SurfControl plc Annual report 2005
Offices
SurfControl Inc
1900 West Park Drive,
Suite 180, Westborough,
Massachusetts 01581, USA
Tel: +1 (508) 621 3900
Fax: +1 (508) 621 3921
E-mail: sales.us@surfcontrol.com
5550 Scotts Valley Drive,
Scotts Valley , California 95066, USA 
Tel: +1 (831) 431 1400
Fax: +1 (831) 431 1800
E-mail: info@surfcontrol.com 
SurfControl plc
Riverside, Mountbatten Way ,
Congleton, Cheshire CW12 1DY
United Kingdom
Tel: +44 (0)1260 296 200
Fax: +44 (0)1260 296 201
E-mail: surfinfo@surfcontrol.com
SurfControl plc – Singapore
Level 58 Republic Plaza,
9 Raffles Place,
Singapore 048619
Tel: +65 6823 1312
Fax: +65 6823 1481
E-mail: support.sg@surfcontrol.com
SurfControl plc – France
79 Avenue Francois Arago,
92017 Nanterre,
France
Tel: +33 1 46699181
Fax: +33 1 47859140
E-mail: info.fr@surfcontrol.com
SurfControl (Israel) Ltd – Israel
C12 Ramat Yam Street,
Herzeliya,
Israel
Tel: +972 9 957 9912
Fax: +972 9 957 9914
SurfControl (Japan) Ltd – Japan
Kamiyacho MT Building,
14/F , 4-3-20 T oranomon, Minato-Ku
Tokyo 105 001
Tel: +81 3 5404 3818
SurfControl GmbH 
Dorotheergasse 7,
A-1010 Vienna, Austria
Tel: +43 1 513 44 15
Fax: +43 1 513 44 02
E-mail: sales.at@surfcontrol.com 
SurfControl GmbH
Rüsterstraße 13,
D-60325 Frankfurt am Main,
Germany
Tel: +49 69 70 79 86 0 
Fax: +49 69 70 79 86 20
E-mail: sales.de@surfcontrol.com
SurfControl BV
Schouwburgplein 30-34,
3012 CL Rotterdam,
The Netherlands 
Tel: +31 (0) 10 402 0000 
Fax: +31 (0) 10 402 0099
E-mail: sales.nl@surfcontrol.com
SurfControl Pty Ltd
Level 1, 19 Havilah Street,
Chatswood, NSW 2067 
Australia 
Tel: +61 (0)2 9414 0000 
Fax: +61 (0)2 9414 0099
E-mail: sales.au@surfcontrol.com
Beijing SurfControl Network 
Security Co., Ltd
Office T ower C2, 3rd Floor ,
Oriental Plaza, Beijing, 100 738, China
Tel: +86 10 8518 8860
Fax: +86 10 8518 0067
E-mail: info@messagesoft.net
WWW.SURFCONTROL.COM
SurfControl plc
Annual report 2005
■ ENTERPRISE THREAT PROTECTION “This year has seen the attainment of a long
standing goal of becoming a circa $100m
revenue company occupying a leadership
position within our target market. It is 
the culmination of years of work and an
excellent platform from which to launch
into the next stage of the Company’s
development. With the addition of 
Pat Sueltz to our management team 
we have significantly strengthened our
ability to take full advantage of the market
opportunity open to us. Accordingly, I look
forward to the future with confidence.”
Steve Purdham, Chief Strategy Ofﬁcer
■ The Internet is critical to organisations worldwide.
■ It is also their biggest security threat.
■ Malicious threats such as spam, phishing and
spyware constantly and cumulatively assault
companies – with new threats emerging
almost daily.
■ These threats impact employee productivity,
drain network resources, create financial losses 
and increase liability risks.
SURFCONTROL STOPS THESE THREATS
SurfControl is the world’s leading Internet security company
stopping blended and malicious digital threats from
assaulting companies. SurfControl’s Enterprise Protection
Suite™ is the only threat management system with Adaptive
Threat Intelligence™ to continuously filter inbound and
outbound Web, e-mail and IM-P2P traffic. Thus, SurfControl
customers are protected against known, emerging, internal
and customer-specific threats.
Registrars
Capita Registrars
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU
Depository for ADS
Bankers Trust Company
4 Albany Street
New Y ork
New Y ork 10006
United States
Registered Office
Riverside
Mountbatten Way
Congleton
Cheshire CW12 1DY
Bankers
Royal Bank of Scotland plc
2 St Philip’s Place
Birmingham B3 2RB
Solicitors
Hammonds Solicitors
Trinity Court
16 John Dalton Street
Manchester M60 8HS
Brokers
UBS Limited
1 Finsbury Avenue
London EC2M 2PP
Advisers 2005 Highlights
01. SurfControl plc Annual report 2005 www.surfcontrol.com
■ Group turnover increased by 12% to $97.8m
(2004: $87.3m) 
■ EBITDA increased by 6% to $16.7m
(2004: $15.7m)
■ Group invoicing increased by 2% to $108.2m
(2004: $106.6m)
■ Cash balances as at 30 June 2004 increased to $89.0m
(2004: $87.5m) 
■ Gross profit margin of 98%
■ Increased contribution of indirect channel sales
from 58% to 65% for the year
■ Technology acquisitions and share repurchases funded
during the year totalling $26.5m
REVENUE BY GEOGRAPHY
 61% Americas
 20% UK
 9% Europe
 10% Rest of World
REVENUE BY TYPE
18% Licence
82% Subscription
TURNOVER ($m)
05 97.8
04 87.3 3
03 73.2
02 54.2
02 03 04 05
18 Corporate Governance
23 Directors’ Remuneration Report
34 Independent Auditors’ Report to
the Members of SurfControl Plc
35 Group Profit and Loss Account
35 Group Statement of Total
Recognised Gains and Losses
36 Group Balance Sheet
37 Company Balance Sheet
38 Group Statement of Cash Flows
39 Reconciliation of Net Cash Flow 
to Movements in Net Funds
40 Notes to the Financial Statements
63 Unaudited Group Profit and Loss Account
01 Highlights
02 Chairman’s Statement
03 Chief Executive’s Review
04 Operational Review
07 Financial Review
12 Board of Directors
14 Directors’ Report Chairman’s Statement Greg Lock
02. SurfControl plc Annual report 2005
Your company grew revenue and EBITDA,
and generated significant levels of cash 
flow during the year ending 30 June 2005.
We have broadened our product line and
enhanced its function and effectiveness, our
products have won a number of awards and
we have solidified our position as a global
leader in Enterprise Threat Protection. With all
this I am pleased but with one measure of our
performance I am not satisfied; we grew our
invoicing volumes by just 2%, a result which
demands improvement.
Your Board began a thorough review of our
activities in December 2004 and concluded
that we needed to enhance the experience 
of the executive team. The most significant
result of this is the appointment of 
Patricia C. Sueltz as CEO with effect from 
1 July 2005. Pat brings years of experience in
senior executive roles at IBM, Sun Microsystems
where she led the global services business
and most recently SalesForce.com where she
was President of Global Operations. Pat has
lived and worked in the UK as well as the 
USA and has begun the task of upgrading 
our capabilities and  of putting in place 
the  organisational structure, systems and
processes which will allow us to realise our
growth ambitions. We are delighted that an
executive of Pat’s calibre and experience has
chosen to lead us at this exciting time.
We have a very strong platform from which to
accelerate the growth in our market position.
Our balance sheet is strong; we are a leader in
a large and growing market and our product
line has never been stronger. In addition 
our customers, partners and employees 
are valuable assets, for their support I thank
them sincerely.
Great credit for this strength is due to the
outstanding leadership of Steve Purdham
whose passion, insight and entrepreneurial
flair has driven our Company for the last five
years. Steve’s efforts and achievements have
been a major factor in establishing our
leadership in Unified Threat Management,
his foresight in anticipating market needs 
and in driving our response in products and
services have been invaluable.
We are determined to make the investments
in our “go to market” capabilities which will fit
us for future growth. Your Board and the
executive team are committed to make the
changes necessary to compete vigorously
and delight our customers and partners;
we shall be both relentless and rigorous in 
our execution as we strive to make your
Company more valuable.
Greg Lock
Chairman of the Board
5 September 2005
We are one of the world’ s leading IT
security companies with revenues
of close to $100m. 03. SurfControl plc Annual report 2005 www.surfcontrol.com
Dear SurfControl Investor,
You’ve read our Chairman’s letter describing
SurfControl’s FY05 results: Solid fundamentals
– with more focus on growth needed. The
team has the technological vision for all
aspects of information security now and in
the future. We’ve greeted this new year,
driven by our passion for our customers, and
an operational mantra of relentless execution
across the entire company. Strong products,
Customer Focus, Relentless Execution of our
current plans and a keen technological Vision
for the Future are the makings of a solid year
to come. I’m delighted to be a part of the
SurfControl team!
Pat Sueltz
Chief Executive Officer
5 September 2005
The team has the technological
vision for all aspects of information
security now and in the future.
Chief Executive’s Review Patricia C. Sueltz
We’ve greeted this new year,
driven by our passion for our
customers, and an operational
mantra of relentless execution
across the entire company.
WHA T DRIVES US...
■ Our Customers We are passionate about
protecting our customers with inspired,
award-winning solutions.
■ Our Results We are driven to deliver superior
returns for our investors now – and in the future.
■ Our People We strive to create a stimulating,
high-performing environment in which our
employees thrive.
■ Our World Around Us We recognize our
responsibility to the world in which we operate
and act accordingly. Operational Review Steve Purdham
04. SurfControl plc Annual report 2005
The Company’s financial position is strong.
We have no debt, are profitable and strongly
cash generative, and in most areas of the
business we made significant progress.
However, the slow down in new business 
in the Americas has caused disapointingly
low billings growth.
Growth is the main challenge and focus 
of our attention. With the convergence 
of the market towards Unified Threat
Management, our market positioning and
messaging, and the strength of our award
winning technologies, we firmly believe
that we have a solid foundation to attain 
and recapture growth.
We are very excited to have recruited 
Pat Sueltz as CEO, who brings a new level 
of experience and expertise to drive the
business  in a growing market where
SurfControl enjoys a strong market position.
Changing Threat Landscape is
driving Market Change – and
enhances opportunity.
The Internet is critical to organisations
worldwide. It is also their biggest security
threat. Organisations are assaulted daily by
an ever-increasing, complex host of threats
targeting their computer networks. Yesterday
it was porn, web abuse, viruses and spam.
Today it’s phishing and spyware. Tomorrow,
it will be something else. Once spawned,
these threats are cumulative and often
morph into something new.
Once these threats were pests or
distractions, now they are
malicious hazards.
With inadequate protection, the success
organisation is jeopardised by significant
productivity and financial losses, hijacking of 
network resources and increased legal
liability. With the proliferation of wireless
technologies, the boundaries of the
organisation disappear. It is now easier than
ever for these malicious threats to enter an
organisation, rendering traditional security
technologies ineffective.
Regulatory compliance and information
confidentiality are high on CEO agendas.
Threats from ”outbound” traffic such as sent
e-mails, attachments, and instant messaging
are as serious as traditional inbound threats.
This has led to the development of a new
approach so that organisations have
maximum protection from the threats from
the minimum number of vendors. This type
of approach, and this market, is known as
Unified Threat Management.
SurfControl has evolved into one of the
leading Internet security companies,
protecting enterprises from bi-directional
threats with multiple layers of protection.
We have invested in the quality, effectiveness
and design of our products such that we can
deliver more layers of threat protection to our
customers. These layers continuously manage
inbound, outbound and internal Internet-
based traffic to stop known, emerging and
customer-specific threats.
We have signiﬁcantly invested in
increasing the quality, effectiveness
and appeal of our products.
80%
By 2008, 80% of Firewall
Appliances will be Uniﬁed
Threat management
Appliances  (Source: IDC 2004) 05. SurfControl plc Annual report 2005 www.surfcontrol.com
SurfControl has redefined traditional filtering
to encompass the ever-increasing and
cumulative impact of Internet blended
threats. We have merged our award winning
products into our new Enterprise Protection
Suite™, which continuously expands an
organisation’s layers of threat protection,
eliminating the need to deploy and manage
multiple products from multiple vendors.
SurfControl differs from and complements
other Internet Security themes by focusing on
both the content and protocols that are sent
and received over web, e-mail, IM and P2P
mechanisms – delivering higher quality“Best of
Breed” protection in these areas. SurfControl’ s
layered threat protection stops porn, viruses,
phishing, spam, spyware and company specific
threats from coming into the business. It also
keeps confidential, non-compliant and legal
liability items from going out of the business.
Another significant area of progress has been
the strengthening of our Adaptive Threat
Intelligence Service™. This is a combination
of technology, people and historical
databases which constantly monitors the
Internet for existing and emerging threats.
This service produces daily updates to
protect our customers effectively and
efficiently, and underpins our subscription
model providing for our increasing financial
forward visibility and strong cash generation.
SurfControl’s Adaptive Threat
Intelligence Service™ powers the
SurfControl Enterprise Protection
Suite™ to proactively identify and
stop threats as they attempt to
enter or exit an enterprise.
Centrally administered policies can be
defined to ensure that the right level of
protection is delivered at a company, group,
or individual level, with relevant graphical
reporting systems to identify risk areas, trends
and overall usage. Protection is delivered at
the perimeter, network and endpoint, even 
if that endpoint is a mobile PC. SurfControl
customers avoid significant business
downtime that might impact productivity
and the bottom line, while also limiting their
legal liability and ensuring regulatory
compliance and confidentiality.
During the year we acquired SpyWare
technology from Apreo Limited. This
acquisition is part of our response to 
the changing nature of threats, and has 
already enabled the launch of a major new
component, Enterprise Threat Shield which
delivers end point security protecting
companies from the impacts of spyware,
games, IM and P2P .
Business development and 
new customers
We have added over 4,000 customers during
the year with more penetration into larger
enterprises than ever before.
New customers include Camelot, Royal
Skandia, Arriva, Avis, the British Library, Hilton
Group plc, Lovells, Roehampton University
and Cable and Wireless.
Given our subscription model, each new
customer delivers longevity and future
revenue. The integration of our products 
into the Enterprise Protection Suite will 
also provide a strong platform to sell more
product and services to the installed base.
Partnership has been a key part of our business
development strategy. Today we partner with
the world’s major organisations as technology
or OEM partners, including BlueCoat, Cisco,
IBM, Juniper, Microsoft, Nokia, Finjan, GT A,
Openwave and PowerNet.
>>>
SurfControl’ s e-mail protection can be delivered 
as hardware.
Over the years, organisations have had to deal with an ever increasing number of threats.
SurfControl has achieved industry recognition for its technology. SurfControl is developed for
Microsoft’ s Internet Security
and Acceleration Server.
SurfControl’ s Enterprise Protection Suite protects organisations 
from multiple threats.
Operational Review continued
06. SurfControl plc Annual report 2005
Appointment of Pat Sueltz as
Chief Executive Officer
In order to capitalise on our global position 
in the Internet Security arena, we decided
some time ago that we required a world class
executive with the relevant experience and
knowledge to drive the Company forward 
to its next stage of development. I was
therefore delighted that we were able to
announce the appointment of Pat Sueltz as
our new Chief Executive Officer effective from
30 June 2005. She has an excellent pedigree
and I believe we are fortunate to attract
someone of this calibre to SurfControl. I look
forward to working with Pat in my new role
where I can focus purely on strategy and
technological direction.
