Osmetech Annual Report 2004    xx
Osmetech plc
Annual Report and Accounts 2004 xx    Osmetech Annual Report 2004  
Osmetech today
Osmetech is a fast developing and well funded international diagnostics
business targeting the high growth point of care sector. The acquisition
of the OPTI range of blood gas analysers in April 2003 from Roche
marked a transformation of the business by providing a profitable and
high quality revenue base. This has created a strong platform from
which the Group’s exciting pipeline of new products can be developed.
Based in Atlanta, US, OPTI has also provided an excellent operational
infrastructure which together with a strong international distributor
network is capable of supporting the Osmetech’s future growth.
Contents
1 Highlights
2 Chairman’s statement
3 Chief Executive Officer’s review
7 Board of directors
8 Report of the directors
12 Independent auditors’ report
13 Consolidated profit and loss account
13 Consolidated statement of total recognised gains and losses
14 Consolidated balance sheet
15 Company balance sheet
16 Consolidated cash flow statement
16 Reconciliation of net cash flow to movement in net funds
17 Notes to the consolidated cash flow statement
19 Notes forming part of the financial statements
32 Notice of annual general meeting
Form of proxy
Directors and advisers Osmetech Annual Report 2004    1
Highlights
• Sales revenues well ahead of expectations at £6.2m.
• Loss before tax substantially reduced to £1.3m (2003 – £3.8m)
• Well funded Group with £3.2m in cash and term deposits at 30 April 2004
• Significant improvement in commercial and financial risk profile
• Five new OPTI products scheduled for launch in the coming year
• Good progress with development of vaginal infection product
• Important long term agreements signed with IDEXX for veterinary market
• Excellent growth prospects 2 Osmetech Annual Report 2004  
During the last financial year Osmetech has made significant advances
with its strategy to develop a medical devices and diagnostics business in
the fast growing point of care market.  As a result of the successful
acquisition of the OPTI product line of blood gas analysers from Roche,
the Group’s risk profile improved substantially and the business is now
well funded with over £3m of cash and term deposits at the year end.
Chairman’s statement
The first full year of trading of the OPTI product line has exceeded our expectations at all levels.
Now fully integrated, this business provides a sound and profitable commercial base for the
Group.  There are clear organic growth plans for OPTI which will commence in the second half of
the coming financial year following the launch of three key new products and the start of the
important trading relationship with IDEXX in the veterinary market.
The OPTI business has provided us with an excellent platform from which we can develop other
opportunities within the Group, notably the vaginal infection product scheduled for the next
calendar year.  The experience of the OPTI management team and the proven development and
engineering capabilities will be very valuable in this process of bringing new products through to
market.
I am delighted to welcome Alfred Marek to the Board. Alfred joined Osmetech from Roche at the
time of the OPTI acquisition and is President of Osmetech’s Critical Care Division based in Atlanta.
Previously with AVL he was instrumental in developing their entire blood gas business prior to its
sale to Roche.
This strengthening of the management team comes at an important time for the Group as it seeks
to grow both organically and through continued strategic acquisitions.
Gordon Hall
Chairman
5 August 2004 Osmetech Annual Report 2004    3
Chief Executive Officer’s review
Introduction
During the course of this financial year the Group has been successfully transformed from a pre-
revenue technology development operation to an international diagnostics business through the
ground breaking OPTI acquisition. The highly reliable revenue streams from OPTI have exceeded our
expectations and provide a solid base from which the business can develop its exciting opportunities
for further growth. The acquisition has substantially improved the financial and commercial risk
profile for Osmetech as it is now able to pursue its strategy for growth from a position of strength.
The market
The global medical diagnostics market is worth approximately $20bn and growing steadily, with
Osmetech positioned in the fast growing point of care (POC) market segment. Annual double digit
percentage growth is expected to continue in this sector as healthcare operators increasingly
demand faster test results.
The OPTI business operates in the POC arterial blood gas market which has experienced high
growth over recent years as testing migrates from traditional central hospital laboratory settings.
Osmetech’s vaginal infection product, currently under development, will also target similar POC
markets where there is a significant unmet need for improved infectious disease testing.
Business structure
Following the successful integration of the OPTI acquisition we have been able to consolidate the
Group’s operations on to the Atlanta site, where we have an excellent 60,000 sq ft facility capable
of supporting the anticipated growth of the business. 
The development of the vaginal infection product is now directly benefiting from the considerable
experience and expertise of the OPTI team. These benefits span the full commercial progression
from product development through to clinical, regulatory, production, sales and marketing
operations. Both products have similar customer bases and we intend to use OPTI’s strong
international network of distributors to gain access to all significant world markets.
OPTI trading
Sales revenues for the first full year of trading of $10.5m (£6.2m) far exceeded our original
expectations. These revenues include approximately $1m (£0.6m) of SARS-related sales to China
during the first half of the year.
New instrument sales accounted for 33% of total revenues with over 800 new analyser instruments
sold during the year. The active installed base of over 4,000 instruments with customers provides
robust and reliable demand for our proprietary consumables that are necessary in order to perform
the tests. This high quality stream of consumable sales revenues amounted to 65% of total sales
and should steadily grow as the installed base of instruments widens and further advances are
made with initiatives to increase the average number of tests per instrument.
OPTI’s self contained optical sensor cassette for
blood gas, electrolyte and metabolite analysis
Over 1.3 million consumable tests sold in 2003/4
representing 65% of total OPTI sales and a highly
reliable source of revenue. 4 Osmetech Annual Report 2004  
Chief Executive Officer’s review continued
New OPTI products
We remain on target to introduce five new products during the coming year, the first three of
which, including the new Critical Care Analyser with colour touch screen, were launched at the
recent American Association of Clinical Chemists Conference (AACC) in Los Angeles. Two further
key products are expected to be introduced in the second half of the year and should provide the
basis for substantial revenue growth both through the sale of new instruments and consumable
revenues for the growing installed base. We believe that much of this new business will be
incremental as we will be able to offer products aimed at reducing the cost per test for both the
higher usage customer and those operators only requiring a narrow range of tests.
IDEXX agreement
We have recently entered into an OEM manufacturing and supply agreement with IDEXX
Laboratories, Inc, a worldwide leader in the development and commercialisation of animal health
diagnostic products. In 2003, IDEXX had sales of $475m and have a current market capitalisation of
approximately $1.8bn. This long term commercial relationship should provide a substantial level of
new business for OPTI in both instruments and consumables thereby allowing us to benefit from
leveraging our highly scaleable manufacturing infrastructure in Atlanta.
We have also entered into a development and supply contract with IDEXX to create a new
platform for measuring critical care parameters based on Osmetech’s proprietary optical
fluorescence technology.
Both contracts will span over a period of at least 10 years and will open the veterinarian market for
Osmetech’s technology and products. 
This relationship is not only a further validation of the OPTI technology but also demonstrates
Osmetech’s ability to scale up its manufacturing efficiently and become a top quality provider of
critical care diagnostic instrumentation.
Vaginal Infection Product
The increasing spread of sexually transmitted diseases (STDs) continues to be of major concern in
all markets worldwide. The Centre for Disease Control has reported that 15 million people are
diagnosed annually with an STD. In the ten year period to 2002, the NHS in the UK reported that
the number of STD patients doubled, with 1 in 10 of the entire UK adult population now estimated
to be infected with Chlamydia.
Current diagnostic practice is unable to provide results in a timely manner that would allow the
early commencement of appropriate treatment that could provide improved control over the
further spread of infection in the community. There is a clear unmet need for a simple and
objective test for the most common and clinically important vaginal infections that is capable of
delivering results within the time period of a normal patient visit.
The portable OPTI CCA analyser
Over 800 new OPTI CCA instruments sold in 2003/4
increasing the active installed base of units to over
4,000 from which repeat consumable sales
will be generated. Osmetech Annual Report 2004    5
300
250
200
150
100
50
0 1999 2000 2001 2006
Chief Executive Officer’s review continued
Good progress has continued to be made with the development of a device capable of satisfying
this market requirement. The device’s automated testing process has been clinically tested and has
provided results comparable to the manual methods currently used. This is an important step and
the tests will now be optimised further and combined within the single platform device prior to the
commencement of clinical trials. FDA regulatory approval for the combined device will be required
prior to launch in the US in 2005.
