Leading  
in a global 
market
Zytronic plc 
Annual report and financial statements 2008
Zytronic plc
Whiteley Road 
Blaydon-on-Tyne 
Tyne & Wear NE21 5NJ 
T el:  0191 414 5511 
Fax:  0191 414 0545 
Email: info@zytronic.co.uk 
Web:  www.zytronic.co.uk
Zytronic plc Annual report and financial statements 2008 Zytronic is the developer and manufacturer of 
a unique range of internationally award-winning 
touch sensor products. These products 
employ an embedded sensing element 
and are based on projected capacitive 
technology (“PCT™”). PCT offers significant 
durability, environmental stability and optical 
enhancement benefits to system designers 
of integrated electronic displays, beyond 
that which was previously attainable.
Zytronic is also an industry leader in the 
development and manufacture of customised 
optical filters to enhance electronic display 
performance and an innovator in the production 
of specialised and transparent laminates for 
niche markets.
Operating from three modern factories near 
Newcastle-upon-T yne in the United Kingdom, 
Zytronic assembles touch sensors, optical 
filters and other laminates, using special 
glass and plastic materials, in environmentally 
controlled clean rooms.
 1 Highlights
 2 Chairman’s statement
 4 Our markets, at a glance
 6 What we do, at a glance
 8 Chief Executive’s review
 12 Financial review
 15 Directors
 16 Corporate information
 17 Directors’ report 
 20 Corporate governance
 23 Remuneration report
 27 Independent auditors’ report 
 28 Consolidated income statement 
 28  Consolidated statement of recognised 
income and expense
 29 Consolidated balance sheet
 30	 Consolidated	cashflow	statement
 31	 Notes	to	the	financial	statements	
 57 Five year summaries
 59  Statement of Directors’ responsibilities in relation 
to	the	P arent	Company	financial	statements
 60 Parent Company auditors’ report
 61 Parent Company balance sheet
 62	 Notes	to	the	P arent	Company	financial	statements
 67 Notice of annual general meeting
Corporate statement 1
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Highlights
Financial highlights 
I  Group sales revenue of £14.7m increased by 29% 
(2007: £11.4m)
I Growth of 47% in touch sensor sales
I Zypos
® 
touch sensor sales increased by 83%
I ZyToUCH
®
 touch sensor sales increased by 34%
I strong recovery, and continuing growth, in ATM sector
I 	 Profit 	 before 	 tax 	 increased 	 to 	 £1.74m 	 (2007: 	 £0.68m) 	
I	 EPS 	 increased 	 to 	 7.3p 	 (2007: 	 3.6p)
I “ Adjusted” Eps increased to 8.4p (2007: 3.5p)
I  Final dividend proposed of 3.0p – total for year 4.0p 
(2007: 3.0p)
Operational highlights
I Increasing sales of Zypos touch sensors
I  Completion of investment in refurbishment and equipping 
of freehold property for new manufacturing facility
2004 8,756
2006 12,301
2007 11,437*
2008 14,717*
2005 10,590
Sales revenue (£’000) Operating profit 
(“PBIT”) (£’000) 
Gross profit margin (%) Earnings per share 
(“EPS”) (pence) 
2004 29.3
2004 370
2004 1.7
2006 31.3
2006 1,326
2006 7.8
2007 30.3*
2007 683*
2007 3.6*
2008 32.2*
2008 1,740*
2008 7.3*
2005 31.0
2005 1,001
2005 4.7
* IFRs 2
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Summary of Chairman’s statement
I Continued strong growth of touch sensor sales, increased 47%
I	 Increased	ge ographical	and 	industrial	diversification
I	 Pre-tax	profit	increased	155%	to	£1.74m	(2007:	£683,000)
I	 T ax	rate	of	39%	(2007:	22%)
I	 Reported	bas ic	EPS	of	7.3p	 (2007:	3.6p)
I “Adjusted” Eps of 8.4p (2007: 3.5p)
I	 Proposed	fin al	dividend	incre ased	to	3.0p	(2007:	2.0p)
I	 Net	cash	bala nces	of	£651,0 00	(2007:	£140,000)
I year end gearing reduced to 11% (2007: 20%)
I Net cash balances and unused banking facilities of £4.1m
T h e 	 y e a r 	 u n d e r 	 r e v i e w 	 h a s 	 s e e n 	 s i g n i fi c a n t	
improvement in both turnover and Group 
p r o fi t a b i l i t y . 	 C o n t i n u e d 	 s t r o n g 	 g r o w t h 	 i n 	 s a l e s	
of touch sensors, together with the new 
manufacturing facilities which were fully 
commissioned in January 2008, has led to 
a substantial improvement in trading results.
Results
T h i s 	 i s 	 t h e 	 fi r s t 	 y e a r 	 i n 	 w h i c h 	 w e 	 h a v e	
presented our accounts under International 
Financial Reporting standards (“IFRs”).
Turnover for the year under review has 
increased by 29% to £14.7m (2007: £11.4m).
The new manufacturing facilities, which 
were fully commissioned in January 2008, 
have enabled further improvements in our 
m a n u f a c t u r i n g 	 e f fi c i e n c y , 	 t h e 	 b e n e fi t s 	 o f	
which will be more fully realised in 2009 and 
2010. This year, gross margins improved by 
1.9%, from 30.3% to 32.2% and this increase, 
together with the growth in sales, has led 
t o 	 a n 	 i n c r e a s e 	 i n 	 p r e - t a x 	 p r o fi t s 	 t o 	 £ 1 . 7 4 m	
( 2 0 0 7 : 	 £ 0 . 6 8 m ) . 	 O u r 	 r e p o r t e d 	 b a s i c 	 e a r n i n g s	
per 	 share 	 increased 	 to 	 7.3p 	 (2007: 	 3.6p).
In July 2008, the Finance Act 2008 enacted 
the abolition of Industrial Building Allowances 
(“IBAs”) and, as a consequence, we have 
i n c u r r e d 	 a 	 o n e - o f f 	 d e f e r r e d 	 t a x 	 c h a r g e 	 o f	
£174,000. As a result of this, our reported 
t a x 	 r a t e 	 i s 	 3 9 % . 	 A d j u s t i n g 	 f o r 	 t h i s 	 o n e - o f f	
d e f e r r e d 	 t a x 	 c h a r g e , 	 o u r 	 “ A d j u s t e d ” 	 E P S 	 h a s	
increased by 140% to 8.4p (2007: 3.5p). 
Trading
The sales growth of 29% in the year under 
review has been led primarily by the increase 
in sales of the Group’s touch sensor products, 
which have grown by almost 47% and 
constitute 58% of the Group’s total sales.
Exports	now	account	for	over	79%	of	total	
sales with the fastest area of geographical 
growth being the Far East where sales 
have doubled. The split is as follows:
  FY2008 Fy2007 
   £m £m
UK  3.0  4.1
Americas   3.3		 2.6
EMEA	(excl.	UK)	 	 	6.1	 	3.6
Asia	P acific	 	 	2.3  1.1
T otal   14.7  11.4
Whilst ATMs still account for the largest 
i n d u s t r i a l 	 g r o u p 	 o f 	 t o u c h 	 s e n s o r 	 s a l e s 	 a t 	 £ 3 . 6 m ,	
it is the area of gaming which has shown 
the	fastest	growth,	where	first	year	sales	
in this market have reached almost £1m. 
The Group has a number of projects 
awaiting approval in the areas of self‑service, 
information systems, kiosks, digital displays, 
music centres and industrial control systems 
and there is likely to be further growth in the 
gaming sector.
our Zypos product is winning most of its 
new business in the gaming, self‑service and 
information markets and sales of Zypos touch 
sensors in the year ended 30 september 2008 
have grown by 83% over the prior year. 
Cash 
The 	 cashflows 	 resulting 	 from 	 this 	 year’s 	
earnings	before	interest,	tax,	depreciation	
and amortisation (“EBITDA”) of £2.7m 
(2007: £1.5m) have enabled the Group 
to reduce the net gearing ratio to 11% 
(2007: 20%) after taking account of net cash 
b a l a n c e s 	 o f 	 £ 6 5 1 , 0 0 0 	 ( 2 0 0 7 : 	 £ 1 4 0 , 0 0 0 ) .	
T h i s 	 s i g n i fi c a n t 	 r e d u c t i o n 	 i n 	 g e a r i n g 	 h a s	
arisen 	 despite 	 additions 	 to 	 fixed 	 assets 	
of £918,000, including completing the 
investment in the new manufacturing 
facilities, which have cost £3.2m, over the 
last three years. The Directors anticipate 
only	modest	capital	expenditure	on	new	
plant and equipment will be necessary to 
further	expand	the	new	facilities’	capacity	
when required.
At 30 september 2008, the Group had cash 
balances and unused banking facilities at 
its disposal of £4.1m.
Technology
The continuing growth of ZyToUCH 
products, together with the growth of the 
newly introduced Zypos products, which 
have a lower cost base and consequently a 
lower selling price, has clearly demonstrated 
the market acceptance of Zytronic’s underlying 
projective capacitive technology.
Throughout 2008 the R&D team has 
initiated several programmes to continue 
the development and advancement of 
the electronics associated with Zytronic’s 
principal technology and also to evaluate 
new sensing materials. 
All of the programmes are still on‑going and 
will draw to their conclusions in 2009, at which 
point they will aid further reductions in the cost 
of manufacture as volumes increase.
Dividend
The Directors are pleased to recommend 
a	final	dividend	of	3.0p	per	share	payable	
on 9 March 2009 to shareholders on the 
Register of Members on 20 February 2009. 
Following a dividend of 1.0p per share paid 
on 27 June 2008, this will bring the total 
dividend for the year to 4.0p per share 
(2007: 3.0p per share).
Chairman’s statement
Top opposite: Scheidt & Bachmann has used our ZYPOS 
touch sensor in its fuel distribution systems, to take account 
of the harsh environmental circumstances and rough 
treatment to which they are subjected.
Bottom opposite: Inside a milking parlour in New Zealand, 
the touch sensor is used to control this modern set-up. 
Power-washing the equipment demonstrates its ruggedness 
and is necessary as it has been soiled by a passing cow . 3
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
A number of new customer programmes, 
where Zytronic’s products are on field trial 
or awaiting final approval, together with 
the strength of the order book over the 
first quarter of the new financial year, 
lead the Directors to be confident of the 
prospects of the Group going forward. 
Management
In my statement in May, in the interim results, 
I reported that Mark Cambridge had been 
appointed 	 to 	 the 	 position 	 of 	 Chief 	 Executive	
of the Group on 21 January 2008. Mark’s 
depth of knowledge of the Group and, 
in particular, our technology and the markets, 
is clearly standing him in good stead as 
evidenced by these results. The Directors 
a r e 	 c o n fi d e n t 	 t h a t 	 t h e 	 s t r o n g 	 m a n a g e m e n t	
team will continue to be very successful 
in the coming years.
Outlook
The	financial	crisis	which	is	affecting	all	
countries in the world and which, in the past 
few months, has begun to impact on the wider 
economy is clearly of serious concern to 
everyone. However, the Zytronic Group has 
unique patented technology, a wide industrial 
and geographical base of customers and 
a number of new technical development 
programmes, to be introduced in 2009, which 
will further reduce the cost base of the touch 
sensor products. These factors, combined 
with strong operating cash generation 
and a low level of gearing, are important, 
if not essential, for any sME to weather the 
d i f fi c u l t i e s 	 t h a t 	 m a y 	 b e 	 e n c o u n t e r e d 	 i n 	 2 0 0 9 .	
A number of new customer programmes, 
where	Zytronic’s	products	are	on	field	trial	
or	awaiting	final	approval,	together	with	
the strength of the order book over the 
fi r s t 	 q u a r t e r 	 o f 	 t h e 	 n e w 	 fi n a n c i a l 	 y e a r ,	
lead	the	Directors	to	be	confident	of	the	
prospects of the Group going forward. 
John M Kennair MBE
Chairman
19 December 2008 4
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
The	Group	has	expanded	its	customer	base	and	
distribution and representation networks over recent 
years so that it now sells into most of the world’s 
leading economies. 
S i n c e 	 2 0 0 5 , 	 w e 	 h a v e 	 e x p a n d e d 	 o u r 	 o v e r s e a s	
r e p r e s e n t a t i o n 	 s i g n i fi c a n t l y . 	 W e 	 n o w 	 h a v e 	 r e p r e s e n t a t i v e s	
covering all of the Us and Canada, and distributors 
covering 9 countries in the Far East and 23 countries 
in EMEA (Europe, Middle East and Africa).
The range of applications for our touch sensors 
is as wide as the imagination of leading designers. 
It includes use in ATMs, petrol pumps, ticketing 
machines, information displays, gaming machines, 
f o o d 	 r e t a i l i n g , 	 j u k e b o x e s , 	 m e d i c a l 	 e q u i p m e n t , 	 k e y p a d s ,	
solar powered parking meters, diagnostic engineering 
equipment and helicopter simulation machines. There 
are many other and more varied uses. photographs 
of some of the applications are included in this year’s 
annual report.
Our markets, at a glance
Americas
sales in North and south America have continued to 
increase during Fy2008, with growth coming from both 
existing	customers	and	many	new	customers.	W e	have	
experienced	further	growth	in	South	America,	especially	
Brazil. sales of Zypos touch sensors have been particularly 
strong and these sensors are now being used in a wide 
range of applications including gaming, self‑service, 
vending and information kiosks. 
29% 67%
Growth in sales (Americas) 5
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Europe, Middle East and Africa (“EMEA”)
The EMEA region, by sales value, presently represents the 
largest	market	for	Zytronic	products	and	continues	to	exhibit	
good growth. sales into the UK still represent the largest single 
country entity within EMEA, but it is now closely followed by 
sales to Hungary. Direct product sales to EMEA countries are 
represented by a broad range of application uses, such as 
A TMs,	information	kiosks,	self -service	systems	and	jukeboxes.
Asia Pacific (“APAC”)
Sales	in	the	Asia	P acific	region	have	more	than	doubled	from	
those of 2007. A number of positive factors have driven this, 
including a growing deployment programme of ATMs in 
mainland China and an increase in Zypos sales to the digital 
signage and gaming market providers in both south Korea 
and T aiwan.
67% 105%
Sales 2007 £m Sales 2008 £m
 Americas
 EMEA excl. UK
 UK
 Asia Pacific
 Americas
 EMEA excl. UK
 UK
 Asia Pacific
Growth in sales (Asia Pacific) Growth in sales (EMEA excl. UK)
4.1
1.1
2.6
3.6
6.1
3.0
2.3
3.3 6
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Touch screens
The manufacturing technology, pCT , 
employed for its touch sensors is unique 
to	Zytronic	and	offers	significant	benefits	
to traditional users of resistive, capacitive 
and surface Acoustic Wave (“sAW”) 
technologies. Unlike the other touch 
technologies, the active component 
of Zytronic’s technology is embedded 
for protection, providing a true safety 
laminated, pure glass fronted construction.
PCT	offers	significant	benefits	to	
electronic display manufacturers. 
The touch sensing layer consists of 
an	array	of	microfine	wires	that	are	not	
visible on a powered display. Zytronic 
has now introduced a family of glass‑based 
touch sensors using its patented pCT , 
marketed as ZyToUCH, Zypos, ZyBRID
®
 
and ZysWITCH
®
 touch sensors, and two 
plastic‑based touch sensors ZyFILM
® 
and ZypRoFILM
®
, to meet customers’ 
differing requirements.
Optical filters and displays
Zytronic 	 optical 	 filters 	 are 	 used 	 to 	
enhance the readability of all types of 
electronic displays by controlling light 
transmission,	reflection	and	absorption.	
T h e 	 fi l t e r s 	 c a n 	 a l s o 	 p r o v i d e 	 p r o t e c t i o n	
of the display from abrasion and impact 
damage	thereby	extending	the	life	of	
the display.
Both monolithic and multi‑ layer 
composites in glass or polycarbonate 
or acrylic are available. The optical 
laminations are manufactured by 
bonding together, under carefully 
controlled conditions, two or more 
glass or plastic materials using 
proprietary bonding techniques. 
Zytronic produces a wide range of 
o p t i c a l 	 fi l t e r s 	 w h i c h 	 a r e 	 d e s i g n e d 	 t o	
meet	specific	customer	requirements	
for viewability of display systems in 
different environments.
EMI/RFI shielded filters 
Electromagnetic Interference (“EMI”) 
can be described as any form of 
electrical disturbance, signal or noise 
which interferes with the ability of 
electrical or electronic equipment 
to function correctly.
This interference is also referred to 
as Radio Frequency Interference (“RFI”) 
and is active throughout the environment. 
Its effects vary from impaired TV or 
radio reception to severe disruption 
of communications, data processing 
and medical and defence activities. 
Its sources are both natural and 
man‑made. It is also necessary to 
contain emitted signals from computer 
and data handling equipment to prevent 
electronic	eavesdropping	for	example.
Zytronic has its own specialist plating 
plant to enable it to manufacture such 
filters 	 to 	 customers’ 	 exacting 	 specifications.
What we do, at a glance
Electronic display products
End users 7
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Laminated products 
Laminated glass is produced by bonding 
two or more layers of glass together by 
means of a special plasticised interlayer, 
polyvinyl butyral (“pVB”).
This interlayer, after processing under 
controlled heat and pressure conditions, 
assumes	a	similar	refractive	index	to	the	
glass – consequently having no adverse 
effects upon light transmission – and 
at the same time, absorbing over 99% 
of the harmful ultraviolet rays found in 
natural	sunlight.	The	excellent	bond	
strength of the pVB to glass serves 
to maintain the integrity of the laminate 
in the event of deliberate or accidental 
damage, whilst also preventing penetration 
through the assembly.
Ballistic visors 
Zytronic is a manufacturer of specialist glass 
and plastic composites for ballistic security 
and specialised display applications.
Zytronic has developed a fully laminated 
ballistic face visor combining the properties 
of pMMA and polycarbonate bonded 
together using a proprietary TpU 
sheet interlayer.
The unique process involved in bonding 
these	two	materials	results	in	the	finished	
visor offering supreme optical quality, 
minimal distortion and the highest light 
transmission when compared to the 
traditional air‑spaced option.
Other products
I ATMs 
I Taxi Cabs 
I Jukeboxes 
I Self‑Service Systems
I Medical Equipment 
I Information Points 
I Gaming Technology
I Point of Sale 8
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Trading results
2008 sales
As reported in the Chairman’s statement, 
the Group’s sales for 2008 were £14.7m, 
(2007: 	 £11.4m), 	 reflecting 	 an 	 increase 	
of 29% over the previous year. 79% of sales 
were	exports	reflecting	the	increasing	global	
efforts of our sales team, distributors and 
representatives. The increase in the sales 
performance	has	been	significantly	driven	
by the sales of our projected capacitive 
technology (“pCT™”) touch sensor products 
as we continue to roll them out globally and 
increase the application appeal through 
the uptake of the Zypos product line. 
Key features in the growth of the Group 
are set out below. 
Continued growth of touch sensor sales 
The total growth in the Group’s touch 
product sales compared with 2007 
was 47% (2008: £8.5m, 2007: £5.8m). 
These products accounted for 58% of 
the total Group sales, compared with 
51% in 2007. 
The sales value of our ultra robust 
ZyToUCH touch sensor product grew 
by 34% (2008: £5.9m, 2007: £4.4m). 
The increased growth was attributable 
to a return of more normal, and growing 
sales levels throughout 2008 to our ATM 
customers, as discussed overleaf, and 
by	n e w 	 p r o j e c t 	 o p p o r t u n i t i e s 	 i n 	 e x t e r n a l	
self‑service ticket machine deployments.
sales of our Zypos products 
demonstrated good growth at 85% 
(2008:	£2.5m,	2007:	£1.4m),	reflecting	
substantial design and supply wins 
predominantly with gaming and wagering 
terminal manufacturers, plus self‑service 
and information system manufacturers. 
We have continued to see increasing 
geographical sales in our touch sensor 
products,	where	we	have	exported	over	
87% of our total touch sales, of which 
half	were	exports	of	ZYTOUCH	to	our	
ATM customers. The table below shows 
the percentages of 2008 touch sensor 
export	sales	(excluding	those	to	our	
ATM customers), the corresponding 
percentages for 2007 and the relative 
percentage growth rates achieved: 
  2007 2008  
 Non‑ATM Non-ATM  
 touch touch  
 sensor sensor 2008  
 sales sales Growth 
E M E A 	 ( e x c l . 	 U K ) 	 	 56%		 59%  45%
ApAC  15%  23%  110%
Americas 28%  19%  (9)%
The	decline	in	growth	exhibited	in	the	
Americas was due, in the main, to the 
fulfilment 	 of 	 the 	 deployment 	 project 	
f o r 	 t h e 	 N e w 	 Y o r k 	 t a x i 	 c a b 	 c u s t o m e r	
infotainment units.
As mentioned in the research and 
development review in the 2007 results, 
we initiated in 2008 the market introduction 
of a number of plastic‑ based pCT touch 
sensor products, developed for the growing 
interactive shop window advertisement 
markets. We have called these products 
ZyFILM and ZypRoFILM. sales in 2008 
were a modest £52,000, up from £8,000 
in 2007.
