2011/2012 
ANNUAL REPORT AND ACCOUNTS
Innovating SaaS Technology  
and Tools for Marketers Contents 
Business Summary   1
Key Highlights 2
Chairman ‘s Statement 4
Chief Executive Report 5
Corporate Social Responsibility 18
Our Board of Directors 20
Corporate Governance Report 22
Audit Committee Report 23
Remuneration committee report 24
Report of the Directors    26
Report of the Independent Auditors    31
 
Consolidated Income Statement    32
Consolidated Statement of Comprehensive Income   32
Consolidated Statement of Financial Position   33
Company Statement of Financial Position   34
Consolidated Statement of Changes in Equity   35
Company Statement of Changes in Equity   36
Consolidated Statement of Cash Flows    37
Company Statement of Cash Flows 37
Notes to the Consolidated Financial Statements   38
Company Information    IBC 
Empowering clients to punch above their weight by providing  
the world’s best digital marketing products.
OUR MISSION 
OUR VALUES 
Professional,  
expert and fun
Fast-paced but 
quality driven
Creative and  
geeky with the 
human touch
Corporate  
but cool
Approachable, 
sociable, 
welcoming and 
client-centric
Business-like, 
entrepreneurial  
but still a family
Passionate  
 about our  
client/supplier 
partnerships 
Motivated, 
inspirational, 
innovative and 
accomplished
Awesome  
is the required 
standard
Committed  
to giving back  
to staff and  
society
An unhidden  
agenda about  
clients success
Easy to use  
space-age 
technologies dotDigital Group Plc, are a leading provider of intuitive Software 
as a Service (“SaaS”) technology and managed services to digital 
marketing professionals.
Our aim is to develop easy-to-use and visual SaaS marketing  
tools, for non-technical and non-creative users, that deliver 
smarter, quicker and easier design, creation and execution of 
campaign workflows across every digital channel, while enabling 
the use of marketing best practices and management controls.
BUSINESS SUMMARY
dotMailer 
dotMailer is a powerful email and 
cross-channel marketing automation 
platform with easy-to-use tools 
that enable large coporations and 
SME marketers to eﬃciently create, 
manage, execute and evaluate 
eﬀective targeted campaigns.
dotSurvey 
dotSurvey is a versatile and easy-to-
use online survey tool that enables 
users to create, manage and execute 
fully branded interactive surveys, 
competitions and web forms to 
capture and evaluate data.
dotAgency 
dotAgency provides digital solutions 
and search marketing services to  
large corporations and brands. 
dotAgency take a strategic approach 
to UX, web development and 
digital marketing to achieve clients’ 
commercial objectives.
dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
Ecommerce Web Design & Search Marketing
1
Innovating SaaS Technology  
and Tools for Marketers
Versatile, powerful & 
easy-to-use Survey tool
Powerful and easy-to-use Email & Cross-
Channel Marketing Automation Platform www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
2
Continued strong  
cash generation with  
cash balances of  
£4m  
at year end
+25% 
increase in profit before  
tax and exceptionals
to £2.9m
+31% 
increase in EBITDA
to £3.4m
+34% 
increase in turnover  
to £12m
Key Highlights 
2011/12
Visit dotDigital Group Plc’s 
website for latest  
information and news.  dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
3
dotMailer continues  
to be a significant source  
of revenue growth in the  
year with 1,813  new clients 
being added and increased 
‘corporate’ client wins 
Continued  investment 
in upgrading of our IT 
infrastructure and further 
significant product  
development
dotSurvey the new online 
survey tool only launched 
in May now has over 500 
paying clients and nearly 
2,500 trial users
Early results from 
international expansion 
are encouraging with the 
international sales team 
being progressively built 
over the next year
Strengthening of  
the senior operational 
management team
Clients in  
1 56  
countries
1,813 
client wins including DHL, 
Nationwide, BBC Worldwide, 
Capita, Astra Zeneca, Esso, 
Ryman, Tarmac, Nicole Farhi, 
Nicky Clarke, EDF Energy, 
Virgin Train and Betfair www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
4
We see our market moving toward 
providing multi-channel marketing 
automation solutions.
CHAIRMAN’S STATEMENT
Dear Shareholder
I am pleased to report that despite the general economic climate 
dotDigital has increased sales and proﬁtability before exceptionals  
in the past year. This continued strong performance is a testament to 
the quality of the Company’s business model with a strong emphasis 
on recurring revenue, cash generation and cost management.
I recognise that an eﬀective board is central to the long-term 
sustainable success of the Company. We have worked hard to cultivate 
a strong team spirit through the on going review of the role and 
eﬀectiveness of the Board combined with regular strategy reviews. 
One of our non-Executive Directors, Nicholas Nelson, left the Board  
on 5th January 2012 and I would like to thank Nicholas for his valuable 
contribution to the business. It is my intention to appoint another  
non-Executive Director in the coming ﬁnancial year.  
Since joining the Company I have got to know many of our 
employees and have been repeatedly impressed by their enthusiasm, 
professionalism and dedication at every level of the organisation.  
On behalf of all our stakeholders, I thank our employees for their  
hard working contribution to another successful year.
I would also like to thank the Executive Management team for  
their continued commitment, hard work and passion in developing 
the business.
We are ﬁrmly committed to organic growth and we see a number 
of areas where we can develop our business. In the coming year we 
plan to increase our focus on geographic expansion, with particular 
emphasis on building our client list of larger businesses, by satisfying 
their demand for eﬀective marketing automation solutions. We will 
continue to assess acquisition opportunities but only act when the 
Board believes acquisition represents excellent value. 
We continue to innovate and develop products that stand out from 
the competition and the change in strategic focus on selling to larger 
enterprise organisations is starting to show excellent results.
Looking at the wider global situation, we see our market moving 
towards providing multi-channel marketing automation solutions and 
we believe our platform is well-positioned to compete in this space.
To conclude: as you will read in this Annual Report, dotDigital is in very 
good shape and continues to make great progress in delivering value 
to its shareholders and other stakeholders. The drivers of the business 
remain ﬁrmly in place. Despite current economic uncertainties, I am 
conﬁdent that we will continue to beneﬁt in the years ahead from 
continued investment in our technology, our emphasis on the quality 
of our people and eﬀective management of our costs.
                 
Frank Beechinor-Collins
Chairman
dotDigital is in very  
good shape and 
continues to make great 
progress in delivering 
value to its shareholders 
and other stakeholders. 5
dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
Financial Overview
The Group has enjoyed another year of proﬁtable growth with  
the ﬁnal outcome for revenue and proﬁts slightly ahead of analysts’ 
expectations.
Turnover increased from £9m to £12m, a growth of 34% in the year  
and proﬁt before tax and exceptional items grew from £2.3m to £2.9m 
a growth of 25%.
Overall the Board is delighted with the progress made against plans 
during the year, which reﬂect our continued focus on strong organic 
growth through new client acquisitions and investment in new 
products and services.
We have again focused on growing recurring revenues and 
proﬁtability, while continuing to invest in people and product 
development to maintain future earnings. The total investment in 
hardware during the year was £0.3m and £1.1m in product research 
and development.
CHIEF EXECUTIVE’S REPORT
We will continue to focus on product 
innovation, understanding our clients’ 
requirements and delivering return on 
investment for our clients.
Turnover and 
profits ahead 
of market 
expectations
Continued 
strong cash 
generation
 Year end Year end  Year end 
 30.6.12 30.6.11 % inc 30.6.10 
 £m £m  £m
Turnover 12.0 9.0 34% 6.0
Pre-tax proﬁts* 2.9 2.3 25% 1.4
EBITDA 3.4 2.6 31% 1.5
*Before exceptional items
Cash Position
We continue to be strongly cash generative with cash from operations 
growing in the year and cash balances at the year-end reaching £4m. 
Other than small operating leases there is no debt ﬁnance.
We have continued to invest in the future of the business with 
signiﬁcant investment in upgrading the IT infrastructure and further 
signiﬁcant product development. 
Growth Strategy
By business unit the growth has been as follows:
SaaS Email Marketing Revenues & Email Managed Service from  
£6.9m to £9.5m – up 38%.
Services & Search from £2.1m to £2.5m – up 19%.
Watch Proactive Investors 
Interview of dotDigital 
Group’s CEO, Peter Simmonds.
Peter Simmonds
Chief Executive and  and Chief Financial Officer www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
6
CHIEF EXECUTIVE’S REPORT CONTINUED
Digital Landscape
Current research shows that companies are continuing to shift  
money from traditional marketing to internet marketing for its 
eﬀectiveness and ability to attribute results to speciﬁc activity, 
demonstrating improved ROI.
The signiﬁcant increase in time being spent consuming online  
media has had a direct impact on marketing spend. A 6% drop in  
time spent consuming print media has seen a 29% drop in advertising 
spend, where as internet has a signiﬁcant 16% growth in time spent 
consuming media with an ad spend growth of 22%.
We believe, it is the email’s value within the context of broader 
personalised marketing programs that is bringing new value to the 
channel. Although unveriﬁed, sources estimate 2.9 billion email 
accounts and over 100 billion subscribed email messages are being 
sent daily. Email’s reach is unmatched despite the rapid adoption  
of alternative channels for engaging consumers online. Despite  
the attention and reports surrounding social media marginalising 
email, it remains the most logical centre for any multi-channel 
marketing platform.
As this trend persists the Board will continue to work with UK and 
international partners to identify and evaluate emerging opportunities 
for SaaS technology products across email and cross-channel online 
marketing to inform its product roadmap.
Companies are  
continuing to shift money 
from traditional marketing 
to internet marketing for its 
effectiveness and ability  
to attribute results to 
specific activity.
Multi-channel marketing is becoming 
one of the most sought-after categories 
in enterprise software/service. 7
dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
Email
2.9bn
accounts
100bn+ daily 
messages
Facebook
845m
active monthly users
2.7bn likes & 
comments/day
Twitter
300m
accounts
300m tweets/day
Google
95m
accounts
Tumblr
48m
blog accounts
Instagram
27m
accounts
Foursquare
15m
accounts
Pinterest
11m
monthly visitors
Multi-Channel Marketing
Traditional CRM
Customer data store
CRM system will play an 
important role in powering user 
level marketing campaigns
Email Marketing
Management
Email creation and management
system driven by need to manage 
user interactions and messages 
across digital channels
Social Media
Management
Engagement system for social 
consumer interaction
Social software leading
convergence between earning,
owned and paid channels
Email’s global reach is still unmatched despite the rapid  
adoption of alternative channels for engaging consumers
Multi-channel marketing is becoming one of the most-sought  
after categories in enterprise marketing software/service www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
8
CHIEF EXECUTIVE’S REPORT CONTINUED
dotMailer
Email marketing continues to perform extremely strongly both in 
terms of new clients and recurring revenues from existing clients, with 
dotMailer’s monthly recurring revenue now accounting for over 60% 
of total revenue across the Company, which equates to approximately 
38% growth year-on-year. The Group’s total recurring revenue from all 
products and services, now accounts for 67% of total revenue.
New customer signups for dotMailer have continued to be a signiﬁcant 
source of revenue growth in the year, with 1,813 new clients being 
added. Of particular note during 2011/12, is that enhancements to 
the dotMailer platform and changes to the structure of the sales team 
have signiﬁcantly increased client wins in the ‘corporate’ segment. 
Our portfolio of blue chip clients now includes names such as DHL, 
Nationwide, BBC Worldwide, Capita, AstraZeneca, Esso, Ryman, Tarmac, 
Nicole Farhi, Nicky Clarke, EDF Energy, Virgin Train and Betfair. 
Based on historic experience the lifetime value of a corporate client 
should be in excess of £40k compared to an average lifetime value  
of £4k for a SME client.
The combination of ﬂexible pricing options, ease-of-use and advanced 
marketing features enables us to win clients from SME’s to global 
corporates. Moving forward we see growth opportunities in the mid 
– large company requiring a self service provider – a niche where we 
believe dotMailer can dominate.
Email & Cross-Channel
Marketing Automation
dotMailer client portfolio includes:
User interfaces now have the ability 
to be translated into eight languages 
to support international client and 
partner growth plans.
Watch dotMailer’s email Drag 
& Drop Easy Editor video
+38%
growth in SaaS Email 
Marketing Revenues  
& Email Managed  
Service. 9
dotMailer software provides users with an efficient and 
effective marketing campaign management system with a 
suite of interactive, powerful and easy-to-use email and cross-
channel marketing tools. Bought separately, or as part of a 
comprehensive cross-channel solution, email, mobile, social, 
landing page, ecommerce and survey tools can be managed  
from a single point running on dotMailer’s highly secure and 
robust platform and infrastructure.
Small business or corporate enterprise users can create, manage, 
automate and analyse integrated digital maketing activity more 
efficiently and effectively to significantly improve their customer 
lead generation, conversion, and retention.
Using dotMailer’s email Drag & Drop 
Easy Editor and powerful administration 
and reporting features, users can easily 
create, manage and evaluate segmented 
email campaigns to drive conversion, 
retention and loyalty.
Businesses can manage and moderate 
social media marketing from one central 
hub, getting involved with fans in  
their space to build brand reputation  
and personality.
Shop builder makes it easy for small 
businesses to build and manage a successful 
ecommerce store, allowing users to get 
selling straight away with this quick shop 
and focus on sales, not the technical side  
of web design.
Marketers can communicate effectively in 
a mobile world with easy SMS tools and 
mobile-optimised templates, allowing 
customer engagement anywhere at any 
time to drive instant responses and actions 
for maximum ROI.
Non-technical professionals can easily 
build microsites and landing pages  
so campaigns convert more, ensuring 
fully integrated campaigns by  
creating dedicated landing pages  
for each offering.
Marketers can create branded surveys, 
questionnaires, competitions and web 
forms in moments, enhancing databases 
and easily discovering more about 
customers, markets or employees.
Hello
Bonjour
Guten Tag
Interface 
image
Powerful integrations creating new sales channels
Uniquely scalable, powerful and easy-to-use 
campaign creation & management system  
for small, midsize and corporate businesses
Easy translation and white labelling technology for 
international client and partner growth
New responsive design that optimises  
campaigns for mobile
Email & Cross-Channel Marketing Automation
dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
Email
Landing Page Builder
Mobile
Shop
Social
Survey www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
10
dotSurvey
dotSurvey our new online survey tool was launched from beta at the 
beginning of May and although only marketed initially to existing 
clients has now over 500 paying clients and nearly 2,500 trial users.  
The Board recognises the enormous potential of this division as can  
be demonstrated by growth in the sector. Although marketing spend 
is crucial to the strategy of scaling this business, the Board believes  
the quality of the product will soon develop a brand to equal others  
in the market.
CHIEF EXECUTIVE’S REPORT CONTINUED
dotSurvey – perfectly branded 
online surveys, created in minutes 
with our latest online survey tool. 
Built for total usability, dotSurvey 
makes it fantastically easy for users 
to create fully branded, professional 
online surveys and web forms that 
look just like they’re part of their 
website.
Versatile, Powerful and
Easy-To-Use Online Survey Tool
dotSurvey’s client portfolio includes:
dotSurvey launched 
and marketed to 
existing client base 
in May 2012, now 
has over 500 paying 
clients and 2,500  
trial users.
Watch dotSurvey’s  
Introduction video.  11
Versatile, powerful and easy-to-use template 
creation and management system for small, midsize 
and corporate businesses
dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
With the versatility and power of dotSurvey, users can take this 
tool way beyond your average survey tool. With everything 
in the app editable and customisable, users can create highly 
professional forms, surveys, invitations, preference centres  
and much more.
dotSurvey enables users to gather 
valuable insight and feedback from 
customers, helping them to highlight 
successes and weaknesses within  
their business.
dotSurvey enables businesses to create 
website sign-up forms for visitors to 
register for more information or contact 
them. This data can be mapped into 
dotMailer to automate email campaigns.
Employees are any businesses most 
valuable asset, so carrying out regular 
satisfaction surveys with dotSurvey helps 
businesses ensure employees are happy 
and moving the business forward.
Using dotSurvey, businesses with a 
new product or idea that require initial 
customer or market feedback and 
insights can easily build, collect and 
report without any outside help.
dotSurvey allows businesses to set up 
and manage competitions to grow 
or cleanse their customer database. 
Qualifying questions are sent out and 
responses received through email, social 
media or via a website.
dotSurvey, with the power of dotMailer, 
allows businesses to manage and 
coordinate events, handling RSVPs, 
capturing special dietary requests, 
and tracking automated follow-up, 
confirmation and post-event emails.
Customer Feedback  
Contact Forms
Employee Satisfaction
Events Management
Market Research
Competitions
Uses dotMailer integration for deliverability  
  and management creating upsell opportunity
Versatile, Powerful and Easy-To-Use Online Survey Tool www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
12
Services - Agency and Search
The Agency Services and Search division, which accounts for just  
under 20% of total revenue, grew revenues in the year by 19%. 
We have appointed a new management team to head the combined 
Search and Agency team and strengthened the team in both search 
marketing and agency services.
While the growth in the Search division was behind management’s 
expectations, we believe the organisational changes which have been 
made to this business during the second half of the year will enable  
us to deliver performance in line with revised plans during 2012/13.
Early signs are that these changes are being rewarded with some 
signiﬁcantly higher-value client wins.
As a result of algorithm changes made by the major search engine 
during this period we have modiﬁed some of the search marketing 
methodologies, targeted diﬀerent client proﬁles and recruited a new 
Head of Search Strategy. During June the Sywell oﬃce was closed 
and operations were transferred to the London oﬃce to improve 
knowledge sharing and fully integrate teams. Following the move of 
the Search Marketing team to London we have merged the Agency 
Services and Search Marketing team and created an operational 
management Board to run this business unit.
The ﬁnal deferred consideration for the purchase of the search 
marketing business, dotSearch (previously Netcallidus), was made in 
November 2011. The accounts contain further non-cash IFRS3 based 
accounting adjustments in the ﬁnal accounts to unwind the impact  
of contingent consideration that was estimated on the acquisition  
in May 2009 but that was not paid to the vendors. 
CHIEF EXECUTIVE’S REPORT CONTINUED
We have appointed a new 
management team to strengthen 
and head the combined search and 
agency team.
Ecommerce Web Design
and Search Marketing
dotAgency’s client portfolio Includes: 
The agency 
services and search 
division, accounts 
for around 20% of 
total revenue. Visitors don’t stay on a website for long if it looks ugly and 
is hard to navigate. At dotAgency, we work with our clients 
to create a site that suits their brand and keeps their visitors 
coming back. Our team of strategists, designers, UX researchers, 
user interface architects and HTML and JavaScript experts work 
in collaboration to build the site. Each of our website designs is 
tailored to suit its individual purpose.
We help our clients stay ahead of the competition by buying 
real estate on well-known search engines such as Google. Paid 
search campaigns can focus on brand protection or increasing 
market share. They can use behavioural targeting and localised 
PPC, or be tactical, reactive or trend-driven. Our Google 
Analytics-certified consultants recognise patterns in your site 
data and know exactly where to look to solve the cause of 
specific problems and convert more visits into revenue. 
Creative Design Paid Search
dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
13
dotAgency provide digital solutions and search marketing 
services to large corporations and brands. dotAgency take 
a strategic approach to UX, web development and digital 
marketing to achieve our clients’ commercial objectives.
dotAgency are Magento silver-certified partners who have 
proven creative, technical and project management skills.   
We deliver superior solutions on desktop machines, mobiles  
and tablets. Our relationship with dotMailer ensures we always 
adopt best practice when it comes to automated email marketing 
and triggered campaigns to help customer acquisition, retention 
and recommendation.
Our approach to search marketing blends organic with paid and 
social marketing, to help our clients avoid dips in their traffic so 
their online business  stays at peak performance. We help drive 
traffic to clients’ sites to maximise cross-selling and up-selling.
We don’t just build websites, we help clients build online 
business. Through data, research and experience we give clients 
a complete, integrated digital marketing service that is perfectly 
suited to their brand and brief. We work on clients’ entire digital 
strategy; analysing end user’s journey through email campaigns 
as well as web and mobile use (including social media) to 
measure and share the actions they are taking so they can be 
used to underpin a successful digital strategy.
Our dedicated search team – dotSearch – create effective 
campaigns ensuring premium search engine positions attract 
the visitors who are of most value. To stay in tune with consumer 
behaviour, each client benefits from a tailored SEO plan which is 
continually reviewed and developed to ensure they achieve the 
best possible return on investment through the right strategy, 
key words, activity and language.
Digital Strategy Search Marketing
Our professional team understands ecommerce and will work 
with our clients to create a website that meets all project 
requirements. Using Magento and Umbraco open source 
platforms, our project managers and technical teams build 
robust, high-performing sites while our account managers 
continue to make sites profitable long into the future.
Social media websites are accessed by four out of five web 
users, and by creating effective online social media campaigns 
we help our clients benefit from this traffic. 
Ecommerce and CMS Social Media
Cross-sales of dotMailer 
integration improve 
customer engagement 
and data management
Developing powerful  
and measurable traffic 
driving campaigns
Continued focus and success  
across winning and servicing large 
corporations and brands
Ecommerce Web Design & Search Marketing www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
14
Investment in Hardware and Product R&D
Over the year, the Company, invested over £250k in new hardware  
for the technical infrastructure which supports its products, and  
in September 2012 moved to new oﬃces to provide capacity for 
further growth. 
The primary purpose of this investment was to provide greater 
capacity and scalability across all products, thereby ensuring that 
the Company can service its clients eﬀectively, while continuing to 
grow the business. The hardware architecture has been conﬁgured 
with this future growth in mind, in that the layers upgraded can now 
be scaled out at a relatively low capital cost as the business requires 
it. The hardware acquired, is also the ﬁrst phase of a larger technical 
implementation which will allow the Company to release several new 
major product features in the coming years. There was an immediate 
additional beneﬁt; as well as providing the platform for future growth, 
many existing workloads are now processed faster, providing direct 
performance beneﬁts to customers.
Signiﬁcant development work on the dotMailer platform has been 
completed in the year, including integration with several major CRM 
products (including Dynamics and Salesforce), integration with the 
eBay X-Commerce fabric, translation of the user interface into eight 
languages and development of a new visual drag & drop email 
template editor. Each of these initiatives endorses our development 
spend and demonstrates that we are proactive in extending our 
oﬀering to clients which boosts our capacity to increase client wins  
and grow revenues.
CHIEF EXECUTIVE’S REPORT CONTINUED
Hello
Guten Tag
Easy translation technology developed for 
international client and partner growth
dotMailer’s Drag & Drop EasyEditor allows  
everyone to be an email designer with no HTML, 
coding or web design skills
Full integration with the major CRM platforms
Bonjour
 The Company 
invested over 
£250k 
in new hardware
Watch dotMailer’s Salesforce 
Integration video. dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
15
People
As part of the Board’s strategy to position the business for further 
sustained growth, there has been a considerable investment in people 
during the year, with a key focus on adding experience and depth to 
the senior management of the business.
The appointment of Frank Beechinor-Collins as Chairman and Richard 
Kellett-Clarke FCA as senior independent Director in Spring 2011 has 
signiﬁcantly strengthened the experience and working of the Board 
during the year. 
Both Richard and Frank bring CEO-level experience of running an  
AIM business in related sectors. Richard has been appointed chair of  
the remuneration committee and audit committee during the year.  
It is the intention of the Directors to add a further non-Executive 
Director during 2012/13, subject to identifying a candidate with the 
requisite experience, skills and industry knowledge. 
In 2011, the Board had identiﬁed a number of key business areas  
where additional skills and experience would be an essential element 
of delivering on the growth strategy. New key hires have been made  
in the following areas:
Employee Engagement Head of HR
Systems Integration  Senior Systems Architect, 
& Scaling Head of Product Integration
Business Development Director of Channel Development, 
  Director of  Marketing Communications
Business Operations Head of Process Change,  
  Director of Search & Agency Operations,  
  Head of SEO Strategies
 
