Cruises, 
Damen Shipyards and the Netherlands MOD. 
Crewsaver
Our Crewsaver business operates from Gosport in the UK. 
Crewsaver sells its own designed products worldwide. The 
Crewsaver brand is well respected and recognised in both  
the leisure and commercial markets. Our key customers include 
the UK MOD, RNLI and the Environment Agency. We also 
export Crewsaver products through an established network  
of distributors. The business manages four brands: Crewsaver, 
Cosalt, Yak and CSR. The primary brand is Crewsaver, which 
embraces lifejackets, marine safety and sailing equipment. 
Workwear
Our Workwear business operates from Stockport and Barnsley 
with a fire brigade service centre located in Maidstone. The 
business is clearly focused as a leading provider of personal 
safety and protection products to the fire, police, MOD, 
hi-visibility and branded market place. 
What we do
•  Liferafts – We are approved to inspect and repair the world’s 
leading brands of commercial and leisure liferafts and Marine 
Evacuation Systems (MES).
•  Lifeboats – We have the expertise and ability to service, 
inspect and repair lifeboats, commercial rescue and  
man-overboard boats.
•  Lifejackets – Our flexibility and expertise allows lifejackets to 
be serviced at branch level or onsite at offshore oil and gas rigs.
•  Fire safety – Our teams of qualified engineers have the ability 
to service equipment onsite or at port of call for vessels.
•  Lifting, tools & inspection – Our comprehensive service 
offering covers on/offshore testing, tool/lifting equipment, 
power tools and height safety equipment.
•  Wire & fibre ropes – Our experienced engineers can assess 
requirements onsite and design, manufacture and install to 
exacting standards. 
•  Safety workwear – Our managed service provides a holistic 
solution to the maintenance, repair and replacement of highly 
complex PPE. 
•  Cosalt Compliance – We offer a highly specialised and unique 
service where Cosalt undertakes responsibility for legislative 
driven matters.
25
23
24
9 10 12 6
2
8
1
13
4
3
5
7
17
19
18
20
22
21
16
15
14
11
Cosalt Marine locations:
1 Birkenhead 
2 Bristol
3 Edinburgh 
4 Grimsby 
5 Glasgow
6 Gosport (Crewsaver) 
7 Lowestoft 
8 Milford Haven
9 Newlyn 
10 Plymouth 
11 North Shields
12 Southampton
13 Stockport (Workwear)
14 Barnsley
15 Aberdeen
16 Maidstone 
17 Antwerp
18 Grou
19 Rotterdam 
20 Hamburg
21 Kiel
22 Rostock
23 Civitavecchia 
24 Livorno 
25 Barcelona  20 Cosalt plc Annual report & financial statements 2009
Cosalt Marine Business review
Cosalt Marine
continued
The market
Trading conditions have been very tough, with many of our 
markets in recession during the majority of the year. This 
manifested itself in reduced shipping numbers of around  
20% in the key ports of Rotterdam, Antwerp and Hamburg.  
As economies recover and trading conditions return to more 
usual patterns we are well placed to maintain and grow our 
market share.
While the retail markets of our Crewsaver business were 
affected by the downturn, the demand for our leisure products 
proved more resilient than expected and we expect this market 
to fully recover in 2010.
The industrial onshore sector, where we supply our UK lifting 
and inspection services, saw a reduction in customer 
expenditure. Capital projects and planned maintenance were 
delayed or plants mothballed. However the annual inspection 
and certification business remained resilient.
Our Workwear division supplies the fire and rescue services, 
police, MOD, hi-visibility and branded workwear markets within 
the UK and Europe. Our key customers include Network Rail, 
Babcock Rail, BMW, Ford, the West Midlands and Scottish 
Police Forces. 
New products
During the year we launched several key new products in the 
marine sector including Crewsaver designed inherent and 
inflatable lifejackets. The recently introduced SeaCrewsader 
lifejacket enjoyed particular success in the North Sea offshore 
market and the new Premier 2010 lifejacket aimed at the cruise 
and ferry market won a Safety at Sea innovation award. The 
product was introduced to the market with advanced orders  
in line with expectations. In the coming year, Crewsaver is 
launching a new range of Crewfit 190N single and twin chamber 
inflatable lifejackets. These products have already been well 
received by both customers and distributors.
Our Workwear business has developed a number of new 
products including hi-visibility clothing for use on the UK rail 
network and police foul weather clothing. Customer feedback 
on wearability and fit comfort helped us develop new fit-for-
purpose fire clothing. We have also produced a number of 
bespoke workwear products for the motor industry. Further 
projects are underway to take advantage of the latest 
technological advancements.
Initiatives during the year
Key account management has been introduced during the  
year to provide a clear focus on where the main opportunities 
lie within the division. Individual accounts have been allocated  
to sales individuals and sales staff incentivised in line with  
their contribution to the business over-achieving its targets.
A clear focus on reducing the managed assets within the 
business saw an improved debtors picture, a reduction in  
stock and an extension of creditors terms where possible.
Overheads and activities of the business were reviewed and 
during the year a number of redundancies took place seeing  
the overall workforce reduce by 12%. We also took steps  
to end several non-contributing business activities and 
consolidate our business sites.
Contract wins
Cosalt Marine secured and extended major contracts within  
all business areas including Netherlands MOD, UK MOD 
lifejackets and buoyancy aids, further cruise vessel lifejacket 
and liferaft hire contracts, a two year extension with Network 
Rail for hi-visibility workwear, a three-year contract with 
Babcock Rail for hi-visibility workwear and a significant UK 
Police public order coverall contract. On top of this we won 
several other new contracts within the marine and industrial 
sectors that have excellent potential for further development.
New opportunities
Our division is currently working on a number of key competitive 
tenders and we are looking to develop our product range 
offering across all business sectors. In particular, we are aiming 
to expand our lifeboat and fire equipment servicing on the 
continent and our existing liferaft hire contracts. We are also 
looking to secure the supply of new safety equipment to the 
cruise and ferry market.
In the industrial sector we are introducing new computer 
systems to tag and record data on customers equipment  
and servicing records. This technology gives us a competitive 
advantage and will see us well placed to secure new tooling 
and lifting equipment contracts.
Our Workwear business enters 2010 tendering for several major 
fire clothing fully managed service contracts. With our new 
product designs and proven service model, we are well placed 
to secure further new business. 
Andrew Richards
Managing Director Cosalt Marine
Cosalt is a leading provider of personal safety and protection products for 
the fire service, police and MOD. 21 Cosalt plc Annual report & financial statements 2009
E x c e p t ion a l	
performance  
in demanding 
environments
Modern lifejacket design reached new heights with the recent 
launch of the all-new Crewfit 190N lifejacket. Designed with 
today’s sailing enthusiast in mind, the product is the result  
of two years exhaustive testing and refining. 
 
Cutting edge design features ensure the Crewfit 190N is 
compact, lightweight and extremely comfortable to wear. The 
product offers exceptional performance in the most demanding 
environments while remaining stylish and hardwearing. It has 
been designed to outperform both the existing legislation and 
the newly introduced standard BSEN ISO 12402. The Crewfit 
190N embodies the spirit of innovation that drives Cosalt 
Marine forward. 
 
Alex Thomson (pictured) is wearing the new Crewfit 190N Lifejacket, 
specifically branded for the Hugo Boss/Alex Thomson Racing crew. 22 Cosalt plc Annual report & financial statements 2009
Board of directors Business review
B o a r d 	 o f 	 d i r e c t o r s
1. David Ross ACA
*†‡
Non-Executive Chairman
David joined the Board on 12 April 2005 and was appointed 
Chairman in October 2009. A Chartered Accountant, he was 
Chief Operating Officer of Carphone Warehouse between  
1990 and July 2003 with responsibility for its activities in 
mainland Europe. In 2006 he was appointed a Trustee of the 
National Portrait Gallery and is the main sponsor for Havelock 
Academy in Grimsby. The Audit Committee Meeting is chaired 
by David Ross.
2. Mark Lejman
Chief Executive
Mark Lejman joined the Board as Chief Executive on  
1 June 2008 and has a wealth of experience gained from an 
international industrial career spanning more than 30 years.  
He was formerly at The Morgan Crucible Co PLC as a Director 
and CEO of its Carbon Division. From 1978 to 1998 he was  
at Courtaulds PLC where he held a number of positions,  
latterly as CEO of its Tencel premium fibres division. In 1998,  
he was part of the team that led the management buy-out  
of Tencel. At Acordis Group, as Tencel became known,  
he was CEO of the group’s Cellulosic Fibres division.  
Mark is also a Non-Executive Director at Delta PLC and 
Berkshire East NHS Trust.
3. Mike Reynolds
Finance Director
Mike joined Cosalt plc on 11 August 2008 as Finance Director. 
Mike was formerly at CAPE Group from 1991 to 2008, latterly  
as Group Finance Director, where he played a key role in their 
acquisition programme.
4. Neil Carrick FCA
Company Secretary
Neil joined Cosalt plc in 1995 as Company Secretary/Finance 
Director Designate and was appointed to the Board as Finance 
Director in 1996 until August 2008. Prior to this between 1989 
and 1995 he was Group Financial Controller and Company 
Secretary of William Cook Plc. Qualified as a Chartered 
Accountant with Price Waterhouse in 1985.
1
2
3
4 23 Cosalt plc Annual report & financial statements 2009
Business review Board of directors
5. Calum Melville
Executive Director
Calum joined Cosalt plc following the acquisition of GTC  
Group Limited – which Calum owned with his brother Stuart. 
Cosalt Offshore was formed with Calum heading the division  
as Chief Executive. 
6. Simon Gilbert
*†‡
Non-Executive Director
Simon is a Managing Partner at Hanover Investors and  
has worked in a number of operational and investing roles. 
Simon is also a Non-Executive Director of Fairpoint Group  
(AIM quoted financial services). Simon holds an MBA and  
a BA (Hons) degree in Economics & Spanish from Bristol 
University. The Remuneration Committee is chaired by  
Simon Gilbert.
7. Yarom Ophir
*†‡
Non-Executive Director
Yarom resides in Geneva where he is the Managing Director  
of Katana SA. He is also a Director of Societe lmmobiliere  
IMS SA and Soverino Real Estate Management SA and on the 
board of International Maritime Services SA. Yarom served  
on the board of Bank of New York-Inter Maritime Bank, Geneva, 
a fully authorised Swiss bank. Yarom’s experience also extends 
to diversified investment management through his directorship 
of Sovereign Holding Limited, the Bermuda-based principal 
holding vehicle of the Rappaport Family Trust. 
8. Maurice White
*†‡
Non-Executive Director
Maurice qualified as a mechanical engineer in the oil and gas 
industry. Following a successful career in operations and 
engineering he was appointed Managing Director of KCA 
Deutag Drilling Ltd in 1996. In 2001 Maurice was appointed  
to the Board of Abbot Group plc, retiring from this executive 
role in 2009. Maurice also served on the Executive Committee 
of the International Association of Drilling Contractors from 
2002 until early 2005. The Nominations Committee Meeting  
is chaired by Maurice White.
*
  Member of Audit Committee
†
  Member of Remuneration Committee
‡
  Member of Nomination Committee
5
6
7
8 Governance
24 Cosalt plc Annual report & financial statements 2009
Directors’ report
Directors’ report
The Directors present their report with the accounts for the  
53 weeks ended 1 November 2009.
Business review
The results for the 53 weeks to 1 November 2009 reflect 
progress in becoming an integrated Safety and Protection 
business. Further details can be found in the Business review  
on pages 10 to 23 and key performance indicators on page 3.
Revenue increased to £107.8 million from £105.0 million and  
operating profit before taxation and special items was  
£8.6 million compared to £9.5 million.
The loss on continuing operations after tax, financing costs  
and special items was £2.6 million. The corresponding figure  
in the previous year including losses relating to the discontinued 
operations of Holiday Homes and Banner amounting to  
£25.5 million was a loss for the period of £24.8 million.
Dividends
Details of the dividends paid in 2008 are set out in note 10  
on page 49.
Fixed assets
In note 14 on page 52, information is provided on assets used  
by the Group which are subject to lease agreements.
Investment properties are stated at fair value after undertaking 
professional valuations.
Share and loan capital
Details of changes in share capital are shown in note 23  
on page 59.
As at 2 February 2010 the Company had 404,403,397 ordinary 
shares of 1p each in issue. Save for the treasury shares and 
some shares held under the Performance Share Plan these 
ordinary shares carry equal rights to dividends, voting and  
return of capital on the winding up of the Company. There are  
no restrictions on the transfer of securities in the Company  
and there are no restrictions on any voting rights other than  
those prescribed by law, nor is the Company aware of any 
arrangement between holders of its shares which may result  
in restrictions of the transfer of securities or voting rights.
Details of outstanding awards under the Cosalt plc Share  
Option Scheme and the Performance Share Plan are set out 
within the Remuneration Report on page 28. The Cosalt 
Employee Share Trust purchases shares to be granted to  
Senior Directors and Senior Executives via our long term 
incentive schemes and subject to the achievement of 
performance targets. At 2 February 2010 the Trust held  
483,346 ordinary shares in the Company. No dividends are 
payable on these shares until they vest.
As at 2 February 2010 a Trust held 28,096 of the 50,250 issued 
unquoted 7.50% preference shares in the Company. The rights 
attached to these shares are as follows: 
(i)  in priority to ordinary shareholders, to a fixed cumulative 
preference dividend at a rate of 7.50% per annum;
(ii)  on a return of capital on a winding up, will carry the right to 
repayment of capital together with a sum equal to any arrears 
of dividend in priority to the rights of ordinary shareholders;
(iii)  to attend and vote at a general meeting of the Company  
only in certain limited circumstances where the special  
rights attaching to these shares might be varied or their 
interest affected.
Articles of Association
The Company’s Articles of Association give powers to the Board 
to appoint Directors. Specific rules regarding the re-election  
of the Directors are set out in the Corporate Governance report 
on pages 29 to 32.
We will be taking the opportunity to propose the adoption of  
new Articles of Association at our 2010 AGM. Please refer to 
the Notice of Meeting for further details.
The Board of Directors may exercise all powers of the Company 
subject to the provisions or relevant statutes and the Company’s 
Memorandum and Articles of Association. These include  
specific provisions and restrictions regarding the Company’s 
power to borrow money. Powers relating to the issuing and 
buying back of shares are included in the Articles of Association 
and such authorities are renewed by shareholders each year  
at the Annual General Meeting.
The Articles of Association may be amended by Special 
Resolution of the shareholders.
As permitted by the Companies Act 2006, the Company has 
indemnified each of the Directors.
Directors
The membership of the Board is shown on page 22 to 23.
Mr D P J Ross retires by rotation and being eligible, offers  
himself for re-election. 
Mr M T Reynolds retires by rotation and being eligible, offers 
himself for re-election.
Mr C Melville having been appointed as a Director since the  
last Annual General Meeting offers himself for re-election. 
Mr S Gilbert having been appointed as a Non-Executive  
Director since the last annual General meeting offers himself  
for re-election.
Mr M A White having been appointed as a Non-Executive  
Director since the last annual General meeting offers himself  
for re-election.
Mr N R Carrick, Mr M Lejman, Mr M T Reynolds and  
Mr C Melville have rolling Service Contracts with Cosalt plc  
which are terminable upon one year’s notice.  Governance
25 Cosalt plc Annual report & financial statements 2009
Directors’ report
Director’s interests shares
 2 Feb 1 Nov 26 Oct
 2010  2009 2008
Ordinary Shares  1p share 1p share 25p share
D P J Ross 60,998,069 60,998,069 3,989,296
M R Peacock  
(resigned 30/04/09) n/a 2,907 ,953 2,907 ,953
R H E Powell  
(resigned 30/04/09) n/a 5,000 5,000
J A B Kelly  
(resigned 06/01/10) n/a 127, 109 1 1,24 1
N R Carrick 16,158 16,158 2,067
D W Hobdey  
(resigned 30/11/09) n/a 97,880 1,521
M Lejman 4,910,291 4,910,291 36,425
M T Reynolds 494,566 494,566 –
Y Ophir – – –
C Melville (appointed 30/11/09) – – –
S Gilbert (appointed 30/11/09) – – –
M A White (appointed 06/01/10) – – –
All shareholdings are beneficial unless otherwise stated.
Details of Directors’ options may also be found in the report  
by the Remuneration Committee on page 28.
Substantial shareholdings
As at 2 February 2010 Lynchwood Nominees held 74,075,418 
shares (18.32%) ordinary shares. The Rappaport family trust 
controls the voting power for these shares. Mr D P J Ross 
(Chairman) holds 60,998,069 ordinary shares (15.08%). Chase 
Nominees 27,918,187 (6.90%), Hanover Investments Ltd hold 
25,184,178 (6.23%). Barclayshare Nominees Ltd hold 16,136,785 
(3.99%) and BNY GIL Client Account holds 14,998,742 (3.71%).
Other shareholdings
Mr N R Carrick is a trustee of a Trust which has powers to 
acquire 7.50% preference shares of the Company. These shares, 
of which there are 50,250 in issue, are unquoted. At 2 February 
2010 the Trust has acquired a total of 28,096 and will continue  
to acquire these shares as and when they are offered.
Community support and charitable donations
Charitable donations made by the Group during the year 
amounted to £20,238.
Employees
Details of the number of employees by business are shown  
in note 8 on page 48.
By various means, efforts are made to encourage employee 
involvement in the Group and to disseminate information to 
increase awareness of its activities and the decisions taken 
which affect employees’ interests.
The Group has for many years employed disabled persons 
whenever appropriate and has made efforts in respect of  
existing employees who have become disabled during their 
service. Full consideration is given to the career development  
of such individuals.
Supplier payment policy
It is the policy of the Company and its UK subsidiaries to 
establish terms of payment with suppliers when agreeing the 
terms of business.
The aim is to despatch cheques to settle undisputed accounts 
on the due date, or where other means of payment are used,  
to deliver funds as if payment had been made by cheque.
The number of days’ purchases outstanding at the end of the 
financial year was 60 days for the Group and 72 days for the 
Company.
Forward-looking statements
This Annual Report may contain forward-looking statements 
based on current expectations of, and assumptions and 
forecast made by, Group management. Various known and 
unknown risks, uncertainties and other factors could lead to 
substantial differences between the actual future results, 
financial situation development or performance of the Group 
and the estimates and historical results given herein. Undue 
reliance should not be placed on forward-looking statements 
which speak only as of the date of this document. The Group 
accepts no obligation to publicly revise or update these 
forward-looking statements or adjust them to future events or 
developments, whether as a result of new information, future 
events or otherwise, except to the extent legally required.
Disclosure of information to Auditors
The Directors who held office at the date of approval of this 
Directors’ report confirm that, so far as they are aware, there is 
no relevant audit information of which the Company’s Auditors 
are unaware; and each Director has taken all the steps that he 
ought to have taken as a Director to make himself aware of any 
relevant audit information and to establish that the Company’s 
Auditors are aware of that information.
Auditors
The Auditors, KPMG Audit Plc, have expressed their willingness 
to continue in office. In accordance with Section 487 of the 
Companies Act 2006, a resolution for their appointment will be 
proposed at the Annual General Meeting.
By order of the Board
N R Carrick
Company Secretary
2 February 2010 Governance
26 Cosalt plc Annual report & financial statements 2009
Remuneration report
Remuneration report to the Members of Cosalt plc
The parts of this report which are subject to audit are indicated 
with an asterisk.
Remuneration Committee
The Remuneration Committee is chaired by Mr Gilbert and 
consists of Messrs. Ophir, White and Ross. Mr White was 
appointed 6 January 2010, Mr Powell resigned 30 April 2009, 
Mr Hobdey resigned 30 November 2009 and Mr Kelly resigned 
6 January 2010. The Committee met twice during the year with 
all Committee Members in attendance. The Committee 
determines the remuneration of Parent Board Directors and 
Senior Executives and makes recommendations to the main 
Board in connection with the various share incentive schemes. 
In framing its remuneration policy, the Committee has given  
full consideration to Section B of the Combined Code and the 
report has been prepared in accordance with the Directors’ 
Remuneration Reporting Regulations 2002. As required by 
these Regulations, a resolution to approve the report will be 
proposed at the Annual General Meeting.
Remuneration policy
Basic policy
The remuneration policy is designed to attract, retain and 
incentivise Senior Executives with the appropriate managerial 
and professional expertise to realise the Group’s business 
objectives.
Remuneration packages consist of fixed elements of basic 
salary, pension entitlements and benefits in kind, typically  
a car or car allowance and private health insurance, plus 
performance related elements such as annual Cash Bonus 
Scheme and participation in the Performance Share Plan.
In setting basic salaries and fees the Remuneration Committee 
has used market data on remuneration levels in companies 
which it considers to be comparable in the broad business 
sectors in which the Group operates and by reference to market 
capitalisation and annual turnover.
The remuneration of the Chairman and Non-Executive Directors 
is determined by the Board. No individual takes part in the 
discussion or decision regarding their own remuneration.
Bonus payments and benefits do not form part of pensionable 
salary. 
Annual performance related bonus scheme
Performance payments are based upon a combination of profit 
and working capital targets linked to base salaries. Targets are 
agreed each year with the Remuneration Committee.
Share Option Schemes
Two Executive Share Option Schemes and Long Term Incentive 
Plans were set up in January 1997. The Committee had made 
regular awards of options to Executive Directors and other 
Senior Executives. The schemes expired in February 2007  
and no further options will be issued under the schemes. 
Performance criteria have been attached to all options granted 
under these schemes. Options will not be exercisable until the 
Company’s earnings per share have grown by 2% per annum 
above the Retail Price Index, over a rolling three-year period.
A deferred bonus plan involving the issue of matching shares  
to Executives was introduced in March 2006, but so far no 
awards have been made under this Scheme.
A Performance Share Plan (“the PSP”) was introduced 
following approval by Shareholders at the AGM in March 2007. 
It provides for awards of either nil (or nominal) cost share 
options or restricted shares. Awards of restricted shares were 
made to two individuals in 2007 but both awards have now 
lapsed. Awards of nil cost options were made during 2008 to 
Directors and Senior Executives. The Remuneration Committee 
set a performance target in respect of these options over  
a fixed three-year period ending in October 2011, that the 
annual adjusted EPS must increase by 5% plus RPI per annum 
for 25% of the award to vest and at 13% plus RPI per annum 
for 100% of the award to vest with a sliding scale operating  
in between these two levels. 
No options were exercised during the year.
No awards have vested during the year.
No awards have been made during the year.
The Cosalt 2009 Company Share Option Plan (“the CSOP”) 
was approved by shareholders at the general meeting on  
1 September 2009, although no awards have yet been made 
under this scheme.
It is anticipated that an award will be made under the CSOP/
PSP in 2010. It will be for Directors and Senior Executives and 
will be based on a range of stretching targets (real earnings  
per share growth between 5% and 15% pa and absolute  
TSR growth at the same level). 
  Governance
27 Cosalt plc Annual report & financial statements 2009
Remuneration report
Directors’ remuneration*
The remuneration of the individual Directors is set out below:
   Performance  Taxable  2009 2008
  Salary  related bonus benefits Fees Total Total 
  £000  £000   £000  £000 £000 £000
N R Carrick  145 30
†
 23 – 198 167
J A B Kelly
1
  – – – 30 30 50
D W Hobdey
2
  – – – 62 62 30
D P J Ross  – – – 36 36 28
M R Peacock
3
  – – – 14 14 28
R H E Powell
3
  – – – 15 15 30
M Lejman  252 – 3 – 255 1 15
Y Ophir  – – – 28 28 1 1
M T Reynolds  236 – 1 – 237 59
C Melville
4
      – 
S Gilbert
4
      – 
M A White
5
      – 
† This amount was provided for in previous years but payment withheld until the current year.
1 Resigned 06 January 2010. 
2 Resigned 30 November 2009.
3 Resigned 30 April 2009. 
4 Appointed 30 November 2009. 
5 Appointed 06 January 2010.
Mr Lejman is the highest paid Director. Total remuneration, including pension contributions of £31,500, amounted to £286,500  
(2008: Per Jonsson £387,000).
£59,583 (2008: £nil) of Mr Hobdey’s remuneration for 2009 relates to his services as Chairman. £8,333 (2008: £12,000) of Mr Ross’ 
remuneration for 2009 relates to his services as Chairman.
Mr Wood retired as a director at the conclusion of the Annual General Meeting in March 2008, after which he became a consultant 
to the Company receiving fees of £40,000 per annum until February 2011.
Pension rights*
Mr Carrick participated in the Group’s Defined Benefits Pension Scheme on the same terms as other Executives
and Staff until its closure to future accrual on 31 December 2006. 
Pension entitlements and corresponding transfer value changes during the year of the Executive Directors who were Members 
of the Defined Benefit Scheme were as follows:
   Accrued  Accrued Increase in Transfer Transfer
   pension  pension accrued value at value at
   at 26 Oct 08 at 1 Nov 09 Pension 1 Nov 09 26 Oct 08
   £pa £pa £pa £ £
N R Carrick*   19,368 20,336 – 340,336 194,256
* The GN11 transfer values for N R Carrick include the value of transferred in benefits from previous schemes. These amounts are not included within the accrued pension.
The change in the transfer value includes the effect of fluctuations in the transfer value due to factors beyond the control of the 
Company and Directors such as stock market movements and gilt yields.
The GN11 transfer values disclosed above do not represent a sum paid or payable to the individual Director. Instead they represent 
a potential liability of the pension scheme. The Trustees are currently reducing any transfer values from the Scheme due to the 
Scheme deficit based upon actuarial calculations.
Mr Carrick received a contribution of 7% of his salary per annum to a personal pension arrangement. 
Messrs. Lejman and Reynolds received 12% of their salary per annum to a personal pension arrangement. Governance
28 Cosalt plc Annual report & financial statements 2009
Remuneration report
Remuneration report to the Members of Cosalt plc 
continued
Performance graph
The following graph shows the Company’s performance, measured by total shareholder return (TSR) compared with the 
performance of the FTSE All Share Index also measured by TSR. TSR is defined as share growth and reinvested dividend. The  
FTSE All Share Index has been selected for comparison as it represents a broad equity index without the inherent volatility of the 
FTSE Fledgling Index. 
Executive Share Option Scheme*
  Number of Options 
  During the Year     Date  
 At     At Exercise from which
Name 01 Nov 08 Granted Exercised Lapsed 1 Nov 09 price exercisable Expiry date
N R Carrick 20,200 – – 20,200 – 289.5p 28/06/05 27/06/09
 20,127 – – – 20,127 346.5p 04/08/06 03/08/10
 73 – – – 73 346.5p 04/08/06 03/08/10
 20,204 – – – 20,204 309p 01/07/07 30/06/11
 26,770 – – – 26,770 269p 01/08/08 31/07/12
Total 87,374 – – 20,200 67,174   
 