Although contributing a small level of 
turnover, these products, coupled with the 
previously released ZysWITCH
®
 product, 
are considered important to ensuring 
that Zytronic maintains its leading global 
position as the total product solution 
provider for all large form factor projected 
capacitive sensing display applications.
The net result of the improved Zypos sales 
and non‑ATM based ZyToUCH sales, plus 
the modest introduction of the other sensor 
variants, contributed to an overall growth in 
sales	of	touch	sensor	products,	excluding	
those to our ATM customers, of 38% over 
that of 2007.
Chief Executive’s review
Summary of Chief Executive’s review
I sales revenues increased 29% to £14.7m
I Continued strong growth of touch sensor sales, increased by 47%
I	 Increased	ge ographical	and 	industrial	diversification
I	 Strong	recov ery	in	A TM	mark ets,	above	2006	peak	levels
I Zypos sales increased by 85%
I Good progress with R&D activities
I New manufacturing facility fully commissioned
Top opposite: An Aeroflex 6413A Base Station 
Test System incorporating a ZYTOUCH sensor.
Bottom opposite: On street public information kiosks 
use the ZYTOUCH sensor for their qualities of external 
ruggedness and clarity, as here in Verhaert Ghent, 
in Belgium. 9
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
The ATM customers’ touch sensor 
and display sales
Having undertaken their planned restructuring 
and/or implemented the use of their Vendor 
Managed Inventory (“VMI”) programmes, 
during 2007, I am pleased to report that 
sales of products into our ATM customers 
returned to more normal operating levels. 
Sales	increased	to	6%	above	the	previous	
peak	achieved	in	FY2006.	
Along with providing actual usage data on 
the	customer ,	an	added	benefit	of	the	VMI	
programmes is the smoothing effects that 
they facilitate in production scheduling as, 
once initiated, replenishment cycling of the 
stocks is matched to the customer’s draw 
down cycles. This therefore alleviates 
the traditional ‘stop/start’ type of supply 
previously 	 experienced.
sales to our customers in the ATM market 
are now mainly concentrated on three 
manufacturing countries being, in order 
of increasing sales value, China, the UsA 
and Hungary, in all of which we have active 
VMI programmes. As the distribution of 
global manufacturing centres increases we 
are now also making sales, albeit presently 
at much lower levels, to facilities in both 
Brazil and India.
sales in 2008 to our ATM customers have 
increased by 43% compared with 2007 
and	by	6%	compared	with	2006.	
Sales of our ZYPOS products 
demonstrated good growth at 85% 
(2008: £2.5m, 2007: £1.4m), reflecting 
substantial design and supply wins 
predominantly with gaming and wagering 
terminal manufacturers, plus self-service 
and information system manufacturers.  10
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Trading results (continued)
2008 sales (continued)
sales of non‑ATM display products
sales of other non‑ATM display products 
such as RFI/EMI shielding and anti‑vandal 
panels for the emerging large form factor 
digital display markets etc, remained stable 
during 2008 (2008: £1.5m, 2007: £1.5m). 
This relative stability was maintained despite 
the natural conclusion of one customer’s 
project	which	had	contributed	£262,000	
of sales in 2007, and whose volume 
was effectively replaced by sales to other, 
and new, customers.
Research & Development (“R&D”)
Throughout 2008 the R&D team has 
focused increasingly on the development 
of the capabilities of the electronic controllers 
used in our pCT products and has also 
initiated several programmes to evaluate 
new sensing materials.
In particular, two major development 
programmes were initiated during the 
year to improve the control electronics 
associated with pCT touch sensing. 
The 	 first 	 programme 	 was 	 to 	 move, 	
and ultimately improve, the digital signal 
processing capabilities associated 
with the technology towards industry 
standardisation of an ARM
®
 based 
architecture processor. 
The second programme was to look at 
the analogue based componentary and 
circuitry associated with the Zytronic pCT 
sensing system and to develop a single 
application	specific	integrated	circuit	
‘AsIC’ chip as a replacement. 
The combination of both programmes 
is a very powerful tool in the future growth 
of Zytronic pCT sensing products, allowing 
for a substantial footprint reduction of 
the controller card. It also increases the 
probability of supplying sensor and chip 
only solutions to prospective large volume 
customers, enabling them to integrate the 
solution directly into their own products’ 
motherboards, where required.
The R&D team has also initiated several 
programmes to evaluate new sensing 
material for use in the sensor designs to aid 
improvements in manufacturing processing 
and facilitate product improvements. 
All of the above programmes are on‑going 
and will be completed in 2009.
Production
The manufacturing stability provided 
by the VMI programmes, coupled with 
the increasing production, through the 
new manufacturing facility, allowed for 
a consistent monthly manufacturing 
schedule during 2008. subsequently 
the production department was able to 
maintain stable employee numbers, with 
an	average	workforce	of	167	(2007:	153).	
Manufacture of the Zypos product was fully 
transferred from an intermediate production 
facility to the new manufacturing facility in 
the	first	quarter	of	2008	fiscal.	It	was	not	until	
the end of January 2008 that the new facility 
was fully operational with all of the original 
design	specification	equipment	in-situ.
In	addition	to	the	2008	capital	expenditure	
on the new facility, only two other major 
items of plant and equipment were purchased 
during 	 2008. 	 The 	 first 	 was 	 an 	 additional 	
CNC edge grinding machine, introduced 
during December, to meet the increasing 
demand in glass preparation. The second 
was the enhancement/replacement of the 
air conditioning plant for the oldest of 
the cleanroom suites, the work being 
undertaken during August.
Chief Executive’s review
continued
Zytronic’s ZYBRID sensor has enabled Fiscal Systems to 
create an integrated travel centre and convenience store 
for filling-station forecourt applications, tough enough for 
outdoor use in unsupervised areas.
Laminated shielded windows and doors are manufactured 
by Zytronic to stop interference from the flow of radio and 
electromagnetic waves (RFI/EMI). These shielded doors 
are being used in ABB telephone racks. 11
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Personnel
During the year, the Group maintained a 
consistent	staff	profile.	Three	appointments	
were made during the year to replace leavers. 
The opportunity was taken to improve 
capabilities and the structure of the 
Company to assist future growth. 
We have continued with the development 
of 	 our 	 employees 	 through 	 a 	 mixture 	 of	
on 	 the 	 job 	 training 	 and 	 external 	 courses.	
At the end of september we had over 
2 0 0 	 e m p l o y e e s 	 a n d 	 w e 	 e x p e c t 	 t o 	 s e e	
that number steadily grow in 2009. 
The Directors were pleased to offer our 
employees the opportunity to participate 
in our second sAyE sharesave scheme. 
I was delighted that so many joined, 
d e m o n s t r a t i n g 	 t h e i r 	 c o n fi d e n c e 	 i n 	 t h e	
future development and success of 
the Group’s business. 
I personally, along with the Group’s other 
management, would like to thank all of our 
employees for their good work during 2008 
and for their continuing contribution to the 
success and development of the Group.
Mark Cambridge, B.Sc
Chief Executive
19 December 2008
Throughout 2008 the R&D team has 
focused increasingly on the development 
of the capabilities of the electronic 
controllers used in our PCT products and 
has also initiated several programmes 
to evaluate new sensing materials.
Top: An application at the University of Pittsburgh 
illustrates the flexibility of PCT. By combining a 
ZYTOUCH touch sensor with large convex glass panels 
and rear-projection display technology , the University 
has been able to present a permanent interactive 
exhibition using a series of 8ft diameter kiosks. 
Bottom: One of the features of the Pittsburgh touch sensors 
is a genealogy feature, seen here in use by a visitor. 12
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
International Financial Reporting 
Standards (“IFRS”)
F o r 	 t h e 	 fi r s t 	 t i m e , 	 t h e 	 G r o u p 	 i s 	 r e p o r t i n g 	 u n d e r	
IFRs for the year ending 30 september 2008. 
We issued our transitional document 
in May 2008, just before we issued our 
interim	results.	As	expected	there	were	no	
significant	changes	to	the	Group’s	results	
arising from the changes in accounting 
policies and the impact on the reported 
results	was	not	significant.	
The move to IFRs accounting has not 
changed how the Group is managed and 
does 	 not 	 have 	 an 	 impact 	 on 	 cashflow . 	
Trading results 
A summary of the results over the last 
three years shows the strong recovery from 
2007, the growth in sales, the continuing 
increase	in	the	gross	profit	percentage	and	
the	improving	profitability	(profit	before	tax)	
of the business: 
 2008	 2007	 2006 
 £’000 £’000 £’000
Revenue 14,717 11,437 12,301
Gross	profit	 4,739	 3,466	 3,852
Gross	profit	(%)	 32.2% 30.3% 31.3%
Profit 	 before 	 tax	 1,740	 683	 1,273
Sales revenue 
In 	 the 	 Chief 	 Executive’s 	 review , 	 Mark 	 Cambridge	
has	explained	the	key	developments	in	our	
markets, products and sales.
Gross profit 
The	profit	before	tax	of	£1.7m	has	increased	
by over £1.1m (155%) on the prior year. 
The gross margin percentage continued 
to increase this year, from 30% to 32%, 
building on the progress seen since 2002.
T o ensure that we continue to improve 
the gross margin percentage, we review 
regularly the sources and costs of raw 
material supplies, the design of our 
products and the processes that we are 
using in their manufacture as well as our 
number and use of staff. o ur average 
staff 	 numbers 	 passed 	 200 	 for 	 the 	 first 	
time this year, increasing to 205 from 192.
Administrative overheads 
We have continued to keep these costs 
under tight control during the year. The 
net increase was only £119,000 (£2.7m 
a g a i n s t 	 £ 2 . 6 m ) , 	 a n 	 i n c r e a s e 	 o f 	 l e s s 	 t h a n 	 5 % .	
As salary costs remain the largest single 
item in administrative overheads (over 50%), 
we review them annually in comparison 
to market rates and the developing roles 
of our employees. Despite the continuing 
growth in global sales, both travel and 
marketing costs remained at similar levels 
to the prior year.
R&D
The 	 Group 	 has 	 continued 	 to 	 invest 	 significant 	
amounts in developing its electronics and 
materials technologies during the year. 
The Directors have capitalised development 
expenditure	of	£173,000	(2007:	£152,000)	
and	expenditure	on	trademarks	of	£46,000	
(2007:	£50,000).	£224,000	was	expensed	
to	trading	profit	(2007:	£219,000)	in	respect	
of R&D costs. There is a commentary on 
R&D	in	the	Chief	Executive’s	review .
The Directors have continued to take 
advantage of the Government’s incentives 
for	R&D	through	the	HMRC’s	R&D	tax	credit	
scheme. Under this scheme, the Group can 
c l a i m 	 a n 	 a d d i t i o n a l 	 t a x 	 c r e d i t 	 o f 	 7 5 % 	 o n	
q u a l i f y i n g 	 R & D 	 e x p e n d i t u r e . 	 T h e 	 b e n e fi t	
of	this	to	the	tax	charge	is	shown	in	note	6.
Pre-tax profit 
The 	 pre-tax 	 profit 	 of 	 £1.7m 	 reflects 	 a 	 significant 	
improvement of over 150% over the prior 
y e a r ’ s 	 p r o fi t 	 o f 	 £ 6 8 3 , 0 0 0 . 	 T h e 	 r e a s o n s 	 f o r 	 t h i s	
excellent	performance	are	noted	elsewhere	
in 	 this 	 annual 	 report 	 and 	 financial 	 statements.
Financial review
The Centre for Life, a major educational and scientific research centre 
in Newcastle-upon-Tyne, uses the ZYBRID touch sensor in a number 
of its interactive displays.
Nexus Alpha, the transport company , uses the ZYBRID sensor as the interface 
in a railway track access system. 13
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Taxation 
In July 2008, the Finance Act 2008 enacted 
the abolition of IBAs and, as a consequence, 
in these accounts, we have incurred a 
o n e - o f f 	 d e f e r r e d 	 t a x 	 c h a r g e 	 o f 	 £ 1 7 4 , 0 0 0 .	
As	a	consequence,	the	G r o u p ’ s 	 t a x a t i o n	
c h a r g e 	 i n c r e a s e d 	 t h i s 	 year	to	£677,000	
(39%) from £149,000 (22%). The factors 
w h i c h 	 a f f e c t 	 t h e 	 G r o u p ’ s 	 taxation	charge	
are	outlined	further	in	note	6.
EPS and dividends 
Reported	basic	EPS	of	7.3p	(2007:	3.6p)	
reflects 	 the 	 significant 	 improvement 	 in 	
p r o fi t a b i l i t y . 	 T h e 	 n u m b e r 	 o f 	 s h a r e s 	 i n 	 i s s u e	
increased during the year by 11,944 to 
1 4 , 6 7 4 , 1 2 1 	 f o l l o w i n g 	 t h e 	 e x e r c i s e 	 o f	
two options as outlined in note 21a. 
After	adjusting	for	the	one-off	deferred	tax	
charge our “adjusted” Eps increased by 
140% to 8.4p (2007: 3.5p).
There were grants of new share options 
during	the	financial	year	for	384,392	shares,	
including 83,892 shares granted under the 
employee sharesave scheme. The total 
number of share options outstanding at 
30	September	2008	was	692,668.	
An incentive scheme was put in place 
for	the	Chief	Executive	during	the	year ,	
under which he can be awarded a total 
number of shares, up to 200,000, 
at 25p each, wholly dependent on the 
achievement	of	specified	EPS	ranges	
i n 	 t h e 	 fi v e 	 y e a r s 	 e n d i n g 	 3 0 	 S e p t e m b e r 	 2 0 0 9	
to 30 september 2013. 
The	dilutive	effect	of	existing	options	and	
this incentive scheme on the Eps is less 
than 5%. 
The Group paid an interim dividend of 
1.0p on 27 June 2008. With the improving 
profitability	seen	in	this	financial	year ,	the	
Group intends to continue its progressive 
dividend policy. A resolution to approve the 
payment 	 of 	 a 	 final 	 dividend 	 for 	 the 	 year 	 ended 	
30 september 2008 of 3.0p is included 
in the Notice of Annual General Meeting. 
This will bring the total dividend for the 
year to 4.0p (2007: 3.0p). 
Cashflow and working capital 
The Group has continued to generate 
n e t 	 c a s h fl o w 	 f r o m 	 o p e r a t i n g 	 a c t i v i t i e s ,	
a s 	 s h o w n 	 i n 	 t h e 	 c o n s o l i d a t e d 	 c a s h fl o w	
statement (page 30) and this has 
increased again with the growth in 
profitability .	It	amounted	to	just	under	
£2.0m this year in comparison to 
£1.3m in 2007.
As	expected,	our	working	capital	has	
increased, by £804,000 (2007: £184,000), with 
the growth in the Group’s business. stocks 
increased 	 by 	 £668,000 	 to 	 £2.5m. 	 This 	 reflects 	
increases in raw material stocks, to ensure that 
we 	 have 	 sufficient 	 quantities 	 on 	 hand 	 to 	 meet 	
the growth in sales and the ever‑shortening 
delivery	times	being	expected	by	our	
customers, and also the implementation 
of the Vendor Managed Inventory (“VMI”) 
systems operated by some larger customers, 
referred to in last year’s accounts. 
Trade and other receivables have increased 
by £272,000 (note 12a). Trade debtors have 
remained at a similar level to last year, despite 
the	growth	in	turnover ,	particularly	exports,	
and the lengthening of the credit periods 
given to many of our overseas customers. 
other receivables and prepayments, most 
notably VAT , have increased by £249,000. 
A summary of the results over the 
last three years shows the strong 
recovery from 2007, the growth in sales, 
the continuing increase in the gross 
profit percentage and the improving 
profitability (profit before tax) of 
the business.
ITV Bishop in Australia is using the ZYBRID sensor 
in a wayfinder/info kiosk application. 
Two examples of the use of ZYSWITCH touch sensitive 
switches. On the left is a small demonstration device 
where the switches control the sound, running etc of 
the video display , showing a butterfly . On the right is 
an example of a bank of switches for use on lifts. 14
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Capital expenditure on fixed assets
As noted in the Chairman’s statement, 
the	Group	has	completed	its	significant	
investment in the development of the 
new	manufacturing	facilities.	The	final	
plant and machinery was installed during 
the	first	half	of	the	year	and	the	production	
facilities became fully operational during 
January 2008. The total new investment 
this	year	in	tangible	fixed	assets	has	been	
£672,000	(2007:	£1.9m).
Capital 	 additions 	 to 	 intangible 	 fixed 	 assets 	
were	£246,000	(2007:	£287,000).	This	
consists of £27,000 spent on software relating 
t o 	 m a n u f a c t u r i n g 	 c o m p u t e r 	 s y s t e m s , 	 £ 4 6 , 0 0 0	
spent on licenses relating to trademarks and 
£ 1 7 3 , 0 0 0 	 s p e n t 	 o n 	 d e v e l o p m e n t 	 e x p e n d i t u r e ,	
as noted in R&D on page 12.
Funding and gearing
During	the	first	half	of	the	financial	year ,	
Zytronic Displays Limited took out four 
further Hp agreements to fund plant and 
equipment to complete the equipping of 
the new manufacturing facilities. The Group 
has continued with the repayments on its 
ten year property mortgage, its three year 
bank loan and the Hp agreements taken 
out in Fy2007. T otal repayments in the year 
amounted	to	£561,000	(2007:	£212,000).
T o ensure that the Group has adequate 
longer term funding to provide cover for 
future working capital requirements and 
capital	expenditure	needs,	the	Group	has	
in place further loan facilities. In particular, 
the Group has an unused £2.0m three year 
revolving credit facility with Lloyds TsB Bank, 
expiring	in	June	2010.	The	Group	has	an	
overdraft facility of £1.5m with Lloyds TsB 
Bank,	of	which	only	£601,000	was	in	use	
at the year end, and has been progressively 
building up its net cash balances. At the 
year end, cash balances were £1.3m.
At 30 september 2008, therefore, 
the 	 net 	 cash 	 balances 	 were 	 £651,000	
(2007: £140,000), medium term borrowings 
were £1.7m (2007: £1.8m) and the total net 
debt	was	£1.0m	(2007:	£1.6m).	The	gross	
gearing level (all borrowings and overdrafts 
divided by net assets) at 30 september 2008 
was 25% (2007: 24%), while the net gearing 
level (all borrowings less positive cash 
balances divided by net assets) was 
11% (2007: 20%).
D G W Mullan, B.Sc, FCA 
Finance Director 
19 December 2008
Financial review
continued
These two photographs are of ZYPROFILM rear screen projection touch sensors being used at the SID 
(Society of Information Display) show by a variety of different exhibitors.  15
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Board of Directors
John Martin Kennair MBE 
(D.O.B. 11/03/44)
(2)
Chairman
John joined the Romag Group in 1971 and 
was	appointed	Group	Chief	Executive	in	1975.	
He was responsible for the development of the 
glass business of the Romag Group into a wide 
range of new technologies, including bomb and 
bullet resistant glass, electronic shielding and 
touch sensors. In 1990 he was awarded an 
MBE for services to the specialised glass industry. 
He led the demerger of Zytronic Displays Limited 
from	the	Romag	Group	and	the	flotation	of	
its parent Company, Zytronic plc, in July 2000. 
He	also	led	the	subsequent	flotation	on	AIM	
in November 2003 of Romag Holdings plc, 
of which he is Chairman. John stepped down 
as	Chief	Executive	on	21	January	2008	on	the	
appointment of Mark Cambridge.
Mark Cambridge B.Sc
(D.O.B. 09/01/64)
Chief Executive
Mark graduated with a B.sc. (Hons) 
in 	 Materials 	 Science 	 in 	 1986 	 and 	 has	
a 	 S e c u r i t i e s 	 I n s t i t u t e 	 C e r t i fi c a t e 	 i n	
Corporate Finance (2003). Joining the 
Romag Group of companies in 1991, 
he held the positions of T echnical Manager, 
Quality Manager and Technical and 
Quality Director, up to the demerger and 
flotation	of	Zytronic.	Since	2000	he	has	
overseen the development, market 
introduction and sales of the ZyToUCH 
touch sensor product and the market 
launch of Zypos touch sensors. Mark 
was sales and Marketing Director of 
Zytronic Displays Limited from 2002 until 
his appointment as its Managing Director 
in	F ebruary	2006.	On	1	June	2007	Mark	
was appointed to the Board and promoted 
to	Chief	Executive	on	21	January	2008.
Denis Gerald Wilson Mullan B.Sc, FCA 
(D.O.B. 08/02/54)
Finance Director
Denis was formerly a partner in 
Ernst & young LLp , specialising in 
corporate	finance.	He	was	based	
successively	in	its	offices	in	London,	
Newcastle-upon- T yne	and	finally	
Bristol. While based in Ernst & young’s 
N e w c a s t l e - u p o n - T y n e 	 o f fi c e , 	 h e 	 l e d 	 i t s 	 w o r k	
on the demerger of Zytronic Displays Limited 
in June 2000 and the subsequent admission 
to AIM of Zytronic plc in July 2000. shortly 
thereafter he transferred to Ernst & young’s 
Bristol	office,	at	which	time	his	formal	
advisory role to the Group ceased. 
He joined the Group in August 2003.