With ambitious growth plans for the future, the Board believes that 
hiring the best people and providing a culture where all staﬀ are 
engaged in the business, is vital to the continued success, albeit this 
will have a short impact on cost/income ratios.
As part of the strategy to ensure the business has the talent and 
culture to maintain growth the Board took the decision to enter  
the ‘Sunday Times 100 Best Companies to Work For’ competition.
Although we were just outside the Top 100 this year, we were 
delighted to receive a star rating and a good understanding of  
areas for improvement in coming years. As part of the maturing  
of the business, the Board have committed to further investment  
in training, development and mentoring with the aim of attracting  
and retaining the best people.
During the year, the Company signiﬁcantly enhanced the training  
and development programmes available and has provided all 
employees with access to bespoke key skills training, as well as 
continuing speciﬁc niche skills development across industry and 
professional skills development. The Group has seen a greater 
percentage of employees than ever before studying towards and 
achieving professional qualiﬁcations, equipping themselves and  
the business with specialist expertise.
The Board’s commitment to an open and honest working environment 
continues with clear communication of business progress through 
weekly Company meetings; including an anonymous  ‘Ask the Board’ 
questions slot, regular newsletters, and lunches for new and existing 
employees with the Board. 
The Board strives to oﬀer a competitive beneﬁts package in order to 
attract and retain the best talent, including share option schemes and 
bonuses based on Company and individuals’ performances. Total reward 
statements are now available to all employees to provide complete 
visibility into the total value of salaries, beneﬁts and rewards earned 
through the year. 
I would like to take this opportunity to thank all our staﬀ for their 
tremendous commitment and performance over the past year.
There has been considerable focus in the period 
on the strengthening of the senior operational 
management group who manage the on going 
business. 
Being voted as dotDigital’s Employee of the 
Year by my colleagues is an incredible honour,  
               especially as the business employs so  
                   many talented people.
Wayne Parker, 2011/12 Employee  
of the Year Celebration www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
16
2012/13 the  
year ahead...
Outlook for the Y ear Ahead
During 2012/13 we anticipate that changes to the dotMailer platform 
and the reorganisation within the sales and client services teams will 
further improve sales in the corporate sector. Recent client wins in 
this sector suggest that ease-of-use combined with powerful features, 
eﬀective integrations and marketing automation is providing a good 
ratio of client wins from pitches attended. The recent addition of 
multiple language user interface options together with, a soon to be 
launched, social broadcast capability are also expected to help open 
opportunities with global organisations.
Early results from our international expansion are encouraging and 
we expect to build the international sales team progressively during 
2012/13 where we see growth opportunities.
Initial feedback on the newly launched dotSurvey has been extremely 
positive and in quarter one of the new ﬁnancial year we plan to run 
trial marketing campaigns to establish the customer acquisition costs 
of various digital marketing channels. Based on the results of this trial, 
the Board will agree a plan for signiﬁcant focused marketing of this 
product both in the UK and globally.
During the year, we evaluated a number of potential acquisition 
opportunities of email marketing businesses. However, given that we 
would eﬀectively be acquiring clients, and not the brand, the software 
platform or the management, in the opinion of the Directors none of 
the businesses evaluated were judged to be value enhancing when 
predicted future revenues and proﬁts were compared to asking prices.
Although, we will continue to proactively seek and evaluate 
acquisitions, our strategy will focus upon successful organic growth 
and as a business we need to invest in cost-eﬀective marketing 
to ensure the growth is maintained. With a product like the new 
online survey tool, the income is annuity-based and one of the key 
decisions required will be to determine the level of upfront marketing 
investment to generate future annuity income streams.
To maintain our record of strong organic growth we will continue to 
focus on product innovation, understanding our clients’ requirements 
and delivering return on investment for our clients. We will also 
continue to selectively expand our international activities. 
We will continue to 
develop powerful and 
easy-to-use tools that 
enable non-technical 
users to plan, design, 
execute and evaluate  
multi-channel 
campaigns.
Early results from our 
international expansion 
are encouraging and 
we expect to build the 
international sales team.
CHIEF EXECUTIVE’S REPORT CONTINUED
Watch Proactive Investors 
Interview of dotDigital 
Group’s COO, Tink Taylor  
and  CTO, Simon Bird.   dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
17
do ot tD
The Future
The product roadmap for the business will be based around the  
vision of a SaaS (cloud) based digital marketing automation platform, 
built to enable marketers to deﬁne prospect and client engagement 
communications in a highly visual way, to deﬁne triggered messages 
via multiple channels, where the content delivered is segmented, 
timely and relevant to the recipient, eg. the platform will deliver 
triggered messages for events such as shopping cart abandonment  
or web page bounce automatically and in real time. 
Our passion for ease of use and visual tools for non-technical users  
will enable the design, creation, and execution of campaign workﬂows 
across every digital channel while enabling the use of marketing best 
practices and management controls.
P A Simmonds
Chief Executive and Chief Financial Officer 
The product roadmap for the 
business will be based around  
the vision of a SaaS (cloud) based 
digital marketing automation 
platform, built to enable marketers 
to define prospect and client 
engagement communications in 
a highly visual way via multiple 
channels, where the content 
delivered is segmented, timely  
and relevant to the recipient.
2000       Now
dotMailer Platform Product Roadmap
Email
Landing 
Page 
Builder
Drag & Drop 
Visual Editor
Administrator 
Interface
CRM 
Integrations
Survey
Shop
Social Media 
Management
SMS/
Mobile
Translation
Marketing 
Automation
Product innovation for growth www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
18
CORPORATE SOCIAL RESPONSIBILITY REPORT
During the past year, the Group continued with its on-going 
commitment to social responsibility in the market in which it operates, 
to its employees, suppliers and to the broader environment.
Clients
The Company prides itself on ensuring that our products and services 
are designed to meet the expectations of our clients and their 
customers. Feature forums allow clients to request features and  
vote on feature priority, feeding directly into the development 
schedules for our SaaS product oﬀerings. dotAgency services are 
designed and delivered against a best-ﬁt model; delivering projects 
that provide maximum return on investment for clients, on time and 
on budget.
The Group is committed to complete transparency with our clients, 
providing pricing structures that are clear, and oﬀering packages that 
allow clients to deliver successful campaigns. A pricing calculator is 
provided for dotMailer licenses and packages to allow clients and 
potential clients to cost their campaigns, and our experienced sales 
team are able to assist clients in pricing guidance across all our 
products and services. dotMailer is also oﬀered with a money-back 
guarantee to give clients maximum conﬁdence in our products and 
services.
dotDigital products and services are supported by an expert team;  
giving access to support via email, telephone and live chat. We also 
provide additional managed services for our products, enabling our 
clients to deliver successful campaigns and projects.
Employees
The Group has continued to invest in the development of our 
people across the Group thus underpinning the critical role that our 
employees play in the success of the business.
The Board has signiﬁcantly enhanced the training and development 
programme available, to provide all employees with access to bespoke 
key skills training, as well as continuing speciﬁc skills development 
in areas relating to the industry we operate in and, in addition, 
professional skills development. The Group now has a greater 
percentage of employees than ever before studying towards and 
achieving professional qualiﬁcations, equipping themselves and the 
business with specialist expertise.
The Board’s commitment to an open and honest working environment 
continues with clear communication of business progress through 
weekly Company meetings; including an anonymous ‘Ask the Board’ 
questions slot, regular newsletters, and lunches for new and existing 
employees with the Board. 
The Board strives to oﬀer a competitive beneﬁts package in order to 
attract and retain the best talent, including share option schemes and 
bonuses based on Company and individuals’ performance. Total reward 
statements are now available to all employees to provide completely 
visibility into the total value of salaries, beneﬁts and rewards earned 
through the year. 
It is the policy of the Group to ensure that at all times there are equal 
opportunities for all employees with no discrimination on account 
of race, age, gender, sexual orientation, disability and political or 
religious beliefs. Our philosophy is to ensure that ability, contribution 
to the business and potential to develop are the determining factors 
in the selection, training, career development and promotion of all 
employees.
Investment in our oﬃces continues, ensuring both a pleasant and  
safe working environment for all employees. Above all, the Board work 
continually to ensure that our work places are safe and comply with 
all relevant legislation; the Group has not been subject to sanctions or 
ﬁnes for environmental, health and safety or other infringements.
The Board strives to offer a competitive benefits 
package in order to attract and retain the best 
talent, including share option schemes and 
bonuses based on Company and individuals’ 
performance. 
dotDigital adopts a charity each year; 
this year the Board elected to continue 
our partnership with Macmillan Cancer 
Support through our Big Pink campaign.  dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
19
Risks 
The Board is cognisant of the need to monitor potential threats to 
the business and our workforce. To this end the Board has established 
a Risk Committee consisting of both non-Executive Directors and 
management. This committee meets regularly to evaluate on 
going risks to the business and this includes risks posed both to our 
employees and any potential risks to the business from suppliers and 
partners. Any recommendations by this committee are put directly  
to the Board for further discussion and implementation. 
Community
Our roots within our community are very important. The Board are 
committed to working with our local and wider communities across 
our various sites to continue to build the connections that have been 
developed over the years.
dotDigital adopts a charity each year; this year the Board elected to 
continue our partnership with Macmillan Cancer Support through  
our Big Pink campaign. Some of the activities we supported in the  
past year included the Board pledging donations in conjunction with 
our entry to the Sunday Times 100 Best Companies and donating gifts 
at Christmas time to this charity.  
The Group also oﬀers its products and services to all charities at 
preferential rates, and we are very proud of our strong client base of 
charitable organisations including The Disabilities Trust, the Fairtrade 
Foundation and SeeAbility. This year, the Board has increased its 
commitment to sponsoring Louise Cook, the British Female Rally 
Champion. Louise masterminded a unique sponsorship programme to 
allow her to race and the Board are delighted to be able to support  
her on going successes on the rallying circuit. 
Within our local communities, the Company provides work experience 
and internship opportunities for local students, and we actively 
recruit from the local talent pool. This year, we also introduced a new 
volunteering scheme which allows paid time oﬀ for all employees to 
volunteer on a number of programmes, including local environmental 
projects and fundraising events.
Environment
The very nature of dotDigital business activities works to move our 
clients away from traditional paper-based marketing methods by 
providing digital marketing channels, through email marketing, online 
surveys and by enhancing digital presence through websites and other 
online proﬁle drivers. 
Our modern oﬃces are optimised to deliver an environmentally-
friendly working environment, from power saving lights that are  
linked to motion sensors to low energy modern equipment. Our  
on going investment in our IT infrastructure means that the Group  
is continuously improving upon our environmental impact. Extensive 
recycling facilities are provided and along side day-to-day waste 
recycling, we also ensure old furniture and IT equipment are recycled  
or reused. 
The Group actively aims to reduce the amount of consumables 
used and source our products responsibly, for example, our cleaning 
suppliers use eco-friendly cleaning consumables. Our employees are 
encouraged to travel for business by public transport where possible 
to reduce transportation emissions.  
Suppliers
As part of the Groups’ strong commitment to our local community,  
we aim to source local suppliers wherever possible. This is underlined 
by the fact that a number of our suppliers have been with the 
Company for many years and we consider our key suppliers as 
partners. dotDigital aims to work with partners and suppliers with 
similar ethical standards and values. At dotDigital, we understand  
the importance or fair and equal treatment, and particularly drive 
towards transparent and fair payment terms and processes.
This year the Board 
has increased the 
commitment to 
sponsoring Louise 
Cook, the British 
Female Rally 
Champion. www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
20
OUR BOARD OF DIRECTORS
Peter Simmonds FCCA, aged 54  
Chief Executive and Chief Financial Officer
Peter Simmonds commenced his career in 1976 as a trainee 
accountant with Unilever PLC and has over 30 years of experience 
at senior management and board level, principally in the areas of 
banking, insurance, ﬁnance, IT, outsourcing and software. As well 
as large company experience, he has considerable entrepreneurial 
experience having been involved at start-up or early stage of a number 
of companies in various industry sectors including consultancy 
services, vehicle leasing, software and internet solutions.
As well as being an experienced ﬁnance professional, Peter has 
considerable experience of acquisitions, disposals, post-acquisition 
integration, change management and creating cultures and structures 
to facilitate entrepreneurship and growth.
Simon Bird, aged 36  
Chief Technical Officer
Simon Bird has developed an in-depth technical 
knowledge of the internet and its applications. Prior 
to co-founding dotDigital Group, he assisted in the 
development of a major internet access provider.  
He has provided services to a number of well-known 
companies and organisations helping create websites, 
intranets, extranets, content management systems  
and other online solutions.
“Tink “ Ian Taylor, aged 39  
Chief Operating Officer
Tink Taylor has many years’ experience in the ﬁeld of interactive 
electronic communications. Tink has wide-ranging experience in 
introducing the concept of digital marketing to companies large  
and small. He is an elected member of the Direct Marketing 
Association’s Email Marketing Council and also a member of the 
Internet Advertising Bureau’s E-communications Council. Tink was  
a judge for the Email and Virals category at the DMA awards.
“Skip” Gordon Fidura, aged 43  
Client Services Director
Skip Fidura joined the dotDigital Group in January 2009 with a remit to 
build our digital strategy services oﬀering. Skip has been in marketing 
for over 14 years, most recently as Email Partner at OgilvyOne London 
and prior to that as the Director of European Operations for Acxiom 
Digital. He has worked with clients such as BT, Kodak, hp, Intel, and 
Travelocity.co.uk. Skip is also Vice-Chairman of the UK DMA Email 
Marketing Council and was listed by Revolution Magazine as one  
of the 50 most inﬂuential people in new media. dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
21
Milan Patel ACCA ACSI, aged 28 
Company Secretary & Financial Controller
Milan joined the Company in 2007 and was appointed 
Group Company Secretary in 2009. Milan is a member of 
the Association of Chartered Certiﬁed Accountants, an 
associate member of the Chartered Institute of Securities and 
Investments and holds a BA (Hons) degree in Accounting and 
Finance. Milan has over seven years experience in accounting 
and ﬁnance within the media and logistics industry. He has 
been responsible for the ﬁnancial and legal aspects of the 
reverse acquisition of West End Ventures PLC, acquisition of 
Netcallidus, admission to Plus and the introduction to AIM. 
He is also responsible for the Group’s functions in ﬁnancial 
management and reporting, regulatory compliance, legal 
and corporate governance. 
 
