ANNUAL REPORT 2014
EKF Diagnostics Holdings plc ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc
EKF Diagnostics Holdings plc is a global, integrated 
medical diagnostics business. 
Our expertise extends across three core divisions: The design and manufacture 
of diagnostic equipment including analysers and rapid tests; the manufacture of 
enzymes and liquid reagents used in clinical chemistry; and molecular diagnostic 
test kits and a spectrum of molecular testing services.
The fusion of traditional laboratory testing products, modern Point-of-Care 
technology and next generation molecular testing products and services makes 
EKF Diagnostics unique in the ﬁ eld of small to mid-sized medtech businesses. 
Contents
1.0 Strategic Review
Financial and operational highlights 1
At a glance  2
Business Model 3
Organisational Structire 4
Chairman’s Statement  10
Chief Executive’s Review 12
Board of Directors 16
2.0 Governance
Strategic Report 18
Report of the Directors 21
Corporate Governance Statement 24
Report of the Remuneration Committee 26
Independent Auditors’ Report 27
3.0 Financial Statements
Consolidated Income Statement 29
Consolidated Statement of 
Comprehensive Income 30
Consolidated and Company’s 
Statements of Financial Position 31
Consolidated and Company’s 
Statements of Cash Flows 32
Consolidated and Company’s 
Statements of Changes in Equity 33
Notes to the Financial Statements 35
4.0 Additional Information
Notice of Annual General Meeting 70
Company Information 72 EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 1
£40.06 £19.95 £6.26
Turnover (£m) Adjusted EBITDA (£m) Gross proﬁ t (£m)
+26% +31% +22%
Financial and operational highlights
26% increase in revenues year-on-year with 
signiﬁ cant contributions from new acquisitions.
• Group revenues of £40.06m (up 26%)
• Organic growth of 6% year-on-year with
acquisitions contributing £6.5m
• 38% increase in revenues in the second half
of 2014 compared to 2013 (£23.3m v £16.9m)
• Gross proﬁ t up 22% to £19.9m
• Adjusted EBITDA up 31% to £6.3m
• Net cash of £2.1m (2013: £0.1m)
• Over 18,000 point-of-care analysers sold
• Almost 56m tests manufactured across the
diagnostic analyser portfolio
• Revenues from Hemo Control hemoglobin
analysers up by 23%
• Revenues from Quo-Lab HbA1c analysers up
by 69%
• Revenues of Beta-Hydroxybutyrate
Liquicolor reagent increased by 9%
2014 built on the achievements of 2013. The 
installed base of active point-of-care analysers 
is estimated to be more than 80,000 providing 
a consistent demand for tests. Clinical 
chemistry continues to be a competitive 
market and yet Beta-Hydroxybutyrate 
Liquicolor sales grew through a sustained 
focus in the USA.
Molecular diagnostics contributed revenues for 
the ﬁ rst time with Selah Genomics, acquired in 
April 2014, providing new revenue streams from 
a portfolio of molecular test services. EKF’s 
proprietary molecular testing platform, 
PointMan
™ 
also delivered revenues from the 
research-use-only market ahead of the planned 
release of CE marked products in 2015.
1.0 Strategic Review
Building momentum
Signiﬁ cant increase across all metrics of 
ﬁ nancial performance
£21.66
2011
£26.06
2012
£31.80
2013
£10.38
2011
£14.31
2012
£16.35
2013
£3.20
2012
£4.82
2013
£1.57
2011 ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 2
At a glance
The pace of change accelerated at the turn of 
the 21st Century when EKF-diagnostic made 
the strategic decision to focus on developing 
a range of glucose, lactate and hemoglobin 
analysers. 
When, in 2010, EKF-diagnostic was acquired by 
UK AIM-listed company IBL plc, the process 
of building a unique international IVD business 
began in earnest as Quotient Diagnostics Ltd in 
Walton-on-Thames and Dublin based 
Argutus Medical were bought. These 
acquisitions expanded EKF’s portfolio to 
include HbA1c analysers and kidney and liver 
biomarkers for use in pharmaceutical research.
In 2011 the business, by now known as EKF 
Diagnostics Holdings plc, bought Stanbio 
Laboratory, a clinical chemistry manufacturer 
and distributor of IVD analysers based near 
San Antonio, Texas. The company’s US 
presence was increased further in 2014 
through the purchase of Separation 
Technology Inc., Florida, a manufacturer of 
hematocrit analysers and laboratory 
centrifuges. This was followed by the purchase 
of DiaSpect Medical A.B. a Swedish owned, 
German based manufacturer of hematology 
products.
EKF Molecular Diagnostics was added to the 
company portfolio in March 2013 following the 
acquisition of 360 Genomics from Oxitec 
Limited and others. This ﬁ rst foray into 
molecular diagnostics was complemented in 
April 2014 with the purchase of Selah 
Genomics Inc, Greenville, South Carolina a 
laboratory specialising in molecular 
diagnostics for personalised medicine.
Company history
In the 25 years since EKF was founded it has grown from a humble electrical 
engineering company based in the hinterland of the east German city of 
Magdeburg into an international, stock market-listed medical technology 
business.
A global IVD business
EKF Diagnostics Holdings plc has a global presence with facilities in key 
markets around the world. 
1.0 Strategic Review
Elkhart
Greenville
Sanford
San Antonio
Cardiff
Magdeburg Moscow
Shanghai
Leipzig
Sailauf
Krakow
London
Company Headquarters
Manufacturing
Research & Development
 Molecular Laboratory Services   EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 3
1.0 Strategic Review Business model
In April DiaSpect Medical AB was acquired. 
DiaSpect is a leading brand within reagent-free 
hemoglobin screening and owns a unique 
technology that allows EKF to compete 
head-to-head with the market leader.
The purchase of Selah Genomics, a clinical 
diagnostic company focused on enabling 
This increase was in part attributable to winning 
new contracts in China through its Biosen 
glucose platform, and in Mexico where both the 
hemoglobin and glycated hemoglobin (HbA1c) 
analyser platforms performed well. 
EKF’s Central Laboratory division launched 
several new products in 2014 including 
Procalcitonin (PCT), a marker used in
diagnosing and monitoring sepsis, and 
Glycated Serum Protein (GSP) an indicator of 
diabetic health.
personalised medicine, provides EKF with an 
increased presence in the growing molecular 
diagnostics market. Selah specialises in the 
detection of molecular biomarkers to diagnose 
and monitor disease, detect risk, and identify 
which therapies will work best for individual 
patients.
Meanwhile within EKF’s clinical chemistry range 
sales of Beta-Hydroxybutyrate, a biomarker 
used to detect the presence of ketones in 
blood, rose 7% year on year. This performance 
was particularly impressive given the 
competitive nature of the ketone testing 
market.
EKF Molecular Diagnostics’ focus in 2014 was 
on CE marking its PointMan test kits, with ﬁ rst 
releases expected by Q2 2015.
Acquisition
In 2014 EKF Diagnostics Holdings plc purchased three businesses. In March 
Separation Technology Inc. (STI) was acquired from Thermo Fisher Scientiﬁ c 
Inc. STI manufactures hematology analysers and laboratory centrifuges with the 
majority of its sales coming from the US blood banking sector. 
Organic growth
Although 2014 was a year in which acquisitions provided signiﬁ cant new 
revenues to EKF Diagnostics Holdings plc, the underlying business saw solid 
growth of 6%. 
New product development
Signiﬁ cant investment was made throughout the year in preparing the ground 
for new point-of-care product releases. 2015 will see the launch of new 
versions of Hemo Control and Biosen as well as a new lactate platform, 
SensPoint, which is aimed at providing the company with a presence in the 
maternal medicine market. 
2011 2013 2014
Acquisition timeline
2010
 EKF-diagnostic GmbH Stanbio Laboratory 360 Genomics Ltd Separation Technology Inc. 
 Quotient Diagnostics Ltd   DiaSpect Medical AB
 Argutus Medical Ltd   Selah Genomics Inc. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 4
EKF Diagnostics’ expertise extends across three distinct branches of the 
in-vitro diagnostics sector. Each of the branches plays an important role in 
shaping the direction of the company today and in the future.
1.0 Strategic Review
Following the acquisition of Selah 
Genomics in April 2014 EKF’s presence 
in the molecular diagnostics market 
encompasses both products 
(PointMan) and testing services (Selah). 
EKF’s vision is to create a single entity 
for molecular diagnostics by combining 
these acquisitions into a holistic 
molecular division.
EKF’s Central Laboratory division 
comprises of clinical chemistry (also 
known as chemical pathology, clinical 
biochemistry or medical biochemistry), 
blood analysers and a range of 
centrifuges. 
Unlike POCT central laboratory testing 
is a mature market (CAGR 2007-2012 
was 2%) with established suppliers 
competing for business throughout 
the world. 
Central 
Laboratory
Following the acquisitions made in 2014 
EKF estimates that there are more than 
80,000 EKF analysers in use today on 
a regular basis in doctor’s ofﬁ ces, blood 
banks, laboratories and clinics. This 
installed base of devices provides the 
bedrock for the company’s future 
revenue projections. 
The Point-of-Care division is made up 
of three key markets:
• Hematology
• Diabetes Care
• Maternal & Women’s Health
Point-of-Care Molecular 
Diagnostics
Hematology
Diabetes 
Care
Maternal and
Women’ s Health
Central
Laboratory
Life
Sciences
Research
Biomarkers
Selah
GENOMICS
Organisational structure EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 5
1.0 Strategic Review
Product portfolio
The Hematology business unit within EKF is the largest in terms of revenues 
and the size of the installed base. The addition of DiaSpect and Separation 
Technology’s products to the portfolio means that EKF now offers the largest 
selection of point-of-care hemoglobin analysers on the market.
Point-of-Care: Hematology
Hemo Control  
Uses ‘gold standard’ 
methodology 
(reagent ﬁ lled 
microcuvettes)
Data management 
capability
Provides a hematocrit 
calculation
Proven, robust 
analyser sold 
worldwide
Manufactured in
Magdeburg, Germany
EKF has two distinct strategies – OEM 
partnerships with international distributor/
manufacturers such as Alere and Fresenius 
Kabi and agreements with smaller distributors 
who are focused on the public health 
opportunities within their own countries.
The addition of the DiaSpect and UltraCrit 
models gives EKF an extended portfolio to 
offer to both market segments, as well as 
address niche markets such as veterinary and 
sports medicine. EKF believes that this 
portfolio can provide it with a competitive 
advantage to grow its market share in 2015 
and beyond.
Strategy
The opportunities for the Hematology business unit are primarily focused around 
two markets – public health initiatives such as anemia screening programmes and 
private practices where the cost of testing is paid for by an insurance 
company or the patient. 
DiaSpect Tm  
Handheld analyser 
utilising reagentless 
methodology
Beneﬁ ts of speed 
to result (1 second), 
shelf-life of 
microcuvettes  
Successor to 
DiaSpect 
Hemoglobin T
Manufactured in
Sailauf, Germany
UltraCrit™
Hematocrit analyser 
using unique 
ultrasound 
technology
Strong presence in 
US blood banking 
sector
International version 
also provides 
hemoglobin 
calculation
Manufactured in
Sanford, USA
HemataSTAT
®
 
Hematacrit 
centrifuge and 
analyser used in 
laboratories
Processes multiple 
samples
Manufactured in
Sanford, USA ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 6
Point-of-Care: Diabetes Care 1.0 Strategic Review
Product portfolio
Diabetes has been at the core of EKF’s strategy for well over 10 years starting 
with the early models of what became Biosen C-Line and Biosen S-Line. More 
recently HbA1c analysers have been developed and launched that address the 
diabetes screening market. And, although they do not strictly belong within a 
point-of-care framework, clinical chemistry tests such as Glycated Serum 
Protein and Beta-Hydroxybutyrate add further provenance to EKF’s claim to 
be a signiﬁ cant contributor to diabetes care worldwide.
Despite being a relatively mature product in 
the company’s range, Biosen’s reputation for 
accuracy and reliability saw a signiﬁ cant 
increase in demand in 2014. Unit sales of 
analysers grew by 9% year on year and this 
demand is expected to continue into 2015 
following an agreement with a Chinese 
distributor that will see 1,900 analysers 
shipped between 2014 and the end of 2016. 
2014 saw a major operational change within 
the Diabetes Care business unit as 
manufacturing of Quo-Test and Quo-Lab was 
transferred to EKF’s Magdeburg site. This 
change has allowed the company to make 
signiﬁ cant operational savings as well as 
centralise the majority of its European-made 
analysers and tests.
Strategy
Although glucose testing is the most commonly used method of determining 
glycaemic control within diabetics, HbA1c is the accepted long term barometer of 
patient wellbeing and their compliance with their treatment regimes. The growth 
in popularity of HbA1c measurement has seen an increasing number of entrants 
to the point-of-care HbA1c market focused on GP surgeries and diabetes clinics. 
Despite this revenues from Quo-Lab increased by 69% in 2014 as EKF grew the 
distribution network and registered the product in new markets.
Biosen
Glucose and/or 
lactate measurement
Three models, each 
aimed at different 
settings
Used as the 
benchmark for blood 
glucose monitors in 
China
Manufactured in
Magdeburg, Germany
Quo-Lab A1c
HbA1c testing 
(glycated 
hemoglobin)
Results in four 
minutes using a 
unique methodology
Targeted at 
developing world 
markets
Manufactured in
Magdeburg, Germany
Quo-Test A1c 
HbA1c testing 
(glycated 
hemoglobin)
Same methodology 
as Quo-Lab but fully 
automated
Simple operation 
requires minimal 
training
Manufactured in
Magdeburg, Germany EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 7
1.0 Strategic Review Point-of-Care: Maternal & Women’s Health
Product portfolio
Maternal and Women’s Health focuses primarily on diagnostics used to 
address conditions and complications associated with pregnancy and child 
birth. Sales within this business unit include revenues from creamatocrit 
centrifuges and hemoglobin meters used in Women and Infant Clinics, 
pregnancy test kits and HbA1c analysers used to diagnose gestational diabetes 
in pregnant women.
EKF is aware of strong commercial interest 
in this market as a result of a distributor in 
France starting to develop the market using 
Lactate Scout+. Lactate Scout+ uses the same 
strip system as SensPoint but was developed 
primarily for use in sports science. 
However the main focus of this new division is 
to develop the use of lactate within obstetric 
medicine. Over the past two years EKF’s R&D 
team in Germany have been developing one 
of the company’s existing platforms to provide 
accurate lactate readings taken during labour 
With the global trend for elective C-Sections, 
many of which are an unnecessary expense, as 
well as the global imperative to improve 
mother and child welfare, EKF is uniquely 
placed to take the lead in a developing market. 
as a method of determining whether 
intervention is needed in the form of a 
caesarean section. This novel approach will be 
launched in 2015 alongside a set of guidelines 
issued by a European panel of experts.
Strategy
EKF’s Maternal and Women’s Health business unit is very much in its infancy. The 
current focus is on distributor engagement and education and on developing a 
protocol with high level opinion leaders for the use of lactate in obstetric medicine.  
SensPoint
Handheld lactate 
analyser with 
docking station
Strip sensor 
technology
Results in 10 seconds
Developed for use in
maternity wards
Manufactured in
Magdeburg, Germany
Creamatocrit 
Plus
Small lab centrifuge 
Measures the lipid 
concentration and 
caloric density of 
breast milk
Allows professionals 
to guide mothers 
with underweight 
infants 
Manufactured in
Sanford, USA
Pregnancy kits
Cassette rapid tests
Marketed for use in 
hospital settings
Distributed from 
San Antonio, USA ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 8
Central Laboratory 1.0 Strategic Review
Product portfolio
EKF, through its wholly owned subsidiary Stanbio Laboratory, has had a 
presence within central laboratory sales dating back over 50 years. During this 
time it has built a global customer base for its clinical chemistry reagents that 
can be used on most open-channel analyser platforms.
Beta-Hydroxybutyrate Liquicolor reagent is an 
excellent example of how EKF has changed 
the way in which central labs test for ketosis. 
Almost 1,000 US hospitals now use EKF’s ß-HB 
reagent instead of traditional nitroprusside 
The Central Laboratory business unit also 
includes the manufacture of enzymes, 
manufactured at EKF Life Sciences in Elkhart, 
Indiana. From this facility EKF Life Sciences sells 
enzymes used in Stanbio’s clinical chemistry 
portfolio as well as providing contract 
manufacturing services for third parties.
testing following a concerted sales campaign 
focusing on the patient and practitioner 
beneﬁ ts. A similar approach is planned for 
EKF’s new reagent products Procalcitonin 
(PCT) and Glycated Serum Protein (GSP).
The acquisition of Separation Technology Inc. 
provided EKF with a third element to its 
central laboratory offering. As well as being a 
manufacturer of hematology products, STI has 
a heritage in manufacturing high quality, 
US-built, mini-centrifuges. 
Strategy
The central laboratory market is experiencing relatively small levels of growth 
compared to point-of-care and molecular diagnostics. This is because it is a 
mature market that is dominated by large corporations. However opportunities 
do exist where niche markets can be addressed with high quality products that 
either create a new market or switch Laboratory Managers away from traditional 
testing methods.
Beta-
Hydroxybutyrate  
Automated reagent 
for the early 
detection of ketosis
Primarily sold in USA 
through distribution 
network
Glycated Serum 
Protein
2-3 week indicator 
of average blood 
glucose
Complementary to 
HbA1c in diagnosis and 
screening of diabetes
Micro12
High performance 
centrifuge
Used for molecular, 
clinical, cell and 
bacteriology use
PlasmaPrep-12
Plasma and serum 
separation
Programmable, multi 
sample centrifuge EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 9
1.0 Strategic Review Molecular Diagnostics
Product portfolio
EKF Molecular Diagnostics was established in March 2013 following the 
acquisition of 360 Genomics Limited. Since then EKF Molecular has launched 
seven PointMan
™
 test kits aimed at the Research Use Only (RUO) and 
companion diagnostics markets.
PointMan
™
 is a highly speciﬁ c and sensitive 
technology that enhances genetic detection 
processes. This capability is vital for companion 
diagnostics particularly in oncology. EKF is 
currently engaged with a number of 
collaborators, including the world-renowned 
cancer centre at Massachusetts General 
Hospital, to demonstrate the utility of the 
technology in detecting circulating tumour cells 
amd circulating free DNA. 
The second element within EKF’s molecular 
portfolio is Selah Genomics. Selah, based in 
South Carolina, USA was acquired in April 2014 
as part of EKF’s strategy to expand its footprint 
in the sector. Selah offers a range of molecular 
testing services to private practices throughout 
the USA, and is also involved in several 
collaborations with hospital groups and 
medtech conglomerates to commercialise new 
predictive testing models for cancer treatments.
The cornerstone of the company’s molecular 
strategy will be the completion and publication 
of studies and evaluations that demonstrate 
the utility of its portfolio. Many high level 
collaborations are already in place, some of 
which have attracted sponsorship from 
businesses looking to commercialise the 
technologies upon the successful completion 
of the evaluations. EKF expects the 
developments from PointMan
™
, PrecisionPath
™
 