Directors
Ian Crosby B.Sc
(D.O.B. 19/02/67)
Sales & Marketing Director
Ian	has	more	than	15	years’	experience	
in international sales, having started his career 
in 1988 at Fortune 500 company and global 
speciality glass and ceramic products manufacturer, 
Corning Inc. Ian remained at Corning until 2003 
and held various international sales and product 
management positions including several years on 
overseas assignments to Milan, Italy and Corning, 
New york, UsA. Immediately prior to joining Zytronic, 
Ian was employed as Global Account Director at 
Filtrona Filters, an international manufacturer of 
speciality 	 filters 	 to 	 the 	 tobacco 	 industry 	 and 	 operating 	
unit of Filtrona plc. Ian holds a B.sc (Hons) in 
Combined science (Ceramic T echnology).
Key senior management of Zytronic Displays Limited
Tudor Griffith Davies B.Sc 
(D.O.B. 02/12/51)
(1) (2)
Senior Independent Non-executive Director
T udor	has	wide	industry	experience	at	
b o a r d r o o m 	 l e v e l , 	 a s 	 C h a i r m a n , 	 C h i e f 	 E x e c u t i v e	
and	Executive	and	Non-executive	Director	
of several public companies. These have 
included Hicking pentecost plc, stratagem plc 
and Dowding & Mills plc. He was formerly 
a partner in Arthur young (a predecessor 
firm	of	Ernst	&	Y oung	LLP)	specialising	in	
corporate 	 finance 	 and 	 recovery . 	 T udor 	 is 	 currently 	
E x e c u t i v e 	 D i r e c t o r 	 o f 	 C a s t l e 	 S u p p o r t 	 S e r v i c e s 	 p l c .	
T udor is Chairman of the audit committee.
Sir David Robert Macgowan Chapman Bt., 
DL, B Comm
(D.O.B. 16/12/41)
(1) (2)
Independent Non-executive Director
sir David is a former Director of Northern Rock plc 
a n d 	 t h e 	 L o n d o n 	 S t o c k 	 E x c h a n g e 	 a n d 	 a 	 m e m b e r	
of the Greenbury Committee on Directors’ 
Remuneration. He is a Director of a number of 
regional venture capital funds. A former Chairman 
of CBI – North East and a First Vice president 
of Merrill Lynch International Bank, sir David 
is currently a consultant with UBs Wealth 
Management (UK) Limited. sir David is 
Chairman of the remuneration committee.
David Eric Banks MA (Cantab), FCA 
(D.O.B. 13/08/53)
(2)
Non-executive Director and Deputy Chairman
David held a variety of positions in 
industry at Director level before forming 
David Banks Associates, which provides 
temporary and part time assistance in 
financial 	 supervision 	 and 	 management. 	
He was appointed Finance Director of 
Zytronic	plc	in	June	2000,	prior	to	its	flotation,	
and	became	a	Non-executive	Director	with	
effect from 1 september 2003 following the 
appointment of Denis Mullan to that role. 
David is Finance Director of Romag Holdings plc 
and	a	Non-executive	Director	of	Castle	Support	
services plc. He is Chairman of the Group’s 
trading subsidiary, Zytronic Displays Limited. 
(1)
 member of audit committee. 
(2)
 member of remuneration committee.
All of the Directors served throughout the 
financial	year . 16
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Corporate information
Website 
www.zytronic.co.uk
Secretary 
Denis G W Mullan, B.sc, FCA 
Email: denis.mullan@zytronic.co.uk
Registered office 
Whiteley Road 
Blaydon‑on‑ Tyne 
Tyne & Wear 
NE21 5NJ 
T elephone: 0191 414 5511 
F ax:	0191	414	0545
Registration number 
3881244
Stockbrokers and nominated adviser 
Brewin Dolphin Limited 
48 st. Vincent street 
Glasgow 
G2 5Ts
Registrars 
Computershare Investor services pLC 
PO	Box	82 
The pavillions 
Bridgwater Road 
Bristol 
Bs99 7NH
Bankers 
Lloyds TsB Bank plc 
PO	Box	686 
First Floor 
Black Horse House 
91 sandyford Road 
Newcastle‑upon‑ Tyne 
NE99 1JW
yorkshire Bank 
Quayside House 
110 Quayside  
Newcastle‑upon‑ Tyne 
NE1 3DX
Auditors 
Ernst & young LLp 
Citygate 
st James’ Boulevard 
Newcastle‑upon‑ Tyne 
NE1 4JD 
Solicitors 
Ward Hadaway 
sandgate House 
102 Quayside 
Newcastle‑upon‑ Tyne 
NE1 3DX
Muckle LLp 
Time Central 
32 Gallowgate 
Newcastle‑upon‑ Tyne 
NE1 4BF  17
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Directors’ report
The Directors present their report and financial statements for the year ended 30 September 2008.
Business review
Details of developments and the progress of the Group are contained within this Business review as well as in the Chairman’s statement, 
Chief Executive’s review and Financial review.
Principal activities
Zytronic is the developer and manufacturer of a unique range of internationally award-winning touch sensor products. These products 
employ an embedded sensing element and are based on projected capacitive technology (“PCT™”). PCT offers significant durability, 
environmental stability and optical enhancement benefits to system designers of integrated electronic displays, beyond that which 
was previously attainable.
Zytronic is also an industry leader in the development and manufacture of customised optical filters to enhance electronic display 
performance and an innovator in the production of specialised and transparent laminates for niche markets.
Competitive advantages
The Group’s competitive advantages are based upon both the patented technology relating to the operation of the touch sensors 
and the lamination techniques and processes, built up over 40 years of operations, which are a feature of all the Group’s products. 
These advantages allow the Group to produce products which have optical clarity and ruggedness, and can be customised to include 
individual features for customers, including privacy filters and anti-reflective and anti-glare properties. In the case of touch sensors, 
these advantages also result in the significant ability for them to be used by bare fingers and gloved hands and result in them not 
experiencing positional drift and therefore not requiring periodic re-calibration.
The growth of the Group and its future prospects come from the exploitation of this relatively new touch sensor technology. Differing 
adaptations of this patented technology have resulted in four different product groups being developed: ZYTOUCH touch sensors 
and keypads; ZYPOS, and its derivative ZYBRID, touch sensors; ZYSWITCH touch-switch sensors; and ZYFILM and ZYPROFILM 
plastic-based touch sensors. ZYTOUCH, ZYPOS and ZYBRID touch sensors are designed to work in front of LCDs or other electronic 
devices where optical clarity is paramount. Conversely, the technology has been adapted to produce ZYTOUCH keypads and 
ZYSWITCH touch-switch sensors which are not required to be transparent.
The Group’s Intellectual Property Rights include confidential operations and processes, technology covered by patents and licensed 
technology, trademarks and copyrights. Over recent years the Group has taken significant steps to register its trademarks. 
The Group will continue to identify further opportunities for the development of new product groups and expends a considerable 
amount on R&D. By continually developing and adapting its technologies the Group has been able to expand the applications of 
the touch sensors into a widening range of applications and new sectors of business and to promote the Group’s products on a 
global basis. At present nearly 80% of all products are directly exported from the UK, with a large proportion of UK sales eventually 
being exported as well.
The Group has continued the expansion of its worldwide selling operations, expanding its direct salesforce, based at the Group’s head office 
at Blaydon-on-Tyne. It has recently appointed a distributor in the Netherlands, one in Turkey, and a second in Japan. Management is 
continuing to look for suitable appointees to expand the Group’s presence worldwide.
Business risks
The main risk to the Group’s business is that of advances in competing technology, whereby a new, better touch sensor technology is 
created. Management is conscious of this and monitors competitors’ developments and changes within the whole industry. By continually 
developing and evolving its own technologies, the Group expects to build upon its competitive strengths and thereby keep its technology 
ahead of its competitors.
Another competitive risk arises from downward price pressures from competing technologies. This is most prevalent in the lower valued 
touch sensor sector dominated by resistive, capacitive and surface acoustic wave touchscreens, as new Asian manufacturers continue 
to take advantage of the demise of the patents on those technologies. However, price pressure in those markets does have a knock-on 
effect on prices throughout the industry. 
Management has successfully met these challenges to date by re-designing and re-engineering the ZYTOUCH touch sensor in 
developing the ZYPOS touch sensor. This has enabled the Group to reduce the cost of manufacture and therefore the sales price 
for ZYPOS touch sensors and is allowing the Group to get into markets that were previously closed to it on price grounds. 
Management is also continually reviewing the sources and costs of raw material supplies, the design of the Group’s products and the 
operational processes that are used in the manufacture of all of the Group’s products.
A further risk, which is directly within the control of management, is that of managing increases in the overhead base to coincide with 
the growth in turnover, thereby maintaining the growth in profitability. This is not straightforward when the business is developing new 
products and manufacturing processes. 18
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Business review (continued)
Business risks (continued)
A fourth risk is that, as a growing proportion of the Group’s sales are denominated in US$ and Euros, the Group is subject to risks 
associated with currency movements. It is the Group’s policy to manage these risks and provide a degree of certainty for cashflows 
into the UK. Note 20 sets out details of the Group’s financial risk management policy and financial instruments, including its management 
of its foreign exchange risk. 
Natural hedging is adopted where possible to manage currency risk, whereby goods and services are sourced from Europe and the USA 
and the liability arises in the respective currencies. This is especially relevant with specialised glass, some electronic components and 
certain other raw materials. 
Throughout the year under review the Board continued to consider the use of forward foreign exchange contracts, having last 
used them in 2003/2004. Since the year end, in October 2008, management has taken out two US$ forward exchange contracts. 
Some currency is un-hedged, being dealt with at the spot rate when required. The Group’s exposure to foreign exchange movements 
may also be reduced in the future by undertaking some borrowing in overseas currencies, especially where plant and machinery is 
sourced from abroad.
The Group does not hold speculative positions against movements in foreign currencies or interest rates.
Key performance indicators (“KPIs”)
The KPIs for the business, at this stage of its development, are primarily financial. 
The current KPIs consist of setting targets for and monitoring the level and growth of sales; improving the gross profit margin; and 
controlling the level of overheads. The Directors set targets for operating management in terms of sales growth and margin improvement. 
The actual performance of the Group against each of these KPIs is set out in the Chairman’s statement, Chief Executive’s review and 
Financial review. 
In addition, the Directors review an “activity monitor” which the sales team uses to record significant sales opportunities, the key dates 
in the development of each sales prospect with the customer, volumes and values of the opportunities and expected production 
commencement dates. 
The Directors have not developed KPIs relating to environmental matters; the Group’s employees; or social and community issues. 
The Directors maintain a close watch on the level and competitiveness of wages paid to factory staff and the market level of staff salaries, 
to ensure that the Group is not at a disadvantage when seeking to recruit staff or to retain them. The Group also uses share option schemes 
to incentivise employees. The Remuneration report summarises the policies relating to executive management.
Results and dividends
The consolidated income statement is set out on page 28. The Group profit after taxation amounted to £1.06m (2007: £534,000). 
The Directors propose the payment of a final dividend of 3.0p per share (2007: 2.0p). Following the dividend of 1.0p per share paid 
in June 2007, this will bring the total dividend for the year to 4.0p per share (2007: 3.0p).
Directors
The Directors of the Company are shown on page 15. Mark Cambridge, who was appointed to the Board of Zytronic plc with effect 
from 1 June 2007, was promoted to the role of Chief Executive on 21 January 2008. All of the Directors were Directors for the whole 
of the year. The emoluments and interests of the Directors in the shares of the Company are set out in the Remuneration report.
Statement of Directors’ responsibilities in relation to the Group financial statements
The Directors are responsible for preparing the annual report and the Group financial statements in accordance with applicable 
United Kingdom law and those International Financial Reporting Standards (“IFRS”) as adopted by the European Union.
The Directors are required to prepare Group financial statements for each financial year which present fairly the financial position of 
the Group and the financial performance and cashflows of the Group for that period. In preparing those Group financial statements 
the Directors are required to:
I  select suitable accounting policies in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors 
and then apply them consistently;
I  present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;
I  provide additional disclosures when compliance with specific requirements in IFRS is insufficient to enable users to understand 
the impact of particular transactions, other events and conditions on the Group’s financial position and financial performance; and
I state that the Group has complied with IFRS, subject to any material departures disclosed and explained in the financial statements.
The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the financial 
position of the Group and enable them to ensure that the Group financial statements comply with the Companies Act 1985. They are 
also responsible for safeguarding the assets of the Group and hence for taking reasonable steps for the prevention and detection of 
fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s 
website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from 
legislation in other jurisdictions.
Directors’ report
continued 19
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Disclosure of information to auditors
So far as each Director is aware, there is no relevant audit information of which the Company’s auditors are unaware. Each Director 
has taken all the steps that he ought to have taken as a Director in order to make himself aware of any relevant audit information 
and to establish that the Company’s auditors are aware of that information.
Significant interests in shares
On 12 December 2008, the following had interests in the ordinary shares of the Company:
     Number of  Percentage 
Shareholders      shares holding
SIS SEGA Intersettle AG/Omnibus     3,294,222 22.4%
Axa S.A. (Framlington Investment Management Limited)     2,704,741 18.4%
Saracen Investment Funds – Growth Fund     1,323,289 9.0%
John M Kennair MBE – Chairman (beneficial and non-beneficial)     1,162,708 7.9%
Schroder Investment Management     1,000,000 6.8%
Singer & Friedlander     645,997 4.4%
Montanaro Group Funds     618,582 4.2%
Creditor payment policy and practice
It is the Group’s policy that payments to suppliers are made in accordance with those terms and conditions agreed between the Group 
and its suppliers, provided that all trading terms and conditions have been complied with. At 30 September 2008, the Company had an 
average of 30 days (2007: 30 days) purchases outstanding in trade creditors. 
Political and charitable contributions
The Group did not make any political or charitable contributions during the year (2007: £Nil). 
Special business
A resolution will be proposed at the forthcoming Annual General Meeting to renew the existing authority of the Directors, last conferred 
by a resolution passed at the Annual General Meeting held in 2008, to allot unissued ordinary shares of the Company. The authority 
(special resolution 1 in the Notice of Annual General Meeting) will extend until the Annual General Meeting held in 2010 and is in 
respect of one-third of the Company’s issued share capital.
The Directors consider it advisable that they continue to have power to make allotments of ordinary shares of the Company for cash 
without reference to the statutory pre-emption rights, up to a maximum of 1,467,412 ordinary shares, being 10% of the issued ordinary 
share capital of the Company at 30 September 2008. The authority (special resolution 2 in the Notice of Annual General Meeting) will 
extend until the Annual General Meeting held in 2010 and also would enable the Directors to implement a rights issue.
In addition, the Directors consider it advisable that the Company has the authority to make market purchases of its own shares up to a 
maximum of 1,467,412 ordinary shares of the Company, being 10% of the issued ordinary share capital. The authority (special resolution 3 
in the Notice of Annual General Meeting) will extend until the Annual General Meeting held in 2010. The power conferred by this authority 
would only be used after careful consideration by the Directors, having taken into account market conditions prevailing at the time, 
the investment needs of the Company, its opportunities for expansion and its overall financial position. The authority would only 
be exercised by the Directors if they considered it to be in the best interests of shareholders generally and if the purchase(s) could 
be expected to result in an increase in earnings per share. 
Auditors
A resolution to re-appoint Ernst & Young LLP as the Company’s auditors will be put to the shareholders at the forthcoming 
Annual General Meeting.
By order of the Board
D G W Mullan, B.Sc, FCA
Company Secretary
19 December 2008 20
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
As an AIM listed company, Zytronic is not obliged to comply with the revised Combined Code published in June 2006 (the “Combined Code”) 
but instead uses its provisions as a guide, but only as considered appropriate to the circumstances of the Company.
The Company is committed to high standards of corporate governance. The Directors consider that, except for the matters noted below, 
the Company has, throughout the year, been in full compliance with the provisions set out in Section 1 of the Combined Code. During 
the year under review, the Company introduced changes to comply with the requirements of A2.1 (segregation of the roles of Chairman 
and Chief Executive), B2.1 (the remuneration committee should be chaired by a Non-executive Director), and C3.4 (the Company 
should have a formal whistle-blowing procedure).
I A4.1  –  For reasons explained below, the Company does not have a separate nominations committee.
I A6  –   The Board has not undertaken a formal evaluation of its own performance and that of its committees and 
individual members.
I A7.2  –   The Non-executive Directors have not been appointed for a specific term, but their contracts are terminable 
with six months’ notice.
In view of the size and structure of the Group, the Board does not believe that these exceptions had any detrimental effect on the 
control environment and corporate governance.
The workings of the Board and its committees
The Board
Throughout the year, John M Kennair MBE, the Chairman, Mark Cambridge, the Chief Executive, Denis Mullan, the Finance Director, 
T udor Davies and Sir David Chapman, Bt., the two Independent Non-executive Directors and David Banks, a Non-executive Director 
and Deputy Chairman were members of the Board. David Banks is not considered to be independent because he was the 
Finance Director of the Group until August 2003. 
John M Kennair MBE stepped down from his position as Chief Executive on 21 January 2008, following the appointment to that role 
of Mark Cambridge on that date. John M Kennair MBE is also the Chairman of Romag Holdings plc, another AIM company. As this is 
his only other business commitment, the Board considers that he is able to devote sufficient time to his responsibilities within the Group.
The Non-executive Directors demonstrate a range of experience and sufficient calibre to bring independent judgement on issues 
of strategy, performance, resources and standards of conduct which are vital to the success of the Group.
The Board normally meets at least five times per year. Its direct responsibilities include setting annual budgets, reviewing trading 
performance, approving significant capital expenditure, ensuring adequate funding, setting and monitoring strategy, examining major 
acquisition possibilities and reporting to shareholders. Between meetings there is regular informal discussion between the Chairman, 
Chief Executive, Finance Director and individual Non-executive Directors. The Non-executive Directors have a particular responsibility 
to ensure that the strategies proposed by the Executive Directors are fully considered. 
T o enable the Board to discharge its duties, all Directors receive appropriate and timely information. Briefing papers are distributed 
by the Company Secretary to all Directors in advance of Board meetings. The Chairman ensures that the Directors are able to take 
independent professional advice as required, at the Company’s expense.
The standing committees established by the Board are the remuneration committee and audit committee, each of which operates 
within defined terms of reference.
A nominations committee has not been established as the Board is small. The nominations process prior to Board appointments 
takes into account the views of all existing Board members and some advisers. Any Director appointed to the Board since the last 
Annual General Meeting is required to seek re-election at the subsequent Annual General Meeting. All Directors are subject to 
re-election at least once every three years. 
The number of meetings of the Board, and the attendance of Directors, was as follows:
     Number of   
Directors      meetings Attendance
John M Kennair MBE     5 5
Mark Cambridge     5 5
Denis Mullan     5 5
Tudor Davies     5 3
Sir David Chapman, Bt.     5 5
David Banks     5 5
Corporate governance 21
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
The workings of the Board and its committees (continued)
Remuneration committee
The remuneration committee is chaired by Sir David Chapman, Bt., an Independent Non-executive Director. Of the other three members, 
Tudor Davies is the Senior Independent Non-executive Director, David Banks is a Non-independent Non-executive Director and 
John M Kennair MBE is the Non-executive Chairman. The committee is responsible for making recommendations to the Board, within 
agreed terms of reference, on the Company’s framework of executive remuneration and its cost, including the remuneration of subsidiary 
Directors. The committee determines the contract terms, remuneration and other benefits for each of the Executive Directors, including 
performance related bonus schemes, pension rights and compensation payments. Further details of the Company’s policies on 
remuneration, service contracts and compensation payments are given in the Remuneration report. The Chairman’s remuneration 
is determined by a sub-committee comprising only the two Independent Non-executive Directors. 
The number of meetings of the committee, and the attendance of members, was as follows:
     Number of  
Committee members      meetings Attendance
Sir David Chapman, Bt.      1 1
Tudor Davies     1 1
John M Kennair MBE     1 1
David Banks     1 1
Audit committee
The audit committee is chaired by T udor Davies. He and the other member, Sir David Chapman, Bt., are both Independent 
Non-executive Directors. Meetings are also attended, by invitation, by the other Directors. The committee meets at least twice 
a year. The committee provides a forum for reporting by the Group’s external auditors.
The audit committee is responsible for reviewing a wide range of matters including the half year and annual financial statements 
before their submission to the Board and monitoring the controls which are in force to ensure the integrity of the information reported 
to the shareholders. The audit committee advises the Board on the appointment of external auditors and on their remuneration both 
for audit and non-audit work, and discusses the nature, scope and results of the audit with the auditors.
The audit committee keeps under review the cost effectiveness of the auditors. It also reviews the extent of the non-audit services 
provided by the auditors and reviews with them their independence and objectivity. The Chairman of the audit committee reports 
the outcome of audit committee meetings to the Board and the Board receives minutes of the meetings.
The number of meetings of the committee, and the attendance of members, was as follows:
     Number of   
Committee members     meetings Attendance
Tudor Davies     4 3
Sir David Chapman, Bt.     4 4
Relations with shareholders
Communication with shareholders is given high priority. There is regular dialogue with major and/or institutional shareholders including 
presentations after the Company’s announcements of the half year and full year results in May and December respectively. Presentations 
are also made to analysts and journalists at those times to present the Group’s results and report on developments. This assists with 
the promotion of knowledge of the Group in the investment marketplace and with shareholders. The financial statements include a 
review of the business and future developments. These financial statements and other information relating to the Group are also 
available on the Group’s website www.zytronic.co.uk.