Outlook
This year has seen the attainment of a long
standing goal of becoming a circa $100m
revenue company occupying a leadership
position within our target market. It is the
culmination of years of work and an excellent
platform from which to launch into the next
stage of the Company’s development. Whilst
we have not delivered the levels of growth
we might have wished for this year, we are
extremely well positioned to take advantage
of the opportunities in this market and
leverage our current position. With the
addition of Pat Sueltz to our management
team we have significantly strengthened our
ability to take full advantage of the market
opportunity open to us. Accordingly, I look
forward to the future with confidence.
Steve Purdham
Chief Strategy Officer
5 September 2005
SurfControl customers avoid 
signiﬁcant business downtime
that can impact productivity.
$1 00m
This year has represented an
attainment of a long standing
goal of becoming a circa
$100m revenue company. Financial Review Simon Wilson
07. SurfControl plc Annual report 2005 www.surfcontrol.com
The financial results for 2005 reflect the
underlying strength of SurfControl’s annuity-
based business model. The Group continues
to have no debt, and generates profits with
strong levels of operating and free cash flow.
The deferred income position has continued
to grow and provides a high visibility of
future turnover.
At the same time the growth in invoicing 
(a more immediate measure of sales activity)
has slowed and is currently below the industry
growth rate as a whole. The low rate of growth
in invoicing has primarily arisen from a slow
down in the levels of new business growth in
the Americas. The strength of SurfControl’ s
business model and hence its balance sheet
provides financial stability upon which to
rebuild our invoicing growth rates in the future.
It also provides financial resources to continue
investing in new technology and capital
projects, as well as returning cash to our
investors through stock purchases.
During the year the Group has again
strengthened its position in the Enterprise
market and has steadily improved its renewal
rates with its customers. It has also diversified 
its business mix both geographically outside 
of the Americas, and with products to
complement Web filtering. Currently 39% of
revenue is generated outside of the Americas
and the Group sells a range of web, e-mail, and
spyware products within its Enterprise
Protection Suite.
The challenge of rebuilding invoicing growth
rates is central to the Group’s business strategy.
The strength of the Group’s financial position
will underpin the actions necessary to meet
that challenge.
Acquisitions
On 28 February 2005, the Group acquired
spyware and extended threat technology
from Apreo Limited. The technology controls
file and application distribution in order to 
secure enterprise networks from threats
arising from spyware, games, IM, P2P , music,
games, etc.
The key terms and the accounting for the
acquisition are set out on pages 47 and 48.
The operational results relating to the
acquired assets were consolidated from the
effective date of the acquisition but were not
significant to the results of the Group and
have been included in continuing operations.
Intangible assets arising on consolidation will
be amortised over a 24 month period, and this
started in the third quarter of the year under
review. The purchase consideration was
settled in cash.
Exchange rate fluctuations
The reporting currency of the Group is the
US dollar, indicative of the principal trading
region and hence currency of the Group.
Several other currencies are used for trading
areas outside of the Americas. The Group is
therefore exposed to exchange differences
arising from the translation of the underlying
regional financial statements to the Group’s
reporting currency of the US dollar. The
business has significantly expanded in non-
US denominated currency regions over the
period thereby increasing the potential
exposure to translation differences. The
Group however is not exposed to significant
realised exchange differences arising from 
>>>
An attractive business model,
leading to a sound balance sheet. Financial Review continued
08. SurfControl plc Annual report 2005
day to day transactions, as its policy is to
conduct and settle the majority of trading
transactions in the relevant currency of the
geographic region.
It is also the Group’s policy to seek to
minimise the level of assets and/or liabilities
held in currencies other than the trading
currency of the entity to which such assets
and liabilities relate. In this way the Group
minimises its exposure to mark-to-market
adjustments at any given balance sheet date.
The relative weakness of the US dollar has
had a number of translation effects on the
financial statements in 2005, none of which
have been material.
Turnover
Group turnover increased by 12% to $97.8m
(2004: $87.3m) (2003: $73.2m). All Group
turnover arose from sales of the Group’s
Enterprise Protection Suite of products:
A unified set of web, e-mail and messaging
security solutions. Growth rates outside the
Americas remained strong as did customer
renewal rates throughout the world.
However the rate of growth in Group
turnover in financial year 2005 was less than
in previous years because of slower new
business growth rates in the Americas.
Invoicing, and to a lesser degree turnover,
continued to exhibit patterns of seasonality
within the year, with Q2 and Q4 typically
producing stronger sequential rates of
growth than Q1 and Q3. The Enterprise
sector is the key target market and customer
segment of the Group and includes the
licensing of technology via software
developer kits to Original Equipment
Manufacturers (“OEMs”). OEM turnover
was $3.0m (2004: $4.0m) (2003: $4.0m).
OEM turnover decreased by 25%, as the
Group was in transition from historical 
OEM contracts to a combination of 
revenue share or “meet in the channel”
business relationships.
The charts below show the percentage of
turnover by destination for the Americas and
non-Americas geographic areas for each of
the three years under review. The Americas
remains the Group’s largest market and
generated $59.8m or 61% of the overall Group
turnover. Non-Americas however exhibited a
high annual growth rate in turnover of 27%,
compared to 4% for the Americas. This reflects
investment in sales and marketing in the
various regions around the world outside of
the Americas, and the decline in rates of new
business in the Americas.
Invoicing and deferred income
The Group invoiced $108.2m in the year,
a 2% increase on invoicing of $106.6m for 
the financial year 2004 (2003: $92.1m).
A proportion of the Group’s invoicing is 
not immediately recognised as turnover,
and is deferred over the period of the
contract to which it relates. Such deferred
income typically relates to threat database
subscriptions and software maintenance
contracts. Full details of the Group’s
accounting policies, including those relating
to turnover and deferred income, are given
in note 1 to the financial statements. As at 
30 June 2005, deferred income increased by
The Americas remain the Group’s
largest market and generated
$59.8m or 61% of the overall 
Group turnover.
■ Americas      ■ Non-Americas
2005
61% 39%
66% 34%
71% 29%
2004
2003 09. SurfControl plc Annual report 2005 www.surfcontrol.com
13% to $84.9m (2004: $75.0m) (2003:
$54.3m). Of the carrying balance $57.0m,
or 67%, (2004: $49.0m, or 65%) (2003:
$37.5m, or 69%) is due to be released to
turnover over the year to 30 June 2006.
The volume and proportion of the Group’s
business generated via its indirect channel
partners continued to increase in the year.
The Company views this progress as key
success factor in achieving scalable and
profitable growth. The chart below shows
the Group’s invoicing profile by channel
segment for each of financial years
under review.
Selling and distribution 
The Group’s largest area of expenditure is
that of selling and distribution. Costs in this
section of the business amount to $47.4m
(2004: $44.0m) (2003: $39.7m). The business
became more efficient in 2005, with these
costs declining to 48.4% of turnover (2004:
50.4%) (2003: 54.3%), reflecting growth
economies of scale, as well as management
of expenditure. It is management’s
intention to continue to seek economies
of scale combined with more effective
management and leverage of global sales
and marketing costs through common
global messaging, improved sales channel
performance, and increased sales of
multiple or bundled products within the
Enterprise Protection Suite.
The main areas of increased spend compared
to prior years were salaries and benefits for
more experienced sales management
and staff recruited in the period. Overall
headcount was 309 at 30 June 2005
(2004: 309) (2003: 259).
Research and development (“R&D”)
R&D expenditure increased to $13.0m (2004:
$9.7m) (2003: $7.5m) being 13.3% of turnover
(2004: 11.1%) (2003: 10.3%). Cost efficiencies
continue to be achieved through location of
staff in lower-cost employment areas within
the Group relative to the US, and outsourcing
of certain non-core activities, enabling this
increased R&D investment to be targeted 
at key growth areas such as spyware and
appliances. The associated increases in salary
and benefit costs is the principal area of
increased spend compared to prior years.
Headcount increased by 13% to 153
employees at 30 June 2005 (2004:136)
(2003:113).
Other administrative expenditure and
intangible asset amortisation
Other administrative expenses were $19.0m
(2004: $16.8m) (2003: $14.6m), holding steady
at 19.5% (2004: 19.3%) (2003: 19.9%) of
turnover. These expenses have kept pace 
with turnover growth in order to support 
the expansion of infrastructure necessary to
support an expanded global organisation with
a growing portfolio of products. Headcount
increased 3% to 79 (2004: 77) (2003: 71).
The acquisition of assets from both SecureM
Inc in April 2004 and from Apreo Limited in
February 2005 gave rise to an amortisation
charge of $7.8m during the year (2004: $1.4m).
The unamortised balance of these intangible
assets as at 30 June 30 2005 was $9.8m.
Equity based compensation
Equity based compensation comprises 
an employment tax provision and costs in
respect of long term incentive plan share
grants (“L TIPs”). The equity employment tax
provision relates to the potential tax liability
that may crystallise on the exercise of
outstanding options and L TIP shares held 
by directors and employees at 30 June 2005,
based on the then closing middle market
share price of £4.59 (2004: £6.10) (2003: £6.38).
The L TIP share charge of $0.1m (2004: $nil)
(2003: $nil) has been credited to profit and
loss reserve. The balance sheet employment
tax provision of $0.16m (2004: $0.45m) (2003:
$0.54m) declined over the year, reflecting 
the reduction in the Company’s share price.
Exceptional item – Onerous lease
Surfcontrol, Inc, the Company’s principal
subsidiary, vacated its office for alternative 
>>>
■ Channel partners      ■ Direct
2005
65% 35%
58% 42%
49% 51%
2004
2003 Financial Review continued
10. SurfControl plc Annual report 2005
accommodation during the year. As vacant
possession was retained, rent accruing over
the remaining lease term of $1,648,000 has
been charged to the profit and loss account.
Profit on sale of a business
The Group sold its MultiView business unit 
in February 2001 and has in prior years
received deferred payment of sale proceeds.
Net proceeds recognised in the profit and 
loss account were $nil in 2005 (2004: $0.31m)
(2003: $0.38m). Under the terms of the sale
agreement, no further proceeds will 
be received.
Profit before taxation
Profit before taxation declined in the financial
year 2005 to $7.6m (2004: $14.4m) (2003:
$8.9m). This was a direct result of the increase
in intangible asset amortisation charges arising
from the SecureM and Apreo transactions.
Taxation
A net tax charge of $1.2m was recorded for
the year (2004: $2.9m) (2003: $2.5m), and
represents an effective rate of 15% of 
pre-tax profits. Note 8 to the financial
statements on page 46 gives details 
of matters affecting the current tax 
charge, and how it reconciles to the 
charge predicted by applying the UK
standard corporation tax rate to the 
Group profit on ordinary activities 
before taxation.
In accordance with tax authority
requirements around the world and 
OECD guidelines, the Group follows
documented arms-length transfer pricing
methodologies to reflect both the domicile
of its intellectual property and the various
functions performed on behalf of other
Group entities. The Group is currently
generating corporation tax liabilities in 
the UK, Australia and certain US states.
This regional pattern is expected to
continue for the foreseeable future.
Deferred tax assets of $4.5m (2004: $6.9m)
(2003: $4.2m) have been recognised in the
Group balance sheet. The reduction in the
value of deferred tax assets principally
reflects a prudent and therefore reduced
assessment of the forecast rate at which US
tax losses are expected to be utilised in the
foreseeable future. This assessment reflects
the reduced level of current year invoicing 
in the US.
Liquidity, capital resources and
treasury management
The Group continues to be highly cash
generative with strong levels of both
operating and free cash flow relative to
its levels of profits. Net cash inflow from
operating activities (before cash flows
from exceptional items) was $23.8m (2004:
$32.4m) (2003: $24.1m). Net cash inflow
from returns on investments and servicing
of finance was $2.7m. (2004: $1.8m) (2003:
$0.7m). The net inflow from returns on
investments in all years came primarily 
from bank interest, which amounted to
$2.7m (2004: $1.8m) (2003: $0.8m). The
Group funded the purchase of all tangible
fixed assets in the year from its own cash
resources, and as in previous years has
minimal finance lease commitments. Cash
outflow from capital expenditure was
relatively stable at $2.2m (2004: $2.3m) 
(2003: $1.6m). Overall free cash flow
remained strong at $21.9m (2004: $26.6m)
(2003: $22.1m) as set out in the table opposite.
The Group continues to be highly
cash generative with strong levels
of both operating and free cash flow
relative to its levels of profit. 11. SurfControl plc Annual report 2005 www.surfcontrol.com
Net cash outflow from financing was $11.6m
(2004: Inflow $2.9m) (2003: Inflow $1.2m).
During the year the Company significantly
increased its treasury share programme,
spending $11.8m of cash in purchasing its
own shares (2004: $0.8m) (2003: $nil). The
Board believes that purchase of own shares
is in the best interests of the Company’s
shareholders and plans to continue to do
so. At 30 June 2005 the Group had total
cash holdings of $89.0m (2004: $87.5m)
(2003: $61.7m) earning a current weighted
average rate of return on closing cash of
2.8% p.a (2004: 2.3%) (2004: 2.4%). Net
interest receivable and similar items,
primarily bank interest, was $2.5m (2004:
$1.9m) (2003: $1.1m) reflecting yield
enhancement from both rising interest 
rates in the US and improvements in
treasury management.
Employee share-based incentive schemes
The potential dilution of equity from
granted options varies to the extent 
that they are in-the-money or under water.
As at 30 June 2005, there were 1,036,840
options with an exercise price at or below
£4.59, which was the closing middle 
market price on that day. These options
represent 3.3% of the issued share capital 
as at 30 June 2005. In addition there 
are a further 2,108,598 outstanding options
with a grant price above £4.59 which will 
dilute equity if the share price rises. During
the year the Company issued rights to
272,881 shares under its Long Term
Incentive Plan.
Transition to International Financial
Reporting Standards (“IFRS”)
Listed companies in the UK are required 
to adopt IFRS for accounting periods
commencing on or after 1 January 2005. The
Board considers that it will be ready to adopt
IFRS compliant accounting policies during
the financial year 2006, and be in a position 
to prepare Group IFRS financial statements 
for that year. The Board intend to maintain 
the Group’s voluntary practice of presenting 
a three year profile giving an IFRS transition
date of 1 July 2003. Quarterly comparative 
re-stated financial statements will also be
prepared for fiscal year 2005 to maintain 
the quarterly reporting profile for investors
and analysts.
As at the date of this Report the expected
effects of IFRS are as set out in the Group
Annual Report for 2004.
In accordance with emerging best practice
and the recommendations from the “100
Group of Finance Directors” a reconciliation 
of the 2004 and 2005 financial statements
from UK GAAP to IFRS will be published prior
to the release of the Group’s first quarter 2006
IFRS financial statements in November 2005.
Summary
Rebuilding invoicing growth rates is central 
to the Group’s business strategy. These
financial statements demonstrate and explain
the strength of the Group’s financial position,
which has been generated by its annuity-
based business model. This strong financial
position will underpin the actions necessary
to achieve our goals.