and sTNFR1 to attract considerable interest in 
the next twelve months.
Strategy
Molecular diagnostics has begun to gain signiﬁ cant traction in the US where 
several laboratories specialising in molecular testing services have recently been 
acquired by international IVD businesses. 
EKF’s focus in 2015 will be to expand the Selah range of test panels and also 
integrate PointMan
™
 into Selah’s offering. 
PointMan
™
Highly sensitive 
technology that 
enables detection of 
mutant cells
Seven kits available, 
all within oncology
CE marking of ﬁ rst 
kits in 2015
PrecisionPath
™
Oncology panel of 
tests from Selah 
Genomics
Collaborations 
ongoing to develop 
predictive model for 
colon cancer
sTNFR1
Companion 
diagnostic biomarker 
Predictor of End 
Stage Renal Disease 
in diabetic patients ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 10
Chairman’s Statement
Dear Fellow Shareholder
The year past has been a curate’s egg of a year for the Company. There have 
been many positive factors as we have continued to grow both organically 
and by acquisition but they have been offset by certain events largely 
beyond our control.
1.0 Strategic Review
Strategy
From a strategic perspective we believe we 
needed to achieve three key objectives in 
2014.
The ﬁ rst was to underpin our current point of 
care offering particularly in hemoglobin testing 
where our existing hemoglobin technology, 
widely regarded as the Rolls-Royce of 
instruments, was being threatened by newer 
technologies. It was against that background 
that we acquired DiaSpect Medical AB last 
April for an upfront cash and equity 
consideration of £16m with an earnout of up to 
£4.75m, which was subsequently settled by a 
cash payment of £1.425m in January 2015.
We believe that the DiaSpect product suite 
allows us to compete more effectively against 
our principal competitor. I believe the beneﬁ t 
of this acquisition will be more fully evidenced 
during 2015.
Secondly, we recognised that we needed to 
embolden our presence in molecular
diagnostics. In an ideal world this would have 
been in Point-of-Care, but given the plethora 
of technologies in development together with 
some launched products, not only would we 
have been playing catch-up with a me-too 
offering, but the scale of investment was not 
within our investment capacity. 
It was the Board’s view that a different 
approach was necessary and one which 
sought to build upon the Company’s toe-hold 
in molecular diagnostics through its 
previous acquisition of 360 Genomics Ltd and 
the PointMan™ technology.
We sought to do this through the acquisition 
of Selah Genomics Inc primarily for two 
reasons; one tactical and the other strategic.
Tactically the DME (Drug Metabolising 
Enzymes) testing was growing and set to grow 
further and we believed that it would help 
underpin our short to medium term growth 
ambitions. Strategically, we believed, and still 
do more than ever, that the true value will 
be evidenced by the work being undertaken 
at our facility in Greenville which we believe 
is at the forefront of molecular diagnostic 
testing in the ﬁ eld of personalised medicine 
via next-generation sequencing (NGS) testing 
using both internally developed tests and 
leveraging externally developed tests.
It was unfortunate that within a very short 
period of time after the acquisition the local US 
Medicare Administrative Contractor (‘MAC’) 
withdrew reimbursement for the DME panel. 
We have sought during 2014 to resolve this 
issue. We have explored a number of avenues 
and the effort that has been expended has 
been at the expense of other opportunities. 
We have come to the conclusion this month 
that the opportunity cost to us in pursuing 
DME revenues through the current channels 
and without the support of the MAC is too high 
when compared to the more signiﬁ cant and 
credible upside from PrecisionPath, which 
provides a panel of clinically validated 
biomarkers that can be used to design speciﬁ c 
personalised treatment plans for cancer 
patients.
It is beholden upon me to address the key 
issue of reimbursement at point of 
acquisition. Whilst the risk to reimbursement 
was recognised in due diligence, neither 
ourselves nor the incumbent management 
perceived the threat to be an immediate one. 
Given the nature of reimbursement in the USA 
had we been located in another state such as 
New Hampshire or Connecticut then the ability 
to have continued in the execution of our plan 
would have gone ahead unfettered. However, 
feeling sorry for oneself is likely to elicit zero 
sympathy and we believe a more realistic way 
forward is to work with the MAC in South 
Carolina to provide to their standard the 
necessary clinical evidence to support the use 
of a DME panel in anticipation of
reimbursement becoming available again at 
some stage in the future.
Thirdly, whilst not based on our experience 
with DME it is clearly evident to those in the 
industry that health payers worldwide cannot 
continue to pay for the ever burgeoning 
number of new diagnostic tests and 
therapeutics unless clear health economic 
beneﬁ ts can be demonstrated not in 
subjective terms, but in hard cash terms. It 
was against that strategic backdrop that we 
have taken a minority position in the Toronto 
based DxEconomix whose prime objective is 
to obtain value based pricing for IVD products 
for its clients. Progress has been slower than I 
had originally anticipated in that whilst many 
organisations recognise the need they are not 
yet fully prepared to pay for it.
Results overview
The Group has seen strong growth during the 
year with revenue of £40.1m (2013: £31.8m), an 
increase of 26%. This is despite the impact of 
a weak dollar and the well publicised issues in 
Russia, which include a very signiﬁ cant
currency deterioration. Revenues would have 
been higher by £2.6m had they been
translated at 2013 rates. Within this, organic 
growth was 6%.
Adjusted earnings before interest, tax, 
depreciation, and amortisation (AEBITDA),  EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 11
1.0 Strategic Review
which excludes share-based payments and 
exceptional items, is our preferred 
measurement of income, and is up 31% to 
£6.3m (2013: £4.8m). 
Board
During the year Gordon Hall retired as a 
Director having been on the EKF Board since 
2005. Having known Gordon for over twenty 
years I would like to thank him for his support 
both for the Company and for me personally 
and I wish him well for the future.
Subsequent to Gordon’s departure we 
strengthened the Board’s Non-Executive 
contingent through the appointment of 
Doris-Ann Williams and David Toohey, both of 
whom have immense industry knowledge and 
experience. Their contribution to the Board 
since joining has been invaluable.
The Board’s Executive contingent was 
strengthened through ﬁ rstly the appointment 
of Paul Foulger as Chief Financial Ofﬁ cer – Paul 
has been with us from the start and it was a 
natural progression for Paul to make. Secondly, 
Tito Bacarese-Hamilton was appointed Chief 
Technology Ofﬁ cer. In the coming year a 
considerable burden rests on Tito’s shoulders 
as we seek to launch a number of new 
products.
Regarding the passing of my baton, that will 
be done when the time is right, we must 
absolutely deliver on our expectations this 
year and restore the conﬁ dence in our 
shareholders for the team of which I am part. 
The pursuit of a signiﬁ cantly more expansionist 
strategy under different chairmanship cannot 
be contemplated until that conﬁ dence is 
restored and the share price responds 
accordingly.
Restructuring
During the year we moved our Quo-Test and 
Quo-Lab manufacturing to Barleben and 
closed our Dublin facility.
In 2015 we have reﬁ ned our existing divisional 
structure of Point-of-Care and Molecular.
Julian Baines, whilst retaining overall Group 
CEO responsibilities, has been tasked with the 
day-to-day running of the Molecular Division 
with a primary focus of providing diagnostic 
tests directed at therapeutic intervention and 
monitoring.
Richard Evans will assume day-to-day 
responsibility for the whole of our Point of 
Care Division with that division being split into 
four main Business Units of Hemoglobin, 
Diabetes, Maternal & Women’s Health, and 
Central Laboratory.
We believe this focus will bring beneﬁ ts during 
2015 and that the latent value in our molecular 
diagnostics offering will be realised.
Outlook
As we move into 2015 the overall outlook 
is positive despite some headwinds; Russia 
where revenues this year are likely to be no 
more than 30% of last year’s due to the 
continued impact of sanctions; and, the 
continued downward pressure on 
reimbursement globally.
Despite the above and an industry which is 
experiencing overall growth rates of 5% our 
ambitions remain to achieve double digit 
growth and to be able to exploit the 
opportunities in front of us.
We are under no illusion that we must 
deliver on sensible expectations and that as 
we continue to seek to grow we must do this 
in a non-dilutory fashion. As with all my years 
with the Company the results are back-end 
weighted and 2015 appears to be no exception 
to this.
We will continue to review the frequent 
approaches from private equity groups as to 
whether this is to the beneﬁ t of Shareholders 
but thus far none of the approaches represent 
anything more than opportunism.
The key deliverables for 2015 are set out below.
Point-of-Care
• Further develop the hemoglobin business   
 across the whole spectrum of hemoglobin   
 applications and markets using connected   
 solutions to open new markets in monitoring 
• Use EKF’s expertise to establish lactate
 measurement in peri-natal settings as a   
 marker of maternal and neonatal well-being
• Continue to build on EKF’s experience in
 very accurate glucose measurement by   
 introducing the Biosen instrument to new 
 markets, particularly in Asia and Latin 
 America
• Incorporate connectivity and data 
 management in all our major revenue
 generating product lines
• Development of the ﬁ rst ever POC 
 monitoring system for patients with 
 Phenylketonuria (PKU)
Molecular Diagnostics
• CE Marking for PointMan™ T790M assay
• Reimbursement for PrecisionPath™ 
• Complete the development of PrecisionPath  
 Discovery
• Launching the initial tests for the Oncomine   
 programme through PrecisionPath Discovery
• Launch the Ferrer Incode products into 
 Private Payer and Corporate Wellness 
 markets
• Transfer the manufacture of PointMan™ into   
 Selah
• Achieve ISO 13485 in the Selah facility
• Progress the colon cancer programme with   
 Becton Dickinson, DecisionQ and Greenville   
 Health System
• Deliver more pharma partnerships
I am buoyed by the opportunities in front of us 
and in particular the opportunities presented by 
PrecisionPath™ .
David Evans
Executive Chairman
16 March 2015 ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 12
Chief Executive’s Review 1.0 Strategic Review
During 2014 we made progress as we saw the organic growth of the core 
business continue to be above the global industry average. Additionally, we 
made three strategic acquisitions and although at times challenging, these 
acquisitions have been quickly integrated and have given us signiﬁ cant growth 
opportunities over the next three years. Year-on-year we have seen continuous 
improvement in both revenue and AEBITDA despite the decrease in healthcare 
spending worldwide, reduction in re-imbursement, tighter regulatory controls 
and the instability in Russia and the Middle East.
We now have a ﬁ rm footing in the global Point 
of Care market with over 80,000 instruments 
installed globally. We have seen a large 
increase in the sales of our Quo-Lab and Hemo 
Control instruments. We are also making 
progress with our Molecular Diagnostics 
division with the signing of contracts with 
Massachusetts General Hospital, Gilupi and 
Angle, supporting our belief that our 
PointMan™ product will become key to some 
major new technologies, especially in the 
detection of circulating tumour cells in whole 
blood. In addition Selah has given us a valuable 
platform and relationships that will enable us 
to deliver signiﬁ cant opportunities in the 
United States and beyond in 2015.
EKF Group has a lot to deliver in 2015 but 
those deliverables are clear and deﬁ ned as we 
have laid the base foundations in key areas to 
deliver growth above the industry average.
Operations
Structural change
During the year we have continued to initiate a 
number of signiﬁ cant structural changes to the 
business with the aim of improving efﬁ ciency, 
reducing cost, and driving revenue. With 
minimal disruption we successfully transferred 
the manufacture of the Quo-Test and Quo-Lab 
product lines, including both instruments and 
cartridges, into our main European production 
base in Barleben, Germany. This involved the 
commissioning of a new Quo-Lab cartridge 
production line which was designed and built 
by EKF’s in house production engineering 
team and which has reduced the cost of 
manufacture signiﬁ cantly. Having the 
ability to transfer production and build our 
own automated production lines is very rare 
and valuable to EKF. 
Our facility in Ireland has been closed 
following the termination of the building lease. 
While a small core project management team 
will remain in place, the majority of 
development projects, and the manufacture of 
the biomarker products have been transferred 
to the Walton-on-Thames site.
With the successful transfer of production of 
Quo-Test and Quo-Lab instruments and 
reagents cartridges to the Barleben 
manufacturing site and the closure of the 
Dublin site, the Company expects to 
beneﬁ t from operational savings in the region 
of £0.75m annually. In addition, work has now 
begun on expanding the Barleben site which 
will provide increased production capacity. 
As production levels rise, the Company 
expects this to have an additional positive 
impact on product margins, as well as creating 
further overhead efﬁ ciency opportunities. The 
Company will also continue to integrate the 
acquisitions made in 2014 and to exploit 
cross-selling initiatives and cost efﬁ ciency 
opportunities. 
We have recently enhanced and expanded our 
regional structure, including in China where we 
are about to open a representative ofﬁ ce in 
Shanghai. At the same time we have improved 
our distributor support, introducing a Premier 
Partner Programme, held our ﬁ rst international 
distributor meeting, and intend to employ a 
dedicated distribution chain manager.
The strengthening of the Sales and Marketing 
Infrastructure by bringing in experienced 
Business Unit Directors from major 
diagnostic organisations demonstrates that 
EKF is developing a global presence in the 
diagnostic industry and investment in this area 
will be key to continued growth.
Acquisitions
The three acquisitions made in the ﬁ rst half 
of the year have expanded our product line 
capabilities in hematology and molecular 
diagnostics.
Separation Technology, Inc. (STI) brings a 
successful line of centrifugal separation 
products all of which are FDA 510(k) 
approved. Additionally, it brings Ultracrit, an 
ultrasound based hematology analyser which 
is being used in a number of major US blood 
banks. STI has been successfully integrated 
and has shown continued growth in the US 
market through the expanded sales coverage 
via our US sales team.
DiaSpect Medical has designed a hematology 
instrument which is available in both desktop 
and handheld formats. Both formats use 
DiaSpect’s patented reagentless cuvette 
technology, which allows cheaper
manufacture, longer shelf life and results in 
under two seconds, which is particularly useful 
in blood banks where time to result is critical. 
The DiaSpect range is sold into blood banks 
via our partnership with Fresenius, the world’s 
leading supplier of blood bank products. We 
announced on 5 January 2015 that the 
Company agreed to make a cash payment 
of £1.425m as ﬁ nal settlement for the total 
deferred cash consideration due. The original 
maximum deferred consideration totalled 
£4.75m. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 13
1.0 Strategic Review
Selah Genomics, Inc. is a US CLIA certiﬁ ed 
supplier of panels of molecular diagnostic tests 
to patients who are referred by general 
practitioners or by corporate health teams 
in the USA. Funding is usually either through 
Medicare or private health insurers. The 
company provides EKF with signiﬁ cant 
opportunities through their relationships with 
major partners (Becton Dickenson, Greenville 
Health System, DecisionQ) as well as a high 
quality product range (PrecisionPath, 
PrecisionPath Discovery and the Ferrer InCode 
products). Delivery will be the main focus for 
the molecular diagnostics business in 2015.
Point-of-Care
During 2014 we focused on improving our 
distribution channels into major markets. 
Whilst we still have some way to go we have 
had success in introducing Human, Arkray, 
Fresenius, Alere Japan, and Multiclone as 
distributors, therefore strengthening our 
global sales capabilities. The current year will 
be focused on delivery. We have a strong mix 
of mature and new products and with the 
strengthening of the commercial team we will 
aim to continue to grow at a higher rate than 
the industry average.
The Point-of-Care business continues to 
perform well, with growth being seen across 
most products. In particular, Quo-Lab 
instrument sales are up more than 30% on the 
previous year with the product now registered 
in more countries than ever, including Japan, 
which offers EKF a signiﬁ cant growth 
opportunity. Quo-Lab is a glycated 
hemoglobin analyser used in diabetes 
monitoring.
Biosen instrument sales are showing an 
increase of more than 8% on the previous year, 
mainly due to strong growth in Asia where we 
have signed a multi-million Euro contract with 
a new partner based in northern China. We 
do have signiﬁ cant challenges in Russia where 
Biosen is the major product line; we would 
expect to see a 70% drop in revenues in Russia 
due to the reduction in healthcare spending 
and the impact of the rouble. A large contract 
win in China will go some way to mitigate this. 
Biosen is a range of analysers which 
measure glucose and lactate quickly and 
precisely in clinics, laboratories and sports 
medicine facilities.
Hemo Control continues to perform well 
especially in Mexico and Latin America where 
we have continued to win signiﬁ cant tenders. 
The performance by Alere in the US market 
has been disappointing as the growth has not 
been as expected but we have continued to 
increase market share. The new sales 
infrastructure will enable us to support Alere 
in continuing to grow the US market. 
Hemo Control is a point of care device that 
provides immediate, lab-quality results for 
both hemoglobin and hematocrit from one 
simple test.
Central Laboratory
The main product in the Central Laboratory 
division, ß-HB, grew by 9%. Conversely, the 
Central Laboratory market is very 
competitive and we saw a decline overall. In 
2014 we took steps to mitigate this and in 2015 
we will launch a Procalcitonin marker (PCT) for 
sepsis diagnosis as a new product and also a 
new desktop Clinical Chemistry analyser. The 
Business Unit Director will also be responsible 
for expanding the Clinical Chemistry Business 
outside the US.
Molecular Diagnostics
Selah Genomics had a major setback in May 
2014 with the announcement that the 
reimbursement for the DME panel testing was 
to be signiﬁ cantly reduced. This led to the 
announcement that revenues for 2014 would 
be materially lower. Whilst DME testing 
continues, it will not be the focus of the 
management in 2015. Alongside PointMan™, 
Selah offers a signiﬁ cant opportunity for EKF 
over the next 3 years. In 2015 we will have a 
number of deliverables as set out in the 
Chairman’s Statement.
To deliver these we will be bringing all 
molecular products and services under one 
corporate identity as well as introducing US 
and UK industry experts to drive the molecular 
business which has real potential.
In 2014 Selah contributed £3.0m to full year 
revenues. Whilst we still face some choppy 
waters in the short term the change of focus 
has led to increased commercial 
opportunities and the potential for further 
signiﬁ cant partnerships. For example, as 
mentioned earlier, we have announced a 
collaboration with the Greenville Health 
System’s ITOR facility, DecisionQ, and BD 
Technologies which will use PrecisionPath as 
the basis of a system that supports improved 
clinical decisions in the treatment of colon 
cancer patients. This is one of a number of 
opportunities for Selah in 2015.  
The initial Selah purchase agreement was 
drafted to accommodate the risk of reduced 
reimbursement payments via a reduction in 
deferred consideration payments if certain 
performance targets were not met; the lower 
than anticipated sales from Selah is likely to 
result in the year one earn-out payment of 
$17.5m not being payable. We still believe that 
Selah represents a signiﬁ cant value 
opportunity to shareholders over the short to 
medium term if we deliver on the above.
During 2014 the value of PointMan
™
 to the 
molecular industry has become clear. 
PointMan
™
 signiﬁ cantly enhances the sensitivity 
of any molecular platform, as well as working 
on a number of sample types such as biopsy 
or liquid biopsy (whole blood), and can be 
utilised in the latest technologies such as 
circulating tumour cells and circulating free 
DNA. Additionally this has led to MGH, Gilupi 
and Angle evaluating PointMan
™
 on their 
differing technologies and we look forward to 
reporting on results in the near future.  ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 14
Our collaboration with The Institute of Life 
Sciences in Swansea has shown that PointMan
™
 
is effective in isolating and characterising 
certain low-level DNA mutations in blood, 
paving the way for the development of a 
simple cancer screening and diagnostic test 
based on a blood sample rather than a biopsy.  
The data highlighted the utility of a 
blood-based test and critically demonstrated 
that PointMan
™
 was highly sensitive and can 
detect just three mutant cells in a background 
of 10,000 wild type cells. 
The uniﬁ cation of the molecular business, the 
progress being made with PrecisionPath 
and the continued development of the 
commercial offering of PointMan
™
 provide 
the Company with conﬁ dence that 2015 will 
be a very signiﬁ cant year for establishing the 
credentials of the EKF Molecular Diagnostics 
division and a considerable generator of 
shareholder value.
New products
During 2014 we introduced or entered 
late-stage development of a number of new or 
improved product lines. These include:-
• SensPoint, a POC lactate measuring system  
 designed for use in peri-natal settings. 
• Enhancements to major revenue
 generating product lines to equip our 
 customers with data-management and 
 connectivity capability.
• Procalcitonin - this is a Central Laboratory   
 test for measuring sepsis.
• sTNFR1/2 biomarkers that will predict fast
 progressors to Chronic Kidney Disease   
 (CKD) in both Type 1 and 2 diabetics. If   
 untreated CKD can lead to End Stage Renal 
 Disease which is one of the costliest 
 conditions for healthcare payers. sTNFR1 has 
 been exclusively licenced from Joslin 
 Diabetes Centre in Boston and is a 
 signiﬁ cant development project for EKF.   
 EKF is working very closely with major 
 pharmaceutical and dialysis companies to   
 incorporate sTNFR1/2 as complementary   
 diagnostics with their therapies.
• Inborn Errors of Metabolism - EKF is 
 developing a POC system for monitoring 
 Phenylalanine levels in PKU (a rare genetic
 condition that is present from birth). The 
 company is working very closely with a 
 major pharmaceutical company with PKU 
 therapies on the market and signiﬁ cantly 
 improved drugs in late development. In PKU, 
 Phenylalanine (an amino acid) builds up and 
 if untreated can lead to mental retardation, 
 behavioural disorders, seizures and other 
 serious medical problems. 
Results
Revenue
Revenue for the year was £40.1m (2013: 
£31.8m), an increase of 26%. Overall, 
acquisitions contributed £6.5m to revenues. 
Underlying organic revenues accounted for 
£33.6m of total revenues which represented 
6% organic growth year-on-year.
Gross proﬁ t
Gross proﬁ t has increased to £19.9m (2013: 
£16.3m), which is an increase of 22%. Gross 
proﬁ t as a percentage of revenue is 49.8% 
(2013: 51.4%), largely as a result of the 
structurally lower margins on the Selah 
business because of the arrangements made 
with their billing and marketing partners.
Administration costs and research and 
development costs
Administrative expenses have increased by 
59.6%. The increase comes from the 
acquisitions, the additional amortisation 
associated with the acquisitions, added 
investment in sales resources, and from a 
number of exceptional items including the 
closure costs for our Dublin facility, the costs 
of moving manufacture of the Quo-Test and 
Quo-Lab products, and the costs of making 
the three acquisitions in the year. In addition 
to the R & D costs, included in administration 
costs of £1.3m, a further £1.5m of expenditure 
has been capitalised.
The charge for depreciation of ﬁ xed assets and 
for the amortisation of intangibles is £5.0m 
(2013: £3.6m).
Operating proﬁ t and adjusted earnings before 
interest tax and depreciation
The Group has made an operating loss of 
£2.5m (2013: proﬁ t of £2.4m) for the reasons 
outlined above. We consider a more 
meaningful measure of underlying 
performance to be adjusted EBITDA which for 
2014 was £6.3m (2013: £4.8m). This excludes 
the effects of share-based payments of £0.5m 
(2013: £0.7m) and exceptional losses of £3.3m 
(2013: exceptional gains of £1.8m). 
Finance costs
Finance costs have decreased to £1.6m (2013: 
£1.8m). The decrease is largely a result of 
fair value adjustments associated with the 
deferred shares withheld as part of the tax 
warranty claim.
Chief Executive’s Review continued 1.0 Strategic Review EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 15
Tax
There is a tax charge of £1.4m (2013: £1.5m). 
The charge is largely the result of the 
utilisation of a deferred tax asset associated 
with the Quotient business, as well as 
unrelieved losses made in certain jurisdictions. 
The effect of the potential tax warranty claim 
has been reduced following negotiations 
between the Group’s German subsidiary, its 
tax advisers, and the German tax authorities. 
We are hopeful this issue will be fully resolved 
early in 2015. The reduced tax charge has an 
associated reduction of the warranty claim, 
this amount has been included in exceptional 
items.
Balance sheet
Property, plant and equipment
We have invested £1.0m (2013: £1.2m) in 
property plant and equipment. Major projects 
include building work at Barleben and 
additional equipment at Selah, both to increase 
capacity.
Intangible assets
Intangible assets have increased substantially 
following the three acquisitions made in March 
and April, plus further capitalisation of 
development costs. Following the closure 
of the Group’s Dublin facility, the associated 
goodwill and trade secret assets, and the 
capitalised development cost associated with 
the Renastat project of £1.2m, have been 
impaired in full.
Deferred consideration
The ﬁ nal payment of deferred consideration of 
£0.4m in respect of the acquisition of Quotient 
Diagnostics Ltd was made during the year. The 
small remaining provision has been credited to 
exceptional items. The deferred consideration 
payable to the vendors of DiaSpect Medical 
was renegotiated down to £1.4m and this was 
paid in January 2015.
Cash and working capital
Cash used in operations in 2014 is £3.3m (2013: 
£3.1m generated). Following the fund raising in 
April, the Group had cash on hand at 31 
December 2014 of £8.3m (2013: £2.5m), and 
a net cash position of £2.1m (2013: £0.1m).  
Trade debtors at year end are especially high 
as a result of sales to Mexico made during the 
year and especially in December. Payment of 
some of these outstanding amounts totalling 
£5.5m has been delayed because of slow 
payments to the relevant distributors by the 
Mexican Government.
Outlook
Whilst we acknowledge that 2014 was a 
challenging year where we had setbacks, we 
performed very creditably with 26% overall 
growth and we made very signiﬁ cant 
progress. It is clear what we have to deliver in 
2015 and we are very conﬁ dent that this will 
be achieved. In 2015 we will see a number of 
new products being brought to market as well 
as improvements to some of our important 
existing products. 
The integration of Selah and EKF Molecular 
Diagnostics into one company will reap short 
and medium term rewards and Selah’s 
PrecisionPath service, which provides a panel 
of clinically validated biomarkers that can be 
used to design speciﬁ c personalised treatment 
plans for cancer patients, represents a huge 
opportunity for growth. This has the potential 
to become a very high margin reimbursable 
testing service and the Company will keep 
Shareholders updated as this progresses. 
Additionally, it is clear how advantageous 
PointMan™ will be in the next generation of 
molecular diagnostic testing.
We believe that this report provides 
Shareholders with very clear guidance on 
our deliverables for 2015. In addition to these 
operational goals we are determined to deliver 
sensible ﬁ nancial goals and as such have set 
as one of our key performance indicators the 
challenge to deliver at least 10% annual organic 
growth therefore outperforming our industry 
peers. We are convinced that by taking a more 
measured approach we are putting in place all 
of the factors required to become even more 
successful and to produce long term 
sustainable double digit growth, and value for 
shareholders.
Julian Baines
Chief Executive Ofﬁ cer
16 March 2015
1.0 Strategic Review ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 16
Board of Directors 1.0 Strategic Review
Executive Board
David Evans
Executive Chairman (aged 54)
David has signiﬁ cant experience and contacts worldwide within the IVD industry and is currently 
Chairman of the following listed companies: Omega Diagnostics Group plc, Collagen Solutions plc, 
Epistem Holdings plc, Scancell Holdings plc, Venn Life Sciences Holdings plc, Premaitha Health 
plc, and Opibiotix Health plc. In addition he was formerly Chairman of Immunodiagnostics Systems 
Holdings plc and BBI Holdings Limited (“BBI”) and Joint-Managing Director of Axis-Shield plc. He 
also sits on the Board of a number of private companies.
Julian Baines
Chief Executive Ofﬁ cer (aged 50)
Julian was Group CEO of BBI where he undertook a management buyout in 2000, a ﬂ otation on AIM 
in 2004 and was responsible for selling the business to Alere Inc. in 2008 for circa £85 million. In 
December 2009 Julian became CEO of the Group and has subsequently successfully completed 
fund raisings in 2010, 2011 and 2014, and the acquisition and subsequent integration of eight 
businesses in seven countries building revenue from zero to over £40m.
Richard Evans
Chief Operating Ofﬁ cer (aged 57)
Richard qualiﬁ ed as a Chartered Management Accountant in 1983 and holds a Bachelor of 
Commerce in Business Studies and Law from Edinburgh University and an MBA from INSEAD. 
Before joining EKF Richard was Finance Director, General Manager and ﬁ nally Global Account 
Director at Hitachi Data Systems GmbH. He has also held positions at Fisher Scientiﬁ c, TRW Seat 
Belt Systems, Maxtor Corporation, United Technologies Carrier and Abbot Diagnostics GmbH in 
Germany.
Paul Foulger
Finance Director and Company Secretary (aged 45)
Paul is a qualiﬁ ed certiﬁ ed accountant with extensive public and private company experience 
having been Finance Director at Venn Life Sciences Holdings plc, First Africa Oil plc, Cielo Holdings 
plc, Elsevier Science, Orogen Gold plc and Porta Communications plc, amongst others. Paul was 
Finance Director for EKF until September 2011 and was then reappointed in July 2013 when Richard 
Evans was promoted to Chief Operating Ofﬁ cer; he currently holds several other directorships, 
including, Autoclenz Group Limited and Arcis Biotechnology Limited. Paul holds an MBA from 
Warwick Business School.
Tito Bacarese-Hamilton
Chief Technology Ofﬁ cer (aged 57)
Tito is a clinical biochemist by training and brings more than 25 years of research and industrial 
experience in the medical and life sciences sector. Prior to joining EKF he was Vice President, R&D at 
LifeScan, a Johnson & Johnson company, where he had global responsibility for the full-scale 
development and commercial launch of all new products and platforms. Tito was also a founder of 
Quotient Diagnostics, which was acquired by EKF in 2010. Tito graduated from King’s College, 
London and earned his PhD at the Royal Postgraduate Medical Centre in London. He is a Fellow of 
the American National Association of Clinical Biochemistry, a member of the European Association 
for the Study of Diabetes and has published more than 50 peer-reviewed articles on a variety of 
topics related to pathology, oncology and laboratory medicine. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 17
1.0 Strategic Review
Non-Executive Board
David Toohey
Non-Executive Director (aged 57)
David has over 30 years’ experience in international business; in electronics system design and 
manufacturing settings and in medical devices. After holding senior positions in Bausch+Lomb and 
Boston Scientiﬁ c he joined Inverness Medical (now Alere Inc) in 2001, where he fulﬁ lled a number of 
roles including VP New Products, President Global Professional Diagnostics and President 
International Business Operations. He is a Fellow of Engineers Ireland and a Chartered Engineer, 
holds an MBA and is a member of the Institute Of Directors. He is CEO and founder of Syncrophi 
Systems Ltd, a company pioneering the development of next-generation frontline patient care and 
clinical informatics solutions and is on the board of Croi, the non-proﬁ t West of Ireland Cardiology 
Foundation.
Adam Reynolds
Non-Executive Director (aged 52)
Adam is a former stockbroker specialising in corporate ﬁ nance. He has built, rescued and 
re-ﬁ nanced a number of public companies. He is currently Chairman of Autoclenz Group Limited, 
Orogen Gold plc, and Hubco Investments plc and a Director of OptiBiotix Health plc, Premaitha 
Health plc, and Verdes Management plc.
Doris-Ann Williams MBE
Non-Executive Director (aged 54)
Doris-Ann Williams has been Chief Executive of the British In Vitro Diagnostics Association (BIVDA) 
since October 2001 and has more than 30 years’ experience working in the IVD sector. She has had 
a variety of experience, initially in R&D and subsequently in commercial roles. She is on the editorial 
board of IVD Technology, sits on a number of steering groups including that of the Technology 
Strategy Board and is currently on the NHS Implementation Board for Innovation, Health and Wealth. 
She also works closely with European Diagnostic Manufacturers Association and other global IVD 
industry associations. She was awarded an MBE in January 2011 and was recognised as a Friend of the 
Royal College of Pathologists in November 2012. 
Kevin Wilson
Non-Executive Director (aged 64)
Kevin has been on the board of a number of public and private businesses and was Senior 
Independent Director of BBI from its AIM ﬂ otation to its sale in 2008. He has been active in 
Investment Banking and Stockbroking for 30 years as a corporate ﬁ nance adviser and is FSA 
registered. He carries a PhD in Finance and an MBA in Business and is a Visiting Fellow at 
Manchester Business School and Visiting Senior Lecturer in Finance and Accounting at the 
University of Lancaster Management School. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 18
Strategic Report for the year ended 31 December 2014 2.0 Corporate Governance
Review of the business
A review of the business is contained in the Chairman’s Statement on pages 10 and 11, and in the Chief 
Executive’s Review on pages 12 to 15.
Risk management
We recognise that effective risk management is essential to the successful delivery of the Group’s 
strategy and will help us build a world class in-vitro diagnostic business. As we continue to grow our 
business we believe it is important to develop and enhance our approach to risk management, and 
to ensure it remains ﬁ t for purpose. In the last quarter of 2014 we began enhancing and formalising 
our risk management processes and have started the journey of maturing our approach to how we 
identify and manage risks across the Group, in a consistent and robust manner. As such we are in the 
process of establishing a Risk Steering Committee, reporting to the Group Chairman and Finance 
Director, whose aim will be to formally review and manage the Group’s risk proﬁ le and control 
environment.
Below we describe our risk management approach, the principal risks and uncertainties faced by the 
Group and the controls in place to manage them. 
Overview of risk management approach
Each business area is responsible for identifying, assessing and managing the risks in their respective 
area. Risks are identiﬁ ed and assessed by all business areas on a periodic basis and are measured 
against a deﬁ ned set of criteria, considering likelihood of occurrence and potential impact. The 
Executive Board members also conduct a strategic risk identiﬁ cation and assessment exercise to 
identify risks, including those that could impact the business model, future performance, solvency or 
liquidity. This risk information is combined with a consolidated view of the business area risks. The 
most signiﬁ cant risks identiﬁ ed form our Group Risk Proﬁ le, which is reported to the Executive Board 
for review and challenge, ahead of it being submitted to the Group Board for ﬁ nal review, challenge 
and approval. The Board has the overall accountability for ensuring that risk is effectively managed 
across the Group and therefore ensuring that it is comfortable with the nature and extent of the 
principal risks faced in achieving its strategic objectives. During the course of 2015 the policies and the 
improved internal control environment established will underpin our approach to the risk 
management.  
Principal risks and uncertainties
Set out below are the principal risks which we believe could materially affect the Group’s ability to 
achieve its ﬁ nancial and operating objectives and control or mitigating activities adopted to manage 
them. The risks are not listed in order of signiﬁ cance. 
Key employees
Lack of retention of key employees affects the continuity and effectiveness of on-going relationships 
with key customers and suppliers. 
This risk is minimised by ensuring that a minimum of two individuals manage every relationship with 
key customers and suppliers. In addition, in retaining the key employees, incentivisation packages are 
offered through a mixture of sales commission, proﬁ t related bonuses and participation in the Group 
LTIP and share option schemes. Main Board Directors are incentivised as detailed in the Directors’ 
Remuneration Report.
Political risk
A signiﬁ cant proportion of the Group’s revenues are accounted for by agreements in developing 
countries. Any instability in these countries could signiﬁ cantly affect the operations and the revenue 
of the Group. In particular, the Group has signiﬁ cant revenue from customers in Mexico and Russia 
which are ultimately largely funded by the governments of those countries.
The Group spreads the risk through seeking a portfolio of diversiﬁ ed revenue streams geographically 
with a mixture of distribution partners in developing and developed countries. 
Supply chain continuity
The Group relies on third party manufacturers for the supply of the majority of raw materials. 
Problems with obsolescence and manufacturer facilities may lead to delay and disruptions in the 
supply chain which could have a signiﬁ cant negative impact on the Group. The Group maintains a 
close dialogue with key suppliers and closely monitors its inventory status and customer demand to 
ensure that any problems with the supply chain can be managed and back up sources of supply are 
maintained where possible.
Regulatory risk
There can be no guarantee that any of the Group’s products will be able to obtain or maintain the 
necessary regulatory approvals in any or all of the territories in respect of which applications for such 
approvals are made. Where regulatory approvals are obtained, there can be no guarantee that the 
conditions attached to such approvals will not be considered too onerous by the Group or its 
distribution partners in order to be able to market its products effectively.  EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 19
2.0 Corporate Governance
The Group seeks to reduce this risk by manufacturing the products to recognised standards, by 
keeping appraised with changes in the standards geographically, by seeking advice from regulatory 
advisers, consultations with regulatory approval bodies and by working with experienced 
distribution partners.
Competition risk
Due to the Group’s current and future potential competitors, such as major multinational 
pharmaceutical and healthcare companies having substantially greater resources than those of the 
Group, the competitors develop systems and products that are more effective or economic than any 
of those developed by the Group, rendering the Group’s products obsolete or otherwise 
non-competitive. 
The Group seeks to mitigate this risk by securing patent registration protection for its products, 
maintaining conﬁ dentiality agreements regarding the Group’s know-how and technology, 
monitoring technological developments and by selecting leading businesses in their respective ﬁ elds 
as distribution partners capable of addressing signiﬁ cant competition, should it arise.
Intellectual property risk
The commercial success of the Group and its ability to compete effectively with other companies 
depends, amongst other things, on its ability to obtain and maintain patents sufﬁ ciently broad in 
scope to provide protection for the Group’s intellectual property rights against third parties and to 
exploit its products. The absence of any such patents may have a material adverse effect on the 
Group’s ability to develop its business. 
The Group mitigates this risk by developing products where legal advice indicates patent 
protection would be available, seeking patent protection for the Group’s products, maintaining 
conﬁ dentiality agreements regarding Group know-how and technology and monitoring 
technological developments and the registration of patents by other parties. The commercial 
success of the Group also depends upon not infringing patents granted, now or in the future, to third 
parties who may have ﬁ led applications or who have obtained, or may obtain, patents relating to 
business processes which might inhibit the Group’s ability to develop and exploit its own 
products.
Foreign exchange risk
The Group has transactional currency exposures as the majority of revenues and expenditure and 
certain borrowings and deferred consideration are denominated in foreign currencies. Fluctuations in 
exchange rates between the Group’s functional currency of Sterling and the currency of the overseas 
operations could adversely impact the ﬁ nancial results. In most cases the Group matches the currency 
receipts and expenditure of the overseas operations. The Group also endeavours to match the foreign 
currency assets of the foreign operations by funding through borrowings and loans denominated in 
the currency of the overseas operations, and to negotiate currency protection in major contracts.
Reimbursement levels
There is no guarantee that the Group may be able to sell its products or services proﬁ tably if the 
reimbursement levels from third party payers, including government and private health insurers, is 
unavailable or limited.  Third party payers are increasingly attempting to contain health care costs 
through measures that could impact the Group including challenging the prices charged for health 
care products and services, limiting both coverage and the amount of reimbursement for new 
diagnostics products and services, and denying or limiting coverage for products that are approved 
by the regulatory agencies but are considered experimental by third party payers.
The Group understands that due to third party dependency it is extremely difﬁ cult to eradicate this 
risk. However, the Group manages this risk with constant dialogue and educating the third party 
payers on the Group’s products and also developing new technologies in order to seek additional 
reimbursements.
 