Financial review
Sales revenues totalled $10,453,000 (£6,180,000), with 38% representing direct US sales and the
remainder through third party distributors serving other markets. In product terms, the highly
reliable repeat consumable sales accounted for 65% of total business revenues.
The gross profit margin was abnormally high at 55.8% reflecting the successful utilisation of slow
moving and redundant inventory acquired as part of the purchase of the OPTI business.
The profitable trading of OPTI together with the significant reduction in the cost base of the
remainder of the business has contributed to a substantial reduction in the loss for the year to
£1,168,000 (2003 – £3,667,000). Development costs associated with the new product introductions
will however increase in the coming year.
Cash outflows before financing at £2,084,000 were higher than the reported loss for the year,
reflecting the final payments of the deferred consideration of $795,000 (£422,000) for OPTI
together with an increase of £474,000 in trade debtors due to the growth of the business over the
full trading period.
Following the £2,000,000 placing to institutional investors in October 2003, the Group ended the year
with cash balances and term deposits of £3,172,000. This represents a strong cash position and we
are satisfied that the Group should have sufficient funds available to launch all of the new OPTI
products scheduled for the coming year through to the launch of the integrated vaginal infection
device.
All of OPTI’s sales revenues and the majority of its costs are dollar based. The surplus of dollars
that this generates broadly matches the dollar requirements for the rest of the Group.
Global Near Patient and Point of Care
Blood Gas Testing Market (revenues $m) 
The market segment has grown significantly in recent
years and is expected to grow at an annual rate of
13% over the 5-year period 2001-6 as more testing
moves away from the central laboratory setting 6 Osmetech Annual Report 2004  
Chief Executive Officer’s review
continued
Outlook
The relocation of Osmetech’s operational base to Atlanta has been extremely successful and our
thanks go to all our employees, old and new, for making this move and indeed this year as
productive and encouraging as it has been.
We have a high quality operational infrastructure capable of supporting the continued growth of
the business.  We expect to be able to build on the excellent performance of OPTI this year and
are confident of significant growth commencing in the second half of next year through the new
product introductions and the IDEXX relationship.
Osmetech is well placed in a fast growth market sector, with a strong commercial business base
and access to enabling technologies, including its proprietary electronic nose technology, capable
of meeting the market requirements for new products.  We will also continue to search for
opportunities through suitable acquisitions to further stimulate this growth.
James White
Chief Executive Officer 
5 August 2004 Osmetech Annual Report 2004 7
Board of directors
for the year ended 30 April 2004
Gordon James Hall
Non-Executive Chairman
Gordon Hall, aged 61, was Managing Director of Shield Diagnostic Group plc (now Axis-Shield plc) until October 1997 and prior to
this held senior positions at Abbott Laboratories. He was appointed to the Board as executive Chairman on 24 September 1998,
becoming non-executive Chairman on 1 February 2001.
James Nicholas Gerald White
Chief Executive Officer
James White, aged 33, was previously a senior consultant in Arthur D Little Ltd’s corporate finance practice, where he specialised
in advising venture capitalists on investments in small and medium sized companies. He was Operations Manager of Osmetech
from September 1998 until appointed to the Board as Chief Operating Officer on 1 October 1999. He was appointed Chief
Executive Officer on 22 December 2000.
David Anthony Sandilands
Chief Financial Officer
David Sandilands, aged 43, was Group Financial Director at Bluebird Toys plc, until its take-over by Mattel Inc. of the USA. 
Mr Sandilands qualified as a Chartered Accountant with Price Waterhouse and was appointed to the Board as Chief Financial
Officer on 1 July 1999.
Gordon Bruce Kuenster
Non-Executive
Gordon Kuenster, aged 70, has founded and developed major medical diagnostic companies. He was appointed Group Vice
President and a director of Squibb Corporation, following its acquisition of Advance Technology Laboratories Inc. He is Chairman
of UMD Technology Inc, a medical technology company. He was appointed to the Board on 3 February 1998 as Director of
Development and was appointed Chief Technology Officer on 1 October 1999, becoming a non-executive director on
3 September 2002.
Alfred Marek
Executive
Alfred Marek, aged 58, is President of Osmetech’s Critical Care Division based in Atlanta, having joined the Company at the time
of the OPTI acquisition in April 2003. He was previously with AVL and was instrumental in developing their entire blood gas
business prior to its sale to Roche in 2000. Mr Marek was appointed to the Board on 21 April 2004. 8 Osmetech Annual Report 2004
Report of the directors
for the year ended 30 April 2004
The directors submit their report together with the audited financial statements for the year ended 30 April 2004.
Results and dividends
The results of the Group for the year are set out on page 13.
The directors do not recommend the payment of a dividend (2003 – £Nil).
Principal activities, trading review and future developments
The principal activity of the Group is the design, development and manufacture of healthcare diagnostics and medical devices
incorporating sensing technology.
The principal activities of two of the subsidiaries, Osmetech Inc and Osmetech Technology Inc, are the same as Osmetech plc. The
principal activity of the third subsidiary, Osmetech AESOP Trustee Limited, is to act as a trustee to an employee share ownership
trust.
A review of the trading and future developments are dealt with fully in the accompanying Chairman’s statement and Chief
Executive Officer’s review.
Charitable and political contributions
The Group did not make any charitable or political contributions during the year.
Directors
The directors of the Company at 30 April 2004 and their interests, which were all held beneficially, in the ordinary share capital of
the Company at the balance sheet date were:
Ordinary shares of 1p each Ordinary shares of 1p each
30 April 2004 30 April 2003 (or date of
appointment if later)
Shares Options Shares Options
G J Hall 763,946 1,000,000 653,946 1,000,000
J N G White 1,509,500 25,120,000 2,289,500 25,120,000
D A Sandilands 330,263 12,500,000 330,263 12,500,000
G B Kuenster 330,540 3,350,000 330,540 3,350,000
A Marek (appointed 21 April 2004) 261,900 10,000,000 261,900 10,000,000
There have been no movements in the directors’ interests in the Company’s share capital between 30 April 2004 and 5 August
2004.
In accordance with the Articles of Association and, having been appointed since the date of the last Annual General Meeting, 
Mr A Marek retires and, being eligible, offers himself for election as a director at the Annual General Meeting to be held on 
23 September 2004. Mr Marek’s appointment is terminable by at least 12 months’ notice.
In accordance with the Articles of Association, Mr G J Hall and Mr G B Kuenster will retire by rotation and, being eligible, 
offer themselves for re-election. Mr Hall and Mr Kuenster do not have service agreements with the Company. Mr Hall’s and 
Mr Kuenster’s appointments are terminable by at least 12 months’ notice.
Directors’ interests in contracts
No director was, or is, materially interested in any contract subsisting during, or at the end of the financial year which was
significant in relation to the business of the Group. Osmetech Annual Report 2004 9
Report of the directors
continued
Substantial shareholdings
In addition to the directors’ shareholdings shown above, the directors have been notified or are aware of the following interests in
3 per cent. or more of the issued ordinary share capital of the Company as at 14 July 2004:
Shareholder Number of Shares Per cent
Barclayshare Nominees Limited 45,546,929 7.54
T D Waterhouse Nominees (Europe) Limited SMKTNOMS Account 34,498,187 5.71
Barnard Nominees Limited E I I L Account 31,333,333 5.18
HSBC Global Custody Nominee (UK) Limited 813259 Account 23,446,884 3.88
HSDL Nominees Limited 18,463,107 3.05
Compliance
As an AIM listed company, the Combined Code is not mandatory and the Company has therefore not produced a separate
Corporate Governance or Directors’ Remuneration Report.
Going Concern
Having reviewed the Group’s budgets and financial projections and after making due and careful enquiries, the directors have a
reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future.
The accounts, therefore, are prepared on a going concern basis.