Frank Beechinor-Collins, aged 48 
Non-Executive Chairman
Frank Beechinor, was for 11 years, CEO of One Click HR, an 
AIM quoted IT/Human Resources business of which he was 
a co-founder. The Company operated in the UK and North 
America and had around 200 employees. Frank oversaw 
the successful sale of the business to ADP , a US$4bn NYSE 
listed company, for US$25m. In notable addition, Frank was 
for ﬁve years, Operations Director of GMCS, part of Grand 
Metropolitan, a UK-based training services provider, with 
several thousand employees. Frank brings a great deal of 
corporate experience to the Board, gained over 25 years 
of working for and running public and private companies. 
Frank has a strong track record in M&A and brings with him a 
quality network of contacts in the ﬁelds of managed services 
and Software as a Service (SaaS).
Richard Kellett-Clarke FCA, aged 57 
Non-Executive Director
Richard Kellett-Clarke brings to the Board over 25 years  
of management experience in the turn round and 
strategic repositioning and recovery of creative businesses 
in CMCG, media, electronics and software industries. 
He was a founder of AFX NEWS Limited, now part of 
Thomson Reuters, and Sealed Media, now owned by 
Oracle. He has held numerous CFO roles in subsidiaries 
of large PLCs as well as the role of IT Director at Financial 
Times Information. He was part of the team as CFO which 
brought Picwick Group PLC to the main market and  
Brady PLC to AIM. He is currently the CEO of Idox PLC 
an AIM-listed specialist software, solutions and KM 
consultancy business. www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
22
CORPORATE GOVERNANCE REPORT
The Board has decided to provide corporate governance disclosures in 
accordance with the principles and provisions of  ‘The Combined Code: 
Principles of Good Governance and the Code of Best Practice’ (‘the Code’). 
As part of this process Turnbull guidelines set out in ‘Guidance for Directors 
on the Combined Code’ have also been reviewed and are covered in the 
‘Internal Control’ section. An explanation of how dotDigital Group Plc  
(the ‘Group’) has applied the principles and the extent to which the 
provisions in the Code have been complied with appears below.
Compliance Statement
(a) Directors
The details of the Group’s Board, together with the Audit and 
Remuneration Committees, are set out on pages 23 and 24.
The Board meets monthly and is responsible for strategy, performance, 
approval of major capital projects and the framework of internal 
controls. The Board has a formal schedule of matters reserved for 
speciﬁc review and decision. To enable the Board to discharge its 
duties, all Directors receive appropriate and timely information. Brieﬁng 
papers are distributed to all Directors in advance of Board meetings. 
All Directors have access to the advice and services of the Company 
Secretary, who is responsible for ensuring that Board procedures are 
followed and that applicable rules and regulations are complied with. 
At the year end, there were four Executive Directors, one independent 
non-Executive Director and an independent non-Executive Chairman.
The current constitution of the Remuneration Committee and the Audit 
Committee is shown on pages 23 and 24.
Appointments to the Board are nominated by an Executive Director 
and then considered by the full Board.
The service contracts of the Executive Directors are less than one year 
and determinable by six months’ notice.
(b) Directors’ Remuneration
As set out on page 25, the remuneration of the Executive Directors is 
determined by the Remuneration Committee while that of the non-
Executives is determined by the whole Board. The Directors are conscious 
of the importance of performance-related incentives and bonuses are 
paid based on performance as deemed appropriate by the Remuneration 
Committee. The Remuneration Committee use both ﬁnancial and non-
ﬁnancial benchmarks to determine the Executive Director bonuses.
(c) Relations with Shareholders
The Group encourages two-way communications with all its 
shareholders and responds quickly to all requests or queries received. 
All shareholders have at least twenty-one working days’ notice of the 
annual general meeting at which all of the Directors and the Chairman 
are normally available for questions. Comments and questions are 
encouraged from the shareholders at the meeting.
(d) Accountability and Audit
(i) Financial Reporting
Detailed reviews of the performance and ﬁnancial position of the Group 
are included in the Chief Executive’s statement. The Board uses this and 
the Report of the Directors’ on pages 26 to 30 to present a balanced and 
understandable assessment of the Group’s position and prospects. The 
Directors’ Responsibilities for the ﬁnancial statements is described on 
page 30.
(ii) Internal Control
The Board conﬁrms that it has established the procedures necessary 
to implement the guidance set out in “Internal Control: Guidance for 
Directors on the Combined Code” . The process of risk identiﬁcation, 
evaluation and management has been considered by the Board. 
It is the intention that this will continue to be kept under constant 
review and will be considered at each Board meeting in the future. 
The Board is continuing to take steps to embed internal control and 
risk management further into the operations of the business and to 
deal with areas of improvement which come to management and the 
Board’s attention.
The Directors acknowledge their responsibilities for the Group’s system 
of internal ﬁnancial control. Such a system can provide reasonable but 
not absolute assurance against material misstatement or loss. The Board 
conﬁrms that the procedures necessary to comply with the provisions 
of the Code, including the guidance of Turnbull, have been in place 
throughout the year ended 30th June 2012 and up to the date of the 
Report of the Directors’ . It has considered the major business risks and 
the control environment. Important control procedures, in addition 
to the day-to-day supervision of the business, include comparison of 
monthly management accounts to the budget.
(iii) Audit Committee and Auditors
The Audit Committee comprises Frank Beechinor-Collins and is 
chaired by Richard Kellett-Clarke. The Auditors of the Group may also 
attend part or all of each meeting and they have direct access to the 
committee for independent discussions, without the presence of the 
Executive Director, if required. The Audit Committee may examine 
any matters relating to the ﬁnancial aﬀairs of the Group, and to the 
Group’s audit. This includes reviews of the annual accounts and 
announcements, accounting policies, compliance with accounting 
standards, the appointment and fees of auditors and other such  
related functions as the Board may require.
(iv) Going Concern Basis
After making enquiries, the Directors have formed a judgment, at the 
time of approving the ﬁnancial statements, that there is a reasonable 
expectation that the Group has adequate resources to continue in 
operational existence for the foreseeable future. For this reason, the 
Directors continue to adopt the going concern basis in preparing the 
ﬁnancial statements. dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
23
The Audit Committee also reviewed the eﬀectiveness of the 
Company’s systems for internal ﬁnancial control and risk management. 
The Committee reviewed the Group’s credit control procedures and 
risks concerning IT controls.
Independence of External Auditors
Both the Board and the external auditors have safeguards in place to 
avoid the possibility that the auditors’ objectivity and independence 
could be compromised. Our policy in respect of services provided by 
the external auditors is as follows:
 Audit related services – the external auditors are invited to 
provide services which, in their position as auditors, they must 
or are best placed to undertake. This includes formalities relating 
to borrowings, shareholders’ and other circulars, various other 
regulatory reports and work in respect of acquisitions and disposals;
 Tax consulting – in cases where they are best suited, we use the 
external auditors. All other signiﬁcant tax consulting work is put out 
to tender;
 General consulting – in recognition of public concern over the 
eﬀect of consulting services on auditors’ independence, our policy 
is that the external auditors are not invited to tender for general 
consulting work.
Internal management accounting
The Audit Committee reviewed the performance of the internal 
accounting function, the department’s resource requirements and 
also approved the internal budgets for the year ended 30th June 2012. 
The Committee concluded that these budgets were both prudent and 
realistic in the context of the Group’s ambitions.
Richard Kellett-Clarke 
Chairman of the Audit Committee
The Audit Committee is a sub-committee of the Board. The 
responsibilities of the committee include:
 Reviewing the half-yearly and full year accounts and results 
announcements of the Company and any other formal 
announcements relating to the Company’s ﬁnancial performance 
and recommending them to the Board for approval;
 Reviewing the Group’s systems for internal ﬁnancial control and risk 
management;
 Monitoring and reviewing the eﬀectiveness of the Group’s internal 
accounting function and considering regular reports which arise;
 Considering the appointment of the external auditors, overseeing 
the process for their selection and making recommendations to the 
Board in relation to their appointment to be put to shareholders for 
approval at a general meeting;
 Monitoring and reviewing the eﬀectiveness and independence of 
the external auditors, agreeing the nature and scope of their audit, 
agreeing their remuneration, and considering their reports on the 
Group’s accounts, reports to shareholders and their evaluation of 
the systems of internal ﬁnancial control and risk management.
Composition of the Audit Committee
The Audit Committee comprises Frank Beechinor-Collins and Richard 
Kellett-Clarke. The Chairman of the Audit Committee is Richard Kellett-
Clarke. The Committee meets separately with the external auditors 
without management being present.
The Secretary to the committee is Milan Patel, the Company Secretary.
Main Activities of the Audit Committee
At its meeting on the 2nd October 2012, the Committee reviewed 
the Group’s preliminary announcement of its results for the ﬁnancial 
year 30th June 2012 and the draft report and accounts for that 
year. The Committee received reports from the external auditors on 
the conduct of their audit, their review of the accounts, including 
accounting policies and areas of judgment, and their comments on 
risk management and control matters. The Group’s corporate social 
responsibility reporting arrangements and procedures were also 
reviewed.
The external auditors also presented their proposed fees and scope 
for the forthcoming year’s audit. The Committee also reviewed the 
performance of both the internal accounting function and external 
auditors. The review of the external auditors was used to conﬁrm the 
appropriateness of their reappointment and included assessment 
of their independence, qualiﬁcation, expertise and resources, and 
eﬀectiveness of their audit process.
AUDIT COMMITTEE REPORT www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
24
The Remuneration Committee
The Remuneration Committee was established to keep under review 
the remuneration and terms of employment of Executive Directors and 
to recommend such remuneration and terms and changes thereof to 
the Board. The Committee’s composition, responsibilities and operation 
comply with the Combined Code. In forming its remuneration policy, 
the Committee conﬁrms that it has complied with the Combined 
Code. The Committee comprises Frank Beechinor-Collins and Richard 
Kellett-Clarke (Chairman).
The Secretary to the committee is Milan Patel, the Company Secretary.
Remuneration Policy
The Group’s executive remuneration policy objectives are:
(a)   To ensure that individual rewards and incentives are directly aligned 
with the performance of the Group and that of the interests of the 
shareholders;
(b)   To maintain a competitive programme which enables the Group to 
attract and retain high calibre executives; and
(c)   To determine the terms of employment and remuneration for 
Executive Directors.
Key Elements of Remuneration for Executive Directors
The Committee considers the key elements in total to ensure there is 
the right balance between reward for short-term success and long-
term growth. For Executive Directors, this is summarised as follows:
Base Pay 
Reviewed against:
 Salary levels in comparable sized companies listed on AIM;
 Market conditions and Company performance;
 Level of pay awards in rest of the business;
 Role and responsibility of the individual Director.
Benefits 
Reviewed against:
 Total reward structure for all employees; and
 Provided on a market competitive basis.
Annual Bonus Scheme 
Reviewed against:
 Group proﬁt before tax (PBT) with an individual performance 
element linked to object delivery;
 Drive proﬁtability and strategic change across the group;
 Delivery of the overall business strategy.
Service Contracts
On 7th January 2009, the Executive Directors each entered into a 
service contract with the Group, the terms of which commenced 
upon admission to PLUS Markets on the 2nd of February 2009. Each 
appointment runs for one year from that date and is terminable by 
six months’ notice by either party to expire at the end of that year or 
at any time thereafter. The agreement contains restrictive covenants. 
Upon termination, no beneﬁts (other than those accruing during the 
notice period) are due to the Director.
Employee Incentive Schemes
The Group has awarded share options under EMI, approved share 
option schemes to key employees who had completed their probation 
period at the date of grant. The Board considers the performance 
of staﬀ in conjunction with the Group during the bi-annual review 
process. Discretionary bonuses are awarded based on individual and 
Group performance.
Approved by the Remuneration Committee 
Signed on its behalf by
Richard Kellett-Clark
Chairman of Remuneration Committee
REMUNERATION COMMITTEE REPORT  dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
25
Directors’ Emoluments
       Median 
       Remuneration of 
    12m period ended 30.6.12   AIM proﬁtable  
Executive Director  Salary/Fees Beneﬁts Bonus Pension Total companies*
P Simmonds  110,000 5,452 40,000 11,000 166,452 280,773
I Taylor  110,000 6,843 40,000 11,000 167,843 181,267
S Bird  110,000 6,843 40,000 11,000 167,843 181,267
G Fidura  77,000 4,200 12,000 2,310 95,510 
  407,000 23,338 132,000 35,310 597,648 
 
    12m period ended 30.6.11 
Executive Director  Salary/Fees Beneﬁts Bonus Pension Total 
P Simmonds  100,834 5,523 60,000 10,817 177,174 
I Taylor  102,500 6,757 45,000 10,458 164,715 
S Bird  102,500 6,757 55,000 10,458 174,715 
G Fidura  76,000 4,200 21,000 2,280 103,480 
  381,834 23,237 181,000 34,013 620,084 
* Median Remuneration for AIM proﬁtable companies is based on a Vitesse Media Research report of Directors’ pay 2012.
    12m period ended 30.6.12 
Non-Executive Director  Salary/Fees Beneﬁts Bonus Pension Total
F Beechinor-Collins  35,000    35,000
R Kellet-Clarke  31,591    31,591
N Nelson  18,214    18,214
  84,805    84,805
 
    12m period ended 30.6.11 
Non-Executive Director  Salary/Fees Beneﬁts Bonus Pension Total
F Beechinor-Collins  5,833 - - - 5,833
R Kellet-Clarke  2,917 - - - 2,917
N Nelson  27,500 - - - 27,500
D Pacy  6,667 - - - 6,667
  42,917 - - - 42,917
Directors’ Interests
The respective interests in the shares of the Company for the members of the Board at the year end and subsequent to that date are stated below:
Director      No. of Shares held 
      as at 30.6.12 % Holding
P Simmonds*      19,959,999 7.25%
I Taylor      53,876,667 19.57%
S Bird      45,860,000 16.65%
F Beechinor-Collins**      674,194 0.24%
      120,370,860 43.71%
*    4.74% of Peter Simmonds holdings/voting rights has been held by Frank Nominees Limited who acts as the nominee for Alliance Trust  
Pensions Limited, which is the trustee of a SIPP established by Peter Anthony Simmonds. Frank Nominees is the vehicle used by Kleinwort 
Benson Limited to hold securities for clients, trusts, SIPPs etc. The beneﬁciary of the SIPP is Peter Anthony Simmonds.
**  The 674,194 shares shown as being held by Mr Beechinor-Collins are owned by Curra Trust, a trust established for the beneﬁt of his children and 
in which he has no beneﬁcial interest.
 