Simon Wilson
Chief Financial Officer
5 September 2005
2005 2004 2003
$m $m $m
Net cash flow from operating activities (before exceptional item) 23.8 32.6 24.1
Cash outflow from exceptional item (0.7) ––
Returns on investments and servicing of finance 2.7 1.8 0.7
Taxation (1.7) (5.5) (1.1)
Net cash outflow from capital expenditure and financial investment (2.2) (2.3) (1.6)
Free cash flow 21.9 26.6 22.1
Group Free Cash Flow Board of Directors
12. SurfControl plc Annual report 2005
Greg Lock 
Non-executive Chairman
Greg Lock was appointed to Non-executive
Chairman on 9 September 2003 after serving
on the Board as Non-executive Director since
17 October 2000. Until April 2000, Greg 
lived and worked in the United States,
France, Germany and the United Kingdom 
as IBM’s Global General Manager, Industrial
Sector. In this position, he had worldwide
responsibility for IBM’s business with
companies in the Automotive, Aerospace,
Electronics, Chemical, Petroleum and other
manufacturing industries representing
approximately 15% of the company’s
revenues. In addition to SurfControl, Greg
serves as Director of Target Computer Group
Limited, Chairman of Nexagent Limited and
Director of Liberata Limited.
Pat Sueltz
Chief Executive Officer
Pat Sueltz joined SurfControl in 2005 from
SalesForce.com where she was President,
Global Operations. Prior to this Pat was
Executive Vice President of Services and a
Corporate Officer of Sun Microsystems, Inc for
four years having previously held a number of
senior positions at IBM, including Technical
Assistant to the Chairman and CEO, and a two
year assignment in the UK early in her career.
Pat has also served as a board member of
Delphi and Amgen, both Fortune 500
companies. Pat is based in SurfControl’s US
Headquarters in Scotts Valley, California.
Steve Purdham 
Chief Strategic Officer
Steve Purdham co-founded the vision,
architecture and development of
SurfControl in 1996. It was this vision and
opportunity that enabled the Company 
to enter the public arena in 1998 and
experience rapid growth.
Since mid 90s he has strategically worked
with major worldwide software organisations
to understand, analyse and define the
exploding Internet marketplace. He has been
a frequent conference speaker on the subject
of the Internet and has contributed to several
books and papers on the subject.
As President and then CEO of SurfControl
he was successful in building the operation,
and driving the planning, development,
marketing and execution of the significant
growth of the business. As CSO and CTO,
today Steve continues to drive SurfControl’s
products forward and provides the
Company's future vision.
Simon Wilson
Chief Financial Ofﬁcer 
Simon Wilson joined SurfControl in 2000 and
was appointed as Chief Financial Officer in
September 2001. He has served on the Board
of SurfControl since July 2001. Simon joined
SurfControl from KPMG's US Corporate
Finance Practice, where he specialised in
advising software and IT services companies
on all aspects of domestic and cross-border
Top row: Greg Lock, Pat Sueltz, Steve Purdham, Simon Wilson. Bottom row: Patrick Jolly, George Hayter, Rene Schuster and Jane Tozer. acquisitions, sales, divestitures and financings.
From 1989 to 1994, Simon held a variety of
finance director roles at subsidiaries of Misys
plc after having spent five years with Ernst &
Young. Simon is a member of the Institute of
Chartered Accountants in England & Wales,
a member of the Chartered Institute of
Marketing, and holds a Bcomm (Honours)
from Birmingham University, England.
Patrick Jolly 
Executive Vice President,
Corporate Development
Patrick Jolly was appointed to the Board in
July 2001. Patrick is responsible for global
corporate development. Prior to joining
SurfControl, he was a partner specialising in
corporate finance in Hammonds, a UK based
international law firm, where he had a
particular focus on advising technology
companies in relation to fundraisings,
mergers and acquisitions.
George Hayter 
Senior Non-executive Director
George Hayter was previously Managing
Director of the Trading Markets Division of the
London Stock Exchange where he was earlier
responsible for the information and trading
systems including implementation of TOPIC,
SEAQ and SEAQ International. Since 1990 he
has acted as an independent consultant to a
number of overseas stock exchanges and
other UK and overseas organisations. George
is currently non-executive chairman of
E*Trade Financial Inc. (a New York Stock
Exchange listed Internet broker and bank).
Rene Schuster
Non-executive Director
Rene Schuster was appointed to the Board 
as Non-executive Director in November 2003.
Rene is currently Global Director of Multi-
National Corporates within the Vodafone
Group. Previously Rene was Senior Vice
President and General Manager of Hewlett-
Packard Company where he led the
Consulting and Integration unit of HP
Services. Formerly, Rene joined Compaq in
July 2000 as the Chief Executive of Compaq
UK and Ireland (the second-largest Compaq
subsidiary after North America) and Vice
President of Compaq Computer Corporation.
Rene joined Compaq from KPMG
Management Consulting, where he served 
as Chief Operating Officer in the Europe
Middle East and Africa region. Rene serves 
as Director of Hudson Highland Group, Inc.
Jane T ozer
Non-executive Director
Jane Tozer was appointed to the Board as
Non-executive Director in November 2003.
Jane's current non-executive directorships
include: Retail Decisions plc, The Pensions
Service, F&C Smaller Companies Investment
Trust plc, JP Morgan Fleming Income &
Growth plc. Jane is co-founder and head of
the Information and TMT Non-Executives’
Association (ITNEA) and is a Trustee 
of the Worshipful Company of Information
T echnologists’ Charitable Trust. Jane began
her career at IBM, spending 14 years there
before moving to FI Group (now Xansa plc) as
Business Development Manager. She then
moved to Softwright Systems Ltd., where she
held the position of Chief Executive until 1997
– taking the company from start-up through
to a successful trade sale to a NASDAQ
quoted company.
13. SurfControl plc Annual report 2005 www.surfcontrol.com The directors present their Annual Report for the year ended 30 June 2005.
Principal activities and offices
The Group’s principal activity is the development and sale of Internet security products that provide enterprise threat protection, shielding organisations
from known and emerging Internet dangers through Layered Threat Protection
SM
.The Company has redefined traditional “filtering” into a unified set of Web,
e-mail and messaging security solutions that continuously filter inbound and outbound Internet traffic to eliminate spam, spyware, phishing and Web and 
e-mail abuse. SurfControl provides Adaptive Threat Intelligence
SM
from its Global Threat Experts
SM
to respond quickly with automatic, proactive security
updates to protect customers. “SurfControl” is the Group’s primary brand for its Internet security products.
In the third quarter of the year the Group acquired enterprise spyware and extended threat technology from Apreo Limited, for a total estimated cost 
of $7.0m. In the fourth quarter the Group successfully launched its own enterprise threat protection product incorporating this technology.
The Group’s principal go-to-market distribution channel is channel partnerships with resellers, distributors, and a range of OEM partners. These partners may
sell the Company’s products individually or incorporated into a broader unified threat management solution. The Group also sells its products directly via
inside sales and via e-commerce from its website.
Financial results and review of developments
The results for the year are set out in the attached audited financial statements on pages 35 to 62. The directors do not recommend the payment of a
dividend and the retained profit for the year of $6,445,000 is transferred to reserves.
A full review of the operations of the Group during the year, together with an indication of current and future developments can be found in the Chairman’s
and Operating Review statements on page 2 and pages 4 to 6, and in the Financial Review on pages 7 to 11.
Treasury share purchases
During the financial year the Company acquired a total of 1,089,500 of its own 10p ordinary shares for treasury at an aggregate cost of $11,525,000. The
purchases were completed at an average price of £5.71 ($10.58) per share. Following these purchases the Company holds 1,195,500 shares in treasury
representing 3.84% of issued share capital at 30 June 2005. At this date the Company has remaining authorisation up to the conclusion of the forthcoming
Annual General Meeting to purchase 2,474,174 ordinary shares. The Board believes that the acquisition of treasury shares is an effective use of shareholder
funds given the Company’s current share price.
Research and development
The Group’s activities in research and development are discussed in the Operating Review statement on pages 4 to 6. A charge of $12.96m has been
recorded in the Group profit and loss account during the period for research and development.
Board structure
The directors who have held office during the year and their positions on the Board are as follows:
Greg Lock
3
Non-executive Group Chairman and Chairman of the Nominations Committee
George Hayter
1,2,3
Non-executive Director and the Senior Non-executive Director
Rene Schuster
1,2,3
Non-executive Director and Chairman of the Remuneration Committee
Jane E Tozer MBE
1,2,3
Non-executive Director and Chairman of the Audit Committee
Steve Purdham Group Chief Executive (to 30 June 2005)
Pat Sueltz Group Chief Executive (from 30 June 2005)
Simon Wilson Group Chief Financial Officer and Company Secretary 
Patrick Jolly President EMEA (Europe Middle East Asia) and World Wide Operations outside of America 
Kevin Blakeman President Americas Operations (resigned 26 October 2004)
1 Member of the Remuneration Committee
2 Member of the Audit Committee
3 Member of the Nominations Committee
Pat Sueltz was appointed to the Board as Group Chief Executive on 30 June 2005. Steve Purdham became Chief Technical Officer and Chief Strategy Officer
on the same date. Patrick Jolly became Executive Vice-President for Corporate Development and Legal Affairs on 6 July 2005.
The directors retiring by rotation are Greg Lock, George Hayter and Steve Purdham who, being eligible, offer themselves for re-election. In addition Pat Sueltz
was appointed during the financial year offers herself for re-election at the forthcoming Annual General Meeting.
A brief description of the recent business experience of directors serving during the period is given on pages 12 to 13.
Directors’ Report
14. SurfControl plc Annual report 2005 Directors’ interests
Details of directors’ interests in the ordinary share capital of the Company, together with their option and long-term incentive plan holdings are given in the
Directors’ Remuneration Report on pages 23 to 33.
None of the directors had a material financial interest in any contract of significance, other than a service contract, with the Company or any of its direct and
indirect subsidiaries at any time during the financial year.
Substantial shareholders
As at 5 September 2005 the Company had been notified under sections 198-202 Companies Act 1985 that the following shareholders had direct or indirect
interests of 3% or more of the current issued ordinary share capital of the Company.
Ordinary 
shares held % of total
on date of ordinary
Shareholder notification shares
1
Porter Orlin, LLC 2,783,420 8.95
Tiger Technology Performance, LLC 2,332,239 7.50
Fidelity International Limited 2,141,007 6.88
Merrill Lynch and Co, Inc 1,915,527 6.16
The Goldman Sachs Group, Inc 1,903,973 6.12
Wellington Management Company, LLP 1,765,683 5.67
Barclays Plc 1,409,946 4.53
Herald Investment Trust plc 1,094,200 3.52
JANA Partners LLC 1,047,141 3.37
Legal and General Investment Management Limited 957,526 3.08
1 Based on 31,114,572 ordinary shares in issue at 5 September 2005.
Employment policy and involvement
The Group believes in developing and maintaining a diverse, multi-talented and highly motivated workforce. The Group is therefore committed to providing
equal employment opportunities by establishing discrimination-free recruitment and employment practices, and maintaining an environment that is free
from any form of discrimination. The Group companies give full consideration to all employment applications from disabled persons. Disabled employees,
and employees who may become disabled during the course of their employment with the Company or Group, are eligible to participate in all appropriate
training and career development generally available to staff.
The directors acknowledge their responsibilities to consult staff and communicate relevant information to them. All employees have access to the internal
corporate website. The Company also uses other methods of communication such as staff meetings, web casts, video conferencing, instant messaging, and
e-mail, such that the views of employees can be taken into account in making decisions that may affect their interests.
Creditor payment policy
It is Group policy to pay suppliers in accordance with agreed terms and conditions of purchase, provided that the supplier complies with all relevant terms
and conditions. The policy developed is specific to the Group’s businesses and, consequently, adoption of an external code of payment to suppliers is
considered unnecessary. The average time taken to pay purchase invoices by the Group is 28 days (2004: 28 days) (2003: 23 days). Company creditor days
were 26 days (2004: 35 days) (2003: 28 days).
Political and charitable contributions
The Group and Company made no political contributions during the year (2004: $nil) (2003: $nil). Donations to UK charities amounted to $85,108 
(2004: $97,849) (2003: $172,249). In addition the Group donated $9,553 to charities outside of the UK (2004: $10,173) (2003: $4,147).
Directors’ Report
15. SurfControl plc Annual report 2005 www.surfcontrol.com Corporate responsibility
The Group conducts its business having regard to its various stakeholders and the wider community. The directors are committed to a management culture
that promotes the health, safety, and general welfare of employees. As mentioned above full and timely communication is maintained with employees. The
Group aims to foster fair and transparent relations with all its customers, whilst maintaining a clear commercial basis to its business transactions. The Group
ensures payment is made promptly to suppliers, irrespective of their size, unless there are sound business reasons to withhold payment. Group companies
support their communities with involvement in local initiatives, and through charitable contributions. The Board recognises its responsibility to consider
social and environmental issues as these arise and to ensure compliance with relevant local statutory regulations. The Board believes it has adequate
information systems in place to assess any environmental and social concerns that may arise from time to time. These matters will, where relevant, form 
part of the Group’s risk management strategy although as a software developer the Group has no manufacturing facilities that pose environmental issues.
Waste products are recycled in all offices and management aim to ensure responsible use of energy as far as it is economic and practical to do so. The
Group’s website includes a section dedicated to corporate, ethical, employment and environmental issues.
Going concern 
The directors have reviewed budgets and have a reasonable expectation that the Group has adequate resources to continue as an operational business for
the foreseeable future. The financial statements have therefore been prepared on a going concern basis.
Auditors
An ordinary resolution to re-appoint KPMG Audit Plc as auditors of the Company is to be submitted to the forthcoming Annual General Meeting.
Statement of directors’ responsibilities
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 of the Group and of the profit or loss for that period. 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; and
> prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company and the Group will continue in business.
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 have general responsibility for taking such
steps as are reasonably open to them to safeguard the assets of the Company and to prevent and detect fraud and other irregularities.
Annual General Meeting
The Annual General Meeting will be held at Riverside, Mountbatten Way, Congleton, Cheshire CW12 1DY on 20 October 2005 at 11.30am.
Included in the ordinary business of the meeting are resolutions 3 and 4 to re-appoint Greg Lock and George Hayter respectively as Non-executive Directors.
They each have agreements without a specified fixed term, which are terminable by the Company or the director with three months’ notice. Greg Lock has 
a wide experience in the technology sector having previously worked in several countries as IBM’s Global General Manager, Industrial Sector. George Hayter
has a number of contacts in the technology sector through current and past directorships including most recently the E*Trade Group, Inc, which is quoted
on NASDAQ. Neither director holds any executive position and is able to devote the time required of him as a Board director. Greg Lock is the Non-executive
Chairman of the Group. George Hayter is the Senior Independent Non-executive Director.
The biographical details of the directors that are submitted for re-election may be found on pages 12 to 13.
As well as the ordinary business of the Meeting, resolutions will be proposed to renew for a further year the authority to allot un-issued shares in the
Company, to allot shares for cash free from the pre-emption rights set out in the Companies Act 1985, and to give the Company authority to make market
purchases of it shares.
Directors’ Report
16. SurfControl plc Annual report 2005 Resolution 8 will renew the directors’ authority to allot un-issued shares in the Company in accordance with section 80 of the Companies Act 1985.