Directors’ responsibilities
United Kingdom company law requires the directors to prepare financial statements for each financial year which 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 year. In preparing
those financial statements, the directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and estimates that are reasonable and prudent;
• state whether applicable accounting standards have been followed, subject to any material departures disclosed and
explained in the financial statements;
The directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time the
financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act
1985. They are also responsible for the system of internal control, for safeguarding the assets of the Company and hence for taking
reasonable steps for the prevention and detection of fraud and other irregularities.
The maintenance and integrity of the web site is the responsibility of the directors; the work carried out by the auditors does not
involve consideration of these matters and, accordingly, the auditors accept no responsibility for any changes that have occurred
to the information contained in the financial statements since they were initially presented on the web site. 10 Osmetech Annual Report 2004
Report of the directors
continued
Legislation in the United Kingdom governing the preparation and dissemination of the financial statements and other information
included in the annual reports may differ from legislation in other jurisdictions.
Supplier Payment Policy
The Company has due regard to the payment terms of suppliers and settles all undisputed accounts in accordance with the
payment terms agreed with the supplier for each business transaction. The Company had 18 days (2003 – 22 days) of purchases
outstanding at the end of the financial year.
CREST
The Company’s ordinary shares are eligible for settlement through CREST, the system for securities to be held and transferred in
electronic form rather than in paper. Shareholders are not obliged to use CREST and can continue to hold and transfer shares in
paper without loss of rights.
Independent Auditors
A resolution to reappoint Deloitte & Touche LLP as the Company’s auditor will be proposed at the Annual General Meeting.
Electronic Communications
The Company may deliver shareholder information including Annual and Interim Reports, Forms of Proxy and Notices of General
Meetings in an electronic format to shareholders. 
If you would like to receive shareholder information in electronic format, please register your request on the Company’s Registrar’s
electronic database at www.capitaregistrars.com. You will initially need your unique ‘investor code’, which you will find at the top of
your share certificate. There is no charge for this service. If you wish to subsequently change your mind, you may do so by
contacting the Company’s Registrars by post or through their web site.
If you elect to receive shareholder information electronically, please note that it is the shareholder’s responsibility to notify the
Company of any change to their name, address, e-mail address or other contact details. Shareholders should also note that, with
electronic communication, the Company’s obligations will be satisfied when it transmits the notification of availability of
information or such other document as may be involved to the electronic address it has on file. The Company cannot be held
responsible for any failure in transmission beyond its control any more than it can for postal failure. In the event of the Company
becoming aware that an electronic notification is not successfully transmitted, a further two attempts will be made. In the event
that the transmission is still unsuccessful a hard copy of the notification will be mailed to the shareholder. In the event that specific
software is required to access information placed on the Company’s website it will be available via the website without charge.
Before electing for electronic communications shareholders should ensure that they have the appropriate equipment and
computer capabilities sufficient for the purpose. The Company takes all reasonable precautions to ensure no viruses are present in
any communication it sends out but cannot accept responsibility for loss or damage arising from the opening or use of any e-mail
or attachments from the Company and recommends that shareholders subject all messages to virus checking procedures prior to
use. Any electronic communication received by the Company that is found to contain any virus will not be accepted.
Shareholders wishing to receive shareholder information in the conventional printed form will continue to do so and need take no
further action.
Should you have any further questions on this please contact the Company’s Registrars, Capita Registrars on 0870 162 3131. Osmetech Annual Report 2004 11
Report of the directors
continued
Annual General Meeting – Explanation of Special Business
Renewal of Authority to Allot Shares and Disapplication of Pre-emption rights (Resolutions 6 and 7)
Resolution 6
The directors may only allot shares or grant rights over shares if authorised to do so by shareholders. The general authority
granted at the annual general meeting held on 28 August, 2003 is due to expire at the annual general meeting in 2004.
Accordingly, Resolution 6 will be proposed as an ordinary resolution to grant a new authority to allot unissued share capital up to
an aggregate nominal value of £2,014,767, representing 33
1
/3 per cent. of the total issued ordinary share capital as at 5 August
2004. If given, this authority will expire at the earlier of (A) 31 October 2005 and (B) the conclusion of the annual general meeting in
2005. Other than in respect of the Company’s obligations under its employee share schemes the directors have no present
intention of utilising the authority set out in this resolution to issue any of the authorised but unissued share capital of the
Company. This authority, if granted, will be in addition to any other like authority to the extent not utilised at the time and date it is
granted.
Resolution 7
The directors also require additional authority from shareholders to allot shares or grant rights over shares where they propose to
do so for cash and otherwise than to existing shareholders pro rata to their holdings. The general authority granted at the annual
general meeting held on 28 August, 2003 is due to expire at the annual general meeting in 2004. Accordingly, Resolution 7 will be
proposed as a special resolution to grant such authority. If given, this power will expire at the earlier of (A) 31 October 2005 and (B)
the conclusion of the annual general meeting in 2005. Apart from rights issues, open offers and other pre-emptive issues, the
authority will be limited to the issue of shares up to an aggregate nominal value of £1,208,860 being 20 per cent. of the issued
ordinary share capital at 5 August 2004. This authority does not accord with IPC guidelines, but the directors regard the authority
as desirable to maximise the options open to the Company in the coming year. 
By order of the Board
S A Craig
Secretary
5 August 2004 12 Osmetech Annual Report 2004
Independent auditors’ report
Independent auditors’ report to the members of Osmetech plc
We have audited the financial statements of Osmetech plc for the year ended 30 April 2004, which comprise the consolidated
profit and loss account, the balance sheets, the consolidated cash flow statement, the reconciliation of net cash flow to movement
in net funds, notes to the consolidated cash flow statement, the consolidated statement of total recognised gains and losses and
the related notes 1 to 26. The financial statements have been prepared under the accounting policies set out therein.
This report is made solely to the Company’s members, as a body, in accordance with section 235 of the Companies Act 1985. Our
audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to them
in an auditors’ report and for no other purpose. 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 described in the statement of directors’ responsibilities, the Company’s directors are responsible for the preparation of the
financial statements in accordance with applicable United Kingdom law and accounting standards. Our responsibility is to audit the
financial statements in accordance with relevant United Kingdom legal and regulatory requirements and auditing standards.
We report to you our opinion as to whether the financial statements give a true and fair view and are properly prepared in
accordance with the Companies Act 1985. We also report if, in our opinion, the Directors’ Report is not consistent with the financial
statements, if the Company has not kept proper accounting records, if we have not received all the information and explanations
we require for our audit, or if information specified by law regarding directors’ remuneration and transactions with the Company
and other members of the Group is not disclosed.
We read the Directors’ Report and the other information contained in the Annual Report for the above year as set out in the
contents section and consider the implications for our report if we become aware of any apparent misstatements or material
inconsistencies with the financial statements. 
Basis of audit opinion
We conducted our audit in accordance with United Kingdom auditing standards issued by the Auditing Practices Board. An audit
includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also
includes an assessment of the significant estimates and judgements made by the directors in the preparation of the financial
statements, and of whether the accounting policies are appropriate to the circumstances of the Company and Group, consistently
applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order
to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material
misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall
presentation of information in the financial statements.
Opinion
In our opinion the financial statements give a true and fair view of the state of affairs of the Company and the Group as at 30 April
2004 and of the loss of the Group for the year then ended and have been properly prepared in accordance with the Companies
Act 1985.
Deloitte & Touche LLP
Chartered Accountants and Registered Auditors
Liverpool
5 August 2004 Osmetech Annual Report 2004 13
Consolidated profit and loss account
for the year ended 30 April 2004
Year ended Year ended
30.04.04 30.04.03
Note £ £
Turnover 2 6,180,028 686,411
Cost of sales (2,733,651) (315,630)
Gross profit 3,446,377 370,781
Administrative expenses (4,864,443) (3,469,618)
Operating loss 4 (1,418,066) (3,098,837)
Exceptional cost of fundamental restructuring of continuing operations 5 – (862,981)
(1,418,066) (3,961,818)
Interest receivable 8 102,245 130,919
Interest payable and similar charges 9 (97) (146)
Loss on ordinary activities before taxation (1,315,918) (3,831,045)
Taxation 10 147,804 163,762
Loss for the year transferred from reserves 21 (1,168,114) (3,667,283)
Basic and Diluted Loss per share 12 (0.21p) (0.94p)
All activities arose from continuing operations.