Financial reporting and disclosure
Due to the growth of the Group there is a constant pressure to report accurate ﬁ nancial information in 
compliance with accounting standards and applicable legislation. 
This risk is mitigated with the Group’s internal controls over the ﬁ nancial information and reporting 
overseen by the local ﬁ nancial heads and then reviewed by the central ﬁ nance team, including the 
Finance Director. The annual ﬁ nancial statements are also subject to audit by the Group’s external 
auditors. 
Review of strategy and business model
The Board of Directors judges the Company’s ﬁ nancial performance by reference to the internal 
budget which it establishes at the beginning of each ﬁ nancial year.
EKF’s strategy is to create a world class IVD business through acquisition and organic growth, a 
so-called “buy and build” strategy. IVD has a wide spectrum, and within this spectrum we have 
chosen to concentrate on three distinct areas: Point-of-Care, especially in the areas of diabetes, 
hemotology, and women’s health; Central Laboratory; and Molecular Diagnostics. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 20
Strategic Report for the year ended 31 December 2014 2.0 Corporate Governance
We have succeeded in identifying and acquiring businesses in these areas with strong product lines 
and distribution networks which can beneﬁ t from better, more professional management, greater 
resources, and from the synergistic beneﬁ ts of being part of a larger group.
We sell worldwide to over 100 countries. In many territories we sell through local distributors, 
however where appropriate we sell direct to end users which include hospitals, laboratories, and 
government agencies. Our distributors are supported by a network of regional sales managers and 
by product managers who are specialists in our product range. We manufacture the majority of the 
products we sell ourselves, but also distribute a number of carefully chosen products on behalf of 
others. We have research and development centres in the UK and Germany, and also perform or 
manage research and development projects in the USA.
The Group works mainly on the principle of selling value priced instrumentation which generates 
long-term revenue streams from the subsequent sale of consumables. The Molecular Diagnostics 
division sells kits which are used for the enrichment of samples for DNA testing and provides 
diagnostic tests to physicians and their patients. The Group has an existing portfolio of technologies 
which produce revenues and will add technologies which are strategically appropriate to this 
portfolio should they become available and providing the additions make economic sense.
Future outlook
The Chairman’s Statement on pages 10 and 11 and the Chief Executive’s Review on pages 12 to 15 
give information on the future outlook of the Group, including the main trends and factors likely to 
affect its future development. 
Key Performance Indicators (KPIs)
The key performance indicators currently used by the Group are revenue, gross margin, adjusted 
EBITDA and cash resources. The Group intends to establish other key performance indicators in due 
course once the Group has matured sufﬁ ciently. The Group does not use and does not at present 
intend to use non-ﬁ nancial key performance indicators. KPIs are discussed in more detail in the 
Chief Executive’s Review on pages 12 to 15.
Environment
The Directors consider that the nature of the Group’s activities is not inherently detrimental to the 
environment. The Group is committed to minimising any effect on the environment caused by its 
operations.
Employees
The Group places value on the involvement of its employees and they are regularly briefed on the 
Group’s activities. The Group closely monitors staff attrition rates which it seeks to maintain at 
current low levels and aims to structure staff compensation levels at competitive rates in order to 
attract and retain high calibre personnel.
Disabled employees
Applications for employment by disabled persons are always fully considered, bearing in mind the 
speciﬁ c aptitudes of the applicant involved. It is the policy of the Group that the training, career
development and promotion of disabled persons, as far as possible, be identical with that of other 
employees.
Social, community, and human rights
The Board recognises that the Group has a duty to be a good corporate citizen and to respect the 
laws and where appropriate the customs and culture of the territories in which it operates. The 
Group has donated products to selected appropriate charities which operate within its area, and 
supports staff who are taking part in charitable activities which are related to our business areas or 
customers. It contributes, as far as is practicable, to the local communities in which it operates and 
takes a responsible and positive approach to employment practices.
The Strategic Report was approved by the Board on 16 March 2015 and signed on its behalf by:
Paul Foulger
Finance Director and Company Secretary EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 21
2.0 Corporate Governance Report of the Directors for the year ended 31 December 2014
The Directors have pleasure in submitting this report together with the audited consolidated 
ﬁ nancial statements of EKF Diagnostics Holdings plc for the year ended 31 December 2014.
Corporate details
EKF Diagnostics Holdings public limited company is incorporated and registered in England and 
Wales number 4347937. The registered ofﬁ ce is Avon House, 19 Stanwell Road, Penarth, Cardiff 
CF64 2EZ.
Directors
The Directors who held ofﬁ ce during the year and as at the date of signing the ﬁ nancial 
statements were as follows:
David Evans
Julian Baines
Tito Bacarese-Hamilton (appointed 2 June 2014)
Richard Evans
Paul Foulger
Gordon Hall (resigned 31 March 2014)
Adam Reynolds
David Toohey (appointed 15 August 2014)
Doris-Ann Williams (appointed 15 August 2014)
Kevin Wilson
Principal activities
During the year the principal activities of the Group and Company were the development, 
manufacture and supply of products into the in-vitro diagnostics (IVD) market place, and the 
development and supply of products and services into the molecular diagnostics market. Future 
developments and research and development activities are discussed in the Chairman’s 
Statement on pages 10 and 11 and the Chief Executive’s Review on pages 12 to 15.
Dividends
There were no dividends paid or proposed by the Company in either year.
Going concern
The Directors have considered the applicability of the going concern basis in the preparation 
of these ﬁ nancial statements. This included the review of internal budgets and ﬁ nancial results 
which show, taking into account reasonably probable changes in ﬁ nancial performance, that the 
Group should be able to operate within the level of its current funding arrangements.
After making enquiries, the Directors have a reasonable expectation that the Group has 
adequate resources to continue in operational existence for the foreseeable future. The Group 
therefore continues to adopt the going concern basis of preparation for its consolidated 
ﬁ nancial statements.
Financial risk management
Financial risk management is discussed in Note 3 of the ﬁ nancial statements.
Creditors payment policy
It is the policy of the Group and Company to agree appropriate terms and conditions for its 
transactions with suppliers (ranging from standard written terms to individual negotiated 
contracts) and for payment to be made in accordance with these terms provided the supplier 
has complied with its obligations. The average numbers of days credit taken by the Group as at 
31 December 2014 was 29 days (2013: 23 days).
Employee policies
Employee policies are discussed in the Strategic Report on pages 18 to 20. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 22
2.0 Corporate Governance
Directors’ interests
The interests of those Directors serving at 31 December 2014 and as at the date of signing of 
these ﬁ nancial statements, all of which are beneﬁ cial, in the share capital of the Company were 
as follows:
 On 31 December 2014  On 1 January 2014*
 Ordinary Shares of 1p each Ordinary Shares of 1p each 
  
 
David Evans 1,805,753 1,534,325
Julian Baines 1,721,955 1,550,527
Tito Bacarese-Hamilton 106,429 106,429
Richard Evans 178,842 96,700
Paul Foulger 3,488,589 3,410,018
Adam Reynolds 3,229,724 3,176,153
David Toohey - -
Doris-Ann Williams - -
Kevin Wilson 947,846 897,846
*or at the date of appointment where later.
On 20 March 2014, David Evans subscribed for 71,428 ordinary shares, Julian Baines subscribed 
for 71,428 ordinary shares, Richard Evans subscribed for 57,142 ordinary shares, Paul Foulger
subscribed for 28,571 ordinary shares, and Adam Reynolds subscribed for 28,571 ordinary 
shares, all at 35p. On 8 May 2014 David Evans purchased 100,000 ordinary shares, Julian Baines 
purchased 100,000 ordinary shares, Richard Evans purchased 25,000 shares, Paul Foulger 
purchased 50,000 ordinary shares, Adam Reynolds purchased 25,000 ordinary shares, and 
Kevin Wilson purchased 50,000 ordinary shares, all at 25.07p. David Evans purchased
100,000 ordinary shares at a purchase price of 23 pence per share on 1 October 2014.
Substantial shareholdings
As at 12 March 2015, the following interests in 3% or more of the issued Ordinary Share capital 
had been notiﬁ ed to the Company:
 Number of shares Percentage of issued  
  share capital
Chase Nominees Limited 56,110,396 13.3%
Nortrust Nominees Limited 36,306,403 8.6%
HSBC Client Holdings Nominee (UK) Limited 33,019,975 7.8%
HSBC Global Custody Nominee (UK) Limited 32,940,459 7.8%
Vidacos Nominees Limited 23,250,034 5.5%
The Bank of New York (Nominees) Limited 22,512,092 5.3%
Pershing Nominees Limited 21,529,250 5.1%
State Street Nominees Limited 12,718,488 3.0%
 