The resolution authorises the directors to allot shares up to an aggregate nominal amount of £1,659,443 (being one-third of the issued ordinary share 
capital of the Company at one month prior to the date of this notice plus the maximum current options). The authority will expire at the conclusion 
of the next Annual General Meeting of the Company or on the day 15 months from the date of the passing of this resolution (whichever is the earlier).
The directors have no immediate intention to exercise this authority other than in connection with the Group’s employee share schemes.
Under Section 89 of the Companies Act 1985, equity securities in the Company may not be allotted for cash (otherwise than in respect of an employee
share scheme) without first being offered pro rata to existing shareholders, unless the prior approval of the shareholders is given in a general meeting. The
directors consider that it is in the best interests of the Company to renew the relevant authority given at the Annual General Meeting in 2004. Accordingly,
a Special Resolution to this effect is proposed as Resolution 9 in the notice of the Annual General Meeting. The proposed authority will expire at the
conclusion of the next Annual General Meeting of the Company or on the day 15 months from the date of the passing of this resolution (whichever is the
earlier) and permits the directors during this period to issue up to an aggregate nominal amount of £155,572 (representing 5% of the issued share capital 
at one month prior to the date of this notice) without first offering them to existing shareholders.
Under the terms of the Companies Act 1985 and its Articles of Association, the Company has power to purchase its own shares provided that this power has
first been sanctioned by shareholders. Resolution 10 authorises the Company to make purchases of up to 3,111,457 shares (representing 10% of the issued
ordinary share capital of the Company at one month prior to the date of this notice) at a minimum price of 10p and a maximum price (exclusive of expenses)
of not more than 5% above the average of the middle market quotations for the ordinary shares of the Company as derived from the London Stock Exchange
Daily Official List for the 5 business days prior to the purchase. The authority will expire at the conclusion of the next Annual General Meeting of the Company
or on the day 15 months from the date of the passing of this resolution (whichever is the earlier). As at 5 September 2005 (being the last practicable date 
prior to publication of this Report) 3,145,438 options to subscribe for ordinary shares in the Company, pursuant to the SurfControl Executive Share Option
Schemes were outstanding. If exercised as at the date of this document, those options would represent 9.18% of the total issued share capital of the Company
inclusive of shares issued under option. If the full authority to buy back shares is invoked, the same options would represent 10.10% of the total issued share
capital of the Company inclusive of shares issued under option. The fact that the directors are seeking this authority should not be taken as an indication that
the Company will purchase its own shares at any particular price or indeed at all and the directors would only consider making purchases if they believed that
such purchases would be in the best interests of shareholders generally, having regard to the effect on earnings per share.
All of the above resolutions are set out in the separate notice of Annual General Meeting.
By order of the Board
Simon Wilson
Company Secretary
5 September 2005
Directors’ Report
17. SurfControl plc Annual report 2005 www.surfcontrol.com Corporate Governance
Introduction
The Board supports the principles of the 2003 Combined Code on Corporate Governance (“the Combined Code”). As required by the Listing Rules of the UK
Listing Authority this report describes how the Group has applied the principles of section 1 of the Combined Code.
1. The Board of Directors
The Group is controlled by a Board of Directors that currently comprise the four executive directors and four independent non-executive directors 
(including the Non-executive Chairman). The Non-executive Chairman is Greg Lock. The other Non-executive Directors are George Hayter, Rene Schuster,
and Jane Tozer.
The Board’s responsibilities include setting overall business and market strategy for the Group as a whole. This involves approving significant strategic
decisions such as acquisitions, product and market diversification, and capital structure. It also involves approving annual operating budgets and monitoring
performance against budget, establishing a risk framework and setting risk tolerances, and monitoring executive and management performance. All
operational decisions within this business and market framework are delegated to executive management.
George Hayter, Greg Lock, Rene Schuster and Jane Tozer are shareholders in the Company. All the non-executive directors are considered by the Board to 
be independent of the Company and Group, as defined in section A3.1 of the Combined Code. Each non-executive director possesses considerable outside
expertise, and is able to exercise detached judgement in dealing with matters before the Board. The Senior Independent Director is George Hayter, who 
was appointed to the Board as a non-executive director on 15 June 1998. Although George Hayter holds vested share options from January 2000, the Board
does not consider that this affects his ability to exercise independent judgement.
Board meetings were held on nine separate occasions during the year. In advance of each meeting, the Board is furnished with timely information to enable
it to discharge its duties, including inter-alia reports covering local operating performance and activities, a Group operational summary, management
accounts with budget variance analysis, most recent forecasts, and selected periodic status reports on taxation, working capital management, human
resources, information systems, internal control reviews and changes, treasury and strategic matters. Newly introduced in April 2005, the Board also receives
selected periodic in-depth presentations from departmental management as to the functional operations. The non-executive directors also meet from time
to time, outside of Board and committee meetings, without the presence of executive directors.
The Board has adopted a Schedule of Matters reserved for its approval. Directors have access to the advice of the Company Secretary at all times, and may
seek independent professional and legal advice. Although there is no formal training programme, training is provided to directors on induction and from
time to time on request.
All Board directors are subject to re-election in accordance with the Company’s Articles of Association, which require no less than one third of directors 
to be eligible for re-election in each calendar year. A director is also subject to re-election at the Annual General Meeting following their initial appointment 
to the Board.
Professional commitments of the Chairman of the Board
Greg Lock is also chairman of Nexagent Limited and held directorships in Target Group Limited and Liberata Limited throughout the year.
The biographies of all of the Board’s directors, and their continuing outside directorships if any, are set out on pages 12 to 13.
18. SurfControl plc Annual report 2005 Board Committees
There are three committees of the Board, which are:
(a) Remuneration Committee 
The Remuneration Committee consists of the three Non-executive Directors: Rene Schuster (Chairman), George Hayter, and Jane Tozer. Other board
directors and senior Human Resource managers are from time to time invited to attend remuneration committee meetings at the request of the chairman.
The Committee’s responsibilities are to set the remuneration for the executive directors, and to set the remuneration policy for the Group so as to enable the
recruitment and retention of high calibre executives and senior management. The Directors’ Remuneration Report on pages 23 to 33 provides further details
of the Committee’s responsibilities and work. The Committee meets no less than twice each year, and has met four times in the year under review. The full
text of the Committee’s terms of reference may be found on the Company’s website at www.surfcontrol.com/company/corporategovernance.
(b) Audit Committee
The Audit Committee consists of the three Non-executive Directors: Jane Tozer (Chairman), George Hayter and Rene Schuster. In the Board’s opinion, Jane
Tozer has relevant up to date financial experience, and is suitably qualified to chair this committee. Other Board directors and senior accounting managers
are invited to attend audit committee meetings at the request of the chairman.
The Committee is responsible for monitoring all accounting, reporting, control and financial aspects of the executive management’s activities, and for
ensuring that an appropriate risk management framework is in place for the Group. It is also responsible for ensuring that the financial performance of the
Company and Group is properly reported with regard to compliance with UK Company law, accounting standards and best practice requirements of the
Combined Code.
The Committee meets no less than four times a year, and meets with the external auditors each quarter to review their reports in relation to the Group’s
accounts and internal controls. The Committee also reviews significant areas of business and financial risk, and assumptions or judgements made by
management in assessing these risks, and maintains a regular direct dialogue with the finance director. In addition the Committee and/or the chairman
meet periodically with the external auditors without the presence of the finance director or other executive directors. In the year under review, the
Committee met five times.
The Board reviews the need for an internal audit function annually. At present an internal audit function is not considered necessary for a number of reasons:
the size of the Group, the relative simplicity of the nature and type of transactions entered into by the Group, significant executive involvement in the day to
day business, the ongoing improvement of internal controls and the operation of key financial controls via peer review. As the Group increases in size, global
reach, and complexity of business mix, the possible need for an internal audit function will continue to be reviewed at least annually.
The Company has always encouraged open communication between staff, HR, senior management and executive directors. In addition, the Audit
Committee established written guidelines to encourage any employee or executive director to communicate matters of concern directly to the chairman 
or non-executive directors if they wish. These “whistleblowing” procedures were formally adopted on 2 September 2004 and will be reviewed annually to
measure their effectiveness. During the year all contacts made by employees under the policy were recorded in a register and reviewed and discussed at
Board meetings. Appropriate follow up action was taken and recorded in the register.
The Committee is responsible for making recommendations to the Board on the appointment, re-appointment and removal of the external auditors. The
Committee keeps under review the cost effectiveness, independence and objectivity of the external auditors, as well as maintaining a policy governing the
use of external auditors for non-audit services. The policy’s objective is to avoid potential conflicts of interest or circumstances where the external auditor’s
judgement or independence may be compromised, and only to retain the external auditors where their knowledge and expertise provides service over and
above other professional service providers of similar standing. In the year under review, the majority of non-audit services provided by the external auditors
related to tax compliance and planning. Details of the non-audit services, together with their cost, are set out in note 6 on page 45.
The full text of the Committee’s terms of reference, its policy on the use of external auditors for non-audit services, and the whistleblowing policy may be
found on the Company’s website at www.surfcontrol.com/company/investors/corporategovernance.
Corporate Governance
19. SurfControl plc Annual report 2005 www.surfcontrol.com (c) Nominations Committee
The Nominations Committee consists of the Chairman and the three Non-executive Directors: Greg Lock (Chairman), George Hayter, Rene Schuster, and
Jane Tozer. The Committee’s responsibilities are to identify, evaluate and select candidates for Board positions, and to review annually the composition and
size of the Board. It makes recommendations on appointments and changes to the composition of the Board.
During the year under review the Committee recommended one executive appointment to the Board: Patricia C Sueltz as Chief Executive Officer. The
recommendation was accepted by the Board. In making this appointment the Board utilised the services of an external search firm. The prime qualities
sought for the position were integrity, extensive experience in running mid- to large-cap organisations in the technology sector, US experience, and a
demonstrable track record of success.
The full text of the Committee’s terms of reference may be found on the Company’s website at www.surfcontrol.com/company/investors/corporategovernance.
The attendance record at Board and committee meetings for the directors was as follows:
Board Audit Remuneration Nominations
Board Director Held Attended Held Attended Held Attended Held Attended
Greg Lock 9 9 n/a n/a n/a n/a 2 2
George Hayter 99554422
Rene Schuster 97554321
Jane Tozer 99554422
Pat Sueltz* – – n/a n/a n/a n/a n/a n/a
Steve Purdham 9 9 n/a n/a n/a n/a n/a n/a
Patrick Jolly 9 9 n/a n/a n/a n/a n/a n/a
Simon Wilson 9 9 n/a n/a n/a n/a n/a n/a
Kevin Blakeman** 2 2 n/a n/a n/a n/a n/a n/a
Reasons for non-attendance were vacation and other business commitments. Where n/a appears the director was not a member of the relevant Board
committee.
*Pat Sueltz was appointed a Director on 30 June 2005 and as a consequence did not attend any meetings in the year as a director.
** Kevin Blakeman resigned as a Director on 26 October 2004. He attended all Board meetings whilst a director.
Annual performance evaluations
The Combined Code requires that the Board conducts formal annual performance evaluations of the Board as a whole, the individual non-executive
directors, the Chairman, and the Board committees. The Board conducted an evaluation of its effectiveness in a separate meeting with all members present.
Attendance at Board and Committee meetings was reviewed and each Board member provided his or her assessment of the Board’s performance. Input
was obtained from the auditors on the performance of the Audit Committee.
Whilst the assessment results were broadly positive, select areas for improvement were identified, together with specific recommended actions. The Group
is committed to continuous improvement in its business operations, and this same ethos applies to the Board.
Separately the Senior Independent Director conducted an assessment of the performance of the Chairman with input from each member of the Board. The
Chairman was absent from the discussions. This assessment was shared with the Chairman and suggestions made for improvement were accepted by him.
For the year under review, as in prior years, the executive directors’ performance is appraised by the Chairman (who also obtains input from the
independent Non-executive Directors) in conjunction with the Chief Executive. This follows the Chief Executive’s own evaluation of their performance 
and contribution to the Company. The Chairman also evaluates the performance against objectives of the Chief Executive. The Remuneration Committee
considers these evaluations in their decisions of awards of bonuses for the year, and in the setting of future compensation for the executive directors.
Corporate Governance
20. SurfControl plc Annual report 2005 2. Shareholder relations
The Group keeps in contact with investors through a regular communication programme involving a variety of analyst, institutional and retail shareholder
meetings, recorded telephone conference calls, and technology bank conference presentations. On a pre-set schedule, the Group publishes unaudited
results each quarter via Reuters News Service. The Group’s annual and interim reports are circulated to shareholders, all known interested parties, and
through the Financial Times/Daily Telegraph subscription service. The pre-set publication schedule, together with downloadable copies of all financial results
and summaries of operating metrics is also published on the Group’s website. The Group also publishes on the Company’s website downloadable copies of
all presentations made to investors or analysts. These activities are an integral part of the Company’s policy of maintaining a high level of transparency with
investors and complying with its obligations as a listed company. The Company also hosts an annual Analyst Day where non-financial aspects of the Group’s
operations and products are discussed. The CEO and Finance Director are the primary points of contact for shareholder relations, and the Chairman and
Senior Independent Director are available on an ongoing basis to meet with major shareholders, and will promptly respond to any ad hoc requests for
meetings. In addition, the Chairman extends an offer to meet all of the Company’s top 10 major shareholders each year, together with the CEO. Regular
feedback is given to the full Board on governance, strategy or any other significant issues that have been raised by institutional shareholders.
Save in exceptional circumstances, all Board directors attend the Annual General Meeting and shareholders are invited to ask questions concerning the
formal business, or meet with the Board afterwards for more general questions. Notice of the meeting and any related documents are sent to shareholders
at least 20 working days in advance of the meeting. The level of proxy votes lodged for each resolution is announced at the meeting and a copy of the
related Stock Exchange announcement is available at www.surfcontrol.com/company/investors/RNS announcements.
3. Internal control
The directors acknowledge their responsibility for the Group’s system of internal control. Internal control systems are designed to meet the particular needs
of the Group and the risks to which it is exposed, and by their nature can provide only reasonable and not absolute assurance against material misstatement
of financial information or safeguarding of assets.
Guidance for directors, “Internal Control: Guidance for Directors on the Combined Code” was published in September 1999. The Group considers that it
complied with this guidance for the year ending 30 June 2005, and through to the date of the approval of the financial statements.
A review of the business risks faced by the Group and the effectiveness of its internal controls has been undertaken in the year and will be updated annually.
Business risks and internal controls are assessed by a number of methods, including regular departmental management interviews, in-depth Board reviews
of selected functional areas, and the periodic use of external consultants to independently assess areas of potential risk.
(i) Control environment
The Group’s control environment is the responsibility of the Board, however the implementation and day to day monitoring of internal controls is delegated
to the operational managers. Operational matters are communicated to the Board through operating unit or global function reports at each board meeting.
The effectiveness of financial internal controls is assessed annually and reported to the Board by the Chief Financial Officer. Any change to effectiveness of
the financial internal controls is reported at each board meeting. The Board also receives a quarterly review from the external auditors, in addition to the 
year end review, covering the scope of controls that they have sought to rely on in order to review, or form an opinion on, the financial statements.
(ii) Risk assessment
The Board has established a formal procedure to monitor the risk environment and reviews how controls are developed and adapted to minimise the Group’s exposure.