Consolidated statement of total recognised gains and losses
for the year ended 30 April 2004
Year ended Year ended
30.04.04 30.04.03
£ £
Loss for the financial year (1,168,114) (3,667,283)
Currency translation difference on foreign currency net investments (241,703) 2,930
Total recognised losses relating to the year (1,409,817) (3,664,353) 14 Osmetech Annual Report 2004
Consolidated balance sheet 
at 30 April 2004
At 30.04.04 At 30.04.03
Note ££ ££
Fixed assets
Intangible assets 13 1,021,933 1,074,958
Tangible assets 14 476,513 412,341
1,498,446 1,487,299
Current assets
Stocks 16 967,278 966,424
Debtors – due within one year 17 1,464,345 1,116,234
Investments – Term Deposits 18 2,700,000 2,720,000
Cash at bank and in hand 472,317 518,833
5,603,940 5,321,491
Creditors: amounts falling due within one year 19 (940,483) (1,574,647)
Net current assets 4,663,457 3,746,844
Net assets 6,161,903 5,234,143
Capital and reserves
Called up share capital 20 6,044,304 5,161,775
Share premium account 21 29,493,748 28,038,700
Profit and loss account 21 (29,376,149) (27,966,332)
Equity shareholders’ funds 22 6,161,903 5,234,143
These financial statements were approved by the Board of Directors on 5 August 2004
Signed on behalf of the Board of Directors
D A Sandilands Director Osmetech Annual Report 2004 15
Company balance sheet
at 30 April 2004
At 30.04.04 At 30.04.03
Note ££ ££
Fixed assets
Intangible assets 13 680,419 671,065
Tangible assets 14 3,093 31,478
Investments 15 3,006,672 2,292,729
3,690,184 2,995,272
Current assets
Stocks 16 – 33,486
Debtors – due within one year 17 471,547 503,391
Investments – term deposits 18 2,700,000 2,720,000
Cash at bank and in hand 429,886 412,428
3,601,433 3,669,305
Creditors: amounts falling due within one year 19 (324,995) (751,571)
Net current assets 3,276,438 2,917,734
Net assets 6,966,622 5,913,006
Capital and reserves
Called up share capital 20 6,044,304 5,161,775
Share premium account 21 29,493,748 28,038,700
Profit and loss account 21 (28,571,430) (27,287,469)
Equity shareholders’ funds 22 6,966,622 5,913,006
These financial statements were approved by the Board of Directors on 5 August 2004
Signed on behalf of the Board of Directors
D A Sandilands Director 16 Osmetech Annual Report 2004
Consolidated cash flow statement
for the year ended 30 April 2004
Year ended Year ended
30.04.04 30.04.03
Note £ £
Net cash outflow from operating activities (a) (1,772,616) (3,441,612)
Returns on investments and servicing of finance (c) 101,049 127,267
Taxation (c) 227,529 449,569
Capital expenditure and financial investment (c) (238,303) (166,944)
Acquisitions and disposals (b) (421,762) (1,340,342)
Cash outflow before management of liquid resources and financing (2,104,103) (4,372,062)
Management of liquid resources (c) 20,000 (620,000)
Financing (c) 2,047,577 4,894,955
Decrease in cash (36,526) (97,107)
Reconciliation of net cash flow to movement in net funds
Year ended Year ended
30.04.04 30.04.03
£ £
Decrease in cash in the year (36,526) (97,107)
(Decrease)/increase in liquid resources (20,000) 620,000
Exchange differences (9,990) (488)
Change in net funds (66,516) 522,405
Net funds at beginning of year 3,238,833 2,716,428
Net funds at end of year 3,172,317 3,238,833 Osmetech Annual Report 2004 17
Notes to the consolidated cash flow statement
(a) Reconciliation of operating loss to operating cash flows
Year ended Year ended
30.04.04 30.04.03
£ £
Operating loss (1,418,066) (3,098,837)
Depreciation and amortisation 157,831 126,674
Loss on disposal of fixed assets – 54,648
(Increase)/decrease in stocks (62,297) 63,876
Increase in debtors (274,442) (725,438)
(Decrease)/increase in creditors (175,642) 137,465
Net cash outflow from operating activities (1,772,616) (3,441,612)
(b) Acquisitions and disposals
On 1 April 2003, the Group acquired the assets of the Atlanta, US based “OPTI” product line of blood gas analysers from Roche
Diagnostics Inc. The total consideration adjusted for final inventory levels and excluding costs was $2,745,000 (£1,671,294). The
total consideration of £1,762,104 (including legal fees of £90,810) was paid in a number of instalments over the two financial years:
Year ended Year ended
30.04.04 30.04.03
£ £
Consideration paid during the year (421,762) (1,340,342)
(c) Analysis of cash flows 
Year ended Year ended
30.04.04 30.04.03
£ £
(i) Gross cash flows
Returns on investments and servicing of finance
Interest received 101,146 127,413
Interest paid (97) (146)
101,049 127,267
Taxation
Research and Development tax credit 227,529 449,569
Capital expenditure and financial investment
Payments to acquire intangible fixed assets (14,754) (79,379)
Payments to acquire tangible assets (223,549) (87,565)
(238,303) (166,944)
Management of liquid resources
Transfer from/(to) Term Deposits 20,000 (620,000)
Financing
Shares issued 2,147,577 5,562,998
Share issue expenses (100,000) (668,043)
2,047,577 4,894,955 18 Osmetech Annual Report 2004
Notes to the consolidated cash flow statement
continued
(ii) Analysis of changes in net funds
At Cash Exchange At
30.04.03 flows differences 30.04.04
£££ £
Cash at bank and in hand 518,833 (36,526) (9,990) 472,317
Current asset investments 2,720,000 (20,000) – 2,700,000
Net Funds 3,238,833 (56,526) (9,990) 3,172,317 Osmetech Annual Report 2004 19
Notes forming part of the financial statements
for the year ended 30 April 2004
1  Accounting policies
The financial statements have been prepared under the historical cost convention and are in accordance with applicable United
Kingdom accounting standards. The Company has taken advantage of the exemption conferred by section 230 of the Companies
Act 1985 from presenting its own profit and loss account. The following accounting policies, which have not changed in the year,
have been applied.
Basis of consolidation
The consolidated accounts incorporate the financial statements of Osmetech plc and all of its subsidiary undertakings made up to
30 April 2004. The Company uses the acquisition method of accounting to consolidate the results of its subsidiary 
undertakings. The results of subsidiary undertakings are included from the date of acquisition. 
Investments
Investments held as fixed assets are stated at cost less provision for impairment.
Acquisitions and disposals
On acquisition of a business, including an interest in an associated undertaking, fair values are attributed to the Group’s share of
net separable assets under the acquisition method in FRS6 ‘Acquisitions and Mergers’. Where the cost of acquisition exceeds the
fair values attributable to such net assets, the difference is treated as purchased goodwill and capitalised in the balance sheet in
the year of acquisition. The results and cash flow relating to a business are included in the consolidated profit and loss account
and the consolidated cash flow statement from the date of acquisition.
Turnover
Turnover represents sales of goods and services to third parties and access fees, milestone payments and non-refundable licence
fees due from third parties, excluding value added tax.
Unearned amounts are carried forward as deferred income.
Tangible fixed assets
Tangible fixed assets are stated at cost, net of depreciation and any provision for impariment.
Depreciation
Depreciation is provided to write off the cost, less estimated residual values, of all tangible fixed assets over their expected useful
lives. It is calculated at the following rates:
Short leasehold improvements – over the life of lease
Plant, machinery and motor vehicles – 10-35% per annum on cost
Office equipment – 25-50% per annum on cost 
Taxation
Current tax, including UK corporation tax, research and development tax credits and foreign tax, is provided at amounts expected
to be paid or recovered using the tax rates and laws enacted or substantively enacted by the balance sheet date.