Following the half year and year-end presentations of results, the Executive Directors report to the Board on the feedback received 
from journalists, analysts and shareholders. In addition, the Company’s financial PR advisers also produce a feedback report from 
those meetings which is made available to all Directors. The Executive Directors also report to the Board on any meetings with 
shareholders or institutional investors that may take place at other times of the year.
The Board uses both the annual report and financial statements and the Annual General Meeting to communicate directly with 
private and institutional investors and welcomes their participation. The Chairman aims to ensure that the chairmen of the audit and 
remuneration committees are available at the Annual General Meeting to answer questions. Details of resolutions to be proposed 
at the Annual General Meeting on 19 February 2009 can be found in the Notice of Annual General Meeting on pages 67 and 68.
In addition, the Senior Independent Director is available to shareholders if they have any concerns which contact through the normal 
channels of the Chairman, Chief Executive or the Finance Director has failed to resolve or for which such contact is inappropriate. 22
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Internal control
The Board is responsible for establishing and maintaining the Group’s system of internal control and for reviewing its effectiveness. 
The system is designed to manage rather than eliminate the risk of failure to achieve the Group’s strategic objectives and can only 
provide reasonable and not absolute assurance against material misstatement or loss. As an AIM listed company, the Company 
does not need to comply with Code provision C2.1 regarding the Directors giving a summary of the process applied by the Board 
in reviewing the effectiveness of the system of internal control. Instead, the Directors set out below some of the key aspects of the 
Group’s internal control procedures.
An ongoing process, in accordance with the guidance of the T urnbull Committee on internal control, has been established for 
identifying, evaluating and managing the significant risks faced by the Group. The process has been in place for the full year under 
review and up to the date of approval of the annual report and financial statements. The Board regularly reviews this process as part 
of its review of such risks within Board meetings. Where any weaknesses are identified, an action plan is prepared to address the 
issues and is then implemented.
The Board has overall responsibility for the Group and there is a formal schedule of matters specifically reserved for decision by the 
Board. Authority to operate the trading subsidiary, Zytronic Displays Limited, is delegated to its Board of Directors and through them 
it is run by its management within limits set by the Board. The appointment of Executives to the most senior positions within the 
Group requires the approval of the Board.
Each year the Board approves the annual budget. Key risk areas are identified, reviewed and monitored. Performance is monitored 
against budget, relevant action is taken throughout the year and updated forecasts are prepared as appropriate. The reports reviewed 
by the Board include reports on operational as well as financial issues.
Capital and development expenditure is regulated by a budgetary process and authorisation levels. For expenditure beyond specified 
levels, detailed written proposals have to be submitted to the Board for approval. Reviews are carried out after the purchase is complete. 
The Board requires management to explain any major deviations from authorised capital proposals and to seek further sanction from 
the Board.
Due diligence work is carried out if a business is to be acquired.
The Board has reviewed the need for an internal audit function and concluded that this is not currently necessary in view of the small 
size of the Group and the close supervision by senior management of its day-to-day operations. The Board will continue to keep this 
under review.
During the year, the Board introduced a whistle-blowing policy and put in place procedures to encourage staff to contact the 
Deputy Chairman if they needed to raise matters of concerns other than via the Executive Directors and senior management.
Going concern
After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational 
existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the financial statements.
Corporate governance
continued 23
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
As an AIM listed company, Zytronic makes the following disclosures voluntarily and they are not intended to, and indeed do not, comply 
with the requirements of Schedule 7A of the Companies Act 1985.
The remuneration committee is responsible for determining the remuneration and other terms of employment for the Executive Directors of 
Zytronic plc and its trading subsidiary, Zytronic Displays Limited. The committee is composed of the two Independent Non-executive Directors, 
the Non-independent Non-executive Director and the Chairman. In determining remuneration for the year, the committee has given full 
consideration to the requirements of the Combined Code.
Remuneration policy
The remuneration of Executive Directors is determined by the committee, and the remuneration of Non-executive Directors is approved 
by the full Board of Directors. The remuneration of the Chairman is determined by the two Independent Non-executive Directors.
The key objectives of the committee in determining the remuneration packages of Executive Directors are:
I the recruitment, retention and incentivisation of executive management of the right calibre; and
I the alignment of executive management and shareholder interests.
The remuneration packages of Executive Directors comprise the following elements:
Basic salary and benefits
Basic salaries for Executive Directors are reviewed annually having regard to individual performance and market practice. In most 
cases benefits provided to Executive Directors comprise the provision of a company car, or appropriate allowance, health insurance 
and contributions to a Group personal pension scheme. Details of emoluments for the Directors of Zytronic plc are set out on page 24.
Annual bonus
A discretionary bonus may be awarded by the remuneration committee to reward exceptional individual performance.
Share options and incentive schemes
The Company believes that share ownership by Executive Directors and employees strengthens the link between their personal interests 
and those of the Company and the shareholders.
The Company has executive share option and incentive schemes, which are designed to promote long term improvement in the 
performance of the Group, sustained increase in shareholder value and clear linkage between executive reward and the Group’s 
performance. The share options and incentive schemes of the Directors of Zytronic plc are set out on page 25.
It will normally be the case that, on the option holder ceasing employment with the Group, the options will be terminated. In some 
circumstances, the Board may have discretion to waive this where the past contribution to the business by the option holder justifies it.
The Company also has a Sharesave option scheme. Membership is open to all eligible employees, including Directors, who have more 
than three months’ employment with the Group at the time options are offered under a scheme. In compliance with the Combined Code 
the Board has agreed that it will not grant share options to Non-executive Directors.
Service contracts
John M Kennair MBE, Denis Mullan and Mark Cambridge all have a service contract with a notice entitlement of six months.
The committee considers the Directors’ notice entitlements to be appropriate as they are in line with the market and take account 
of the Directors’ knowledge and experience. There are no special provisions for predetermined compensation in the event of loss 
of office.
Non-executive Directors
The fees of the Non-executive Directors are determined by the full Board within the limits set out in the Memorandum and Articles of Association. 
The Non-executive Directors are not eligible for bonuses, pension benefits or share options.
Remuneration report 24
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Directors’ emoluments
Emoluments of the Directors for the year to 30 September 2008 are:
     Total T otal 
     emoluments* emoluments* 
 Salary  Fees Benefits Bonus 2008 2007 
 £’000  £’000  £’000 £’000 £’000  £’000
Chairman      
John M Kennair MBE 85 — — — 85 85
Executive      
Denis Mullan 83 — 9 6 98 90
Mark Cambridge** 86 — 11 10 107 30
Non-executive      
Tudor Davies — 23 — — 23 21
Sir David Chapman, Bt — 23 — — 23 21
David Banks*** — 33 — — 33 27
 254 79 20 16 369 274
* excluding pension contributions. 
**  for Mark Cambridge, the figures are the salary and benefits paid to him as an employee of the trading subsidiary, Zytronic Displays Limited (2007: from 1 June 2007).
*** fees are paid to David Banks Associates, a partnership in which David Banks is a partner.
Pension contributions
During the year, the Group made annual pension contributions for Mark Cambridge and for Denis Mullan, Executive Directors, 
to a personal pension scheme (i.e. a defined contribution scheme). Neither benefits in kind nor bonuses are pensionable.
Details of contributions payable by the Company are:
     2008 2007 
Director     £’000 £’000
Mark Cambridge     3 1
Denis Mullan     2 2
T otal     5 3
Directors’ shareholdings
Beneficial interests of the Directors in the shares of the Company, including those of their immediate families, were:
     30 September
     2008 2007 
     Number Number
John M Kennair MBE – beneficial     1,033,065 1,339,928
  – as trustee     129,643 —
Mark Cambridge      36,113 36,113
Denis Mullan     130,000 130,000
Tudor Davies     90,909 90,909
Sir David Chapman, Bt.     40,000 40,000
David Banks     14,545 14,545
There has been no change in Directors’ shareholdings since 30 September 2008.
Remuneration report
continued 25
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Directors’ share options
   Granted Exercised    
 30 September during during 30 September   
Enterprise Management 2007 year year 2008   Option 
Incentive Scheme Number Number Number Number  Exercise dates  price
Denis Mullan 100,000 — — 100,000 16 March 2006 to  70.0p 
     15 March 2014 
Denis Mullan 17,182 — — 17,182 18 January 2008 to 145.5p 
     17 January 2015 
Denis Mullan — 2,300 — 2,300 28 February 2011 to 216.5p 
     27 February 2018 
Mark Cambridge 17,182 — — 17,182 18 January 2008 to 145.5p 
     17 January 2015 
Mark Cambridge 27,250 — — 27,250 11 January 2009 to 274.5p
     10 January 2016  
   Granted Exercised    
 30 September during during 30 September   
 2007 year year 2008  Option 
Unapproved Scheme Number Number Number Number Exercise dates  price
Denis Mullan — 12,700 — 12,700 28 February 2011 to 216.5p
      27 February 2018 
Director’s share incentive scheme 
Share incentive scheme for Mark Cambridge, Chief Executive 
The remuneration committee agreed an incentive award scheme for Mark Cambridge, Chief Executive, to offer him up to 200,000 shares 
at a price of 25p per share to vest based on specified performance criteria.
These are measured by an EPS, calculated on the audited pre-tax profit and a standard 28% tax charge. The EPS criteria are shown below:
 Performance criteria
 Lower limit  Upper limit
   EPS Shares EPS Shares 
   pence to vest pence to vest
Year to 30 September 2009 (year 1)   13.5 80,000 15.0 100,000
Year to 30 September 2010 (year 2)   18.3 60,000 22.0 80,000
Year to 30 September 2011 (year 3)   24.5 60,000 24.5 20,000 26
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Director’s share incentive scheme (continued)
Share incentive scheme for Mark Cambridge, Chief Executive (continued)
Vesting is:
I the entitlement to buy, which doesn’t disappear once earned;
I pro rata between the upper and lower limits;
I timed on signature of audited accounts with a clean audit report; and
I  cumulative, e.g. 200,000 shares can vest in year 3 if the upper limit is reached, even if the lower limits have not been achieved 
in the previous years.
If the 24.5p EPS criteria is not achieved in year 3, there will still be an opportunity for shares to vest in year 4 (to 30 September 2012) 
or year 5 (to 30 September 2013) on the achievement of 24.5p EPS on the basis that, on achievement, the maximum total entitlement 
reduces to 125,000 shares or 50,000 shares respectively, or the number of shares already vested if that is greater.
Vesting will also take place in the event of a successful takeover and will be based on the takeover price, with full vesting at a share price 
of 500p and pro rata vesting down to a price of 300p as follows:
I 1,000 shares for each 1p above 300p up to 500p until 30 September 2011, reduced for any shares which have already vested;
I  625 shares for each 1p above 300p up to 500p between 1 October 2011 and 30 September 2012, reduced for any shares which 
have already vested; and
I  250 shares for each 1p above 300p up to 500p between 1 October 2012 and 30 September 2013, reduced for any shares which 
have already vested.
During the year to 30 September 2008, the highest share price was 245.0p and the lowest share price was 157.5p. The market price 
of the shares at 30 September 2008 was 157.5p.
Directors’ interests in material contracts
As noted above, the Company has paid Directors’ fees to David Banks Associates, a partnership in which David Banks is a partner. 
At 30 September 2008 the amount due to David Banks Associates was £3,231 (2007: £3,231).
With this exception, no Director was materially interested either at the year end or during the year in any contract of significance to the 
Group other than their employment or service contract. 
Remuneration report
continued 27
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
We have audited the Group financial statements of Zytronic plc for the year ended 30 September 2008 which comprise the 
Consolidated Income Statement, the Consolidated Balance Sheet, the Consolidated Cashflow Statement, the Consolidated Statement 
of Recognised Income and Expense and the related notes 1 to 28. These Group financial statements have been prepared under the 
accounting policies set out therein.
We have reported separately on the Parent Company financial statements of Zytronic plc for the year ended 30 September 2008.
This report is made solely to the Company’s members, as a body, in accordance with Section 235 of the Companies Act 1985. 
Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to 
them in an auditors’ report and for no other purpose. T o the fullest extent permitted by law, we do not accept or assume responsibility 
to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions we 
have formed.
Respective responsibilities of Directors and auditors
The Directors’ responsibilities for preparing the annual report and the Group financial statements in accordance with applicable 
United Kingdom law and International Financial Reporting Standards (“IFRS”) as adopted by the European Union are set out in 
the Statement of Directors’ Responsibilities.
Our responsibility is to audit the Group financial statements in accordance with relevant legal and regulatory requirements and 
International Standards on Auditing (UK and Ireland).
We report to you our opinion as to whether the Group financial statements give a true and fair view and whether the Group financial 
statements have been properly prepared in accordance with the Companies Act 1985. We also report to you whether in our opinion 
the information given in the Directors’ report is consistent with the financial statements. The information given in the Directors’ report 
includes that specific information presented in the Chairman’s statement, Chief Executive’s review and Financial review that is 
cross referred from the Business review section of the Directors’ report. 
In addition we report to you if, in our opinion, we have not received all the information and explanations we require for our audit, 
or if information specified by law regarding Directors’ remuneration and other transactions is not disclosed.
We read other information contained in the annual report and consider whether it is consistent with the audited Group financial statements. 
The other information comprises only the Corporate statement; Highlights; the Chairman’s statement; Our markets, at a glance; 
What we do, at a glance; the Chief Executive’s review; the Financial review; Directors; Corporate information; the Directors’ report; 
Corporate governance; Remuneration report; Five year summaries; and Notice of Annual General Meeting. We consider the implications 
for our report if we become aware of any apparent misstatements or material inconsistencies with the Group financial statements. 
Our responsibilities do not extend to any other information.
Basis of audit opinion
We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing Practices Board. 
An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the Group financial statements. 
It also includes an assessment of the significant estimates and judgements made by the Directors in the preparation of the Group 
financial statements, and of whether the accounting policies are appropriate to the Group’s circumstances, consistently applied and 
adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to 
provide us with sufficient evidence to give reasonable assurance that the Group financial statements are free from material misstatement, 
whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of the presentation 
of information in the Group financial statements.
Opinion
In our opinion:
I  the Group financial statements give a true and fair view, in accordance with IFRS as adopted by the European Union, of the state 
of the Group’s affairs as at 30 September 2008 and of its profit for the year then ended; 
I the Group financial statements have been properly prepared in accordance with the Companies Act 1985; and
I the information given in the Directors’ report is consistent with the Group financial statements.
Ernst & Young LLP
Registered auditor
Newcastle-upon-Tyne
19 December 2008 
Notes:
1.  The maintenance and integrity of the Zytronic plc web site is the responsibility of the Directors; the work carried out by the auditors 
does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may 
have occurred to the financial statements since they were initially presented on the web site.
2.  Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation 
in other jurisdictions.
Independent auditors’ report
to the members of Zytronic plc 28
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
     30 September 30 September 
     2008 2007 
    Notes £’000 £’000
Group revenue    2 14,717 11,437
Cost of sales     9,978 7,971
Gross profit     4,739 3,466
Distribution costs     217 197
Administration expenses     2,675 2,556
Group trading profit    3 1,847 713
Other operating income     27 36
Group operating profit from continuing operations     1,874 749
Finance costs    5(a) (146) (73)
Finance revenue    5(b) 12 7
Profit from continuing operations     1,740 683
T ax expense    6 (677) (149)
Profit for the year from continuing operations     1,063 534
Earnings per share   
Earnings per share – basic    8 7.3p 3.6p
Earnings per share – diluted    8 7.2p 3.6p
     30 September 30 September 
     2008 2007 
     £’000 £’000
Income and expense recognised directly in equity   
Current tax recognised directly in equity     5 3
Deferred tax recognised directly in equity     (7) (55)
Net expense recognised directly in equity     (2) (52)
Profit for the year     1,063 534
Total recognised income and expense for the year     1,061 482
Consolidated statement of recognised 
income and expense
for the year ended 30 September 2008
Consolidated income statement
for the year ended 30 September 2008 29
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
     30 September 30 September 
     2008 2007 
    Notes £’000 £’000
Assets    
Non-current assets    
Intangible assets    9 2,058 2,122
Property, plant and equipment    10 5,315 5,208
Trade and other receivables    12(b) 210 194
     7,583 7,524
Current assets    
Inventories    11 2,496 1,828
Trade and other receivables    12(a) 3,039 2,767
Cash and short term deposits    13 1,260 317
     6,795 4,912
Total assets     14,378 12,436
Equity and liabilities    
Current liabilities    
Trade and other payables    14 1,480 1,376
Financial liabilities    15 1,182 621
Accruals and deferred income    14 533 399
T axation liabilities     341 —
     3,536 2,396
Non-current liabilities      
Financial liabilities    16 1,088 1,340
Deferred tax liabilities (net)    19 817 479
Government grants     55 —
     1,960 1,819
Total liabilities     5,496 4,215
Net assets     8,882 8,221
Capital and reserves    
Equity share capital    21 147 147
Share premium    22 6,479 6,473
Revenue reserve    22 2,256 1,601
Total equity     8,882 8,221
These financial statements have been approved by the Board of Directors on 3 December 2008 and signed on their behalf by:
John M Kennair MBE D G W Mullan, B.Sc, FCA
Chairman Finance Director 
19 December 2008
 
Consolidated balance sheet
at 30 September 2008 30
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
     30 September 30 September 
     2008 2007 
    Notes £’000 £’000
Operating activities     
Profit before tax     1,740 683
Net interest expense     134 66
Depreciation of property, plant and equipment     565 453
Amortisation of intangible assets     310 285
Amortisation of government grant     (5) —
Share-based payments     34 46
Gain on sale of property, plant and equipment     — (1)
Increase in inventories     (668) (122)
Increase in trade and other receivables     (301) (96)
Increase in trade and other payables     166 34
Cash generated from operations     1,975 1,348
T axation repayments/(paid)     13 (29)
Net cashflow from operating activities     1,988 1,319
Investing activities      
Interest received     12 7
Receipt of government grant     60 —
Sale of property, plant and equipment     — 1
Purchases of property, plant and equipment    10(b) (605) (1,816)
Payments to acquire intangible assets     (246) (287)
Net cashflow from investing activities     (779) (2,095)
Financing activities     
Interest paid     (141) (73)
Dividends paid to equity shareholders of the parent     (440) (439)
Proceeds from share issues re options     6 24
New borrowings     438 1,123
Repayment of borrowings     (96) (134)
Repayment of capital element of finance lease and hire purchase contracts   (465) (78)
Net cashflow from financing activities     (698) 423
Increase/(decrease) in cash and cash equivalents     511 (353)
Cash and cash equivalents at the beginning of the year    13 140 493
Cash and cash equivalents at the year end    13 651 140
Consolidated cashflow statement
for the year ended 30 September 2008 31
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
1. Accounting policies
(a) Statement of compliance
The consolidated financial statements have been prepared in accordance with IFRS as adopted for use in the European Union and 
as applied in accordance with the provisions of the Companies Act 1985. The Directors consider the following accounting policies 
to be relevant in relation to the Group’s financial statements.
(b) Judgements and key sources of estimation uncertainty
The preparation of financial statements in conformity with generally accepted accounting principles requires the Directors to make 
judgements and assumptions that affect the reported amounts of assets, liabilities and disclosures at the date of the financial statements 
and the reported income and expense during the year. Although these judgements and assumptions are based on the Directors’ best 
knowledge of the amount, events or actions, actual results may differ from those estimates.
In the process of applying the Group’s accounting policies, the Directors have made the following judgements, apart from those 
involving estimations, which have the most significant effect on the amounts recognised in the financial statements:
Impairment of non-financial assets
The Group assesses whether there are any indicators of impairment as at the transition date and thereafter for all non-financial assets at 
each reporting date. Goodwill is tested for impairment annually and at other times when such indicators exist. Other non-financial assets 
are tested for impairment when there are indicators that the carrying amounts may not be recoverable.
When value in use calculations are undertaken, management must estimate the expected future cashflows from the asset or 
cash generating unit and choose a suitable discount rate in order to calculate the present value of those cashflows.
Development costs
Development costs are capitalised in accordance with the accounting policy given below. Initial capitalisation of costs is based on 
management’s judgement that technological and economical feasibility is confirmed, usually when a product development project 
has reached a defined milestone.
(c) Basis of consolidation and goodwill
The consolidated financial statements comprise the financial statements of Zytronic plc and its subsidiaries as at 30 September 
each year. They are presented in Sterling and all values are rounded to the nearest thousand pounds (£’000) except where 
otherwise indicated.
All intra-group balances and transactions, including unrealised profits arising from them, are eliminated. 
Subsidiaries are consolidated from the date of their acquisition, being the date on which the Group obtains control, and continue 
to be consolidated until the date that such control ceases.
Acquisitions are accounted for using the purchase method. Goodwill arising on acquisitions is initially measured at cost, being the 
excess of the cost of the acquisition over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent 
liabilities, is capitalised and classified as an asset on the balance sheet, and is not amortised. After initial recognition, goodwill is stated 
at cost less any accumulated impairment losses, with the carrying value being reviewed for impairment, at least on an annual basis 
and whenever events or changes in circumstances indicate that the carrying value may be impaired. This requires an estimation of 
the value in use of the cash-generating units to which the goodwill is allocated.