Directors’ Interest in Share Options
Under the Group’s executive share option scheme the following Directors have the right to acquire Ordinary shares.
    No. of Share  Option Price Date First  
Executive Director   Grant Date options granted (Pence) Exercisable Expiry Date
G Fidura   22/10/2009 800,000 5.0 01/07/2010 01/02/2019
    11/11/2010 800,000 5.125 01/05/2012 31/12/2015
    13/10/2011 537,932 7.25 01/05/2012 01/02/2016 www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
26
REPORT OF THE DIRECTORS
The Directors present their report with the ﬁnancial statements of the 
Company and the Group for the year ended 30th June 2012. 
Principal Activity
The principal activity of the Group in the year under review was that  
of Software as a Service for marketing. 
Review of Business
During the year, the Group has shown signiﬁcant growth in customer 
numbers, sales, and proﬁts. Revenues grew from £9m in the year ended 
June 2011 to £12m for the year ended June 2012, an increase of 34%. 
Post-tax proﬁts grew from £1.91m in 12 months to June 2011 to 
£2.62m (excluding exceptional items) for the year ended June 2012;  
an increase of 37%.
Key Performance Indicators
The operations as a whole and the individual business units are 
managed and controlled using a variety of key performance indicators, 
appropriate to the goals they have been set. Examples of key 
performance indicators are:
  2012  2011 % Increase
Revenue 11,986,930 8,952,488 33.9% 
EBITDA 3,429,893 2,626,311 30.6% 
Volume of Sends 1,828,276,324 1,031,625,067 77.2%
New Clients 1,813 1,433 26.5% 
Recurring Revenue as a %  70.4 68.4  
Key Risks & Uncertainties
(i) Supplier, Computer Hardware and Internet Reliability  
Related Risks
The Group rents space for its servers located at hosting centres 
and purchases bandwidth from service providers in the UK to run 
the software and services it supplies. Although, it spreads the risk 
of computer hardware failure across multiple servers in multiple 
hosting centres and to date, there have been no signiﬁcant failures, 
there is no assurance of continuity of supply. An event resulting in a 
hosting centre going oﬀ-line for any signiﬁcant period of time or the 
termination of provision of services by one of those hosting centres 
for any reason may result in signiﬁcant loss of revenues and therefore 
materially harm the Group’s business, operating results and ﬁnancial 
condition. Similarly, events preventing or obstructing the servers from 
communicating over the internet, such as the future availability of a 
ﬁnite number of IP addresses, may restrict the capacity of the business.
(ii) ISP Reputation-Related Risks
A signiﬁcant proportion of the Group’s revenue is currently derived by 
charging a price per email for sending marketing emails on behalf of 
commercial marketing departments. The largest volume senders of 
emails tend to be companies sending to consumers. Consequently 
some of dotMailer’s largest customers send large numbers of emails to 
consumers.
The EU anti-spam regulations and US CAN_SPAM laws place 
restrictions on what and when companies are allowed to send 
marketing emails to consumers. dotMailer rents the use of its software 
and servers for clients to upload their own email lists and send their 
email marketing campaigns. dotMailer acts as the data processor in 
all instances and neither owns lists nor provides third parties with 
data and is therefore not directly liable for any breaches of the EU or 
US anti-spam regulations. However, where clients are considered by 
email recipients to be sending unwanted emails, there is an inherent 
mechanism within most email clients to make a complaint against 
the sender. The level or number of complaints is recorded by the 
larger ISP’s (Hotmail, Yahoo, AOL etc) against the IP address of the 
server sending the email; this complaint rate record establishes the 
reputation of each IP address.
An IP address with a poor reputation may not get a high level of 
delivery of emails.
dotMailer closely monitors the complaint rates for each of its clients 
and reacts quickly and accordingly to stop rogue campaigns. However, 
if too many new clients were to create and send campaigns which 
attracted high complaint rates, the reputation of dotMailer’s sending IP 
addresses could be diminished. This diminished reputation could aﬀect 
dotMailer’s ability to win or retain new clients and therefore could 
signiﬁcantly aﬀect its planned growth in revenues. dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
27
dotMailer also faces risks from commercial and non-commercial 
anti-spam services. There are a number of organisations who provide 
a service to individuals and companies to help them reduce spam 
in their inbox; examples include Spamhaus and Spamcop. These 
organisations allow individuals to report an email as spam. This 
reporting can rapidly propagate the blacklisting of an IP address 
or domain used to send the reported email. This could impact on 
dotMailer’s ability to deliver emails on behalf of other clients which 
could in turn impact on revenues.
It is also to be noted that as the ISP communities adopt ever tougher 
measure to deal with the problem of spam there is a risk that genuine 
marketing emails could be falsely labelled as spam and do not get 
delivered to the intended recipients.
(iii) Hacking and Information Security 
Although in the opinion of the Group’s Directors, the technical team 
at the Group takes sensible precautions against intrusions and loss of 
data and dotMailer employs a security manager to mitigate this risk, 
there is a possible risk that a hacking attack could result in a denial of 
service or loss of data.
(iv) Competitive Environment 
Although the Group’s revenues have consistently grown year-on-year, 
it competes in a competitive sector. Some of its competitors and 
potential competitors may have advantages over it in terms of ﬁnancial 
backing, business size, broader brand recognition and coverage of 
other geographic markets globally. Their capacity to leverage their 
marketing expenditures across a broader range of potential customers, 
form relationships with brand owners or make acquisitions of 
complimentary products inherently increases the risk to the Group‘s 
business model.
(v) Hire and Retain Key Personnel
The Group depends on the continued contributions of the Group’s 
senior management and other key personnel. The loss of the services 
of any of these executive oﬃcers or other key employees could harm 
the Group’s business.
The future success of the Group also depends on its ability to 
identify, attract and retain highly-skilled technical, managerial and 
sales personnel. The Group faces intense competition for qualiﬁed 
individuals from numerous technology and marketing companies.
(vi) Development of Products 
The digital marketing industry is fast-paced and rapidly adopts 
developing technologies. In order to stay competitive the Group  
needs to deploy resources to research and development activity  
and to constantly innovate.
The Group’s growth will depend upon the development, 
commercialisation and marketing of new products. If this is not done 
successfully, then the growth of the Group may be impaired. There 
is also a risk that this activity may not result in a leading edge or 
competitive products being brought to market in time to maintain  
a competitive advantage. The Group may be unsuccessful in its eﬀorts 
to develop products.
While the Group will continue to strive to ensure it is able to deliver 
products and services that meet the needs of its target clients, there 
is a risk that competitors may be ﬁrst to the market with products that 
entice clients away from dotMailer.
(vii) Data Privacy
Evolving data privacy regulations around the world may restrict our 
clients’ ability to collect, process, disclose and use personal information 
for marketing purposes which may impact on the use of digital 
marketing or its eﬀectiveness.
Governments and supervising authorities have enacted, and may  
in the future enact, laws and regulations concerning the solicitation, 
collection, processing, disclosure or use of consumers’ personal 
information. Evolving and changing regulations regarding personal 
data and personal information, both within the European Union and 
elsewhere, especially relating to classiﬁcation of IP addresses, machine 
identiﬁcation, location data and other information, may impact our 
business. Such laws and regulations require or may require us and our 
clients to implement privacy and security policies, permit consumers 
to access, correct or delete personal information stored or maintained 
by such companies, inform individuals of security incidents that aﬀect 
their personal information, and, in some cases, obtain consent to use 
personal information for certain purposes. Other possible legislation 
could, if enacted, impose additional requirements and prohibit the use 
of certain technologies, such as those that track individuals’ activities 
on web pages or record when individuals click on a link contained in 
an email message. Such laws and regulations could restrict our clients’ 
ability to collect and use email addresses, web browsing data and 
personal information, which may reduce demand for our solutions. 
(viii) Evolving Technology and Customer Requirements
Failure to respond to evolving technological and customer 
requirements or to introduce competitive enhancements and new 
features, may mean our SaaS solutions could become less competitive. www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
28
To remain a credible provider of multi-channel marketing SaaS 
solutions, we must continue to invest in research and development 
of new solutions and enhancements to our platform. The process of 
developing new technologies, products and services is complex and 
expensive and requires highly-skilled and talented software engineers 
and marketing expertise. SaaS development requires implementation 
of rapidly changing technologies, adhering to standards and 
regulations, anticipating client requirements and frequent product 
enhancements. The introduction of new solutions by competitors 
potentially makes our solutions less attractive or easy to sell. The 
success of our planned enhancements and new solutions depend 
on many factors, including user interface design, quality assurance 
testing, customer acceptance and training and good marketing 
communication. Failure to anticipate client requirements and 
successfully develop new solutions or features may impact growth  
and retention of existing clients.
Dividends
No dividends will be distributed for the year ended 30th June 2012. 
It is the Directors’ strategy to achieve capital growth on the strength 
of a consistency cash generative trading performance. During the 
last ﬁnancial year, cash reserves grew as a result of strong trading 
performance. Accordingly, the Directors believe that it is inappropriate 
to propose a dividend based on this strategy to invest in further 
growth.
Future Outlook
The Group provides digital marketing services across a range of areas. 
Each of these areas have shown market growth signiﬁcantly above 
that of the UK economy. The Board believes that our widespread 
brand recognition and strong product range will continue to present 
opportunities to expand and diversify proﬁtability in the coming year.
Directors
Except as noted, the Directors shown below have held oﬃce during 
the period from 1st July 2011 to the date of this report. 
 S Bird
 P A Simmonds
 I Taylor
 G Fidura
 R Kellett-Clarke
 F Beechinor-Collins
 N Nelson (Resigned 5th January 2012)
REPORT OF THE DIRECTORS CONTINUED
Group’s Policy on Payment of Creditors
The Group does not have a formal code that it follows with regard 
to payments to suppliers. It agrees payments terms with its suppliers 
at the time it enters into a binding contract for the supply of goods 
and services. The Company seeks to abide by these payment terms 
whenever it is satisﬁed that the supplier has provided the goods or 
services in accordance with the agreed terms. The average creditor  
day for the year is 25 (2011- 25 days).
Publication of Accounts on Company Website
Financial statements are published on the Company’s website. The 
maintenance and integrity of the website is the responsibility of the 
Directors. The Directors responsibility also extends to the ﬁnancial 
statements contained therein.
Indemnity of Officers
The Group purchases Directors’ and Oﬃcers’ insurance against their 
costs in defending themselves in legal proceedings taken against 
them in that capacity, and in respect of damages resulting from the 
unsuccessful defence of any proceedings.
Financial Instruments
Details of the Group’s risk management objectives and policies 
together with its exposure to ﬁnancial risk are set out in Note 21  
to the ﬁnancial statements.
The purpose of the policies is to ensure that adequate cost-eﬀective 
funding is available to the Group and exposure to ﬁnancial risk – 
interest rate, liquidity and credit risk is minimised.
Research and Development
In the markets in which the Group operates, eﬀective research and 
development is vital to maintaining competitive advantage and 
securing future income streams.
Going Concern
After making appropriate enquires, the Directors consider that the 
Company and 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 preparing the ﬁnancial 
statements.
Events after the Reporting Period
There are no events after the date of this report or the date the 
ﬁnancial statements were approved by the Board of Directors which 
impact on the ﬁgures as presented. dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
29
The Directors who served during the period and their beneﬁcial interests in the shares of the Group as recorded in the Register of Directors’ 
interests at 30th June 2012 are as follows:
    30.6.12 Percentage  30.6.11 Percentage  
    Number of Shareholding Number of Shareholding 
Directors    shares held % shares held %
S Bird    45,860,000 16.65 52,860,000 19.22
I Taylor    53,876,667 19.57 60,860,000 22.13
P Simmonds     19,959,999* 7.25 19,943,333* 7.25
N Nelson     375,000 0.14    4,075,000 2.73
F Beechinor-Collins    674,194** 0.24 674,194** 0.25
*    Frank Nominees Limited holds 4.74% in respect of Peter Simmonds holding/voting rights act as nominee for Trust Alliance Pensions Limited. 
Frank Nominees is a vehicle used by Kleinwort Benson Limited to hold securities for clients, trusts, SIPPs etc. The beneﬁciary of the SIPP is Peter 
Anthony Simmonds.
**  The 674,194 share shown as being held by Mr Beechinor-Collins are owned by Curra Trust, a trust established for the beneﬁt of his children  
and in which he has no beneﬁcial interest.
The Directors who served during the period and their beneﬁcial interests in share options in the Group, as recorded in the register of Directors’ 
interests as at 30th June 2012 are as follows:
      30.6.12 30.6.11 
      Number of  Number of 
Executive Directors      options held options held
G Fidura      2,137,930 1,600,000
Substantial Interests
On 26th September 2012, the following parties had notiﬁed the Group of a beneﬁcial interest that represents 3% or more of the Group’s issued  
share capital at that date:
      2012 Percentage 
      Number of  Shareholding 
Shareholders      shares held %
I Taylor      53,876,667 19.57