Deferred taxation
Deferred tax is provided in full on timing differences which result in an obligation at the balance sheet date to pay more tax, or a
right to pay less tax at a future date, at rates expected to apply when they crystallise based on current tax rates and law. Timing
differences arise from the inclusion of items of income and expenditure in taxation computations in periods different from those in
which they are included in the financial statements. Deferred tax assets are recognised to the extent that it is regarded as more
likely than not that they will be recovered. Deferred tax assets and liabilities are not discounted. 20 Osmetech Annual Report 2004
Notes forming part of the financial statements
continued
1  Accounting policies continued
Finance costs
Finance costs associated with the issue of debt are deducted from the proceeds of the issue and charged to the profit and loss
account over the term of the debt so that the amount charged is at a constant rate on the carrying amount.
Financial instruments
In relation to the disclosures made in note 26:
• Short term debtors and creditors are not treated as financial assets or financial liabilities.
• The Group does not hold or issue derivative financial instruments for trading purposes.
• Forward exchange contracts are used to fix the value of the related asset or liability in the contract currency at the contract
rate and any gains or losses on these instruments are offset. Where the instrument is used to hedge a committed or
probable future transaction, gains and losses are deferred until the transaction occurs.
Foreign currency
Profit and loss accounts of foreign subsidiary undertakings are translated into sterling at the average rate. Assets and liabilities of
the foreign subsidiary undertakings are translated into sterling at the rates of exchange ruling on the balance sheet date.
Exchange differences which arise from translation of the net investment in foreign subsidiary undertakings and the translation of
the profit and loss account between closing rate and average rate are taken to reserves.
All other differences are taken to the profit and loss account with the exception of differences on foreign currency borrowings,
which, to the extent that they are used to finance or provide a hedge against foreign equity investments, are taken directly to
reserves to the extent of the exchange differences arising on the net investment in those enterprises.
Intellectual property rights
Patent and trademark costs are capitalised and written off on a straight line basis over the shorter of the life of the patent or
trademark or its useful economic life. The Company’s other intellectual property rights are stated at cost and amortised over their
useful economic lives in relation to revenues generated. 
Goodwill
Purchased goodwill, representing the excess of the fair value of the consideration over the fair value of the assets acquired, is
capitalised and amortised on a straight line basis over its useful economic life. This is presumed to be 15 years unless
circumstances change significantly resulting in an impairment of the carrying value.
Research and development
All research and development expenditure is charged to the profit and loss account in the year in which it is incurred.
Stock
Stocks are valued at the lower of cost or net realisable value. Cost is calculated as follows:
Raw materials – cost of purchase on first in, first out basis.
Finished goods – cost of raw materials and labour and attributable overheads based on the normal level of activity.
Net realisable value is based on estimated selling price less further costs to completion and disposal. Osmetech Annual Report 2004 21
Notes forming part of the financial statements
continued
1  Accounting policies continued
Pension costs
Contributions to defined contribution pension schemes are charged to the profit and loss account in the year in which they
become payable.
Operating leases
Rentals under operating leases are charged on a straight line basis over the lease term, even if the payments are not made on
such a basis.
2  Turnover
The turnover is wholly attributable to the Group’s principal activity.
Turnover is analysed by market as follows:
2004 2003
£ £
United Kingdom 123,923 3,008
Rest of Europe 1,142,784 43,082
USA 2,331,073 212,399
Far East 2,120,280 403,038
Rest of world 461,968 24,884
6,180,028 686,411
All turnover originates in the United States. All turnover is to external customers. 
3  Analysis of loss before taxation and net assets
The directors have not disclosed segmental analysis on the grounds that it is considered seriously prejudicial to the Group’s
commercial interests.
4  Operating loss
2004 2003
£ £
This is arrived at after charging:
Amortisation of intangible fixed assets 30,807 16,566
Depreciation 127,024 110,108
Auditors’ remuneration – audit services: Osmetech plc 24,500 22,500
– audit services: Other Group companies 17,791 17,493
Previous auditors – non audit services – 12,877
Operating lease rentals – plant and machinery – –
– other 263,036 192,576
Research and development 1,744,862 1,375,948
Loss on disposal of fixed assets – 54,648
Amounts payable to Deloitte & Touche LLP and their associates by the Company and its UK subsidiary undertakings in respect of
non-audit services were £11,000 (2003 – £nil). 22 Osmetech Annual Report 2004
Notes forming part of the financial statements
continued
5  Cost of fundamental restructuring of continuing operations
The costs in 2003 relate to the closure of the Company’s facilities in Woburn, Massachusetts, USA and Crewe, Cheshire, UK and
related provisions for the write off of intangible and tangible fixed assets.
2004 2003
£ £
Intangible fixed assets – 243,903
Tangible fixed assets – 112,361
Closure costs – 506,717
- – 862,981
The effect of this exceptional charge on pre and post tax results in 2003 was £862,981.
6  Employees
2004 2003
£ £
Staff costs for all employees, including executive directors, consist of:
Wages and salaries 2,739,148 1,150,246
Social security costs 227,584 110,302
Other pension costs 107,637 87,443
3,074,369 1,347,991
The average monthly number of employees of the Group during the year, including executive directors, was as follows:
Number Number
Manufacturing 24 2
Research and development 21 19
Selling and administration 19 8
64 29
7  Directors
2004 2003
£ £
Emoluments 403,261 479,303
Defined contribution pension scheme payments 40,230 40,780
443,491 520,083
Highest paid director:
Emoluments 198,311 155,866
Defined contribution pension scheme payments 22,500 18,750
220,811 174,616
Directors’ interests
The interests of the directors in ordinary shares of Osmetech plc are all held beneficially as reported in the Report of the directors
on page 8. Osmetech Annual Report 2004 23
Notes forming part of the financial statements
continued
7  Directors continued
Defined Contribution Pension Scheme Payments
2004 2003
Number of Number of
directors directors
Defined contribution pension schemes 3 3
Options
Total options Lapsed/ Total options
on ordinary Granted surrendered on ordinary Exercise
shares during the during the shares Date of price per Exercisable
Director 30.04.03* year year 30.04.04 Grant share From To
G J Hall 1,000,000 – – 1,000,000 25.09.98 2p 21.10.01 21.01.08
J N G White 120,000 – – 120,000 25.09.98 2p 21.10.01 21.01.08
5,000,000 – – 5,000,000 30.09.02 2p 30.09.05 30.09.12
15,815,900 – – 15,815,900 24.02.03 2.39p 24.02.04 24.02.13
4,184,100 – – 4,184,100 24.02.03 2.39p 24.02.04 24.02.13
D A Sandilands 2,500,000 – – 2,500,000 30.09.02 2p 30.09.05 30.09.12
5,815,900 – – 5,815,900 24.02.03 2.39p 24.02.04 24.02.13
4,184,100 – – 4,184,100 24.02.03 2.39p 24.02.04 24.02.13
G B Kuenster 1,350,000 – – 1,350,000 26.04.00 26
1
/
4
p 26.04.03 26.04.10
1,000,000 – – 1,000,000 20.03.01 11p 20.03.04 20.03.11
1,000,000 – – 1,000,000 29.01.02 12
3
/
4
p 29.01.05 29.01.12
A Marek (appointed 21 April 2004) 10,000,000 – – 10,000,000 1.04.03 2.33p 1.04.04 1.04.13
The mid-market price of the shares at 30 April 2004 was 4.33p (2003 – 3.45p) and the range during the period was between 2.81p
and 5p; (2003 – 1.75p and 12.42p). 