Statement of Directors’ responsibilities
The Directors are responsible for preparing the Annual Report and the ﬁ nancial statements in 
accordance with applicable law and regulations.
Company law requires the Directors to prepare ﬁ nancial statements for each ﬁ nancial year. 
Under that law the Directors have prepared the Group and Parent Company ﬁ nancial 
statements in accordance with International Financial Reporting Standards (IFRSs) as 
adopted by the European Union. Under Company law the Directors must not approve the 
ﬁ nancial statements unless they are satisﬁ ed that they give a true and fair view of the state of 
affairs of the Group and the Company and of the proﬁ t or loss of the Group for that period. In 
preparing these ﬁ nancial statements, the Directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and accounting estimates that are reasonable and prudent;
• state whether applicable IFRSs as adopted by the European Union have been followed, 
 subject to any material departures disclosed and explained in the ﬁ nancial statements; and
• prepare the ﬁ nancial statements on the going concern basis unless it is inappropriate to 
 presume that the Company and the Group will continue in business.
Report of the Directors for the year ended 31 December 2014 EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 23
2.0 Corporate Governance
The Directors are responsible for keeping adequate accounting records that are sufﬁ cient to 
show and explain the Company’s transactions and disclose with reasonable accuracy at any 
time the ﬁ nancial position of the Company and the Group and enable them to ensure that the 
ﬁ nancial statements comply with the Companies Act 2006. They are also responsible for 
safeguarding the assets of the Company and the Group and hence for taking reasonable steps 
for the prevention and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the Company’s website. 
Legislation in the United Kingdom governing the preparation and dissemination of ﬁ nancial 
statements may differ from legislation in other jurisdictions.
Directors’ liability insurance
The Company has entered into deeds of indemnity for the beneﬁ t of each Director of the 
Company in respect of liabilities to which they may become liable in their capacity as Director 
of the Company and of any Company in the Group. Those indemnities are qualifying third party 
indemnity provisions for the purposes of Section 234 of the Companies Act 2006 and have 
been in force during the whole of the ﬁ nancial year and up to the date of approval of the 
ﬁ nancial statements.
Independent auditors
PricewaterhouseCoopers LLP has expressed their willingness to continue in ofﬁ ce as auditors 
and a resolution to reappoint them will be proposed at the forthcoming Annual General 
Meeting.
Disclosure of information to the Auditors
The Directors who hold ofﬁ ce at the date of approval of this report conﬁ rm that so far as they 
are each 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 or she ought to have taken as a 
Director in order to make himself or herself aware of any relevant audit information and to 
establish that the Company’s auditors are aware of that information.
Corporate Governance
The Company’s statement of corporate governance can be found in the Corporate Governance 
Statement on pages 24 and 25 of these ﬁ nancial statements. The Corporate Governance 
Statement forms part of this Report of the Directors and is incorporated into it by 
cross-reference.
Annual General Meeting
The resolutions to be proposed at the forthcoming Annual General Meeting are set out in the 
formal notice of the meeting, as set out on page 70.
Recommendation
The Board considers that the resolutions to be proposed at the Annual General Meeting are in 
the best interests of the Company and it is unanimously recommended that Shareholders 
support these proposals as the Board intends to do in respect of their own holdings.
  ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 24
Corporate Governance Statement 
for the year ended 31 December 2014 2.0 Corporate Governance
Compliance
The Directors recognise the value of the principles of the UK Corporate Governance Code (the 
Code). Although, as an AIM Company, compliance with the Code is not required, the Group seeks to 
apply the Code where practicable and appropriate for a business of its size.
The following statement describes how the Group as at 31 December 2014 sought to address the 
principles underlying the Code.
Board composition and responsibility
The Board currently comprises ﬁ ve Executive Directors and four Non-Executive Directors. During 
the year Gordon Hall resigned as a Non-Executive Director, Tito Bacarese-Hamilton joined as an 
Executive Director, and David Toohey and Doris-Ann Williams joined as Non-Executive Directors. 
The Board notes that the Combined Code guidance recommends that at least half the Board should 
comprise independent Non-Executive Directors. The Board has determined that Kevin Wilson, 
Adam Reynolds, David Toohey, and Doris-Ann Williams are independent in character and 
judgement and that there are no relationships or circumstances which could materially affect or 
interfere with the exercise of their independent judgement. The Board is satisﬁ ed with the balance 
between Executive and Non-Executive Directors which allows it to exercise objectivity in decision 
making and proper control of the Company’s business. The Board considers its composition is 
appropriate in view of the size and requirements of the Group’s business and the need to maintain a 
practical balance between executives and non-executives. Due to the structure of the Company it is 
considered that it is not appropriate to make any further changes to the successful Board 
composition at present.
There is a division of responsibilities between the Executive Chairman, who is responsible for the 
overall strategy of the Group and running the Board, and the CEO, who is responsible for 
implementing the strategy and day to day running of the Group. He is assisted by the Finance 
Director, Chief Operating Ofﬁ cer, and Chief Technology Ofﬁ cer.
All Directors are subject to election by Shareholders at the ﬁ rst Annual General Meeting after their 
appointment, and are subject to re-election at least every three years. Non-Executive Directors are 
appointed for a speciﬁ c term of ofﬁ ce which provides for their removal in certain circumstances,
including under section 168 of the Companies Act 2006. The Board does not automatically 
re-nominate Non-Executive Directors for election by Shareholders. The terms of appointment of the 
Non-Executive Directors can be obtained by request to the Company Secretary.
The Board’s primary objective is to focus on adding value to the assets of the Group by identifying 
and assessing business opportunities and ensuring that potential risks are identiﬁ ed, monitored and 
controlled. Matters reserved for Board decisions include strategic long-term objectives and capital 
structure of major transactions. The implementation of Board decisions and day to day operations 
of the Group are delegated to Management.
Board meetings
11 Board meetings were held during the year. The Directors’ attendance record during the year, 
along with the number of meetings held during their tenure is as follows:
David Evans (Executive Chairman) 11 (11)
Julian Baines (Chief Executive Ofﬁ cer) 11 (11)
Tito Bacarese-Hamilton (Chief Technology Ofﬁ cer) 6 (6)
Richard Evans (Chief Operating Ofﬁ cer) 10 (11)
Paul Foulger (Finance Director and Company Secretary) 11 (11)
David Toohey (Non-Executive Director) 4 (4)
Doris-Ann Williams (Non-Executive Director)  3 (4)
Kevin Wilson (Non-Executive Director) 10 (11)
Adam Reynolds (Non-Executive Director) 11 (11)
Gordon Hall (Non-Executive Director) 3 (3)
Audit Committee
This comprises three Non-Executive Directors, Kevin Wilson (Chairman), David Toohey, and Adam 
Reynolds. Kevin Wilson is the Senior Independent Director and has recent and relevant ﬁ nance 
experience. The principal duties of the Committee are to review the half-yearly and annual ﬁ nancial 
statements before their submission to the Board and to consider any matters raised by the auditors. 
The Committee also reviews the independence and objectivity of the auditors.  EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 25
2.0 Corporate Governance
The terms of reference of the Committee reﬂ ect current best practice, including authority to:
• Recommend the appointment, re-appointment and removal of the external auditors;
• Ensure the objectivity and independence of the auditors including occasions when non-audit   
 services are provided; and
• Ensure appropriate ‘whistle-blowing’ arrangements are in place.
The Non-Executive Directors may seek information from any employee of the Group and obtain 
external professional advice at the expense of the Company if considered necessary. Due to the 
relatively low number of personnel employed within the Group, the nature of the business and the 
current control and review systems in place, the Board has decided not to establish a separate 
internal audit department. The Committee met once during 2014.
Remuneration Committee
The Company has established a formal and transparent procedure for developing policy on executive 
remuneration and for ﬁ xing the remuneration packages of individual Directors. No Director is involved 
in deciding his own remuneration.
The remuneration committee is made up of Adam Reynolds (Chairman), Kevin Wilson and Doris-Ann 
Williams. The Committee considers the employment and performance of individual Executive 
Directors and determines their terms of service and remuneration. It also has authority to grant 
options under the Company’s Executive Share Option Scheme. The Committee did not meet during 
2014 but intends to do so during the current year. 
Board appointments
There is no formal Nominations Committee, the appointment of new Directors being considered by 
the full Board.
Internal control
The Directors are responsible for ensuring that the Group maintains a system of internal control to 
provide them with reasonable assurance regarding the reliability of ﬁ nancial information used within 
the business and for publication and that the assets are safeguarded. There are inherent limitations 
in any system of internal control and accordingly even the most effective system can provide only 
reasonable, but not absolute, assurance with respect to the preparation of ﬁ nancial reporting and the 
safeguarding of assets.
The Group, in administering its business, has put in place strict authorisation, approval and control 
levels within which senior management operates. These controls reﬂ ect the Group’s organisational 
structure and business objectives. The control system includes clear lines of accountability and covers 
all areas of the organisation. The Board operates procedures which include an appropriate control 
environment through the deﬁ nition of the above organisation structure and authority levels and the 
identiﬁ cation of the major business risks. The Group has commenced a project to enhance and 
formalise its internal controls including the establishment of a Risk Steering Committee.
Internal ﬁ nancial reporting
The Directors are responsible for establishing and maintaining the Group’s system of internal 
reporting and as such have put in place a framework of controls to ensure that on-going ﬁ nancial 
performance is measured in a timely and correct manner and that risks are identiﬁ ed as early as is 
practicably possible. There is a comprehensive budgeting system and monthly management accounts 
are prepared which compare actual results against both the budget and the previous year. They are 
reviewed and approved by the Board and revised forecasts are prepared on a regular basis.
Relations with Shareholders
The Company reports to Shareholders twice a year. The Company dispatches the notice of its Annual 
General Meeting, together with a description of the items of special business, at least 21 clear days 
before the meeting. Each substantially separate issue is the subject of a separate resolution and all 
Shareholders have the opportunity to put questions to the Board at the Annual General Meeting. The 
Chair(s) of the Audit and Remuneration Committees normally attend the Annual General Meeting and 
will answer questions which may be relevant to their work. The Chairman advises the meeting of the 
details of proxy votes cast on each of the individual resolutions after they have been voted on in the 
meeting. The Chairman and the Non-Executive Directors intend to maintain a good and continuing 
understanding of the objectives and views of the Shareholders.
Corporate social responsibility
The Board recognises that the Group has a duty to be a good corporate citizen and is conscious that 
its business processes minimise harm to the environment, that it contributes as far as is practicable to 
the local communities in which it operates and takes a responsible and positive approach to 
employment practices.
The Report of the Directors was approved by the Board on 16 March 2015 and signed on its behalf by:
Paul Foulger
Finance Director and Company Secretary ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 26
Report of the Remuneration Committee for the year ended 31 December 2014
Statement of compliance
This report does not constitute a Directors’ Remuneration Report in accordance with the Directors’ Remuneration Regulations 2007 
which do not apply to the Company as it is not fully listed. This report sets out the Group policy on Directors’ remuneration, including 
emoluments, beneﬁ ts and other share-based awards made to each Director.
Policy on Executive Directors’ remuneration
Remuneration packages are designed to motivate and retain Executive Directors to ensure the continued development of the Group 
and to reward them for enhancing value to shareholders. The main elements of the remuneration package for Executive Directors are 
basic salary or fees, performance-related bonuses, beneﬁ ts and share option incentives.
Directors’ remuneration
The remuneration of the Directors for the year ended 31 December 2014 is shown below:
 Salary  Beneﬁ ts
 and fees Pension in kind Bonus 2014 2013
 £’000 £’000 £’000 £’000 £’000 £’000 
Executive Directors      
David Evans* 45 - - - 45 45
Tito Bacarese-Hamilton** 182 4 7 - 193 -
Julian Baines 238 12 12 - 262 306
Paul Foulger 167 8 7 - 182 21
Richard Evans 184 5 12 - 201 229
  816 29 38 - 883 601
Non-Executive Directors      
David Toohey** 11 - - - 11 -
Doris-Ann Williams** 11 - - - 11 -
Kevin Wilson 25 - - - 25 25
Adam Reynolds 25 - 3 - 28 29
Gordon Hall*** 12 - - - 12 25
 84 - 3 - 87 79
Total fees and emoluments 900 29 41 - 970 680
*  
David Evans’ remuneration is paid through his personal consultancy, MBA Consultancy.
**  
Remuneration for Tito Bacarese-Hamilton, David Toohey, and Doris-Ann Williams is shown from their date of appointment.
*** 
Gordon Hall’s remuneration is shown up to his date of resignation.
Directors’ share options and Long-Term Incentive Plan
As at 31 December 2014 the following options to Directors of the Company existed under the Company’s unapproved share-option 
scheme and Long-Term Incentive Plan:
 Option price per Number of Ordinary
Option Holder Ordinary Share Shares under option  Exercise period
David Evans 15p 8,545,638  1 January 2014 – 31 December 2020
Tito Bacarese-Hamilton 35p 1,300,000 30 May 2017-30 May 2024
Julian Baines 15p 8,545,638 1 January 2014 – 31 December 2020
Richard Evans 20p 4,260,000 1 January 2014 – 31 December 2020
Paul Foulger 35p 1,000,000 17 April 2017 - 17 April 2024
Half of the options granted to David Evans and Julian Baines and all the options of Richard Evans are subject to the achievement of 15% 
compound annual Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) growth for the three years commencing on 
1 January 2011. The base EBITDA was equal to twice the audited EBITDA achieved by the Group for the six months ending 31 December 
2010. This condition has now been met. The key terms for the remaining awards were revised on 11 June 2013. The key terms of these 
are as follows. For each test, the shares will vest if the Company’s mid-market closing share price attains the required price or higher for 
a period of 20 (60p options: 30) consecutive days at any time during the period commencing on 1 January 2011 and ending on 
31 December 2016 .
a) 1,709,128 notional shares will vest if the share price attains 30 pence. This condition has now been met.
b) 1,709,128 notional shares will vest if the share price attains 37.5 pence.
c) 1,709,128 notional shares will vest if the share price attains 45 pence.
d) 1,709,128 notional shares will vest if the share price attains 52.5 pence. 
e) 1,709,126 notional shares will vest if the share price attains 60 pence.
The options granted to Paul Foulger will vest if the Company’s mid-market closing share price attains the required price or higher for a 
period of 20 consecutive days at any time during the period commencing on 17 April 2014 and ending on 17 April 2024.
a) one third of the notional shares will vest if the share price attains 50 pence.
b) one third of the notional shares will vest if the share price attains 60 pence.
b) one third of the notional shares will vest if the share price attains 70 pence. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 27
Report on the ﬁ nancial statements
Our opinion
In our opinion:
• the ﬁ nancial statements deﬁ ned below, give a true and fair view of the state of the Group’s and of  the Company’s affairs as at
 31 December 2014 and of the Group’s loss and the Group’s and the Company’s cash ﬂ ows for the year then ended;
• the Group ﬁ nancial statements have been properly prepared in accordance with International Financial Reporting Standards 
 (“IFRSs”)  as adopted by the European Union;
• the Company ﬁ nancial statements have been properly prepared in accordance with International Financial Reporting Standards 
 (“IFRSs”) as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and
• the ﬁ nancial statements have been prepared in accordance with the requirements of the Companies Act 2006.
What we have audited
EKF Diagnostics Holdings plc’s ﬁ nancial statements comprise:
• the consolidated and company’s statements of ﬁ nancial position as at 31 December 2014;
• the consolidated income statement and the consolidated statement of comprehensive income for the year then ended;
• the consolidated and company’s statements of cash ﬂ ows for the year then ended;
• the consolidated and company’s statements of changes in equity for the year then ended; and
• the notes to the ﬁ nancial statements, which include a summary of signiﬁ cant accounting policies and other explanatory information.
The ﬁ nancial reporting framework that has been applied in the preparation of the ﬁ nancial statements is applicable law and IFRSs as 
adopted by the European Union and, as regards the company ﬁ nancial statements, as applied in accordance with the provisions of the 
Companies Act 2006.
In applying the ﬁ nancial reporting framework, the Directors have made a number of subjective judgements, for example in respect of 
signiﬁ cant accounting estimates. In making such estimates, they have made assumptions and considered future events.
Opinion on other matter prescribed by the Companies Act 2006
In our opinion, the information given in the Strategic Report and the Report of the Directors for the ﬁ nancial year for which the ﬁ nancial 
statements are prepared is consistent with the ﬁ nancial statements.
Other matters on which we are required to report by exception
Adequacy of accounting records and information and explanations received
Under the Companies Act 2006 we are required to report to you if, in our opinion:
• we have not received all the information and explanations we require for our audit; or
• adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been received from   
 branches not visited by us; or
• the company ﬁ nancial statements are not in agreement with the accounting records and returns.
We have no exceptions to report arising from this responsibility.
Directors’ remuneration
Under the Companies Act 2006 we are required to report to you if, in our opinion, certain disclosures of Directors’ remuneration 
speciﬁ ed by law are not made. We have no exceptions to report arising from this responsibility.  
Responsibilities for the ﬁ nancial statements and the audit
Our responsibilities and those of the Directors
As explained more fully in the Statement of Directors’ Responsibilities set out on page 22, the Directors are responsible for the 
preparation of the ﬁ nancial statements and for being satisﬁ ed that they give a true and fair view.
Our responsibility is to audit and express an opinion on the ﬁ nancial statements in accordance with applicable law and International 
Standards on Auditing (UK and Ireland) (“ISAs (UK & Ireland)”). Those standards require us to comply with the Auditing Practices 
Board’s Ethical Standards for Auditors.
This report, including the opinions, has been prepared for and only for the Company’s members as a body in accordance with Chapter 3 
of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for 
any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed 
by our prior consent in writing.
Independent Auditors’ Report to the members of 
EKF Diagnostics Holdings plc ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 28
What an audit of ﬁ nancial statements involves 
We conducted our audit in accordance with ISAs (UK & Ireland). An audit involves obtaining evidence about the amounts and 
disclosures in the ﬁ nancial statements sufﬁ cient to give reasonable assurance that the ﬁ nancial statements are free from material 
misstatement, whether caused by fraud or error. This includes an assessment of: 
• whether the accounting policies are appropriate to the Group’s and the Company’s circumstances and have been consistently
applied and adequately disclosed;
• the reasonableness of signiﬁ cant accounting estimates made by the Directors; and
• the overall presentation of the ﬁ nancial statements.
We primarily focus our work in these areas by assessing the Directors’ judgements against available evidence, forming our own 
judgements, and evaluating the disclosures in the ﬁ nancial statements.
We test and examine information, using sampling and other auditing techniques, to the extent we consider necessary to provide 
a reasonable basis for us to draw conclusions. We obtain audit evidence through testing the effectiveness of controls, substantive 
procedures or a combination of both. 
In addition, we read all the ﬁ nancial and non-ﬁ nancial information in the Annual Report to identify material inconsistencies with the 
audited ﬁ nancial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent 
with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements 
or inconsistencies we consider the implications for our report.
Mark Ellis (Senior Statutory Auditor)
for and on behalf of PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
Cardiff
16 March 2015
Independent Auditors’ Report to the members of 
EKF Diagnostics Holdings plc continued EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 29
Consolidated Income Statement
  2014 2013
 Notes £’000 £’000
Continuing operations   
Revenue 5 40,062 31,804 
Cost of sales 6 (20,113) (15,459)
Gross proﬁ t  19,949 16,345 
Administrative expenses 6, 7 (22,793) (14,439)
Other income   371 495 
Operating (loss)/proﬁ t  (2,473) 2,401 
Depreciation and amortisation 5 (4,950) (3,554)
Share-based payment  (512) (709)
Exceptional items 7 (3,268) 1,840 
EBITDA before exceptional items and share-based payment 5 6,257 4,824 
Finance income 12 18 5 
Finance costs 12 (1,573) (1,799)
(Loss)/proﬁ t before income tax  (4,028) 607 
Income tax expense 13 (1,440) (1,500)
Loss for the year  (5,468) (893)
Loss attributable to:   
Owners of the parent  (5,689) (1,126)
Non-controlling interest  221 233 
    (5,468) (893)
  Pence Pence
Loss per Ordinary Share attributable to the owners of the parent during the year   
Basic   
From continuing operations 14 (1.50) (0.41)
Diluted   
From continuing operations 14 (1.50) (0.41)
The notes on pages 35 to 69 are an integral part of these consolidated ﬁ nancial statements.
The Company has elected to take the exemption under section 408 of the Companies Act 2006 not to present the Parent Company 
income statement.
The loss for the Parent Company for the year was £2,882,000 (2013: £1,490,000). ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 30
Consolidated Statement of Comprehensive Income
  2014 2013
 Notes £’000 £’000
Loss for the year  (5,468) (893)
Other comprehensive income:   
Movement on pension scheme 33 48 9
Currency translation differences  546 199
Other comprehensive gain for the year   594 208
Total comprehensive loss for the year   (4,874) (685)
Attributable to:   
Owners of the parent  (4,890) (881)
Non-controlling interests  16 196
Total comprehensive loss for the year   (4,874) (685)
Items stated above are disclosed net of tax. The income tax relating to each component of other comprehensive income is disclosed 
in note 13.
The Company has elected to take the exemption under section 408 of the Companies Act 2006 not to present the parent company 
income statement.
The notes on pages 35 to 69 are an integral part of these consolidated ﬁ nancial statements. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 31
Consolidated and Company’s Statements of Financial Position
  Group Group Company Company 
  2014 2013 2014 2013
 Notes £’000 £’000 £’000 £’000 
Assets
Non-current assets      
Property, plant and equipment  16          10,568  9,785  1,576  1,616
Intangible assets 17          93,522  34,725  -  –
Investments in subsidiaries 18                   -  –  61,043  16,630
Investments 20            1,152  250  1,152  250
Trade and other receivables 22 - –  17,799  17,799
Deferred tax assets 28               238 903  238  96
Total non-current assets   105,480 45,663 81,808 36,391
Current assets     
Inventories 23 5,793 5,308 - –
Trade and other receivables 22 16,115 7,155 18,508 7,275
Deferred tax assets 28 45 46 - –
Cash and cash equivalents 24 8,346 2,551 4,390 159
Total current assets   30,299 15,060 22,898 7,434
Total assets   135,779 60,723 104,706 43,825
Equity attributable to owners of the parent     
Share capital 29 4,221 2,727 4,221 2,727
Share premium account 29 91,276 41,783 91,276 41,783
Other reserve 32 41 41 - –
Foreign currency reserves 32 26 (725) - –
Retained earnings 31 (8,541) (3,412) (9,050) (6,680)
  87,023 40,414 86,447 37,830
Non-controlling interest   353 508 - –
Total equity   87,376 40,922 86,447 37,830
Liabilities
Non-current liabilities     
Borrowings 26 2,492 2,108 - –
Deferred consideration 27 9,536 5,471 3,165 –
Deferred tax liabilities 28 13,258 3,442 - –
Retirement beneﬁ t obligation 33 - 103 - –
Total non-current liabilities   25,286 11,124 3,165 –
Current liabilities     
Trade and other payables 25 7,943 4,189 3,758 4,217
Deferred consideration 27 8,493 1,778 8,493 1,778
Current income tax liabilities  2,171 1,998 - –
Deferred tax liabilities 28 756 380 - –
Borrowings 26 3,754 332 2,843 –
Total current liabilities   23,117 8,677 15,094 5,995
Total liabilities   48,403 19,801 18,259 5,995
Total equity and liabilities   135,779 60,723 104,706 43,825
The notes on pages 35 to 69 are an integral part of these ﬁ nancial statements.
The ﬁ nancial statements were approved and authorised for issue by the Board on 16 March 2015.
Julian Baines        Paul Foulger
Chief Executive Ofﬁ cer        Finance Director
EKF Diagnostics Holdings plc
Registered no: 04347937 ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 32
Consolidated and Company’s Statements of Cash Flows
  Group Group Company Company 
  2014 2013 2014 2013
 Notes £’000 £’000 £’000 £’000 
Cash ﬂ ow from operating activities
Cash (used in)/generated by operations 35 (3,262) 3,172 (12,011) 65
Interest paid  (241) (152) (69) –
Income tax paid  (1,241) (1,013) (21) –
Net cash (used in)/generated by operating activities   (4,744) 2,007 (12,101) 65
Cash ﬂ ow from investing activities     
Purchase of investments  (902) – (902) –
Purchase of property, plant and equipment (PPE)  (1,038) (1,185) (17) (26)
Purchase of intangibles  (1,595) (1,097) - –
Purchase of subsidiaries (net of cash acquired)  (12,379)  (10,248) –
Proceeds from sale of PPE 35 22 61 - –
Interest received  18 5 4 –
Net cash used in investing activities   (15,874) (2,216) (11,163) (26)
Cash ﬂ ow from ﬁ nancing activities     
Proceeds from issuance of Ordinary Shares 29 25,007 – 25,007 –
New bank loans  3,764 477 2,843 –
Repayments on borrowings  (1,855) (439) - –
Dividend payment to non-controlling interest  (171) (169) - –
Payment of deferred consideration  (355) (1,429) (355) (616)
Net cash (used in)/generated by ﬁ nancing activities   26,390 (1,560) 27,495 (616)
Net increase/(decrease) in cash and cash equivalents  5,772 (1,769) 4,231 (577)
Cash and cash equivalents at beginning of year  2,551 4,331 159 736
Exchange gains/(losses) on cash and cash equivalents  23 (11) - –
Cash and cash equivalents at end of year 24 8,346 2,551 4,390 159 EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 33
Consolidated and Company’s Statements of Changes in Equity
  Share  Foreign   Non-
 Share premium Other currency Retained  controlling Total
 capital account reserve reserve earnings Total interest equity
Consolidated £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 
At 1 January 2013 2,671 40,240 – (961) (3,004) 38,946 481 39,427
Comprehensive income        
(Loss)/proﬁ t for the year – – – – (1,126) (1,126) 233 (893)
Other comprehensive income        
Actuarial gain on pension – – – – 9 9 – 9
Currency translation differences – – – 236 – 236 (37) 199
Total comprehensive income – – – 236 (1,117) (881) 196 (685)
Transactions with owners        
Proceeds from shares issued 56 1,543 – – – 1,599 – 1,599
Issue of convertible loan notes in subsidiary – – 41 – – 41 – 41
Dividends to non-controlling interest – – – – – – (169) (169)
Share-based payments – – – – 709 709 – 709
Total contributions by and
  distributions to owners 56 1,543 41 – 709 2,349 (169) 2,180
At 1 January 2014 2,727 41,783 41  (725) (3,412) 40,414 508 40,922
Comprehensive income        
(Loss)/proﬁ t for the year - - - - (5,689) (5,689) 221 (5,468)
Other comprehensive income - - - -
Movement on pension - - - - 48 48 - 48
Currency translation differences - - - 751 - 751 (205) 546
Total comprehensive income - - - 751 (5,641) (4,890) 16 (4,874)
Transactions with owners        
Proceeds from shares issued 1,494 49,493 - - - 50,987 - 50,987
Dividends to non-controlling interest - - - - - - (171) (171)
Share-based payments - - - - 512 512 - 512
Total contributions by and
  distributions to owners 1,494 49,493 - - 512 51,499 (171) 51,328
At 31 December 2014 4,221 91,276 41 26 (8,541) 87,023 353 87,376 ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 34
Consolidated and Company’s Statements of Changes in Equity 
continued
 Share Share Retained
 capital premium earnings Total
Company £’000 £’000 £’000 £’000
At 1 January 2013 2,671 40,240 (5,899) 37,012
Comprehensive income    
Loss for the year – – (1,490) (1,490)
Total comprehensive income – – (1,490) (1,490)
Transactions with owners    
Proceeds from shares issued 56 1,543 – 1,599
Share-based payments – – 709 709
Total contributions by and distributions to owners  56 1,543 709 2,308
At 1 January 2014 2,727 41,783 (6,680) 37,830
Comprehensive income    
Loss for the year - - (2,882) (2,882)
Total comprehensive income - - (2,882) (2,882)
Transactions with owners    
Proceeds from shares issued 1,494 49,493 - 50,987
Share-based payments - - 512 512
Total contributions by and distributions to owners  1,494 49,493 512 51,499
At 31 December 2014 4,221 91,276 (9,050) 86,447 EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 35
Notes to the Financial Statements for the year ended 31 December 2014
1. General information
EKF Diagnostics Holdings Plc is a company incorporated and domiciled in the United Kingdom. The Company is a public limited 
company, which is listed on the AIM market of the London Stock Exchange. The address of the registered ofﬁ ce is Avon House, 
19 Stanwell Road, Penarth, Cardiff CF64 2EZ.
The principal activity of the Group continued to be the development, manufacture and supply of products and services into the 
in-vitro diagnostic (IVD) market place, including the molecular diagnostics sector. The Group has presence in the UK, USA, Germany, 
Poland, Russia, China, and Ireland, and sells throughout the world including Europe, the Americas, Asia, and Africa.
The ﬁ nancial statements are presented in British Pounds Sterling, the currency of the primary economic environment in which the 
Company’s headquarters is operated. The Group comprises EKF Diagnostics Holdings plc and its subsidiary Companies as set out in 
note 18.
The registered number of the Company is 04347937.
2. Summary of signiﬁ cant accounting policies
The principal accounting policies applied in the preparation of these consolidated ﬁ nancial statements are set out below. The policies 
have been consistently applied throughout the year, unless otherwise stated.
Basis of preparation
The consolidated ﬁ nancial statements of EKF Diagnostics Holdings plc have been prepared in accordance with International Financial 
Reporting Standards as adopted by the European Union (IFRS’s), IFRIC interpretations and the Companies Act 2006 applicable to 
companies reporting under IFRS. Practice is continuing to evolve on the application and interpretations of IFRS.
The consolidated ﬁ nancial statements have been prepared under the historical cost convention, as modiﬁ ed by the revaluation of 
available-for-sale assets at fair value through proﬁ t or loss and certain ﬁ nancial liabilities at fair value through proﬁ t and loss.
The preparation of ﬁ nancial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also 
requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a 
higher degree of judgement or complexity, or areas where assumptions and estimates are signiﬁ cant to the consolidated ﬁ nancial 
statements are disclosed in note 4.
(a) Standards, amendments and interpretations effective in 2014
The following new IFRS pronouncements relevant to the Group have been adopted in these ﬁ nancial statements:
 • Amendments to IAS 32: ‘Financial instruments: Presentation’ related to offsetting ﬁ nancial assets and ﬁ nancial liabilities
 • Amendments to IAS 36: ‘Impairment’ related to recoverable amount disclosures for non-ﬁ nancial assets
None of the above amendments have had a material impact on the Group consolidated ﬁ nancial statements.
(b) Standards, amendments and interpretations to existing standards that are not yet effective and have not been adopted early by
  the group.
The following new standards, amendments to standards and interpretations have been issued, but are not effective for the ﬁ nancial 
year beginning 1 January 2014 and have not been early adopted: 
 • IFRS 9: ‘Financial instruments’ 
 • IFRS 15: ‘Revenue from contracts with customers’ 
 • Amendments to IFRS 11: ‘Joint arrangements’ related to the acquisition of interests in joint operations and the sale or 
        contribution of assets between an investor and its associate or joint venture 
 • IAS 1: ‘Presentation of ﬁ nancial statements’. 
 • Amendment to IAS 16: ‘Property, plant and equipment’ and IAS 38: ‘Intangible assets’ related to the clariﬁ cation of acceptable 
        methods of depreciation and amortisation 
 • Annual Improvement Project 2010-2012, 2011-2013 & 2012-2014 
 • Amendment to IAS 19: ‘Employee beneﬁ ts’ related to employee contributions to deﬁ ned beneﬁ t plans. 
 • Amendment to IAS 27: ‘Separate ﬁ nancial statements’
The Directors do not anticipate that the application of the Annual Improvement Projects and the Amendments to IAS 1, IAS 16, IAS 19, 
IAS 27, IAS 38 and IFRS 11 will have a material impact on the amounts reported and disclosed.
The Group is currently in the process of assessing the impact of IFRS 9 and IFRS 15 and it is currently too early to conclude what 
impact these standards will have as a detailed impact assessment is required and therefore it is not practicable to provide a 
quantiﬁ ed estimate of the effects of IFRS 9 and IFRS 15. This will be provided once the Group has completed the detailed reviews.
Going concern
The Group meets its day-to-day working capital requirements through the use of cash reserves and existing bank facilities. The 
Group has maintained its liquidity proﬁ le through the year.
The Directors have considered the applicability of the going concern basis in the preparation of these ﬁ nancial statements. This 
included the review of internal budgets and ﬁ nancial results which show, taking into account reasonably probable changes in 
ﬁ nancial performance, that the Group should be able to operate within the level of its current funding arrangements.
The Directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operation for 
the foreseeable future. For this reason they have adopted the going concern basis in the preparation of the ﬁ nancial statements. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 36
Notes to the Financial Statements continued
for the year ended 31 December 2014
2. Summary of signiﬁ cant accounting policies continued
Basis of consolidation
The consolidated ﬁ nancial statements incorporate the ﬁ nancial statements of the Company and its subsidiary undertakings. 
Subsidiaries are all entities over which the Group has the power to govern their ﬁ nancial and operating policies generally 
accompanying a shareholding of more than ﬁ fty per cent of the voting rights. The existence and effect of potential voting 
rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. 
Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the 
date that control ceases.
The Group uses the acquisition method of accounting to account for business combinations. The consideration transferred for 
the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred and the equity interests issued by 
the Group. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration 
agreement. Acquisition related costs are expensed as incurred. Identiﬁ able assets acquired and liabilities and contingent liabilities 
assumed in a business combination are measured initially at their fair values at the acquisition date. On an acquisition by acquisition 
basis, the Group recognises any non-controlling interest in the acquiree either at fair value or at the non-controlling interest’s 
proportionate share of the acquiree’s net assets.
The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition date fair 
value of any previous equity interest in the acquiree over the fair value of the Group’s share of the identiﬁ able net assets acquired is 
recorded as goodwill. If this is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase, 
the difference is recognised directly in the income statement.
Investments in subsidiaries are accounted for at cost less impairment.
Inter-Company transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised 
losses are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the 
policies adopted by the Group.
Foreign currency translation
(a) Functional and presentational currency
Items included in the ﬁ nancial statements of each of the Group’s entities are measured using the currency of the primary economic 
environment in which the entity operates (the functional currency). The consolidated ﬁ nancial statements are presented in British 
Pounds Sterling, which is the Company’s functional and presentational currency.
(b) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the 
transactions where items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and 
from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised 
in the income statement within ‘administrative expenses’.
(c) Group companies
The results and ﬁ nancial position of all the Group entities (none of which has the currency of a hyper-inﬂ ationary economy) that have 
a functional currency different from the presentational currency are translated into the presentational currency as follows:
 • assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet;
 • income and expenses for each income statement are translated at average exchange rates; and
 • all resulting exchange differences are recognised in other comprehensive income.
On consolidation, exchange differences arising from the translation of the net investment in foreign operations are taken to other 
comprehensive income. When a foreign operation is partially disposed of or sold, exchange differences that were recorded in equity 
are recognised in the income statement as part of the gain or loss on sale.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign 
entity and translated at the closing rate.
Segmental reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating 
decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the 
operating segments, has been identiﬁ ed as the Executive Directors who make strategic decisions.
Government grants
Government grants receivable in connection with expenditure on property, plant and equipment are accounted for as deferred 
income, which is credited to the income statement over the expected useful economic life of the related assets, on a basis consistent 
with the depreciation policy. Revenue grants for the reimbursement of costs charged to the income statement are credited to the 
Income Statement in the year in which the costs are incurred.
Property, plant and equipment
Property, plant and equipment are stated at historical cost less accumulated depreciation and any provision for impairment. 
Historical cost includes expenditure that is directly attributable to the acquisition of the asset and bringing the asset to its working 
condition for its intended use.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only where it is 
probable that future economic beneﬁ ts associated with the asset will ﬂ ow to the Group and the cost of the asset can be measured 
reliably. The carrying amount of the replaced part is derecognised. All other repairs and maintenance are charged to the income 
statement during the ﬁ nancial period in which they are incurred. Any borrowing costs associated with qualifying property plant and 
equipment are capitalised and depreciated at the rate applicable to that asset category. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 37
Land is not depreciated. Depreciation on other assets is calculated using the straight-line method or reducing balances method to 
allocate their cost to its residual values over their estimated useful lives, as follows:
Buildings 2%–2.5%
Fixtures and ﬁ ttings 20%–25%
Plant and machinery 20%–33.3%
Motor vehicles 25%
The assets’ residual values and useful economic lives are reviewed regularly and adjusted if appropriate, at the end of each 
reporting period.
An asset’s carrying value is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its 
estimated recoverable amount.
Gains and losses on the disposal of assets are determined by comparing the proceeds with the carrying amount and are recognised 
in administration expenses in the income statement.
Intangible assets
(a) Goodwill
Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net identiﬁ able assets 
of the acquired subsidiary at the date of the acquisition. Goodwill on acquisitions of subsidiaries is included in ‘intangible assets’. 
Goodwill has an inﬁ nite useful life and is tested annually for impairment and carried at cost less accumulated impairment losses. 
Impairment losses on goodwill are not reversed. Gains and losses on the disposal of an entity include the carrying amount of goodwill 
relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating 
units or groups of cash-generating units that are expected to beneﬁ t from the business combination in which the goodwill arose, 
identiﬁ ed according to operating segment.
(b) Trademarks, trade names and licences
Separately acquired trademarks and licences are shown at historical cost. Trademarks and licences acquired in a business 
combination are recognised at fair value at the acquisition date. Trademarks and licences have a ﬁ nite useful life and are carried 
at cost less accumulated amortisation. Amortisation is calculated using the straight-line method to allocate the cost of trademarks 
and licences over their estimated useful lives of between 8 and 12 years and is charged to administrative expenses in the income 
statement.
(c) Customer relationships
Contractual customer relationships acquired in a business combination are recognised at fair value at the acquisition date. The 
contractual customer relationships have a ﬁ nite useful life and are carried at cost less accumulated amortisation. Amortisation is 
calculated using the straight-line method over the expected life of the customer relationship of between 6 and 15 years and is 
charged to administrative expenses in the income statement.
(d) Trade secrets
Trade secrets, including technical know-how, operating procedures, methods and processes, acquired in a business combination are 
recognised at fair value at the acquisition date. Trade secrets have a ﬁ nite useful life and are carried at cost less accumulated 
amortisation. Amortisation is calculated using the straight-line method to allocate the cost of trade secrets over their estimated 
useful lives of between 6 and 15 years and is charged to administrative expenses in the income statement.
(e) Development costs
Development costs acquired in a business combination are recognised at fair value at the acquisition date. Development costs have a 
ﬁ nite useful life and are carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line method over 
their estimated useful lives of 15 years and is charged to administrative expenses in the income statement.
Expenditure incurred on the development of new or substantially improved products or processes is capitalised, provided that the 
related project satisﬁ es the criteria for capitalisation, including the project’s technical feasibility and likely commercial beneﬁ t. All 
other research and development costs are expensed as incurred.
Development costs are amortised over the estimated useful life of the products with which they are associated. Amortisation 
commences when a new product is in commercial production. The amortisation is charged to administrative expenses in the income 
statement. The estimated remaining useful lives of development costs are reviewed at least on an annual basis.
The carrying value of capitalised development costs is reviewed for potential impairment at least annually and if a product becomes 
unviable and an impairment is identiﬁ ed the deferred development costs are immediately charged to the income statement.
(f) Non-compete agreements
Non-compete agreements arising from a business combination are recognised at fair value at the acquisition date. Non-compete 
agreements have a ﬁ nite life and are carried at cost less accumulated amortisation. Amortisation is calculated using the straight-line 
method to allocate the cost of non-compete agreements over their estimated useful lives of three years and is charged to 
administrative expenses in the income statement. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 38
2. Summary of signiﬁ cant accounting policies continued
Impairment of non-ﬁ nancial assets
Assets that have an indeﬁ nite life such as goodwill are not subject to amortisation and are tested annually for impairment. Assets 
that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying 
amount may not be recoverable. An impairment loss is recognised for the amount by which the carrying amount exceeds its 
recoverable amount.
The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. In assessing value in use, the estimated 
future cash ﬂ ows are discounted to their present value using a pre-tax discount rate that reﬂ ects current market assessments of the 
time value of the money and the risks speciﬁ c to the asset for which the estimates of future cash ﬂ ows have not been adjusted.
For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identiﬁ able cash 
ﬂ ows. Impairment losses recognised for cash-generating units, to which goodwill has been allocated, are credited initially to the 
carrying amount of goodwill. Any remaining impairment loss is charged pro rata to the other assets in the cash-generating unit.
Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised 
estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have 
been determined had no impairment loss been recognised for the asset (cash-generating unit) in the prior period. A reversal of an 
impairment loss is recognised in the income statement immediately. If goodwill is impaired however, no reversal of the impairment is 
recognised in the ﬁ nancial statements.
Investments 
Investments where the Group does not have a controlling interest are initially recognised at cost. The carrying value is tested 
annually for impairment and an impairment loss is recognised for the amount by which the carrying amount exceeds its 
recoverable amount.
Financial assets
Classiﬁ cation
The Company classiﬁ es its ﬁ nancial assets in the following categories: loans and receivables and available-for-sale ﬁ nancial 
assets. The classiﬁ cation depends on the purpose for which the ﬁ nancial assets were acquired and management determines the 
classiﬁ cation of its ﬁ nancial assets at initial recognition.
(a) Loans and receivables
Loans and receivables are non-derivative ﬁ nancial assets with ﬁ xed or determinable payments that are not quoted in an active 
market. They are included in current assets, except for maturities greater than 12 months after the balance sheet date. These are 
classiﬁ ed as non-current assets. The Company’s loans and receivables comprise ‘trade and other receivables’ and cash and cash 
equivalents in the balance sheet.
(b) Available-for-sale ﬁ nancial assets
Available-for-sale assets are non-derivatives that are either designated in this category or not classiﬁ ed as loans and receivables. 
They are included in non-current assets unless the investment matures or management intends to dispose of it within 12 months of 
the end of the reporting period.
Recognition and measurement
Regular purchases and sales of ﬁ nancial assets are recognised on the trade date – the date on which the Company commits to 
purchase the asset. Assets are initially recognised at fair value plus transaction costs. Financial assets are derecognised when the risk 
and rewards of ownership have been transferred.
Loans and receivables are subsequently carried at amortised cost using the effective interest rate method.
Available-for-sale ﬁ nancial assets are subsequently carried at fair value. Gains and losses arising from changes in fair value are 
recognised in other comprehensive income until the asset is disposed at which time the cumulative gain or loss previously 
recognised in equity is included in the consolidated income statement for the period. If an available-for-sale investment is determined 
to be impaired, the cumulative loss previously recognised in equity is included in the income statement for the period.
Inventories
Inventories and work in progress are stated at the lower of cost and net realisable value. Cost is calculated on a ﬁ rst in and ﬁ rst out 
basis and includes raw materials, direct labour, other direct costs and attributable production overheads, where appropriate. Net 
realisable value represents the estimated selling price less all estimated costs of completion and applicable selling costs. Where 
necessary, provision is made for slow-moving and obsolete inventory. Inventory on consignment and their related obligations are 
recognised in current assets and payables respectively.
Trade and other receivables
Trade receivables are initially recognised at fair value, being the original invoice amount, and subsequently measured at amortised 
cost less provision for impairment. A provision for impairment is established when there is objective evidence that the Group will not 
be able to collect all amounts due according to the original terms of the receivable. Trade receivables that are less than three months 
past due are not considered impaired unless there are speciﬁ c ﬁ nancial or commercial reasons that lead management to conclude 
that the customer will default. Older debts are considered to be impaired unless there is sufﬁ cient evidence to the contrary that 
they will be settled. The amount of the provision is the difference between the asset’s carrying value and the present value of the 
estimated future cash ﬂ ows. The carrying amount of the asset is reduced through the use of an allowance account, and the amount 
of the loss is recognised in the income statement within administrative expenses. When a trade receivable is uncollectible it is written 
off against the allowance account. Subsequent recoveries of amounts previously written off are credited against administrative 
expenses in the income statement.
Notes to the Financial Statements continued
for the year ended 31 December 2014 EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 39
Cash and cash equivalents
Cash and short-term deposits in the balance sheet comprise cash at bank and in hand and short-term deposits with an original 
maturity of less than three months, reduced by overdrafts to the extent that there is a right of offset against other cash balances.
For the purposes of the consolidated cash ﬂ ow statement, cash and cash equivalents consist of cash and short-term deposits as 
deﬁ ned above net of outstanding bank overdrafts where there is a right of offset.
Share capital
Ordinary Shares are classiﬁ ed as equity. Proceeds in excess of the nominal value of shares issued are allocated to the share premium 
account and are also classiﬁ ed as equity. Incremental costs directly attributable to the issue of new Ordinary Shares or options are 
deducted from the share premium account.
Financial liabilities
Debt is measured at fair value, being net proceeds after deduction of directly attributable issue costs, with subsequent measurement 
at amortised cost with the exception of deferred equity consideration which is categorised as a ﬁ nancial liability at fair value through 
proﬁ t and loss. Debt issue costs are recognised in the income statement over the expected term of such instruments at a constant 
rate on the carrying amount.
Trade and other payables
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from 
suppliers. Accounts payable are classiﬁ ed as current liabilities if payment is due within one year or less (or in the normal operating 
cycle of the business if longer). If not, they are presented as non-current liabilities. Trade payables are recognised initially at fair value 
and subsequently measured at amortised cost using the effective interest method.
Borrowings
Borrowings are recognised initially at the fair value of proceeds received, net of transaction costs incurred. Borrowings are 
subsequently carried at amortised cost. Borrowings are classiﬁ ed as current liabilities unless the Group has an unconditional right to 
defer settlement of the liability for at least 12 months after the balance sheet date.
Borrowing costs are expensed in the consolidated Group income statement under the heading ‘ﬁ nance costs’. Arrangement and 
facility fees together with bank charges are charged to the income statement under the heading ‘administrative expenses’.
Current and deferred income tax
The tax expense comprises current and deferred tax. Tax is recognised in the income statement, except to the extent that it relates 
to items recognised in other comprehensive income where the associated tax is also recognised in other comprehensive income.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date 
in the countries where the Company and its subsidiaries operate and generate taxable income. Management evaluates positions 
taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and establishes provisions 
where appropriate on the basis of amounts expected to be paid to the tax authorities.
Deferred tax is recognised, using the liability method, on all temporary differences at the balance sheet date between the tax 
bases of assets and liabilities and their carrying amounts for ﬁ nancial reporting purposes. Deferred tax liabilities are recognised 
in respect of all temporary differences except where the deferred tax liability arises from the initial recognition of goodwill in 
business combinations.
Deferred tax assets are recognised for all deductible temporary differences, carry-forward of unused tax assets and tax losses, to the 
extent that they are regarded as recoverable. They are regarded as recoverable where, on the basis of available evidence, there will 
be sufﬁ cient taxable proﬁ ts against which the future reversal of the underlying temporary differences can be deducted.
The carrying value of the amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no 
longer probable that sufﬁ cient taxable proﬁ t will be available to allow all, or part, of the tax asset to be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or 
the liability is settled, based on the tax rates (and tax laws) that have been substantively enacted at the balance sheet date.
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against 
current tax liabilities and when the deferred income tax assets and liabilities relate to income taxes levied by the same taxation 
authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.
Provisions
Provisions for legal claims are recognised when the Group has a present legal or constructive obligation as a result of a past event 
and it is probable that an outﬂ ow of resources will be required to settle the obligation and the amount can be reliably measured.
Leases
Leases which transfer substantially all the risks and rewards of ownership of an asset are treated as a ﬁ nance lease. Assets held 
under ﬁ nance leases are capitalised at their fair value at the inception of the lease and depreciated over the estimated useful 
economic life of the asset or lease term if shorter. The ﬁ nance charges are allocated to the income statement in proportion to the 
capital amount outstanding.
All other leases are classiﬁ ed as operating leases. Operating lease rentals are charged to the income statement in equal annual 
amounts over the lease term.
Deferred consideration
Deferred consideration is recognised at fair value. Where the value of deferred consideration is based on a future event, management 
estimate the likelihood of the consideration becoming payable. Deferred consideration is discounted to take account of the time 
value of money at rates based on those used for the valuation of related intangible assets. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 40
2. Summary of signiﬁ cant accounting policies continued
Employee beneﬁ ts
(a) Pension obligations
Group companies operate various pension schemes and have both deﬁ ned beneﬁ t and deﬁ ned contribution plans. A deﬁ ned 
contribution plan is a pension plan under which the Group pays ﬁ xed contributions into a separate entity with the pension cost 
charged to the income statement as incurred. The Group has no further obligations once the contributions have been paid.
Under a deﬁ ned beneﬁ t scheme, the amount of retirement beneﬁ t that will be received by an employee is deﬁ ned with respect 
to periods of service and ﬁ nal salary. The amount recognised in the balance sheet is the difference between the present value of 
the deﬁ ned beneﬁ t obligation at the balance sheet date and the fair value of the scheme assets. The deﬁ ned beneﬁ t obligation 
is calculated annually by independent actuaries using the projected unit credit method. The present value of the deﬁ ned beneﬁ t 
obligation is determined by discounting the estimated future cash outﬂ ows.
Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged or credited in other 
comprehensive income in the period in which they arise.
The service cost of providing retirement beneﬁ ts to employees during the year is charged to operating proﬁ t. Past service costs are 
recognised immediately in income, unless the changes to the pension plan are conditional on the employees remaining in service 
for a speciﬁ ed period of time (the vesting period). In this case, the past service costs are amortised on a straight-line basis over the 
average vesting period.
(b) Share-based compensation
The Group operates a number of equity-settled, share-based compensation plans, under which the Group receives services from 
employees as consideration for equity instruments of the Group. Equity-settled share-based payments are measured at fair value 
at the date of grant and are expensed over the vesting period based on the number of instruments that are expected to vest. 
For plans where vesting conditions are based on share price targets, the fair value at the date of grant reﬂ ects these conditions. 
Where applicable the Group recognises the impact of revisions to original estimates in the income statement, with a corresponding 
adjustment to equity for equity-settled schemes. Fair values are measured using appropriate valuation models, taking into account 
the terms and conditions of the awards.
When the share-based payment awards are exercised, the Company issues new shares. The proceeds received net of any directly 
attributable transaction costs are credited to share capital (nominal value) and share premium.
National insurance on share options
To the extent that the share price at the balance sheet date is greater than the exercise price on options granted under unapproved 
share-based payment compensation schemes, provision for any National Insurance Contributions has been based on the prevailing 
rate of National Insurance. The provision is accrued over the performance period attaching to the award.
Revenue recognition
(a) Sale of goods
Revenue for the sale of medical diagnostic instruments and reagents is measured at the fair value of the consideration received or 
receivable and represents the invoiced value for the sale of the goods and services net of sales taxes, rebates and discounts. Revenue 
from the sale of goods is recognised when a Group Company has delivered products to the customer, the customer has accepted 
delivery of the products and collectability of the related receivables is reasonably assured.
(b) Sale of services
Revenue for the sale of molecular diagnostic testing services is recognised when the test has been completed and the results 
returned to the patient. Billing is carried out by the Group directly or through third party billing agencies. Sales commissions to third 
parties are recognised at the same time as revenue is recognised and accrued until due for payment.
(c) Interest income
Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, 
which is the rate that exactly discounts estimated future cash receipts through the expected life of the ﬁ nancial asset to that asset’s 
net carrying amount.
(d) Royalty and licence income
Royalty and licence income is recognised on an accruals basis in accordance with the substance of the relevant agreements.
Dividend distribution
Dividend distributions to the Company’s Shareholders are recognised as a liability in the Group’s ﬁ nancial statements in the period in 
which the dividends are approved by the Company’s Shareholders. Interim dividends are recognised when paid.
Other income
Other income includes grant income and R & D tax credits passed through income where this is permitted by the relevant jurisdiction.
Exceptional items
These are items of an unusual or non-recurring nature incurred by the Group and include transactional costs and one off items 
relating to business combinations, such as acquisition expenses.
3. Financial risk management
Financial risk factors
The Group’s activities expose it to a variety of ﬁ nancial risks: market risk (foreign exchange risk and cash ﬂ ow interest rate 
risk), credit risk, liquidity risk, capital risk and fair value risk. The Group’s overall risk management programme focuses on the 
unpredictability of the ﬁ nancial markets and seeks to minimise the potential adverse effects on the Group’s ﬁ nancial performance. 
The Group does not use derivative ﬁ nancial instruments to hedge risk exposures.
Notes to the Financial Statements continued
for the year ended 31 December 2014 EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 41
Risk management is carried out by the head ofﬁ ce ﬁ nance team. It evaluates and mitigates ﬁ nancial risks in close co-operation with the 
Group’s operating units. The Board provides principles for overall risk management whilst the head ofﬁ ce ﬁ nance team provides speciﬁ c 
policy guidance for the operating units in terms of managing foreign exchange risk, credit risk and cash and liquidity management.
(a) Market risk
(i) Foreign exchange – cash ﬂ ow risk
The Group’s presentational currency is sterling although it operates internationally and is exposed to foreign exchange risk arising 
from various currency exposures, primarily between GBP, USD, the Euro, Rouble, and Zloty such that the Group’s cash ﬂ ows are 
affected by ﬂ uctuations in the rate of exchange between GBP and the aforementioned foreign currencies.
This exposure is managed by a natural currency hedge as the Group’s operating subsidiaries cost base is also denominated in USDs, 
Euros, Roubles, and Zloty as the Group has subsidiary businesses located in the USA, Germany, Ireland, Russia, and Poland.
Management do not use derivative ﬁ nancial instruments to mitigate the impact of any residual foreign currency exposure not 
mitigated by the natural hedge within the business model. The Group does not speculate in foreign currencies and no operating 
Company is permitted to take unmatched positions in any foreign currency.
(ii) Foreign exchange – Fair value risk
Translation exposures that arise on converting the results of overseas subsidiaries are not hedged. Net assets held in foreign 
currencies are hedged wherever practical by matching borrowings in the same currency. The principal exchange rates used by the 
Group in translating overseas proﬁ ts and net assets into GBP are set out in the table below.
   Average Average Year end Year end
   rate rate rate rate
Rate compared to GBP 2014 2103 2014 2013
Euro 1.244 1.183 1.287 1.203
Russian Rouble 64.048 50.155 91.264 54.500
Polish Zloty 5.206 4.959 5.465 4.983
US Dollar 1.647 1.572 1.559 1.657
As a guide to the sensitivity of the Group’s results to movements in foreign currency exchange rates, a one cent movement in the 
Euro and US Dollars to Sterling rate would impact annual earnings by approximately £26,000 and £33,000 respectively.
(iii) Cash ﬂ ow and fair value interest rate risk
The Group has interest-bearing assets in the form of cash and cash equivalents and limited interest-bearing liabilities which relate 
to long-term borrowing and ﬁ nance lease obligations in the Group’s US and German subsidiaries. Interest rates on cash and cash 
equivalents are ﬂ oating whilst interest rates on borrowings have been ﬁ xed and therefore expose the Group to fair value interest rate 
risk. The Group does not speculate on future changes in interest rates.
Where overseas acquisitions are made, it is the Group’s policy to arrange any borrowings required in local currency.
It is the Group’s policy not to trade in ﬁ nancial instruments. The Group does not use interest rate swaps.
(b) Credit risk
Credit risk is managed on a Group basis, except for credit risk relating to accounts receivable balances. Each local subsidiary and 
operating business unit is responsible for managing and analysing the credit risk for each of their new clients before standard 
payment and delivery terms and conditions are offered. It is the Group policy to obtain deposits from customers where possible, 
particularly overseas customers. In addition if possible the Group will seek conﬁ rmed letters of credit for the balances due. Credit risk 
is managed at the operating business unit level and monitored at the Group level to ensure adherence to Group policies. If there is 
no independent rating, local management assesses the credit quality of the customer, taking into account its ﬁ nancial position, past 
experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the 
Board. The utilisation of credit limits is regularly monitored. Where extended credit is granted, this is agreed by the Finance Director.
Credit risk also arises from cash and cash equivalents, derivative ﬁ nancial instruments and deposits with banks and ﬁ nancial 
institutions, as well as credit exposures to customers.
(c) Liquidity risk
Cash ﬂ ow forecasting is performed in the individual operating entities of the Group and is aggregated by Group ﬁ nance. Group 
ﬁ nance monitors cash and cash ﬂ ow forecasts and it is the Group’s liquidity risk management policy to maintain sufﬁ cient cash and 
available funding through an adequate amount of cash and cash equivalents and committed credit facilities from its bankers. Due 
to the dynamic nature of the underlying businesses, the head ofﬁ ce ﬁ nance team aims to maintain ﬂ exibility in funding by keeping 
sufﬁ cient cash and cash equivalents available to fund the requirements of the Group.
The Group’s policy in relation to the ﬁ nance of its overseas operations requires that sufﬁ cient liquid funds be maintained in each of its 
territory subsidiaries to support short and medium-term operational plans. Where necessary, short-term funding is provided by the 
holding Company. In the UK, the working capital bank facility and the management of liquid funds in excess of operational needs are 
controlled centrally. Typically excess funds are placed as short-term deposits, to provide a balance between interest earnings and 
ﬂ exibility.
The table overleaf analyses the Group’s non-derivative ﬁ nancial liabilities into relevant maturity groupings based on the remaining 
period at the balance sheet date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted 
cash ﬂ ows. In the case of deferred consideration the amount shown as payable between 2 and 5 years for 31 December 2014 is the total 
gross contractual liability should all performance criteria be met, not the estimated liability based on current and forecast performance. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 42
3. Financial risk management continued
   Less than Between Between More than
   one year 1 and 2 years 2 and 5 years 5 years Total
   £’000 £’000 £’000 £’000 £’000
At 31 December 2014:     
Borrowings (inc. ﬁ nance leases) 3,862 343 709 1,576 6,490
Deferred consideration  1,425 3,943 1,522 5,101 11,991
Trade and other payables 7,731 - - - 7,731
At 31 December 2013:     
Borrowings (inc. ﬁ nance leases) 348 268 797 1,220 2,633
Deferred consideration  430 – 7,216 3,198 10,844
Trade and other payables 4,023 – – – 4,023
(d) Capital risk management
The Group’s objectives when managing capital are to safeguard the ability to continue as a going concern in order to provide returns 
for shareholders and beneﬁ ts for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.
The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt 
is calculated as total borrowings (including “current and non-current borrowings” as shown in the consolidated balance sheet) less 
cash and cash equivalents. Total capital is the sum of net debt plus equity.
The Group is currently largely un-geared, having net cash at 31 December 2014. It is the stated strategy of the Group to grow both 
organically and through acquisition with acquisitions to be funded through a mixture of debt and equity funding.
(e) Fair value estimation
The Group has no Level 1, 2 or 3 classiﬁ ed ﬁ nancial assets as at 31 December 2014 (2013: none).
4. Critical accounting estimates and judgements
In the process of applying the Group’s accounting policies, management has made accounting judgements in the determination of 
the carrying value of certain assets and liabilities. Due to the inherent uncertainty involved in making assumptions and estimates, 
actual outcomes will differ from those assumptions and estimates. The following judgements have the most signiﬁ cant effect on the 
amounts recognised in the ﬁ nancial statements.
(a) Business combinations
The recognition of business combinations requires the excess of the purchase price of acquisitions over the net book value of assets 
acquired to be allocated to the assets and liabilities of the acquired entity. The Group makes judgements and estimates in relation to 
the fair value allocation of the purchase price. If any unallocated portion is positive it is recognised as goodwill.
(i) Goodwill
The amount of goodwill initially recognised as a result of a business combination is dependent on the allocation of the purchase price 
to the fair value of the identiﬁ able assets acquired and the liabilities assumed. The determination of the fair value of the assets and 
liabilities is based, to a considerable extent, on management’s judgement.
Allocation of the purchase price affects the results of the Group as ﬁ nite lived intangible assets are amortised, whereas indeﬁ nite 
lived intangible assets, including goodwill, are not amortised and could result in differing amortisation charges based on the 
allocation to indeﬁ nite lived and ﬁ nite lived intangible assets.
(ii) Finite lived intangible assets
Finite lived intangible assets include trade secrets and non-compete agreements acquired as part of business combinations. The fair 
value of these separately identiﬁ able assets is determined by discounting estimated future net cash ﬂ ows generated by the asset. 
The use of different assumptions for the expectations of future cash ﬂ ows and the discount rate would change the valuation of the 
intangible assets. The relative size of the Group’s intangible assets, excluding goodwill, makes the judgements surrounding the 
estimated useful lives critical to the Group’s ﬁ nancial position and performance.  When assessing the fair value of EKF Molecular 
Diagnostics and Selah Genomics, the Group has assumed revenue growth levels which are above industry averages because of the 
high growth markets in which these units operate, and the relatively early stage of their development.
(iii) Deferred consideration
In some business combinations the purchase price includes deferred consideration which is contingent on future events. The fair 
value of the deferred consideration is determined by discounting estimated future outﬂ ows which are based on management’s 
judgement of the likelihood and timing of future events. The deferred consideration in respect of Selah Genomics, which is based on 
the achievement of quarterly revenue targets, has been determined by assuming Selah achieves the required revenue pattern after 
the ﬁ rst year of ownership.
(b) Impairment of goodwill
The Group tests annually whether goodwill has suffered any impairment, in accordance with the accounting policy stated in note 
2. The recoverable amounts of cash-generating units have been determined based on value-in-use calculations. These calculations 
require the use of estimates as set out in note 17.
(c) Share-based payments
A number of accounting estimates and judgements are incorporated within the calculation of the charge to the income statement in 
respect of share-based payments. These are described in more detail in note 30.
Notes to the Financial Statements continued
for the year ended 31 December 2014 EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 43
(d) Impairment of receivables
Trade and other receivables are carried at the contractual amount due less any estimated provision for non-recovery. Provision is 
made based on a number of factors including the age of the receivable, previous collection experience and the ﬁ nancial 
circumstances of the counterparty.
The Group has receivables outstanding at year end from certain customers in Mexico totalling $10.2m (£6.5m) some of which are 
overdue for payment. Settlement has been delayed because payments to the Group’s Mexican customers have themselves been 
delayed. The receivables balance has not been impaired because management judge that the outstanding amounts will be settled in 
full. Of the outstanding balance £5.5m is overdue for payment.
(e) Deferred tax assets
Deferred tax assets are only recognised to the extent that it is probable that future taxable proﬁ ts will be available against which 
deductible temporary differences can be utilised. A deferred tax asset in respect of tax losses relating to the Company has not been 
recognised as insufﬁ cient future taxable proﬁ t in the Company is currently forecast. A deferred tax asset has not been recognised 
in respect of the historic losses within the Group’s Irish business as the business is being transferred to other parts of the Group and 
the goodwill, trade secrets and capitalised development costs relating to the Renastat development at the Irish business have been 
impaired. The carrying amount of deferred tax assets at the balance sheet date was £283,000 (2013: £949,000). In addition there 
were £1,141,000 (2013: £872,000) of deferred tax assets not recognised.
(f) Tax warranties
The Group has been advised by its German tax advisers that there is a potential tax and associated interest liability associated with 
the EKF-diagnostic GmbH business prior to acquisition, of up to ¤1.19m (£0.93m). Under the warranties of the acquisition agreement 
EKF has already withheld payment of part of the deferred consideration to cover such liability. The warranty claim effect has reduced 
as a result of review of the potential liability with the Group’s tax advisers and the German tax authorities. The reduction of the 
potential claim is included within administration costs and has been disclosed as an exceptional item. The determination of both the 
total tax and interest potentially payable, and the related warranty claim, are based on management judgement.
5. Segmental reporting
Management has determined the Group’s operating segments based on the monthly management reports presented to the Chief 
Operating Decision Maker (‘CODM’). The CODM is the Executive Directors and the monthly management reports are used by the 
Group to make strategic decisions and allocate resources.
The principal activity of the Group is the design, development, manufacture and selling of diagnostic instruments, reagents and 
certain ancillary products. This activity takes place across various countries, such as the USA, Germany, Poland, Russia, United 
Kingdom and Ireland, and as such the Board considers the business primarily from a geographic perspective. Although not all the 
segments meet the quantitative thresholds required by IFRS 8, management has concluded that all segments should be maintained 
and reported, given potential future growth of the segments. In 2015 a new matrix structure for revenue based partly on disease 
states will be introduced and this structure will be reﬂ ected in the segmental analysis in future years.
The reportable segments derive their revenue primarily from the manufacture and sale of medical diagnostic equipment. Other 
services include the servicing and distribution of third party company products under separate distribution agreements, and the 
supply of molecular diagnostic testing services.
Currently the key operating performance measures used by the CODM are Revenue and adjusted EBITDA. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 44
 Germany UK USA Ireland Poland Russia Other Total
2014 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 
Income statement        
Revenue 15,520  2,539  24,499  373  1,770  3,162  1,738  49,601 
Inter-segment  (7,297)  (1,848)  (29)   -   (22)    -   (343)  (9,539)
External revenue  8,223   691   24,470    373   1,748   3,162    1,395    40,062 
Adjusted EBITDA*  4,460  4,746  4,579   (42) 1,079  717   (9,282) 6,257 
Exceptional costs  (481)  (663) -   (170) -     -   (792)  (2,106)
Share-based payment   -  -  -  -     -  -   (512)  (512)
EBITDA 3,979 4,083 4,579 (212)  1,079 717 (10,586) 3,639
Depreciation              (609)            (117)  (458)             (11)               (35) (23) (115) (1,368)
Exceptional impairment - - - (1,162) - - - (1,162)
Amortisation  (603) (624) (1,465) (229) (108) (24)            (529) (3,582)
Operating proﬁ t/(loss) 2,767 3,342 2,656 (1,614) 936 670 (11,230) (2,473)
Net ﬁ nance costs (21) (694) (231) - 5 - (614) (1,555)
Income tax (58) (714) (687) 141 (189) (131) 198 (1,440)
Proﬁ t/(loss) for the year 2,688 1,934 1,738   (1,473) 752 539 (11,646) (5,468)
Segment assets        
Operating assets 26,655 21,147 92,578 1,667 956 623 20,086 163,712
Inter-segment assets (1,703) (5,469) - - - - (29,107) (36,279)
External operating assets 24,952  15,678   92,578   1,667   956   623  (9,021) 127,433
Cash and cash equivalents  1,586   378   240   86   1,037   553   4,466   8,346 
Total assets  26,538   16,056   92,818  1,753   1,993   1,176  (4,555)  135,779
Segment liabilities        
Operating liabilities  15,164   11,093   24,845   655   157   119   26,887  78,920 
Inter-segment liabilities  (10,665)  (7,165)  (18,985)  -   52   -   -   (36,763)
External operating liabilities  4,499   3,928   5,860   655   209   119   26,887   42,157 
Borrowings  441   174   2,591   -   -   -   3,040   6,246 
Total liabilities  4,940   4,102   8,451   655   209   119   29,927   48,403 
Other segmental information       
Non-current assets – PPE  3,685   135   4,753   14   167   59   1,755   10,568 
Non-current assets – Intangibles  13,130   11,141  55,502   759   478   173   12,339   93,522 
Non-current assets – additions 927 718 418 480 13 23 957 3,536
* Adjusted EBITDA excludes exceptional items and share-based payments.
Notes to the Financial Statements continued
for the year ended 31 December 2014
5. Segmental reporting continued
The segment information provided to the Board for the reportable segments for the year ended 31 December 2014 is as follows: EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 45
 Germany UK USA Ireland Poland Russia Other Total
2013 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 
Income statement        
Revenue 13,091 3,143 17,338 389 1,241 3,900 – 39,102
Inter-segment (6,191) (1,099) – – (8) – – (7,298)
External revenue 6,900 2,044 17,338 389 1,233 3,900 – 31,804
Adjusted EBITDA*  3,492 (1,341) 4,576 237 418 746 (3,304) 4,824
Exceptional costs 1,575 757 258 – – – – 2,590
Share-based payment – – – – – – (709) (709)
EBITDA 5,067 (584) 4,834 237 418 746 (4,013) 6,705
Depreciation (662) (180) (299) (45) (38) (15) (65) (1,304)
Exceptional impairment – – – (750) – – – (750)
Amortisation (650) (495) (728) (218) (118) (41) – (2,250)
Operating proﬁ t/(loss) 3,755 (1,259) 3,807 (776) 262 690 (4,078) 2,401
Net ﬁ nance costs (247) (488) (256) – (1) – (802) (1,794)
Income tax (1,115) 179 (540) 131 (36) (131) 12 (1,500)
Proﬁ t/(loss) for the year 2,393 (1,568) 3,011 (645) 225 559 (4,868) (893)
Segment assets        
Operating assets 16,858 14,147 21,101 2,347 1,136 1,052 26,325 82,966
Inter-segment assets (314) (43) – – – – (24,437) (24,794)
External operating assets 16,544 14,104 21,101 2,347 1,136 1,052 1,888 58,172
Cash and cash equivalents 1,123 244 42 – 256 727 159 2,551
Total assets 17,667 14,348 21,143 2,347 1,392 1,779 2,047 60,723
Segment liabilities        
Operating liabilities 7,335 9,891 13,525 402 (126) 179 6,962 38,168
Inter-segment liabilities (4,663) (6,350) (9,981) – 187 – – (20,807)
External operating liabilities 2,672 3,541 3,544 402 61 179 6,962 17,361
Borrowings 481 166 1,789 – 4 – – 2,440
Total liabilities 3,153 3,707 5,333 402 65 179 6,962 19,801
Other segmental information       
Non-current assets – PPE 3,386 688 3,769 23 206 87 1,626 9,785
Non-current assets – Intangibles 9,188 11,068 11,758 1,738 642 331 – 34,725
Non-current assets – additions 1,034 5,851 78 394 19 77 27 7,480
* Adjusted EBITDA excludes exceptional items and share-based payments.
‘Other’ primarily relates to the holding company and head ofﬁ ce costs, and to the operations of DiaSpect which is headquartered in 
Sweden. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 46
 2014 2013 
 £’000 £’000 
Americas  
United States of America 12,711 9,873
Mexico 7,560 3,434
Rest of Americas 2,440 1,755
Europe, Middle East and Africa (EMEA)  
Germany 4,848 4,002
United Kingdom 287 251
Rest of Europe 2,791 2,702
Russia 3,174 3,905
Middle East 687 763
Africa 1,315 1,114
Rest of World  
China 2,304 2,050
Asia 1,892 1,913
New Zealand/Australia 53 42
Total revenue 40,062 31,804
Revenues of approximately £6.0m (2013: £2.5m) are derived from a single external customer located in Mexico.
Notes to the Financial Statements continued
for the year ended 31 December 2014
5. Segmental reporting continued
Disclosure of Group revenues by geographic location is as follows:
 2014 2013 
 £’000 £’000 
Inventories consumed in cost of sales  8,726  7,515
Employee beneﬁ t expense (note 10)  16,524  13,389
Depreciation and amortisation  4,950  3,554
Transaction costs relating to business combinations (note 7)  809  93
Research and development expenses  1,253  1,241
Foreign exchange  446  10
Operating lease payments 492 258
Other expenses 9,706 3,838
Total cost of sales and administrative expenses 42,906 29,898
Included within the above expenses are exceptional items as set out in note 7.
6. Expenses - analysis by nature
  2014 2013 
 Note £’000 £’000 
– Warranty claim a (281) 1,241
– Exceptional release of provision a - 334
– Transaction costs relating to business combinations  (809) (93)
– Impairment charges - goodwill b (254) (750)
– Impairment charges - other b (908) -
– Release of deferred consideration provisions c 79 1,108
– Cost of closure and transfer of Quotient manufacturing to Germany d (925) –
– Cost of transfer of EKF Ireland to UK e (170) –
Exceptional items – continuing   (3,268) 1,840 
(a) Estimated warranty claim in relation to the acquisition of EKF-diagnostic GmbH and the release of a previously held provision   
 associated with the tax claim.
(b) Impairment of goodwill and other intangible assets associated with EKF Diagnostics Limited, Ireland.
(c) Release of deferred consideration provisions associated with Quotient Diagnostics Limited.
(d) Costs associated with the move of Quo-Test and Quo-Lab production from the UK to Germany and the closure of the 
 manufacturing operation in the UK. Costs include severance pay of £303,000, and asset write off of £155,000.
(e) Costs associated with the move of Irish biomarker products to the UK and the closure of the majority of the operations in Ireland. 
7. Exceptional items
Included within Administrative expenses are exceptional items as shown below: EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 47
 2014 2013 
 £’000 £’000 
Fees payable to Company’s auditor and its associates for the audit of the parent Company 
and consolidated ﬁ nancial statements 38 39
Fees payable to the Company’s auditor and its associates for other services:  
– The audit of Company’s subsidiaries 111 69
– Other services 71 29
– Tax compliance services 28 16
 248 153
8. Auditor remuneration
During the year the Group (including its overseas subsidiaries) obtained the following services from the Company’s auditor and its 
associates:
 2014 2013 
 £’000 £’000 
Aggregate emoluments 941 672
Contribution to deﬁ ned contribution pension scheme 29 8
 970 680
Retirement beneﬁ ts are accruing to 4 (2013: 2) Directors under a deﬁ ned contribution scheme.
See further disclosures within the Remuneration Report on page 26.
9. Directors’ emoluments
 2014 2013 
Highest paid Director £’000 £’000 
Aggregate emoluments 250 299
Contribution to deﬁ ned contribution pension scheme 12 7
   