S Bird        45,860,000 16.25
Newedge Group SA      30,300,000 11.00
BlackRock Inc.      30,085,218 10.93
P Simmonds      19,959,999 7.25
Legal and General Group PLC      19,192,000 6.97
BlackRock Smaller Companies Trust PLC      10,275,494 3.73
      www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
30
Listing
The Group’s Ordinary shares have been traded on London Alternative 
Investment Market (AIM) since 29 March 2011. Zeus Capital are 
the Group’s nominated advisors and together with Charles Stanley 
Securities are the joint brokers. The closing mid market share price at 
30th June 2012 was 11.25p (2011: 7.125p).
Statement of Directors’ Responsibilities
The Directors are responsible for preparing the Report of the Directors 
and the ﬁnancial statements in accordance with applicable law and 
regulations. 
Company law requires the Directors to prepare ﬁnancial statements 
for each ﬁnancial year. Under that law the Directors have elected to 
prepare the ﬁnancial statements in accordance with International 
Financial Reporting Standards as adopted by the European Union. 
Under Company law the Directors must not approve the ﬁnancial 
statements unless they are satisﬁed that they give a true and fair 
view of the state of aﬀairs of the Company and the Group and of the 
proﬁt or loss of the Group for that period. In preparing these ﬁnancial 
statements, the Directors are required to: 
 select suitable accounting policies and then apply them 
consistently; 
 make judgements and accounting estimates that are reasonable 
and prudent; 
 state whether the Group and Parent Company ﬁnancial statements 
have been prepared in accordance with IFRS’s as adopted by the 
European Union subject to any materials departures disclosed and 
explained in the ﬁnancial statements; 
 prepare the ﬁnancial statements on the going concern basis unless 
it is inappropriate to presume that the Company will continue in 
business. 
The Directors are responsible for keeping adequate accounting records 
that are suﬃcient to show and explain the Company’s and the Group’s 
transactions and disclose with reasonable accuracy at any time the 
ﬁnancial position of the Company and the Group and enable them 
to ensure that the ﬁnancial statements comply with the Companies 
Act 2006. They are also responsible for safeguarding the assets of the 
Company and the Group and hence for taking reasonable steps for the 
prevention and detection of fraud and other irregularities. 
The Directors are responsible for the maintenance and integrity of 
the corporate and ﬁnancial information included on the Company’s 
website. Legislation in the United Kingdom governing the preparation 
and dissemination of ﬁnancial statements may diﬀer from legislation in 
other jurisdictions.
REPORT OF THE DIRECTORS CONTINUED
Statement as to Disclosure of Information to Auditors
So far as the Directors are aware, there is no relevant audit information 
(as deﬁned by Section 418 of the Companies Act 2006) of which the 
Group’s Auditors are unaware, and each Director has taken all the steps 
that he ought to have taken as a Director in order to make himself 
aware of any relevant audit information and to establish that the 
Group’s Auditors are aware of that information. 
Auditors
The Auditors, Jeﬀreys Henry LLP , will be proposed for re-appointment 
at the forthcoming Annual General Meeting.
On behalf of the Board
P A Simmonds
Director  
8th October 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
31
REPORT OF THE INDEPENDENT AUDITORS
We have audited the ﬁnancial statements of dotDigital Group Plc  
for the year ended 30th June 2012, which comprise the consolidated 
income statement, consolidated statement of comprehensive income, 
consolidated statement of changes of equity, company statement 
of changes in equity, consolidated statement of ﬁnancial position, 
company statement of ﬁnancial position, consolidated statement of 
cash ﬂows, company statement of cash ﬂows and the related notes. 
The ﬁnancial reporting framework that has been applied in their 
preparation is applicable law and International Financial Reporting 
Standards (IFRSs) as adopted by the European Union, and as regards 
the Parent Company ﬁnancial statements, as applied in accordance 
with the provisions of the Companies Act 2006. 
This report is made solely to the Company’s members, as a body, in 
accordance with Chapter 3 of Part 16 of the Companies Act 2006. 
Our audit work has been undertaken so that we might state to the 
Company’s members those matters we are required to state to them 
in an auditors report and for no other purpose. To the fullest extent 
permitted by law, we do not accept or assume responsibility to anyone 
other than the Company and the Company’s members as a body, for 
our audit work, for this report, or for the opinions we have formed. 
Respective Responsibilities of Directors and Auditors 
As explained more fully in the Statement of Directors’ Responsibilities, 
the Directors are responsible for the preparation of the ﬁnancial 
statements and for being satisﬁed that they give a true and fair view. 
Our responsibility is to audit and express an opinion on the ﬁnancial 
statements in accordance with applicable law and International 
Standards on Auditing (UK and Ireland). Those standards require us to 
comply with the Auditing Practices Board’s Ethical Standards for Auditors. 
Scope of the audit of the Financial Statements 
An audit involves obtaining evidence about the amounts and 
disclosures in the ﬁnancial statements suﬃcient to give reasonable 
assurance that the ﬁnancial statements are free from material 
misstatement, whether caused by fraud or error. This includes an 
assessment of: whether the accounting policies are appropriate to 
the Group’s and the Parent Company’s circumstances and have been 
consistently applied and adequately disclosed; the reasonableness 
of signiﬁcant accounting estimates made by the Directors; and the 
presentation of the ﬁnancial statements. In addition, we read all the 
ﬁnancial and non-ﬁnancial information in the Chairman’s and Chief 
Executive’s report, Corporate Social Responsibility Report, Corporate 
Governance Report, Audit Committee Report, Remuneration 
Committee Report and Report of the Directors to identify material 
inconsistencies with the audited ﬁnancial statements.  If we become 
aware of any apparent material misstatements or inconsistencies we 
consider the implications for our report. 
Opinion on Financial Statements 
In our opinion the ﬁnancial statements: 
 give a true and fair view of the state of the Group’s and the Parent 
Company’s aﬀairs as at 30th June 2012 and of the Group’s proﬁt and 
Group’s and Parent Company’s cash ﬂow for the year then ended; 
 have been properly prepared in accordance with IFRSs as adopted 
by the European Union; 
 the Parent Company ﬁnancial statements have been properly 
prepared in accordance with IFRSs as adopted by the European 
Union and as applies in accordance with the provisions of the 
Companies Act 2006; and 
 the ﬁnancial statements have been prepared in accordance with 
the requirements of the Companies Act 2006. 
Opinion on other matter prescribed by the Companies Act 2006 
In our opinion the information given in the Report of the Directors  
for the ﬁnancial year for which the ﬁnancial statements are prepared  
is consistent with the ﬁnancial statements. 
Matters on which we are required to report by exception 
We have nothing to report in respect of the following matters where 
the Companies Act 2006 requires us to report to you if, in our opinion: 
 adequate accounting records have not been kept by the Parent 
Company, or returns adequate for our audit have not been received 
from branches not visited by us; or 
 the Parent Company ﬁnancial statements are not in agreement  
with the accounting records and returns; or 
 certain disclosures of Directors’ remuneration speciﬁed by law  
are not made; or 
 we have not received all the information and explanations we 
require for our audit. 
Sanjay Parmar 
Senior Statutory Auditor
For and on behalf of Jeﬀreys Henry LLP (Statutory Auditors) 
Finsgate 5-7 Cranwood Street, London, EC1V 9EE 
8th October 2012 www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
32
      30.6.12 30.6.11 
      £ £
Profit for the year      2,467,475 3,037,820
Other comprehensive income      - -
Total comprehensive income for the year       2,467,475 3,037,820
Total comprehensive income attributable to: 
Owners of the parent      2,467,475 3,037,820
       30.6.11 
      30.6.12 (restated) 
     Notes £ £
Continuing operations 
Revenue      11,986,930 8,952,488 
Cost of sales      (874,718) (647,142)
Gross profit      11,112,212 8,305,346
Administrative expenses      (8,239,391) (6,000,351)
Operating profit before exceptional items       2,872,821 2,304,995
Exceptional items: Cost relating to listing on AIM      - (119,826) 
Exceptional items: Impairment of goodwill due to adjustment to contingent consideration    (1,186,516) -
Operating profit      1,686,305 2,185,169
Finance costs     5 (682) (1,468) 
Finance income including exceptional items     5 1,087,837 1,127,862
Profit before income tax     6 2,773,460 3,311,563
Income tax expense     7 (305,985) (273,743)
Profit for the year      2,467,475 3,037,820
Profit attributable to: 
Owners of the parent      2,467,475 3,037,820
Earnings per share expressed in pence per share:     9 
Basic      0.90 1.16 
Diluted      0.88 1.07 
Adjusted excluding exceptional items      0.94 0.78 
Adjusted diluted excluding exceptional items      0.92 0.72
CONSOLIDATED INCOME STATEMENT  
FOR THE YEAR ENDED 30TH JUNE 2012
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
33
      30.6.12 30.6.11 
     Notes £ £
Assets 
Non-current assets 
Goodwill     10 2,934,045 4,120,561 
Intangible assets     11 1,753,057 990,557 
Property, plant and equipment     12 404,395 238,124
      5,091,497 5,349,242
Current assets 
Trade and other receivables     14 2,198,292 1,658,044 
Cash and cash equivalents     15 4,020,349 2,568,265
      6,218,641 4,226,309
Total assets      11,310,138 9,575,551
Equity attributable to the owners of the parent 
Called up share capital     16 1,376,811 1,374,861 
Share premium     17 4,754,853 4,737,053 
Reverse acquisition reserve     17 (4,695,465) (4,695,465) 
Other reserves     17 127,343 70,160 
Retained earnings     17 8,201,817 5,734,342
Total equity      9,765,359 7,220,951
Liabilities 
Non-current liabilities 
Financial liabilities  
 Financial instruments      19 - 1,243,492 
 Deferred tax     22 24,616 -
Current liabilities 
Trade and other payables     18 1,334,581 1,007,743 
Financial liabilities - borrowings  
 Interest bearing loans and borrowings      19 - 6,076 
Tax payable      185,582 97,289
       1,520,163 1,111,108
Total liabilities      1,544,779 2,354,600
Total equity and liabilities      11,310,138 9,575,551
The ﬁnancial statements were approved and authorised for issue by the Board of Directors on 8th October 2012 and were signed on its behalf by
P A Simmonds 
Director 
Company registration number: 06289659 (England and Wales)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION 
FOR THE YEAR ENDED 30TH JUNE 2012 www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
34
      30.6.12 30.6.11 
     Notes £ £
Assets 
Non-current assets 
Investments     13 7,511,030 8,704,468
      7,511,030 8,704,468
Current assets 
Trade and other receivables     14 12,684 25,746 
Cash and cash equivalents     15 83,293 235,274
      95,977 261,020
Total assets      7,607,007 8,965,488
Equity attributable to the owners of the parent 
Called up share capital     16 1,376,811 1,374,861 
Share premium     17 4,754,853 4,737,053 
Other reserves     17 127,343 70,160 
Retained earnings     17 129,063 498,060
Total equity      6,388,070 6,680,134
Liabilities 
Non-current liabilities 
Financial liabilities - borrowings  
 Interest bearing loans and borrowings      19 - 1,243,492
Current liabilities 
Trade and other payables     18 1,218,937 1,041,862
Total liabilities      1,218,937 2,285,354
Total equity and liabilities      7,607,007 8,965,488
The ﬁnancial statements were approved and authorised for issue by the Board of Directors on 8th October 2012 and were signed on its behalf by 
P A Simmonds
Director
Company registration number: 06289659 (England and Wales) 
COMPANY STATEMENT OF FINANCIAL POSITION 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
35
     Share Retained Share 
     capital earnings premium 
     £ £ £
Balance at 1st July 2010     1,292,500 2,696,522 4,533,754 
Issue of share capital     67,467 - 65,533 
Reclassiﬁcation of equity     14,894 - 137,766
Transactions with owners     82,361 - 203,299 
Proﬁt for the year     - 3,037,820 -
Transactions with owners     - 3,037,820 -
Balance at 30th June 2011     1,374,861 5,734,342 4,737,053
Issue of share capital     1,950 - 17,800 
Transactions with owners     1,950 - 17,800
Proﬁt for the year     - 2,467,475 -
Total comprehensive income     - 2,467,475 -
Balance at 30th June 2012     1,376,811 8,201,817 4,754,853
    Unissued Reverse 
    share acquisition Other Total 
    capital reserve reserves equity 
    £ £ £ £
Balance at 1st July 2010    152,660 (4,695,465) 29,493 4,009,464 
Issue of share capital    - - - 133,000 
Share based payment    - - 40,667 40,667 
Reclassiﬁcation of equity    (152,660) - - -
Transactions with owners    (152,660) - 40,667 173,667 
Proﬁt for the year    - - - 3,037,820
Total comprehensive income    - - - 3,037,820
Balance as at 30th June 2011    - (4,695,465) 70,160 7,220,951
Issue of share capital    - - - 19,750 
Share based payment    - - 57,183 57,183
Transactions with owners    - - 57,183 76,933 
Proﬁt for the year    - - - 2,467,475
Total comprehensive income    - - - 2,467,475
Balance at 30th June 2012    - (4,695,465) 127,343 9,765,359
 Share capital is the amount subscribed for shares at nominal value.
 Share premium represents the excess of the amount subscribed for share capital over the nominal value of the net share issue expenses.
 Retained earnings represents the cumulative earnings of the Group attributable to equity shareholders.
 Unissued share capital relate to the shares due to be issued in relation to the acquisition of dotSearch Limited (previously known as  
Netcallidus Limited).
 The reverse acquisition reserve relates to the adjustment required to account the reverse acquisition in accordance with International    
Financial Reporting Standards.
 Other reserves relate to the charge for the share based payment in accordance with International Financial Reporting Standard 2. 
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 
FOR THE YEAR ENDED 30TH JUNE 2012 www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
36
     Share Retained Share 
     capital earnings premium 
     £ £ £
Balance at 30th June 2010     1,292,500 (329,205) 4,533,754 
Issue of share capital     67,467 - 65,533 
Reclassiﬁcation of equity     14,894 - 137,766
Transactions with owners     82,361 - 203,299 
Proﬁt for the year     - 827,265 -
Total comprehensive income     - 827,265 -
Balance at 30th June 2011     1,374,861 498,060 4,737,053
Issue of share capital     1,950 - 17,800
Transactions with owners     1,950 - 17,800 
Proﬁt for the year     - (368,997) -
Total comprehensive income     - (368,997) -
Balance at 30th June 2012     1,376,811 129,063 4,754,853
     