*or date of appointment if later
8  Interest receivable
2004 2003
£ £
Interest on bank balances and term deposits 102,245 130,919
102,245 130,919
9  Interest payable and similar charges
2004 2003
£ £
Bank borrowings 97 146
97 146 24 Osmetech Annual Report 2004
Notes forming part of the financial statements
continued
10  Tax on loss on ordinary activities
The tax credit comprises:
2004 2003
£ £
Current tax:
UK corporation tax receivable (147,804) (227,529)
Adjustment in respect of prior years research and development tax credit – 63,767
Total tax on loss on ordinary activities (147,804) (163,762)
The difference between the total current tax shown above and the amount calculated by applying the standard rate of UK
corporation tax to the profit before tax is as follows:
2004 2003
£ £
Loss on ordinary activities before tax (1,315,918) (3,831,045)
Tax credit at 30% (394,775) (1,149,314)
Effects of:
–   losses which are available to set against future profits 418,074 1,149,314
–   research and development tax credit (147,804) (163,762)
–   expenses not deductible for tax purposes 10,959 –
–   capital allowances in excess of depreciation (22,826) –
–   movement in short term timing differences (11,432) –
Total current tax credit (147,804) (163,762)
Factors that may affect the future tax charge
A deferred tax asset has not been recognised in respect of timing differences relating to tax losses carried forward as there is
insufficient evidence that the asset will be recovered. The amount of the asset not recognised at a standard tax rate of 30% is
£6,412,912 (2003 – £5,019,332). In addition, a deferred tax asset in respect of capital allowances and general provisions of £317,063
(2003 – £nil) has not been recognised. These assets will be recoverable if the company generates profits in the future from the
same trade in which the losses were incurred.
11  Loss attributable to the Company
The loss for the financial year dealt with in the financial statements of the parent company was £1,283,961 (2003 – £2,987,237). As
permitted by Section 230 of the Companies Act 1985, no separate profit and loss account is presented in respect of the parent
company.
12  Loss per share
The loss per share of 0.21p (2003 – loss per share 0.94p) has been calculated on the weighted average number of shares in issue
during the year namely 561,457,432; (2003 – 389,690,248) and losses of £1,168,114; (2003 – £3,667,283). 
FRS 14 requires presentation of diluted EPS when a company could be called upon to issue shares that would decrease net profit
or increase net loss per share. For a loss making company with outstanding share options, net loss per share would only be
increased by the exercise of out-of-the-money options. Since it is inappropriate to assume that option holders would act
irrationally, no adjustment is made to diluted EPS for out-of-the-money share options. Osmetech Annual Report 2004 25
Notes forming part of the financial statements
continued
13  Intangible assets
Group Company
Patents and Intellectual Patents and Intellectual
Trademarks Property Goodwill Total Trademarks Property Goodwill Total
£££ £ £££ £
Group
Cost
At beginning of year 180,932 600,000 405,629 1,186,561 180,932 600,000 – 780,932
Additions 14,754 – – 14,754 14,754 – – 14,754
Currency translation adjustment – – (38,074) (38,074) ––– –
At end of year 195,686 600,000 367,555 1,163,241 195,686 600,000 – 795,686
Amortisation
At beginning of year 13,607 96,260 1,736 111,603 13,607 96,260 – 109,867
Charge for the year 5,400 – 25,407 30,807 5,400 – – 5,400
Currency translation adjustment - – (1,102) (1,102) ––– –
At end of year 19,007 96,260 26,041 141,308 19,007 96,260 – 115,267
Net book value
At 30 April 2004 176,679 503,740 341,514 1,021,933 176,679 503,740 – 680,419
At 30 April 2003 167,325 503,740 403,893 1,074,958 167,325 503,740 – 671,065
14  Tangible assets
Short Plant, machinery
leasehold and motor Office
improvements vehicles equipment Total
£££ £
Group
Cost
At beginning of year – 340,904 150,647 491,551
Additions 1,124 138,678 83,747 223,549
Currency translation adjustment – (23,234) (13,236) (36,470)
At end of year 1,124 456,348 221,158 678,630
Depreciation
At beginning of year – 69,170 10,040 79,210
Charge for the year 39 70,445 56,540 127,024
Currency translation adjustment (1) (2,111) (2,005) (4,117)
At end of year 38 137,504 64,575 202,117
Net book value
At 30 April 2004 1,086 318,844 156,583 476,513
At 30 April 2003 – 271,734 140,607 412,341 26 Osmetech Annual Report 2004
Notes forming part of the financial statements
continued
14  Tangible assets continued
Plant, machinery
and motor Office
vehicles equipment Total
££ £
Company
Cost
At beginning of year 93,374 9,639 103,013
Additions – 3,301 3,301
Transfers to other group companies (93,374) – (93,374)
At end of year – 12,940 12,940
Depreciation
At beginning of year 64,763 6,772 71,535
Charge for the year 17,085 3,075 20,160
Transfers to other group companies (81,848) – (81,848)
At end of year – 9,847 9,847
Net book value
At 30 April 2004 – 3,093 3,093
At 30 April 2003 28,611 2,867 31,478
15  Fixed asset investments
Shares Loan Total
££ £
Company
Cost
At beginning of year 646 9,090,703 9,091,349
Transactions in the year – 713,943 713,943
At end of year 646 9,804,646 9,805,292
Provision for impairment
At beginning of year and end of year 645 6,797,975 6,798,620
Net book value
At 30 April 2004 1 3,006,671 3,006,672
At 30 April 2003 1 2,292,728 2,292,729
The following were subsidiary undertakings at the end of the year and have all been included in the consolidated accounts.
Proportion of
Country of voting rights and
incorporation ordinary share
Name or registration capital held Nature of business
Osmetech Technology Inc USA 100% Holding Company
Osmetech Inc USA 100%* Same as ultimate parent company
Osmetech AESOP Trustee Limited UK 100% Dormant
The country of operation is the same as its country of incorporation or registration.
*Shares held by Osmetech Technology Inc. Osmetech Annual Report 2004 27
Notes forming part of the financial statements
continued
16  Stocks
2004 2003
Group Company Group Company
££ ££
Raw materials and work in progress 600,574 – 424,845 33,486
Finished goods 366,704 – 541,579 –
967,278– 966,424 33,486
There is no material difference between the replacement cost of stocks and the amount at which they are stated in the financial
statements.
17  Debtors
2004 2003
Group Company Group Company
££ ££
Due within one year
Trade debtors 928,649 – 589,501 7,550
Other debtors 46,251 14,715 38,343 38,343
Called up share capital not paid 290,000 290,000 ––
Taxation recoverable 149,515 149,515 244,420 244,420
Prepayments and accrued income 49,930 17,317 243,970 213,078
1,464,345 471,547 1,116,234 503,391
18  Investments – term deposits
2004 2003
£ £
Group and Company
Cash deposits with terms in excess of 7 days 2,700,000 2,720,000
19  Creditors: amounts falling due within one year
2004 2003
Group Company Group Company
££ ££
Trade creditors 217,984 30,210 495,004 202,513
Taxation and social security 51,820 51,820 30,972 30,972
Accruals and deferred income 670,679 242,965 1,042,080 518,086
Other creditors –– 6,591 –
940,483 324,995 1,574,647 751,571 28 Osmetech Annual Report 2004
Notes forming part of the financial statements
continued
20  Share capital
Allotted, called up Allotted and
Authorised and fully paid called up
2004 2003 2004 2003 2004 2003
£ £ £ £££
Ordinary shares of 1p 8,100,000 8,100,000 5,899,304 5,161,775 145,000 –
The number of authorised ordinary shares at 30 April 2004 is 810,000,000 (2003 – 810,000,000); the number of allotted, called up
and fully paid ordinary shares at 30 April 2004 is 589,930,397 (2003 – 516,177,571); and the number of allotted and called up
ordinary shares at 30 April 2004 is 14,500,000 (2003 – nil).