 2014 2013 
 £’000 £’000 
Wages and salaries 14,865 11,091
Social security costs 1,472 1,672
Share options granted to Directors and Senior Management 512 709
Pension costs – deﬁ ned contribution plans (note 33) 225 208
  17,074  13,680
Employee costs of £0.5m (2013: £0.3m) have been capitalised as part of development costs.
10. Employee beneﬁ t expense
 2014 2013 
 Number Number 
Monthly average number of people (including Executive Directors) employed was:  
Administration 66 59
Research and development 32 29
Sales and marketing 78 72
Manufacturing, production and after sales 192 160
  368 320
The total number of employees at 31 December 2014 was 395 (2013: 330).
11. Monthly average number of people employed ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 48
Notes to the Financial Statements continued
for the year ended 31 December 2014
12. Finance income and costs
 2014 2013 
 £’000 £’000 
Finance costs:  
– Bank borrowings 290 135
– Finance lease liabilities - 6
– IAS 19 interest expense (note 33) - 4
– Other interest - 212
– Financial liabilities at fair value through proﬁ t or loss – (gains)/losses (476) 750
– Deferred consideration-unwinding of discount (note 27) 1,751 685
– Convertible debt 8 7
Finance costs 1,573 1,799
Finance income  
– Interest income on cash and short-term deposits 18 2
– Other interest - 3
Finance income 18 5 
Net ﬁ nance costs  1,555 1,794
13. Income tax
 2014 2013 
Group £’000 £’000 
Current tax:  
Current tax on loss for the year 1,677 1,602
Adjustments in respect of prior years (263) 1,022
Total current tax 1,414 2,624
  