* Performance criteria must be met before exercise.
Performance Share Plan*
  Restricted  Nil cost
 Date of shares options  At Market price Date shares
Name  grant granted  granted Lapsed 1 Nov 09 at grant  vest
M Lejman 27.07.2008 – 210,084 – 210,084 238p 31.10.2011
N R Carrick 27.07.2008 – 60,924 – 60,924 238p 31.10.2011
M T Reynolds 13.08.2008 – 91,768 – 91,768 244.5p 31.10.2011
C Melville 27.08.2008 – 26,261 – 25,210 238p 31.10.2011
The market price of the shares at 1 November 2009 was 9.75p and the range during the year was 9.38p to 180.5p. 
The report was approved by the Board of Directors on 2 February 2010 and has been signed on its behalf by:
N R Carrick
Company Secretary
2 February 2010
0 
20 
40 
60 
80 
100 
120 
140 
160 
180 
200 
Nov 2004 May 2005 Nov 2005 May 2006 Nov 2006 May 2007 Nov 2007 May 2008 Nov 2008 May 2009 Sept 2009
Cosalt
FTSE All Share – Price Index
* Governance
29 Cosalt plc Annual report & financial statements 2009
Corporate governance report
Corporate governance report
This report explains the Board’s application of the Principles  
of Good Governance contained in the Combined Code on 
Corporate Governance. 
In this report the Board has adopted the ‘comply or explain’ 
principle, and explains where the Group does not fully comply 
with the recommendations, giving reasons for such non-
compliance.
The Board
The Board consists of four Executive and four Non-Executive 
Directors and the role of Chairman and Chief Executive are 
clearly defined and separate. Mr White is the senior independent 
Non-Executive Director.
In accordance with the Articles of Association one-third of the 
Board is required to retire by rotation each year. In addition any 
Director appointed during the year will stand for re-election  
at the next Annual General Meeting. 
The Board is of the opinion that Mr Gilbert (who is a partner  
in Hanover Investments), Mr Ophir (who is connected to the 
Rappaport family) and Mr Ross, despite being significant 
shareholders or associated with significant shareholders,  
are still able to exercise independent judgement. The Board 
considers that Mr White is fully independent.
The Board is responsible to shareholders for the proper 
management of the Group and for the Group’s system of 
corporate governance. It reviews trading performance forecasts 
and strategy and agrees future plans. The Non-Executive 
Chairman, Mr Ross, is responsible for the running of the Board. 
Executive responsibility for the running of the Company’s 
business rests with four Executive Directors, Mr Lejman,  
Mr Reynolds, Mr Melville and Mr Carrick. The Directors are 
provided with regular information on the Company’s 
performance and activities and meet on a regular basis.  
The Company has a formal schedule of matters specifically 
reserved for the Board’s decision. The Board met 29 times 
during the year and all of the meetings were attended by all 
Directors, with the exception of Mr Powell who did not attend 
four meetings, Messrs. Ross and Kelly who did not attend  
three meetings, Mr Carrick who did not attend two meetings 
and Messrs. Reynolds and Peacock who did not attend one 
meeting. Messrs. Peacock, Powell, Hobdey and Kelly resigned 
from the board on 30 April 2009, 30 April 2009, 30 November 
2009 and 6 January 2010 respectively. Messrs. Melville,  
Gilbert and White joined the Board on 30 November 2009,  
30 November 2009 and 6 January 2010 respectively. The  
Non-Executive Directors periodically visit different parts of the 
Group and meet the local management. 
Through this procedure the Board is able to retain full control  
of the Group, determining strategy and monitoring performance 
of objectives and compliance with policies. Directors have 
access to the advice and services of the Company Secretary 
and may take independent professional advice if necessary,  
at the Company’s expense. Appropriate training is available  
for all Directors as required or as necessary. Executive and  
Non-Executive Directors are formally appointed by the Board  
on the recommendation from the Nominations Committee.  
Non-Executive Directors are appointed for a specific term and 
their re-election is, along with all other Directors, submitted to 
the shareholders in General Meeting on a rotational basis at 
least once every three years and at the first opportunity after 
their initial appointment. Non-Executive Directors do not benefit 
from share options or pension provisions.
Board evaluation
The Board conducted a formal evaluation of its own performance 
and that of its Committees and individual Directors during the 
year. The evaluation consisted of questionnaires. All Directors, 
excluding the Chairman, also evaluated the Chairman’s 
performance.
The results of the evaluations are studied and discussed in 
detail by the Company Secretary, the Chairman and the Board 
as a whole. Any resulting actions are then acted upon during 
the forthcoming year. No serious or significant issues have  
been identified.
Board Committees
The Audit Committee of the Board is chaired by Mr Ross  
and consists of Messrs. Ophir, White and Gilbert. Mr White  
was appointed 6 January 2010 and Mr Gilbert appointed  
30 November 2009. Mr Powell and Mr Peacock resigned  
30 April 2009, Mr Hobdey resigned 30 November 2009 and  
Mr Kelly resigned 6 January 2010.
The Audit Committee has formal terms of reference which are 
available from the Company Secretary upon request. Its main 
responsibilities are to review the integrity of the financial 
statements and announcements relating to the Group’s 
performance and review the scope and findings of the Group’s 
external Auditors and the Group’s accounting controls and 
procedures through regular monitoring and a programme of 
internal audit reviews of controls of operating units. The 
Committee is also responsible for making recommendations to 
the Board in relation to the appointment of the external Auditor. 
During the financial year the Committee has reviewed the 
effectiveness of the external audit process and the audit 
strategy proposed by KPMG Audit Plc. Governance
30 Cosalt plc Annual report & financial statements 2009
Corporate governance report
Corporate governance report  
continued
The Committee has met with the external Auditors to review 
their independence procedures and received a letter from 
KPMG Audit Plc confirming that, in their opinion, they remained 
independent. The Committee has also reviewed the expertise, 
resources and qualifications of the external Auditor and 
approved the proposed audit fee for the 2009 audit. The Group 
also uses KPMG for non audit work, principally tax advice and 
due diligence, but the Committee and Board do not feel this 
undermines the Auditors’ independence at all, and the cost 
benefits in terms of the Auditors’ knowledge of the Group’s 
businesses is significant. This balance remains under ongoing 
review by the Audit Committee. The Committee has 
recommended to the Board that it proposes to Shareholders 
that KPMG Audit Plc continue as the Company’s external 
Auditor and a resolution to that effect is included in the notice of 
meeting for this year’s Annual General Meeting. The Committee 
met prior to the Board Meeting at which the interim financial 
statements and the Annual Report and accounts were approved.
The Committee considered reports from the external Auditor, 
the internal audit function and the status of the Group’s risk 
management and reporting processes, in addition to the 
accounting policies and financial reporting issues and 
judgements.
The Committee is also reviewing arrangements by which staff 
may, in confidence, raise concerns about possible issues  
or improprieties with regard to financial reporting and in this 
regard the Head of Internal Audit function reports directly  
to the Chairman of the Audit Committee.
The Committee met twice during the year and the meetings 
were attended by all of the Members of the Committee with the 
exception Messrs. Ross and Ophir did not attend one of the 
meetings. All Members were provided with reports in advance 
on which they were able to ask questions before the meetings. 
The membership of the Remuneration Committee and its terms 
of reference are set out in the Remuneration report as set out  
on pages 26 to 28.
The Nominations Committee consists of Mr White as Chairman 
and Messrs. Ophir, Gilbert and Ross. Mr White was appointed  
6 January 2010 and Mr Gilbert appointed 30 November 2009. 
Messrs. Powell, Peacock and Kelly resigned 30 April 2009,  
30 April 2009 and 6 January 2010 respectively. The Committee 
met twice during the year and makes recommendations to the 
Board on director’s appointments.
Our Annual General Meeting will be held on 24 March 2010,  
full details of the meeting arrangements and all the proposed 
resolutions can be found in the separate Notice of Meeting.
Internal controls
The Board is responsible for the Group’s system of internal 
control and for reviewing its effectiveness. The system is 
designed to manage rather than eliminate risks and therefore 
can only provide reasonable and not absolute assurance 
against material misstatement or loss.
The Group has formally implemented a process to identify, 
evaluate and manage the Group’s significant risks. The principal 
elements of the internal control system which accord with the 
Turnbull guidance, were in force throughout the period covered 
by the financial statements and to the date of signing the 
accounts are described below.
The Board has put in place a reporting structure where 
operating and financial responsibility is clearly restricted and, 
where appropriate, delegated to the divisional management. 
This allows the Group to obtain maximum benefit from their skill 
in the relevant business sector. Identification and assessment  
of the risks inherent in each operating unit is carried out on  
a regular basis by the management of the individual business 
units and is discussed at monthly management meetings. 
On a quarterly basis they are discussed at Senior Executive 
Meetings involving the CEO and CFO. The Board review  
a Group Risk Report and individual business Risk Reports 
every 6 months. In addition, any significant matters which  
were identified would be brought to the attention of the Board 
at the earliest opportunity.
The Group operates a comprehensive budgeting and financial 
reporting system. Annual budgets are approved by the Board 
and actual results are formally reviewed against budget and the 
prior year every month. Divisional Management report monthly 
to the Board on their performance and any significant variances 
from budget and make revisions to forecasts as appropriate. 
Borrowings are controlled centrally and cash projections are 
prepared and monitored on a daily basis, if required, to ensure 
that the Group has adequate funds and resources for the 
foreseeable future.
Procedures and authorisation levels for all expenditure incurred 
throughout the Group have been clearly defined. All capital 
expenditure is authorised by the Chief Executive Officer and  
the Chief Financial Officer.
There is a rolling programme of internal audit reviews of 
operating units which are documented and any significant 
findings or risks reported to the Audit Committee and 
appropriate action taken. The external Auditors, in carrying  
out their work in order to express an opinion on the financial 
statements, review and test the systems of internal financial 
control and the information contained in the financial 
statements. They report on weaknesses found when meeting 
with the Audit Committee. Governance
31 Cosalt plc Annual report & financial statements 2009
Corporate governance report
Going concern
The Group had in place from March 2009 a fully secured  
£39 million bank facility including a revolving credit line, term 
loans and 364 day facility. Following the placing and open  
offer in September 2009 which raised a net £17 million, these 
facilities were amended. 
The Group now has £33 million of fully secured bank facilities 
consisting of:
•  £19.9 million revolving credit facility with maturity in  
March 2012
•  term facilities of £13.1 million with the repayment of  
£3.5 million in October 2010 and the final repayment in  
March 2012.
At 1 November 2009 the Group was utilising £22 million of this 
facility. Further details of borrowings are included in note 20.
As part of their negotiations a share in the security over the 
assets was given to the Trustees of the Cosalt plc Retirement 
Benefit Plan.
The Group has remained covenant compliant throughout the 
year, including the 1 November 2009 year end.
Having considered these facilities, and reviewed the profit  
and cash forecasts of the Group with appropriate sensitivities 
around operational performance the Directors are satisfied that 
the Group has sufficient funds for the foreseeable future and 
therefore the going concern basis of preparation of the financial 
statements remains appropriate.
Relations with Shareholders
The Company, principally through the Chief Executive Officer 
and Chief Financial Officer, maintains a regular dialogue with  
its major shareholders as well as institutional shareholders  
and financial analysts, particularly following the interim and 
preliminary results announcements. The Chairman makes 
himself available for these regular investor meetings if 
requested to do so. The Non-Executive Directors and the 
remainder of the Board are kept informed of the view of 
shareholders by regular reports from the Chief Executive Officer 
and Chief Financial Officer and independent feedback reports 
from brokers and the Group’s financial PR Company. They also 
receive copies of independent research and brokers notes 
when published. The Company’s Annual General Meeting is 
used as the main opportunity for the Directors to communicate 
with private investors. The Group maintains a website which 
provides additional information for shareholders. At all General 
Meetings the Chairman indicates the level of proxies received 
on all the resolutions following the vote by the meeting. This 
information is also published on our website.
Statement of Compliance with the Combined Code
The Directors believe the Company has complied with the 
provisions set out in Section 1 of the Combined Code.
Statement of Directors’ responsibilities in respect of the 
Annual Report and the financial statements
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. 
Under that law they are required to prepare the Group financial 
statements in accordance with 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).
Under Company law the Directors must not approve the 
financial statements unless they are satisfied that they give  
a true and fair view of the state of affairs of the Group and 
Parent Company and of their profit or loss for that period.  
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 judgments 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 adequate accounting 
records that are sufficient to show and explain the Parent 
Company’s transactions and 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 2006. 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.
Under applicable law and regulations, the Directors are also 
responsible for preparing a Directors’ Report, Directors’ 
Remuneration Report and Corporate Governance Statement 
that complies with that law and those regulations. 
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. Governance
32 Cosalt plc Annual report & financial statements 2009
Corporate governance report
Directors’ responsibility statement pursuant to the 
Disclosure and Transparency Rules 
Each of the Directors, who are named on pages 22 and 23  
in the Board of Directors confirm that, to the best of each 
person’s knowledge and belief:
•  the financial statements, prepared in accordance with the 
applicable set of accounting standards, give a true and fair 
view of the assets, liabilities, financial position and profit or 
loss of the Company and the undertakings included in the 
consolidation taken as a whole; and 
•  the Directors’ report includes a fair review of the development 
and performance of the business and the position of the 
Company and the undertakings included in the consolidation 
taken as a whole, together with a description of the principal 
risks and uncertainties that they face. 
D P J Ross
Chairman
2 February 2010
Corporate governance report  
continued 33 Cosalt plc Annual report & financial statements 2009
Independent Auditors’ report Financial statements
Independent Auditors’ report to the Members of Cosalt plc
We have audited the Group and Parent Company financial 
statements (the ‘financial statements’) of Cosalt plc for  
the 53 week period ended 1 November 2009 set out on  
pages 34 to 79. The financial reporting framework that has been 
applied in the preparation of the Group financial statements is 
applicable law and International Financial Reporting Standards 
(IFRSs) as adopted by the EU. The financial reporting 
framework that has been applied in the preparation of the 
Parent Company financial statements is applicable law and UK 
Accounting Standards (UK Generally Accepted Accounting 
Practice).
 