The following ordinary shares of 1p each were issued during the year:
Date Number Consideration per share
12 June 2003 125,000 1.75p
276,000 2.39p
30 June 2003 125,000 1.75p
50,000 2.39p
1 July 2003 250,000 1.75p
25,000 2.39p
2 July 2003 125,000 1.75p
352,862 2.39p
3 July 2003 125,000 1.75p
4 July 2003 250,000 1.75p
418,389 2.39p
7 July 2003 187,500 1.75p
358,686 2.39p
7 July 2003 250,000 1.75p
580,884 2.39p
22,000 2p
9 July 2003 100,000 1.75p
17 July 2003 225,000 1.75p
21 July 2003 125,000 1.75p
22 July 2003 93,750 1.75p
22 August 2003 48,000 2p
6 October 2003 66,666,667 3p
4 December 2003 125,000 1.75p
383,686 2.39p
9 January 2004 200,000 1.75p
380,150 2.39p
4 February 2004 15,000,000 2p
5 February 2004 250,000 1.75p
634,252 2.39p
9 February 2004 250,000 1.75p
12 February 2004 250,000 1.75p Osmetech Annual Report 2004 29
Notes forming part of the financial statements
continued
20  Share capital continued
Share options
The Company has granted options under the Osmetech plc Enterprise Management Incentive Plan (“EMI Plan”) and the
Osmetech plc 2003 US Equity Compensation Plan (“US Plan”) and has entered into individual option agreements as follows:
1. EMI Plan:
Number of ordinary shares
under option as at Subscription
Date 30.04.04 30.04.03 Price Exercisable between
1 March 2001 – 869,565 11
1
/
2
p 1 March 2004 and 1 March 2011
17 September 2002 1,437,500 4,493,750 1
3
/
4
p 17 December 2002 and 17 September 2012
24 February 2003 11,359,518 14,819,427 2.39p 17 December 2003 and 24 February 2013
12,797,018 20,182,742
2. US Plan:
Number of ordinary shares
under option as at Subscription
Date 30.04.04 30.04.03 Price Exercisable between
1 April 2003 25,000,000 25,000,000 2.33p 1 April 2004 and 1 April 2013
3. Individual Option Agreements:
Number of ordinary shares
under option as at Subscription
Date 30.04.04 30.04.03 Price Exercisable between
25 September 1998 1,237,000 1,307,000 2p 21 October 2001 and 21 October 2008
21 May 1999 – 78,872 18p 21 May 2002 and 21 May 2009
13 October 1999 – 500,000 17
3
/
4
p 13 October 2002 and 13 October 2009
26 April 2000 1,350,000 3,150,000 26
1
/
4
p 26 April 2003 and 26 April 2010
1 March 2001 – 500,000 11
1
/
2
p 1 March 2004 and 1 March 2011
20 March 2001 250,000 250,000 11p 20 March 2004 and 20 March 2011
20 March 2001 750,000 750,000 11p 20 March 2004 and 20 March 2011
29 January 2002 2,000,000 3,500,000 12
3
/
4
p 29 January 2005 and 29 January 2012
17 September 2002 2,500,000 2,500,000 2p 17 September 2005 and 17 September 2012
30 September 2002 7,500,000 7,500,000 2p 30 September 2005 and 30 September 2012
24 February 2003 21,631,800 21,631,800 2.39p 24 February 2004 and 24 February 2013
37,218,800 41,667,672
Warrants
The Company has warrants outstanding as follows:
Number of ordinary shares
under warrant as at Subscription
Date 30.04.04 30.04.03 Price Exercisable between
14 January 2002 300,000 300,000 14.055p 15 January 2002 and 14 January 2005
29 January 2002 730,000 730,000 13.32p 30 January 2002 and 29 January 2005
30 September 2002 – 15,000,000 2p 30 September 2002 and 30 September 2005
1,030,000 16,030,000 30 Osmetech Annual Report 2004
Notes forming part of the financial statements
continued
21  Reserves
Share Profit 
premium and loss
account account
££
Group
At beginning of year 28,038,700 (27,966,332)
On new share capital subscribed 1,555,048–
Issue expenses (100,000) –
Loss for the year – (1,168,114)
Exchange loss on consolidation – (241,703)
At end of year 29,493,748(29,376,149)
Share Profit 
premium and loss
account account
££
Company
At beginning of year 28,038,700 (27,287,469)
On new share capital subscribed 1,555,048–
Issue expenses (100,000) –
Loss for the year – (1,283,961)
At end of year 29,493,748(28 ,571,430)
22  Reconciliation of movements in shareholders’ funds
2004 2003
Group Company Group Company
££ ££
Loss for the financial year (1,168,114) (1,283,961) (3,667,283) (2,987,237)
Other recognised gains and losses relating to the year (241,703) – 2,930 –
New share capital subscribed including premium 2,337,577 2,337,577 4,894,955 4,894,955
Net increase in shareholders’ funds 927,760 1,053,616 1,230,602 1,907,718
Opening shareholders’ funds 5,234,143 5,913,006 4,003,541 4,005,288
Closing shareholders’ funds 6,161,903 6,966,622 5,234,143 5,913,006
23  Commitments
At the balance sheet date the Group had annual commitments under non-cancellable operating leases as set out below:
Land and Land and
buildings Other buildings Other
2004 2004 2003 2003
££ ££
Operating leases which expire:
Within 1 year –– 437,531 5,821
Two and five years –– – 2,362
Over five years 168,055 5,067 ––
168,055 5,067 437,531 8,183 Osmetech Annual Report 2004 31
Notes forming part of the financial statements
continued
24  Related party transactions
The Company has taken advantage of the exemption not to disclose transactions with other Group undertakings as voting rights
are controlled within the Group and consolidated financial statements are publicly available.
No director was, or is, materially interested in any contract subsisting during, or at the end of the financial year which was
significant in relation to the business of the Group.
25  Pension costs
The Company makes contributions into money purchase pension schemes for the benefit of its employees. The assets of the
schemes are held separately from those of the Company in independently administered funds. The pension cost charge represents
contributions payable and paid by the Company to the funds, and amounted to £107,637 for the year (2003 – £87,443).
26  Financial instruments
The numerical disclosures in this note deal with financial assets and financial liabilities as defined in Financial Reporting Standard
13 – Derivatives and Other Financial Instruments: Disclosures (FRS13). Certain financial assets such as investments in subsidiaries
are excluded from the scope of these disclosures.
As permitted by FRS13, short-term debtors and creditors have been excluded from the disclosures other than the currency risk
disclosures.
There is no material difference between the fair values and book values of the Group’s financial instruments, either in the current or
prior year.
The Group’s treasury activities are designed to provide suitable, flexible funding arrangements to satisfy its requirements. The
Group uses financial instruments comprising cash and term deposits. The main risks arising from the Group financial instruments
are interest rate and liquidity risks. The Board reviews policies for managing each of these risks and they are summarised below.
These policies have remained unchanged from previous years.
The Group aims to achieve a balance between continuity and flexibility of funding by maintaining a range of maturities on its
liquid resources. The Group also mixes the duration of its deposits to reduce the impact of interest rate fluctuations.
The Group has limited foreign currency risk since overseas subsidiaries derive revenues and incur expenses denominated
predominantly in the currencies of the countries in which they operate. All monetary assets and liabilities of the Group are
materially denominated in the operating or functional currency of the operating unit involved.
Interest bearing financial assets
Functional currency of operations
2004 2003
Group Sterling Dollar Group Sterling Dollar
£££ £££
Cash 472,317 429,886 42,431 518,833 411,730 107,103
Term Deposits 2,700,000 2,700,000 – 2,720,000 2,720,000 –
3,172,317 3,129,886 42,431 3,238,833 3,131,730 107,103
The sterling and US dollar cash balances attract interest at floating rates based on the Bank of England Base rate and US Prime Rate
respectively.
The term deposits are of 1 month’s duration, at a weighted average fixed rate of 4.06% (2003 – 1 month’s duration, 3.69%). 32 Osmetech Annual Report 2004
Notice of annual general meeting
Notice is hereby given that the Annual General Meeting of Osmetech plc (the “Company”) will be held at the offices of Ashurst,
Broadwalk House, 5 Appold Street, London EC2A 2HA on 23 September 2004 at 11.00 am for the purpose of considering and, if
thought fit, passing the following resolutions:
Ordinary Business
1. To receive and consider the accounts for the year ended 30 April 2004, together with the reports of the directors and auditors
thereon.
2. To elect A Marek as a director.
3. To re–elect G J Hall as a director.
4. To re–elect G B Kuenster as a director.
5. To re–appoint Deloitte & Touche LLP as auditors of the Company until the conclusion of the next annual general meeting and
to authorise the directors of the Company to determine their remuneration.