Deferred tax (note 28):  
Origination and reversal of temporary differences 26 (701)
Adjustment arising in previous period - –
Impact of deferred tax rate change - (423)
Total deferred tax 26  (1,124)
Income tax charge 1,440  1,500
On 21 March 2013 the UK Government announced a reduction in the rate of corporation tax to 21% with effect from 1 April 2014, and 
to 20% with effect from 1 April 2015. 
The tax on the Group’s loss before tax differs from the theoretical amount that would arise using the standard tax rate applicable to 
the proﬁ ts of the consolidated entities as follows:
 2014 2013 
 £’000 £’000 
(Loss)/proﬁ t before tax (4,028) 607
Tax calculated at domestic tax rates applicable to UK standard rate of tax of 21.5% (2013: 23.25%) (866) 141
Tax effects of:  
– Expenses not deductible for tax purposes 748 398
– Losses carried forward 696 531
– Adjustment in respect of prior years (263) 1,022
– Impact of different tax rates in other jurisdictions 163 467
– Utilisation of previously unrecognised tax losses - (173)
– Effect of reduction in tax rate - (423)
– Impact of utilisation of deferred tax asset 1,079 -
– Other movements (117) (463)
Tax charge 1,440 1,500
There are no tax effects on the items in the statement of other comprehensive income. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 49
14. Loss per share
(a) Basic
Basic  loss per share is calculated by dividing the loss attributable to owners of the parent by the weighted average number of 
Ordinary Shares in issue during the year.
 2014 2013 
 £’000 £’000 
Loss attributable to owners of the parent (5,689) (1,126)
Weighted average number of Ordinary Shares in issue 379,633,724 271,695,776
Basic loss per share (1.50) pence  (0.41) pence
(b) Diluted
Diluted loss per share is calculated by adjusting the weighted average number of Ordinary Shares outstanding assuming conversion 
of all dilutive potential Ordinary Shares. The Company has two categories of dilutive potential ordinary share: equity-based long-term 
incentive plans and share options. The potential shares are not dilutive in either 2014 or 2013 as the Group has made a loss per share.
 2014 2013 
 £’000 £’000 
Loss attributable to owners of the parent (5,689) (1,126)
  
Weighted average diluted number of Ordinary Shares  393,511,556 286,302,764
  
Diluted loss per share (1.50) pence  (0.41) pence
 2014 2013 
 £’000 £’000 
Weighted average number of Ordinary Shares in issue 379,633,724 271,695,776
Adjustment for:  
– Assumed conversion of share awards 9,833,892 10,563,048
– Assumed payment of equity deferred consideration 4,043,940 4,043,940
Weighted average number of Ordinary Shares for diluted loss per share 393,511,556 286,302,764
15. Dividends
There were no dividends paid or proposed by the Company in either year. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 50
Notes to the Financial Statements continued
for the year ended 31 December 2014
16. Property, plant and equipment
 Land and Fixtures Plant and Motor  
 buildings and ﬁ ttings machinery Vehicles Total
Group £’000 £’000 £’000 £’000 £’000
Cost     
At 1 January 2013 – restated 5,689 746 6,931 65 13,431
Additions 344 101 669 71 1,185
Transfers – – (114) – (114)
Exchange differences (48) 3 120 (3) 72
Disposals – (17) (87) (28) (132)
At 31 December 2013 5,985 833 7,519 105 14,442
     
Accumulated depreciation     
At 1 January 2013 – restated 260 281 2,873 3 3,417
Charge for the year 155 170 956 23 1,304
Exchange differences 3 4 10 (2) 15
Disposals – (17) (45) (17) (79)
At 31 December 2013 418 438 3,794 7 4,657
     
Net book value
At 31 December 2013 5,567 395 3,725 98 9,785
Cost     
At 1 January 2014 5,985 833 7,519 105 14,442
Additions 127 141 748 22 1,038
Acquired with subsidiaries 35 7 1,156 - 1,198
Transfers - 15 (15) - -
Exchange differences 147 (11) (314) (45) (223)
Disposals - (31) (81)  - (112)
At 31 December 2014 6,294 954 9,013 82 16,343
     
Accumulated depreciation     
At 1 January 2014  418 438 3,794 7 4,657
Charge for the year 171 154 1,015 28 1,368
Exceptional impairment - - 67 - 67
Exchange differences 13 (21) (196) (17) (221)
Disposals - (29) (67) - (96)
At 31 December 2014 602 542 4,613 18 5,775
     
Net book value
At 31 December 2014 5,692 412 4,400 64 10,568
In 2013 opening cost and accumulated depreciation were restated to account for transfers between classiﬁ cations. The restatement 
has had no impact in either year on the net book value of property, plant and equipment or the current or prior year income 
statements.
Property, plant and equipment includes assets under construction which are not depreciated until they are brought into use. In 2013 
an asset previously classiﬁ ed as plant and machinery under construction was reclassiﬁ ed as capitalised development expenditure. 
The effect of this is shown as a transfer.
Depreciation expense of £878,000 (2013: £716,000) has been charged to cost of sales and £557,000 (2013: £588,000) has been 
charged to administrative expenses, of which £67,000 is included in exceptional items. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 51
16. Property, plant and equipment continued
 Landand Fixtures
buildings and ﬁ ttings Total
Company £’000 £’000 £’000
Cost 
At 1 January 2013 1,670 16 1,686
Additions 3 2326
At 31 December 2013 1,673  39  1,712 
Accumulated depreciation 
At 1 January 2013 40 5 45
Charge for the year 40 11 51
At 31 December 2013 80  16  96 
Net book value
At 31 December 2013 1,593  23  1,616 
Cost 
At 1 January 2014 1,673  39  1,712 
Additions - 1717
At 31 December 2014 1,673 56 1,729
Accumulated depreciation
At 1 January 2014 80  16  96 
Charge for the year 42 15 57
At 31 December 2014 122 31 153
Net book value
At 31 December 2014 1,551 25 1,576
The Company’s freehold property is in Germany and occupied by its subsidiary undertaking, EKF-diagnostic GmbH Germany. 
EKF-diagnostic GmbH is paying rental income of ¤13,900 (£10,800) per month to the parent Company. ¤167,000 (£130,000) 
(2013: ¤167,000 (£139,000)) was paid to the parent Company for the year.
Plant and machinery includes the following amounts where the Group is a lessee under a ﬁ nance lease arrangement:
2014 2013
£’000 £’000
Cost – capitalised ﬁ nance leases 879 262
Accumulated depreciation (162) (74)
Net book value (717) 188
The Group leases various assets under non-cancellable ﬁ nance lease agreements. The lease terms are between 2 and 6 years.
The Company has no ﬁ nance lease agreements. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 52
Notes to the Financial Statements continued
for the year ended 31 December 2014
17. Intangible assets
 Non-compete  Trademarks, trade Customer Trade Development 
 agreements Goodwill name and licences relationships secrets costs Total
Group £’000 £’000 £’000 £’000 £’000 £’000 £’000
Cost     
At 1 January 2013 – 13,442 1,575 8,612 9,548 1,788 34,965
Transfer from PPE – – – – – 114 114
Additions 70 1,178 36 – 3,950 1,061 6,295
Exchange differences – 21 (15) (133) 154 13 40
At 31 December 2013 70 14,641 1,596 8,479 13,652 2,976 41,414
Accumulated amortisation       
At 1 January 2013 – – 261 1,323 2,000 131 3,715
Exchange differences – – 24 (18) (32) – (26)
Impairment charge – 750 – – – – 750
Charge for the year 18 – 127 789 1,152 164 2,250
At 31 December 2013 18  750 412 2,094 3,120 295 6,689
Net book value 
At 31 December 2013 52 13,891 1,184 6,385 10,532  2,681 34,725
Cost       
At 1 January 2014 70 14,641 1,596 8,479 13,652 2,976 41,414
Transfer from PPE       
Additions - 30,899 2,335 9,672 16,985 1,897 61,788
Exchange differences - 880 76 367 260 (44) 1,539
At 31 December 2014 70 46,420 4,007 18,518 30,897 4,829 104,741
Accumulated amortisation       
At 1 January 2014 18  750 412 2,094 3,120 295 6,689
Exchange differences - (50) (5) (18) (136) (5) (214)
Impairment charge - 254 - - 287 621 1,162
Charge for the year 23 - 295 1,268 1,706 290 3.582
At 31 December 2014 41 954 702 3,344 4,977 1,201 11,219
       