(iii) Financial reporting
The monthly results of the operating units are reported monthly to the Board and compared to the current budget. In addition, key performance indicators
(“KPIs”) relevant to the Group are monitored more frequently; on a daily and weekly basis by senior management, for example invoicing levels and sales mix,
cash flows and collections efficiency, and leads generated by marketing. Any trend in the KPIs away from budget is brought to the attention of the Board.
A comprehensive budget is produced once a year and is reviewed and approved by the Board. Rolling quarterly operating forecasts are completed and reported 
to the Board each month. Budgets are devolved to local and regional operational management who are responsible for managing their operating units within
budgetary constraints. Individual department managers are aware of and accountable for their authorisation limits with regard to expenditure and staff recruitment.
Corporate Governance
21. SurfControl plc Annual report 2005 www.surfcontrol.com (iv) Non-financial reporting
The executive directors meet twice monthly to discuss operational and strategic matters. Once per quarter these meetings cover strategic matters with a
time-frame extending beyond the current operating plans and budgets.
Senior management meet monthly via telephone or video link to review and discuss short-term tactical and operational matters. These meetings are global
in nature and bring all disciplines together at each meeting. Issues that affect multiple departments and communication are explicitly targeted as important
agenda items.
Management in sales, marketing, product management, engineering, technical support, human resources and legal meet at least monthly as teams to
monitor and assess progress against current operating plans, as well as opportunities to improve inter-operation.
(v) Treasury policy
The Board has a formal policy governing its treasury function, which is reviewed annually by the Board. The policy’s objective is to produce a competitive
yield on Group funds without exposing the Group to a significant level of risk, such that sufficient cash is preserved for working capital and investment
needs. The following risks are explicitly addressed: liquidity, counterparty, product, interest, and foreign exchange.
4. Provisions of the Code
Throughout the financial year ended 30 June 2005, and through to the date of approval of these financial statements, the Board consider that the Group has
complied with Section 1 of the Combined Code except to the extent described below:
Non-executive Director’s share options
The Company has in the past granted options over ordinary shares to George Hayter and currently he holds 800 outstanding options at a price of £8.49. The
Board believes that this interest in share options has not compromised his independence and George Hayter has subsequently been appointed the Senior
Independent Director.
Corporate Governance
22. SurfControl plc Annual report 2005 23. SurfControl plc Annual report 2005 www.surfcontrol.com
Introduction
This Report sets out the remuneration policy operated by the Company in respect of the Executive Directors, together with disclosures on Directors’
remuneration required by the Directors’ Remuneration Report Regulations 2002 (“the Regulations”). The auditors are required to report on the “auditable”
part of this Report and to state whether, in their opinion, that part of the Report has been properly prepared in accordance with the Companies Act 1985 
(as amended by the Regulations). The Report is therefore divided into separate sections for audited and unaudited information.
The Board have reviewed the Group’s compliance with section 1 of the 2003 Combined Code on Corporate Governance (“the Combined Code”) on
remuneration related matters and it is the opinion of the Board that the Group complied with all remuneration related aspects of section 1 of the Combined
Code during the year.
Unaudited information
1. Remuneration committee
The Remuneration Committee is responsible for developing policy on remuneration for executive directors and senior management below Board level 
and for determining specific remuneration packages for each of the executive directors.
The Remuneration Committee is chaired by Rene Schuster and its other members are George Hayter and Jane Tozer. The Remuneration Committee
members have no material personal financial interest other than as shareholders in matters to be decided, no potential conflicts of interests arising from
cross directorships and no day-to-day involvement in running the business.
During the year the Committee consulted Steve Purdham and Greg Lock about its proposals relating to the remuneration of other executive directors. The
Committee also consults with other senior members of staff on an occasional basis. Where executive directors have attended a Remuneration Committee
meeting there was no discussion relating to their own remuneration and benefits. No executive is involved in determining his or her own remuneration.
The Committee receives market data on competitive levels of compensation from New Bridge Street Consultants and Radford US. These firms, which were
not appointed by the Committee, provide general remuneration information to the Human Resources department from time to time but are not retained to
provide any other consulting services to the Committee or the Group generally.
The Committee has taken advice from Halliwell Consulting during the year in respect of the design, implementation and operation of the new Long Term
Incentive Plan (LTIP). The Company also took advice from Halliwell Consulting in respect to accounting for share-based payments under IFRS 2.
Halliwell Consulting was appointed by the Committee in respect to work on the LTIP .
2. Terms of reference
The Committee works within detailed terms of reference, which are set by the Board. Copies of the Committee’s terms of reference are available from the
Group’s website, www.surfcontrol.com/company/corporategoverance and are summarised below:
> The scale and structure of all aspects of remuneration for the executive directors and the Non-executive Chairman.
> The Group’s overall policy on senior management remuneration.
> The level and performance basis for share option or other share-based awards to executive directors, senior management and staff.
> The maintenance of service agreements with the Chairman and executive directors.
The fees for non-executive directors are a matter reserved for a Committee of the Board consisting of the Chairman and executive directors.
3. Remuneration policy overview
The Remuneration Committee’s overall policy aim is to provide a remuneration package which supports the achievement of the Company’s three year
roadmap to success. Specifically this involves providing a performance based remuneration package through the operation of annual and long-term
performance plans which are focused on motivating and encouraging executive directors and other senior management to achieve the relevant Group
growth and financial performance targets set out in the roadmap to success.
In addition, the Remuneration Committee is mindful of the following requirements for the Company’s remuneration policy; namely that the policy should:
> allow the Company to retain the talent needed to execute its business strategy;
> enable the Company to be competitive when recruiting appropriate skilled and experienced newcomers; and
> align rewards with the interests of shareholders.
Directors’ Remuneration Report 24. SurfControl plc Annual report 2005
When mapping out the levels of each element of the remuneration package for executives the Remuneration Committee looks at other comparable
companies in the global software technology sector. The following table sets out the broad policy position for each element of the Company’s remuneration
package compared to these companies:
Base Salary Bonus potential Share incentives Pension Total package
Median Upper Quartile Upper Quartile Lower Quartile Median – Upper Quartile
The policy is designed only to provide an upper quartile total package if bonus is earned and share incentives vest. It should be noted that the real value
received by the executives under the share incentive arrangements will be dependent upon the degree to which the associated performance conditions
have been satisfied at the end of the three year performance period and the share price of the Company at this time.
The Committee, when setting remuneration for the executives, also takes into account practice applicable to other employees within the Group.
The Remuneration Committee will continue to review the policy on an annual basis to ensure that it is in line with the Company’s objectives and 
shareholders’ interests.
Throughout the year under review the Committee has adopted the principle that the greater the potential award the more stretching the relevant
performance target.
No specific information for Pat Sueltz or Kevin Blakeman is included in the unaudited section of this report, as neither director was on the Board for the full
financial year.
The Company encourages executive directors to take one outside appointment to broaden their experience. Executive directors are allowed to keep the
fees earned from these outside appointments. Steve Purdham was paid $5,575 for his non-executive position on the board of Manchester Technology Fund
Limited. Patrick Jolly was paid $59,470 for his non-executive position on the board of Findel plc.
4. Remuneration
The Committee is of the view that a significant proportion of executive remuneration should be linked to corporate performance so that the interests of 
the executives are aligned as far as possible with those of shareholders. Performance related payments for the executive directors for the financial year
ended 30 June 2005 consisted of a combination of cash bonuses and LTIP awards. The following pie charts show the elements of the total expected
remuneration package set out in the table on page 28.
Directors’ Remuneration Report
Steve Purdham, Chief Executive
49% Performance compensation
51% Fixed compensation
Patrick Jolly, President EMEA
36% Performance compensation
64% Fixed compensation
Simon Wilson, Chief Financial Officer
42% Performance compensation
58% Fixed compensation
Key:
Fixed compensation is calculated as:
Salary
Benefits
Pension contribution
Performance compensation is calculated as:
Bonus paid
Intrinsic value of LTIP  There were no significant changes in the structure of executive remuneration since the end of the financial year, and it is the current intention of the
Committee to continue the same remuneration policy during the next and subsequent financial years.
Steve Purdham was Group Chief Executive up to 30 June 2005 when he took up the position of Chief Strategy Officer and Chief Technology Officer on the
appointment of Pat Sueltz to the Board. Pat Sueltz received no remuneration for the financial year, however the main elements of her package for the next
financial year are set out in the table below:
Salary Bonus Share Incentive Grant on Appointment Pension
$450,000 $200,000 A one off grant of 300,000 share options which will Up to 6% of earnings 
vest over three years in equal annual instalments. This (requires equal 
Paid after 12 months grant is not subject to additional performance conditions. executive contribution)
employment with no subject to true
performance conditions. An LTIP award over 105,272 shares subject to the normal applicable IRS cap which
provisions of the rules of the LTIP set out later in this report. is currently $14,000
(Will then revert to 
normal bonus arrangements The Committee believes that these levels of grant, and the lack 
with performance criteria.) of performance criteria associated with the options, is appropriate 
in order to attract a high calibre chief executive who is based in
the United States, where this is normal practice.
Basic salary
Policy: median
When determining the salary of the executive directors the Remuneration Committee takes into consideration:
> levels in pay and annual increases within other comparable companies in the global software sector;
> the performance of the individual executive director;
> the individual executive director’s experience and responsibilities; and
> pay and conditions throughout the Group.
The following table sets out the salary information for the executive directors in the currency of the country in which the executive resides:
Salary year ending Salary year ending Percentage rise 
Name 30 June 2004 30 June 2005 2004 to 2005
Steve Purdham £195,000 £195,000 0
Simon Wilson $285,000 $308,000 8
Patrick Jolly £200,000 £208,000 4
Bonus
Policy: upper quartile
Annual bonus arrangements are intended to incentivise the executive directors to achieve the Group’s pre-determined operational objectives for the year
under review, which are stepping stones to the achievement of the three year roadmap for success.
Executive bonuses are based on a mix of financial objectives relating to regional or Group revenue and Group EBITDA. The minimum threshold achievement
levels are that 75% of on-target bonuses become payable for achieving 90% of annual EBITDA targets and 95% of quarterly EBITDA targets. The use of
EBITDA as a performance measure closely aligns the executives with corporate strategy and the attainment of these targets is considered important in
attaining growth in shareholder value. The Remuneration Committee feels strongly that at this stage of the Company’s development the bonus performance
targets should also encourage growth in revenue, which will enhance the value of the Company in the medium- to long-term, and not act as a disincentive
to acquisitions which, although revenue enhancing, may in the short-term have an impact on earnings per share or return on capital employed.
25. SurfControl plc Annual report 2005 www.surfcontrol.com
Directors’ Remuneration Report 26. SurfControl plc Annual report 2005
The following table shows the level of bonus performance achieved as a percentage of salary in respect of performance measures for the year ending 
30 June 2005.
Steve Purdham Simon Wilson Patrick Jolly
Bonus earned Bonus earned Bonus earned 
Performance measure (percentage of salary) (percentage of salary) (percentage of salary) 
Group or regional revenue 52 24 28
Group EBITDA 14 7 7
Total as percentage of salary 66 31 35
Bonus targets and measures are reviewed and agreed by the Remuneration Committee at the beginning of each financial year to ensure that they are
appropriate to the current market conditions and position of the Company, so that they continue to remain challenging. The structure of the bonus targets
for the year ending 30 June 2006 will be similar to those operated for 2005. The maximum bonus potential for the year ending 30 June 2006 is 100% of the
relevant executive director’s salary. Bonuses are not pensionable.
Share incentives
Policy: upper quartile
Overview
During the previous year the Remuneration Committee reviewed its share incentive policy and concluded that the interests of shareholders and executives
would be better aligned through awarding whole shares under an LTIP (which was approved by shareholders at the 2004 Annual General Meeting) rather
than using options. Share options will only be granted to executive directors on recruitment, although options may be granted to other senior management.
This difference in policy between the executive directors and other senior management is mainly due to greater familiarity with options in the United States,
although this policy will be kept under review as local practice changes over time.
The Company’s share incentive schemes are operated without any significant cost.
Shareholding requirements
In order to further align the interests of shareholders with those of the executives, the Remuneration Committee has introduced minimum shareholding
guidelines to encourage substantial long-term share ownership by the executive directors. By encouraging the executive directors to build up shareholdings
it will demonstrate their ongoing commitment to, and confidence in, the Company. The guidelines will require that over a five year period executive
directors build up and retain a holding of shares based on a percentage of salary as per the table below:
Position Recommended shareholding requirement as 
percentage of salary (built up over five years)
CEO 200% 
All other executive directors 100%
The Remuneration Committee expects this requirement to be built up through the retention of some shares acquired by the executive directors under the
Company’s share schemes or through individual market purchases. If the executive directors do not build up such percentages, the Remuneration
Committee may take this into account when considering the level of future incentive awards.
Dilution
In common with a number of companies in the technology sector the Company sought an overall dilution limit greater than the standard ABI limits of 10%
of issued share capital for its share schemes. A limit of 20% was approved by the Company’s shareholders at an Extraordinary General Meeting on 14 July
2000. The Remuneration Committee recognises that practice has changed over the last three years and that this level of dilution is no longer seen as in line
with corporate governance best practice. It is clearly impractical to reduce the Company’s current level of dilution immediately.Therefore the Company
intends to address the situation by granting fewer options over newly issued shares and using market purchased shares to satisfy awards under the LTIP .
These changes, coupled with historical share incentives falling out of the dilution calculation, will move the Company closer to the 10% limit over time.
Directors’ Remuneration Report 27. SurfControl plc Annual report 2005 www.surfcontrol.com
Directors’ Remuneration Report
Option scheme
The following table summarises the main terms of the option scheme:
Term Detail Term Detail
Participants The current executive directors participating in the LTIP Maximum The rules of the Option Scheme were approved without 
will not be granted further options. Options will be annual grant an annual limit. However, the Remuneration Committee 
granted to other members of senior management. has determined in normal operation of the Scheme that 
In addition options may still be used on recruitment. the maximum annual grant to any employee during a 
financial year will be 100% of salary.
Performance A mix of Group revenue and EBITDA targets for the Performance Two sets of performance criteria linked to Group target
condition relevant year of account. These measures were used condition EBITDA performance for that year and Company Total 
1999–2003 because the Committee believed they were the most 2004 Shareholder Return (“TSR”) relative to that of the FTSE
relevant measures to encourage growth at this stage techMARK Index over a two year period July 2003 to July
of the Company’s development. 2005. TSR was included by the Remuneration Committee 
to encourage executives to take into account the Company’s
comparative returns to shareholders.
Status of Options have either vested or lapsed. Status of All options, which were first exercise able in July 2005,
options options have lapsed.
1999–2003 2004
Long Term Incentive Plan
The main terms of the LTIP approved by shareholders at the Annual General Meeting in October 2004 are set out below, which have not been varied since
the scheme was adopted. The LTIP will be the ongoing long-term equity arrangement for the executive directors:
Term Detail Term Detail
Participants Currently the executive directors. Maximum Initial awards on launch of the Plan were a maximum of 200%
annual grant of salary. Ongoing awards a maximum of 100% of salary.
Primary Comparative TSR performance. Release of awards Secondary The Remuneration Committee will ensure that the release of 
performance starting at the median (25% of awards) with full release performance the award is consistent with the underlying financial 
condition at the upper quartile. condition performance of the Company.