Special Business
To consider and, if thought fit, to pass the following resolutions which number 6 will be proposed as an ordinary resolution and
number 7 will be proposed as a special resolution:
6. That the directors be and they are hereby generally and unconditionally authorised for the purposes of and pursuant to
section 80 of the Companies Act 1985 (the “Act”) to exercise all the powers of the Company to allot relevant securities (within
the meaning of section 80(2) of the Act) up to an aggregate nominal amount of £2,014,767 provided that this authority shall,
unless renewed, varied or revoked, expire at the earlier of (A) 31 October 2005 and (B) the conclusion of the next annual
general meeting of the Company to be held in 2005 and provided further that the Company may before the expiry of such
period make any offer, agreement or arrangement which would or might require relevant securities to be allotted after such
expiry and the directors of the Company may allot relevant securities pursuant to any such offer, agreement or arrangement as
if the authority hereby conferred had not expired. This authority shall be in addition to any like authority pursuant to the said
section 80 to the extent not utilised at the time and date on which this Resolution 6 is passed.
7. That, subject to the passing of Resolution 6 above, the directors of the Company be and they are hereby empowered to allot
equity securities (within the meaning of section 94(2) of the Act) for cash pursuant to the authority conferred by Resolution 6
above as if section 89(1) of the Act did not apply to any such allotment, provided that this power shall, unless renewed, varied
or revoked, expire at the earlier of (A) 31 October 2005 and (B) the conclusion of the next annual general meeting of the
Company to be held in 2005 and provided further that this power shall be limited to the allotment of equity securities:
(i) in connection with a rights issue, open offer or other pre-emptive issue in favour of ordinary shareholders where the
equity securities respectively attributable to the interests of all ordinary shareholders are proportionate (as nearly as
practical) to the respective number of ordinary shares held by them but subject to such exclusions or other arrangements
as the directors may deem necessary or desirable in relation to fractional entitlements or legal or practical problems
arising in, or pursuant to, the laws of any territory or the requirement of any regulatory body or stock exchange in any
territory; and
(ii) (otherwise than pursuant to paragraph (i) above) up to an aggregate nominal amount of £1,208,860,  Osmetech Annual Report 2004 33
Notice of annual general meeting
continued
and provided further that the Company may, at any time before the expiry of such power make any offer or enter into any
agreement which would or might require equity securities to be allotted after the expiry of such power and the directors may
allot equity securities in pursuance of any such offer or agreement as if such power conferred hereby had not expired. This
power shall be in addition to any existing like power to the extent not utilised at the time and date on which this Resolution 7
becomes unconditional.
By Order of the Board Registered office  
S A Craig Broadwalk House
Secretary 5 Appold Street
London EC2A 2HA 
5 August 2004
NOTES:
(1) A member of the Company may appoint one or more proxies to attend and, on a poll, to vote instead of the member. A proxy
of a member need not also be a member.
(2) The instrument appointing a proxy, and the power of attorney or other authority (if any) under which it is signed, or a notarially
certified copy of that power or authority must be deposited with the Company’s Registrars, Capita Registrars, Proxy
Department, The Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4TU, not less than 48 hours before the time for
holding the meeting. A form of Proxy accompanies this document for use by members.
(3) Completion of the Form of Proxy will not preclude a member from attending and voting in person.
(4) As permitted by Regulation 41 of the Uncertificated Securities Regulations 2001, only those holders of Ordinary Shares who
are registered on the Company’s share register as at 11.00 am on 21 September 2004 shall be entitled to attend the Annual
General Meeting and to vote in respect of the number of shares registered in their names at that time. Changes to entries on
the share register after 11.00 am on 21 September 2004 shall be disregarded in determining the rights of any person to attend
and/or vote at the Annual General Meeting.
(5) The register of directors’ interests in the share capital of the Company is available for inspection at the Company’s registered
office during normal business hours from the date of this notice until the date of the annual general meeting and will be
available for inspection at the place of the annual general meeting for at least 15 minutes prior to and during the meeting.  OSMETECH plc: Proxy for use at annual general meeting
Please insert I/We
full name
(Please use block letters)
and address of
of
being member(s) of the above–named company, hereby appoint the Chairman of the Annual General Meeting
or (see note 1)
as my/our proxy to vote for me/us and on my/our behalf at the Annual General Meeting of the Company to be held at the offices
of Ashurst, Broadwalk House, 5 Appold Street, London EC2A 2HA on 23 September 2004 at 11.00 am and at any adjournment
thereof.
I/we request such proxy to vote on the following resolutions as mentioned below (see note 2)
Signature (see note 3) Dated this day of 2004
Joint holders (if any) (see note (5))
Name Name 
Name Name 
NOTES:
(1) If you wish to appoint some other person as your proxy please insert his/her name and address, initial and strike out the words “the Chairman of the Meeting”. A
proxy need not be a member of the Company. Appointing a proxy will not preclude you from personally attending and voting at the meeting (in substitution for your
proxy vote) if you subsequently decide to do so.
(2) Please indicate with an “X” in the appropriate box how you wish your votes cast. Unless otherwise instructed the proxy will exercise his/her discretion as whether, and
if so, how he/she will vote.
(3) This Form of Proxy must, in the case of an individual, be signed by the appointer or his/her attorney or, in the case of a corporation, be given under its common seal
or signed on its behalf by an attorney or a duly authorised officer or, if it is subject to the Companies Act 1985 (as amended), in accordance with Section 36A thereof.
(4) To be valid this Form of Proxy and any power of attorney or other authority under which it is executed (or a duly notarised copy thereof) must be lodged with the
Registrars of the Company, Capita Registrars, Proxy Department, The Registry, 34 Beckenham Road, Beckenham, Kent, BR3 4TU, not less than 48 hours before the
time appointed for the meeting, or adjourned meeting at which it is to be used.
(5) In the case of joint holders of a share the vote of the senior who tenders a vote whether in person or by proxy shall be accepted to the exclusion of the votes of the
other joint holders and for this purpose seniority shall be determined by the order in which the names stand in the statutory register of members in respect of the
share.
(6) Any alteration in this Form of Proxy must be initialled by the person in whose hand it is signed or executed.
Ordinary Business FOR AGAINST
1. To receive and consider the accounts for the year ended 30 April 2004, together with the 
reports of the directors and auditors thereon.
2. To elect A Marek as a director.
3. To re-elect G J Hall as a director.
4 To re-elect G B Kuenster as a director.
5. To re-appoint Deloitte & Touche LLP as auditors of the Company until the conclusion of the
next annual general meeting and to authorise the directors of the Company to determine 
their remuneration.
Special Business
6. To authorise the directors to allot shares of the Company up to a maximum amount
of £2,014,767.
7. To empower the directors to allot shares for cash otherwise than on a pre-emptive basis up to
a maximum amount of £1,208,860.
 BUSINESS REPLY SERVICE
Licence No MB122
Capita Registrars
Proxy Department
PO Box 25
Beckenham
Kent BR3 4BR
2
THIRD FOLD
FIRST FOLD
SECOND FOLD Directors 
Gordon J Hall (Non-Executive Chairman)
James N G White (Chief Executive Officer)
David A Sandilands (Chief Financial Officer)
Gordon B Kuenster (Non-Executive)
Alfred Marek (Executive, appointed 21 April 2004)
Secretary
Sally A Craig
Corporate governance standing committees
Audit Committee
Gordon J Hall (Chairman)
Gordon B Kuenster
Remuneration committee
Gordon J Hall (Chairman)
Gordon B Kuenster
Registered office
Broadwalk House
5 Appold Street
London EC2A 2HA
Tel:  020 7849 6027
Fax: 020 7849 6300
Website: http://www.osmetech.com
Registered number
2849544
Stockbroker and financial advisor 
Evolution Beeson Gregory Limited
The Registry
Royal Mint Court
London EC3N 4LB
Auditors
Deloitte & Touche LLP
Martins Building
4 Water Street
Liverpool L2 8UY
Solicitors
Ashurst
Broadwalk House
5 Appold Street
London     EC2A 2HA 
Registrars and transfer office
Capita Registrars
Northern House
Woodsome Park 
Fenay Bridge
Huddersfield   HD8 0LA
Principal banker
National Westminster Bank plc
41 Greengate Street
Stafford  ST1 2JD
Directors and advisers xx    Osmetech Annual Report 2004