     Unpaid 
     Share Other Total 
     capital reserves equity 
     £ £ £
Balance at 1st July 2010     152,660 29,493 5,679,202
Issue of share capital     - - 133,000 
Reclassiﬁcation of equity     (152,660) - - 
Share based payment     - 40,667 40,667
Transactions with owners     (152,660) 40,667 173,667 
Proﬁt for the year     - - 827,265
Total comprehensive income     - - 827,265
Balance at 30th June 2011     - 70,160 6,680,134
Issue of share capital     - - 19,750 
Share based payment     - 57,183 57,183
Transactions with owners     - 57,183 76,933 
Proﬁt for the year     - - (368,997)
Total comprehensive income     - - (368,997)
Balance at 30th June 2012     - 127,343 6,388,070
 Share capital is the amount subscribed for shares at nominal value.
 Share premium represents the excess of the amount subscribed for share capital over the nominal value of the net share issue expenses.
 Retained earnings represents the cumulative earnings of the Group attributable to equity shareholders.
 Unissued share capital relate to the shares due to be issued in relation to the acquisition of dotSearch Limited (previously known as  
Netcallidus Limited)
 Other reserves relate to the charge for the share based payment in accordance with International Financial Reporting Standard 2.
COMPANY STATEMENT OF CHANGES IN EQUITY 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
37
      30.6.12 30.6.11 
      £ £
Cash flows from operating activities 
Cash generated from operations     28 (236,478) (257,589)
Net cash from operating activities      (236,478) (257,589)
Cash flows from investing activities 
Contingent consideration on acquisition of subsidiary     (164,100) -
Net cash from investing activities      (164,100) - 
Cash flows from financing activities 
Loan from/(to) Group companies      228,847 (25,469) 
Share issue      19,750 133,000
Net cash from financing activities      248,597 107,531
Decrease in cash and cash equivalents       (151,981) (150,058)
Cash and cash equivalents at beginning of year      29 235,274 385,332
Cash and cash equivalents at end of year      29 83,293 235,274
      30.6.12 30.6.11 
     Notes £ £
Cash flows from operating activities 
Cash generated from operations     26 3,274,841 2,462,734 
Interest paid      (682) (1,468) 
Tax paid      (193,076) (478,461)
Net cash generated from operating activities      3,081,083 1,982,805
Cash flows from investing activities 
Contingent consideration on acquisition of subsidiary     (164,100) - 
Purchase of intangible ﬁxed assets      (1,172,867) (657,172) 
Purchase of tangible ﬁxed assets      (314,788) (160,624) 
Sale of tangible ﬁxed assets      637 - 
Interest received      8,445 5,034
Net cash used in investing activities      (1,642,673) (812,762)
Cash flows from financing activities 
Loan repayments in period      (6,076) (12,395) 
Share issues      19,750 133,000
Net cash generated from financing activities      13,674 120,605
Increase in cash and cash equivalents       1,452,084 1,290,648
Cash and cash equivalents at beginning of year      27 2,568,265 1,277,617
Cash and cash equivalents at end of year      27 4,020,349 2,568,265
CONSOLIDATED STATEMENT OF CASH FLOWS 
FOR THE YEAR ENDED 30TH JUNE 2012
COMPANY STATEMENT OF CASH FLOWS 
FOR THE YEAR ENDED 30TH JUNE 2012 www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
38
 The following accounting treatment has been applied in respect of 
the acquisition of dotDigital Plc:
 The assets and liabilities of dotDigital Plc are recognised and 
measured in the consolidated ﬁnancial statements at their fair value 
at the date of acquisition.
 The cost of an acquisition is measured as the fair value of the assets 
given, equity instruments issued and liabilities incurred or assumed 
at the date of exchange, plus costs directly attributable to the 
acquisition. Identiﬁable assets acquired and liabilities assumed in 
a business combination are measured initially at their fair values at 
the date of acquisition, irrespective of the extent of any minority 
interest. The excess of the cost of acquisition over the fair value of 
the Group’s share of the identiﬁable net assets acquired is recorded 
as goodwill. If the cost of acquisition is less than the fair value of the 
net assets of the subsidiary acquired, the diﬀerence is recognised 
directly in the income statement.
Subsidiaries
A subsidiary is an entity whose operating and ﬁnancing policies are 
controlled by the Group. Subsidiaries are consolidated from the date 
on which control was transferred to the Group. Subsidiaries cease to 
be consolidated from the date the Group no longer has control. Inter 
Company transactions, balances and unrealised gains on transactions 
between Group companies have been eliminated on consolidation.
As a result of applying reverse acquisition accounting in the prior 
period, the consolidated IFRS ﬁnancial information of dotDigital Group 
Plc is a continuation of the ﬁnancial information of dotMailer Limited.
Revenue Recognition
Revenue comprises the fair value of the consideration received or 
receivable for the sale of goods and services in the ordinary course of 
the Group’s activities. Revenue is shown net of value added tax returns, 
rebates and discounts after eliminating sales within the Group.
The Group recognises revenue when the amount of revenue can be 
reliably measured and it is probable that the future economic beneﬁts 
will ﬂow to the entity. The Group bases it’s estimates on historical 
results, taking in to consideration the type of customer, the type of 
transaction and the speciﬁcs of each arrangement.
The Group sells web based marketing services to other businesses and 
services are either provided on a usage basis or ﬁxed price bespoke 
contract. Revenue from contracts are recognised under percentage of 
completion method based on a percentage of services performed to 
date as a percentage of the total services to be performed.
Goodwill
Goodwill represents the excess of the fair value of the consideration 
over the fair values of the identiﬁable net tangible and intangible 
assets acquired.
Under IFRS 3 “Business Combinations” goodwill arising on acquisitions 
is not subject to amortisation but is subject to annual impairment 
testing. Any impairment is recognised immediately in the income 
statement and not subsequently reversed.
Intangible Assets
Intangible assets are recorded as separately identiﬁable assets and 
recognised at historical cost less any accumulated amortisation. These 
assets are amortised over their useful economic lives 4-5 years, with the 
charge included in administrative expenses in the income statement.
Intangible assets are reviewed for impairment annually. Impairment 
is measured by determining the recoverable amount of an asset 
or cash generating unit (CGU) which is the greater of its value in 
use and its fair value less costs to sell. In assessing value in use, the 
estimated future cash ﬂows are discounted to their present value 
1. General Information
dotDigital Group Plc (“dotDigital”) is a Company incorporated in 
England and Wales and quoted on the AIM Market. The address of the 
registered oﬃce is disclosed on the inside back cover of the ﬁnancial 
statements. The principal activity of the Group is described on page 26.
2. Accounting Policies
Basis of Preparation
These ﬁnancial statements have been prepared in accordance with 
International Financial Reporting Standards and IFRIC interpretations 
and with those parts of the Companies Act 2006 applicable to 
companies reporting under IFRS. The ﬁnancial statements have been 
prepared under the historical cost convention. 
The Group has applied all accounting standards and interpretations 
issued by the International Accountancy Standards Board and 
International Accounting Interpretations Committee eﬀective at the 
time of preparing the ﬁnancial statements.
The ﬁnancial statements are presented in sterling (£), rounded to the 
nearest pound.
New and Amended Standards Adopted by the Company 
There are no IFRSs or IFRIC interpretations that are eﬀective for the ﬁrst 
time in this ﬁnancial period that would be expected to have a material 
impact on the Group.
Standards, Interpretations and Amendments to Published Standards 
that are not yet Effective 
There are no other IFRSs or IFRIC interpretation that are not yet eﬀective 
that would be expected to have a material impact on the group.
Basis of Consolidation
In the period ended 2009, the Company acquired via a share for share 
exchange the entire issued share capital of dotMailer Limited, whose 
principle activity is that of web and email based marketing.
Under IFRS 3 ‘Business combinations’ the dotMailer Limited share 
exchange has been accounted for as a reverse acquisition. Although 
these consolidated ﬁnancial statements have been issued in the 
name of the legal parent, the Company it represents in substance 
is a continuation of the ﬁnancial information of the legal subsidiary, 
dotMailer Limited. The following accounting treatment has been 
applied in respect of the reverse acquisition:
 The assets and liabilities of the legal subsidiary, dotMailer Limited 
are recognised and measured in the consolidated ﬁnancial 
statements at their pre combination carrying amounts, without 
restatement to their fair value;
 The retained reserves recognised in the consolidated ﬁnancial 
statements for the beginning of the prior period reﬂect the retained 
reserves of dotMailer Limited to 30th April 2008. However, in 
accordance with IFRS3 ‘Business combinations’ the equity structure 
appearing in the consolidated ﬁnancial statements reﬂects the 
equity structure of the legal parent dotDigital Plc, including the 
equity instruments issued under the share exchange to eﬀect the 
business combination;
 A reverse acquisition reserve has been created to enable the 
presentation of a consolidated balance sheet which combines the 
equity structure of the legal parent with the non statutory reserves 
of the legal subsidiary;
 Comparative numbers are based upon the consolidated ﬁnancial 
statements of the legal subsidiary, dotMailer Limited for the year 
ended 30th June 2009 apart from the equity structure which 
reﬂects that of the parent.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
39
using a pre-tax discount rate that reﬂects current market assessments 
of the time value of money and the risks speciﬁc to the asset or CGU. 
For the purpose of impairment testing, assets that cannot be tested 
individually are grouped together into the smallest group of assets 
that generates cash inﬂows from continuing use that are largely 
independent of the cash inﬂows of other assets or CGU.
 Domain Names
Acquired domain names are shown at historical cost. Domain 
names have a ﬁnite life and are carried at cost less accumulated 
amortisation. Amortisation is calculated using straight line method 
to allocate the cost of domain names over their useful lives of  
four years.
 Software
Acquired software and websites are shown at historical cost. 
They have a ﬁnite life and are carried at cost less accumulated 
amortisation. Amortisation is calculated using straight line method 
to allocate the cost of software and websites over their useful lives 
of four years.
 Product Development
Product development expenditure is capitalised when it is 
considered that there is a commercially and viable technically 
product, the related expenditure is separable identiﬁable and there 
is a reasonable expectation that the related expenditure will be 
exceeded by future revenues. Following initial recognition, product 
developments are carried at cost less any accumulated amortisation 
and any accumulated impairment losses. The useful lives of these 
intangible assets are assessed to have a ﬁnite life of ﬁve years. 
Amortisation is charged on assets with ﬁnite lives, this expense is 
taken to the income statement and useful lives are reviewed on an 
annual basis. Amortisation is provided at the following annual rates’ 
commencing from the date the asset is developed to a stage at 
which the Company can receive economic beneﬁts from the asset.
Property, Plant and Equipment
Tangible non current assets are stated at historical cost less 
depreciation. Historical cost includes expenditure that is directly 
attributable to the acquisition of the items.
Subsequent costs are included in the assets carrying amount or 
recognised as a separate asset, as appropriate, only when it is probable 
that future economic beneﬁts are associated with the item will ﬂow 
to the Company and the cost of the item can be measured reliably. 
the carrying amount of the replaced part is derecognised. All other 
repairs and maintenance are charged to the income statement 
during the ﬁnancial period in which they are incurred. Depreciation is 
provided at the following rates in order to write oﬀ each asset over its 
estimated useful life and are based on the cost of assets less residual 
value. Signiﬁcant components of individual assets are assessed and if a 
component has a useful life that is diﬀerent from the remainder of that 
asset, that component is depreciated separately.
Short leasehold:  25% on cost
Fixtures and ﬁttings:  25% on cost
Computer equipment:  25% on cost
The asset’s residual values and useful economic lives are reviewed and 
adjusted, if appropriate, at each balance sheet date. An asset’s carrying 
amount is written down immediately to its recoverable amount if the 
asset’s carrying amount is greater then its estimated recoverable value.
Gains and losses on disposals are determined by comparing the 
proceeds with the carrying amount and are recognised within other 
(losses) or gains in the income statement. When devalued assets are 
sold, the amounts included in other reserves are transferred to retained 
earnings.
Borrowings
Borrowings are recognised at their fair value net of transaction costs 
incurred. They are classiﬁed as current liabilities unless the Group has 
an unconditional right to defer the settlement of the liability of at least 
12 months after the balance sheet date.
Borrowing costs are recognised in the income statement in the period 
in which they are incurred.
Capital Risk Management
The Group manages it’s capital to ensure it is able to continue as a 
going concern while maximising the return to stakeholders through 
the optimisation of the debt and equity balance. The capital structure 
of the Group consists of, cash and cash equivalents, short term ﬁnance 
and equity attributable to the owners of the parent as disclosed in the 
Statement of Changes in Equity.
Taxation
Current taxes are based on the results shown in the ﬁnancial 
statements and are calculated according to local tax rules, using tax 
rates enacted or substantially enacted by the balance sheet date.
Deferred Taxation
Deferred income tax is provided in full, using the liability method, on 
temporary diﬀerences arising between the tax bases of assets and 
liabilities and their carrying amounts in the ﬁnancial statements.
Deferred income tax assets are recognised to the extent that it is 
probable that future taxable proﬁt will be available against which the 
temporary diﬀerence will be utilised.
Deferred income tax is determined using tax rates that have been 
enacted or substantially enacted by the balance sheet date and are 
expected to apply when they related deferred income asset is realised 
or deferred income tax liability is settled.
Research and Development
Research expenditure is recognised as an expense when incurred. 
Costs incurred on development projects (relating to the design and 
testing of new or improved products) are recognised as intangible 
assets when the following criteria are fulﬁlled:
 It is technically feasible to complete the intangible asset so that it 
will be available of use or resale;
 Management intends to complete the intangible asset and use or 
sell it;
 There is an ability to use or sell the intangible;
 It can be demonstrated how the intangible asset will generate 
possible future economic beneﬁts;
 Adequate technical, ﬁnancial and other resource to complete the 
development and to use or sell the intangible asset are available; 
and
 The expenditure attributable to the intangible asset during its 
development can be reliably measured.
Other development expenditures that do not meet these criteria 
are recognised as an expense as incurred. Development costs 
previously recognised as an expense are not recognised as an asset in 
a subsequent period. Capitalised development costs are recorded as 
intangible assets and amortised from the point at which they are ready 
for use on a straight line basis over its useful life. www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
40
 Plant and Equipment, Intangible Assets & Impairment of Goodwill
Intangible assets excluding goodwill and plant and equipment 
are amortised or depreciated over their useful lives. Useful lives are 
based on management’s estimates of the period that the assets will 
generate revenue, which are periodically reviewed for continued 
appropriateness. Changes to the estimates used can result in 
signiﬁcant variations in the carrying value.
The Group assesses the impairment of plant and equipment and 
intangible assets subject to amortisation or depreciation whenever 
events or changes in circumstances indicate that the carrying value 
may not be recoverable.
Additionally, goodwill arising on acquisitions is subject to 
impairment review. The Group’s management undertakes an 
impairment review of goodwill annually or more frequently if 
events or changes in circumstances indicate that the carrying value 
may not be recoverable.
The complexity of the estimation process and issues related to the 
assumptions, risks and uncertainties inherent in the application 
of the Group’s accounting estimates in relation to plant and 
equipment and intangible assets aﬀect the amounts reported in the 
ﬁnancial statements, especially the estimates of the expected useful 
economic lives and the carrying values of those assets. If business 
conditions were diﬀerent, or if diﬀerent assumptions were used in 
the application of this and other accounting estimates, it is likely 
that materially diﬀerent amounts could be reported in the Group’s 
ﬁnancial statements.
The Directors have carried out a detailed impairment review in 
respect of goodwill. The Group assesses at each reporting date 
whether there is an indication that an asset may be impaired, 
by considering the net present value of discounted cash ﬂows 
forecasts which have been discounted at 6.67%. The cash ﬂow 
projections are based on the assumption that the Group can realise 
projected sales. A prudent approach has been applied with no 
residual value being factored. At the period end, based on these 
assumptions there was an indication of impairment of the value of 
goodwill for dotSearch. See note 10 for details.
However, if the projected sales do not materialise there is a risk that 
the value of the intangible assets shown above would be impaired.
 Share-based Compensation
The fair value of options and warrants are determined by reference 
to the fair value of the options granted, excluding the impact of 
any non-market vesting conditions (for example, proﬁtability and 
sales growth targets). Non-market vesting conditions are included 
in assumptions about the number of options that are expected to 
vest. At each balance sheet date, the entity revises its estimates of 
the number of options that are expected to vest. It recognises the 
impact of the revision to original estimates if any, in the income 
statement, with corresponding adjustment to equity.
 Contingent Considerations
The future consideration payable to the vendors of DotSearch 
(previously known as Netcallidus) in respect to the contingent 
consideration (earnouts) is based on the Directors’ best estimate of 
future obligations which are dependent on the future anticipated 
proﬁts after tax. It is assumed that the operating Company improves 
proﬁts in line with the Directors’ estimates. When earnouts are to be 
settled by both cash and equity consideration, the fair value of the 
consideration is obtained by discounting the amounts expected 
to be payable in the future to their present value. Reviews of the 
fair values are undertaken at each period end with any resulting 
adjustments being made through the Group’s income statement.
2. Accounting Policies continued
Operating Leases
Leases in terms of which the Group assumes substantially all the 
risks and rewards of ownership are classiﬁed as ﬁnance leases. Upon 
initial recognition the leased asset is measured at an amount equal 
to the lower of its fair value and present value of the minimum lease 
payments. Subsequent to initial recognition, the asset is accounted for 
in accordance the accounting policy applicable to that asset.
Other leases are operating leases and are not recognised in the Group’s 
statement of ﬁnancial position on a straight line basis over the term of 
the lease. Lease incentives received are recognised as an integral part 
of the total expense, over the term of the lease.
Use of Estimates and Judgements
The Group makes judgements, estimates and assumptions that 
eﬀect the application of policies and reported amounts of assets and 
liabilities, income and expenses. The resulting accounting estimates 
calculated using these judgements and assumptions will, by deﬁnition, 
seldom equal the related actual results but are based on historical 
experience and expectations of future events. The estimates and 
underlying assumptions are reviewed on a ongoing basis. Revisions 
to accounting estimates are recognised in the period in which the 
estimate is revised if the revision eﬀects only that period, or in the 
period of revision and future periods if the revision aﬀects both current 
and future periods.
The estimates and assumptions which have a signiﬁcant risk of causing 
a material adjustment to the carrying amount of assets and liabilities 
are discussed below:
 Impairment of Non Financial Assets (excluding Goodwill)
At each balance sheet date, the Group reviews the carrying 
amounts of its tangible and intangible assets to determine 
whether there is any indication that those assets have suﬀered 
an impairment loss. If any such indication exists, the recoverable 
amount of the asset is estimated in order to determine the extent 
of the impairment loss (if any). Where the asset does not generate 
cash ﬂows that are independent from other assets, the Group 
estimates the recoverable amount of the cash-generating unit to 
which the asset belongs. An intangible asset with an indeﬁnite 
useful life is tested for impairment annually and whenever there is 
an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and 
value in use. In assessing value in use, the estimated future cash 
ﬂows are discounted to their present value using a pre-tax discount 
rate that reﬂects current market assessments of the time value of 
money and the risks speciﬁc to the asset for which the estimates of 
future cash ﬂows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) 
is estimated to be less than its carrying amount, the carrying 
amount of the asset (cash-generating unit) is reduced to its 
recoverable amount. An impairment loss is recognised as an 
expense immediately, unless the relevant asset is carried at a re-
valued amount, in which case the impairment loss is treated as a 
revaluation decrease.
Where an impairment loss subsequently reverses, the carrying 
amount of the asset (cash-generating unit) is increased to the revised 
estimate of its recoverable amount, but so that the increased carrying 
amount does not exceed the carrying amount that would have been 
determined had no impairment loss been recognised for the asset 
(cash-generating unit) in prior years. A reversal of an impairment 
loss is recognised as income immediately, unless the relevant asset 
is carried at a revalued amount, in which case the reversal of the 
impairment loss is treated as a revaluation increase.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
41
2. Accounting Policies continued
Contingent Consideration
Contingent consideration is measured at fair value at the time of the 
acquisition. If the amount of the contingent consideration changes as 
a result of a post acquisition event (such as meeting proﬁt targets) the 
accounting for the change in consideration depends on whether the 
additional consideration is in cash or equity. If it is in equity the original 
amount is not recalculated but if the change is in cash or other assets 
the change is recorded in the income statement.
Trade Receivables
Trade receivables are recognised initially at the lower of their original 
invoiced value and recoverable amount. A provision is made when 
it is likely that the balance will not be recovered in full. Terms on 
receivables range from 30 to 90 days.
Equity
Share capital is the amount subscribed for shares at their nominal 
value.
Share premium represents the excess of the amount subscribed for  
the share capital over the nominal value of the respective shares net  
of share issue expenses.
Retained earnings represent the cumulative earnings of the Group 
attributable to equity Shareholders.
The reverse acquisition reserve relates to the adjustment required 
by accounting for the reverse acquisition in accordance with IFRS3 
‘Business Combinations’ .
Other reserves relate to the charge for share based payments in 
accordance with IFRS2 ‘Share Based Payments’ .
Share Based Payments
For equity settled share based payment transactions the Group, in 
accordance with IFRS 2 “Share Based Payments” measuring their value, 
and the corresponding increase in equity, indirectly, by reference to 
the fair value of the equity instruments granted. The fair value of those 
equity instruments is measured at the grant date using the trinomial 
method. The expense is apportioned over the vesting period of the 
ﬁnancial instrument and is based on the number which is expected 
to vest and the fair value of those ﬁnancial instruments at the date 
of grant. If the equity instruments granted vested immediately, the 
expense is recognised in full.
The assumptions on the expected life of share options, volatility of 
shares and risk free yield to maturity and expected dividend yield 
on shares are used in the fair value calculation of the share options 
outstanding at the year end (see note 26).
Trade Payables
Trade payables are recognised initially at fair value and subsequently 
measured at amortised cost using the eﬀective interest method. Terms 
on accounts payables range from 10 to 90 days.
Functional Currency Translation
 Functional and Presentation Currency
Items included in the ﬁnancial statements if the Company 
are measured using the currency of the primary economic 
environment in which the entity operates (functional currency), 
which is mainly pounds sterling (£) and it this currency the ﬁnancial 
statements are presented in.
 Transaction and Balances
Foreign currency transactions are translated in to the presentation 
currency using exchange rates prevailing at the dates of the 
transactions. Foreign exchange gains and losses resulting from the 
settlement of such transactions and from the translation at the year 
end exchange rates of monetary assets and liabilities denominated 
in foreign currencies are recognised in the income statement.
Employee Benefit Costs
The Group operates a deﬁned contribution pension scheme. 
Contributions payable by the Group’s pension scheme are charged  
to the income statement in the period in which they relate.
Segment Reporting
A business segment is a group of assets and operations engaged in 
providing products or services that are subject to risks and returns that 
are diﬀerent from those of other business segments. A geographical 
segment is engaged in providing products or services within a 
particular economic environment that are subject to risks and returns 
that are diﬀerent from those of segments operating in other economic 
environment. www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
42
3. Segmental Reporting
The Groups’ primary reporting format is business segments and its second format is geographical segments. The Group only operates in a single 
business and geographical segment. The Group’s single line of business is the provision of web based marketing services, whilst the geographical 
segment in which it operates is currently restricted to the UK. Accordingly no segmental information for business segment or geographical 
segment is required.
 