Indicators considered will include:
The Remuneration Committee believes that comparative > Operating and Free Cash Flow generated over the three
TSR is the most appropriate measure to align shareholders’ year period.
and executives’ interests as it ensures that, before being > Levels of Deferred Revenue recognised over the three
entitled to receive any of their L TIP Awards, the executives year period.
outperform their peers over the measurement period > The value of new versus renewals billings over the
in delivering shareholder value irrespective of general three year period.
market conditions.
Comparator Alphameric Plc Dimension Data Holdings Plc Internet Security Systems Inc Safenet Inc
group Anite Group Plc Emblaze Limited Marlborough Stirling Plc* Secure Computing Inc
Autonomy Corporation Plc F-Secure Oyj Northgate Information SonicWall Inc
Solutions Plc
Aveva Group Plc Gresham Computing Plc NSB Retail Systems Plc Watchguard Technology Inc
Dicom Group Plc Intec Telecom Systems Plc RoyalBlue Group Plc Websense Inc
* Marlborough Stirling Plc was acquired by United Utilities Plc in May 2005.
LTIP performance will be assessed by the Committee on an independent basis, with the assistance of their remuneration advisers. 28. SurfControl plc Annual report 2005
Directors’ Remuneration Report
Benefits
Policy: market practice
The Company provides market practice benefits for executives of this level of seniority. Benefits in kind include a Company car (or allowance) for UK based
directors, access to Group employee medical schemes and life assurance cover for all directors.
Pension
Policy: lower quartile
The Group operates defined contribution schemes for its executive directors, consistent with its policy for its employees. The parent company contributes
up to 10% of basic salary into the UK based money purchase scheme in respect of Patrick Jolly and amounts as agreed by the Committee into a separate
executive money purchase pension scheme for Steve Purdham.
During the year SurfControl Inc. provided 401k employer contributions for US based executives at the lower of 3% of annual salary or 50% of the personal
contributions paid by the executive. For FY06, the contribution has been increased to the lower of 6% of annual salary or 100% of personal contributions.
Personal contributions for all US employees are subject to a cap set annually by the IRS which is currently $14,000.
These schemes are administered independently of the Company or any group company. Details of contributions made by the Group on behalf of directors
are given on page 31.
The Company does not anticipate the change in pension legislation in the UK on 6 April 2006 will affect its current pension provision. The Company would
not, in any case, provide executives with compensation for loss of tax relief on pension contributions.
No director received any payment from Group pension arrangements in the year.
Total package value
Policy: median to upper quartile
The Company’s remuneration policy is designed so that the total package value will only be upper quartile if stretching performance is achieved and
bonuses are paid out and share incentives vest. The following table shows the total package value provided to the executive directors of the Company:
Bonus paid
during year Total
ended 30 Benefits Pension LTIP Award package 
Name Salary June 2005 in kind contribution value* value
Steve Purdham $362,000 $238,000 $25,000 $67,000 $195,138 $887,138
Simon Wilson $308,000 $95,000 $14,000 $7,000 $139,385 $563,385
Patrick Jolly $387,000 $137,000 $46,000 $27,000 $117,082 $714,082
* The LTIP award is an estimate of the potential intrinsic value of the award made in the year. This cost has been spread over a three-year vesting period in the profit and loss account as
required by UITF 17 abstract, Employee Share Schemes. It should be noted that the value of LTIP awards is based on the profit and loss account charge, which includes an assessment of 
the likelihood of the performance conditions being satisfied. The actual benefit provided by the LTIP awards will only be determined three years after the date of grant, and will be based on
the Company’s comparative TSR performance at that point. 29. SurfControl plc Annual report 2005 www.surfcontrol.com
5. Other remuneration matters
Directors’ contracts
The policy on termination is that the Company does not make payments beyond its contractual obligations. The only event where the Company may be
liable to make a payment to any of the executive directors is on cessation of employment. No payment is due on either a Company takeover or liquidation.
In addition, executive directors will be expected to mitigate their loss. Further, the Remuneration Committee ensures that there have been no unjustified
payments for failure. None of the executive directors’ contracts provides for liquidated damages. There are no special provisions contained in any of the
executive directors’ contracts which provide for longer periods of notice on a change of control of the Company. Further, there are no special provisions
providing for additional compensation on an executive director’s cessation of employment with the Company.
Director Date of contract Contract term Minimum notice period Provision for compensation over notice period
Pat Sueltz 30 June 2005 Rolling 12 months Six months by the Basic salary, employer pension
(after initial six months) Company in the first 12 contributions, together with such 
months of employment bonuses (payable pursuant to the 
or 12 months thereafter, current bonus arrangements), and the
and three months by cash equivalent value of all benefits 
the director. in kind or allowances for the relevant 
notice period.
Steve Purdham 1 March 1998 Rolling 12 months 12 months
Simon Wilson 7 February 2000 Rolling 12 months 12 months by the 
Company or three months 
by the director.
Patrick Jolly 28 August 2000 Rolling 12 months 12 months by the 
Company or six months 
by the director.
Kevin Blakeman* 17 November 2000 Rolling 12 months 12 months by the
(as varied 13 Company or three months
December 2001) by the director.
Greg Lock 17 October 2000 Equivalent to Three months Fees and all non-reimbursed expenses.
George Hayter 15 June 1998 the minimum 
notice period
Jane Tozer 1 November 2003 Equivalent to
Rene Schuster 1 November 2003 the minimum 
notice period
* Resigned 26 October 2004.
Non-executive directors
The Company pays the current non-executive directors, with the exception of Greg Lock, a fixed basic fee of £25,000 ($47,000). Rene Schuster and Jane Tozer
also receive an additional £5,000 ($9,000) per annum for their services as Chairmen of the Remuneration and Audit Committee respectively. George Hayter
receives an additional £5,000 per annum for his position as Senior Independent Director.
During the year Jane Tozer received additional fees of £5,000 in respect to her work on the LTIP and in recognition of her additional services to the
Remuneration Committee. Rene Schuster agreed to forego £5,000 in fees.
Greg Lock receives a fixed basic fee of £75,000 per annum with effect from 1 January 2005, and earned fees of £67,500 ($125,000) in the financial year.
Non-executive fees are reviewed annually by a Committee of the Board consisting of the Chairman and executive directors and are set at levels, which are
considered appropriate to attract and maintain individuals with requisite experience. The Chairman’s fees are also reviewed annually by the Remuneration
Committee without reference to the Chairman.
Directors’ Remuneration Report 30. SurfControl plc Annual report 2005
6. Performance graph
The graph below sets out the cumulative TSR of the Company and those companies comprising the FTSE techMARK All Share Index and the FTSE Software
& Computer Services Index for the period of five years from July 2000 to June 2005. In the opinion of the Directors these are the principal equity indices used
by the investment community as a benchmark for performance comparison with the Company. In addition, for information the Remuneration Committee
has included the Company’s performance against the comparator group used for the LTIP .
7. Interest in shares
The directors, who held office at the end of the financial year, and their immediate families, had the following interests in the shares of the Company:
Ordinary Ordinary
10p shares 10p shares
30 June 30 June
2005 2004
Steve Purdham 95,000 95,000
Pat Sueltz – –
Simon Wilson – beneficial 2,320 1,330
Simon Wilson – non beneficial 1,000 1,000
Patrick Jolly 6,989 3,489
Greg Lock 17,500 17,500
George Hayter 9,450 9,450
Jane Tozer 1,936 –
Rene Schuster 10,000 10,000
There were no changes in directors’ interests between 30 June 2005 and the date of this report.
Directors’ Remuneration Report
–100
–80
–60
–40
–20
0
20
40
60
80
2000 2001
Year
Percentage
2002 2003 2004 2005
FTSE Software and Computer Services
Comparator group
SurfControl
FTSE All Share TechMark Audited information
1. Details of directors’ emoluments
Total salary, fees, cash bonus and benefits paid to the directors in the financial year were as follows:
Benefits
Salary/fees Bonus in kind Total Total Total
2005 2005 2005 2005 2004 2003
Name $’000 $’000 $’000 $’000 $’000 $’000
Steve Purdham* 362 238 25 625 527 454
Pat Sueltz (appointed 30 June 2005) –––– ––
Simon Wilson 308 95 14 417 444 469
Patrick Jolly 387 137 46 570 519 459
Kevin Blakeman (resigned 26 October 2004) 77 33 4 114 368 373
Greg Lock 125 – – 125 89 40
George Hayter 56–– 56 49 40
Jane Tozer 65–– 65 35 –
Rene Schuster 47–– 47 35 –
Rob Barrow (resigned 1 November 2003) –––– 47 158
Simon Acland (resigned 1 November 2003) –––– 14 40
1,427 503 89 2,019 2,127 2,033
* Highest paid director
Included in benefits for Steve Purdham is $22,000 for a car allowance (2004: $21,000) which was chargeable to UK income tax. No other director received 
an expense allowance in the year.
The amounts shown in the above table of directors’ emoluments for Simon Acland represent payments to Quester Services Limited who employed him 
as a director.
2. Pensions
Details of pension contributions made by the Group on behalf of directors are given below:
2005 2004 2003
Executive $’000 $’000 $’000
Steve Purdham 67 63 54
Pat Sueltz – ––
Simon Wilson 7 46
Patrick Jolly 27 17 16
Kevin Blakeman 1 77
102 91 83
Directors’ Remuneration Report
31. SurfControl plc Annual report 2005 3. Share options
The following table shows the movement in the number of share options held by directors during the year under review.
Exercise Exercise 1 July Granted in Lapsed in Exercised 30 June
Name price period 2004 the year the year in the year 2005
Steve Purdham 331p 15/7/00–15/7/09 150,000––– 150,000
434p 30/11/00–29/11/09 150,000––– 150,000
849p 14/6/01–13/6/10 160,000––– 160,000
365p 30/6/02–29/6/11 150,000––– 150,000
421p 3/7/03–2/7/12 160,000––– 160,000
647.50p 2/7/05–1/7/13 100,000 – (100,000) – –
Steve Purdham – non beneficial 321p 5/10/00–4/10/09 3,000––– 3,000
849p 14/6/01–13/6/10 3,200––– 3,200
Pat Sueltz 475p 30/6/06–29/6/15 – 300,000 – – 300,000
Simon Wilson 849p 21/2/01–20/2/10 180,000––– 180,000
365p 30/6/02–29/6/11 12,500––– 12,500
421p 3/7/03–2/7/12 50,000––– 50,000
647.50p 2/7/05–1/7/13 60,000 – (60,000) – –
Patrick Jolly 849p 10/9/01–9/9/10 260,000––– 260,000
365p 30/6/02–29/6/11 12,500––– 12,500
421p 3/7/03–2/7/12 40,000––– 40,000
647.50p 2/7/05–1/7/13 60,000 – (60,000) – –
Kevin Blakeman 321p 5/10/00–4/10/09 6,000––– 6,000
849p 9/2/01–8/2/10 8,000––– 8,000
849p 14/6/01–13/6/10 12,000––– 12,000
738p 29/11/01–28/11/10 85,000––– 85,000
365p 30/6/02–29/6/11 12,500––– 12,500
421p 3/7/03–2/7/12 40,000––– 40,000
647.5p 2/7/05–1/7/13 60,000 – (60,000) – –
George Hayter 849p 9/2/01–8/2/10 800––– 800
The closing middle market price of the Company’s shares at the end of the financial year was £4.59 and ranged between £4.59 and £6.75 during the year.
The performance conditions applying to these options are described in the Share incentives section above.
Directors’ Remuneration Report
32. SurfControl plc Annual report 2005 4. L TIP
The maximum number of nil-cost shares that have currently been allocated to executive directors under the LTIP are as follows:
First vesting dates
1 July Granted in Released in Lapsed in 30 June 21 October 30 June 
Name 2004 the year the year the year 2005 2007 2008
Steve Purdham – 72,227 – – 72,227 72,227 –
Pat Sueltz – 105,727 – – 105,727 – 105,727
Simon Wilson – 51,591 – – 51,591 51,591 –
Patrick Jolly – 43,336 – – 43,336 43,336 –
LTIP awards were granted to Steve Purdham, Simon Wilson and Patrick Jolly on 21 October 2004. The closing middle market price on the day immediately
preceding the grant was £5.815. LTIP shares were granted to Pat Sueltz on 30 June 2005. The closing middle market price on the day immediately preceding
the grant was £4.75.
The performance period is three years from the grant date in respect of all LTIP allocations and the performance conditions applying to these awards are
described in the Share incentives section above.
Rene Schuster
Chairman of the Remuneration Committee
5 September 2005
33. SurfControl plc Annual report 2005 www.surfcontrol.com
Directors’ Remuneration Report 34. SurfControl plc Annual report 2005
We have audited the financial statements on pages 35 to 62. We have also audited the information in the Directors’ Remuneration Report that is described
as having been audited.
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 auditor’s 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
The directors are responsible for preparing the Annual Report and the Directors’ Remuneration Report. As described on page 16, this includes responsibility 
for preparing the financial statements in accordance with applicable United Kingdom law and accounting standards. Our responsibilities, as independent
auditors, are established in the United Kingdom by statute, the Auditing Practices Board, the Listing Rules of the Financial Services Authority, and by our
profession’s ethical guidance.
We report to you our opinion as to whether the financial statements give a true and fair view and whether the financial statements and the part of the
Directors’ Remuneration Report to be audited have been properly prepared in accordance with the Companies Act 1985. We also report to you 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 Group is not disclosed.
We review whether the Corporate Governance Statement on pages 18 to 22 reflects the Company’s compliance with the nine provisions of the 2003 FRC
Code specified for our review by the Listing Rules, and we report if it does not. We are not required to consider whether the Board’s statements on internal
control cover all risks and controls, or form an opinion on the effectiveness of the Group’s corporate governance procedures or its risk and control
procedures.
We read the other information contained in the Annual Report, including the Corporate Governance Statement and the unaudited part of the Directors’
Remuneration Report, and consider whether it is consistent with the audited financial statements. We 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 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 and the part of the Directors’ Remuneration Report to be audited. 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 Group’s circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with
sufficient evidence to give reasonable assurance that the financial statements and the part of the Directors’ Remuneration Report to be audited are free 
from material misstatement, whether caused by fraud or other irregularity or error. In forming our opinion we also evaluated the overall adequacy of the
presentation of information in the financial statements and the part of the Directors’ Remuneration Report to be audited.
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 June 2005 and of the profit of the 
group for the year then ended.
> The financial statements and the part of the Directors’ Remuneration Report to be audited have been properly prepared in accordance with the 
Companies Act 1985.
KPMG Audit Plc
Chartered Accountants
Registered Auditor
St James Square
Manchester M2 6DS
5 September 2005
Independent Auditors’ Report to the Members of SurfControl Plc 35. SurfControl plc Annual report 2005 www.surfcontrol.com
2005 2004 2003
Notes $’000 $’000 $’000
Turnover 2 97,838 87,335 73,232
Cost of sales (1,746) (1,393) (723)
Gross profit 96,092 85,942 72,509
Selling and distribution (47,353) (44,025) (39,740)
Research and development (12,964) (9,678) (7,530)
General and administrative (19,049) (16,813) (14,580)
Amortisation of intangible assets and depreciation 6,9,10 (10,119) (3,148) (2,779)
Equity based compensation 15,17 181 (49) (487)
Exceptional item – onerous lease 3 (1,648) ––
Total administrative expenses (43,599) (29,688) (25,376)
Operating profit 5,140 12,229 7,393
Proceeds from disposal of business – 311 381
Profit on ordinary activities before interest and taxation 5,140 12,540 7,774
Net interest receivable and similar items 7 2,481 1,859 1,105
Profit on ordinary activities before taxation 7,621 14,399 8,879
Tax on profit on ordinary activities 8 (1,176) (2,862) (2,516)
Profit on ordinary activities after taxation and retained profit for the period 17,18 6,445 11,537 6,363
Basic earnings per ordinary share (cents) 4 21.3 37.3 20.9
Diluted earnings per share (cents) 4 20.9 36.0 20.8
There is no material difference between the reported results and the results calculated on an historical cost basis.