This report is made solely to the Company’s members, as  
a body, in accordance with Chapter 3 of Part 16 of the 
Companies Act 2006. Our audit work has been undertaken so 
that we might state to the Company’s members those matters 
we are required to state to them in an auditors’ report and for 
no other purpose. To the fullest extent permitted by law, we do 
not accept or assume responsibility to anyone other than the 
Company and the Company’s members, as a body, for our 
audit work, for this report, or for the opinions we have formed.
Respective responsibilities of Directors and Auditors
As explained more fully in the Directors’ Responsibilities 
Statement set out on page 31, the Directors are responsible  
for the preparation of the financial statements and for being 
satisfied that they give a true and fair view. Our responsibility is 
to audit the financial statements in accordance with applicable 
law and International Standards on Auditing (UK and Ireland).
Those standards require us to comply with the Auditing 
Practices Board’s (APB’s) Ethical Standards for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements  
is provided on the APB’s web-site at www.frc.org.uk/apb/
scope/UKP.
Opinion on financial statements
In our opinion:
•  the financial statements give a true and fair view of the state  
of the Group’s and of the Parent Company’s affairs as at  
1 November 2009 and of the Group’s loss for the 53 weeks 
then ended;
•  the Group financial statements have been properly prepared  
in accordance with IFRSs as adopted by the EU;
•  the Parent Company financial statements have been properly 
prepared in accordance with UK Generally Accepted 
Accounting Practice;
•  the financial statements have been prepared in accordance 
with the requirements of the Companies Act 2006; and,  
as regards the Group financial statements, Article 4 of the  
IAS Regulation.
Opinion on other matters prescribed by the Companies 
Act 2006
In our opinion:
•  the part of the Directors’ Remuneration Report to be audited 
has been properly prepared in accordance with the 
Companies Act 2006; 
•  the information given in the Directors’ Report for the financial 
period for which the financial statements are prepared is 
consistent with the financial statements; and
•  the information given in the Corporate Governance Statement 
set out on pages 29 to 32 with respect to internal control and 
risk management systems in relation to financial reporting 
processes and about share capital structures is consistent 
with the financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following:
Under the Companies Act 2006 we are required to report  
to you if, in our opinion:
•  adequate accounting records have not been kept by the 
Parent Company, or returns adequate for our audit have not 
been received from branches not visited by us; or
•  the Parent Company financial statements and the part of the 
Directors’ Remuneration Report to be audited are not in 
agreement with the accounting records and returns; or
•  certain disclosures of Directors’ remuneration specified  
by law are not made; or
•  we have not received all the information and explanations  
we require for our audit.
•  a Corporate Governance Statement has not been prepared  
by the Company.
Under the Listing Rules we are required to review:
•  the Directors’ Statement, set out on page 31, in relation to 
going concern; and
•  the part of the Corporate Governance Statement on  
pages 29 to 32 relating to the Company’s compliance with the 
nine provisions of the June 2008 Combined Code specified 
for our review.
DJ Hutchinson (Senior Statutory Auditor)
for and on behalf of KPMG Audit Plc, Statutory Auditor
Chartered Accountants
1 The Embankment
Neville Street
Leeds 
LS1 4DW
2 February 2010 Financial statements
34 Cosalt plc Annual report & financial statements 2009
Consolidated income statement
Consolidated income statement
for the 53 weeks ended 1 November 2009
  Before  After Before  After
  special items Special items* special items special items Special items* special items
  53 weeks ended  53 weeks ended 53 weeks ended 52 weeks ended 52 weeks ended 52 weeks ended
  1 Nov 2009 1 Nov 2009 1 Nov 2009 26 Oct 2008 26 Oct 2008 26 Oct 2008
  £000 £000 £000 £000 £000 £000
Revenue 2 107,827 –  107,827 105,007 – 105,007
Operating profit 3 8,568 (7,086) 1,482 9,498 (5,025) 4,473
Financial income 7 18 – 18 89 – 89
Financing costs 6 (3,092) (1,758) (4,850) (2,354) (718) (3,072)
(Loss)/profit before taxation  5,494 (8,844) (3,350) 7,233 (5,743) 1,490
Income tax credit (expense) 9 (1,785) 2,548 763 (1,347) 476 (871)
Loss/(profit) from  
continuing operations  3,709 (6,296) (2,587) 5,886 (5,267) 619
Post-tax loss of  
discontinued operations 5 – – – (25,461) – (25,461)
(Loss)/profit for the financial period 24 3,709 (6,296) (2,587) (19,575) (5,267) (24,842)
 
Earnings per share – total operations 11      
Basic  4.20p – (2.93p) (25.62)p – (32.52)p
Diluted  4.17p – (2.93p) (25.62)p – (32.52)p
 
Earnings per share – continuing operations      
Basic  4.20p – (2.93p) 7 .71p – 0.81p
Diluted  4.17p – (2.93p) 7.70p – 0.81p
*  Special items relate to gains and losses on disposal of surplus properties and revaluation of investment properties, amortisation of acquisition intangibles, and exceptional  
costs relating to reorganisation, redundancy, re-banking, abortive acquisitions and share-based payment and LTIP costs. Financial statements
35 Cosalt plc Annual report & financial statements 2009
Consolidated balance sheet 
Consolidated balance sheet 
as at 1 November 2009
      As at As at
      1 Nov 09 26 Oct 08
     Notes £000 £000
ASSETS    
Non-current assets    
Intangible assets – goodwill     13 34,581 33,059
Intangible assets – customer contracts and relationships    13 16,226 18,429
Intangible assets – computer software     13 1,100 894
Investment properties     14 3,540 3,100
Property plant and equipment     14 9,402 9,580
Investments     15 350 2,728
Deferred tax assets     19 4,477 2,588
      69,676 70,378
Current assets    
Inventories     16 18,887 19,384
Trade and other receivables     17 22,300 27,400
Corporation tax recoverable      1,976 –
Derivative financial assets     18 35 622
Cash and cash equivalents      1,493 2,1 71
      44,691 49,577
Total assets      114,367 1 19,955
LIABILITIES    
Non-current liabilities    
Interest bearing loans and borrowings     20 16,253 27,616
Deferred tax liabilities     19 4,559 5,166
Deferred Government grants      6 7
Provisions     22 – 73
Retirement benefit obligations     27 11,759 6,280
      32,577 39,142
Current liabilities    
Interest bearing loans and borrowings     20 3,869 1,373
Corporation tax payable      1,601 1,363
Provisions     22 177 42
Trade and other payables     21 25,721 40,099
Derivative financial liabilities     18 1,018 381
      32,386 43,258
Total liabilities      64,963 82,400
Net assets      49,404 37,555
EQUITY    
Share capital     23 10,336 6,587
Share premium account     24 48,115 34,558
Merger reserve     24 7,586 7,586
Other reserves     24 1,148 1,148
Translation reserve     24 2,669 857
Hedging reserve     24 (983) 241
Retained losses     24 (19,467) (13,422)
Total equity attributable to equity holders of the parent    49,404 37,555
    
The accounts were approved by the Board of Directors on 2 February 2010 and signed on its behalf by:
M Lejman M T Reynolds
Director  Director
The notes on pages 38 to 68 form part of these Consolidated financial statements. Financial statements
36 Cosalt plc Annual report & financial statements 2009
Consolidated statement of recognised income and expense  
Consolidated statement of recognised income and expense  
for the 53 weeks ended 1 November 2009
      53 weeks 52 weeks
      ended ended
      1 Nov 09 26 Oct 08
     Notes £000 £000
Effective portion of changes in fair value of cash flow hedges net of recycling   (1,224) 337
Currency translation differences      1,812 601
Actuarial (losses)/gains on defined benefit scheme    27  (5,941) 1,420
Taxation on items taken directly to equity      1,518 (167)
Property revaluation      614 –
Net (expense) income recognised directly in equity      (3,221) 2,191
Loss for the financial period       (2,587) (24,842)
Total recognised income and expense attributable to the equity shareholders of the parent  (5,808) (22,651) Financial statements
37 Cosalt plc Annual report & financial statements 2009
Consolidated cash flow statement 
Consolidated cash flow statement 
for the 53 weeks ended 1 November 2009
      53 weeks 52 weeks
      ended ended
      1 Nov 09 26 Oct 08
     Notes £000 £000
Cash flows from operations   
(Loss) for the period      (2,587) (24,842)
Adjustments for:   
Income tax expense      (763) (945)
Depreciation     14 2,213 4,931
Amortisation of intangible assets     13 3,768 2,691
Deferred government grants released      (1) (14)
Net finance costs       4,832 2,983
Share-based payment charge/(credit)     24 56 (28)
Investment property losses      335 800
Pension contributions in excess of charge      (1,200) (680)
Loss on disposal of property, plant and equipment     49 2,579
Loss on disposal of subsidiary undertakings     – 9,161
Cash flow before changes in working capital and provisions    6,702 (3,364)
Decrease/(increase) in inventories      497 (3,330)
Decrease in trade and other receivables      5,100 1,696
(Decrease)/increase in trade and other payables     (14,378) 6,687
Increase in provisions      62 2,735
Net cash from operations      (2,017) 4,424
Interest received      179 161
Interest paid      (4,335) (2,748)
Interest element of finance lease rentals      (55) (31)
Dividends paid on preference shares      (4) (4)
Income tax      (2038) (1,261)
Net cash from operating activities      (8,270) 541
   
Cash flows from investing activities   
Acquisition of subsidiaries net of cash acquired     – (11, 198)
Proceeds from sale of subsidiary undertakings     1,896 2,000
Sale of investments      150 250
Proceeds from sale of property, plant and equipment     1,104 48
Purchase of property, plant and equipment     (2,488) (4,100)
Purchase of intangible assets – software      (665) (416)
Net cash outflow in investing activities      (3) (13,416)
   
Cash flows from financing activities   
Dividends paid to Shareholders      – (2,462)
Finance lease principal payments      (447) (534)
Exercise of share options and share placings     17,330 2,901
New loan      36,920 27, 1 71
Repayment of bank borrowings      (46,366) (980)
Net cash from financing activities      7,437 26,096
   
Net (decrease)/increase in cash and cash equivalents    (836) 13,221
   
Cash and cash equivalents at beginning of period     2,171 (11, 1 79)
Effects of exchange rate fluctuations on cash held     158 129
Cash and cash equivalents at end of period     1,493 2,1 71
   
Cash      1,493 2,1 71
Overdrafts      – –
Cash and cash equivalents      1,493 2,1 71 Financial statements Notes to the financial statements
38 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
1. Significant accounting policies
Cosalt plc (the ‘Company’) is a company domiciled in England. The Consolidated financial statements of the Company for the year 
ended 1 November 2009 comprise the Company and its subsidiaries (together referred to as the ‘Group’). The Parent Company 
financial statements present information about the Company as a separate entity and not about its Group.
The financial statements were authorised for issue by the Directors on 2 February 2010.
Statement of compliance
The Consolidated financial statements have been prepared and approved in accordance with International Financial Reporting 
Standards as adopted by the EU (‘Adopted IFRSs’). The Company has elected to continue to prepare its Parent Company financial 
statements in accordance with UK GAAP , these are presented on pages 67 to 77.
a Basis of preparation
The financial statements are presented in pounds sterling, rounded to the nearest thousand. They are prepared on the historical 
cost basis except that the following assets and liabilities are stated at their fair value: derivative financial instruments and 
investment properties.
The preparation of financial statements in conformity with Adopted IFRSs requires Management to make judgements, estimates 
and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses.  
The estimates and associated assumptions are based on historical experience and various other factors that are believed  
to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values  
of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
The 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 if the revision affects only that period or if in the period of the revision and future 
periods if the revision affects both current and future periods.
Going concern
The Group had in place from March 2009 a fully secured £39 million bank facility including a revolving credit line, term loans and 
364 day facility. Following the placing and open offer in September 2009 which raised a net £17.3 million, these facilities were 
amended. The Group now has £33 million of fully secured bank facilities consisting of:
• £19.9 million revolving credit facility with maturity in March 2012.
• term facilities of £13.1 million with the repayment of £3.5 million in October 2010 and the final repayment in March 2012.
A 1 November 2009 the Group was utilising £22 million of this facility. Further details of borrowings are included in note 20.
As part of their negotiations a share in the security over the assets was given to the Trustees of the Cosalt plc Retirement  
Benefit Plan.
The Group has remained covenant compliant throughout the year, including the 1 November 2009 year end.
Having considered these facilities, and reviewed the profit and cash forecasts of the Group with appropriate sensitivities around 
operational performance the Directors are satisfied that the Group has sufficient funds for the foreseeable future and therefore  
the going concern basis of preparation of the financial statements remains appropriate.
 