4. Employees and Directors
      30.6.12 30.6.11 
      £ £
Wages and salaries      5,603,058 3,964,709 
Social security costs      644,961 460,752 
Other pension costs      89,152 36,178
      6,337171 4,461,639
The average monthly number of employees during the year was as follows: 
      30.6.12 30.6.11
Directors      7 6 
Sales      49 27 
Web designers and developers      77 88 
Administration      41 12
      174 133
5. Net Finance Income
      30.6.12 30.6.11 
      £ £
Finance income: 
Exceptional item (see note 13)      1,079,392 1,122,828 
Deposit account interest      8,445 5,034
      1,087,837 1,127,862
Finance costs: 
Loan      682 1,125 
Interest payable      - 343
      682 1,468
Net finance income      1,087,155 1,126,394
The exceptional item outlined above under ﬁnance income relates to the revision of the contingent consideration due in relation to the 
acquisition of dotSearch Limited (previously known as Netcallidus Limited) in 2011. IFRS 3 relating to business combinations directs that any 
revaluations to the consideration should be credited to the income statement as ﬁnancial income. See note 13 for further details.
 
6. Operating Profit before Exceptional Items
Costs by Nature
Proﬁt from continuing operations has been arrived at after charging/(crediting):-
      30.6.12 30.6.11 
      £ £
Direct Marketing      380,391 365,399 
Outsourcing      475,926 255,630 
Other Costs      18,401 26,113
Total cost of sales      874,718 647,142
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
43
6. Operating Profit before Exceptional Items continued
       30.06.11 
      30.06.12 (Restated )  
      £ £
Staﬀ related costs (inc Directors emoluments)      5,426,918 4,020,736 
Operating leases: Land and buildings      354,533 321,463 
Operating leases: Other      67,936 42,795 
Audit remuneration      31,537 59,878 
Amortisation of intangibles      410,367 225,697 
Depreciation charge      146,705 95,621 
Legal, professional and consultancy fees      505,236 312,713 
Computer expenditure      409,007 201,207 
Bad debts      202,220 142,268 
Foreign exchange gains      (2,368) (18,035) 
Travelling      207,656 131,037 
Oﬃce running      182,790 109,978 
Other costs      296,854 354,993
Total administration expenses      8,239,391 6,000,351
 
Audit Remuneration
During the year the Group obtained the following services from the Group’s auditor at costs detailed below:
      30.6.12 30.6.11 
      £ £
Fees payable to the Group’s auditor of annual accounts     31,537 35,000 
Under provision of fees paid to Groups auditor in relation to the previous year    - 18,000 
Non audit fees: All other services      5,343 6,787
      36,880 59,787
7. Income Tax
Analysis of the Tax Charge
      30.6.12 30.6.11 
      £ £
Current tax: 
Tax       281,369 273,743 
Deferred tax      24,616 -
Total tax charge in income statement      305,985 273,743
Factors affecting the tax charge
The tax assessed for the year is lower than the standard rate of corporation tax in the UK. The diﬀerence is explained below: 
      30.6.12 30.6.11 
      £ £
Proﬁt on ordinary activities before tax      2,773,460 3,311,563 
Proﬁt on ordinary activities multiplied by the standard rate of corporation tax in the UK of 25% (2011 - 28%)  693,365 927,238 
Eﬀects of: 
Expenses not deductible         112,686 108,816 
Research and development enhanced claim        (559,640) (291,397) 
Eﬀect of proﬁts within marginal rate        (6,114) (9,314) 
Expenditure permitted on exercising options      - (136,184) 
Prior year under provision      15,792 - 
Exceptional item: impairment of goodwill      296,629 - 
Exceptional item: adjustment to contingent consideration     (269,848) (314,392) 
Capital allowances in excess of depreciation      (1,501) (11,024)
Total income tax      281,369 273,743 www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
44
8. Profit/(Loss) of Parent Company
As permitted by Section 408 of the Companies Act 2006, the proﬁt and loss account of the parent company is not presented as part of these 
ﬁnancial statements. The parent company’s loss for the ﬁnancial year was £368,997 (2011: proﬁt of £827,265). 
 
9. Earnings per Share
Earnings per share data is based on the consolidated proﬁt and the weighted average number of shares in issue of the parent company. Basic 
earnings per share are calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary 
shares outstanding during the period.
Diluted earnings per share is calculated using the weighted average number of shares adjusted to assume the conversion of all dilutive potential 
Ordinary shares.
Reconciliations are as follows:-
      30.6.12
      Weighted  
      average Per share  
     Earnings number of amount 
     £ shares pence
Basic EPS 
Net income attributable to owners of the parent     2,467,475 275,019,565 0.90
Diluted EPS 
Net income attributable to owners of the parent     2,467,475 281,111,611 0.88
Adjusted EPS 
Eﬀect of exceptional items:      
- Impairment of goodwill     1,186,516 - - 
- Reversal of ﬁnancial instrument (see note 13)     (1,079,392) - -
Adjusted earnings     2,574,599 275,019,565 0.94
Eﬀect of dilutive shares 
Options & Warrants     - 6,092,046 -
Adjusted Diluted EPS 
Adjusted earnings     2,574,599 281,111,611 0.92
 
      30.6.11
      Weighted  
      average Per share  
     Earnings number of amount 
     £ shares pence
Basic EPS 
Net income attributable to owners of the parent     3,037,820 261,891,138 1.16
Diluted EPS 
Net income attributable to owners of the parent     3,037,820 284,159,360 1.07
Adjusted EPS 
Eﬀect of exceptional items: 
- Cost relating to listing on AIM     119,862 - -
- Release of ﬁnancial instrument (see note 13)     (1,122,828) - -
Adjusted earnings     2,034,854 261,891,138 0.78
Eﬀect of dilutive shares 
Options & Warrants     - 22,268,222 -
Adjusted Diluted EPS 
Adjusted earnings     2,034,854 284,159,360 0.72
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
45
10. Goodwill
Group
           £
Cost 
At 1st July 2011 
and 30th June 2012       4,120,561
Amortisation 
Impairment (see note 13)       1,186,516
At 30th June 2012       1,186,516
Net book value 
At 30th June 2012       2,934,045
Cost 
At 1st July 2010 
and 30th June 2011       4,120,561
Net book value 
At 30th June 2011       4,120,561
 
Group
Impairment test for goodwill
Goodwill is allocated to the Group’s single cash generating units identiﬁed, that being dotMailer Limited and dotSearch (previously known as 
Netcallidus) Limited.
dotMailer Limited
The recoverable amount of a cash generating unit is determined based on value in use calculations. These calculations use pre tax cash ﬂow 
projections based on ﬁnancial budgets approved by management covering the ﬁve year period to 30th June 2017.
The key assumptions use to prepare the ﬁnancial budgets are as follows:
Revenue growth rates:      2013 11.00% 
       2014 30.00% 
       2015 30.00% 
       2016 30.00% 
       2017 30.00%
Pre tax discount rate:      All years 6.67%
Income tax rate:      All years 25.00%
The key assumptions used to prepare the ﬁnancial budgets are based on a combination of historical experience and current industry knowledge 
and trends.
dotSearch (previously known as Netcallidus) Limited
Revenue growth rates:      2013 (18.00)% 
       2014 53.00% 
       2015 20.00% 
       2016 20.00% 
       2017 20.00%
Pre tax discount rate:      All years 6.67%
Income tax rate:      All years 25.00%
The key assumptions used to prepare the ﬁnancial budgets are based on a combination of historical experience and current industry knowledge 
and trends.
The cash ﬂow forecasts used in the value in use calculations have not been extended beyond the ﬁve year period covered by management’s 
ﬁnancial budgets.
Incorporating the above assumptions the value of the expected goodwill to be realised in future periods has diminished to the eﬀect of 
£1,186,516 (2011: Nil) and therefore this has been reﬂected in the value of goodwill carried forward by way of an impairment. See note 13 for 
further details. www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
46
11. Intangible Assets
Group
    Computer Development Domain 
    software costs names Totals 
    £ £ £ £
Cost 
At 1st July 2011    147,955 1,209,923 12,971 1,370,849 
Additions    51,329 1,118,538 3,000 1,172,867
At 30th June 2012    199,284 2,328,461 15,971 2,543,716
Amortisation 
At 1st July 2011    65,180 307,715 7,397 380,292 
Amortisation for year     46,766 360,192 3,409 410,367
At 30th June 2012    111,946 667,907 10,806 790,659
Net book value 
At 30th June 2012    87,338 1,660,554 5,165 1,753,057
 
    Computer Development Domain 
    software costs names Totals 
    £ £ £ £
Cost 
At 1st July 2010    125,301 579,540 8,836 713,677 
Additions    22,654 630,383 4,135 657,172
At 30th June 2011    147,955 1,209,923 12,971 1,370,849
Amortisation 
At 1st July 2010    32,825 117,280 4,490 154,595 
Amortisation for year     32,355 190,435 2,907 225,697
At 30th June 2011    65,180 307,715 7,397 380,292
Net book value 
At 30th June 2011    82,775 902,208 5,574 990,557
       
Development cost additions represents resources the Group have invested in the development of new innovative and ground breaking 
technology products for marketing professionals. This platform allows marketing professionals to create, send and automate marketing 
campaigns. Following development of the products the Group intends to licence the use of the platform.
 
12. Property, Plant and Equipment
Group
     Fixtures 
   Short Plant and and Computer 
   leasehold machinery ﬁttings equipment Totals 
   £ £ £ £ £
Cost 
At 1st July 2011    11,875 8,536 174,945 418,140 613,496 
Additions   - - 17,321 297,467 314,788 
Disposals   - (5,794) - - (5,794)
At 30th June 2012    11,875 2,742 192,266 715,607 922,490
Depreciation 
At 1st July 2011    10,126 3,482 119,726 242,038 375,372 
Charge for year    864 2,026 24,573 119,242 146,705 
Eliminated on disposal   - (3,982) - - (3,982)
At 30th June 2012    10,990 1,526 144,299 361,280 518,095
Net book value 
At 30th June 2012    885 1,216 47,967 354,327 404,395
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
47
12. Property, Plant and Equipment continued
     Fixtures 
   Short Plant and and Computer 
   leasehold machinery ﬁttings equipment Totals 
   £ £ £ £ £
Cost 
At 1st July 2010    11,875 5,577 144,974 290,446 452,872 
Additions   - 2,959 29,971 127,694 160,624
At 30th June 2011    11,875 8,536 174,945 418,140 613,496
Depreciation 
At 1st July 2010    9,100 1,719 93,719 175,215 279,753 
Charge for year    1,026 1,763 26,007 66,823 95,619
At 30th June 2011    10,126 3,482 119,726 242,038 375,372
Net book value 
At 30th June 2011    1,749 5,054 55,219 176,102 238,124
13. Investments
Company
       Shares in 
       Group 
       undertakings 
           £
Cost 
At 1st July 2011       8,704,468
Amortisation 
Impairment (see note 13)       1,193,438
At 30th June 2012       1,193,438
Net book value 
At 30th June 2012       7,511,030
 
       Shares in 
       Group 
       undertakings 
           £
Cost 
At 1st July 2010
and 30th June 2011       8,704,468
Net book value 
At 30th June 2011       8,704,468
At 30th June 2010       8,704,468
 
The Group or the Company’s investments at the balance sheet date in the share capital of companies include the following: 
Subsidiaries
dotMailer Limited 
Nature of business: Web and email based marketing 
       Proportion of voting  
Class of shares:       power held %
Ordinary       100.00
Ordinary A       100.00
      30.6.12 30.6.11 
      £ £
Aggregate capital and reserves      7,530,683 4,872,612
Proﬁt for the year      2,658,071 2,008,026 www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
48
13. Investments continued
dotAgency Limited 
Nature of business: Dormant 
       Proportion of voting 
Class of shares:       power held %
Ordinary       100.00
      30.6.12 30.6.11 
      £ £
Aggregate capital and reserves      1,000 1,000
Company
dotCommerce Limited 
Nature of business: Dormant 
       Proportion of voting 
Class of shares:       power held %
Ordinary       100.00
      30.6.12 30.6.11 
      £ £
Aggregate capital and reserves      1,000 1,000
dotEditor 
Nature of business: Dormant 
       Proportion of voting 
Class of shares:       power held %
Ordinary       100.00
      30.6.12 30.6.11 
      £ £
Aggregate capital and reserves      1,000 1,000
  
dotSEO 
Nature of business: Dormant 
       Proportion of voting 
Class of shares:       power held %
Ordinary       100.00
      30.6.12 30.6.11 
      £ £
Aggregate capital and reserves      1,000 1,000
  
dotSearch (previously known as Netcallidus) Limited 
Nature of business: Internet and website services 
       Proportion of voting 
Class of shares:       power held %
Ordinary, B, C & D       100.00
      30.6.12 30.6.11 
      £ £
Aggregate capital and reserves      499,549 297,677
Proﬁt for the year      201,872 207,095
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
49
13. Investments continued
Below are the Parent Company’s indirect holdings:
Indirect Holding 
dotSearch Europe (previously known as Netcallidus Europe) Limited 
Country of incorporation: England and Wales 
Nature of business: Branch Company 
       Proportion of voting 
Class of shares:       power held %
Ordinary       100.00
      30.6.12 30.6.11 
      £ £
Aggregate capital and reserves      (33,275) (3,566)
Proﬁt for the year      (29,709) (4,566)
 
On 17th May 2010 the Group acquired the entire share capital of dotSearch (previously known as Netcallidus) Limited a company registered 
in England and Wales for an initial consideration of £1,152,660 and which had an additional contingent consideration of £2,366,320 totalling 
£3,518,980. The Group’s principal activity is the provision of internet and website services. Obtaining control of dotSearch (previously known as 
Netcallidus) Limited allows the Group to incorporate the customer base in to its own while providing additional expertise to further develop and 
market its SEO products.
The following summarises the major classes of consideration transferred and the recognised amounts of assets and liabilities assumed at the 
acquisition date:
       Discounted 
        fair value 
Consideration transferred:       £
Cash       1,000,000 
Equity instruments (14,200,930 shares)       152,660
       1,152,660
 
The number of shares issued in respect of the consideration transferred was based on 1.075p per share* which was the mid-market price as at  
30th June 2010. 
* Pre 1 for 5 share consolidation in February 2011.
Identiﬁable assets acquired and liabilities assumed:
       Book and Fair 
       Value 
       £
Goodwill       45,000 
Property, plant and equipment       2,532 
Trade and other receivables       88,349 
Deposits, cash and cash equivalents       41,407 
Taxation       (84,598) 
Trade and other payables       (40,768)
Net assets       51,922
 
Goodwill:
       £
Purchase consideration:       3,518,980 
Fair value of net assets acquired       51,922
Goodwill acquired        3,467,058 
Goodwill acquired from purchase of subsidiary       45,000
       3,512,058
The acquisition related costs related to external legal fees and due diligence fees totalling £66,163 have been included in administrative expenses 
in the consolidated statement of comprehensive income for the previous reporting period.
The contingent consideration arrangement required the Group to pay the former owners of dotSearch (previously known as Netcallidus) Limited 
additional consideration in a combination of cash and equity in the Group. As made reference to in the previous year’s ﬁnancial statements an 
interim payment was due to be made on ﬁnalising the proﬁt after tax ﬁgures based on 4 times the proﬁt after tax in the year ended 30th June 
2012 less any amounts that had been paid previously.  www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
50
13. Investments continued
On 24th November 2011, the Board of Directors presented an early settlement package to the pre-existing shareholders of dotSearch (previously 
known as Netcallidus) Limited which consisted of the payments made previously and an additional cash settlement of £164,100 which was 
accepted unanimously. With the acceptance of the package all remaining contingent consideration previously provided for in the ﬁnancial 
statements, totalling £1,079,392 has been written to the income statement as ﬁnance income in accordance with IFRS 3 regarding business 
combinations.
The level of after tax proﬁts generated from this investment as at the date above and as at 30th June 2012, was lower than expected based on 
the Vendor’s forecast at the time of the acquisition which needed to be used under IFRS 3 to determine the contingent consideration that may 
have been payable, under the conditions of accounting standard IAS38 it has resulted in an impairment to the value of goodwill generated on the 
acquisition of £1,186,516 which also has been charged to the income statement.
The net eﬀect on the income statement of both the ﬁnancial income and the impairment of the investment has resulted in a charge of £107,124.
 