All results are from continuing activities except for proceeds from disposal of business.
An unaudited reconciliation between the Group profit on ordinary activities after taxation and EBITDA is shown on page 63.
2005 2004 2003
Notes $’000 $’000 $’000
Profit for the year 6,445 11,537 6,363
Unrealised exchange difference on translation 17,18 (118) 3,355 1,095
Total recognised gains and losses relating to the financial year 6,327 14,892 7,458
The notes on pages 40 to 62 form part of these financial statements.
Group Profit and Loss Account
for the year ended 30 June
Group Statement of Total Recognised Gains and Losses
for the year ended 30 June 36. SurfControl plc Annual report 2005
2005 2004 2003
Notes $’000 $’000 $’000
Fixed assets
Intangible assets 9 9,768 12,554 –
Tangible assets 10 3,863 4,065 3,268
13,631 16,619 3,268
Investments 11 31 31 29
13,662 16,650 3,297
Current assets
Stocks – 69 –
Debtors 12 32,570 31,681 24,138
Cash at bank and in hand 23 89,044 87,477 61,707
121,614 119,227 85,845
Creditors: amounts falling due within one year 13 (74,983) (72,226) (52,241)
Net current assets 46,631 47,001 33,604
Total assets less current liabilities 60,293 63,651 36,901
Creditors: amount falling due after more than one year 14 (27,835) (26,001) (16,742)
Provisions for liabilities and charges 15 (161) (446) (540)
32,297 37,204 19,619
Capital and reserves
Called up share capital 16,17 5,032 5,027 4,946
Share premium account 17 3,987 3,803 79
Capital redemption reserve 17 882 882 882
Profit and loss account 17 22,396 27,492 13,712
Shareholders’ funds 18 32,297 37,204 19,619
Shareholders’ funds comprise:
Equity shareholders’ funds 32,297 37,204 19,619
Approved by the Board of directors on 5 September 2005 and signed on its behalf by:
Steve Purdham, Director Simon Wilson, Director
The notes on pages 40 to 62 form part of these financial statements.
Group Balance Sheet
as at 30 June 2005 37. SurfControl plc Annual report 2005 www.surfcontrol.com
2005 2004 2003
Notes $’000 $’000 $’000
Fixed assets
Intangible assets 9 9,768 11,911 –
Tangible assets 10 1,438 1,426 1,308
11,206 13,337 1,308
Investments 11 178,489 199,754 187,208
189,695 213,091 188,516
Current assets
Debtors 12 8,950 15,993 5,714
Cash at bank and in hand 58,358 55,630 36,503
67,308 71,623 42,217
Creditors: amounts falling due within one year 13 (42,021) (38,462) (14,222)
Net current assets 25,287 33,161 27,995
Total assets less current liabilities 214,982 246,252 216,511
Creditors: amount falling due after more than one year 14 (12,949) (12,577) (3,880)
Provisions for liabilities and charges 15 (161) (446) (540)
201,872 233,229 212,091
Capital and reserves
Called up share capital 16,17 5,032 5,027 4,946
Share premium account 17 3,987 3,803 79
Merger reserve 17 130,407 130,407 130,407
Capital redemption reserve 17 882 882 882
Profit and loss account 17 61,564 93,110 75,777
Shareholders’ funds 201,872 233,229 212,091
Shareholders’ funds comprise:
Equity shareholders’ funds 201,872 233,229 212,091
Approved by the Board of directors on 5 September 2005 and signed on its behalf by:
Steve Purdham, Director Simon Wilson, Director
The notes on pages 40 to 62 form part of these financial statements.
Company Balance Sheet
as at 30 June 2005 38. SurfControl plc Annual report 2005
2005 2004 2003
Notes $’000 $’000 $’000
Net cash inflow from operating activities 21 23,120 32,637 24,093
Returns on investments and servicing of finance 22 2,627 1,792 741
Taxation (1,679) (5,536) (1,048)
Capital expenditure and financial investment
Purchase of tangible fixed assets (2,194) (2,267) (1,633)
Purchase of investments – – (19)
Sale of tangible fixed assets – 17 28
Net cash outflow from capital expenditure and financial investment (2,194) (2,250) (1,624)
Acquisitions and disposals
Business acquisitions (8,725) (8,910) –
Cash acquired with subsidiary undertaking – 120 –
Proceeds from disposal of business – 311 381
Net cash (outflow)/inflow from acquisitions and disposals (8,725) (8,479) 381
Net cash inflow before management of liquid resources and financing 13,149 18,164 22,543
Management of liquid resources 23 2,550 (7,470) (15,620)
Financing
Proceeds from share issue 245 3,750 1,271
Purchase of own shares for treasury (11,798) (839) –
Net repayment of capital element of finance leases 23 (19) (38) (45)
Net cash (outflow)/inflow from financing (11,572) 2,873 1,226
Increase in cash in the period 23 4,127 13,567 8,149
The notes on pages 40 to 62 form part of these financial statements.
Group Statement of Cash Flows
for the year ended 30 June 39. SurfControl plc Annual report 2005 www.surfcontrol.com
2005 2004 2003
Notes $’000 $’000 $’000
Increase in cash in the period 4,127 13,567 8,149
Cash outflow from decrease in debt and lease financing 23 19 38 45
Net transfers from liquid resources 23 (2,550) 7,470 15,620
Change in net funds resulting from cash flows 23 1,596 21,075 23,814
Difference on translation 23 (10) 4,727 2,477
Movement in net funds in the period 1,586 25,802 26,291
Net funds at 1 July 2004/1 July 2003/1 July 2002 23 87,436 61,634 35,343
Net funds at 30 June 2005/30 June 2004/30 June 2003 23 89,022 87,436 61,634
The notes on pages 40 to 62 form part of these financial statements.
Reconciliation of Net Cash Flow to Movements in Net Funds
for the year ended 30 June 40. SurfControl plc Annual report 2005
1. Accounting policies
The following principal accounting policies have been applied consistently in dealing with items considered material in relation to the Group’s 
financial statements.
Accounting convention
The financial statements are prepared under the historical cost convention and in accordance with applicable United Kingdom accounting standards.
The functional currency of the Group is US dollars as the majority of the Group’s business is conducted in the United States and accordingly amounts in the
financial statements are denominated in that currency.
Basis of consolidation
The Group financial statements consolidate the financial statements of SurfControl plc and its subsidiary undertakings made up to 30 June 2005. Unless
otherwise stated, the acquisition method of accounting has been adopted. Under this method, the results of subsidiary undertakings acquired in the year
are included in the Consolidated Profit and Loss Account from the date of acquisition.
Under section 230 (4) of the Companies Act 1985 the Company is exempt from the requirements to present its own profit and loss account.
Turnover and deferred income
Turnover represents the value of goods and services (net of VAT and other regional sales tax) delivered in the normal course of business. Turnover from
software and appliance perpetual licence sales is recognised once the licence is delivered, all significant obligations in relation to the sale have been fulfilled,
and where the sales price is fixed and determinable. Sales made via channel partners are neither invoiced, nor recognised as turnover, until the product or
service is delivered to the end customer. Turnover from the following items are recognised over the relevant period of the contract on a straight-line basis:
software/appliance support and maintenance, threat database subscriptions, Cyber Patrol home product subscriptions, and OEM contract licences. Turnover
from services is recognised upon completion. Where the proportion of the total sale price attributable to different elements of the sale is not specifically
identified, an estimate is made based upon the published list prices for each of the individual elements.
Deferred income represents the value of goods and services (net of VAT and other regional sales tax) that has been invoiced but not considered delivered 
or completed, plus the unrecognised portion of turnover from software/appliance support and maintenance, threat database subscriptions, Cyber Patrol
home product subscriptions, and OEM contract licences. Deferred income is carried forward within creditors, and released to turnover in the Profit and Loss
Account in future periods on a straight-line basis.
Research and development
All research and development expenditure is written off as incurred.
Technical support
All pre- and post-sales support expenditure is written off as incurred.
Taxation
The charge for taxation is based on the profit for the year, and takes into account taxation deferred because of timing differences between the treatment 
of certain items for taxation and accounting purposes. Deferred tax is recognised, without discounting, in respect of all timing differences between the
treatment of certain items for taxation and accounting purposes which have arisen but not reversed by the balance sheet date, except as otherwise
required by FRS 19.
Pensions
The Group operates a number of defined contribution pension schemes, the assets of which are held separately from those of the Group in independently
administered funds. Contributions are charged to the Profit and Loss Account as incurred.
Equity compensation
The employment tax charge arising on the future potential exercise of Inland Revenue unapproved options and LTIP shares is charged to the Profit and 
Loss Account over the period from the date of grant to the date the equity based benefits unconditionally vest. The charge is based upon the difference
between the grant price and the closing middle market price at the balance sheet date. Provision is also made for the intrinsic value of LTIP shares,
which is charged to the Profit and Loss Account over the vesting period (which is the same as the performance period) and credited to reserves.
Notes to the Financial Statements
for the year ended 30 June 2005 41. SurfControl plc Annual report 2005 www.surfcontrol.com
1. Accounting policies continued
Intangible assets and goodwill
Intangible assets include the fair value of acquired intellectual property and goodwill. Acquired goodwill (representing the excess of the fair value of the
consideration and associated costs over the fair value of the separable net assets acquired) arising on consolidation is capitalised. Acquired intellectual
property is also capitalised, where in the opinion of the directors it satisfies the recognition criteria given in FRS 10, Goodwill and Intangible Assets. Acquired
intellectual property and positive goodwill is amortised to nil by equal annual instalments over its estimated useful economic life, unless impaired, in which
case it is written down to its recoverable amount. For acquisitions to date, the estimated useful economic life of these assets has been two years.
On the subsequent disposal or termination of the business, the profit or loss on disposal or termination is calculated after charging the unamortised amount
of any related goodwill.
Tangible fixed assets and depreciation
Tangible fixed assets are recorded at cost. The carrying value of such assets is written down by the amount of any impairment, and the loss is recognised 
in the Profit and Loss Account in the period in which this occurs.
Included within tangible fixed assets are the project costs associated with the construction of various software and hardware systems for use within 
the Group’s internal systems. Cost includes basic salary, related employer tax costs, and travel expenses for computer engineers, for the duration of the
development stage of the application. Also included in the asset cost is any related external consultancy or engineering fees. All costs relating to initial
planning or aborted projects are written off to Profit and Loss Account as incurred.
Assets in the course of construction are not depreciated until they are completed, at which time the final asset cost is transferred to Computer equipment
and software or Fixtures and fittings.
Depreciation is provided at rates calculated to write off the cost less the estimated residual value of tangible fixed assets over their estimated useful
economic lives as follows:
Computer equipment and software – over 3 years
Motor vehicles – over 4 years
Fixtures and fittings – over 5 years
Investments
Fixed asset investments, which principally relate to the Company’s investment in subsidiary undertakings, are stated at cost less any provisions for
impairment in value.
Cash and liquid resources
Cash, for the purpose of the cash flow statement, comprises cash in hand, deposits repayable on demand and investments in instant access money market
managed funds. Liquid resources are current asset investments which are disposable without curtailing or disrupting the business and are either readily
convertible into known amounts of cash at or close to their carrying values or traded in an active market. Liquid resources comprise term deposits of one
year or less and certificates of deposit.
Notes to the Financial Statements
for the year ended 30 June 2005 42. SurfControl plc Annual report 2005
1. Accounting policies continued
Leasing and hire purchase commitments
Assets held under finance leases and hire purchase contracts are capitalised in the balance sheet and are depreciated over their useful lives. The corresponding
liability for the capital element is recorded as borrowings, and the interest element of the rental obligations is charged to the Profit and Loss Account over
the period of the lease on a straight-line basis.
Rentals paid under operating leases are charged to the Profit and Loss Account on a straight-line basis over the lease term.
Provision is made for onerous leases relating to vacant properties.
Foreign currencies
Monetary assets and liabilities of each entity denominated in currencies other than the functional currency of the Group are translated at the rates of
exchange ruling at the balance sheet date. Transactions in such currencies are recorded at the average rate ruling during the period of the transaction.
Exchange differences arising from the translation of the opening net assets of entities which principally operate in currencies other than US dollars to the
exchange rate ruling at the balance sheet date, and the difference between the profit and loss accounts of such entities translated at an average rate and at
the closing rate, are recorded as movements on reserves.
All other differences are taken to the Profit and Loss Account.
Relevant rates of exchange were:
Balance sheet rate of exchange (US dollar to local currency) 2005 2004 2003
UK sterling 1.79 1.81 1.65
Euro 1.21 1.22 1.15
Australian dollar 0.76 0.70 0.67
Chinese yuan 0.12 0.12 n/a
Japanese yen 0.009 n/a n/a
Israeli shekel 0.22 n/a n/a
Profit and loss average rate of exchange (US dollar to local currency) 2005 2004 2003
UK sterling 1.86 1.74 1.58
Euro 1.27 1.19 1.05
Australian dollar 0.75 0.71 0.59
Chinese yuan 0.12 0.12 n/a
Japanese yen 0.009 n/a n/a
Israeli shekel 0.23 n/a n/a
Notes to the Financial Statements
for the year ended 30 June 2005 43. SurfControl plc Annual report 2005
2. Segmental analysis
Analysis by geographical area
A geographical analysis of the Group’s turnover, profit/ (loss) before interest and tax, and net assets/(liabilities) is as follows:
2005 2004 2003
Turnover by destination $’000 $’000 $’000
United Kingdom 19,305 15,778 11,792 
Mainland Europe 8,920 7,357 4,493 
North America 59,845 57,395 52,381 
Rest of the world 9,768 6,805 4,566 
97,838 87,335 73,232 
2005 2004 2003
Turnover by origin $’000 $’000 $’000
United Kingdom 22,895 19,108 14,572 
Mainland Europe 7,229 5,553 3,384 
North America 59,777 57,216 52,553 
Rest of the world 7,937 5,458 2,723 
97,838 87,335 73,232 
2005 2004 2003
Profit /(loss) before interest and tax $’000 $’000 $’000
United Kingdom (1,505) 5,679 6,111
Mainland Europe 814 (87) 28
North America 5,573 9,332 51
Rest of the world 258 (2,384) 1,584
5,140 12,540 7,774
2005 2004 2003
Net assets/(liabilities) $’000 $’000 $’000
United Kingdom (12,952) (27,485) (10,396)
Mainland Europe (4,223) (4,508) (2,517)
North America (34,014) (14,767) (27,304)
Rest of the world (5,536) (3,472) (1,798)
(56,725) (50,232) (42,015)
Head office and central administration 89,022 87,436 61,634 
32,297 37,204 19,619 
Profit/(loss) before interest and tax and net assets/(liabilities) incorporate the effect of the Group’s transfer pricing arrangements. These adjustments primarily
consist of intra-group recharges arising from the location of intellectual property.