When subsidiaries are sold, the difference between the selling price and the net assets plus unimpaired goodwill is recognised 
in the consolidated income statement. 
Goodwill recognised as an asset as at 30 September 2006 is recorded at its carrying amount under UK GAAP and is subject 
to impairment review but is not amortised. 
(d) Foreign currencies
The consolidated financial statements are presented in Sterling, which is the Company’s functional and presentation currency. 
Transactions in foreign currencies are initially recorded in the functional currency at the rate ruling at the date of transaction. 
Monetary assets and liabilities denominated in foreign currencies are retranslated at the functional currency rate of exchange ruling 
at the balance sheet date. All differences are taken to the income statement. Non-monetary items that are measured in terms of 
historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. 
Notes to the financial statements
for the year ended 30 September 2008 32
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
1. Accounting policies (continued)
(e) Property , plant and equipment
Property, plant and equipment is stated at cost less accumulated depreciation and impairment charges. Such costs include those 
directly attributable to making the asset capable of operating as intended and the cost of replacing significant parts of such plant and 
equipment when that cost is incurred, if the recognition criteria are met. Depreciation is provided on all property, plant and equipment, 
other than freehold land, at rates calculated to write off the cost, less estimated residual value, of each asset evenly over its expected 
useful life, as follows:
Freehold property – 50 years 
Short leasehold property – over the term of the lease 
Plant and machinery – varying rates between 5% and 25% per annum
Any gain or loss arising on disposal of an asset (calculated as the difference between the net disposal proceeds and the carrying amount 
of the asset) is included in the income statement in the year the asset is derecognised. 
The assets’ residual values, useful lives and methods of depreciation are reviewed at each financial year end and adjusted, if appropriate. 
The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists 
the Group makes an estimate of the asset’s recoverable amount. An asset’s recoverable amount is the higher of the asset’s fair value, 
or the cash-generating unit’s fair value of which it forms part, less costs to sell and its value in use and is determined for an individual 
asset, unless the asset does not generate cash inflows that are largely independent of those from other assets or groups of assets. 
Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its 
recoverable amount. Impairment losses of continuing operations are recognised in the income statement in those expense categories 
consistent with the function of the impaired asset.
(f) Intangible assets
Intangible assets acquired separately are measured on initial recognition at cost. The cost of intangible assets acquired in a business 
combination is deemed to be their fair value as at the date of acquisition. Following initial recognition, intangible assets are carried at 
cost less any accumulated amortisation and any accumulated impairment losses. Other than capitalised development costs, internally 
generated intangible assets are not capitalised.
Intangible assets are amortised on a straight line basis over their useful economic lives and reviewed for impairment at each financial 
year end. The amortisation expense on intangible assets is recognised in the income statement in the expense category consistent 
with the function of the intangible asset. The estimated useful lives are as follows:
Licences – period of licensing agreements (10 and 17 years) 
Capitalised development expenditure – 4 to 10 years
(g) Research and development costs
Research expenditure is written off as incurred. An intangible asset arising from development expenditure on an individual project is 
recognised only when the Group can demonstrate the technical feasibility of completing the intangible asset so that it will be available 
for use or sale, its intention to complete and its ability to use or sell the asset, how the asset will generate future economic benefits, 
the availability of resources to complete the asset and the ability to measure reliably the expenditure during the development. 
During the period of development, the asset is tested annually for impairment. Following the initial recognition of the development 
expenditure, the cost model (as defined in IFRS) is applied, requiring the asset to be carried at cost less any accumulated amortisation 
and accumulated impairment losses. Amortisation of the asset begins when development is complete and the asset is available for 
use. It is amortised over the period of expected future sales.
(h) Inventories
Inventories are valued at the lower of cost and net realisable value. Costs incurred in bringing each product to its present location 
and condition are accounted for as follows:
Raw materials and consumables – purchase cost on a first-in, first-out basis; and 
Finished goods and work in progress –  cost of direct materials and labour and a proportion of manufacturing overheads based 
on normal operating capacity but excluding borrowing costs.
Net realisable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the 
estimated costs necessary to make the sale.
Notes to the financial statements
for the year ended 30 September 2008 continued 33
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
1. Accounting policies (continued)
(i) Trade and other receivables
Trade receivables are recognised and carried at original amount less an allowance for any uncollectable amounts. An estimate 
for doubtful debts is made when collection of the full amount is no longer probable. Bad debts are written off when identified. 
Trade and other receivables do not carry interest.
(j) 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 initial maturity 
of three months or less. Bank overdrafts are shown within financial liabilities, in current liabilities on the balance sheet. For the purpose 
of the cashflow statement, cash and cash equivalents comprise these balances, net of outstanding bank overdrafts.
(k) Interest-bearing loans and borrowings
All loans and borrowings are initially recognised at the fair value of the consideration received less directly attributable transaction costs. 
After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the effective 
interest method. 
Gains and losses are recognised in the income statement when the liabilities are derecognised, as well as through the amortisation process.
Borrowing costs are recognised as an expense when incurred.
(l) Derecognition of financial assets and liabilities
A financial asset or financial liability is derecognised when the contract that gives rise to it is discharged, sold, cancelled or expires.
Where an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of 
an existing liability are substantially modified, such an exchange or modification is treated as a de-recognition of the original liability 
and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in the income statement.
(m) Pension scheme
The Group operates a group personal pension scheme, which is a defined contribution scheme, for its employees. Contributions 
are recognised in the income statement as they become payable in accordance with the rules of the scheme.
(n) Leases
Group as a lessee
Finance leases, which transfer to the Group substantially all the risks and benefits incidental to ownership of the leased item, 
are capitalised at the inception of the lease at the fair value of the leased asset or, if lower, at the present value of the minimum 
lease payments. Lease payments are apportioned between the finance charges and reduction of the lease liability so as to achieve 
a constant rate of interest on the remaining balance of the liability. Finance charges are charged directly against income. Assets 
held under finance leases are depreciated over the shorter of the estimated useful life of the asset and the lease term.
The same policy is adopted for assets acquired under HP arrangements.
Leases where the lessor retains a significant portion of the risks and benefits of ownership of the asset are classified as operating 
leases and payments are recognised as an expense in the income statement on a straight line basis over the lease term.
(o) Share-based payment transactions
Equity-settled transactions
The cost of equity-settled transactions with employees is measured by reference to the fair value at the date at which they are granted 
and is recognised as an expense over the vesting period, which ends on the date on which the relevant employees become fully entitled 
to the award. Fair value is determined using an appropriate pricing model. In valuing equity-settled transactions, no account is taken 
of any vesting conditions, other than conditions linked to the price of the shares of the Company (market conditions).
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition, 
which are treated as vesting irrespective of whether or not the market condition is satisfied, provided that all other performance conditions 
are satisfied.
At each balance sheet date before vesting, the cumulative expense is calculated, representing the extent to which the vesting period 
has expired and management’s best estimate of the achievement or otherwise of non-market conditions and the number of equity 
instruments that will ultimately vest, or in the case of an instrument subject to a market condition, be treated as vesting. The movement 
in cumulative expense since the previous balance sheet date is recognised in the income statement, with a corresponding entry 
in equity. 34
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
1. Accounting policies (continued)
(o) Share-based payment transactions (continued)
Equity-settled transactions (continued)
Where the terms of an equity-settled award are modified or a new award is designated as replacing a cancelled or settled award, 
the cost based on the original award terms continues to be recognised over the original vesting period. In addition, an expense is 
recognised over the remainder of the new vesting period for the incremental fair value of any modification, based on the difference 
between the fair value of the original award and the fair value of the modified award, both as measured on the date of the modification. 
No reduction is recognised if this difference is negative.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any cost not yet recognised 
in the income statement for the award is expensed immediately. Any compensation paid up to the fair value of the award at the cancellation 
or settlement date is deducted from equity, with any excess over fair value being treated as an expense in the income statement.
IFRS 2 Share-based Payments has only been applied to grants of equity instruments after 7 November 2002 that had not vested at 
1 October 2006. For awards granted before 7 November 2002, the Group recognises only the intrinsic value or cost of these potential 
awards as an expense. This is accrued over the performance period of each plan based on the intrinsic value of the equity-settled awards.
(p) Revenue recognition
Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to 
the buyer. This is when the goods have been dispatched or made available to the customer, an invoice has been raised for them 
and the Group’s obligations to the customer have been met. There is not usually any significant delay between the occurrence 
of these three events.
Revenue is measured at the fair value of the consideration received, excluding discounts, rebates, and other sales taxes. Appropriate 
provisions for known returns are deducted from revenue.
(q) Government grants
Government grants are recognised where there is reasonable assurance that the grant will be received and all attaching conditions 
will be complied with, normally when a grant claim has been approved by the Government authority and the grant monies have been 
received. The fair value of grants is credited to a deferred income account and released to the income statement over the life of the 
projects to which they relate.
(r) Royalty payments
Under the terms of its patent licence, Zytronic Displays Limited pays royalties to the patent owner on the value of the touch sensors which 
it sells. An agreed annual payment is made by monthly instalment under the licence.
In the event that the actual quarterly royalties due from Zytronic Displays Limited exceed the payments on account for that quarter, 
Zytronic Displays Limited pays the balance to the patent owner.
In the event that the payments on account for that quarter exceed the actual royalties due to that date, the excess payment is treated 
by Zytronic Displays Limited as a prepayment of royalties that will become due in the future. Similarly, should the annual agreed 
payment be in excess of the royalties due for the year, the difference is rolled over and deducted from future years’ royalty calculations.
Management reviews its forecasts of future sales to determine whether any impairment has occurred which might affect the carrying 
value of the prepayment.
From 1 January 2008, and for each subsequent calendar year, the annual payment will increase either by the greater of RPI or to the 
level of the previous year’s actual royalties.
(s) Deferred tax
Deferred tax is recognised in respect of all temporary differences arising between the tax bases of assets and liabilities and their 
carrying amounts in the financial statements, with the following exceptions:
I  where the temporary difference arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not 
a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss;
I  in respect of taxable temporary differences associated with investments in subsidiaries, associates and joint ventures, where the 
timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse 
in the foreseeable future; and
I  deferred taxation assets are recognised only to the extent that the Directors consider that it is more likely than not that there will be 
suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.
Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which the related asset 
or liability is settled, based on tax rates and laws enacted or substantively enacted at the balance sheet date.
Notes to the financial statements
for the year ended 30 September 2008 continued 35
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
1. Accounting policies (continued)
(t) New standards and interpretations not applied
The International Accounting Standards Boards (“IASB”) and the International Financial Reporting Interpretations Committee (“IFRIC”) 
have issued the following standards and interpretations with an effective date after the date of these financial statements:
IASB      Effective date
IFRS 1 and IAS 27 Amendments to IFRS 1 and IAS 27 Amendments for Determining     1 January 2009 
 the Cost of an Investment in Separate Financial Statements    
IFRS 2 Amendment to IFRS 2 Vesting Conditions and Cancellations    1 January 2009
IFRS 3 Business Combinations (revised January 2008)     1 July 2009
IFRS 8 Operating Segments      1 January 2009
IAS 1 Presentation of Financial Statements (revised September 2007)    1 January 2009
IAS 23 Borrowing Costs (revised March 2007)     1 January 2009 
IAS 27 Consolidated and Separate Financial Statements (revised January 2008)   1 July 2009
IAS 32 and IAS 1 Amendments to IAS 32 and IAS 1 Puttable Financial Instruments and    1 January 2009 
 Obligations Arising on Liquidation    
IAS 39 Amendment to IAS 39 Eligible Hedged Items     1 July 2009
IAS 39 and IFRS 7 Amendments to IAS 39 and IFRS 7 Reclassification of Financial Assets   1 July 2008
 Annual Improvements Standard Published in May 2008    1 January 2009
IFRIC
IFRIC 12 Service Concession Arrangements      1 January 2008
IFRIC 13 Customer Loyalty Programmes      1 July 2008
IFRIC 14 The Limit on a Defined Benefit Asset, Minimum Funding Requirements   1 January 2008
 and their Interaction      
IFRIC 15 Agreements for the Construction of Real Estate     1 January 2009
IFRIC 16 Hedges of a Net Investment in a Foreign Operation    1 October 2008
IFRIC 17 Distribution of Non-cash Assets to Owners     1 July 2009
IAS 23 has been revised to require capitalisation of borrowing costs when such costs relate to a qualifying asset. A qualifying asset is 
an asset that necessarily takes a substantial period of time to get ready for its intended use or sale. In accordance with the transitional 
provisions in the standard, the Group will adopt this as a prospective change. Accordingly, borrowing costs will be capitalised on 
qualifying assets with a commencement date of 1 January 2009. No changes will be made for borrowing costs incurred prior to this 
date that have been expensed.
Whilst the revised IAS 1 will have no impact on the measurement of the Group’s results or net assets, it is likely to result in certain 
changes in the presentation of the Group’s financial statements from 2009 onwards.
IFRS 8 requires disclosure based on information presented to the Board. Whilst this is not expected to change the business segments 
about which information is given, the secondary segment information will be replaced by group-wide analysis of revenues and 
non-current assets by major geographic area.
There is no significant impact from the standards not applied.  36
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
2. Group revenue and segmental analysis
Revenue represents the invoiced amount of goods sold and services provided, stated net of value added tax.
The primary segment reporting format is determined to be this single business segment as the Group’s risks and rates of return are 
affected predominantly by differences in the products and services provided.
The Group has one reportable business segment comprising the development and manufacture of customised optical filters 
to enhance electronic display performance. Products in this reportable segment include touch sensors, filters and other laminated 
products as described on pages 6 and 7. All revenue, profits or losses before tax and net assets are attributable to this reportable 
business segment.
Secondary segment information is reported geographically. All manufacturing takes place in the UK and accordingly all segment assets 
are located in the UK. The analysis of segment revenue by geographical area based on the location of customers is given below.
   30 September  30 September  
   2008  2007  
   £’000 % £’000 %
Sale of goods –  UK   3,034 21 4,123 36
 – Americas   3,295 22 2,557 22
 – EMEA (excl. UK)   6,083 41 3,633 32
 – Asia Pacific (“APAC”)   2,305 16 1,124 10
Revenue   14,717 100 11,437 100
Finance revenue   12  7 
Total revenue   14,729  11,444 
It is not uncommon for global customers to alter the geographic destination of goods from one year to the next. In FY2007, for example, 
one customer announced the closure of its North American operations and the scaling back of its UK operations in favour of shifting 
more production to Hungary and China. The reduction in sales in the UK in FY2008 largely arises from this type of customer re-allocation. 
It does not reflect a loss of customers.
3. Group operating profit
This is stated after charging/(crediting):
     30 September 30 September 
     2008 2007 
     £’000 £’000
R&D costs     224 219
Amortisation of development expenditure     135 132
     359 351
Auditors’ remuneration – in respect of audit services*     59 45
 – in respect of taxation services     39 41
Depreciation of owned assets     423 408
Depreciation of assets held under finance lease and HP agreements    142 82
Amortisation of licences      120 116
Cost of inventories recognised as an expense including:     5,057 3,754
– write-down of inventories to net realisable value     166 113
– reversals of impairments in inventories**     (87) —
Hire of plant and machinery     7 2
Operating lease rentals – minimum lease payments     315 260
Amortisation of capital grants     (5) —
Net foreign currency differences     (56) 63
Rental income     (27) (36)
* £34,000 of this relates to the Company (2007: £20,700). 
** The reversal of impairments in inventories has arisen as a result of previously impaired stock being utilised.
Notes to the financial statements
for the year ended 30 September 2008 continued 37
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
4. Staff costs (including Directors)
     30 September 30 September 
     2008 2007 
     £’000 £’000
Wages and salaries     3,872 3,453
Social security costs     352 304
Other pension costs     43 41
     4,267 3,798
Included in wages and salaries is a total expense of share-based payments of £34,000 (2007: £46,000) all of which arises from 
transactions accounted for as equity-settled share-based payment transactions.
The total of Directors’ emoluments is set out in the Remuneration report. The aggregate value of contributions paid to money purchase 
pension schemes includes £5,100 (2007: £3,150) in respect of two Directors (2007: two).
The average number of employees during the year was made up as follows:
     30 September 30 September 
     2008 2007 
     Number Number
Production     167 153
Administration and sales     38 39
     205 192
The information required by Schedule 6 of the Companies Act is contained in the Remuneration report under Directors’ emoluments, 
pension contributions, Directors’ shareholdings, and Directors’ share options.
5. Finance costs (payable)/revenue receivable
(a) Finance costs
     30 September 30 September 
     2008 2007 
Interest payable     £’000 £’000
Finance charges payable under HP agreements and finance lease    (67) (2)
Bank loans and overdrafts     (79) (71)
     (146) (73)
(b) Finance revenue
     30 September 30 September 
     2008 2007 
Interest receivable     £’000 £’000
Bank interest receivable     12 7 38
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
6. Taxation
     30 September 30 September 
     2008 2007 
     £’000 £’000
Current tax    
UK corporation tax     (346) (3)
Corporation tax over-provided in prior years     — 12
T otal current tax (charge)/credit     (346) 9
Deferred tax    
Effect of change in tax rates and legislation on industrial buildings    (174) 18
Origination and reversal of temporary differences     (157) (176)
T otal deferred tax     (331) (158)
T ax charge in the income statement     (677) (149)
Tax relating to items charged or credited to equity
     30 September 30 September 
     2008 2007 
     £’000 £’000
Current tax
T ax on share-based payment     5 3
T otal current tax credit     5 3
Deferred tax
T ax on share-based payment     (7) (55)
T otal deferred tax charge     (7) (55)
T ax charge in the statement of recognised income and expense    (2) (52)
Reconciliation of the total tax charge   
The effective tax rate of the tax expense in the income statement for the year is higher than the standard rate of corporation tax in the 
UK of 29% (2007: 30%). The differences are reconciled below:
     30 September 30 September 
     2008 2007 
     £’000 £’000
Accounting profit before tax     1,740 683
Accounting profit multiplied by the UK standard rate of corporation tax (29%) (2007: 30%)   505 205
Effects of   
Expenses not deductible for tax purposes     24 6
Depreciation in respect of non-qualifying items     37 39
Enhanced tax reliefs     (64) (63)
Effect of changes in legislation on industrial buildings     204 —
Difference in tax rate     (29) (30)
T ax over-provided in previous years     — (12)
Other     — 4
T otal tax expense reported in the income statement     677 149
The UK corporation tax rate decreased from 30% to 28% from 1 April 2008. The average standard rate for the year has been calculated 
at 29%.
Notes to the financial statements
for the year ended 30 September 2008 continued 39
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
6. Taxation (continued)
Factors that may affect future tax charges
Under current tax legislation, some of the amortisation of licences will continue to be non-deductible for tax purposes.
Under HMRC’s R&D tax credit scheme, the Group will receive an annual uplift of 75% on qualifying R&D expenditure for tax purposes. 
Until the financial year 2006, where R&D expenditure has been capitalised, the benefit of this uplift is only recognised as the asset is 
amortised. The unrecognised element, relating to the year ended 30 September 2005 and prior, at 30 September 2008 was £100,000 
(2007: £90,000). Following changes to HMRC’s rules which took effect for financial year 2006, the uplift on expenditure which has been 
capitalised in any year is recognised in that year.
The “gain” on the exercise of share options, being the difference between the grant/exercise price and the market value at the time of 
exercise, is allowable as a taxable deduction from profits although it is not reflected within the income statement. These gains will arise 
in future years but their timing and amount is uncertain. 
There are tax losses carried forward at 30 September 2008 of £Nil (2007: £145,000).
7. Dividends
The Directors propose the payment of a final dividend of 3.0p per share (2007: 2.0p), payable on 9 March 2009 to shareholders on the 
Register on 20 February 2009. This dividend has not been accrued in these financial statements. The dividend payment will amount to 
some £440,000.
     30 September 30 September 
     2008 2007 
     £’000 £’000
Ordinary dividends on equity shares   
Final dividend of 2.0p per ordinary share paid on 16 March 2007    — 293
Interim dividend of 1.0p per ordinary share paid on 29 June 2007    — 146
Final dividend of 2.0p per ordinary share paid on 7 March 2008    293 —
Interim dividend of 1.0p per ordinary share paid on 27 June 2008    147 —
     440 439
8. Earnings per share
Basic earnings per share (“EPS”) is calculated by dividing the profit attributable to ordinary equity holders of the Company by the 
weighted average number of ordinary shares in issue during the year. All activities are continuing operations and therefore there 
is no difference between EPS arising from total operations and EPS arising from continuing operations.
  Weighted   Weighted  
  average    average  
   number     number   
 Earnings of shares EPS Earnings of shares EPS 
 30 September  30 September 30 September 30 September 30 September 30 September 
 2008 2008 2008 2007 2007 2007 
 £’000 Thousands Pence £’000 Thousands Pence
Profit on ordinary activities after taxation  1,063 14,667 7.3 534 14,640 3.6
Basic EPS 1,063 14,667 7.3 534 14,640 3.6
The weighted average number of shares for diluted EPS is calculated by including the weighted average number of shares under option.