14. Trade and Other Receivables
    Group  Company
    30.6.12 30.6.11  30.6.12 30.6.11 
    £ £ £ £
Current:  
Trade receivables    1,950,066 1,452,776 - - 
Other receivables    18,054 34,630 - - 
VAT     - - - 11,739 
Prepayments and accrued income    230,172 170,638 12,684 14,007
    2,198,292 1,658,044 12,684 25,746
15. Cash and Cash Equivalents
    Group  Company
    30.6.12 30.6.11  30.6.12 30.6.11 
    £ £ £ £
Cash in hand    43 394 - -
Bank accounts    4,020,306 2,567,871 83,293 235,274
    4,020,349 2,568,265 83,293 235,274
16. Called up Share Capital
Allotted, issued and fully paid
    Class Nominal 30.6.12 30.6.11 
    Number value £ £
275,362,065 
(2011: 274,972,065)    Ordinary £0.005 1,376,811 1,374,861
      1,376,811 1,374,861
 
The holders of Ordinary shares are entitled to receive dividends as declared from time to time, and are entitled to one vote per share at meetings 
of the Company.
During the reporting period the Company undertook the following transactions involving the issuing and reclassifying issued share capital:
On 13th March 2012 a number of employees exercised their share options increasing the issued share capital by 190,000 shares issued at  
premium price of 5p. 
On 22nd June 2012 a number of employees exercised their share options increasing the issued share capital by 200,000 shares issued at premium 
price of 5p. 
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
51
17. Reserves
Group
   Retained Share Revaluation Other 
   earnings premium reserve reserves Totals 
   £ £ £ £ £
At 1st July 2011    5,734,342 4,737,053 (4,695,465) 70,160 5,846,090 
Proﬁt for the year    2,467,475 - - - 2,467,475 
Cash share issue   - 17,800 - - 17,800 
Share based payment   - - - 57,183 57,183
At 30th June 2012    8,201,817 4,754,853 (4,695,465) 127,343 8,388,548
 
Group
       Unissued 
     Retained Share share 
     earnings premium capital 
     £ £ £
At 1st July 2010     2,696,522 4,533,754 152,660 
Proﬁt for the year     3,037,820 -       - 
Cash share issue     - 65,533 - 
Reclassiﬁcation of equity     - 137,766 (152,660)
At 30th June 2011     5,734,342 4,737,053 -
 
Group
     Reverse 
     acquisition Other 
     reserve reserves Totals 
     £ £ £
At 1st July 2010     (4,695,465) 29,493 2,716,964 
Proﬁt for the year        3,037,820 
Cash share issue     - - 65,533 
Share based payment     - 40,667 40,667 
Reclassiﬁcation of equity     - - (14,894)
At 30th June 2011     (4,695,465) 70,160 5,846,090
 
Company
    Retained Share Other 
    earnings premium reserves Totals 
    £ £ £ £
At 1st July 2011     498,060 4,737,053 70,160 5,305,273 
Proﬁt for the year    (368,997) - - (368,997) 
Cash share issue    - 17,800 - 17,800 
Share based payment    - - 57,183 57,183 
Reclassiﬁcation of equity    - - - -
At 30th June 2012     129,063 4,754,853 127,343 5,011,259
18. Trade and Other Payables
    Group  Company
    30.6.12 30.6.11 30.6.12 30.6.11 
    £ £ £ £
Current:  
Trade payables    224,097 204,894 27,326 71,516 
Amounts due to related parties (see note 24)    - - 1,155,443 926,596 
Social security and other taxes     328,828 272,669 - - 
Other payables    141,582 33,404 -  
Accruals and deferred income    160,740 183,042 34,000 43,750 
VAT     479,334 313,734 2,168 -
    1,334,581 1,007,743 1,218,937 1,041,862 www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
52
19. Financial Liabilities - Borrowings 
    Group  Company
    30.6.12 30.6.11 30.6.12 30.6.11 
    £ £ £ £
Current 
Bank loans    - 6,076 - -
    - 6,076 - -
Non-current:
Contingent consideration    - 1,243,492 - 1,243,492
    - 1,243,492 - 1,243,492
Included in the prior year non-current other ﬁnancial liabilities is the present value of the contingent consideration due on the purchase of 
the entire share capital of dotSearch (previously known as Netcallidus) Limited. During the year the pre-existing share holders of dotSearch 
(previously known as Netcallidus) Limited accepted a ﬁnal cash settlement of £164,100 resulting in an excess contingent consideration provision 
of £1,079,392 which has been take to the income statement as an exceptional item, see note 13 for further information.
 
20. Leasing Agreements
Minimum lease payments under non cancellable operating leases fall due as follows
      30.6.12
     Land and Buildings Other Total  
     £ £ £
Within one year     66,496 40,465 106,961 
Between two to ﬁve years     - 26,293 26,293
     66,496 66,758 133,254
      30.6.11
     Land and Buildings Other Total  
     £ £ £
Within one year     134,928 39,774 174,702 
Between two to ﬁve years     33,155 27,928 61,083
     168,083 67,702 235,785
 
21. Financial Instruments
The Group’s activities expose it to a number of ﬁnancial risks that include credit risk, liquidity risk and cash ﬂow interest rate risk. These risks, and 
the Group’s policies for managing them have been applied consistently throughout the year and are set out below:
The Group hold no ﬁnancial or non other ﬁnancial instruments other than those utilised in the working operations of the Group and that listed in 
this note.
Interest Rate Risk
The Group’s interest rate risk arises from interest bearing assets and liabilities. The Group has in place a policy of maximising ﬁnance income by 
ensuring that cash balances earn a market rate of interest; oﬀsetting where possible, cash balances and by forecasting and ﬁnancing its working 
capital requirements. As at the end of the reporting period the Group was not exposed to any movement in interest rates in regard to loans and 
achieved less than 1% interest on cash holdings.
The term “shares” indicates the value of ordinary share capital to be issued should targets be met and discount factors not change. Any changes 
resulting in revaluations of the consideration due in following reporting periods will be charged to the income statement.
The Group’s working capital requirements are managed through regular monitoring of the overall cash position and regularly updated cash ﬂow 
forecasts to ensure there are suﬃcient funds available for its operations.
Liquidity Risk
The Group’s working capital requirements are managed through regular monitoring of the overall position and regularly updated cash ﬂow 
forecasts to ensure there are funds available for its operations. Management forecasts indicate no new borrowing facilities will be required in the 
upcoming ﬁnancial period.
Credit Risk
Credit risk arises principally from the Group’s trade receivables which comprise amounts due from customers. Prior to accepting new customers a 
credit check is obtained. As at 30th June 2012 there were no signiﬁcant debts pass their due period which had not been provided for. The maturity 
of the Groups trade receivables is as follows:
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
53
21. Financial Instruments continued
      As at  As at  
      30.06.12 30.06.11 
      £ £
0-30 days      1,424,999 1,030,966
30-60 days      20,306 268,425
More than 60 days      504,761 188,475
      1,950,066 1,487,866
The Group minimises its credit risk by proﬁling all new customers and monitoring existing client of the Group for changes in their initial proﬁle. The level 
of trade receivables passed due the average collection period consisted of a value of £522,814 of which £211,333 was provided for. The Group felt that the 
remainder would be collected post year end as they were with long standing relationships, the risk of default is considered to be low and write oﬀs due to 
bad debts are extremely low. The Group has no signiﬁcant concentration of credit risk, with the exposure spread over a large number of customers.
The credit risk on liquid funds is low as the counterparts are banks with high credit ratings assigned by international credit ratings.
Details as to maximum fair values the Group’s ﬁnancial assets and liabilities can be found in the consolidated statement of ﬁnancial position.
Capital Policy
The Group’s objectives when managing capital are to safeguard its ability to continue as a going concern in order to provide optimal returns  
for shareholders and to maintain an eﬃcient capital structure to reduce the cost of capital.
In doing so the Group’s strategy is to maintain a capital structure commensurate with a strong credit rating and to retain appropriate levels of 
liquidity headroom to ensure ﬁnancial stability and ﬂexibility. To achieve this, the Group monitors key credit metrics, risk and ﬁxed charge cover  
to maintain this position. In addition the Group ensures a combination of appropriate short term and long term liquidity headroom.
During the year the Group had a short term loan balance of £nil (2011- £6,072) and amounts payable over one year are nil. The Group had a  
strong cash reserve to utilise for any short term capital requirements that were needed by the Group.
The Group has continued to look for a further long term investments or acquisitions and therefore to maintain or re-align the capital structure,  
the Group may adjust when dividends are paid to shareholders, return capital to shareholders, issue new shares or borrow from lenders.
 
22. Deferred Tax
       30.6.12 
       £
At 30th June 2011       -
Current year provision       24,616
At 30th June 2012       24,616
23. Capital Commitments
The Company and Group have no capital commitments as at the year end.
 
24. Related Party Disclosures
Group
The following transactions were carried out with related parties 
       30.06.12 30.06.11 
Sale of services      £ £
Codence performance  Entity   Email 
   under common   marketing 
   directorship  services  42 -
      42 -
 
Sales of services are based on the price lists in force and at terms that would be available to third parties.
      30.06.12 30.06.11 
Purchase of services      £ £
Haggie Financial LLP* Entity under common directorship Financial PR - 5,155
Nexus Financial LLP* Entity under common directorship Financial PR - 20,709
Hansard Communications Ltd* Entity under common directorship Financial PR - 2,621
F Beechinor-Collins** Entity under common directorship Consultancy services 53,913 -
      53,913 28,485
*     N Nelson a non-Executive Director of the Group had interests in the above companies. These companies provide ﬁnancial public relation services to the Group.
**  Consultancy services to assist with international expansion and development of channel sales strategy. www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
54
24. Related Party Disclosures continued
       30.06.12 30.06.11 
Year end balances arising from sales/purchases of services     £ £
Hansard Communications Ltd Entity under common directorship Payables - 2,261
F Beechinor- Collins Entity under common directorship Payables (2,656) -
 
The receivables and payables are unrestricted in nature and bear no interest. No provision’s are held against receivables from related parties.
Key management compensation
Key management includes directors, non-executive directors and the Company secretary. The compensation paid for key management for 
employee services are shown below
      30.06.12 30.06.11 
      £ £
Remuneration and other short term employee beneﬁts     911,113 842,523
Share-based payments      10,168 7,821
      921,281 850,344
 
      30.06.12 30.06.11 
Directors      £ £
Aggregate emoluments      602,290 778,988
Aggregate gains on exercise of share options      - 483,333
Company contributions to money purchase pension scheme     47,510 34,013
      649,800 1,296,334
 
Information in relation to the highest paid Director is as follows:
      30.06.12 30.06.11 
      £ £
Salaries      156,000 163,500
Other beneﬁts      843 757
Pension costs      11,000 10,458
      167,843 174,715
 
Company
The following transactions were carried out with related parties
      30.06.12 30.06.11 
Purchase of services      £ £
Haggie Financial LLP*  Entity under common directorship Financial PR - 5,155
Nexus Financial LLP*  Entity under common directorship Financial PR - 20,709
Hansard Communications Ltd*  Entity under common directorship Financial PR - 2,621
      - 28,485
* N Nelson a non-Executive Director of the Group had interests in the above companies. These companies provide ﬁnancial public relation services to the Group.
      30.06.12 30.06.11 
Year end balances arising from sales/purchases of services     £ £
Hansard Communications Ltd Entity under common directorship Payables - 2,261
dotMailer Limited Subsidiary Payables 1,165,930 926,596
dotSearch Limited Subsidiary Receivable 10,217 -
 
The receivables and payables are unrestricted in nature and bear no interest. No provision’s are held against receivables from related parties.
Key Management Compensation
Key management includes Directors, non-Executive Directors and the Company Secretary. The compensation paid for key management for 
employee services are shown below
      30.06.12 30.06.11 
      £ £
Remuneration and other short term employee beneﬁts     84,805 42,917
      84,805 42,917
 
      30.06.12 30.06.11 
Directors      £ £
Aggregate emoluments      84,805 42,917
      84,805 42,917
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 
FOR THE YEAR ENDED 30TH JUNE 2012 dotDigital Group Plc  
Annual Report and Accounts 2011/2012 
55
25. Ultimate Controlling Party
There is no ultimate controlling party of the Group. dotDigital Group PLC acts as the Parent Company to dotMailer Limited, dotSearch (previously 
known as Netcallidus) Limited, dotAgency Limited (Dormant), dotSEO Limited (Dormant), dotCommerce Limited (Dormant) & dotEditor Limited 
(Dormant). The Company also indirectly controls dotSearch Europe (previously known as Netcallidus Europe) Limited.
 
26. Share-based Payment Transactions
The measurement requirements of IFRS 2 have been implemented in respect of share options that were granted after 7th November 2002. The 
expense is recognised for share based payments made during the year is £57,183 (2011- £40,667)
Also on 13th October 2011 the Board of Directors also granted 8,177,930 (2011: 6,800,000) options to employees of the Group exercisable on or  
after 1st May 2012 until 1st February 2016. Vesting conditions of the options dictate that employees must remain in the employment of the Group  
for the whole period to qualify.
Movement in issued share options during the year
The table illustrates the number and weighted average exercise price (WAEP) of, and movements in share options during the period
    30.6.12  30.6.11
    No of options WAEP No of options WAEP
Outstanding at the beginning of the period    11,722,000 5.00p 18,785,333 1.35p 
Granted during the year    8,177,930 6.54p 6,800,000 5.00p 
Forfeited/cancelled during the period    1,600,000 6.54p 370,000 5.00p 
Exchanged for shares    390,0 00  13,493,333  
Outstanding at the end of the period    17,909,930 7.25p 11,722,000 4.22p 
Exercisable at the end of the period    Nil  Nil 
The weighted average exercise price (WAEP) in regards to the comparatives have been restated to reﬂect the share consolidation undertaken in 
February 2010.
The fair value of the options granted in the year have been calculated using the Black Scholes model assuming the inputs shown below:
Grant date 13th October 2011
Number of options granted       8,177,930 
Share price at grant date       6.53p 
Exercise price at grant date       7.25p 
Risk free rate       2.43% 
Option life       4.25 
Expected volatility       7.83% 
Expected dividend yield       0% 
Fair value of option       0.33p
27. Group Reconciliation of Profit before Income Tax to Cash Generated from Operations 
      30.6.12 30.6.11 
      £ £
Proﬁt before income tax      2,773,460 3,311,563 
Exceptional item: impairment of goodwill      1,186,516 - 
Depreciation charges      557,072 321,318 
Loss on disposal of ﬁxed assets      1,175 - 
Share based payment      57,183 40,667 
Finance costs      682 1,468 
Finance income      (1,087,837) (1,127,862)
      3,488,251 2,547,154
Increase in trade and other receivables      (540,248) (423,399) 
Increase in trade and other payables      326,838 338,979
Cash generated from operations       3,274,841 2,462,734
   www.dotdigitalgroup.com 
Annual Report and Accounts 2011/2012
56
28. Group Cash and Cash Equivalents
The amounts disclosed on the statement of cash ﬂow in respect of cash and cash equivalents are in respect of these statement of ﬁnancial 
position amounts: 
      30.6.12 1.7.11 
Year ended 30th June 2012      £ £
Cash and cash equivalents      4,020,349 2,568,265
      4,020,349 2,568,265
 
      30.6.11 1.7.10 
Year ended 30th June 2011      £ £
Cash and cash equivalents      2,568,265 1,277,617
  
29. Company Reconciliation of Profit/(Loss) before Income Tax to Cash Generated from Operations 
      30.6.12 30.6.11    
      £ £
Proﬁt /(Loss) before income tax      (368,977) 827,265
Exceptional item: impairment of goodwill      1,193,438 -
Share options      57,183 40,667
Finance income      (1,079,392) (1,122,828)
      (197,768) (254,896)
Increase in trade and other receivables      1,323 (9,181)
Increase in trade and other payables      (40,033) 6,488
Cash generated from operations       (236,478) (257,589)
30. Company Cash and Cash Equivalents
The amounts disclosed on the statement of cash ﬂow in respect of cash and cash equivalents are in respect of this statement of ﬁnancial position 
amounts: 
      30.6.12 1.7.11 
Year ended 30th June 2012      £ £
Cash and cash equivalents      83,293 235,274
 
       30.6.11 1.7.10 
Year ended 30th June 2011      £ £
Cash and cash equivalents      235,274 385,332
31. Research & Development
During the period the Group incurred nil (2011: nil) in research costs and £1,118,538 (2011- £630,383) in development investments. All resources 
utilised in research and development has been categorised as outlined in the accounting policy governing this area.
 
32. Post balance Sheet Events
There are no post balance sheet events which impact the Group’s ﬁnancial statements.
 
33. Prior Period Adjustment
On 1st July 2011 the Board of Directors re categorised the nature of some expenditure items from administrative to cost of sales. The impact of this 
on the comparative ﬁgures on the income statement are as follows:
     30.06.11 Eﬀect of  30.06.11 
      change (restated) 
     £ £ £
Continuing operations
Revenue     8,952,488 - 8,952,488
Cost of Sales     - (647,142) (647,142)
Gross profit     8,952,488 - 8,305,346
Administrative expenses     (6,647,493) 647,142 (6,000,351)
Operating profit before exceptional items     2,304,995 - 2,304,995
Profit for the year     3,037,820 - 3,037,820
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS CONTINUED 
FOR THE YEAR ENDED 30TH JUNE 2012 Design and production by Philosophy 
www.philosophydesign.com
Print by Moore Print
www.mooreprint.co.uk
Directors
S Bird 
P A Simmonds 
I Taylor 
G Fidura 
R Kellett-Clarke  
F Beechinor-Collins
Secretary 
M Patel
Registered Office 
Finsgate 
5-7 Cranwood Street 
London 
EC1V 9EE
Registered Number
06289659 (England and Wales)
Auditors 
Jeﬀreys Henry LLP 
Finsgate  
5-7 Cranwood Street 
London 
EC1V 9EE
Solicitors 
BPE Solicitors LLP 
St James House 
St James Square 
Cheltenham 
GL50 3PR
Principal Bankers 
National Westminster Bank plc 
Charing Cross, London Branch 
PO Box 113 
Cavell House 
2a Charing Cross Road 
London 
WC2H 0PD
Registrars  
Share Registrars Limited 
Suite E First Floor 
9 Lion and Lamb Yard 
Farnham 
Surrey 
GU9 7LL
Nomad/Broker 
Zeus Capital 
3 Ralli Courts 
West Riverside 
Manchester 
M3 5FT
Joint Broker  
Charles Stanley 
131 Finsbury Pavement 
London 
EC2A 1NT 
Website 
www.dotdigitalgroup.com
COMPANY INFORMATION
Croydon
No. 1 Croydon 
12-16 Addiscombe Road 
CR0 0XT 
 
T: 020 8662 2762
Manchester
Pall Mall Court 
61-67 King Street 
Manchester 
M2 4PD  
 
T: 0161 618 1070
London Bridge
6-8 Emerson Street 
London 
SE1 9DU 
 
T: 020 7654 8686
Edinburgh
MWB Business Exchange 
9-10 St Andrews Square 
Edinburgh 
EH2 2AF 
 
T: 0131 718 6037 WWW.DOTDIGITALGROUP .COM