Net book value 
At 31 December 2014 29 45,466 3,305 15,174 25,920 3,628 93,522
The amortisation charge and impairment of £4,744,000 (2013: £3,000,000) has been charged to administrative expenses in the income statement.
Goodwill is allocated to the Group’s cash–generating units (CGU’s) identiﬁ ed according to geographic operating segment. 
An operating segment-level summary of the goodwill allocation is presented below.
 2014 2013 
 £’000 £’000 
UK 4,568 4,568
Germany 3,700 3,959
Poland 306 335
Russia 85 142
Ireland - 272
US 28,085 4,615
Other (primarily relating to DiaSpect) 8,722 -
Total 45,466  13,891
Goodwill is tested for impairment at the balance sheet date. The recoverable amount of goodwill at 31 December 2014 was assessed 
on the basis of value in use. With the exception of the Irish unit, the assessed value exceeded the carrying value and showed 
signiﬁ cant head room over it and no impairment loss was recognised. The carrying value the Irish unit has been impaired by 
£254,000 to reﬂ ect a reduction in the assessed recoverable amount.
The key assumptions in the calculation to assess value in use are the future revenues and the ability to generate future cash ﬂ ows. The 
most recent ﬁ nancial results and initial budgets approved by management for the next year were used and forecasts for a further four 
years, followed by an extrapolation of expected cash ﬂ ows at a constant growth rate for each unit and the calculation of a terminal value 
based upon the longer term growth rates set out below. The projected results were discounted at a rate which is a prudent evaluation of 
the pre-tax rate that reﬂ ects current market assessments of the time value of money and the risks speciﬁ c to the cash-generating units. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 53
The key assumptions used for value in use calculations in 2014 are as follows:
   Molecular  Quotient EKF Germany EKF Poland EKF Russia Stanbio STI Selah DiaSpect 
   % % % % % % % % %
Longer-term growth rate   3 3 3 3 3 3 3 4 5
Discount Rate   20 14 13 26 26 12 12 12 10
 
The discount rates used are primarily based on those used in the initial purchase price appraisal of the acquisitions. The Group’s 
Russian operations are being indirectly affected by economic sanctions and budget cuts by the Russian government, but are 
expected to return to normal operations in the near future. A higher discount rate has been used for appraisal of the goodwill 
associated with EKF Russia to reﬂ ect the additional risk. During the year the Group announced that its Irish operations would be 
closed and the operations transferred elsewhere within the Group, with some R & D projects being reassessed for viability. As a result 
the goodwill and intangible assets associated with the Irish operations other than for certain speciﬁ c customer relationships have 
been impaired in full. 
The UK includes the cash generating units Quotient Diagnostics Limited and EKF Molecular Diagnostics Limited (which includes 
360 Genomics). The Directors estimate that long-term growth from the EKF Molecular businesses will be high because of the 
characteristics of its markets. EKF Molecular is a start-up business operating in a high growth segment of the diagnostics market. 
Revenues and cash ﬂ ows have been assessed over a six year period. Year 1 of the revenue forecast is the ﬁ rst year of signiﬁ cant 
revenue. In Years 2 and 3 growth rates of 100% have been used, falling to 17% in Year 4. Because of the low starting base and the 
potential for this business a long-term growth rate of 10% has been used for Year 5 onwards. If revenues are lower than those 
forecast by approximately 10%, then impairment will be required.
The main business and assets of Quotient Diagnostics have been transferred to the Group’s main German subsidiary. 
The US includes the cash generating units Stanbio, STI and Selah. The Selah business is at a fairly early stage of its development and 
again is starting from a low base. The Group is conﬁ dent about its future prospects as it is in a high growth sector and there are 
signiﬁ cant opportunities for PrecisionPath and other products. Revenue and cash ﬂ ows have been assessed over a six year period.  
The growth rates used are as follows:
  Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Revenue growth rate  Base 67% 124% 84% 17% 3%
A long term growth rate of 4% has been used because of the high growth rate of the sector in which the business operates. There is 
no signiﬁ cant headroom using these rates so if revenues are lower than forecast then impairment will be necessary. 
The impairment assessments for Germany, Poland, Russia, Stanbio and STI showed assessed values that exceeded the carrying value 
and showed signiﬁ cant headroom.
The remaining average useful lives of the intangibles are as follows:
Trade name      4–9 years
Customer relations      2–15 years
Trade secrets      2–15 years
Development costs       12 years
Non-compete agreements      2 years
The Company has no intangible assets. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 54
Notes to the Financial Statements continued
for the year ended 31 December 2014
18. Investments in subsidiaries
 2014 2013 
Company Shares in Group undertakings £’000 £’000 
1 January  16,630 15,613
Additions 46,013 1,600
Impairment (1,600) (583)
31 December 61,043 16,630
The additions in 2014 relate to the acquisitions of Diaspect Medical AB, and Selah Genomics Inc. (see note 21). The impairment relates 
to the investment in EKF Diagnostics Limited (Ireland).
Investments in Group undertakings are recorded at cost, which is the fair value of the consideration paid, less any impairment.
The principal subsidiaries of EKF Diagnostics Holdings plc are as follows:
    Class of
Name of Company Note Proportion Held Shareholding Nature of Business
EKF Diagnostics Limited  1 100%  Ordinary Head Ofﬁ ce
Quotient Diagnostics Limited 1 100%  Ordinary Sale of diagnostic equipment
360 Genomics Limited 1 100% (indirect) Ordinary Manufacture and sale of diagnostic equipment
EKF Molecular Diagnostics Limited 1 100%  Ordinary Manufacture and sale of diagnostic equipment
DiaSpect Medical AB 2 100%  Ordinary Head ofﬁ ce and IP licencing
DiaSpect Medical GmbH 3 100%  Ordinary Manufacture and sale of diagnostic equipment
EKF-diagnostic GmbH Germany 3 100%  Ordinary Manufacture and sale of diagnostic equipment
Senslab GmbH 3 100%  (indirect) Ordinary Diagnostic testing
EKF Diagnostyka Sp.z.o.o. 4 100%  (indirect) Ordinary Manufacture and sale of diagnostic equipment
000 EKF Diagnostika 5 60%    (indirect) Ordinary Sale of diagnostic equipment
EKF Diagnostics Inc 6 100%  Ordinary Intermediate holding company
Stanbio Laboratory LP 6 100%  (indirect) Partnership  Manufacture and sale of diagnostic equipment
Stanbio Life Sciences LP 6 100%  (indirect) Partnership Manufacture and sale of diagnostic equipment
Separation Technology, Inc 6 100%  Ordinary Manufacture and sale of diagnostic equipment
Selah Genomics Inc 6 100%  (Indirect) Ordinary Supply of molecular diagnostic services
EKF Diagnostics Limited 7 100%  Ordinary Manufacture and sale of diagnostic equipment
Notes
1. Incorporated and registered in the United Kingdom.
2. Incorporated in Sweden.
3. Incorporated and registered in Germany.
4. Incorporated and registered in Poland.
5. Incorporated and registered in Russia.
6. Incorporated and registered in the United States of America.
7. Incorporated and registered in Ireland. 
All subsidiaries are included in the consolidation. The proportions of voting shares held by the parent Company do not differ from the 
proportion of Ordinary Shares held.
All UK subsidiaries are exempt from the requirement to ﬁ le audited accounts by virtue of section 479A of the Companies Act 2006. 
As part of this process, the Company has provided statutory guarantees to these subsidiaries. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 55
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
31 December     
Assets as per balance sheet    
Trade and other receivables excluding prepayments and corporation tax 14,947 6,406 36,155 24,996
Cash and cash equivalents  8,346 2,551 4,390 159
Total 23,293 8,957 40,545 25,155
Receivables in the analysis above are all categorised as ‘loans and receivables’ for the Group and Company.
(b) Liabilities
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
31 December     
Liabilities as per balance sheet    
Borrowings (excluding ﬁ nance lease liabilities) 5,348 2,071 2,843 -
Finance lease liabilities 898 369 - -
Trade and other payables 7,731 4,023 3,679 4,166
Deferred consideration 18,029 7,249 11,658 1,778
Total 32,006 13,712 18,180 5,944
Liabilities in the analysis above are all categorised as ‘other ﬁ nancial liabilities at amortised cost’ for the Group and Company, with 
the exception of deferred equity consideration totalling £880,000 (2013: £1,355,000) that is categorised as a ﬁ nancial liability at fair 
value through proﬁ t and loss.
(c) Credit quality of ﬁ nancial assets
The Group is exposed to credit risk from its operating activities (primarily for trade receivables and other receivables) and from 
its ﬁ nancing activities, including deposits with banks and ﬁ nancial institutions, foreign exchange transactions and other ﬁ nancial 
instruments.
The Group’s maximum exposure to credit risk, due to the failure of counterparties to perform their obligations as at 31 December 
2014 and 31 December 2013, in relation to each class of recognised ﬁ nancial assets, is the carrying amount of those assets as 
indicated in the accompanying balance sheets.
Trade receivables
The credit quality of trade receivables that are neither past due nor impaired have been assessed based on historical information 
about the counterparty default rate. The Group does not hold any other receivable balances with customers, whose past default has 
resulted in the recovery of the receivables balances.
Cash at bank
The credit quality of cash has been assessed by reference to external credit ratings, based on reputable credit agencies’ long-term 
issuer ratings:
   2014 2013 
   £’000 £’000
AA-   4,749 42
Ratings lower than AA- or unrated   3,597 2,509
Total   8,346 2,551
20. Investments
   2014 2013 
Group and Company   £’000 £’000 
1 January   250 250
Additions   902 –
31 December   1,152 250
The investment consists of a 2.63% (2013: 2.63%) shareholding in Arcis Biotechnology Holdings Limited, a UK based privately held 
company operating in the biotechnology industry;  a 19.90% holding in DX Economix, Inc., a Canadian based privately held company 
operating in the healthcare consultancy industry; and a 0.67% holding in Epinex Diagnostics Inc., a US based privately held company 
operating in the medical diagnostics industry.
19. Financial instruments by category
(a) Assets ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 56
Notes to the Financial Statements continued
for the year ended 31 December 2014
21. Business combinations
 
Acquisition of Separation Technology Inc. 
On 11 March 2014 the Group acquired, through its subsidiary company EKF Diagnostics Inc., 100% of the share capital of Separation 
Technology Inc. (STI), a US based company which manufactures and sells devices for the hematology testing market.
The goodwill of £833,000 arising from the acquisition is attributable to the expected future beneﬁ ts arising from the acquired 
business.
The following table summarises the provisional fair values of the consideration paid for STI and the amounts of the assets acquired 
and liabilities assumed recognised at the acquisition date. Acquisition related costs of £50,000 have been written off against income 
and disclosed as an exceptional item.
 Provisional fair values
  £’000
Consideration 
Cash  2,400
  2,400
 
Recognised amounts of identiﬁ able assets acquired and liabilities assumed 
Trade name – included within intangibles  228
Customer relationships – included in intangibles  1,074
Trade secrets – included in intangibles  210
Plant, property and equipment  177
Cash  72
Inventories  353
Trade and other debtors  310
Trade and other payables  (267)
Deferred tax  (590)
Total identiﬁ able net assets  1,567
Goodwill  833
The revenue included in the consolidated statement of comprehensive income since 11 March 2014 contributed by STI was £2.1m. STI 
also contributed a loss of £0.2m after tax and management charges over the same period.
Had STI been consolidated from 1 January 2014 the consolidated statement of income would show pro forma revenue of £40.5m and 
loss of £5.2m.
Acquisition of DiaSpect Medical AB
On 17 April 2014 the Group acquired 100% of the share capital of Diaspect Medical AB (DiaSpect), a group based in Sweden and 
Germany which manufactures and sells point-of-care hemoglobin analysers and their associated consumables.
The goodwill of £9,239,000 arising from the acquisition is attributable to the expected future beneﬁ ts arising from the acquired 
business.
The following table summarises the provisional fair values of the consideration paid for DiaSpect and the amounts of the assets 
acquired and liabilities assumed recognised at the acquisition date. Acquisition related costs are disclosed below.
 
 Provisional fair values
  £’000
Consideration 
Cash  10,248
Equity instruments  5,555
Deferred contingent consideration  1,288
  17,091 EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 57
Recognised amounts of identiﬁ able assets acquired and liabilities assumed 
Trade name – included within intangibles  840
Customer relationships – included in intangibles  4,049
Trade secrets – included in intangibles  4,140
Development costs – included in intangibles  370
Plant, property and equipment  443
Cash  39
Inventories  841
Trade and other debtors  216
Trade and other payables  (633)
Borrowings  (186)
Deferred tax  (2,267)
Total identiﬁ able net assets  7,852
Goodwill  9,239
A revision to the deferred consideration was agreed in December 2014. A single payment of £1,425,000 will be made in 2015. The 
amount has been discounted to take account of the time value of money.
The revenue included in the consolidated statement of comprehensive income since 17 April 2014 contributed by DiaSpect was 
£1.4m. DiaSpect also contributed £nil after tax and management charges over the same period.
Had Diaspect been consolidated from 1 January 2014 the consolidated statement of income would show pro forma revenue of 
£40.7m and loss of £5.4m.
Acquisition of Selah Genomics Inc.
On 17 April 2014 the Group acquired 100% of the share capital of Selah Genomics Inc. (Selah), a US company which develops 
molecular diagnostics for personalised medicine.
The goodwill of £20,827,000 arising from the acquisition is attributable to the expected future beneﬁ ts arising from the acquired 
business.
The following table summarises the provisional fair values of the consideration paid for Selah and the amounts of the assets acquired 
and liabilities assumed recognised at the acquisition date. Costs relating to the acquisitions of both DiaSpect and Selah of £759,000 
have been written off against income and disclosed as an exceptional item. Because the acquisitions of DiaSpect and Selah were 
simultaneous it is not possible to split the costs.
 Provisional fair values
  £’000
Consideration 
Equity instruments  20,425
Deferred contingent consideration  8,497
  28,922
Recognised amounts of identiﬁ able assets acquired and liabilities assumed 
Recognised amounts of identiﬁ able assets acquired and liabilities assumed 
Trade name – included within intangibles  1,199
Customer relationships – included in intangibles  4,549
Trade secrets – included in intangibles  12,635
PPE  578
Cash  158
Inventories  149
Trade and other debtors  628
Trade and other payables  (2,978)
Borrowings  (1,286)
Deferred tax  (7,537)
Total identiﬁ able net assets  8,095
Goodwill  20,827
21. Business combinations continued ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 58
Notes to the Financial Statements continued
for the year ended 31 December 2014
The deferred contingent consideration is payable over a period of up to two years, and is contingent upon the achievement of certain 
revenue milestones.  The maximum contingent consideration payable is $35,000,000 however the Board’s judgement based on 
revenue forecasts is that the deferred consideration relating to revenue in the ﬁ rst year after acquisition ($17,500,000) will not be paid 
and this has not been provided. The amount has been discounted at a rate of 13.2% to take account of the time value of money.
The revenue included in the consolidated statement of comprehensive income since 17 April 2014 contributed by Selah was £3.0m. 
Selah also contributed a loss of £0.6m after tax and management charges over the same period.
Had Selah been consolidated from 1 January 2014 the consolidated statement of income would show pro forma revenue of £41.4m 
and loss of £5.6m.
Had all three acquisitions been consolidated from 1 January 2014 the consolidated statement of income would show pro forma 
revenue of £42.4m and loss of £5.3m. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 59
22. Trade and other receivables
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
Non-current    
Amounts owed by subsidiary undertakings - - 17,799 17,799
Current    
Trade receivables 12,763 4,896 - -
Less: provision for impairment of trade receivables  (978) (91) - -
Trade receivables – net 11,785 4,805 - -
Prepayments  331 270 152 78
Amounts owed by subsidiary undertakings  - - 18,315 7,142
Corporation tax receivable  837 479 - -
Other receivables 3,162 1,601 41 55
 16,115 7,155 18,508 7,275
The Directors consider that the carrying amount of trade and other receivables approximates to their fair value.
As of 31 December 2014, trade receivables of £6,842,000 (2013: £62,000) were past due but not impaired. These relate to a number
of independent customers for whom there is no recent history of default. The ageing analysis of these trade receivables is as follows:
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000
    
Up to 3 months 4,498 62 - -
3 to 6 months  2,330 - - -
6 months to 12 months  14 - - -
 6,842 62 - -
As of 31 December 2014, trade receivables of £978,000 (2013: £91,000) were impaired and provided for. The ageing of these 
impaired receivables is as follows:
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
    
Up to 3 months 6 - - -
3 to 6 months  329 - - -
6 months to 12 months  643 91 - -
Movements on the provision for impairment of trade receivables are as follows:
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
    
At 1 January 91 334 - -
Provision for receivables impairment  613 41 - -
Acquired with subsidiaries 349 - - -
Receivables written off during the year as uncollectible  - (284) - -
Unused amounts reversed (70) - - -
Exchange differences (5) - - -
At 31 December 978 91 - - ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 60
Notes to the Financial Statements continued
for the year ended 31 December 2014
The other classes within trade and other receivables do not contain impaired assets.
The carrying amounts of the Group’s trade and other receivables denominated in foreign currencies were as follows:
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
    
UK Sterling 356 682 7,359 6,483
Euros 4,739 2,452 9,458 7,146
US dollar 10,712 3,716 19,490 11,445
Russian rouble 70 104 - -
Polish zloty 238 201 - -
 16,115 7,155 36,307 25,074
22. Trade and other receivables continued
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
    
Raw materials 3,225 3,615 - -
Work in progress 553 501 - -
Finished goods 2,015 1,192 - -
 5,793 5,308 - -
The Directors are of the opinion that the replacement values of inventories are not materially different to the carrying values stated 
above. The carrying values above are stated net of impairment provisions of £969,000 (2013: £445,000).
The cost of inventories recognised as expense and included in ‘cost of sales’ amounted to £8,726,000 (2013: £7,515,000).
The Company held no inventories.
23. Inventories
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
    
Cash at bank and in hand 4,422 2,275 595 159
Short-term bank deposits 3,924 276 3,795 -
Cash and cash equivalents (excluding bank overdrafts) 8,346 2,551 4,390 159
The Directors consider that the carrying amount of cash and cash equivalents approximates to their fair value.
24. Cash and cash equivalents
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
    
Trade payables 1,500 959 209 145
Amounts due to subsidiary undertakings - - 2,913 2,837
Social security and other taxes 212 166 79 51
Other payables 2,354 412 - -
Accrued expenses and deferred income 3,877 2,652 557 1,184
Cash and cash equivalents (excluding bank overdrafts) 7,943 4,189 3,758 4,217
25. Trade and other payables EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 61
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
Non-current    
Bank borrowings 1,668 1,614 - -
Convertible loan  174 166 - -
Finance lease liabilities  650 328 - -
 2,492 2,108 - -
Current    
Bank borrowings 3,506 291 2,843 -
Finance lease liabilities  248 41 - -
 3,754 332 2,843 -
The maturity proﬁ le of borrowings was as follows:
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
    
Amounts falling due
Within 1 year 3,754 332 2,843 -
Between 1 and 2 years 320 246 - -
Between 2 and 5 years 653 512 - -
More than 5 years 1,519 1,350 - -
Total borrowings 6,246 2,440 2,843 -
(a) Bank borrowings
Bank borrowings have maturity proﬁ les from 2015 through to 2022 and bear an average ﬁ xed coupon of 3.19% annually 
(2013: 4.79%).
Bank borrowings are secured against certain assets of the Group. The Parent Company has also provided guarantees against those 
bank borrowings which are denominated in foreign currencies.
The Group facility, and the US Dollar and Euro denominated borrowings have covenants attached to them. The Group has been 
compliant with these covenants throughout the year.
The bank borrowings are repayable by either monthly or quarterly instalments, or at the end of a six month loan period.
The Group is not exposed to interest rate changes or contractual re-pricing dates at the end of the reporting period, as the 
borrowings are ﬁ xed in nature.
The fair value of both current and non-current borrowings equals their carrying amount, as the impact of discounting is not 
signiﬁ cant. The fair values are based on cash ﬂ ows discounted using a rate based on the borrowing rate of 5% (2013: 5%).
The carrying amounts of the Group’s bank borrowings are denominated in the following currencies:
 Group Group Company Company
 2014 2013 2014 2013
 £’000 £’000 £’000 £’000 
    
Euros 398 413 - -
US Dollar 4,776 1,488 2,843 -
Polish Zloty - 4 - -
 5,174 1,905 2,843 -
26. Borrowings ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 62
Notes to the Financial Statements continued
for the year ended 31 December 2014
(b) Convertible loan
Andrew Webb has loaned £200,000 to EKF Molecular Diagnostics Limited in return for a convertible loan note. The note is redeemable on
31 December 2017 or convertible under certain circumstances on or before 30 November 2017 into shares representing 20% of the share
capital of EKF Molecular Diagnostics Limited. Interest only becomes payable in the event of a default. The principal has been split into a
debt element and an equity element. The equity element is disclosed in Other Reserves. The note is denominated in sterling.
(c) Finance lease liabilities
Lease liabilities are effectively secured as the rights to the leased asset revert to the lessor in the event of default.
2014 2013
£’000 £’000
Gross ﬁ nance lease liabilities – minimum lease payments
No later than 1 year 294 45
Later than 1 year and no later than 5 years 442 68
Later than 5 years 308 263
1,044 376
Future ﬁ nance charges on ﬁ nance leases (146) (7)
Present value of ﬁ nance lease liabilities 898 369
The present value of ﬁ nance lease liabilities is as follows:
2014 2013
£’000 £’000
No later than 1 year 248 44
Later than 1 year and no later than 5 years 408 66
Later than 5 years 242 259
898 369
26. Borrowings continued
Group Group Company Company
2014 2013 2014 2013
£’000 £’000 £’000 £’000 
At 1 January 7,249 5,714 1,778 2,439
On acquisition of subsidiaries 9,785 2,639 9,785 -
Unwinding of discount (note 12) 1,751 685 1,004 55
Fair value adjustment (475) 750 (475) 750
Reduction of provisions (79) (1,108) (79) (850)
Payments made (355) (1,429) (355) (616)
Exchange differences 153 (2) - - 
At 31 December 18,029 7,249 11,658 1,778
Current portion 8,493 1,778 8,493 1,778
Non-current portion 9,536 5,471 3,165 -
27. Deferred consideration
The deferred consideration is made up as follows:
• 4,043,940 Ordinary Shares originally valued at £605,000 to be issued as part of the consideration paid for acquisition of EKF-diagnostic
GmbH Germany. The value of the shares has been adjusted to its fair value at 31 December 2014 of £880,000.
• $4,000,000 contingent consideration payable in respect of the acquisition of Stanbio Laboratory LP. The discounted value at the year-end
amounted to £2,566,000 (2013: £2,352,000). The contingent consideration is mainly based on achieving targets prior to 31 December 2015.
• £8,000,000 contingent consideration payable in respect of the acquisition of 360 Genomics Limited. The discounted value at the year end
amounted to £3,805,000 (2013: £3,119,000). The contingent consideration is based on achieving revenue targets or a sale of the business.
• £1,425,000 consideration for the acquisition of DiaSpect Medical AB. The discounted value at the year end amounted to £1,410,000
(2013: £nil). This was paid in January 2015.
• $17,500,000 contingent consideration payable in Ordinary Shares of the Company as part of the consideration for acquisition of Selah
Genomics, Inc. The contingent consideration is based on achieving revenue targets in the period to 31 March 2016. The discounted value at the
year-end amounted to £9,368,000 (2013: £nil). 
• The contingent consideration payable as part of the consideration for Quotient Diagnostics Limited has been satisﬁ ed in full during the year. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 63
Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against 
current tax liabilities and when deferred income tax assets and liabilities relate to income taxes levied by the same taxation authority 
on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis. The amounts 
concerned are as follows:
 2014 2013 
Group £’000 £’000 
Deferred tax assets
Deferred tax asset to be recovered within 12 months (45) (46)
Deferred tax asset to be recovered after more than 12 months (238) (903)
 (283) (949)
Deferred tax liabilities
Deferred tax liability to be recovered after more than 12 months 13,258 3,442
Deferred tax liability to be recovered within 12 months 756 380
 14,014 3,822
Deferred tax liabilities – net 13,731 2,873
The gross movement on the deferred income tax account is as follows:
 2014 2013 
 £’000 £’000 
At 1 January 2,873 3,193
Exchange differences 438 -
On acquisition of subsidiaries  10,394 804
Effect of reduction in tax rate  - (423)
Income statement movement (note 13)  26 (701)
At 31 December 13,731 2,873
The movement in deferred income tax assets and liabilities during the year, without taking into consideration the offsetting of 
balances within the same tax jurisdiction, is as follows:
 Accelerated tax
 depreciation Total 
Deferred tax liabilities £’000 £’000 
At 1 January 2013 4,210 4,210
Credited to the income statement (652) (652)
On acquisition of subsidiaries 804 804
Impact of deferred tax rate change (539) (539)
Exchange differences  (1) (1)
At 31 December 2013 3,822 3,822
At 1 January 2014 3,822 3,822
Credited to the income statement (638) (638) 
On acquisition of subsidiaries 10,394 10,394
Exchange differences 436 436
At 31 December 2014 14,014 14,014
28. Deferred income tax ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 64
Notes to the Financial Statements continued
for the year ended 31 December 2014
 2014 2013 
Company £’000 £’000 
Deferred tax assets
Deferred tax asset to be recovered after more than 12 months 238 96
Deferred tax  238 96
28. Deferred income tax continued
 