  Weighted   Weighted  
  average    average  
   number     number   
 Earnings of shares EPS Earnings of shares EPS 
 30 September  30 September 30 September 30 September 30 September 30 September 
 2008 2008 2008 2007 2007 2007 
 £’000 Thousands Pence £’000 Thousands Pence
Profit on ordinary activities after taxation attributable  
to ordinary equity holders 1,063 14,667 7.3 534 14,640 3.6
Weighted average number of shares under option — 110 (0.1) — 147 —
Diluted EPS 1,063 14,777 7.2 534 14,787 3.6 40
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
9. Intangible fixed assets
     Development  
  Software Goodwill  Licences  expenditure  T otal 
Group  £’000 £’000  £’000 £’000  £’000
Cost:       
At 30 September 2006  172 235 1,976 1,194 3,577
Additions  85 — 50 152 287
At 30 September 2007  257 235 2,026 1,346 3,864
Additions  27 — 46 173 246
At 30 September 2008  284 235 2,072 1,519 4,110
Amortisation:      
At 30 September 2006  78 — 735 644 1,457
Provided during the year  37 — 116 132 285
At 30 September 2007  115 — 851 776 1,742
Provided during the year  55 — 120 135 310
At 30 September 2008  170 — 971 911 2,052
Net book value at 30 September 2008  114 235 1,101 608 2,058
Net book value at 30 September 2007  142 235 1,175 570 2,122
Net book value at 30 September 2006  94 235 1,241 550 2,120
As from the date of transition to IFRS, goodwill is no longer amortised but is now subject to an annual impairment test.
Impairment of goodwill
The goodwill of £235,000 relates to the operations of Intasolve Limited which were merged into the business of Zytronic Displays Limited 
on 1 September 2002. 
Zytronic Displays Limited operates in one continuing area of activity, which is the lowest level at which goodwill is monitored for internal 
purposes. That activity has demonstrated underlying growth in sales revenues, gross profit margins, profitability before tax and cash 
generation over recent years. 
The recoverable amount of goodwill has been determined based on a value in use calculation for the cash-generating unit, using 
cashflow projections based on financial budgets and forecasts approved by senior management covering a three-year period. 
Growth has been extrapolated forward from the end of the forecasts, using a growth rate of 3% which reflects the Directors’ view 
of the long-term growth rate in the business.
The cashflows for all cash-generating units have been discounted using a discount rate of 10%, based on the Group’s weighted 
average cost of capital.
The calculation of value in use is most sensitive to the forecast operating cashflows, the discount rate and the growth rate used 
to extrapolate cashfiows beyond the budget period. The operating cashflows are based on assumptions of revenue, cost of sales 
and general overheads. These assumptions are influenced by several factors both internally and externally.
The Directors consider the assumptions used to be consistent with the historical performance and to be realistically achievable in light 
of economic and industry measures and forecasts. It is believed that any reasonably possible movement on assumptions will not lead 
to an impairment and we have therefore not presented any sensitivity analysis.
Notes to the financial statements
for the year ended 30 September 2008 continued 41
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
10. Property, plant and equipment
The amounts carried in the balance sheet comprise:
    Short   
   Freehold leasehold Plant and   
  Land  property property  machinery T otal 
  £’000  £’000  £’000 £’000 £’000
Cost:      
At 30 September 2006  100 768 161 7,065 8,094
Additions  — 620 35 1,269 1,924
Disposals  — — — (1) (1)
At 30 September 2007  100 1,388 196 8,333 10,017
Additions  — 111 — 561 672
Disposals  — — — (12) (12)
At 30 September 2008  100 1,499 196 8,882 10,677
Depreciation:
At 30 September 2006  — 5 11 4,341 4,357
Provided during the year  — 22 13 418 453
Disposals  — — — (1) (1)
At 30 September 2007  — 27 24 4,758 4,809
Provided during the year  — 29 15 521 565
Disposals  — — — (12) (12)
At 30 September 2008  — 56 39 5,267 5,362
Net book value at 30 September 2008  100 1,443 157 3,615 5,315
Net book value at 30 September 2007  100 1,361 172 3,575 5,208
Net book value at 30 September 2006  100 763 150 2,818 3,831
Included in the amounts for plant and machinery are the following amounts relating to assets acquired under a finance lease:
     30 September 30 September 
     2008 2007 
     £’000 £’000
Cost      — 684
Accumulated depreciation     — 330
Included in the amounts for plant and machinery are the following amounts relating to assets acquired under HP agreements:
     30 September 30 September 
     2008 2007 
     £’000 £’000
Cost      2,241 1,288
Accumulated depreciation     535 62 42
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
11. Inventories
     30 September 30 September 
     2008 2007 
     £’000 £’000
Raw materials and consumables     1,341 999
Work in progress     725 473
Finished goods     430 356
     2,496 1,828
The difference between purchase price or production cost of stocks and their replacement cost is not material.
12. Trade and other receivables
(a) Current assets
     30 September 30 September 
     2008 2007 
     £’000 £’000
Trade receivables     2,599 2,576
VAT recoverable     202 53
Prepayments and accrued income     238 138
     3,039 2,767
Trade receivables are denominated in the following currencies:
     30 September 30 September 
     2008 2007 
     £’000 £’000
Sterling     1,358 1,782
US Dollar     1,145 491
Euro     96 303
     2,599 2,576
Out of the carrying amount of trade receivables of £2.6m (2007: £2.6m), £1.4m (2007: £1.3m) is the amount of debts owed by three 
major customers.
Trade receivables are non-interest bearing and are generally on 30–60 days’ terms. They are shown net of a provision for impairment.
As at 30 September 2008, trade receivables at a nominal value of £101,000 (2007: £33,000) were impaired. Movements in the provision 
for impairment of trade receivables were as follows:
      £’000
At 30 September 2006      5
Charge for the year      32
Utilised      (4)
At 30 September 2007      33
Charge for the year      73
Utilised      (5)
At 30 September 2008      101
Notes to the financial statements
for the year ended 30 September 2008 continued 43
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
12. Trade and other receivables (continued)
(a) Current assets (continued)
At 30 September, the ageing analysis of trade receivables overdue but not impaired is as follows:
 Past due but not impaired
   Neither past due 0–3 months >3 months T otal 
   nor impaired £’000 £’000 £’000
2008   1,618 874 107 2,599
2007   1,703 820 53 2,576
(b) Non-current assets
     30 September 30 September 
     2008 2007 
     £’000 £’000
Royalty prepayments     210 194
13. Cash and short term deposits
     30 September 30 September 
     2008 2007 
     £’000 £’000
Cash at bank and in hand     1,260 317
Cash at bank earns interest at floating rates based on daily bank deposit rates.
At 30 September 2008, the Group had available £2.9m (2007: £1.3m) of undrawn committed borrowing facilities in respect of which all 
conditions precedent had been met. £0.9m (2007: £1.3m) of these facilities fall for review within one year and the remainder is available 
until 30 June 2010.
For the purpose of the consolidated cashflow statement, cash and cash equivalents comprise the following:
     30 September 30 September 
     2008 2007 
     £’000 £’000
Cash at bank and in hand     1,260 317
Bank overdraft     (609) (177)
     651 140
The fair value of cash and cash equivalents is £651,000 (2007: £140,000). 44
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
14. Trade and other payables
     30 September 30 September 
     2008 2007 
     £’000 £’000
Trade payables     1,371 1,267
Other taxes and social security costs     109 109
     1,480 1,376
Accruals and deferred income     533 399
     2,013 1,775
15. Financial liabilities – current
     30 September 30 September 
     2008 2007 
     £’000 £’000
Bank loan (note 17a)     33 7
Bank loan (note 17b)     64 63
Obligations under HP agreements (notes 17c and 18a)     476 374
Bank overdrafts     609 177
     1,182 621
16. Financial liabilities – non-current
     30 September 30 September 
     2008 2007 
     £’000 £’000
Bank loan (note 17a)     39 —
Bank loan (note 17b)     529 591
Obligations under HP agreements (notes 17c and 18a)     520 749
     1,088 1,340
17. Bank loans
(a) Chattel mortgage
On 28 September 2004, Zytronic Displays Limited entered into a term loan with Yorkshire Bank which is secured by a chattel mortgage over 
certain items of plant and machinery. Interest is payable at 1% above that bank’s base rate. The loan has been guaranteed by Zytronic plc. 
The original loan of £250,000, repayable in 36 equal monthly instalments, was paid off in November 2007. On 23 November 2007 an additional 
amount of £100,000 was borrowed under the terms of this same chattel mortgage, again repayable by 36 equal monthly instalments.
(b) Property mortgage
On 13 January 2006, Zytronic plc drew down funds under a ten year mortgage with Lloyds TSB Bank plc under which it borrowed 
£750,000, repayable by monthly instalments. The loan is secured against its freehold interest in Britannia Court, the adjoining factory 
premises which it acquired in January 2006. Interest is payable at 1.25% above that bank’s base rate.
(c) HP agreements
In September 2007, Zytronic Displays Limited put in place six HP agreements with Yorkshire Bank. These agreements provide 
longer term funding for some of the significant capital expenditure incurred in the refurbishment of Britannia Court and its equipping 
as a manufacturing facility for ZYPOS, and other touch sensors. The net amounts advanced under those HP agreements total 
£1.123m and the term of each is three years. In the year ended 30 September 2008, a further four HP agreements were put in place 
with Yorkshire Bank to provide the final funding for equipping the new manufacturing facility. These agreements total £0.338m and 
are also repayable over three years. All of these HP agreements are guaranteed by Zytronic plc. 
Notes to the financial statements
for the year ended 30 September 2008 continued 45
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
18. Obligations under HP agreements and leases
(a) Obligations under HP agreements
     30 September 30 September 
     2008 2007 
     £’000 £’000
Minimum HP payments:   
Not later than one year     476 374
Later than one year and not later than five years     520 749
     996 1,123
The finance lease and HP contracts at 30 September 2008 attract variable interest which is payable separately on the balance of capital 
outstanding. As such, the amounts payable at 30 September 2008 do not include a liability for finance charges.
(b) Obligations under operating leases
Minimum lease payments under non-cancellable operating leases are as follows:
     30 September 30 September 
     2008 2007 
Group as lessee     £’000 £’000
Operating leases which expire:   
Not later than one year     252 253
Later than one year and not later than five years     952 936
Later than five years     807 1,018
     2,011 2,207
19. Deferred taxation liability/(asset)
The deferred tax included in the balance sheet is as follows:
     30 September 30 September 
     2008 2007 
     £’000 £’000
Deferred tax liability
Accelerated capital allowances     (731) (465)
R&D tax credit     (117) (84)
Other     (2) —
     (850) (549)
Deferred tax asset      
Share-based payment     32 28
Pension asset     1 1
T ax losses carried forward     — 41
     33 70
Disclosed on the balance sheet     (817) (479) 46
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Notes to the financial statements
for the year ended 30 September 2008 continued
19. Deferred taxation liability/(asset) (continued)
The deferred tax included in the Group income statement is as follows:
     30 September 30 September 
     2008 2007 
     £’000 £’000
Deferred tax in the income statement      
Accelerated capital allowances     (92) (174)
R&D tax credits     (33) (35)
T ax losses carried forward     (41) 41
Share-based payment     8 (3)
Other     1 (5)
     (157) (176)
Impact of charge in tax rates on opening balances     — 18
Impact of charge in legislation of industrial buildings on opening balances    (174) —
Deferred income tax expense     (331) (158)
20. Financial risk management policy and financial instruments
The Group’s principal financial instruments comprise two secured bank loans, ten HP agreements, an overdraft facility and cash. 
The main purpose of these financial instruments is to raise finance for the Group’s operations. The Group has various other 
financial instruments, such as trade debtors and trade creditors that arise directly from its operations.
The main risks associated with the Group’s financial assets and liabilities are set out below:
Credit risk
The risk of financial loss due to a counterparty’s failure to honour its obligations arises principally in relation to transactions where the 
Group provides goods on deferred terms. 
Group policies are aimed at minimising such losses, and require that deferred terms are granted only to customers who demonstrate 
an appropriate payment history and/or satisfy credit worthiness procedures. Individual exposures are monitored with customers subject 
to credit limits to ensure that the Group’s exposure to bad debts is not significant. Goods may be sold on a cash-with-order basis to 
mitigate credit risk. 
Management’s assessment of the maximum credit risk exposure relating to financial assets is represented by carrying value as at the 
balance sheet date.
Liquidity risk
The Company aims to mitigate liquidity risk by managing cash generated by its operations. Capital expenditure is approved at Group level. 
Flexibility is maintained by retaining surplus cash in readily accessible bank accounts.
The Group has an unsecured overdraft facility of £1.5m arranged with its principal banker, Lloyds TSB Bank plc. This facility extends 
until 31 March 2009 and is to provide funding for working capital. On 25 October 2007, the Group entered into an additional facility with 
Lloyds TSB Bank plc, being a revolving credit facility for £2.0m, which extends until 30 June 2010. This facility is to provide additional 
working capital and funding for further capital expenditure, should it be required.
Foreign exchange risk 
The Group’s policy is that no trading in financial instruments should be undertaken. Spot contracts and forward currency contracts may 
be used to sell surplus US Dollars and Euros, generated from sales less purchases in those currencies. However the Group uses natural 
hedging as the main basis of minimising its exposure to these currencies. 47
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
20. Financial risk management policy and financial instruments (continued)
Interest rate risk
The Group has not sought to tie itself into fixed rate debt but has instead accepted a degree of interest rate risk from having only floating 
rate debt. This is because the Group has positive net cash balances, a relatively low level of borrowings and estimates that an increase 
of 1% in interest rates would not have a material effect on the Group’s pre-tax profits.
The current pressures within the financial markets have been well documented and the ‘credit crunch’ has resulted in reduced 
availability of certain types of finance and a significant increase in the cost of corporate debt. It is not clear how long current difficult 
market conditions will persist. However, as the Group has sufficient funding in place into 2010, the effects on the Group are minimal.
The main risks arising from the Group’s financial instruments are as follows:
I foreign currency risk – the magnitude of this risk that has arisen over the period is detailed below; and
I  interest rate risk on floating rate financial liabilities to the extent not covered by interest rate benefit on floating rate financial assets 
– details of floating rate financial liabilities and assets are below.
The following table demonstrates the sensitivity to a reasonably possible change in interest rates, with all other variables held constant, 
of the Group’s profit before tax (through the impact on floating rate borrowings). There is no impact on the Group’s equity.
      Effect 
     Increase/ on profit 
     decrease in before tax 
     basis points £’000
2008
Sterling     + 100 (35)
     – 100 35
2007
Sterling     + 100 (48)
     – 100 48
The floating rate financial assets comprise cash. The benchmarks for floating rates on both liabilities and assets is LIBOR and 
Bank of England base rate.
Currency exposures
The table below shows the Group’s currency exposures; in other words, those transactional exposures that give rise to the net currency 
gains and losses recognised in the income statement. Such exposures comprise the monetary assets and monetary liabilities of the 
Group that are not denominated in the operating currency of the Group.
These currency exposures were:
 Net foreign currency monetary assets
    US Dollar Euro T otal 
    £’000 £’000 £’000
30 September 2008    67 235 302
30 September 2007     245 7 252
The year-end net foreign currency monetary assets comprise cash and trade debtor balances less trade creditor balances. These 
are the inherent constituents of the natural hedging policy whereby foreign currency sales are turned into cash for the settlement of 
purchases of goods denominated in those foreign currencies. Cash at a month end is held to settle creditors’ payments due in the 
next two months and to meet future anticipated capital expenditure in those currencies. 48
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
20. Financial risk management policy and financial instruments (continued)
Maturity profile of financial liabilities
Year ended 30 September 2008
 On demand <3 months 3–12 months 1–5 years >5 years Total 
 £’000 £’000 £’000 £’000 £’000 £’000
Interest-bearing loans and borrowings 609 168 492 1,085 135 2,489
Trade and other payables  1,364 649 — — — 2,013
T otal 1,973 817 492 1,085 135 4,502
Interest-bearing loans and borrowings comprise principal repayments due of £2.27m and contractual interest payments of £219,000. 
Interest is calculated based on interest rates prevailing at the balance sheet date.
Year ended 30 September 2007
 On demand <3 months 3–12 months 1–5 years >5 years T otal 
 £’000 £’000 £’000 £’000 £’000 £’000
Interest-bearing loans and borrowings 177 145 404 1,217 347 2,290
Trade and other payables  1,249 526 — — — 1,775
T otal 1,426 671 404 1,217 347 4,065
Fair values of financial assets and financial liabilities
The fair value of all financial assets and liabilities is not significantly different to their carrying amount.
Set out below is a comparison by category of book values and fair values of the Group’s financial assets and financial liabilities:
 Book value  Fair value
   2008 2007 2008 2007 
    £’000 £’000 £’000 £’000
Financial assets
Cash and short term deposits   1,260 317 1,260 317
Financial liabilities
Overdraft   (609) (177) (609) (177)
Bank loans   (1,661) (1,784) (1,661) (1,784)
    (1,010) (1,644) (1,010) (1,644)
Notes to the financial statements
for the year ended 30 September 2008 continued 49
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
21. Share capital and share-based payments
(a) Share capital
   2008 2007   
   Number Number 2008 2007 
   Thousands Thousands £’000 £’000
Authorised:      
Ordinary shares of 1p each   25,000 25,000 250 250
Allotted, called up and fully paid:      
Ordinary shares 1p each   14,674 14,662 147 147
During the year the Group had five share option schemes, an Approved Executive Option Scheme, an Unapproved Executive 
Option Scheme, an Enterprise Management Incentive (“EMI”) Scheme and two Sharesave Schemes. Under these schemes, 
options to subscribe for the Company’s shares have been granted as follows:
   Granted Exercised Lapsed     
  30 September during  during  during  30 September   
  2007 year year year 2008 Exercise Option 
  Number  Number  Number  Number Number dates  price
Unapproved  
Executive Scheme 36,363 — — — 36,363 7 June 2003 to  110.0p 
       6 June 2010 
  — 12,700 — — 12,700 28 February 2011 to 216.5p 
       28 February 2018 
Sharesave Scheme         
(2003) – 5 year term 11,944 — 11,944 — — 1 April 2008 to  44.0p 
       30 September 2008 
(2008) – 3 year term — 55,490 — 1,745 53,745 1 April 2011 to 220.0p 
       30 September 2011 
 – 5 year term — 28,402 — — 28,402 1 April 2013 to 220.0p 
       30 September 2013 
EMI Scheme 100,000 — — — 100,000 16 March 2006 to 70.0p 
       15 March 2014 
  91,408 — — — 91,408 18 January 2008 to  145.5p 
       17 January 2015 
  87,250 — — 5,000 82,250 11 January 2009 to  274.5p 
       10 January 2016  
  — 87,800 — — 87,800 28 February 2011 to 216.5p
       28 February 2018 
Performance conditions have not been attached to the share options awarded under the EMI Scheme.
During the year, 11,944 ordinary shares, with an aggregate nominal value of £119.44, were allocated for cash at 44.0p each upon 
the exercise of two options. 50
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Notes to the financial statements
for the year ended 30 September 2008 continued
21. Share capital and share-based payments (continued)
(b) Share-based payments
Senior Executive Plan
Share options are granted to senior executives at the discretion of the remuneration committee. The exercise price of the options 
is equal to the market price of the shares at the date of grant. The options vest three years from the date of grant. The contractual 
life of each option granted is ten years. There are no cash settlement alternatives.
All Employee Share-option Plan, the Sharesave Scheme
Periodically the Board of Directors will agree to the setting up of a new Sharesave Scheme for all employees under the SAYE regulations. 
All employees are entitled to apply for a grant of options once they have been in service for three months. The options will vest if the 
employee remains in service for a period of three or five years from the date of grant. The exercise price of the options is equal to the 
market price of the shares less a discount decided by the Board of Directors on the date of grant. The contractual life of the options is 
three or five years with a six month exercise period.
Income statement expense for year ended 30 September 2008 
The expense recognised for share-based payments in respect of employee services received during the year to 30 September 2008 
is £34,000 (2007: £46,000).
The following table illustrates the number and weighted average exercise prices (“WAEP”) of, and movements in, share options during 
the year:
    2008  2007 
   2008 WAEP  2007 WAEP 
   Number Pence Number  Pence
Outstanding at 30 September
1
   326,965 149.2 348,783 146.7
Granted during the year   384,392 117.6 — —
Lapsed during the year   (6,745) 260.4 — —
Exercised   (11,944) 44.0
2
 (21,818) 110.0
3
Outstanding at 30 September   692,668 154.1 326,965 149.2
Exercisable at 30 September   242,998 106.7 136,363 80.7
1.  Included within this balance are options over 136,363 (2007: 136,363) shares that have not been recognised in accordance with IFRS 2 as the options had vested before 
1 October 2006. These options have not been subsequently modified and therefore do not need to be accounted for in accordance with IFRS 2.
2. The weighted average share price at the date of exercise for the options exercised is 193.5p.
3. The weighted average share price at the date of exercise for the options exercised is 163.0p.
For the share options outstanding as at 30 September 2008, the weighted average remaining contractual life is 6 years (2007: 7 years).
There were four grants of options during the year, as shown in note 21(a). The weighted average fair value of options granted during 
the year was 49.5p (2007: Nil). The range of exercise prices for options outstanding at the end of the year was 70.0p to 274.5p 
(2007: 44.0p to 274.5p).