b Basis of consolidation
The Consolidated financial statements incorporate the financial statements of the Company and entities controlled by the 
Company (its subsidiaries). 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 are 
currently 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.
All intra-group transactions, balances, income and expenses are eliminated on consolidation. Financial statements Notes to the financial statements
39 Cosalt plc Annual report & financial statements 2009
c Business combinations
The acquisition of subsidiaries is accounted for using the purchase method. The cost of the acquisition is measured at the 
aggregate of the fair values, at the date control passes of equity instruments issued, of assets given, less liabilities incurred  
or assumed, plus any costs directly attributable to the business combination. The acquiree’s identifiable assets, liabilities and 
contingent liabilities that meet the conditions for recognition under IFRS 3 Business Combinations are recognised at their fair 
values at the acquisition date.
d Goodwill
Goodwill arising on consolidation represents the excess of the cost of acquisition over the Group’s interest in the net fair value  
of the identifiable assets, liabilities and contingent liabilities acquired. Goodwill is initially recognised as an asset at cost and  
is subsequently measured at cost less any accumulated impairment losses, measured annually (see page 51).
On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.
e Other intangible assets
(a) Computer software costs
Acquired computer software licences and software development costs, are capitalised and amortised over the shorter of their 
estimated useful lives and the contracted term.
(b) Other intangible assets (arising on business combinations)
Trade names:
Trade names are measured as the present value of any royalty payments saved as a result of ownership of the trade name.  
Trade names are amortised over the estimated useful life of the asset, typically 10-20 years.
Customer and supplier contracts and relationships:
Customer and supplier relationships are measured as the present value of cash flows attributable to the relationship after 
deduction of appropriate contributory assets charges. The relationship is amortised over its expected useful life, typically  
6-12 years on either a straight line basis or reducing balance as appropriate.
f Foreign currencies
Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the 
dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated  
to the functional currency at the exchange rate at that date. The foreign currency gain or loss on monetary items is the difference 
between amortised cost in the functional currency at the beginning of the period, adjusted for effective interest and payments 
during the period, and the amortised cost in foreign currency translated at the exchange rate at the end of the period.  
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the 
functional currency at the exchange rate at the date that the fair value was determined. Foreign currency differences arising  
on retranslation are recognised in profit or loss, except for differences arising on the retranslation of available-for-sale equity 
instruments, a financial liability designated as a hedge of the net investment in a foreign operation, or qualifying cash flow hedges, 
which are recognised directly in equity.
g Foreign operations
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated 
to euro at exchange rates at the reporting date.
Foreign currency differences are recognised directly in equity. Since 1 November 2004, the Group’s date of transition to IFRSs, 
such differences have been recognised in the translation reserve (TR). When a foreign operation is disposed of, in part or in full,  
the relevant amount in the TR is transferred to profit or loss.
Foreign exchange gains and losses arising from a monetary item receivable from or payable to a foreign operation, the settlement 
of which is neither planned nor likely in the foreseeable future, are considered to form part of a net investment in a foreign operation 
and are recognised directly in equity in the TR.
  Financial statements Notes to the financial statements
40 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
h Hedge of net investment in foreign operation
Foreign currency differences arising on the retranslation of a financial liability designated as a hedge of a net investment in  
a foreign operation are recognised directly in equity, in the translation reserve, to the extent that the hedge is effective. To the 
extent that the hedge is ineffective, such differences are recognised in profit or loss. When the hedged part of a net investment  
is disposed of, the associated cumulative amount in equity is transferred to profit or loss as an adjustment to the profit or loss  
on disposal.
i Operating profit and special items
In order for users of the accounts to better understand the underlying performance of the Group, the Board have separately 
disclosed transactions which, whilst falling within the ordinary activities of the Group, are, by virtue of their size or incidence, 
considered to be one-off in nature. 
Such items include gains and losses and costs on revaluation of investment properties and sale of assets, amortisation  
of intangible assets and exceptional costs relating to restructuring, refinancing and abortive acquisition costs. In addition they 
include the amortisation of intangible assets and the cost of share-based payments/LTIP’s.
j Employee benefits
The Group operates several occupational pension schemes, of both the defined benefit and defined contribution type.
(a) Defined contribution pension schemes
Contributions to the Group’s defined contribution schemes are recognised as an Employee benefit expense when they fall due.
Prepaid contributions are recognised as an asset to the extent that they result in either a cash refund or reduction in future payments.
Outstanding contributions are recognised as a liability within accruals.
(b) Defined benefit pension scheme
The liability recognised in the balance sheet for the Group’s defined benefit pension scheme is the present value of the defined 
benefit obligation at the balance sheet date, less the fair value of the scheme assets. The defined benefit obligation is calculated  
by independent actuaries using the projected unit credit method and by discounting the estimated future cash flows using interest 
rates on high quality corporate bonds that have terms to maturity approximating the terms of the related pension liability.  
Any asset resulting from this calculation is limited to the present value of available refunds and reductions in future contributions  
to the scheme. Pension expense for the Group’s defined benefit schemes is recognised as follows:
1. Within operating profit:
•  Current service cost – representing the increase in the present value of the defined benefit obligation resulting from Employee 
service in the current period; 
•  Past service cost – representing the increase in the present value of the defined benefit obligation resulting from Employee 
service in prior periods, which arises from changes made to the benefits under the scheme in the current period. To the extent 
that the changes to benefits vest immediately, past service costs are recognised immediately, otherwise they are recognised  
on a straight line basis over the vesting period;
•  Gains and losses arising on settlements and curtailments – where the item that gave rise to the settlement or curtailment  
is recognised within operating profit. 
2. Within financing costs:
•  Interest cost on the liabilities of the scheme – calculated by reference to the scheme liabilities and discount rate at the beginning 
of the period and allowing for changes in liabilities during the period; and
•  Expected return on the assets of the scheme – calculated by reference to the scheme assets and long term expected rate  
of return at the beginning of the period and allowing for changes in assets during the period. 
3. Within the statement of recognised income and expense:
• Actuarial gains and losses arising on the assets and liabilities of the scheme.
The Group previously adopted the amendment to IAS 19 and full actuarial gains or losses are recognised direct to equity.
 
(c) Share-based payments
Equity settled share-based payments are measured at fair value (excluding the effect of non market based vesting conditions)  
at the date of grant. The fair value determined at the grant date of the equity settled share-based payments is expensed  
on a straight-line basis over the vesting period, based on the Group’s estimate of the shares that will eventually vest, with  
a corresponding increase in equity.
For share options where there are no market based vesting conditions, fair value is measured using the Black-Scholes pricing model. Financial statements Notes to the financial statements
41 Cosalt plc Annual report & financial statements 2009
k Taxation
The current tax is based on taxable profit for the period and any adjustments to tax in respect of previous periods. Taxable profit 
differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable  
or deductible in other years and it further excludes items that are never taxable or deductible. The Group’s liability for current tax  
is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.
Deferred tax is recognised on differences between the carrying amounts of assets and liabilities in the financial statements and the 
corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method. 
Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the 
extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such 
assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than  
in a business combination) of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries, except where the 
Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse  
in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer 
probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred  
tax is charged or credited to the income statement, except when it relates to items charged or credited directly to equity, in which 
case the deferred tax is also dealt with in equity.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current  
tax liabilities or when they relate to income taxes levied by the same taxation authority and the Group intends to settle its current 
tax assets and liabilities on a net basis.
l Property, plant and equipment
Freehold land and buildings are carried at cost less accumulated depreciation and impairment losses.
Other assets are carried at cost less accumulated depreciation and accumulated impairment losses.
Subsequent costs are capitalised only when it is probable that they will result in future economic benefits flowing to the Group  
and when they can be measured reliably. All other repairs and maintenance expenditure is charged to the income statement in the 
period in which it is incurred.
Freehold land is not depreciated as it has an indefinite life.
Depreciation on other assets is calculated using the straight-line method to write off their cost less their residual value over their 
estimated useful lives as follows:
Freehold property   2%
Buildings on land leased 
short-term tenancy agreements 2%
Leasehold land and buildings over the expected term of the lease
Plant and machinery 
(excluding leased garments) 5-20%
Vehicles    20-25%
Leased garments   20-50%
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where 
shorter, over the term of the relevant lease.
Residual values and estimated useful lives are reviewed, and adjusted if appropriate, at least at each financial year-end.
 
An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than  
its estimated recoverable amount.
Gains and losses arising on disposals are determined by comparing net sales proceeds with carrying amount and are recognised 
in the income statement in the period of the disposal. Financial statements Notes to the financial statements
42 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
m Investment properties
Investment properties are held to yield rentals and are carried at fair value.
An external, independent valuer, having an appropriate recognised professional qualification and recent experience in the location 
and category of property being valued, values the portfolio every year.
Any gain or loss arising from a change in fair value is recognised in profit or loss.
n Impairment of tangible and intangible assets
(a) Goodwill
For the purpose of impairment testing, goodwill is allocated to the cash-generating units expected to benefit from the combination. 
Cash-generating units to which goodwill has been allocated are tested for impairment annually, or more frequently, when there  
is an indication that the unit may be impaired.
If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated 
first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the 
basis of the carrying amount of each asset in the unit. The recoverable amount is the higher of the cash-generating units fair value, 
less costs of sale and value in use. The value in use is determined from the discounted present values of future cash flows arising 
from the cash generating unit.
An impairment loss recognised for goodwill is not reversed in a subsequent period.
(b) Other tangible and intangible assets
At each balance sheet date, the Group reviews the carrying amount of its tangible and intangible assets to determine whether  
there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount  
of the asset is estimated in order to determine the extent, if any, of the impairment loss. Where it is not possible to estimate the 
recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the 
asset belongs. The recoverable amount is the higher of the cash-generating units fair value, less costs of sale and value in use.  
The value in use is determined from the discounted present values of future cash flows arising from the asset of the cash 
generating unit.
Reversal of an impairment loss for tangible and intangible assets other than goodwill is recognised immediately in the income 
statement to the extent that the original impairment loss was recognised in the income statement.
(c) Financial assets
A financial asset is assessed at each reporting date to determine whether there is any objective evidence that it is impaired.  
A financial asset is considered to be impaired if objective evidence indicated that one or more events have had a negative effect  
on the estimated future cash flows of that asset.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying 
amount, and the present value of the estimated future cash flows discounted at the original effective interest rate. An impairment 
loss in respect of an available-for-sale financial asset is calculated by reference to its fair value.
Individual significant financial assets are tested for impairment on an individual basis. The remaining financial assets are assessed 
collectively in groups that share similar credit risk characteristics.
All impairment losses are recognised in profit or loss. Any cumulative loss in respect of an available-for-sale financial asset 
recognised previously in equity is transferred to profit or loss.
An impairment loss is reversed if the reversal can be related objectively to an event occurring after the impairment loss was 
recognised. For financial assets measured at amortised cost and available-for-sale financial assets that are debt securities, the 
reversal is recognised in profit or loss. For available-for-sale financial assets that are equity securities, the reversal is recognised 
directly in equity.
o Leases
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership 
to the lessee. All other leases are classified as operating leases.
(a) Finance leases
Assets held under finance leases are recognised as assets of the Group at their fair value at the inception of the lease or, if lower,  
at the present value of the minimum lease payments. The corresponding liability to the lessor is included in the balance sheet  
as a finance lease obligation. Lease payments are apportioned between finance charges and reduction of the lease obligation  
so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged to the income 
statement.
  Financial statements Notes to the financial statements
43 Cosalt plc Annual report & financial statements 2009
(b) Operating leases
Rentals payable under operating leases are charged to the income statement on a straight-line basis over the term of the relevant 
lease. Benefits received and receivable as an incentive to enter into an operating lease are also spread on a straight-line basis over 
the lease term.
(c) Rental garments
Garments hired out under rental contracts where the Group retains substantially all of the risks and rewards of ownership  
are capitalised and accounted for as operating leases. The garments are depreciated on a straight-line basis over their estimated 
useful lives (typically two to five years). Revenue from these rental contracts accrues on a straight-line basis over the life  
of the contract.
p Financial instruments
(a) Trade receivables
Trade receivables are initially measured at fair value, do not carry any interest, and are reduced by appropriate provisions for 
estimated irrecoverable amounts. Such provisions are recognised in the income statement.
(b) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits, and other short-term highly liquid investments with 
original maturities of three months or less that are readily convertible to a known amount of cash and are subject to an insignificant 
risk of changes in value.
(c) Trade payables
Trade payables are not interest bearing and are initially measured at their fair value, thereafter amortised cost.
(d) Borrowings
Bank overdrafts, short-term fixtures and interest bearing loans are initially measured at fair value, and obligations under  
finance leases are dealt with in accordance with the Group’s policy on leases (note o). These items are subsequently carried  
at a amortised cost.
(e) Equity instruments
Equity instruments issued are recorded at the proceeds received, net of direct issue costs.
(f) Financial liabilities and equity
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into.
Financial instruments issued by the Group are treated as equity (ie forming part of Shareholders’ funds) only to the extent that  
they meet the following conditions:
•  they include no contractual obligation to deliver cash or other financial assets or to exchange financial assets or financial liabilities 
under conditions that are potentially unfavourable to the Group; and 
•  where the instrument will or may be settled in the Company’s own equity instruments, it is either a non-derivative that includes  
no obligation to deliver a variable number of the Company’s own equity instruments or is a derivative that will be settled by the 
Company exchanging a fixed amount of cash or other financial instrument for a fixed number of its own equity instruments. 
Dividends on non-equity shares are recognised as a liability and expensed on an accrual basis. Equity dividends are recognised  
as a liability in the period in which they are paid or approved by Shareholders, and recorded directly in equity.
(g) Derivative financial instruments
Derivative financial instruments are recognised at fair value. 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.
Forward exchange contracts are valued at their quoted market price at the balance sheet date.
Where a derivative financial instrument is designated as a hedge of the variability of cash flows of a recognised asset or liability  
or highly probable forecast transactions, the effective part of any gain or loss on the derivative financial instrument is recognised 
directly in the hedging reserve. Any ineffective portion of the hedge is recognised immediately in the income statement.
If the hedging instrument no longer meets the criteria for hedge accounting, expires or is sold, terminated or exercised, then hedge 
accounting is discontinued prospectively. Any cumulative gain or loss on the hedging instrument in equity remains there until the 
forecast transaction occurs.
  Financial statements Notes to the financial statements
44 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
q Provisions
Provisions are recognised when the Group has a present obligation as a result of a past event, and it is probable that the Group  
will be required to settle that obligation. Provisions are measured at the Directors’ best estimate of the expenditure required  
to settle the obligation at the balance sheet date, and are discounted to present value where the effect is material.
r Discontinued operations
Discontinued operations are separate major lines of business that have been disposed of or classified as held for sale.
s Inventories
Inventories are stated at the lower of cost including an appropriate proportion of production overheads and net realisable values.
t Long-term contracts
The amount of profit attributable to the stage of completion of a long-term contract is recognised when the outcome of the 
contract can be foreseen with reasonable certainty. Turnover for such contracts is stated appropriate to the stage of completion 
plus attributable profits, less amounts recognised in previous years. Provision is made for any losses as soon as they are foreseen.
Contract work in progress is stated at costs incurred, less those transferred to the profit and loss account, after deducting 
foreseeable losses and payments on account not matched with turnover.
Amounts recoverable on contracts are included in debtors and represent turnover recognised in excess of payments on account.
u Government grants
Capital grants received for additions to buildings and plant are taken to deferred income and are released to the income statement 
in instalments relating to the relevant asset lives.
Other grants are recognised in the profit and loss account in the same period as the related expenditure.
v Revenue recognition
Revenue from the sale of goods is recognised in the income statement when the significant risks and rewards of ownership have 
been transferred to the buyer.
Revenue from services rendered is recognised in the income statement in proportion to the stage of completion of the transaction 
at the balance sheet date. The stage of completion is assessed by reference to review of work completed.
No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due, associated costs for  
the possible return of goods, or if there is continuing managerial involvement with goods.
The Directors have considered new standards and interpretations issued by the IASB and IFRIC, with effective dates after the  
date of these financial statements. The Directors do not anticipate that adoption of these standards will have a material impact  
on the Group.
•  IFRIC 14 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction clarifies when refunds  
or reductions in future contributions in relation to defined benefit assets should be regarded as available and provides guidance 
on the impact of minimum funding requirements (MFR) on such assets. It also addresses when a MFR might give rise to  
a liability. IFRIC will become mandatory for the Group’s 2010 financial statements with retrospective application required.  
The Group does not expect this to impact on the financial statements. 
• Revised IAS 23 ‘Borrowing Costs’ (mandatory for the year commencing on or after 1 January 2009). 
• Revised IAS 1 ‘Presentation of Financial Statements’ (mandatory for the year commencing on or after 1 January 2009). 
• Revised IAS 27 ‘Consolidated and Separate Financial Statements’ (mandatory for the year commencing on or after 1 July 2009). 
•  Amendments to IFRS 2 ‘Share-based payment – Vesting Conditions and Cancellations’ (mandatory for the year commencing  
on or after 1 January 2009). 
• IFRS 3 revised ‘Business combinations’ (mandatory for one year commencing on or after 1 July 2009).
•  Amendment to IFRS 7 ‘Improving disclosures about financial instruments’ (mandatory for the year commencing on or after  
1 January 2009).
• IFRS 8 Operating Segments (Applicable for periods beginning on or after 1 January 2009).  Financial statements Notes to the financial statements
45 Cosalt plc Annual report & financial statements 2009
2. Segment reporting
(a) Primary
The Group is organised into two main business segments: Marine and Offshore.
The primary segment reporting format is determined to be Business as the Group’s risks and returns are predominantly affected  
by differences in the products and services provided by these different activities. The operating business segments are organised 
and managed separately.
     53 weeks ended 1 Nov 09
     Continuing operations
      Head Office/  
    Marine Offshore unallocated Total 
    £000 £000 £000 £000
Revenue    63,603 44,224 – 107,827
Operating profit/(loss) before special items    4,860 5,317 (1,609) 8,568
Special items    (1,682) (963) (4,441) (7,086)
Operating profit/(loss)    3,178 4,354 (6,050) 1,482
Total assets    45,830 62,850 5,687 114,367
Total liabilities    (13,515) (14,750) (36,698) (64,963)
Total net assets    32,315 48,100 (31,011) 49,404
Capital expenditure    2,179 760 56 2,995
Depreciation    1,447 750 66 2,263
Amortisation of intangible assets    1,680 2,082 6 3,768
       
      52 weeks ended 26 Oct 08
   Continuing operations  Discontinued operations
   Head Office/   Holiday  
 Marine Offshore unallocated Total Schoolwear Homes Total 
 £000 £000 £000 £000 £000 £000 £000
Revenue 63,161 41,846 – 105,007 5,958 37,148 148,113
Operating profit/(loss) 
before special items 2,095 8,336 (933) 9,498 (2,552) (14,940) (7,994)
Special items (455) (150) (4,420) (5,025) – – (5,025)
Operating profit/(loss) 1,640 8,186 (5,353) 4,473 (2,552) (14,940) (13,019)
Total assets 36,230 29,526 52,490 118,246 – – 118,246
Total liabilities (22,999) (11,608) (46,131) (80,738) – – (80,738)
Total net assets 13,231 17,918 6,359 37,508 – – 37,508
Capital expenditure 1,532 1,560 188 3,280 12 808 4,100
Depreciation 1,762 927 117 2,806 102 2,023 4,931
Amortisation of intangible assets 1,388 1,206 7 2,601 26 64 2,691
Operating profits are shown before Head Office charges.      
* Unallocated assets and liabilities principally represent investment properties, taxation, dividends, and pension scheme liability.    
(b) Secondary        
Geographical segments:        
Segment information for the years ended 1 November 2009 and 26 October 2008 is as follows:    
   Revenue  Assets  Capital
  2009  2008 2009  2008 2009  2008
  £000 £000 £000 £000 £000 £000
UK continuing  69,208 70,222 78,415 103,048 1,581 2,469
UK discontinuing  – 42,309 – – – 820
UK total  69,208 1 12,531 78,415 103,048 1,581 3,289
Rest of Europe continuing  38,619 34,785 35,952 15,198 1,414 81 1
Rest of Europe discontinuing  – 797 – – – –
Rest of Europe total  38,619 35,582 35,952 15,198 1,414 811
Total  107,827 148, 1 13 114,367 118,246 2,995 4,100
Revenue is based on the region in which the customer is located. Total assets and capital expenditure are based on the region  
in which the assets are located.
  Financial statements Notes to the financial statements
46 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
3. Operating profit
Operating profit has been arrived at after charging/(crediting):
      2009 2008
      Group Group
      total total
      £000 £000
Change in stocks of finished goods and work in progress      (1,811) 973
Other operating income      (317) (151)
Government grants      – (14)
Raw materials and consumables      58,956 50,085
Other external charges      8,775 15,287
Operating lease charges  
– plant      2,132 831
– other      877 807
Staff costs (note 8)      27,720 24,367
Amortisation of intangible fixed assets (note 13)     714 518
Depreciation of owned assets      1,933 2,585
Depreciation of assets held under finance leases     280 221
      99,259 95,509
Special items  
Staff costs – redundancy (note 8)      1,259 525
Staff costs – pensions (note 8)      50 –
Other external charges – other reorganisation costs     2,152 1,465
Asset write offs on closure      50 –
Raw material and consumables – stock write downs and onerous contracts   130 180
Share-based payments      56 (28)
Amortisation of acquired intangibles      3,054 2,083
Loss on revaluation of investment properties     335 800
      7,086 5,025
      106,345 100,534
4. Auditors’ remuneration  
Auditors’ remuneration is included within other external charges and consists of the following:  
      2009 2008
      £000 £000
Audit of these financial statements      60 64
Audit of subsidiaries pursuant to such legislation     146 52
Other services relating to taxation      67 1 1 1
All other services      152 55
      425 282
Amounts paid to the Company’s auditors and their associates 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.
In addition fees of £273,000 were included as issue costs deducted from share premium which arose in relation to the Placing and  
Open Offer and Firm Placing.
  Financial statements Notes to the financial statements
47 Cosalt plc Annual report & financial statements 2009
5. Discontinued operations
Banner, the Group’s Schoolwear segment, was sold on 13 May 2008 to IDP (Holdings) Ltd for a total consideration of £4.5 million,  
of which £1.5 million was received in cash on completion. The remaining £3.0 million was satisfied by 2008 – 2020 loan notes 
repayable by the end of 2010 and paying interest of 7% per annum from 13 May 2009. During the year the outstanding amounts 
under the loan notes were repaid less an amount of discount for early repayment of £604,213.
Holiday Homes, the Group caravan and custom home lodge manufacturing business was sold on 25 October 2008 for a nominal 
consideration to entities within the Endless Group. The sale included the freehold properties the business operated from.
Losses attributed to the discontinued operations for the 52 weeks ended 26 October 2008 were as follows:
     52 weeks ended 26 October 2008
     Schoolwear Holiday Homes Total
     £000 £000 £000
Results of discontinued operations   
Revenue     5,958 37,148 43,106
Expenses     (8,510) (52,712) (61,222)
Loss profit before income tax     (2,552) (15,564) (18,116)
Income tax credit     – 1,816 1,816
Loss from operating activities, net of income tax    (2,552) (13,748) (16,300)
Loss from sale of discontinued operations      (6,139) (3,022) (9,161)
Loss for the period     (8,691) (16,770) (25,461)
Cash flows from discontinued operations   
        Schoolwear
       52 weeks ended
       26 October 2008
       £000
Cash flows from discontinued operations   
Net cash from operating activities       3,042
Net cash from investing activities       (9)
Net cash from financing activities       –
Net cash generated from discontinued operations      3,033
  