   Share 
 Number of Share capital premium Total
Group and Company shares £’000 £’000 £’000 
    
At 1 January 2014 272,717,369 2,727 41,783 44,510
Issue of shares 149,339,705 1,494 49,493 50,987
At 31 December 2014 422,057,074 4,221 91,276 95,497
The shares issued during the year were as follows:
 
   Number of 
Reason  Date Shares Price 
    
Exercise of share options by former employee  27 January 2014 225,000 18p
Exercise of share options by Mr G Hall  26 March 2014 600,000 1p
In association with the acquisitions of Diaspect Medical AB and Selah Genomics Inc  26 March 2014 14,285,714 35p 
In association with the acquisitions of Diaspect Medical AB and Selah Genomics Inc  17 April 2014 134,228,991 35p
   149,339,705 
Transaction costs in respect of the equity fund raising associated with the acquisitions of Diaspect and Selah of £1,040,000 have 
been offset against the share premium account.
29. Share capital and premium
Deferred tax assets Tax losses Other Total
 £’000 £’000 £’000
At 1 January 2013 (935) (82) (1,017)
Charged to the income statement (35) (14) (49)
Impact of deferred tax rate change 116  116
Exchange differences 1 – 1
At 31 December 2013 (853) (96)  (949) 
   
At 1 January 2014 (853) (96) (949)
Charged to the income statement 806 (142) 664
Exchange differences 2 - 2
At 31 December 2014 (45) (238) (283)
Deferred income tax assets are recognised to the extent that the realisation of the related tax beneﬁ t through future taxable proﬁ ts 
is probable. The Group did not recognise deferred income tax assets of £1,141,000 (2013: £872,000) mainly in respect of tax losses 
amounting to £5,707,000 (2013: £4,154,000) that can be carried forward against future taxable income. EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 65
30. Share options and share-based payments
The shares issued during the year were as follows:
(a) Long-term Incentive Plans (‘LTIP’)
   2014 number 2013 number
   of notional of notional
   shares shares
At 1 January 2014 and 31 December 2014   17,091,276 17,091,276
Long-term incentive plan share awards over notional shares totalling 17,091,276 have been granted to two Executive Directors. The 
key terms of the awards were revised on 11 June 2013. The key terms of the awards relating to the grants noted above are as follows.
a)  1,709,128 notional shares, with an exercise price of 15p will vest if the Company’s mid-market closing share price attains 30 pence 
or higher per share for a period of 20 consecutive days (on which The London Stock Exchange is open for business) at any time 
during the period commencing on 1 January 2011 and ending on 31 December 2016. This condition has been met.
b)  1,709,128 notional shares, with an exercise price of 15p will vest if the Company’s mid-market closing share price attains 37.5 pence 
or higher per share for a period of 20 consecutive days (on which The London Stock Exchange is open for business) at any time 
during the period commencing on 1 January 2011 and ending on 31 December 2016.
c)  1,709,128 notional shares, with an exercise price of 15p will vest if the Company’s mid-market closing share price attains 45 pence 
or higher per share for a period of 20 consecutive days (on which The London Stock Exchange is open for business) at any time 
during the period commencing on 1 January 2011 and ending on 31 December 2016.
d)  1,709,128 notional shares, with an exercise price of 15p will vest if the Company’s mid-market closing share price attains 52.5 pence 
or higher per share for a period of 20 consecutive days (on which The London Stock Exchange is open for business) at any time 
during the period commencing on 1 January 2011 and ending on 31 December 2016.
e)  1,709,126 notional shares, with an exercise price of 15p will vest if the Company’s mid-market closing share price attains 60 pence 
or higher per share for a period of 30 consecutive days (on which The London Stock Exchange is open for business) at any time 
during the period commencing on 1 January 2011 and ending on 31 December 2016.
f)  8,545,638 notional shares, with an exercise price of 15p will vest if the Company’s EBITDA for the year to 31 December 2013 is at 
least 52.0875% (being growth at 15% per annum compounded) higher than twice the EBITDA for the six months to 31 December 
2010. For these purposes EBITDA shall mean EBITDA (earnings before interest, taxes, depreciation and amortisation) as shown in the 
audited ﬁ nancial statements for the period in question, as adjusted to remove any adjustment, accrual or expense in respect of the 
grant of or exercise of the Award granted to the Award holder. This condition has been met.
(b) Unapproved share option scheme
  
 Av. Exercise price Options Av. Exercise price Options
Group and Company per share (£) (Number) per share (£) (Number) 
   
At 1 January 0.224 7,735,000 0.221 7,085,000
Granted 0.359 3,600,000 0.273 1,150,000
Exercised 0.180 (225,000) - -
Forfeited 0.264 (900,000) 0.252 (500,000)
At 31 December 0.270 10,210,000 0.224 7,735,000
The unapproved share options include the following:
2014
2013
• 4,260,000 options were in issue at an exercise price of 20p per share. The shares will vest if the Company’s EBITDA for the year   
 to 31 December 2013 is at least 52.0875% (being growth at 15% per annum compounded) higher than the target adjusted EBITDA   
 of £777,408. All EBITDA contribution from current and future acquisitions of the Company will be used in assessing if the annual   
 compound growth rate is achieved. For these purposes EBITDA shall mean EBITDA (earnings before interest, taxes, depreciation   
 and amortisation) as shown in the audited ﬁ nancial statements for the period in question. This condition has been met.
• 1,700,000 options were in issue to senior employees of the Group at an exercise price of 25.25p per share. The shares will vest if 
 the Company’s EBITDA for the year to 31 December 2013 is at least 52.0875% (being growth at 15% per annum compounded) 
 higher than the target adjusted EBITDA of £777,408. All EBITDA contribution from future acquisitions of the Company will be 
 excluded in assessing if the annual compound growth rate is achieved. For these purposes EBITDA shall mean EBITDA (earnings   
 before interest, taxes, depreciation and amortisation) as shown in the audited ﬁ nancial statements for the period in question. This   
 condition has now been met. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 66
Notes to the Financial Statements continued
for the year ended 31 December 2014
30. Share options and share-based payments continued
• 650,000 options were issued on 7 July 2013 to senior employees at an exercise price of 27.25p per share. These options are
exercisable from the third anniversary of grant with a maximum term of 10 years.
• 1,300,000 options were issued on 21 January 2014 to senior employees at an exercise price of 37.625p per share. These options are
exercisable from the third anniversary of grant with a maximum term of 10 years.
• 1,000,000 options were issued to a director on 17 April 2014 at an exercise price of 35p. The options granted will vest if the
Company’s mid-market closing share price attains the required price or higher for a period of 20 consecutive days at any time
during the period commencing on 17 April 2014 and ending on 17 April 2024.
a) 333,333 of the notional shares will vest if the share price attains 50 pence.
b) 333,333 of the notional shares will vest if the share price attains 60 pence.
c) 333,334 of the notional shares will vest if the share price attains 70 pence.
• 1,300,000 options were issued to a director on 30 May 2014 at an exercise price of 35p. These options are exercisable from the
third anniversary of grant with a maximum term of 10 years.
All share option awards are equity settled. Out of the 10,210,000 (2013: 7,735,000) outstanding options 5,960,000 (2013: 4,485,000) 
were exercisable.
Share options outstanding at the end of the year have the following expiry date and exercise prices:
Exercise price Options Exercise price Options
Expiry Date per share (£) (Number) per share (£) (Number) 
29.01.2014 - - 0.180 225,000
16.06.2021 0.200 4,260,000 0.200 4,260,000
28.09.2021 0.252 1,700,000 0.252 1,700,000
19.04.2022 - - 0.252 400,000
07.07.2023 0.2725 650,000 0.2725 1,150,000
21.01.2024 0.37625 1,300,000 - -
17.04.2024 0.35 1,000,000 - -
30.05.2024 0.35 1,300,000 - -
10,210,000 7,735,000
2014
2013 EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 67
The weighted average fair value of options granted during 2014 determined using the Black-Scholes valuation model was £0.109 
(2013: £0.113). The signiﬁ cant inputs into the model are detailed below:
 2014 2013 
Weighted average share price 31.44p 27.25p
Weighted average option exercise price 36.31p 27.25p
Expected volatility 41.3% 44.6% 
Risk-free interest rate 0.50 0.70
Expected volatility 6.5 years 6.5 years 
Dividend yield - -
Expected volatility was determined by calculating the volatility in the historic share price over a period consistent with the expected 
exercise period of the option. This level of volatility has then been benchmarked by comparing the level of share price volatility for 
other quoted medical diagnostic businesses over a three to ten year period.
The weighted average fair value of options granted during 2014 determined using the Monte Carlo valuation model was  
£0.095 (2013: nil). The signiﬁ cant inputs into the model are detailed below:
 2014 2013 
Share price at date of grant 35p -
Exercise price 35p -
Expected volatility 47.1% -
Risk-free interest rate 0.40% -
Expected option life (years) 1.06 -
Dividend yield - -
Expected volatility was determined by calculating the volatility in the historic share price over a period consistent with the expected 
exercise period of the option. This level of volatility has then been benchmarked by comparing the level of share price volatility for 
other quoted medical diagnostic businesses over a three to ten year period. 
(c) Bonus and share incentive scheme (‘BAPSI’)
   2014 number 2013 number
   of notional of notional
   shares shares
At 1 January   600,000 600,000
Exercised   (600,000) -
At 31 December   - 600,000 
The remaining 600,000 BAPSI options were exercised during the year.
   
 Group Company 
 £’000 £’000 
At 1 January 2013   (3,004) (5,899)
Loss for the year   (1,126) (1,490)
Share-based payment   709 709 
Actuarial gain on pension scheme   9 -
At 31 December 2013   (3,412) (6,680) 
At 1 January 2014
Loss for the year   (5,689) (2,882)
Share-based payment   512 512
Movement on pension scheme   48 -
At 31 December 2014   (8,541) (9,050)
31. Retained earnings ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 68
Notes to the Financial Statements continued
for the year ended 31 December 2014
32. Other reserves
Foreign
currency Other Total
Group £’000 £’000 £’000
At 1 January 2013 (961) - (961)
Currency translation differences 236 - 236
Issue of convertible loan notes in subsidiary - 41 41 
At 31 December 2013 (725) 41 (684)
At 1 January 2014 
Currency translation differences 751 - 751
At 31 December 2014 26 41 67
In return for a payment of £200,000, Andrew Webb has been granted a loan note convertible into equity in EKF Molecular 
Diagnostics Limited. The equity element has been included in other reserves. The debt element is included in borrowings.
2014 2013
Group £’000 £’000
Liability in the balance sheet for pension beneﬁ ts - 103
Income statement charge for: 
Pension beneﬁ ts - 4
Actuarial (gains)/losses recognised in the statement of other comprehensive income in the year (48) (9)
Cumulative actuarial losses recognised in the statement of other comprehensive income - 21
Pension beneﬁ ts
The Group operated a funded deﬁ ned beneﬁ t plan for Berthold Walter, the former owner of EKF-diagnostic GmbH Germany. This 
has now been closed.
The Group operates a deﬁ ned contribution pension scheme the assets of which are held separately from those of the Company in 
an independently administered fund. The pension cost for the year represents contributions made by the Company to the fund and 
amounted to £225,000 (2013: £208,000). 
a) Capital commitments
The Group has contracted approximately £nil (2013 – £0.1m) capital expenditure at the end of the reporting period that had not yet
been incurred.
b) Operating lease commitments
The Group leases various ofﬁ ces and manufacturing buildings under non-cancellable operating lease agreements. The lease terms are
between one and ﬁ ve years.
The Group also leases various ofﬁ ce equipment and assets under non-cancellable operating lease agreements. The lease terms are 
between one and ten years.
The future aggregate minimum lease payments under non-cancellable operating leases are as follows:
2014 2013 2014 2013
Group £’000 £’000 £’000 £’000
No later than 1 year 303 29 126 -
Later than 1 year no later than 5 years 1,344 175 243 89
Later than 5 years 609 665 34 -
Total 2,256 869 403 89
33. Retirement beneﬁ t obligations
34. Commitments
Land and buildings Other EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 69
35. Cash used in operations
  
 2014 2013 2013 2013
 £’000 £’000 £’000 £’000 
   
(Loss)/proﬁ t before tax (4,028) 607 (3,003) (1,458)
Adjustments for:
Depreciation 1,368 1,304 57 51 
Amortisation 3,582 2,250 - - 
Impairment 1,229 750 1,600 583
Warranty claim 281 (1,241) - -
Proﬁ t on disposal of ﬁ xed assets (6) (8) - - 
Proﬁ t on disposal of available-for-sale assets - - - -
Share- based payments 512 709 512 709
Release of deferred consideration (79) (1,108) (79) (850)
Fair value adjustment (476) 750 - 750
Release of provision - (334) - -
Exchange movements on operating activities - - (678) -
Net ﬁ nance costs/(income) 2,031 1,044 (132) 55
Changes in working capital
Inventories 728 (298) - -
Trade and other receivables (8,467) (1,930) (9,829) (404)
Trade and other payables 63 677 (459) 629
Net cash (used in)/generated by operations (3,262) 3,172 (12,011) 65
In the statement of cash ﬂ ows, proceeds from the sale of property, plant and equipment comprise:
 2014 2013 
Group £’000 £’000 
Net book value 16 53
Proﬁ t on disposal of property, plant and equipment 6 8
Proceeds from disposal of property, plant and equipment 22 61
Non-cash transactions
The principal non-cash transactions are the issue of Ordinary shares in relation to the acquisition of DiaSpect Medical AB and Selah 
Genomics Inc.; the release of the deferred consideration provision; the fair value adjustment relating to the deferred equity 
consideration in respect of EKF Germany, the warranty claim, and the impairment charge in relation to Ireland.
Directors
The Group was invoiced £18,000 (2013: £18,000) by J & K (Cardiff) Limited for property rent. Julian Baines is a Director of J & K (Cardiff) Limited.
Directors’ emoluments are set out in the Remuneration Committee report and in note 9.
Key management compensation
Key management compensation for the year was as follows:
 2014 2013 
 £’000 £’000 
Salaries and other short-term employee beneﬁ ts 941 627
Share- based payments 414 663 
Employee contribution to pension scheme 29 8
 1,384 1,298
Key management includes all the Directors only.
The Company
During the year the Company invoiced management charges of £2,526,000 (2013 – £1,485,000) and interest of £726,000 (2013 – £1,180,000) to
its subsidiary companies. It purchased goods and services from subsidiaries totalling £619,000 (2013 – £303,000). At 31 December 2014 the
Company was owed £36,307,000 (2013 – £24,941,000) by its subsidiaries and owed £2,913,000 (2013 – £2,837,000) to other subsidiaries.
Group Company
36. Related Party Disclosures ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 70
Notice of Annual General Meeting
EKF Diagnostics Holdings PLC (Company)
NOTICE IS HEREBY GIVEN that the Annual General Meeting (Meeting) of EKF Diagnostics Holdings plc (Company) will be held at the ofﬁ ces 
of Panmure Gordon & Co, One New Change, 1 New Change, London EC4M 9AF on 19 May 2015 at 2.00 p.m. for the following purposes:
Ordinary Resolutions
1. To receive and adopt the statement of accounts for the year ended 31 December 2014 together with the reports of
 the Directors and the auditors thereon.
2. To re-elect Richard Evans, Tito Bacarese-Hamilton, David Toohey, and Doris-Ann Williams, who retire by rotation,
 as Directors.
3. To re-appoint Messrs PricewaterhouseCoopers LLP as auditors to act as such until the conclusion of the next General Meeting
 of the Company at which the requirements of section 437 of the Companies Act 2006 are complied with and to authorise the
 Directors of the Company to ﬁ x their remuneration.
4. That in substitution for any existing such authority, the Directors be and are hereby generally and unconditionally authorised
 pursuant to section 551 of the Companies Act 2006 (the “2006 Act”) to allot Relevant Securities of the Company:
(i) up to a maximum nominal amount of £273,012.76 (in pursuance of the exercise of outstanding share options granted
by the Company but for no other purpose);
(ii) up to an aggregate nominal amount of £422,057.07 (in addition to the authorities conferred in sub-paragraphs
 (i) above) representing approximately 10% of the Company’s Issued Share Capital,
 such authorities (unless previously renewed, revoked or varied) to expire at the conclusion of the next Annual General 
 Meeting of the Company to be held in 2016, save that the Company may, before such expiry, make an offer or agreement  
 which would or might require Relevant Securities to be allotted after such expiry and the directors may allot Relevant  
 Securities in pursuance of such an offer or agreement as if the authority conferred hereby had not expired.
5. To approve the Directors remuneration report for the ﬁ nancial year ending 31 December 2014. Shareholders should note that
 this vote is advisory only and does not affect the actual remuneration paid to any individual director. The Directors’
 remuneration report is set out in full in the Annual Report.
6. Special Resolution
 That, subject to the passing of the above Resolution the Directors be given the general power to allot equity securities (as
 deﬁ ned in section 560 of the 2006 Act) pursuant to the authority conferred by the Resolution above as if section 561(1) of the
 2006 Act did not apply to any such allotments provided that this power shall be limited to:
(i) the allotment of equity securities on the exercise of the share options granted by the Company;
(ii) the allotment of equity securities (otherwise than pursuant to sub-paragraphs (i) above) for cash in connection with
any  rights issue or pre-emptive offer in favour of holders of equity securities generally; and
(iii) the allotment (otherwise than pursuant to sub-paragraphs (i) and (ii) above) of equity securities for cash up to
an aggregate  nominal amount of £422,057.07 representing approximately 10% of the Company’s Issued Share Capital;
 provided that such power (unless previously renewed, revoked or varied) shall expire at the conclusion of the Annual 
 General Meeting of the Company to be held in 2016, save that the Company may, before such power expires, make an offer or 
 enter into an agreement which would or might require equity securities to be allotted after such power expires and the  
 Directors may allot equity securities in pursuance of any such offer or agreement notwithstanding that the power conferred   
 by this resolution has expired.
Registered Ofﬁ ce 
BY ORDER OF THE BOARD
Avon House Paul Foulger
19 Stanwell Road  Director and Company Secretary
Penarth 
CF64 2EZ
16 March 2015 EKF Diagnostics Holdings plc  |  ANNUAL REPORT 2014 71
Notes:
(1) The Company speciﬁ es that only those members registered on the Company’s register of members at 6.00 p.m. on 17 May 2015 or if 
this general meeting is adjourned, at 6.00 p.m. on the day two days prior to the adjourned meeting shall be entitled to attend and
vote at the General Meeting.
(2) If you are a member of the Company at the time set out in note 1 above, you are entitled to appoint a proxy to exercise all or any
of your rights to attend, speak and vote at the General Meeting and you should have received a Proxy Form with this notice. You can
only appoint a proxy using the procedures set out in these notes and the notes to the Proxy Form.
(3) A proxy does not need to be a member of the Company but must attend the General Meeting to represent you. Details of how to
appoint the chairman of the General Meeting or another person as your proxy using the Proxy Form are set out in the notes to the
Proxy Form. If you wish your proxy to speak on your behalf at the General Meeting you will need to appoint your own choice of proxy
(not the chairman) and give your instructions directly to them.
(4) You may appoint more than one proxy provided each proxy is appointed to exercise rights attached to different shares. You may not 
appoint more than one proxy to exercise rights attached to any one share. To appoint more than one proxy, please contact the
Company’s registrars at the address set out in note 5.
(5) The notes to the Proxy Form explain how to direct your proxy how to vote on each resolution or withhold their vote.
To appoint a proxy using the Proxy Form, the Proxy Form must be:
(a) completed and signed;
(b) sent or delivered to Capita Asset Services, PXS, 34 Beckenham Road, Kent BR3 4TU; and
(c) received by Capita Asset Services, at the address provided in paragraph 5(b) above no later than 2.00 p.m. on 17 May 2015.
In the case of a member which is a company, the Proxy Form must be executed under its common seal or signed on its behalf
by an ofﬁ cer of the company or an attorney for the company.
Any power of attorney or any other authority under which the Proxy Form is signed (or a duly certiﬁ ed copy of such power or
authority) must be included with the Proxy Form.
(6) In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, only the appointment submitted by 
the most senior holder will be accepted. Seniority is determined by the order in which the names of the joint holders appear in the
Company’s register of members in respect of the joint holding (the ﬁ rst-named being the most senior).
(7) To change your proxy instructions simply submit a new proxy appointment using the methods set out above. Note that the cut-off 
time for receipt of proxy appointments (see above) also apply in relation to amended instructions; any amended proxy appointment 
received after the relevant cut-off time will be disregarded.
Where you have appointed a proxy using the hard-copy proxy form and would like to change the instructions using another hard-
 copy proxy form, please contact Capita Asset Services at the address noted in note 5 above.
If you submit more than one valid proxy appointment, the appointment received last before the latest time for the receipt of proxies 
will take precedence.
(8) In order to revoke a proxy instruction you will need to inform the Company by sending a signed hard copy notice clearly stating your 
intention to revoke your proxy appointment to Capita Asset Services at PXS, 34 Beckenham Road, Kent, BR3 4TU. In the case of a
member which is a company, the revocation notice must be executed under its common seal or signed on its behalf by an ofﬁ cer of
the company or an attorney for the company. Any power of attorney or any other authority under which the revocation notice is
signed (or a duly certiﬁ ed copy of such power or authority) must be included with the revocation notice.
The revocation notice must be received by Capita Asset Services no later than 2.00 p.m. on 17 May 2015.
If you attempt to revoke your proxy appointment but the revocation is received after the time speciﬁ ed then, subject to the 
paragraph directly below, your proxy appointment will remain valid.
Appointment of a proxy does not preclude you from attending the general meeting and voting in person. If you have appointed a 
proxy and attend the general meeting in person, your proxy appointment will automatically be terminated.
(9) A corporation which is a member can appoint one or more corporate representatives who may exercise, on its behalf, all its powers as
a member provided that no more than one corporate representative exercises power over the same share.
(10) Voting on all resolutions will be conducted by way of a poll rather than on a show of hands.
(11) As at 5.00 p.m. on the day immediately prior to the date of posting of this notice, the Company’s issued share capital comprised
422,057,074 Ordinary Shares of 1p each. Each ordinary share carries the right to one vote at a general meeting of the Company and,
therefore, the total number of voting rights in the Company as at 5.00 p.m. on the day immediately prior to the date of posting of this 
notice is 422,057,074. ANNUAL REPORT 2014  |  EKF Diagnostics Holdings plc 72
Company Information
EKF Diagnostics Holdings PLC (Company)
Directors:
David Evans (Executive Chairman)
Julian Baines (Chief Executive Ofﬁ cer)
Richard Evans (Chief Operating Ofﬁ cer)
Paul Foulger (Finance Director and Company Secretary)
Tito Bacareses-Hamilton (Chief Technology Ofﬁ cer)
David Toohey (Non-Executive Director)
Doris-Ann Williams (Non-Executive Director)
Kevin Wilson (Non-Executive Director)
Adam Reynolds (Non-Executive Director)
Registered Ofﬁ ce and Head Ofﬁ ce:
Avon House 
19 Stanwell Road 
Penarth
Cardiff 
CF64 2EZ
Place of incorporation:
England and Wales (Company number – 4347937)
Independent Auditors:
PricewaterhouseCoopers LLP
Chartered Accountants and Statutory Auditors
One Kingsway
Cardiff
CF10 3PW
Nominated Advisor and Broker:
Panmure Gordon & Co
One New Change
London
EC4M 9AF
Solicitors to the Company:
Berry Smith LLP
Haywood House
Dumfries Place
Cardiff
CF10 3GA
Registrars:
Capita Asset Services
PXS
34 Beckenham Road
Beckenham
Kent
BR3 4TU
If you have a query regarding your shareholding please call 0871 
664 0300 (calls cost 10p per minute plus network extras) or e-mail 
ssd@capitaregistrars.com
Public relations:
Walbrook PR Limited
4 Lombard Street
London
EC3V 9HD
Investor relations email:
investors@ekfdiagnostics.com Designed by Washington Design Consultants
www.washdesign.co.uk  |  +44 (0)29 20 711911 EKF Diagnostics Holdings plc
Avon House, 
19 Stanwell Road, 
Penarth, 
Cardiff 
CF64 2EZ
Tel: +44 (0)29 20 710570
Fax: +44 (0)29 20 705715
Email: investors@ekfdiagnostics.com
ekfdiagnostics.com