The fair value of equity-settled share options granted is estimated as at the date of grant using a model designed by the 
Quoted Company Alliance (based on a Black-Scholes-Merton model), taking into account the terms and conditions upon which 
the options were granted. The following table lists the inputs to the model used for the years ended 30 September 2008 and 
30 September 2007:
     2008 2007
Dividend yield (%)     2.1% 2.1%
Expected share price volatility (%)     30.0% 20.0%
Risk-free interest rate (%)     4.3% 4.3%
Expected life of option (years)     3.5 to 5.0 3.5 to 5.0
The expected life of the options is based on historical data and is not necessarily indicative of exercise patterns that may occur. 
The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may also not necessarily 
be the actual outcome.
No other features of options grant were incorporated into the measurement of fair value. 51
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
21. Share capital and share-based payments (continued)
(c) Director’s share incentive scheme 
Share incentive scheme for Mark Cambridge, Chief Executive 
The remuneration committee agreed an incentive award scheme for Mark Cambridge, Chief Executive, to offer him up to 200,000 shares 
at a price of 25p per share to vest based on specified performance criteria.
These are measured by an EPS calculated on the audited pre-tax profit and a standard 28% tax charge. The EPS criteria are shown below:
 Performance criteria
 Lower limit  Upper limit
   EPS Shares EPS Shares 
   pence to vest pence to vest
Year to 30 September 2009 (year 1)   13.5 80,000 15.0 100,000
Year to 30 September 2010 (year 2)   18.3 60,000 22.0 80,000
Year to 30 September 2011 (year 3)   24.5 60,000 24.5 20,000
Vesting is:
I the entitlement to buy, which doesn’t disappear once earned;
I pro rata between the upper and lower limits;
I timed on signature of audited accounts with a clean audit report; and
I  cumulative, e.g. 200,000 shares can vest in year 3 if the upper limit is reached, even if the lower limits have not been achieved 
in the previous years.
If the 24.5p EPS criteria is not achieved in year 3, there will still be an opportunity for shares to vest in year 4 (to 30 September 2012) 
or year 5 (to 30 September 2013) on the achievement of 24.5p EPS on the basis that, on achievement, the maximum total entitlement 
reduces to 125,000 shares or 50,000 shares respectively, or the number of shares already vested if that is greater.
Vesting will also take place in the event of a successful takeover and will be based on the takeover price, with full vesting at a share price 
of 500p and pro rata vesting down to a price of 300p as follows:
I 1,000 shares for each 1p above 300p up to 500p until 30 September 2011, reduced for any shares which have already vested;
I  625 shares for each 1p above 300p up to 500p between 1 October 2011 and 30 September 2012, reduced for any shares which 
have already vested; and
I  250 shares for each 1p above 300p up to 500p between 1 October 2012 and 30 September 2013, reduced for any shares which 
have already vested. 52
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
22. Reconciliation of movements in equity
   Called   
    up share Share Retained 
   capital * premium ** earnings T otal
    £’000  £’000  £’000  £’000
At 30 September 2006   146 6,450 1,512 8,108
Exercise of share options   1 23 — 24
T otal recognised income and expense for the year   — — 482 482
Share-based payment   — — 46 46
Dividends   — — (439) (439)
At 30 September 2007   147 6,473 1,601 8,221
Exercise of share options   — 6 — 6
T otal recognised income and expense for the year   — — 1,061 1,061
Share-based payments   — — 34 34
Dividends   — — (440) (440)
At 30 September 2008   147 6,479 2,256 8,882
* Share capital represents proceeds on issue of the Company’s equity share capital. 
**  Share premium comprises the excess in proceeds on issue of the Company’s equity share capital above the normal value of the shares issued.
23. Capital commitments
Amounts contracted for at 30 September 2008 but not provided in the financial statements amounted to £Nil (2007: £300,000) 
for the Group.
24. Pension scheme commitments
Contributions for the year to 30 September 2008 amounted to £43,000 (2007: £41,000) and the outstanding contributions at the 
balance sheet date were £5,000 (2007: £8,000). The Group is a member of a group personal pension scheme which is a defined 
contribution scheme. Contributions are charged to the income statement as they become payable in accordance with the rules 
of the scheme.
25. Related party transactions
Related party transactions are dealt with under the heading Directors’ interests in material contracts in the Remuneration report. There 
are no other related party transactions required to be disclosed in the financial statements.
The key management personnel are considered to be the Directors of the Group. 
     2008 2007 
     £’000 £’000
Salaries/fees     353 274
Bonus     16 —
Pension contributions     5 3
Share-based payments     2 4
     376 281
26. Investments in subsidiary companies
Details of the investments in which Zytronic plc holds 20% or more of the nominal value of any class of share capital are as follows:
    Proportion of 
    voting rights and Nature of  
Name of Company   Holding shares held business
Zytronic Displays Limited   Ordinary shares 100% Manufacture of  
     transparent composites,  
     including touch sensors
Intasolve Limited   Ordinary shares 100% Dormant
Zytronic Glass Products Limited   Ordinary shares 100% Dormant
The trading subsidiary is incorporated in England.
Notes to the financial statements
for the year ended 30 September 2008 continued 53
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
27. Guarantees
Zytronic plc has given a guarantee to Yorkshire Bank in connection with the bank loan and HP agreements detailed in notes 17a and 17c 
and to Lloyds TSB Bank plc in connection with the overdraft facility and the revolving credit facility detailed in note 20.
28. Transition to IFRS 
Zytronic plc is required to report its consolidated financial results under IFRS for the financial year beginning 1 October 2007. This is 
the first year that the Group has presented its financial statements under IFRS. T o assess the impact on the Group’s financial results, 
this statement presents the reconciliations (from UK GAAP to IFRS) for the income statement for the year ended 30 September 2007 
and the balance sheet at 30 September 2007. A reconciliation of the net assets (from UK GAAP to IFRS) at the transition date, 
1 October 2006, has also been presented.
The restated financial information for the year ended 30 September 2007 and the opening balance sheet at 1 October 2006 are those 
which were notified to investors in the regulatory news service release on 28 May 2008. These are shown in the following three tables, 
(a) to (c), with an explanation of the differences between UK GAAP and IFRS in (d).
(a) Reconciliation of the consolidated income statement for the year ended 30 September 2007
     IAS 12  
     Deferred T ax on  
     Share-based  
     Payments, 30 September 
 Previously  IFRS 3 IAS 19 Employee Benefits 2007 
 reported  Goodwill Employee and Change in restated 
 under Reclassification Amortisation Benefits Treatment of IBAs under IFRS 
 UK GAAP (d(ii)) (d(iii)) (d(iv)) (d(v)) (audited) 
 £’000 £’000 £’000 £’000 £’000 £’000
Group revenue 11,434 3 — — — 11,437
Cost of sales (7,989) (3) 21 — — (7,971)
Gross profit 3,445 — 21 — — 3,466
Distribution costs (197) — — — — (197)
Administrative expenses (2,541) (36) — 21 — (2,556)
Group trading profit 707 (36) 21 21 — 713
Other operating income — 36 — — — 36
Group operating profit from  
continuing operations 707 — 21 21 — 749
Finance costs (73) — — — — (73)
Finance revenue 7 — — — — 7
Profit from continuing  
operations before taxation 641 — 21 21 — 683
T ax expense (100) — — — (49) (149)
Profit for the year from  
continuing operations 541 — 21 21 (49) 534 54
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
28. Transition to IFRS (continued)
(b) Reconciliation of reported equity at 30 September 2007
     IAS 12  
     Deferred T ax on  
     Share-based  
     Payments, 30 September 
 Previously  IFRS 3 IAS 19 Employee Benefits 2007 
 reported  Goodwill Employee and Change in restated 
 under Reclassification Amortisation Benefits Treatment of IBAs under IFRS 
 UK GAAP (d(ii)) (d(iii)) (d(iv)) (d(v)) (audited) 
 £’000 £’000 £’000 £’000 £’000 £’000
Assets      
Non-current assets      
Property, plant and equipment 5,350 (142) — — — 5,208
Intangible assets 1,959 142 21 — — 2,122
Trade and other receivables 194 — — — — 194
 7,503 — 21 — — 7,524
Current assets      
Inventories 1,828 — — — — 1,828
Trade and other receivables 2,767 — — — — 2,767
Cash and short term deposits 140 177 — — — 317
 4,735 177 — — — 4,912
Total assets 12,238 177 21 — — 12,436
Equity and liabilities      
Current liabilities      
Trade and other payables (1,376) — — — — (1,376)
Financial liabilities (444) (177) — — — (621)
Accruals and deferred income (381) — — (18) — (399)
 (2,201) (177) — (18) — (2,396)
Non-current liabilities      
Financial liabilities (1,340) — — — — (1,340)
Deferred tax liabilities (477) — — — (2) (479)
 (1,817) — — — (2) (1,819)
Total liabilities (4,018) (177) — (18) (2) (4,215)
Net assets 8,220 — 21 (18) (2) 8,221
Capital and reserves      
Equity share capital 147 — — — — 147
Share premium 6,473 — — — — 6,473
Revenue reserves 1,600 — 21 (18) (2) 1,601
Total equity 8,220 — 21 (18) (2) 8,221
Notes to the financial statements
for the year ended 30 September 2008 continued 55
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
28. Transition to IFRS (continued)
(c) Reconciliation of reported equity at 1 October 2006 (date of transition)
     IAS 12  
     Deferred T ax on  
     Share-based 30 September 
  Previously  IAS 19 Payments, 2007 
  reported  Employee Employee restated 
  under Reclassification Benefits Benefits under IFRS 
  UK GAAP (d(ii)) (d(iv)) (d(v)) (audited) 
  £’000 £’000 £’000 £’000 £’000
Assets     
Non-current assets     
Property, plant and equipment  3,831 (94) — — 3,737
Intangible assets  2,026 94 — — 2,120
  5,857 — — — 5,857
Current assets     
Inventories  1,706 — — — 1,706
Trade and other receivables  2,852 — — — 2,852
Cash and short term deposits  493 438 — — 931
  5,051 438 — — 5,489
Total assets  10,908 438 — — 11,346
Equity and liabilities     
Current liabilities     
Trade and other payables  (1,167) — — — (1,167)
Financial liabilities  (215) (438) — — (653)
Accruals and deferred income  (427) — (39) — (466)
T axation liabilities  (28) — — — (28)
  (1,837) (438) (39) — (2,314)
Non-current liabilities     
Financial liabilities  (658) — — — (658)
Deferred tax liabilities  (365) — — 99 (266)
  (1,023) — — 99 (924)
Total liabilities  (2,860) (438) (39) 99 (3,238)
Net assets  8,048 — (39) 99 8,108
Capital and reserves     
Equity share capital  146 — — — 146
Share premium  6,450 — — — 6,450
Revenue reserves  1,452 — (39) 99 1,512
Total equity  8,048 — (39) 99 8,108 56
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
28. Transition to IFRS (continued)
(d) Explanation of key UK GAAP to IFRS differences
(i) First time adoption (IFRS 1)
In accordance with the requirements of IFRS 1 First-time adoption of International Financial Reporting Standards, the Group is subject to 
a number of voluntary and mandatory exemptions from full restatement to the requirements of IFRS, which have been applied as follows:
I  IFRS 2 Share-based Payments has only been applied to grants of equity instruments after 7 November 2002 that had not vested 
at 1 October 2006; and
I  the Group has taken the option not to apply IFRS 3 Business Combinations retrospectively to acquisitions that occurred prior 
to 1 October 2006.
(ii) IAS 38 Intangible Assets
Under IAS 16 some items of software, which do not meet the criteria for recognition as plant and equipment have been reclassified 
as intangible assets. The adjustment was £142,000 at 30 September 2007 and £94,000 at 30 September 2006.
(iii) IFRS 3 Business Combinations
IFRS 3 does not permit the annual amortisation of goodwill, but does require an annual impairment review of carrying values. Under 
UK GAAP goodwill was amortised over the anticipated useful economic life of the transaction giving rise to the goodwill. Goodwill 
amortisation of £21,000 has been reversed in the year ended 30 September 2007.
(iv) IAS 19 Employee Benefits
IAS 19 requires an entity to recognise a liability when an employee has provided service in exchange for benefits that arise in the future. 
Holiday pay provisions for salaried employees were not accounted for under UK GAAP but now give rise to an adjustment under IFRS. 
The value of this adjustment in the financial statements is £18,000 at 30 September 2007 and £39,000 at 30 September 2006. In accordance 
with IAS 12 below, a deferred tax asset of £5,000 and £12,000 has been recognised respectively at each of these balance sheet dates. 
(v) IAS 12 Income T axes
Under UK tax legislation relating to share-based payments, corporation tax is recovered on the excess of the value of the shares on 
the date of exercise over the option price paid. Under IFRS 2, the cumulative expense recognised is based on the grant date fair value 
of those options. Accordingly under IAS 12, a temporary difference exists to the extent that the exercise price on outstanding options as 
at the balance sheet date differs from their grant date fair value. The requirement to recognise such a temporary difference applies even 
in cases where (because the options vested before 1 October 2006) no charge has been made under IFRS 2. As a result an additional 
deferred tax asset of £87,000 has been recognised as at 30 September 2006. Movements after that date giving rise to an additional 
asset of £11,000 as at 30 September 2007 have been taken to the income statement as equity, in accordance with IAS 12.
The deferred tax temporary difference on industrial buildings under IAS 12 gives rise to an increase of £18,000 in the deferred tax liability 
at 30 September 2007 (£Nil at 30 September 2006) compared to the timing difference under UK GAAP .
(vi) IAS 1 Presentation of Financial Statements
IAS 1 requires the split between current and non-current assets and liabilities on the face of the balance sheet. As a result the reconciliations 
set out include adjustments to reclassify assets and liabilities where required.
Cash balances have been reclassified to gross up for negative balances on various bank accounts, which had been netted off in the 
UK GAAP financial statements.
The layout and presentation of the cashflow statement in the 2008 annual report has been amended in accordance with IAS 7, which 
shows cashflows analysed between operating, investing and finance activities. The transition from UK GAAP to IFRS has no effect on 
the reported cashflows generated by the Group.
Notes to the financial statements
for the year ended 30 September 2008 continued 57
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Consolidated income statements
for the five years ended 30 September 2004 to 2008
  Year to Year to Year to Year to Year to 
  30 September 30 September 30 September 30 September 30 September 
  2008 2007 2006 2005 2004 
  £’000 £’000 £’000 £’000 £’000
Group revenue  14,717 11,437 12,301 10,590 8,756
Cost of sales  9,978 7,971 8,449 7,312 6,187
Gross profit  4,739 3,466 3,852 3,278 2,569
Distribution costs  217 197 170 140 121
Administration expenses  2,675 2,556 2,356 2,137 2,078
Group trading profit  1,847 713 1,326 1,001 370
Other operating income  27 36 — — —
Group operating profit from continuing activities  1,874 749 1,326 1,001 370
Finance costs   (146) (73) (59) (33) (26)
Finance revenue  12 7 6 16 6
Profit from continuing operations  1,740 683 1,273 984 350
T ax expense  (677) (149) (153) (310) (114)
Profit for the period from continuing operations  1,063 534 1,120 674 236
Earnings per share      
Earnings per share – basic  7.3p 3.6p 7.8p 4.7p 1.7p
Earnings per share – diluted  7.2p 3.6p 7.7p 4.6p 1.6p
Dividends per share  3.0p 3.0p 2.5p 0.5p —
The results for the years ended 30 September 2007 and 2008 are presented under IFRS whilst the results for the years ended 
30 September 2004 to 2006 are presented under UK GAAP .
In the years ended 30 September 2004 to 2006, there were no recognised gains or losses as defined in FRS 3 other than those 
stated above. The consolidated income statement on page 28 shows the Group statement of total recognised gains and losses 
for the year ended 30 September 2008.
The results for all the above years derive from continuing operations.
Dividends are shown in the accounts in the year in which they are paid.
Five year summaries 58
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Consolidated balance sheet
at 30 September 2004 to 2008
  30 September 30 September 30 September 30 September 30 September 
  2008 2007 2006 2005 2004 
  £’000 £’000 £’000 £’000 £’000
Assets      
Non-current assets      
Intangible assets  2,058 2,122 2,120 2,133 2,172
Property, plant and equipment  5,315 5,208 3,737 2,494 2,155
Trade and other receivables  210 194 — — —
  7,583 7,524 5,857 4,627 4,327
Current assets      
Short term property investment  — — — — 75
Inventories  2,496 1,828 1,706 1,201 1,084
Trade and other receivables  3,039 2,767 2,852 2,641 1,873
Cash and short term deposits  1,260 317 931 810 1,171
  6,795 4,912 5,489 4,652 4,203
Total assets  14,378 12,436 11,346 9,279 8,530
Equity and liabilities      
Current liabilities      
Trade and other payables  1,480 1,376 1,167 1,154 818
Financial liabilities  1,182 621 653 233 224
Accruals and deferred income  533 399 466 253 504
T axation liabilities  341 — 28 238 23
  3,536 2,396 2,314 1,878 1,569
Non-current liabilities      
Financial liabilities  1,088 1,340 658 161 394
Deferred tax liabilities  817 479 266 239 172
Government grants  55 — — — —
  1,960 1,819 924 400 566
Total liabilities  5,496 4,215 3,238 2,278 2,135
Net assets  8,882 8,221 8,108 7,001 6,395
Capital and reserves      
Equity share capital  147 147 146 143 143
Share premium  6,479 6,473 6,450 6,215 6,212
Revenue reserve   2,256 1,601 1,512 643 40
Total equity  8,882 8,221 8,108 7,001 6,395
The results for the years ended 30 September 2006 to 2008 are presented under IFRS whilst the results for the years ended 
30 September 2004 and 2005 are presented under UK GAAP .
Five year summaries
continued 59
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
The Directors are responsible for preparing the annual report and financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected 
to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom 
Accounting Standards and applicable law). These financial statements are required by law to give a true and fair view of the state of 
affairs of the Company and of the profit or loss of the Company for that period. In preparing those financial statements, the Directors 
are required to:
I select suitable accounting policies and then apply them consistently;
I make judgements and estimates that are reasonable and prudent;
I  state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained 
in the financial statements; and
I  prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue 
in business.
The Directors are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial 
position of the Company and to enable them to ensure that the financial statements comply with the Companies Act 1985. They are 
also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection 
of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s 
website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation 
in other jurisdictions.
The Directors confirm that the financial statements comply with the above requirements.
Statement of Directors’ responsibilities in relation 
to the Parent Company financial statements 60
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Independent auditors’ report to the members of Zytronic plc
We have audited the Parent Company financial statements of Zytronic plc for the year ended 30 September 2008 which comprise 
the Company balance sheet and the related notes 1 to 13. These Parent Company financial statements have been prepared under 
the accounting policies set out therein.
We have reported separately on the Group financial statements of Zytronic plc for the year ended 30 September 2008.
This report is made solely to the Company’s members, as a body, in accordance with Section 235 of the Companies Act 1985. 
Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to 
them in an auditors’ report and for no other purpose. T o the fullest extent permitted by law, we do not accept or assume responsibility 
to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions we 
have formed.
Respective responsibilities of Directors and auditors
The Directors’ responsibilities for preparing the Annual Report and Parent Company financial statements in accordance with applicable 
United Kingdom law and Accounting Standards (United Kingdom Generally Accepted Accounting Practice) are set out in the Statement 
of Directors’ Responsibilities.
Our responsibility is to audit the Parent Company financial statements in accordance with relevant legal and regulatory requirements and 
International Standards on Auditing (UK and Ireland).
We report to you our opinion as to whether the Parent Company financial statements give a true and fair view and are properly 
prepared in accordance with the Companies Act 1985. We also report to you whether in our opinion the information given in the 
Directors’ report is consistent with the Parent Company financial statements. The information given in the Directors’ report includes 
that specific information presented in the Chairman’s statement, Chief Executive’s review and Financial review that is cross referred 
from the Business review section of the Directors’ report.
In addition we report to you if, in our opinion, the Company has not kept proper accounting records, if we have not received all the 
information and explanations we require for our audit, or if information specified by law regarding Directors’ remuneration and other 
transactions is not disclosed.
We read other information contained in the annual report and consider whether it is consistent with the audited Parent Company 
financial statements. The other information comprises the Corporate statement; Highlights; Our markets, at a glance; What we do, 
at a glance; Directors; Corporate information; Corporate governance; Remuneration report; Five year summaries; and Notice of 
Annual General Meeting. We consider the implications for our report if we become aware of any apparent misstatements or material 
inconsistencies with the Parent Company financial statements. Our responsibilities do not extend to any other information. 
Basis of audit opinion
We conducted our audit in accordance with International Standards on Auditing (UK and Ireland) issued by the Auditing Practices 
Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the Parent Company 
financial statements. It also includes an assessment of the significant estimates and judgements made by the Directors in the 
preparation of the Parent Company financial statements, and of whether the accounting policies are appropriate to the Company’s 
circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to 
provide us with sufficient evidence to give reasonable assurance that the Parent Company financial statements are free from material 
misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of 
the presentation of information in the Parent Company financial statements.