       Holiday Homes
       52 weeks ended
       26 October 2008
       £000
Cash flows from discontinued operations   
Net cash from operating activities       7,648
Net cash from investing activities       (812)
Net cash from financing activities       (6,574)
Net cash generated from discontinued operations      262
Effect of disposal on the financial position of the Group
      53 weeks ended 26 October 2008
      Schoolwear Holiday Homes
      £000 £000
Goodwill      640 –
Property, plant and equipment      1,001 222
Inventories      6,497 3,611
Trade and other receivables      3,986 6,674
Cash and cash equivalents      – 534
Deferred tax      – (3,254)
Trade and other payables      (2,340) (4,231)
Net identifiable assets and liabilities      9,784 3,556
Consideration received      3,645 –
Cash disposed of      – 534
Net cash outflow      6,139 534
Loss on disposal      6,139 3,022 Financial statements Notes to the financial statements
48 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
6. Financing costs    
      2009 2008
      £000 £000
Bank borrowings      2,488 1,737
Finance lease      55 31
On shares classified as financial liabilities      4 4
Debt factoring      – 561
Pension scheme      738 150
Other interest      (193) 495
Other interest – special items      523 –
Refinancing costs – special items      1,235 718
      4,850 3,696
Discontinued activities      – (624)
Continuing activities      4,850 3,072
7. Financial income    
      2009 2008
      £000 £000
Interest receivable      18 89
8. Directors and Employees    
    Continuing Continuing Discontinued Total
    2009 Operations Operations 2008
    £000 £000 £000 £000
Staff costs:    
Wages and salaries    25,138 22, 164 14,816 36,980
Share-based payments    56 (28) – (28)
Social security costs    2,944 2,300 1,167 3,467
Other pension costs    891 456 558 1,014
    29,029 24,892 16,541 41,433
The division of Staff costs in arriving at operating profit is as follows:    
      2009 2008
      £000 £000
Normal costs      27,720 24,367
Pensions – special items      50 –
Redundancy costs – special items      1,259 525
      29,029 24,892
 
The average number of Employees of the Group during the year was:
      2009 2008
      Number Number
Head Office and Directors      10 9
Marine UK      416 527
Marine Europe      137 89
Offshore UK      228 222
Offshore Europe      31 30
Schoolwear      – 116
Holiday Homes      – 414
      822 1,407
Details of Directors’ emoluments and interests are given in the Remuneration report on pages 26 to 28. 
  Financial statements Notes to the financial statements
49 Cosalt plc Annual report & financial statements 2009
9. Income tax expense    
      2009 2008
      £000 £000
Current tax expense    
Current year      (597) 1,798
Adjustments in respect of prior year      439 –
      (158) 1,798
Overseas tax      605 569
      447 2,367
Deferred tax expense    
Origination and reversal of temporary differences    
Current year      (1,053) (1,484)
Adjustments in respect of prior year      (157) (12)
Total tax (credit) expense       (763) 871
Reconciliation of effective tax rate    
    2009 2009 2008 2008
    % £000 % £000
(Loss)/profit before taxation    – (3,350) – 1,490
Tax using domestic corporation tax rate      (28.0) (938) 28.9 430
Effect of overseas tax rates    (1.9) (65) (1.4) (21)
Net items not taxable    (0.3) (12) 16.3 243
Revaluation of investment properties    1.7 58 15.5 231
Capital disposal covered by capital losses    5.0 169 – –
Adjustments in respect of prior year    0.7 25 (0.8) (12)
    (22.8) (763) 58.5 871
Deferred tax recognised directly in equity    
      2009 2008
      £000 £000
Relating to actuarial losses/(gains) on pension schemes     1,518 (167)
 
10. Dividends
    2009 2009 2008 2008
    per share £000 per share £000
Ordinary shares 2007 Final: paid 4 April 2008   – – 6.00p 884
2008 Interim: paid 10 September 2008    – – 6.00p 1,578
    – – 12.00p 2,462 Financial statements Notes to the financial statements
50 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
11. Earnings per share
Basic earnings per share are calculated by dividing the profit attributable to equity holders of the parent by the weighted average 
number of ordinary shares in issue during the year.
Diluted earnings per share calculated by dividing the profit attributable to equity holders of the parent by the weighted average 
number of ordinary shares in issue during the year (adjusted for the effects of potentially dilutive options). Losses on basic earnings 
per share cannot be diluted and so where a loss has arisen this has not been diluted in calculating the diluted earnings per share.
The Group has only one category of dilutive potential ordinary shares which is that of share options granted to Employees.
   2009   2008 
   Potentially   Potentially 
   dilutive   dilutive 
   share   share 
  Basic options Diluted Basic options Diluted
Profit after tax (£000)      
Headline figure – Continuing operations   3,709   3,709 5,886 – 5,886
Statutory figure   (2,587) – (2,587) (24,842) – (24,842)
Weighted average number  of shares (thousands) 88,387 555  88,942 76,372 28 76,400
Earnings per share (pence)  
– Total operations      
Headline figure   4.20 (0.03) 4.17 (32.52) – (32.52)
Statutory figure  (2.93) – (2.93) (25.62) – (25.62)
Earnings per share (pence)  
– Continuing operations     
Headline figure   4.2 (0.03) 4.17 7.71 (0.01) 7.70
Statutory figure  (2.93) – (2.93) 0.81 – 0.81
The comparative figures for 2008 have been restated to take account of the bonus element of the pacing and open offer in 
September 2009. The restatement has been calculated using the theoretical ex-rights price of 5.27p. The total number of shares  
in issue at 1 November 2009 was 404,403,397.
There have been no transactions involving ordinary shares or potential ordinary shares between the reporting date and the date  
of approval of these financial statements which would significantly change the earnings per share calculations shown above.
12. Reconciliation of headline information to statutory information
      2009 2008
      £000 £000
Headline operating profit before tax and special items     8,568 9,498
Reorganisation cost (see note 3)      (3,641) (2,142)
Share-based payment      (56) –
Loss on revaluation of investment properties     (335) (800)
Amortisation of acquisition intangibles      (3,054) (2,083)
Statutory operating profit before tax       1,482 4,473
Financial income      18 89
Financing costs      (4,850) (3,072)
Statutory (loss)/profit before tax       (3,350)  1,490
  Financial statements Notes to the financial statements
51 Cosalt plc Annual report & financial statements 2009
13. Intangible assets
     Customer  
     and supplier  
     contracts and Computer 
    Goodwill relationships software Total
    £000 £000 £000 £000
Cost    
At 28 October 2007    27,471 15,534 3,204 46,209
Additions    – – 416 416
Acquisition of subsidiary undertakings    5,976 5,638 27 11,641
Disposals    (773) – (1,246) (2,019)
Exchange differences    743 189 1 933
At 26 October 2008    33,417 21,361 2,402 57,180
Additions    248 – 920 1,168
Disposals    – – (44) (44)
Exchange differences    1,274 1,123 14 2,411
At 1 November 2009    34,939 22,484 3,292 60,715
Accumulated amortisation    
At 28 October 2007    491 715 1,963 3,169
Amortisation charge for the year    – 2,083 608 2,691
Disposals    (133) – (1,064) (1,197)
Exchange differences    – 134 1 135
At 26 October 2008    358 2,932 1,508 4,798
Amortisation charge for the year    – 3,054 714 3,768
Disposals    – – (44) (44)
Exchange differences    – 272 14 286
At 1 November 2009    358 6,258 2,192 8,808
Net book value    
At 1 November 2009    34,581 16,226 1,100 51,907
At 26 October 2008    33,059 18,429 894 52,382
At 28 October 2007    26,980 14,819 1,241 43,040
Goodwill
As at 1 November 2009, the Consolidated balance sheet included Goodwill of £34,581,000. Goodwill is allocated to the Group’s 
cash generating units, or groups of cash-generating units, that are expected to benefit from the synergies of the business 
combination that gave rise to the goodwill as follows:
      2009 2008
Cash Generating Units (CGU)  Primary reporting segment    £000 £000
GTC Group Offshore     17,287 1 7, 184
Bofort SSM Marine     8,179 7,389
Marine safety Marine     1,823 1,823
Safety workwear Marine     827 827
Myhre-Maritime Offshore     6,465 5,836
      34,581 33,059
Impairment tests for cash generating units containing goodwill
The recoverable amount of each CGU is based on value in use calculations. These calculations are based on estimates using  
the pre-tax cash flow projections derived from the Group’s one year budget and extrapolated beyond this using average growth 
rates of between 2% and 3% (2008: 3%-5%) and using a pre-tax market discount rate. The discount rate used reflects the  
Group’s pre-tax weighted average cost of capital of 10.3% (2008: 10.3%) adjusted for CGU risk factors which results in rates  
of 16.4%-19.5% (2008: 10%-12%).
This results in payback periods of 12 years for Myhre-Maritime, 8 years for GTC Group and 7 years for Bofort SSM.
Goodwill arising on business combinations is not amortised, being reviewed for impairment on an annual basis or more  
frequently if there are indications that goodwill may be impaired. Goodwill acquired in a business combination is allocated  
to cash-generating units. Financial statements Notes to the financial statements
52 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
14. Tangible fixed assets
     Short  Freehold  
   Freehold leasehold investment  
   properties properties properties Plant Total
   £000 £000 £000 £000 £000
Cost and valuation     
At 28 October 2007   4,807 1,769 3,900 22,119 32,595
Subsidiaries at acquisition   – – – 299 299
Additions   651 221 – 3,228 4,100
Revaluations and adjustments   – – (800) – (800)
Disposals   (3,255) (334) – (7,141) (10,730)
Exchange differences   47 31 – 99 177
At 26 October 2008   2,250 1,687 3,100 18,604 25,641
     
Aggregate depreciation     
At 28 October 2007   1,242 822 – 13,235 15,299
Amount charged to profit and loss account  149 66 – 4,716 4,931
On disposals   (600) (227) – (6,676) (7,503)
Exchange differences   48 16 – 170 234
At 26 October 2008   839 677 – 11,445 12,961
     
Net book values     
At 26 October 2008   1,411 1,010 3,100 7,159 12,680
At 28 October 2007   3,565 947 3,900 8,884 17,296
     
Cost and valuation     
At 26 October 2008   2,250 1,687 3,100 18,604 25,641
Subsidiaries at acquisition   – – – – –
Additions   56 327 – 2,350 2,733
Revaluations and adjustments   (823) – 440 468 85
Disposals   – (80) – (3,350) (3,430)
Exchange differences   – 19 – 585 604
At 1 November 2009   1,483 1,953 3,540 18,657 25,633
     
Aggregate depreciation     
At 26 October 2008   839 677 – 11,445 12,961
Amount charged to profit and loss account  38 79 – 2,096 2,213
Revaluations and adjustments   (368) –  68 (300)
On disposals   – (80) – (2,404) (2,484)
Exchange differences   – – – 301 301
At 1 November 2009   509 676 – 11,506 12,691
     
Net book values     
At 1 November 2009   974 1,277 3,540 7,151 12,942
At 26 October 2008   1,411 1,010 3,100 7,159 12,680
(a)  Valuations of trading properties in 1988 were at open market value on an existing use basis. 
(b)  Short leaseholds are those with a term of under 50 years to run. Plant includes vehicles. 
(c)  Group assets costing £5,727,000 (2008: £4,868,000) have been fully depreciated and are still in use. 
(d)    Group plant includes assets at cost of £16,989,000 (2008: £16,175,000) and accumulated depreciation of £11,882,000  
(2008: £11,259,000) which are leased to third parties and have generated income of £8,127,000 (2008: £13,802,000,) during  
the year. 
  Financial statements Notes to the financial statements
53 Cosalt plc Annual report & financial statements 2009
The following tangible fixed assets held under finance leases are included in plant:
      2009 2008
      £000 £000
Cost      3,190 3,729
Depreciation      1,444 2,392
Net book values      1,746 1,337
The depreciable amount of trading properties is:  
       Short
      Freehold leasehold
      £000 £000
1 November 2009      1,419 2,109
26 October 2008      1,584 1,831
Future capital expenditure  
      2009 2008
      £000 £000
Contracted for but not provided for in the accounts     – 76
Investment properties
The Group holds investment properties with a fair value of £3,540,000 as at 1 November 2009 (2008: £3,100,000). The properties 
were revalued by a suitably qualified independent valuer at market value and in accordance with the Royal Institution of Chartered 
Surveyors (RICS) Appraisal and Valuation Standards (5th Edition). Following the revaluations a loss of £335,000 has been 
recognised in the period to 1 November 2009 (period to 26 October 2008: loss £800,000).
During the period the Group vacated a freehold property and this was transferred to investment properties at £775,000. The 
increase in value of £614,000 from its net book value has been recognised in revaluation above. Future changes in valuation will  
be recognised through investment property revaluation above.
15. Investments
      2009 2008
      £000 £000
Other investments      350 2,728
Other investments consist of preference shares held in respect of the Knox business disposed of in November 2004 (2008 
preference shares and loan stock in respect of Knox and loan stock in respect of Banner).
16. Inventories
      2009 2008
      £000 £000
Raw materials      3,461 5,769
Work in progress      2,743 2,310
Finished goods and goods for resale      12,683 11,305
      18,887 19,384
Inventories are presented net of provision for inventory write downs, based on management’s estimate of the net realisable value  
of inventories. The cumulative effect of those write downs was to reduce inventories by £2,580,000 (2008: £2,237,000). The amount 
charged to income statement in the year in respect of write downs net of credits for reversals was £343,000 (2008: credit £19,000). Financial statements Notes to the financial statements
54 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
17. Trade and other receivables
      2009 2008
      £000 £000
Trade receivables      18,317 24,257
Other receivables and prepayments      3,983 3,143
      22,300 27,400
 
Trade receivables are presented net of provisions for impairment of £995,000 (2008: £872,000) estimated by management based  
on previous experience of default.
 
The ageing of trade receivables not impaired based on due date is as follows:
      2009 2008
      £000 £000
Current      11,215 14,420
Up to 30 days overdue      3,323 4,1 77
Between 30 and 90 days overdue      3,020 3,798
Over 90 days overdue      759 1,862
      18,317 24,257
Trade and other receivables are non-interest bearing and there is no material difference the between carrying amount and fair value.
18. Derivative financial instruments
   Assets  Liabilities  Net
  2009 2008 2009 2008 2009 2008
  £000 £000 £000 £000 £000 £000
Forward foreign currency contracts  35 622 – – 35 622
Interest rate cap and floor  – – (1,018) (381) (1,018) (381)
  35 622 (1,018) (381) (983) 241
The fair value of derivative financial instruments is equal to the carrying value. The fair value of forward foreign current contracts 
represents the gain or loss resulting from translation of those contracts at forward rates applicable at the balance sheet date 
compared to actual contract rates. The fair value of interest rate cap and floor contracts, represent the market value of a comparable 
instrument at the balance sheet date.
19. Deferred taxation
Recognised deferred taxation assets and liabilities
   Assets  Liabilities  Net
  2009 2008 2009 2008 2009 2008
  £000 £000 £000 £000 £000 £000
Intangible assets  – – (4,559) (5,166) (4,559) (5,166)
Property, plant and equipment  546 277 – – 546 277
Employee benefits  3,267 1,747 – – 3,267 1,747
Other items  664 564 – – 664 564
Tax assets/(liabilities)  4,477 2,588 (4,559) (5,166) (82) (2,578)
The deferred taxation asset of £3,267,000 (2008: £1,747,000) in relation to Employee benefits is in respect of the liability for the 
defined benefit obligations of £11,759,000 (2007: £6,280,000) (note 27 on page 68) calculated at 28% (2007: 28%). Deferred tax 
assets have not been recognised in respect of capital losses of £1,754,000 in 2007. In so far as they are used to cover revaluation 
gains on investment properties. Financial statements Notes to the financial statements
55 Cosalt plc Annual report & financial statements 2009
Movement in net deferred tax assets/(liabilities) are as follows:
   Property,  Retirement  
   plant and Intangible benefit Other 
   equipment assets obligations items Total
   £000 £000 £000 £000 £000
At 28 October 2007   (576) (4,146) 2,463 62 (2,197)
Credited/(charged) to income statement   807 558 (307) 502 1,560
Charged to equity   – – (409) – (409)
Acquisition   46 (1,578) – – (1,532)
Exchange differences   – – – – –
At 26 October 2008   277 (5,166) 1,747 564 (2,578)
At 26 October 2008   277 (5,166) 1,747 564 (2,578)
Credited/(charged) to income statement   261 849 – 100 1,210
Charged to equity   – – 1,518 – 1,518
Exchange differences   8 (242) 2 – (232)
At 1 November 2009   546 (4,559) 3,267 664 (82)
20. Interest bearing 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 and foreign currency risk, see page 25.
      2009 2008
      £000 £000
Non-current liabilities       
Secured bank loans      15,421 –
Unsecured bank loans      – 26,940
Shares classified as liabilities      50 50
Finance lease liabilities      782 626
      16,253 27,616
Current liabilities       
Current portion of secured bank loans      3,509 –
Current portion of unsecured bank loans      – 1, 1 1 1
Finance lease liabilities      360 262
      3,869 1,373
Terms and debt repayment schedule as at 1 November 2009
 Fixed or  Effective  Less than 1 to 2 2 to 3 3 to 4
 variable  interest Total 1 year years years years 5 years +
 rate  rate % £000 £000 £000 £000 £000 £000
Secured bank loans Variable  5.65 18,929 3,509 7,609 7,799 11 1
Finance lease liabilities Fixed  5.75 1,143 360 322 197 200 64
    20,072 3,869 7,931 7,996 211 65
Terms and debt repayment schedule as at 26 October 2008
 Fixed or  Effective  Less than 1 to 2 2 to 3 3 to 4
 variable  interest Total 1 year years years years 5 years +
 rate  rate % £000 £000 £000 £000 £000 £000
Unsecured bank loans Variable  7.57 28,051 1,111 3,500 23,440 – –
Finance lease liabilities Fixed 5.75 888 262 250 190 85 101
   28,939 1,373 3,750 23,630 85 101
Bank loans
The Group re-negotiated its existing committed unsecured £34 million facility in March 2009 to include a further £5 million but  
on a secured basis. The facility was further amended in September 2009 as a result of the firm placing and placing an open offer. 
The revised facility includes a committed revolving credit of £19.1 million through to March 2012, with a margin currently at 3.75% 
above LIBOR. Also, term facilities of £10.1 million with a margin currently at 3.75% above LIBOR and scheduled repayments  
through to March 2012, including 3.5m on 22 October 2010 and £3 million with a margin of 9% above LIBOR, with scheduled 
repayment on 31 January 2011.
These bank borrowings are secured by a debenture over the Group’s assets. As part of the negotiations a share in the security over 
the assets was given to the Trustees of the Cosalt plc Retirement Benefit Plan. Financial statements Notes to the financial statements
56 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
20. Interest bearing loans and borrowings continued
Financial instruments
The Group operations are primarily financed from retained earnings, bank finance and leasing. In addition, the Group adjusts  
its capital structure as required to safeguard its ability to continue as a going concern which may include the adjustment of the 
dividend, raising equity from shareholders or selling assets. It is the Group’s policy not to trade in or enter into speculative 
transactions. Following the placing and open offer on 2 September 2009 the Group amended the secured committed facilities  
to £33 million consisting of revolving credit facilities with maturity in March 2012 and Term facilities with scheduled repayments 
through to March 2012.
Debt is principally raised centrally and the Group aims to maintain a balance between flexibility and continuity of funding by having  
a range of maturities on its borrowings. 
The Group’s policy is to maintain a mixture of floating and fixed rate borrowings. In order to provide protection against significant 
interest rate rises in the future, the Board purchased a cap. The amount covered by the cap reduces in line with the repayments  
on the term loan. A floor transaction was taken out at the same time and on the same basis in order to minimise the upfront  
premium for this cover. The Group’s exposure to foreign currency fluctuations has increased with the acquisition of businesses  
in mainland Europe and Norway in the last two years. The Group’s policy is to eliminate currency exposure by the use of forward 
currency contracts and foreign currency borrowings as a natural hedge against foreign investment value.
 
Financial risk management
(a) Credit Risk
The Group’s exposure to credit risk is limited to the carrying amount of financial assets recognised at the balance sheet date which 
are set out below:
      2009 2008
      £000 £000
Cash and cash equivalents      1,493 2,1 71
Trade receivables      18,317 24,557
      19,810 26,728
Potential customers are credit checked prior to an account being created for them and before any orders for product are accepted 
and processed. All debts are closely controlled and monitored by management. The Group continuously monitors defaults of 
customers and other counterparties and incorporates this information into its credit risk controls. The Group policy is to deal only 
with credit worthy companies.
Management considers that all the above financial assets that are not impaired for each of the reporting dates under review are  
of good credit quality, including those that are past due.
The Group’s financial assets are secured by debentures under its banking arrangements at the year-end date of 1 November 2009.
In respect of trade and other receivables, the Group is not exposed to any significant credit risk exposure to any single counterparty 
or any group of counterparties having similar characteristics.
The credit risk for liquid funds is not considered significant, since the counterparty is a reputable bank with a high quality external 
credit rating. Financial statements Notes to the financial statements
57 Cosalt plc Annual report & financial statements 2009
(b) Liquidity Risk
The Group manages its liquidity needs by carefully monitoring all scheduled cash outflows, through a process of cash flow 
forecasting, daily and weekly monitoring and monthly review the Group monitors working capital and capital expenditure 
requirements. Liquidity risk is further managed by the agreement of term loans and working capital facilities, when necessary.
     Less than 1 to 2 2 to 3 3 to 4
    Total 1 year years years years 5 years +
1 November 2009    £000 £000 £000 £000 £000 £000
Non-derivative financial liabilities
Secured borrowings    22,305 5,121 9,094 8,077 12 1
Finance lease liabilities    1,267 416 357 218 210 66
Trade and other payables    25,939 24,366 1,266 307 – –
Provisions    177 177 – – – –
Derivative financial liabilities 
Interest rate cap and floor    1,018 539 479 – – –
    50,706 30,619 11,196 8,602 222 67
     Less than 1 to 2 2 to 3 3 to 4
    Total 1 year years years years 5 years +
26 October 2008    £000 £000 £000 £000 £000 £000
Non-derivative financial liabilities
Un-secured borrowings    31,084 2,940 4,662 23,482 – –
Finance lease liabilities    988 306 279 206 93 104
Trade and other payables (exclude Mel)   40,164 40,164 – – – –
Provisions    115 42 73 – – –
Derivative financial liabilities 
Interest rate cap and floor    381 140 128 113 – –
    72,732 43,592 5,142 23,801 93 104
The figures above include the contractual undiscounted payments and interest and will therefore not necessarily tie back to the 
figures disclosed in the accounts.
The Group has recently renegotiated its banking facilities, the maturity profile of the Group’s external borrowings at 1 November 2009 
are shown on page 55.
The Group had undrawn committed borrowing facilities, under its three-year facilities agreement at 1 November 2009  
of £11,449,000 (2008: £6,339,000).
The Group is subject to quarterly covenant tests in respect of its banking facilities. The tests cover leverage, fixed charge and cash 
flow. The leverage covenant is a requirement to maintain a ratio of net debt to annualised EBITDA, which excludes special items  
of less than 2.5 times in all periods other than January 2010 when it is 2.75 times. The fixed charge cover covenant is a requirement 
to maintain a ratio of the previous 12 months underlying EBITA, which excludes special items, plus operating rent to underlying  
net interest payable plus operating rent of greater than 2 times in all periods other than January 2010 when it is 1.9 times. The  
cash flow covenant is a requirement to maintain a ratio of underlying net cash flow to underlying debt service of at least 1.1 times.
The Group has complied with its banking covenants throughout the year and at its year end. Financial statements Notes to the financial statements
58 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
20. Interest bearing loans and borrowings continued
Financial risk management continued
(c) Interest Rate Risk
The Group finances its operations through a combination of shareholders funds and when appropriate, bank loans and overdrafts. 
The interest rate profile of the Group’s interest bearing financial instruments is shown on page 55.
Sensitivity Analysis
A change of 100 basis points in interest rates at the reporting date would change profit and loss by the amounts shown below,  
this analysis assumes all other variables, including foreign exchange rates remain constant.
      2009 2008
      £000 £000
100 basis points in interest rates      186 317
(d) Foreign Currency Risk
The Group faces currency exposure on trading transactions undertaken by its subsidiaries in foreign currencies. The Group 
coordinates the hedging of specific exposures by taking out forward foreign exchange contracts, against its anticipated known  
sales and purchases. The decision to hedge is influenced by the size of exposure, the certainty of it arising, the trading and market 
position of the subsidiary in which the exposure arises and the current exchange rate. All of the forward exchange contracts have 
maturities of less than one year after the balance sheet date. Where necessary, the forward contracts are rolled over at maturity.
The Group classifies it forward exchange contracts as cash flow hedges and states them at fair value and adjusts them against  
the hedging reserve on an ongoing basis.
The Group’s exposure to forward exchange contracts, measured at fair value, is as follows:
      2009 2008
      £000 £000
Forward contracts      35 622
The Group’s balance sheet translation exposure is managed by substantially matching currency assets with currency borrowings. 
The Group has borrowings denominated in Euro’s, which are matched against similar denominated assets.
Sensitivity Analysis
In managing interest rate and currency risks the Group aims to reduce the impact of short-term fluctuations over the Group’s 
earnings. Over the longer term, however, permanent changes in foreign exchange and interest rates would impact on consolidated 
earnings.
(e) Capital Risk Management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to 
provide returns to Shareholders and benefits to other stakeholders, and to maintain an optimal capital structure to reduce the cost 
of capital. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, 
return capital to shareholders, issue new shares or sell assets to reduce debt. The Group monitors capital on the basis of the 
gearing ratio. This ratio is calculated as net debt divided by total shareholders’ equity as shown below:
      2009 2008
      £000 £000
Continuing and discontinued operations
Cash and cash equivalents      1,493 2,1 71
Short term debt and current portion of long term debt     (3,869) (1,373)
Long term debt      (16,253) (27,616)
Net debt      (18,629) (26,818)
Total Shareholders equity      49,404 37,555
Gearing ratio      37.7% 71.4%
  Financial statements Notes to the financial statements
59 Cosalt plc Annual report & financial statements 2009
Fair value of financial instruments (2009)
       At 1 Nov 09
      Book Fair
      amount value
      £000 £000
Cash      1,493 1,493
Short-term debt and current portion of long-term debt     (3,869) (3,869)
Long-term debt      (16,253) (14,777)
Interest rate cap and floor      (1,018) (1,018)
Forward contracts      35 35
Trade receivables      18,317 18,317
Trade payables      (13,893) (13,893)
Total financial instruments      (15,188) (13,712)
Fair value of financial instruments (2008)  
       At 26 Oct 08
      Book Fair
      amount value
      £000 £000
Cash      2,171 2,171
Short-term debt and current portion of long-term debt     (1,373) (1,373)
Long-term debt      (27,616) (27,616)
Interest rate cap and floor      (381) (381)
Forward contracts      622 622
Trade receivables      24,557 24,557
Trade payables      (21,324) (21,324)
Total financial instruments      (23,344)  (23,344)
£1,457,000 (2008: £1,910,000) of the cash at bank and in hand is held in foreign currency deposits and is subject to banking set offs.
The assumptions used to estimate fair values are as follows:
(i)  for cash and short-term debt the book value approximates to fair value due to the short maturity period; 
(ii)   the fair value of long-term debt has been calculated by discounting the estimated cash flows at the appropriate market discount 
rate at the balance sheet date; 
(iii)   the fair values of the interest rate cap and floor and forward contracts are the market values at the balance sheet date. 
21. Trade and other payables
      2009 2008
      £000 £000
Trade payables      13,893 21,324
Non trade payables and accrued expenses     11,828 18,775
      25,721 40,099
22. Provisions  
      Other
      provisions Total
      £000 £000
At 26 October 2008      115 115
Utilised      (73) (73)
Charged to the income statement during the year     135 135
At 1 November 2009      177 177
Due within one year      177 177
Other provisions in the Group include rectification cost, product warranty and liability provisions.  
  Financial statements Notes to the financial statements
60 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
23. Called up share capital
     Authorised Issued and fully paid
    2009 2008 2009 2008
   Note £000 £000 £000 £000
7.50% Cumulative Preference Shares of £1 each   250 250 50 50
Ordinary Shares of 25p each    – 7,750 – 6,601
Treasury Shares    – (55) – (14)
Ordinary Shares of 1p each    566,318 – 4,044 –
Treasury Shares    (55) – (2) –
Deferred Ordinary Shares of 24p each    48,000 – 6,337 –
Treasury Shares    (55) – (43) –
    614,458 7,945 10,386 6,637
Shares classified as liabilities   20   50 50
Shares classified in Shareholders’ funds      10,336 6,587
      10,386 6,637
7.50% Cumulative Preference Shareholders (non-equity interests) have the following rights:
(i) in priority to ordinary Shareholders, to a fixed cumulative preference dividend at a rate of 7.50% per annum; 
(ii)  on a return of capital on a winding up, will carry the right to repayment of capital together with a sum equal to any arrears  
of dividend in priority to the rights of ordinary Shareholders; 
(iii)  to attend and vote at a general meeting of the Company only in certain limited circumstances where the special rights attaching 
to these shares might be varied or their interest affected. 
During the year the ordinary shares of 25p were subject to a Capital Reorganisation. Following approval at a General Meeting  
on 1 September 2009, each ordinary share of 25p was subdivided into one redenominated share of 1p and one deferred share  
of 24p. Each of the remaining authorised but unissued ordinary shares were then subdivided into 25 redenominated shares  
of 1p each.       
          
The following issues of redenominated ordinary shares occurred during the year:   
(i)   On 2 September 2009 180,000,000 new ordinary shares of 1p were issued at a price of 5p per share through a placing and  
open offer
(ii)  On 2 September 2009 198,000,000 new ordinary shares of 1p were issued at a price of 5p per share through a firm offer 
          
The deferred shares are subject to the following restrictions:     
(i)  they do not entitle their holder to receive any dividend or other distribution;    
(ii)   they do not entitle their holder to receive a share certificate in respect of the relevant shareholding, except as required by law 
(iii)  they do not entitle their holder to receive notice of, nor attend, speak or vote at, any general meeting of the Company;
(iv)  they only entitle their holder on a return of capital on a winding-up (but not otherwise) only to the repayment of the amount  
paid up on that share but only after payment of the amounts entitled to be paid to the holders of preference shares, the capital 
paid up on each Ordinary Share and the further payment of £10,000,000 on each Ordinary Share,
(v) do not entitle their holder to any further participation in the capital, profits or assets of the Company; and 
(vi) they can only be transferred only on prior written consent of the Directors of the Company.
The Company also has the power to transfer deferred shares, for nil consideration, to a Company appointed Trustee or to cancel  
the shares without making payment to the holder.
Share-based payments
The Group operated an Inland Revenue approved and an unapproved share option plan the details of which are provided below. 
Both Plans have now reached their 10 year life and no further options will be granted under these arrangements. In accordance  
with IFRS 2, only costs relating to options issued after 7 November 2002 and not vested at 1 January 2005 have been charged  
to the income statement.
A deferred bonus plan was approved in 2006 whereby eligible Employees are able to take up to 100 per cent of their post-tax  
bonus in the form of ordinary shares and, subject to certain performance criteria, matching shares are awarded after a three year 
performance period. No awards have yet been made under these arrangements.
A new Performance Share Plan (PSP) was approved by Shareholders at the 2006 Annual General Meeting. No nil cost options  
have been issued in the financial year.  Financial statements Notes to the financial statements
61 Cosalt plc Annual report & financial statements 2009
23. Called up share capital continued
Share-based payments continued
The Performance Share Plan provides for nil (or nominal) cost share options or restricted shares (where the shares are forfeited  
if performance conditions are not met) to be issued in any financial year up to 100 per cent of basic salary. In circumstances 
deemed exceptional by the Remuneration Committee this can be increased to 200 per cent. Awards are subject to the achievement 
of performance targets measured over a fixed period of three financial years determined by the Remuneration Committee.
Share options and nil cost options have been issued in previous years to senior management, including the Executive Directors,  
and also regional Management of the operating businesses. Vesting of share option awards is dependent on performance criteria  
as set out in the Remuneration Report.
Share options and restricted shares have been valued by an external third party using the binominal option-pricing model, based  
on publicly available market data at the time of grant, which the Directors consider to be the most appropriate method of 
determining fair value.
 
Reconciliations of share options outstanding during each period, under each type of share option is as follows:
    Share options 2009 Share options 2008
     Weighted  Weighted
    Number average Number average
    of share exercise of share exercise
Share options    options price options price
Outstanding at the beginning of the year    184,866 294.8p 453,579 283.9p
Granted during the year    – – – –
Lapsed during the year    32,440 289.5p (188,402) 289.5p
Exercised during the year    – – (80,311) 228.6p
Outstanding at the end of the year    152,426 295.9p 184,866 294.8p
Exercisable at the end of the year    – – 34,346 294.8p
The options outstanding at 1 November 2009 have a range of exercise price of 222.5p to 343.0p and a weighted average remaining 
contractual life of 1.5 years.
      PSP PSP
PSP      2009 2008
Outstanding at the beginning of the year      612,804 55,458
Restricted shares issued during year      – 612,804
Lapsed/forfeited during the year      (58,240) (55,458)
Outstanding at end of year      554,564 612,804
The inputs into the Black-Scholes pricing model were as follows:     
    PSP   Share options
 2008 2008 2007 2007 2006 2005 2004
Grant date 13 August 21 July 26 October 17 April 1 August 1 August 1 July
Risk free interest rate 4.5% 4.5% 4.5% 5.9% 5.0% 4.9% 4.7%
Exercise price  – – – – 292.0p 269.0p 309.0p
Share price at date of grant 244.5p 243.0p 368.5 378.7p 292.0p 269.0p 309.0p
Expected dividend yield 4.5% 4.5% 4.5% 4.5% 5.8% 5.8% 5.8%
Expected life 3.75 years 3.75 years 3.75 years 5 years 6 years 6 years 6 years
Vesting period 3.75 years 3.75 years 3.75 years 3 years 5 years 5 years 5 years
Expected volatility 30% 30% 30% 26% 20% 26% 26%
Fair value of option 206.5p 205.3p 311.3p 332.6p 33.17p 43.67p 49.22p
Expected volatility was determined by calculating the historical volatility of the Group’s share price over various timescales.
The expected life used in the model has been adjusted, based on best estimates to reflect exercise restrictions and behavioural 
considerations.
In 2009 the Group recognised a total charge of £56,000 (2008: credit £28,000) in relation to equity-settled share-based payment 
transactions which are included in special items within operating profits.
  Financial statements Notes to the financial statements
62 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
24. Summary of movements in equity
 Share Share Merger Other Translation Hedging Retained
 capital premium reserve reserves reserve reserve earnings Total
 £000 £000 £000 £000 £000 £000 £000 £000
Balance brought forward  
at 28 Oct 07 6,157 31,985 6,703 1,148 256 (96) 12,657 58,810
Loss for the year – – – – – – (24,842) (24,842)
Shares issued in year 430 2,573 883 – – – – 3,886
Share option credit – – – – – – (28) (28)
Currency translation differences         
(net of tax) – – – – 601 – – 601
Change in value of hedged items – – – – – 337 – 337
Movement in pension deficit         
and taxation thereon – – – – – – 1,253 1,253
Dividends – – – – – – (2,462) (2,462)
Balance as at 26 Oct 08 6,587 34,558 7,586 1,148 857 241 (13,422) 37,555
Loss for the year – – – – – – (2,587) (2,587)
Property revaluation – – – – – – 614 614
Shares issued in year 3,749 13,557 – – – – – 17,306
Share option charge – – – – – – 56 56
Currency translation differences         
(net of tax) – – – – 1,812 – – 1,812
Change in value of hedged items – – – – – (1,224) – (1,224)
Movement in pension deficit  
and taxation thereon – – – – – – (4,128) (4,128)
Dividends – – – – – – – –
Balance as at 1 Nov 09 10,336 48,115 7,586 1,148 2,669 (983) (19,467) 49,404
Other reserves consist of a Capital Redemption Reserve £814,000, a Capital Reserve £197,000 and a pre-acquisition profit and  
loss reserve £438,000.
Translation reserve
The translation reserve comprises all foreign exchange differences arising from the translation of the financial statement of foreign 
subsidiaries together with those from the translation of liabilities that hedge the Group’s net investment in foreign subsidiaries.
Hedging reserve
The hedging reserve comprises the effective portion of the cumulative net charge in the fair value of cash flow hedging instruments 
related to hedged transactions that have not yet occurred. Financial statements Notes to the financial statements
63 Cosalt plc Annual report & financial statements 2009
25. Contingent liabilities
Cosalt plc has guaranteed leasing and other arrangements of subsidiary undertakings in the ordinary course of business.
 