Opinion
In our opinion:
I  the Parent Company financial statements give a true and fair view, in accordance with United Kingdom Generally Accepted 
Accounting Practice, of the state of the Company’s affairs as at 30 September 2008;
I the Parent Company financial statements have been properly prepared in accordance with the Companies Act 1985; and 
I the information given in the Directors’ report is consistent with the Parent Company financial statements.
Ernst & Young LLP
Registered auditor
Newcastle-upon-Tyne
19 December 2008 
Notes:
1.  The maintenance and integrity of the Zytronic plc web site is the responsibility of the Directors; the work carried out by the auditors 
does not involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that may 
have occurred to the financial statements since they were initially presented on the web site.
Parent Company auditors’ report 61
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
2.  Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation 
in other jurisdictions.
     30 September 30 September  
     2008 2007 
    Notes £’000 £’000
Fixed assets    
T angible assets    3 1,543 1,461
Investments    4 9,448 9,448
     10,991 10,909
Current assets    
Debtors    
– amounts falling due within one year    5 1,290 1,550
– amounts falling due after one year    5 4,000 4,000
Cash at bank and in hand     332 268
     5,622 5,818
Creditors: amounts falling due within one year    6 265 202
Net current assets     5,357 5,616
Total assets less current liabilities     16,348 16,525
Creditors: amounts falling due after more than one year    7 529 591
Provisions for liabilities and charges    
Deferred tax    9 51 27
     15,768 15,907
Capital and reserves      
Called up share capital    10 147 147
Share premium    11 6,479 6,473
Profit and loss account    11 9,142 9,287
Shareholders’ funds     15,768 15,907
These financial statements have been approved by the Board of Directors on 3 December 2008 and signed on their behalf by:
John M Kennair MBE D G W Mullan, B.Sc., FCA
Chairman Finance Director
19 December 2008 
Parent Company balance sheet
at 30 September 2008 62
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
1. Accounting policies
(a) Basis of preparation
The financial statements of Zytronic plc were approved for issue by the Board of Directors on 19 December 2008. The financial statements 
are prepared under the historical cost convention and in accordance with applicable accounting standards.
No profit and loss account is presented for the Company as permitted by Section 230 of the Companies Act 1985 and the Company 
has taken the exemptions under IFRS 1 to not present a cashflow statement.
The Company has taken advantage of the exemption available to parent companies under FRS 29 Financial Instruments: Disclosures 
so as not to provide the information otherwise required by the standard, as the Group’s consolidated financial statements, in which the 
Company is included, provide equivalent disclosures under IFRS 7 Financial Instruments and Disclosure.
(b) Revenue recognition
Rental income from tenants is recognised in the profit and loss account on a straight line basis over the term of the lease.
(c) Share-based payments
Equity-settled transactions
The cost of equity-settled transactions with employees is measured by reference to the fair value at the date at which they are 
granted and is recognised as an expense over the vesting period, which ends on the date on which the relevant employees become 
fully entitled to the award. Fair value is determined using an appropriate pricing model. In valuing equity-settled transactions, no account 
is taken of any vesting conditions, other than conditions linked to the price of the shares of the Company (market conditions).
No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market 
condition, which are treated as vesting irrespective of whether or not the market condition is satisfied, provided that all other 
performance conditions are satisfied.
At each balance sheet date before vesting, the cumulative expense is calculated, representing the extent to which the vesting period 
has expired and management’s best estimate of the achievement or otherwise of non-market conditions and the number of equity 
instruments that will ultimately vest, or in the case of an instrument subject to a market condition, be treated as vesting as described 
above. The movement in cumulative expense since the previous balance sheet date is recognised in the income statement, with a 
corresponding entry in equity.
Where the terms of an equity-settled award are modified or a new award is designated as replacing a cancelled or settled award, 
the cost based on the original award terms continues to be recognised over the original vesting period. In addition, an expense is 
recognised over the remainder of the new vesting period for the incremental fair value of any modification, based on the difference 
between the fair value of the original award and the fair value of the modified award, both as measured on the date of the modification. 
No reduction is recognised if this difference is negative.
Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any cost not yet recognised 
in the profit and loss account for the award is expensed immediately. Any compensation paid up to the fair value of the award at the 
cancellation or settlement date is deducted from equity, with any excess over fair value being treated as an expense in the profit and 
loss account.
The Company has taken advantage of the transitional provisions of FRS 20 in respect of equity-settled awards so as to apply FRS 20 
only to those equity-settled awards granted after 7 November 2002 that had not vested before 1 October 2006.
For awards granted before 7 November 2002, the Company recognises only the intrinsic value or cost of these potential awards 
as an expense. This is accrued over the performance period of each plan based on the intrinsic value of the equity-settled awards.
(d) Property , plant and machinery
Property, plant and machinery is stated at cost less accumulated depreciation and accumulated impairment losses. Such cost includes 
costs directly attributable to making the asset capable of operating as intended. Borrowing costs attributable to assets under 
construction are recognised as an expense when incurred.
Depreciation is provided on all tangible fixed assets, at rates calculated to write off the costs, less estimated residual value, of each 
asset evenly over its expected useful life, as follows:
Freehold land – Nil 
Freehold property – 50 years 
Short leasehold property – over the term of the lease 
Plant and machinery – varying rates between 5% and 25% per annum
The carrying values of tangible fixed assets are reviewed for impairment when events or changes in circumstances indicate the carrying 
value may not be recoverable. The expected useful lives of assets are reviewed annually. 
Notes to the Parent Company financial statements
for the year ended 30 September 2008 63
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
1. Accounting policies (continued)
(e) Deferred taxation
The charge for taxation is based on the profit for the year and takes into account taxation deferred because of timing differences between 
the treatment of certain items for taxation and accounting purposes.
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where 
transactions or events that result in an obligation to pay more, or a right to pay less, tax in the future have occurred at the balance sheet 
date, with the exception of deferred tax assets which are recognised only to the extent that the Directors consider that it is more likely 
than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted.
Deferred tax is measured on a non-discounted basis at the tax rates that are expected to apply in the periods in which timing 
differences reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date.
(f) Interest-bearing loans and borrowings
All interest-bearing loans and borrowings are initially recognised at net proceeds, being fair value of the consideration received net 
of issue costs associated with the borrowings. Finance costs (including issue costs) are taken to the profit and loss account over the 
term of the debt at a constant rate on the balance sheet carrying amount. The carrying amount is increased by the finance charges 
amortised and reduced by payments made in respect of the accounting period. 
(g) Pensions
The Company is a member of a group personal pension scheme which is a defined contribution scheme. Contributions are charged 
to the profit and loss account as they become payable in accordance with the rules of the scheme.
2. Auditors’ remuneration
Auditors’ remuneration for the year ended 30 September 2008 was £34,000 (2007: £20,700).
3. Tangible fixed assets
     Freehold  
    Land property T otal 
     £’000 £’000  £’000
Cost:       
At 30 September 2007    100 1,388 1,488
Additions    — 111 111
At 30 September 2008    100 1,499 1,599
Depreciation:      
At 30 September 2007    — 27 27
Provided during the year    — 29 29
At 30 September 2008    — 56 56
Net book value at 30 September 2008    100 1,443 1,543
Net book value at 30 September 2007    100 1,361 1,461 4. Investments
Investments in subsidiary companies
     2008 2007 
     £’000 £’000
Shares in subsidiary companies:      
At beginning and end of year     9,448 9,448
Details of the investments in which the Company holds 20% or more of the nominal value of any class of share capital are as follows:
    Proportion of 
    voting rights and Nature of  
Name of Company   Holding shares held business
Zytronic Displays Limited   Ordinary shares 100% Manufacture of  
     transparent composites,  
     including touch sensors 
Intasolve Limited   Ordinary shares 100% Dormant
Zytronic Glass Products Limited   Ordinary shares 100% Dormant
The trading subsidiary is incorporated in England.
5. Debtors
     2008 2007 
     £’000 £’000
Trade debtors     9 —
Amounts owed by Group undertakings     5,273 5,508
Prepayments and accrued income     8 42
     5,290 5,550
Amounts falling due after more than one year included above are:
     2008 2007 
     £’000 £’000
Amounts owed by Group undertakings     4,000 4,000
6. Creditors: amounts falling due within one year
     2008 2007 
     £’000 £’000
Bank loan (note 8)     64 63
Trade creditors     11 8
Other taxes and social security costs     — 9
Other creditors and accruals     109 41
Other amounts owed to subsidiary undertakings     81 81
     265 202
64
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Notes to the Parent Company financial statements
for the year ended 30 September 2008 continued 65
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
7. Creditors: amounts falling due after more than one year
     2008 2007 
     £’000 £’000
Bank loan (note 8)     529 591
8. Bank loan
On 13 January 2006, Zytronic plc drew down funds under a ten year mortgage with Lloyds TSB Bank plc under which it borrowed 
£750,000, repayable by monthly instalments. The loan is secured against its freehold interest in Britannia Court, the adjoining factory 
premises which it acquired in January 2006. Interest is payable at 1.25% above that bank’s base rate.
9. Deferred taxation liability
The deferred tax included in the balance sheet is as follows:
     2008 2007 
     £’000 £’000
Accelerated capital allowances     43 27
Other timing differences     8 —
     51 27
At 1 October     27 —
Charged in the profit and loss account     24 27
At 30 September     51 27
10. Share capital and share-based payments
(a) Share capital
   2008 2007   
   Number Number 2008 2007 
   Thousands Thousands £’000 £’000
Authorised:      
Ordinary shares of 1p each   25,000 25,000 250 250
Allotted, called up and fully paid:      
Ordinary shares 1p each   14,674 14,662 147 147
Note 21(a) in the Group accounts sets out the details of the share option schemes of the Group and the numbers of shares in the 
Parent Company which are contingently exercisable under them.
(b) Share-based payments
Note 21(b), share-based payments, in the Group accounts goes on to identify the bonus of the Senior Executive Plan, the All Employee 
Share-option Plan, and the Sharesave Scheme. It also contains a table which illustrates the number and weighted average exercise 
prices of, and movements in, share options during the year.
(c) Directors’ share incentive scheme
Note 21(c) in the Group accounts sets out the details of the share incentive award scheme for Mark Cambridge, Chief Executive, 
in shares of the Parent Company. 66
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Notes to the Parent Company financial statements
for the year ended 30 September 2008 continued
11. Reconciliation of movements in shareholders’ funds
   Called  Profit  
   up share Share and loss  
   capital  premium account T otal 
   £’000 £’000 £’000 £’000
At 30 September 2007   147 6,473 9,287 15,907
Exercise of share options   — 6 — 6
Profit on ordinary activities after taxation   — — 293 293
Share-based payments   — — 2 2
Dividends   — — (440) (440)
At 30 September 2008   147 6,479 9,142 15,768
A profit of £293,000 (2007: £452,000), before payments of dividends of £440,000 (2007: £439,000), has been dealt with in the 
financial statements of the Company which, under the exemption contained in Section 230 of the Companies Act 1985, has not 
presented its own profit and loss account.
Included in the Company’s opening and closing profit and loss account reserves is an amount of £8,919,000 which was a dividend 
received from a subsidiary company in a prior year. This is not included in Group reserves and does not form part of the Company’s 
distributable reserves.
12. Pension scheme commitments
Contributions for the year to 30 September 2008 amounted to £2,500 (2007: £2,300) and the outstanding contributions at the 
balance sheet date were £1,200 (2007: £4,300).
13. Guarantees
Zytronic plc has given guarantees, regarding funding advanced to Zytronic Displays Limited, to Yorkshire Bank in connection with a 
bank loan and HP agreements detailed in notes (a) and (b) and to Lloyds TSB Bank plc in connection with an overdraft facility and 
a revolving credit facility detailed in note (c) below.
(a) Chattel Mortgage
On 28 September 2004, Zytronic Displays Limited entered into a term loan with Yorkshire Bank which is secured by a chattel mortgage 
over certain items of plant and machinery. Interest is payable at 1% above that bank’s base rate. The original loan of £250,000, repayable 
in 36 equal monthly instalments was paid off in November 2007. On 23 November 2007, an additional amount of £100,000 was 
borrowed under the terms of the same chattel mortgage, again repayable by 36 equal monthly instalments.
(b) HP agreements
In September 2007, Zytronic Displays Limited put in place six HP agreements with Yorkshire Bank. These agreements provide 
longer term funding for some of the significant capital expenditure incurred in the refurbishment of Britannia Court and its equipping 
as a manufacturing facility for ZYPOS, and other, touch sensors. The net amounts advanced under those HP agreements total 
£1.123m and the term of each is three years. In the year ended 30 September 2008, a further four HP agreements were put in place 
with Yorkshire Bank to provide the final funding for equipping the new manufacturing facility. These agreements total £0.338m and 
are also repayable over three years.
(c) Borrowing facilities
The Group has an unsecured overdraft facility of £1.5m arranged with its principal banker, Lloyds TSB Bank plc. This facility extends 
until 31 March 2009. This facility is to provide funding for working capital. On 25 October 2007, the Group entered into an additional 
facility with Lloyds TSB Bank plc, being a revolving credit facility for £2.0m, which extends until 30 June 2010. This facility is to provide 
additional working capital and funding for capital expenditure, should it be required. Annual report and financial statements 2008 www.zytronic.co.uk
Notice of annual general meeting
Notice is hereby given that the Annual General Meeting of the Company will be held at the Company’s registered office at Whiteley Road, 
Blaydon-on-Tyne, Tyne & Wear NE21 5NJ on 19 February 2009 at 2.00pm for the following purposes:
Ordinary business
T o consider and, if thought fit, to pass the following resolutions as ordinary resolutions of the Company:
1. T o receive the financial statements for the year ended 30 September 2008 and the reports of the Directors and auditors thereon.
2.  T o pay a final dividend of 3.0p per ordinary share of 1.0p for the year ended 30 September 2008 on 9 March 2009 to members 
on the Register at the close of business on 20 February 2009.
3. T o re-elect Denis G W Mullan as a Director.
4. T o re-elect Tudor G Davies as a Director.
5. T o re-appoint Ernst & Young LLP as auditors and to authorise the Directors to fix their remuneration.
Special business
T o consider and, if thought fit, to pass the following resolutions as special resolutions of the Company:
1.  The Directors of the Company be and are hereby generally and unconditionally authorised (in substitution for any previous authority) 
for the purposes of Section 80 of the Companies Act 1985 (as amended) (the “ Act”) to exercise all the powers of the Company to 
allot relevant securities (as defined in Section 80(2) of the Act) on such terms and in such manner as they shall think fit, up to an 
aggregate nominal value equal to £48,913.74 at any time (unless and to the extent previously revoked, varied or renewed by the 
Company in general meeting) during the period from the date hereof until the conclusion of the Company’s Annual General Meeting 
held in 2010 provided that the Directors of the Company may make an offer or enter into an agreement which would or might require 
relevant securities to be allotted after the expiry of such authority and the Directors may allot relevant securities after such expiry under 
this authority in pursuance of any such offer or agreement as if this authority had not expired. The authority hereby given may at any 
time (subject to the provisions of Section 80 of the Act) be renewed, revoked or varied by ordinary resolution of the Company in 
general meeting.
2.  The Directors of the Company be given power pursuant to Section 95 of the Act to allot equity securities (as defined in Section 94 
of the Act) for cash pursuant to the Section 80 authority, referred to above in resolution 1, as if Section 89(1) of the Act did not apply 
to any such allotment, such power to expire at the conclusion of the Company’s Annual General Meeting held in 2010 or, if earlier, 
the revocation of the Section 80 authority referred to above provided that before such expiry the Directors of the Company may make 
an offer or enter into an agreement which would or might require equity securities to be allotted after the expiry of such power and 
the Directors may allot equity securities after such expiry under this power in pursuance of any such offer or agreement as if this 
power had not expired. The power is limited to:
 2.1  the allotment of equity securities for cash in connection with a rights issue to holders of ordinary shares of 1.0p each where 
the equity securities respectively attributable to the interests of such holders are proportionate (as nearly as may be practicable) 
to the respective numbers of ordinary shares of 1.0p each held by them but subject to such exclusions or other arrangements 
as the Directors may deem necessary or expedient to deal with any fractional entitlements or any legal or practical problems 
under the laws of, or the requirements of any regulatory body or any recognised stock exchange in, any territory; and
 2.2  the allotment (other than pursuant to 2.1 of this special resolution) of equity securities up to a maximum aggregate nominal 
amount of £14,674.12.
  This power applies in relation to any sale of shares which is an allotment of equity securities by virtue of Section 94(3A) of the Act 
as if in the first paragraph of this resolution the words “pursuant to the Section 80 authority, referred to above in resolution 1,” 
were omitted.
67
Zytronic plc 68
Zytronic plc Annual report and financial statements 2008 www.zytronic.co.uk
Notice of annual general meeting
continued
Special business (continued)
3.  That the Company be and is hereby generally and unconditionally authorised in accordance with Section 166 of the Act to make 
market purchases (within the meaning of Section 163 of the Act) of ordinary shares of 1.0p each in the capital of the Company 
(“Shares”) provided that:
 3.1 the maximum number of Shares hereby authorised to be purchased shall be 1,467,412; 
 3.2 the minimum price which may be paid for a Share shall be 1.0p; 
 3.3  the maximum price which may be paid for a Share shall be not more than 5% above the average of the middle market 
quotations for Shares on AIM for the five business days immediately preceding the date of the purchase of the Share; and
 3.4  unless previously varied, revoked or renewed, the authority hereby conferred shall expire at the conclusion of the Company’s 
Annual General Meeting held in 2010 save that the Company may, prior to such expiry, enter into a contract to purchase 
Shares which will or may be executed wholly or partly after such expiry and purchase Shares pursuant to such contract;
  and that all Shares so purchased in pursuance of this authority shall be held as Treasury Shares (as defined by Section 162A 
of the Act) for future resale for cash; transfer for the purposes of an employees’ share scheme; or for cancellation.
By order of the Board
D G W Mullan, B.Sc, FCA
Company Secretary
Zytronic plc
Whiteley Road
Blaydon-on-Tyne
Tyne & Wear NE21 5NJ
19 December 2008
Notes:
1.  Every member entitled to attend and vote at the meeting may appoint a proxy or proxies to attend and on a poll vote on their behalf. 
A proxy need not be a member of the Company. A prepaid form of proxy is enclosed. Completed forms of proxy must be returned 
to the Company’s Registrars at the address shown on the form of proxy not less than 48 hours before the time appointed for the 
holding of the meeting. The sending of a completed form of proxy to the Company’s Registrars will not preclude members from 
attending and voting at the meeting, or any adjournment thereof, in person, should they so wish.
2.  The Company, pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001, specifies that only those holders 
of ordinary shares of 1.0p each of the Company registered in the Register of Members of the Company as at 2.00pm on 
17 February 2009 shall be entitled to attend or vote at the meeting in respect of the number of ordinary shares of 1.0p each 
of the Company registered in their name at that time. Changes to entries on the register of members after 2.00pm on 
17 February 2009 shall be disregarded in determining the rights of any person to attend or vote at the meeting.
3.  Copies of contracts of service between Directors and the Company or any of its subsidiary undertakings, together with the 
Register of Directors’ share interests, will be available for inspection during normal business hours by members at the registered 
office of the Company on each business day from the date of this notice until the date of the Annual General Meeting, and at the 
place of the Annual General Meeting for at least 15 minutes prior to, and during, that meeting.  Zytronic is the developer and manufacturer of 
a unique range of internationally award-winning 
touch sensor products. These products 
employ an embedded sensing element 
and are based on projected capacitive 
technology (“PCT™”). PCT offers significant 
durability, environmental stability and optical 
enhancement benefits to system designers 
of integrated electronic displays, beyond 
that which was previously attainable.
Zytronic is also an industry leader in the 
development and manufacture of customised 
optical filters to enhance electronic display 
performance and an innovator in the production 
of specialised and transparent laminates for 
niche markets.
Operating from three modern factories near 
Newcastle-upon-T yne in the United Kingdom, 
Zytronic assembles touch sensors, optical 
filters and other laminates, using special 
glass and plastic materials, in environmentally 
controlled clean rooms.
 1 Highlights
 2 Chairman’s statement
 4 Our markets, at a glance
 6 What we do, at a glance
 8 Chief Executive’s review
 12 Financial review
 15 Directors
 16 Corporate information
 17 Directors’ report 
 20 Corporate governance
 23 Remuneration report
 27 Independent auditors’ report 
 28 Consolidated income statement 
 28  Consolidated statement of recognised 
income and expense
 29 Consolidated balance sheet
 30	 Consolidated	cashflow	statement
 31	 Notes	to	the	financial	statements	
 57 Five year summaries
 59  Statement of Directors’ responsibilities in relation 
to	the	P arent	Company	financial	statements
 60 Parent Company auditors’ report
 61 Parent Company balance sheet
 62	 Notes	to	the	P arent	Company	financial	statements
 67 Notice of annual general meeting
Corporate statement Leading  
in a global 
market
Zytronic plc 
Annual report and financial statements 2008
Zytronic plc
Whiteley Road 
Blaydon-on-Tyne 
Tyne & Wear NE21 5NJ 
T el:  0191 414 5511 
Fax:  0191 414 0545 
Email: info@zytronic.co.uk 
Web:  www.zytronic.co.uk
Zytronic plc Annual report and financial statements 2008