26. Operating leases
The future minimum lease payments of commitments due under non-cancellable operating leases are: 
(i) Land and buildings
      2009 2008
      £000 £000
Within one year      2,140 1,821
Between two and five years      5,887 5,313
In five years or more      1,549 2,311
      9,576 9,445
(ii) Plant  
      2009 2008
      £000 £000
Within one year      2,712 393
Between two and five years      289 2,742
In five years or more      – 17
      3,001 3,152
Total leases      12,577 12,597
The majority of leases of land and buildings are subject to rent reviews.  
(iii) Operating lease receivables  
The Group both rents out its investment properties and also sub-lets various leased buildings under operating leases. 
At the Balance Sheet date, the following future minimum lease payments are contractually receivable from tenants: 
      2009 2008
      £000 £000
Within one year      20 62
Between two and five years      – –
After five years      – –
Total minimum lease payments      20 62 Financial statements Notes to the financial statements
64 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
27. Retirement benefit obligations
The Group operates a number of defined benefit post-retirement schemes in various countries. The scheme assets are held in 
separate trustee administered funds. The cost of the schemes and contributions to funding are assessed on advice of independent 
qualified actuaries using the projected unit method.
The principal scheme is the Cosalt plc Retirement Benefit plan in the UK. The disclosures include the effects of the other 
arrangements which in aggregate amount to 1% of the total deficit at 1 November 2009. In previous years these amounts had  
been included in accrued expenses.
As at 1 November 2009, the principal assumption adopted regarding the life expectancy of Members was in line with PA92 
(YOB=1965) mc rated up 1 year for deferred and active members and PA92 (YOB=1935) mc rated up 1 year for pensioners.  
This equates to an average life expectancy from age 65 for male deferreds/actives of 22.5 years and an average life expectancy  
from age 65 for male pensioners of 21.2 years.
The assets of the principal defined benefit scheme have been calculated at fair value and the liabilities, at each Balance Sheet  
date under IAS 19 (revised) have been calculated based on the following financial assumptions:
      1 November 26 October
      2009 2008
      % pa % pa
Discount rate      5.7 7.4
General pay increases      n/a n/a
Inflation assumption      3.6 3.5
Pension increases – Limited Price Indexation     3.5 3.4
Expected return on Scheme assets  
Equities      8.2 8.2
Bonds      4.7 4.7
Cash      4.0 4.0
Property      7.2 7.2
 
The major categories of Scheme assets as a percentage of the total fair value of Scheme assets are as follows:
      2009 2008
      % %
Equities      43.4 37.4
Bonds      50.8 55.2
Property      4.8 7.0
Cash      1.0 0.4
The amounts recognised in income are as follows:  
      2009 2008
      £000 £000
Interest cost      2,343 2,372
Expected return on Scheme assets      (1,605) (2,222)
Total interest cost      738 150
Actuarial loss/(gain)      5,941 (1,420)
Total debit/(credit) recognised in the SORIE in the period     5,941 (1,420)
Total defined benefit Scheme losses/(gains) recognised in the period    6,679 (1,270)
The overall expected rate of return on Scheme assets is a weighted average of the individual expected rates of return on each  
asset class. Financial statements Notes to the financial statements
65 Cosalt plc Annual report & financial statements 2009
The cumulative debit to the SORIE since the adoption of IAS 19 (revised) is £0.7 million (2008: credit of £3.4 million).
      2009 2008
      £000 £000
Expected return on Scheme assets      1,605 2,222
Actuarial gain/(loss) on Scheme assets      6,158 (7,597)
Actual return on Scheme assets      7,763 (5,375)
The amounts included in the Balance Sheet arising from the Group’s obligation in respect of its defined benefit scheme is as follows:
      2009 2008
      £000 £000
Present value of funded obligations      45,400 32,672
Fair value of Scheme assets      (33,641) (26,392)
Deficit in the Scheme and net liability in the balance sheet    11,759 6,280
A deferred tax asset totalling £3.27 million (2008: £1.75 million) has been recognised on the balance sheet in relation to the net 
pension obligation.
Movement in the liability recognised on the Balance Sheet is as follows:
      2009 2008
      £000 £000
At 26 October 2008      6,280 8,796
Total expenses – as shown above      6,679 (1,270)
Company contributions paid in the period      (1,200) (1,246)
At 1 November 2009      11,759 6,280
 
Changes in the present value of the defined benefit obligation were as follows:
      2009 2008
      £000 £000
At 26 October 2008      32,954 41,529
Interest cost      2,343 2,372
Actuarial losses      12,099 (9,057)
Benefits paid      (1,996) (1,890)
At 1 November 2009      45,400 32,954
Changes in the fair value of Scheme assets were as follows:    
      2009 2008
      £000 £000
At 26 October 2008      26,674 32,733
Expected return      1,605 2,222
Actuarial gains/(losses) on assets      6,158 (7,597)
Contributions      1,200 1,206
Benefits paid      (1,996) (1,890)
At 1 November 2009      33,641 26,674
A four year history of experience adjustments is as follows:    
    2009 2008 2007 2006
    £000 £000 £000 £000
Present value of defined benefit obligation    (45,400) (32,954) (41,529) (45,300)
Fair value of Scheme assets    33,641 26,674 32,733 32,121
Deficit in Scheme    (11,759) (6,280) (8,796) (13,179)
Experience adjustments on Scheme liabilities   (50) – 766 1,753
Percentage of Scheme liabilities    0.1% 0.0% 1.8% 3.9%
Experience adjustments on Scheme assets   3,499 (7 ,597) (1,374) 1,708
Percentage of Scheme assets    10.4% 28.5% 4.2% 5.3%
The expected employer contributions to the defined benefit scheme during 2010 are £1,200,000.   Financial statements Notes to the financial statements
66 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
continued
28. Acquisitions
On 1 August 2008 the Group acquired 100% of the ordinary share capital and associated voting rights of the Offshore business 
Myhre-Maritime A/S. The consideration and cash flows of this acquisition are summarised below.
       Total
       £000
Net identifiable assets and liabilities       6,459
Goodwill on acquisition       6,121
Consideration payable        12,580
Satisfied by      
Cash consideration (including expenses)       11,595
Equity shares issued       985
       12,580
Net cash 
Cash consideration       11,595
(Cash)/overdraft acquired       (229)
Net cash outflow       11,366
 
The effects on the Group’s assets and liabilities are detailed below.
     Provisional  Final
     fair value  fair value
     adjustments  adjustments  Movement 
     £000 £000 £000
Non-current assets   
Intangible assets     5,638 5,638 –
Current assets   
Inventories     (300) (406) (106)
Trade and other receivables     (100) (100) –
     (400) (506) (106)
Current liabilities   
Trade and other payables      (65) (65)
      – (65)
Non-current liabilities   
Deferred taxation     1,578 1,578 –
Net assets acquired     3,660 3,619 (41)
The provisional fair value adjustment reflected the initial adjustment required to assets and liabilities to align these with their  
fair values, Group accounting policies and to recognise intangible assets identified on acquisition and their associated deferred  
tax. These have been revised during the year and final adjustments made to the inventory provisions resulting in a revised  
goodwill figure.
Goodwill arising on acquisition represents the geographical strategic benefit of obtaining pan-European coverage. Financial statements
67 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
29. Related party transactions
Detailed disclosure of the individual remuneration of Board Members is included in the Remuneration Report on pages 26 to 28.  
With regard to the placing and open offer and firm placing on 2 September 2009 Messrs. Ross, Lejman and Reynolds underwrote  
an element of the placing and open offer but did not receive any fees.
Mr Melville became a Director on 30 November 2009. He had previously given a personal guarantee in favour of one of the  
Group’s subsidiary companies which had £290,000 outstanding at the 1 November 2009. The personal guarantee expired  
on 31 October 2009 and any residual amounts under the guarantee had been cleared by 31 December 2009.
There have been no other transactions between Key Management Personnel and the Company.
The Company has entered into transactions with its subsidiary undertakings in respect of the following:
• Internal funding loans 
• Provision of Group services (including senior management, IT, accounting, marketing and purchasing services) 
Recharges are made to subsidiary undertakings for Group loans based on funding provided at an interest rate linked to the 
prevailing base rate. No recharges are made in respect of balances due to or from otherwise dormant subsidiaries.
Recharges are made for Group services based on utilisation of those services.
In addition to these services the Company acts as a buying agent for certain Group purchases, such as insurance.
These are recharged based on utilisation by the subsidiary undertaking.
The amount outstanding from subsidiary undertakings to the Company at 1 November 2009 totalled £34 million (2008: £36 million). 
Amounts owed to subsidiary undertakings by the Company at 1 November 2009 totalled £3 million (2008: £7 million).
The Company provides the Group’s defined benefit pension scheme. Expected service costs are charged to the operating 
businesses at cost. There is no contractual arrangement or stated policy relating to the charge. Experience and actuarial gains  
and losses are recognised in the Company.
The Company has had no expense in respect of bad or doubtful debts of subsidiary undertakings in the year (2008: £nil).
 
30. Accounting estimates and judgements
Management discussed with the Audit Committee the development, selection and disclosure of the Group’s critical accounting 
policies and estimates and the application of these policies and estimates.
Key sources of estimation uncertainty
Note 13 contains information about the assumptions and their risk factors relating to goodwill impairment. In note 20 detailed 
analysis is given of the foreign exchange exposure of the Group and risks in relation to foreign exchange movements.
Pension assumptions
The assumptions used are the best estimates from a range of possible assumptions which due to the timescales may not 
necessarily be borne out in practice. Assumptions include inflation, future salary increases, discount rates and mortality rates.
Deferred taxation
The likelihood that assets are receivable is based on assumptions of future actions.
Critical accounting judgements in applying the Group’s accounting policies
Certain critical accounting judgements in applying the Group’s accounting policies are described below.
Investment property
Investment properties are valued at fair value based upon professional valuations. Given the Group’s strategy for development  
and its progress, a revaluation model is appropriate. Financial statements
68 Cosalt plc Annual report & financial statements 2009
Notes to the financial statements
30. Accounting estimates and judgements continued
Provisions
The Group’s reorganisation provisions are based on the best information available at the balance sheet date. However future  
costs are only estimates which may differ from those actually incurred.
Finance and operating leases
The inception of the leases of the Group took place many years ago. They are combined leases of land and buildings. It is not 
possible to obtain a reliable estimate of the split of the fair values of the lease interest between land and buildings at inception. 
Therefore, in determining lease classification the Group evaluated whether both parts are clearly operating leases or finance leases. 
Firstly, land title does not pass. Secondly, because the rent paid to the landlord for the building is increased to market rent at regular 
intervals, and the Group does not participate in the residual value of the building it is judged that substantially all the risks and 
rewards of the building are with the landlord. Based on these qualitative factors it is concluded that the leases are operating leases.
Intangible assets
The valuation of intangible assets is based on a number of assumptions which includes future discounted cash flows in respect  
of customer and supplier relationships over the expected useful lives of those relationships.
31. Group entities
The principal subsidiary undertakings at 1 November 2009 were as follows:
       Proportion
       of issued
       ordinary
Company Country of incorporation     shares held
Cosalt International Limited United Kingdom     100
GTC Holdings Limited* United Kingdom     100
GTC Group Limited* United Kingdom     100
Cosalt GmbH** Germany     100
Cosalt NV** Belgium     100
Cosalt BV** Netherlands     100
Cosalt Sistemas Maritima SL ** Spain     100
Cosalt Srl** Italy     100
Cosalt Offshore Norway A/S Norway     100
All subsidiary undertakings are consolidated within the Consolidated financial statements.
 
* Subsidiary companies acquired with the GTC Group acquisition. 
** Subsidiary companies acquired with the Bofort and SSM acquisitions. 
  Financial statements
69 Cosalt plc Annual report & financial statements 2009
Company balance sheet
    1 November 2009  26 October 2008
   Notes £000 £000 £000 £000
Fixed assets     
Tangible fixed assets   35  5,096  4,704
Investments   36  56,619  64,412
     61,715  69, 116
Current assets     
Debtors   37 36,686  36,236 
Bank and cash balances    –  – 
Derivative financial assets   40 35  622 
    36,721  36,858 
Creditors     
Amounts falling due within one year   38 15,471  24,289 
Derivative financial liabilities   40 1,018  381 
    16,489  24,670 
Net current assets     20,232  12,188
Total assets less current liabilities     81,947  81,304
Creditors     
Amounts falling due after more than one year  39  19,862  26,983
     62,085  54,321
Provisions for liabilities   41 728  763 
Deferred income     
Grants not yet credited to profit    6  7 
     734  770
Net assets     61,351  53,551
Capital and reserves     
Called up share capital   42  10,336  6,587
Share premium account   43  48,114  34,558
Merger reserve   43  7,586  7,586
Revaluation reserve   43  1,232  618
Investment property revaluation reserve   43  120  455
Translation reserve   43  (1,580)  (844)
Hedging reserve   43  (983)  241
Other reserves   43  814  814
Profit and loss account   43  (4,288)  3,536
Shareholders’ funds     61,351  53,551
The accounts were approved by the Board of Directors on 2 February 2010 and signed on its behalf by:
M T Reynolds M Lejman
Director  Director
The notes on pages 71 to 79 form part of these Company financial statements.
 
Company balance sheet Financial statements
70 Cosalt plc Annual report & financial statements 2009
Company reconciliation of movements in shareholders’ funds
      2009 2008
      £000 £000
(Loss)/profit for the financial year      (7,880) (1 7,646)
Dividends (2008: including non-equity)      – (2,462)
Retained loss for the financial year      (7,880) (20,108)
Share option charge/(credit)      56 (28)
Shares issued      17,336 3,900
Treasury shares      (31) (14)
Revaluation of investment properties      (335) (800)
Revaluation of trading properties      614 –
Currency translation difference      (736) (631)
Derivative financial instruments      (1,224) 241
Net increase/(decrease) in Shareholders’ funds for year     7,800 (1 7,440)
Opening Shareholders’ funds      53,551 70,991
Closing Shareholders’ funds      61,351 53,551
The notes on pages 69 to 79 form part of these Company financial statements.  
 
Company reconciliation of movements in shareholders’ funds  
for the 53 weeks ended 1 November 2009 Financial statements
71 Cosalt plc Annual report & financial statements 2009
Notes to the Company financial statements
32. Statement of accounting policies
The following paragraphs summarise the main accounting policies of the Company, which have been applied consistently  
in dealing with items which are considered material in relation to the Company’s financial statements.
Basis of preparation
The accounts have been prepared under the historical cost convention modified to include the revaluation of freehold and leasehold 
properties including investment properties at market value and in accordance with applicable accounting standards and the 
Companies Act 2006 except as stated below under ‘tangible fixed assets and depreciation’. As permitted by Section 408 of the 
Companies Act 2006 the profit and loss account of the Company is not presented.
Under FRS 1 the Company is exempt from the requirement to prepare a cash flow statement on the grounds that the Consolidated 
cash flows for all Group companies are included within the Consolidated financial statements.
As these Parent Company financial statements are presented together with the Consolidated financial statements, the Company 
has taken advantage of the exemption contained in FRS 8 and has therefore not disclosed transactions or balances with entities 
which form part of the Group (or investees of the Group qualifying as related parties). The Consolidated financial statements of 
Cosalt plc within which this Company is included are set out on pages 34 to 68.
Investments
Fixed asset investments are stated at cost less provision for impairment where appropriate. The Directors consider annually whether 
a provision against the value of investments on an individual basis is required. Such provisions are charged in the profit and loss 
account in the year.
Tangible fixed assets and depreciation
In accordance with Statement of Standard Accounting Practice No 19 Accounting for investment properties:
i)  investment properties are revalued annually at open market values (determined in accordance with the Guidance Notes on the 
valuation of assets issued by the Royal Institution of Chartered Surveyors). Surpluses and deficits arising and the aggregate 
surplus or deficit is transferred to the revaluation reserve except that any permanent diminution in the value of an investment 
property is taken to the profit and loss account for the year; and 
ii)  no depreciation or amortisation is provided in respect of freehold investment properties and leasehold investment properties 
with over 20 years to run. 
This treatment, as regards certain of the Company’s investment properties, may be a departure from the requirements of the 
Companies Act 1985 concerning depreciation of fixed assets. However, these properties are not held for consumption but for 
investment and the Directors consider that systematic annual depreciation would be inappropriate. The accounting policy adopted 
is therefore necessary for the accounts to give a true and fair view. Depreciation or amortisation is only one of the many factors 
reflected in the annual valuation and the amount which might otherwise have been shown cannot be separately identified or 
quantified.
Fixed assets are stated at cost, except that the Group has applied the provisions of FRS 15 and retained the book values of freehold 
and leasehold land and buildings which reflect the valuations up to August 2000. The valuations have not been updated since that 
date.
Tangible fixed assets, except freehold land and investment properties, are depreciated on a straight line basis at annual rates which 
vary depending on the type of asset but which are generally:
Freehold buildings    2%
Buildings on land leased from 
Associated British Ports on 
short-term tenancy agreements  2%
Other leasehold land and buildings  At rates based on life of lease
Plant and machinery   5%-20%
Motor vehicles    20%-25%
Assets subject to finance leases giving rights approximating to ownership are treated as though they have been purchased outright 
and are included in tangible fixed assets at a value equal to the present value of the minimum lease payments to be made during  
the term of the lease. The total amount of the future obligations is included in creditors. The amount included in tangible fixed assets 
is written off over the shorter of the useful life of the asset or the term of the lease.
 
Notes to the Company financial statements Financial statements
72 Cosalt plc Annual report & financial statements 2009
Notes to the Company financial statements
Notes to the Company financial statements
continued
32. Statement of accounting policies continued
The rental costs of all operating leases is charged to the profit and loss account or straight line basis over the lives of the leases.
Profit or loss arising on the sale of properties represents the difference between the net carrying amount and proceeds of sale.
Government grants
Capital grants received for additions to buildings and plant are taken to deferred income and are released to profit and loss account 
in instalments relating to the relevant asset lives.
Other grants are recognised in the profit and loss account in the same period as the related expenditure.
Deferred taxation 
The charge for taxation is based on the profit 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.
Pension costs
The Company participates in a Group wide pension scheme providing benefits based on final pensionable pay. The assets of the 
scheme are held separately from those of the Company. The Company is unable to identify its share of the underlying assets and 
liabilities of the scheme on a consistent and reasonable basis and therefore, as required by FRS 17 ‘Retirement benefits’, accounts 
for the scheme as if it were a defined contribution scheme. As a result, the amount charged to the profit and loss account  
represents the contributions payable to the scheme in respect of the accounting period.
For defined contribution schemes all contributions are charged directly to the profit and loss account in the periods in which they  
are payable.
Foreign currency
Transactions in foreign currencies are recorded using the rate of exchange ruling at the date of the transaction. The exchange 
difference arising on the translation of investments in foreign operations is taken to reserves to the extent that there is an effective 
hedge in place. Monetary assets and liabilities denominated in foreign currency are translated using the rate of exchange ruling  
at the balance sheet date and the gains or losses on translation are included in the profit and loss account.
Share-based payments
Equity settled share-based payments are measured at fair value (excluding the effect of non market based vesting conditions)  
at the date of grant. The fair value determined at the grant date of the equity settled share-based payments is expensed on  
a straight-line basis over the vesting period, based on the Company’s estimate of the shares that will eventually vest.
For share options where there are no market based vesting conditions, fair value is measured using the Black-Scholes pricing model.
Share capital 
(i) Share capital
Share capital is classified as equity if it is non-redeemable and any dividends are discretionary, or is redeemable but only at the 
Company’s option. Dividends on share capital are classified as a liability if it is redeemable on a specific date or at the option  
of the Shareholders or if dividend payments are not discretionary. Dividends thereon are recognised in the Consolidated income 
statement as a financial expense.
(ii) Dividends
Dividends on non-equity shares are recognised as a liability at the date and expensed on an accruals basis. Equity dividends  
are recognised as a liability in the period in which they are paid or approved by Shareholders and recorded directly in equity.
Financial guarantees
Where the Company enters into financial guarantee contracts to guarantee the indebtedness of other companies within the Group, 
the Company considers these to be insurance arrangements, and accounts for them as such. In this respect the Company treats  
the guarantee contracts as a contingent liability until payment under the guarantee becomes probable.
  Financial statements
73 Cosalt plc Annual report & financial statements 2009
Notes to the Company financial statements
33. Employees
      2009 2008
      £000 £000
Staff costs:  
Wages and salaries      1,642 841
Share-based payments      56 (28)
Social security costs       170 1 1
Other pension costs      65 500
      1,933 1,324
The average number of Employees of the Company during the year was:  
      2009 2008
      Number Number
Management and administration      10 9
Details of Directors’ remuneration, share options, long term incentive plans and Directors’ pension entitlements are disclosed  
in the Directors’ remuneration report on pages 26 to 28.
34. Dividends
     2009  2008
    per share £000 per share £000
2007 Final: paid 4 April 2008    – – 6.00p 884
2008 Interim: paid 10 September 2008    – – 6.00p 1,578
    – – 12.00p 2,462
35. Tangible fixed assets     
    Short Freehold  
   Freehold leasehold investment  
   properties properties properties Plant Total
   £000 £000 £000 £000 £000
Cost and valuation     
At 26 October 2008   1,645 1,009 3,100 123 5,877
Additions   56 – – – 56
Reclassification   (537) – 775 – 238
Revaluation   269 – (335) – (66)
Disposals   – – – (5) (5)
At 1 November 2009   1,433 1,009 3,540 118 6,100
Aggregate depreciation     
At 26 October 2008   659 441 – 73 1,173
Reclassification    (239) – –  – (239)
Amount charged to profit and loss account  38 18 – 18 74
On disposals   – – – (4) (4)
At 1 November 2009   458 459 – 87 1,004
Net book values     
At 1 November 2009   975 550 3,540 31 5,096
At 26 October 2008   986 568 3,100  50  4,704
     
(a) Short leaseholds are those with a term of under 50 years to run. Plant includes vehicles. 
(b) Company assets costing £144,000 (2008: £144,000) have been fully depreciated and are still in use. 
(c) On the adoption of FRS 15 in August 2000 the book value of land and buildings has been retained at the valuation at this date. 
  Financial statements
74 Cosalt plc Annual report & financial statements 2009
Notes to the Company financial statements
Notes to the Company financial statements
continued
35. Tangible fixed assets continued     
The following tangible fixed assets held under finance leases are included in plant:
      2009 2008
      £000 £000
Cost      41 41
Depreciation      (9) (3)
Net book values      32 38
If land and buildings had not been re-valued subsequent to 1978, they would have been included at the following amounts:
      2009 2008
      £000 £000
At valuation or cost at 31 December 1978      1,984 1,984
Subsequent additions at cost      2,803 2,747
At 27 August 2000      4,787 4,731
Accumulated depreciation      852 798
      3,935 3,933
The Group also valued its land and buildings in 1971, 1973 and 1978. In the opinion of the Directors unreasonable expense and  
delay would be incurred in obtaining the original cost of the assets valued in those years.
The depreciable amount of trading properties is:
       Short
      Freehold leasehold
      £000 £000
1 November 2009      1,419 909
26 October 2008      1,584 909
Future capital expenditure  
      2009 2008
      £000 £000
Contracted for but not provided for in the accounts     – -
    
Investment properties
The Company holds investment properties with a fair value of £3,540,000 as at 1 November 2009. The properties were revalued by  
a suitably qualified independent value at market value and in accordance with the Royal Institution of Chartered Surveyors (RICS) 
Appraisal and Valuation Standards (5th edition). Following the revaluation a loss of £335,000 has been recognised in the period  
to 1 November 2009 (period to 26 October 2008: loss £800,000).
During the period the Group vacated a freehold property and this has transferred to investment properties at £775,000. The  
increase in value of £614,000 from its net book value has been recognised in revaluation above. Future changes in valuation will  
be recognised through investment property revaluation.
  Financial statements
75 Cosalt plc Annual report & financial statements 2009
Notes to the Company financial statements
36. Investments
      2009 2008
      £000 £000
Shares in subsidiary undertakings at cost      66,272 65,456
Less amounts written off      10,003 3,772
Investment in shares of subsidiary undertakings     56,269 61,684
Other investments      350 2,728
      56,619 64,412
The movement in costs and amounts written off are as follows:  
      2009 2008
      £000 £000
At 26 October 2008      65,456 52,849
Additions      816 32,889
Disposals      – (20,282)
At 1 November 2009      66,272 65,456
Amounts written off  
At 26 October 2008      3,772 3,772
Charge to profit and loss account       6,231 –
At 1 November 2009      10,003 3,772
Net book value      56,269 61,684
Capital contributions of £816,000 were made to existing subsidiaries during the year.
Details of the principal subsidiary undertakings, including those acquired during the year, are shown in the Group activities note 20.
37. Debtors: amounts falling due within one year
      2009 2008
      £000 £000
Trade debtors      46 45
Amounts due from subsidiary undertakings less provisions    33,743 35,739
Corporation tax      2,278 –
Other taxation recoverable      295 176
Other debtors      215 82
Prepayments and accrued income      109 194
      36,686 36,236
38. Creditors: amounts falling due within one year  
      2009 2008
      £000 £000
Loans other than from banks      557 557
Bank loans and overdrafts      5,143 5,616
      5,700 6,1 73
Trade creditors      709 260
Amounts owed to subsidiary undertakings      2,678 6,940
Corporation tax      – 500
Other taxation payable      207 –
Social security      224 524
Other creditors      3,612 4,612
Accruals and deferred income      2,325 5,260
Obligations under finance leases (note 45)      16 20
      15,471 24,289
  Financial statements
76 Cosalt plc Annual report & financial statements 2009
Notes to the Company financial statements
Notes to the Company financial statements
continued
39. Creditors: amounts falling due after more than one year
      2009 2008
      £000 £000
Bank loans      19,812 26,917
Preference shares      50 50
Obligations under finance leases (note 45)      – 16
      19,862 26,983
7.50% Cumulative Preference Shareholders (non-equity interests) have the following rights:  
(i) in priority to ordinary Shareholders, to a fixed cumulative preference dividend at a rate of 7.50% per annum; 
(ii)  on a return of capital on a winding up, will carry the right to repayment of capital together with a sum equal to any arrears  
of dividend in priority to the rights of ordinary Shareholders; 
(iii)  to attend and vote at a general meeting of the Company only in certain limited circumstances where the special rights attaching 
to these shares might be varied or their interest affected. 
      2009 2008
      £000 £000
Analysis of gross borrowings       
Loans repayable within 5 years:       
Unsecured loans       
Undated debenture held by a subsidiary undertaking, interest at 12% deferred   557 557
2008/2011 term loan      – 1 1, 100
2009/2012 at 3.75% above bank base rate      5,100 –
      5,657 11,657
Total loans      5,657 11,657
Bank overdrafts/revolving credit facility      19,855 21,433
Total gross borrowings      25,512 33,090
Repayment of gross borrowings       
Bank borrowings       
Between two and five years      13,855 26,033
Between one and two years      7,600 3,500
Within one year or on demand      3,500 3,000
Gross bank borrowings      24,955 32,533
Other loans       
Between two and five years      – –
Between one and two years      – –
Within one year or on demand      557 557
Gross other borrowings      557 557
Total gross borrowings      25,512 33,090
Net borrowings      
Gross borrowings      25,512 33,090
Cash at bank and in hand      – –
      25,512 33,090 Financial statements
77 Cosalt plc Annual report & financial statements 2009
Notes to the Company financial statements
40. Derivative financial instruments       
   Assets  Liabilities  Net
  2009 2008 2009 2008 2009 2008
  £000 £000 £000 £000 £000 £000
Forward foreign currency contracts  35 622 – – 35 622
Interest rate cap and floor  – – (1,018) (381) (1,018) (381)
  35 622 (1,018) (381) (983) 241
The fair value of derivative financial instruments is equal to the carrying value. The fair value of forward foreign current contracts 
represents the gain or loss resulting from translation of those contracts at forward rates applicable at the balance sheet date 
compared to actual contract rates. The fair value of interest rate cap and floor contracts represent the market value of a comparable 
instrument at the balance sheet date.
41. Provisions for liabilities
       Deferred
       taxation
       £000
At 26 October 2008       763
Deferred taxation       (35)
At 1 November 2009       728
Analysis of deferred taxation:    
      2009 2008
      £000 £000
Accelerated capital allowances      188 353
Other timing differences      (132) (133)
Retirement benefit obligations      672 543
      728 763
42. Called up share capital    
     Authorised Issued and fully paid
    2009 2008 2009 2008
    £000 £000 £000 £000
7.50% Cumulative Preference Shares of £1 each   250 250 50 50
Ordinary Shares of 25p each    – 7,750 – 6,601
Treasury Shares    – (55) – (14)
Ordinary shares of 1p each    566,318 – 4,044 –
Treasury shares    (55) – (2) –
Deferred Ordinary shares of 24p each    48,000 – 6,337 –
Treasury shares    (55) – (43) –
    614,458 7,945 10,386 6,637
Shares classified as liabilities      50 50
Shares classified in Shareholders’ funds      10,336 6,587
      10,386 6,637
Details of the rights attached to the 7.50% Cumulative Preference share and the 24p deferred ordinary shares are shown in note 23 
on page 60. 78 Cosalt plc Annual report & financial statements 2009
Notes to the Company financial statements Company information
Notes to the Company financial statements
continued
43. Reserves
    Investment     
 Share   property    Profi t 
 premium Merger Revaluation revaluation Translation Hedging Other and loss 
 account reserve reserve reserve reserve reserve reserves account Total
 £000 £000 £000 £000 £000 £000 £000 £000 £000
At 26 Oct 08 34,558 7,586 618 455 (844) 241 814 3,536 46,964
Currency translation differences – – – – (736) – – – (736)
Derivative financial instruments – – – – – (1,224) – – (1,224)
Shares issued 13,556 – – – – – – – 13,556
Share option charge – – – – – – – 56 56
Revaluation uplift – – 614 (335) – – – – 279
Transfer to profit on disposal – – – – – – – – –
Loss for the financial year – – – – – – – (7,880) (7,880)
Dividends – – – – – – – – –
At 1 Nov 09 48,114 7,586 1,232 120 (1,580) (983) 814 (4,288) 51,015
Other reserves include Capital Redemption Reserve £814,000 (2008: £814,000).
Details of share-based payment arrangements are shown in the Group Share Capital note 23 on page 60.
 
44. Contingent liabilities
      2009 2008
      £000 £000
(a) Under guarantee of overdrafts and loans of subsidiary undertakings    – 21
(b) Deferred interest under a debenture held by a subsidiary undertaking   2,334 2,267
(c)  Cosalt plc has also guaranteed leasing and other arrangements   
of subsidiary undertakings in the ordinary course of business  
45. Leasing obligations  
(a) Future commitments due under finance leases are:  
      2009 2008
      £000 £000
Within one year      16 20
Between two and five years      – 16
      16 36
Less: future finance charges      – –
      16 36
Shown in creditors as:  
Amounts falling due within one year      16 20
Amounts falling due after more than one year     – 16
      16 36 Financial statements
79 Cosalt plc Annual report & financial statements 2009
Notes to the Company financial statements
(b) Annual commitments due under non-cancellable operating leases are:  
      2009 2008
      £000 £000
(i) Land and buildings:  
Leases which expire within one year      84 32
Between two and five years      170 543
In five years or more      – 16
      254 591
  
(ii) Plant:  
Leases which expire within one year      4 5
Between two and five years      8 5
      12 10
The majority of leases of land and buildings are subject to rent reviews.
46. Pension scheme
The Company is a member of the Group’s pension scheme, details of which are given in note 27.
It is not practical for the Company to identify its share of the scheme assets and liabilities on a consistent and reasonable basis. 
Accordingly as permitted by FRS 17, ‘Retirement benefits’, the Scheme has been accounted for in these Company financial 
statements as if the Scheme was a defined contribution scheme.
The latest full actuarial valuation was carried out as at December 2006 and was updated for FRS 17 purposes to 1 November 2009 
by a qualified independent actuary. Certain Employees are Members of a Company defined contribution scheme which invests 
funds in which the contributions for each individual member are separately identifiable and the benefits calculated accordingly. Financial statements
80 Cosalt plc Annual report & financial statements 2009
Company information
Company information
Financial calendar 
2010
1 January   Half-year’s dividend on 7.50% Cumulative 
Preference Shares
2 February Preliminary announcement of 2009 results
25 February Publication of Annual Report for 2009
24 March Annual General Meeting
Advisers 
Registered office
Fish Dock Road
Grimsby DN31 3NW
Auditors 
KPMG Audit Plc
Chartered Accountants
1 The Embankment
Neville Street
Leeds LS1 4DW
Joint bankers
Royal Bank of Scotland plc
6th Floor
Cumberland Place
Nottingham NG1 7ZS
HSBC Bank plc
2nd Floor, 4 Hardman Square
Spinningfields
Manchester M3 3EB
Corporate advisers
Noble Grossart Limited
48 Queen Street
Edinburgh EH2 3NR
Solicitors
Pinsent Masons 
1 Park Row
Leeds LS1 5AB
Wilkin Chapman
New Oxford House 
Town Hall Square
Grimsby DN31 1HE
Brokers
Evolution Securities Ltd
100 Wood Street
London EC2V 7AN
Registrars
Computershare Services plc*
PO Box 82 The Pavilions
Bridgwater Road
Bristol BS99 7NH
*  With effect from 29 March 2010  
the Company’s registrars will be:
 
Capita Registrars
Northern House
Woodsome Park
Fenay Bridge
Huddersfield HD8 0GA Acknowledgements
Cosalt would like to thank all those who participated in producing  
this report, particularly the members of staff for their contributions.
Main photography by Charlie Fawell 
Board photography Mike Ellis
Designed and produced by 
The College  www.thecollege.uk.com
Printed in the UK by Empress Litho
In 2009 Cosalt Compliance  
was successful in obtaining the 
ISO-14001 Environmental standard.
In 2009 the new Premier 2010 lifejacket 
aimed at the cruise and ferry market  
won a Safety at Sea innovation award.
ISO 14001
BUREAU VERITAS
Certification
Overview
Safety critical
 Overview
01 Strategic & operational highlights
02 At a glance
04 Chairman’s statement
 Business review
06 Chief Executive’s review
08 Financial review
10 Our responsibilities
12 Principal risks
14 Divisions: Offshore
18 Divisions: Marine
 Governance
22 Board of directors
24 Directors’ report
26 Remuneration report
29 Corporate governance
 Financial statements
33 Independent Auditors’ report
34 Consolidated income statement
35 Consolidated balance sheet
36  Consolidated statement of recognised 
income and expense
37 Consolidated cash flow statement
38 Notes to the financial statements
69 Company balance sheet
70  Company reconciliation of movements 
in shareholders’ funds
71  Notes to the Company financial 
statements
 Company information
80 Advisers and financial calendar
Cosalt’s objective is to become  
a leading provider of critical safety 
equipment and services for the 
highly regulated Offshore and 
Marine industries for people exposed 
to hostile work environments  Cosalt plc 
Annual report  
& financial statements 2009
Safety 
critical
Cosalt plc
Fish Dock Road
Grimsby
North East Lincolnshire 
DN31 3NW
Telephone 01472 504 504
Facsimile 01472 504 369
www.cosalt.com
Registered Number 19628
Cosalt plc Annual report & financial statements 2009