Head office and central administration net assets comprise cash balances of $89,044,000 and finance lease obligations of $22,000 at 30 June 2005.
(2004: Cash balances $87,477,000, Finance lease obligations $41,000) (2003: Cash balances $61,707,000, Finance lease obligations $73,000).
Notes to the Financial Statements
for the year ended 30 June 2005 44. SurfControl plc Annual report 2005 www.surfcontrol.com
2. Segmental analysis continued
Analysis by product group
During the current and preceding financial years the Group had one product group and one class of business, the development and sale of Internet 
security products.
Analysis by continuing operations
The Company acquired technology and certain assets from Apreo Limited on 28 February 2005. It is not possible to separately identify the post acquisition
profit before tax and interest relating to the acquired technology assets because they were immediately integrated with other like Group operations.
Intangible asset amortisation of $1,173,000 has been charged to the UK segmental results shown above in respect of this acquisition.
3. Exceptional item – onerous lease charge
2005 2004 2003
$’000 $’000 $’000
Rent on vacant offices 1,648 ––
During the year SurfControl, Inc, the Company’s principal subsidiary, vacated its offices for alternative accommodation in Scott’s Valley, California. Vacant
possession of the premises has been retained until September 2006, or until such time as the remaining unexpired lease is assigned. An amount equivalent
to the rent accruing over the remaining lease term, together with related costs, was written off to the Profit and Loss Account in the year.
4. Earnings per share
Basic and diluted earnings per ordinary share are calculated as follows:
2005 2004 2003
$’000 $’000 $’000
Profit on ordinary activities after taxation (for basic and diluted earnings per share) 6,445 11,537 6,363
Basic weighted average ordinary shares in issue 30,326,066 30,974,588 30,426,265
Dilutive effect of share options and long-term incentive share rights 448,147 1,036,691 192,885
Diluted weighted average ordinary shares in issue 30,774,213 32,011,279 30,619,150
Basic earnings per ordinary share (cents) 21.3 37.3 20.9
Diluted earnings per ordinary share (cents) 20.9 36.0 20.8
Own shares held by the Company of 1,195,000 (2004: 106,000) (2003: nil) have been treated as cancelled for the purpose of the earnings per share calculation.
Notes to the Financial Statements
for the year ended 30 June 2005 45. SurfControl plc Annual report 2005 www.surfcontrol.com
5. Staff costs
2005 2004 2003
$’000 $’000 $’000
Wages and salaries 40,579 35,077 31,287
Social security costs 3,561 3,221 2,964
Other pension costs (note 20) 1,055 1,013 845
45,195 39,311 35,096
Staff costs include directors’ remuneration which is analysed further in the Directors’ Remuneration report on page 23.
The average monthly number of employees during the year was:
2005 2004 2003
Selling and distribution 298 270 245
Research and development 141 119 108
Administration 79 75 75
518 464 428
6. Operating profit
2005 2004 2003
$’000 $’000 $’000
Operating profit is arrived at after charging:
Depreciation:
Owned assets 2,272 1,754 1,580
Assets held under finance leases and hire purchase contracts 36 43 47
Loss on disposal of fixed assets 23 31 109
Amortisation of intangible assets 7,811 1,351 1,152
Auditors’ remuneration 324 296 284
Other fees payable to the auditors and their associates:
Further assurance services 104 77 67
Tax advisory services 383 547 419
Other non-audit services 8 29
Operating lease rentals:
Equipment and vehicles 63 115 105
Land and buildings (including onerous lease charge – note 3) 4,441 2,703 2,572
Other fees payable to the auditors and their associates in the year include tax advisory fees which primarily relate to tax compliance, co-ordination and planning.
Further assurance services in the year mainly relate to fees for review of the Group’s unaudited interim and quarterly financial statements, together with
advice in respect to transition to International Financial Reporting Standards. In addition, amounts paid to the auditors in connection with acquisition due
diligence that have been capitalised was $28,000 (2004: $124,000) (2003: $nil).
Auditors’ remuneration for audit services includes $111,000 (2004: $100,000) (2003: $93,000) in respect of the parent company.
Notes to the Financial Statements
for the year ended 30 June 2005 46. SurfControl plc Annual report 2005 www.surfcontrol.com
7. Net interest receivable and similar items
2005 2004 2003
$’000 $’000 $’000
Bank and bank loan interest payable (2) (3) (2)
Finance lease and hire purchase interest payable (4) (8) (10)
Other interest payable (23) (9) (40)
(29) (20) (52)
Bank interest receivable 2,510 1,879 1,157
Net interest receivable 2,481 1,859 1,105
8. Taxation on ordinary activities
2005 2004 2003
$’000 $’000 $’000
US Federal and state tax (509) (669) (1,927)
Non US Corporation tax 1,047 (4,847) (3,729)
Adjustments in respect of previous years 432 222 (136)
Total current tax credit/(charge) 970 (5,294) (5,792)
Deferred tax (2,146) 2,432 3,276
Total tax charge (1,176) (2,862) (2,516)
Deferred tax assets have been recognised in respect of tax losses that are more likely than not to be utilised in the foreseeable future and other timing
differences existing at the financial year end. The total current tax charge in the year is lower than that implied by the standard rate of corporation tax in 
the United Kingdom of 30%. The differences are explained below:
2005 2004 2003
Reconciliation of total current tax charge $’000 $’000 $’000
Profit on ordinary activities before taxation 7,621 14,399 8,879
Tax charge on profit on ordinary activities implied by the UK standard rate of 30% 2,286 4,320 2,664
Factors affecting the tax charge:
Expenses not deductible for tax purposes on a permanent basis 135 (37) 778
Other short-term timing differences (3,464) (2,332) 3,941
Adjustment to tax charge in respect of prior years (432) (222) 136
Deferral of tax losses arising in the year 1,135 3,730 90
Utilisation of prior year tax losses in the year (630) (165) (1,817)
Total current tax (credit)/charge (970) 5,294 5,792
A reconciliation to the deferred tax assets balance carried in the Group balance sheet and shown in note 12 is given below:
$’000
Deferred tax assets at 1 July 2004 6,680
Deferred tax charge from above (2,146)
Exchange differences arising in the year (6)
Deferred tax assets at 30 June 2005 4,528 
Notes to the Financial Statements
for the year ended 30 June 2005 47. SurfControl plc Annual report 2005 www.surfcontrol.com
Notes to the Financial Statements
for the year ended 30 June 2005
9. Intangible assets
Intellectual
Goodwill property Total
Group $’000 $’000 $’000
Cost:
At 1 July 2004 711 13,194 13,905
Arising from current year acquisitions (a) 7 7,000 7,007
Arising from prior year acquisitions (b) (174) (1,808) (1,982)
At 30 June 2005 544 18,386 18,930
Amortisation:
At 1 July 2004 (68) (1,283) (1,351)
Provided during the year (476) (7,335) (7,811)
At 30 June 2005 (544) (8,618) (9,162)
Net book value at 30 June 2005 – 9,768 9,768
Net book value at 30 June 2004 643 11,911 12,554
Net book value at 30 June 2003 –––
Further details of the consideration given for acquisitions and the provisional fair value of net assets acquired is given in (a) and (b) below.
The intellectual property relates to the written down value of the following acquired technologies:
$’000
Spyware and extended threat protection technology (acquired February 2005 – see (a) on page 48) 5,834
Linux based appliance technology (acquired April 2004 – see (b) on page 48) 3,934
9,768
Intellectual
property
Company $’000
Cost:
At 1 July 2004 13,194
Arising from current year acquisitions (a) 7,000
Arising from prior year acquisitions (b) (1,808)
At 30 June 2005 18,386
Amortisation:
At 1 July 2004 (1,283)
Provided during the year (7,335)
At 30 June 2005 (8,618)
Net book value at 30 June 2005 9,768
Net book value at 30 June 2004 11,911
Net book value at 30 June 2003 – 48. SurfControl plc Annual report 2005
Notes to the Financial Statements
for the year ended 30 June 2005
9. Intangible assets continued
(a) Acquisition of Spyware and extended threat protection technology and software engineering unit
On 28 February 2005 the Group completed the purchase of Spyware and extended threat protection technology from Apreo Ltd, a company incorporated
in Israel, together with assets relating to a software engineering unit based in Israel. The aggregate consideration was $7,017,000, comprising $6,902,000
purchase consideration and acquisition costs of $115,000. Included in the purchase consideration is deferred consideration of $70,000 in respect to a sales
related earn-out that may be payable in February 2006.
An analysis of the book and provisional fair value of assets and liabilities is given below:
Book Fair value Provisional
value adjustment fair values
$’000 $’000 $’000
Intellectual property –– 7,000 
Net assets of Israeli based software engineering operation:
Fixed assets 17 (7) 10 
Net assets 10 
Total provisional fair value of net assets of Israeli operation and intellectual property 7,010 
Acquisition cost (1) 7,017 
Goodwill (written off in the year) 7 
(1) Acquisition cost was settled by:
Cash consideration including costs 6,947 
Deferred consideration (payable in cash or treasury shares) 70 
7,017 
The software engineering operation in Israel had no reported profit or loss in current prior periods as it formed part of Apreo Limited.
(b) Adjustments to the carrying value of goodwill and appliance technology
During the fourth quarter the Group finalised the value of an earn-out in respect to the acquisition of appliance technology acquired from SecureM, Inc 
and its China based sales and distribution operation. The estimated earnout of $3,123,000 at 30 June 2004 was reduced by $1,808,000 to $1,315,000. As at 
30 June 2005 the amount of the earn-out that remained payable was $589,000. During the fourth quarter the Group also made completion and hindsight
period adjustments in respect to the provisional fair value of assets and liabilities of the sales and distribution operation. These adjustments amounted to 
a reduction in acquired net liabilities, and of acquired goodwill of $174,000. The adjustments related to payroll compensation and general accruals. 49. SurfControl plc Annual report 2005 www.surfcontrol.com
10. Tangible fixed assets
Computer 
equipment Construction Fixtures Motor 
and software in progress and fittings vehicles Total
Group $’000 $’000 $’000 $’000 $’000
Cost:
At 1 July 2004 6,318 509 2,675 96 9,598
Exchange adjustment (24) 1 (13) (1) (37)
Additions 1,352 47 726 – 2,125
Acquisition of business undertaking 10––– 10
Disposals (872) – (226) – (1,098)
Reclassification 571 (534) (37) – –
At 30 June 2005 7,355 23 3,125 95 10,598
Depreciation:
At 1 July 2004 4,007 – 1,441 85 5,533
Exchange adjustment (30) – (15) (3) (48)
Provided during the year 1,688 – 607 13 2,308
Disposals (854) – (204) – (1,058)
At 30 June 2005 4,811 – 1,829 95 6,735
Net book value at 30 June 2005 2,544 23 1,296 – 3,863
Net book value at 30 June 2004 2,311 509 1,234 11 4,065
Net book value at 30 June 2003 1,904 333 996 35 3,268
Computer 
equipment Construction Fixtures Motor 
and software in progress and fittings vehicles Total
Company $’000 $’000 $’000 $’000 $’000
Cost:
At 1 July 2004 2,400 88 1,188 96 3,772
Exchange adjustment (57) 1 (26) (1) (83)
Additions 765 22 235 – 1,022
Reclassification 74 (87) 13 – –
At 30 June 2005 3,182 24 1,410 95 4,711
Depreciation:
At 1 July 2004 1,424 – 837 85 2,346
Exchange adjustment (42) – (19) (3) (64)
Provided during the year 733 – 245 13 991
Reclassification (3) – 3 – –
At 30 June 2005 2,112 – 1,066 95 3,273
Net book value at 30 June 2005 1,070 24 344 – 1,438 
Net book value at 30 June 2004 976 88 351 11 1,426 
Net book value at 30 June 2003 744 – 535 29 1,308 
Notes to the Financial Statements
for the year ended 30 June 2005 50. SurfControl plc Annual report 2005
10. Tangible fixed assets continued
Assets held under finance lease agreements included within tangible assets were as follows:
Motor Fixtures
vehicles and fittings
Group $’000 $’000
Net book value at 30 June 2005 –25
Net book value at 30 June 2004 11 48 
Net book value at 30 June 2003 32 64 
Depreciation charged on fixed assets held under finance lease arrangements was as follows: motor vehicles $13,000 (2004: $11,000) (2003: $29,000) and on
fixtures and fittings $23,000 (2004: $22,000) (2003: $20,000).
Motor Fixtures
vehicles and fittings
Company $’000 $’000
Net book value at 30 June 2005 –25
Net book value at 30 June 2004 11 48
Net book value at 30 June 2003 32 64
Depreciation charged on fixed assets held under finance leases was as for Group.
11. Investments
2005 2004 2003
Group $’000 $’000 $’000
Equity investments:
At 1 July 2004/1 July 2003/1 July 2002 31 29 7
Additions – –22
Exchange adjustment – 2–
Equity investments at 30 June 2005/30 June 2004/30 June 2003 31 31 29
Notes to the Financial Statements
for the year ended 30 June 2005 51. SurfControl plc Annual report 2005 www.surfcontrol.com
Notes to the Financial Statements
for the year ended 30 June 2005
11. Investments continued
Equity investments, which are stated at cost, wholly relate to bond holdings required by Austrian law to cover severance obligations towards employees
based in that country, payable in the event of a compulsory winding up of SurfControl GmbH.
2005 2004 2003
Company $’000 $’000 $’000
Investments in subsidiary undertakings:
At 1 July 2004/1 July 2003/1 July 2002 59,045 59,045 55,032
Transfers 116,211 – 4,013
Share subscriptions 326 ––
At 30 June 2005/30 June 2004/30 June 2003 175,582 59,045 59,045
Amounts owed by subsidiary undertakings:
At 1 July 2004/1 July 2003/1 July 2002 140,709 128,163 131,427
Transfers (116,211) (3,291) (4,013)
Net (reduction)/addition (21,591) 15,837 749
At 30 June 2005/30 June 2004/30 June 2003 2,907 140,709 128,163
Total investments in subsidiaries 178,489 199,754 187,208
Amounts owed by subsidiary undertakings are included within investments where the subsidiary and the Company have agreed that the debt will not 
be settled in the foreseeable future. During the year $116,211,000 owed by SurfControl, Inc to the Company was converted into share equity and certain
long-term amounts owed by subsidiary undertakings were settled by way of assignment of other inter-company debts around the Group.
The subsidiary undertakings, included in the Group accounts at 30 June 2005, are as shown below. All of these subsidiary undertakings with the exception
of Beijing Messagesoft Technology Co,. Ltd,. (“MessageSoft”) are directly and wholly owned. The Company, under the terms of its sale and purchase
agreement with SecureM, Inc. has control over the operational and financial policies of MessageSoft, and accordingly MessageSoft has been accounted for
as a subsidiary of the Group. All companies, including MessageSoft, are engaged in the Internet security market with the exception of SurfControl Share
Scheme Trustees Limited which is dormant.
Country of
Subsidiary name incorporation
SurfControl Inc United States
SurfControl GmbH
1
Austria
SurfControl BV Holland
SurfControl Pty Limited Australia
SurfControl (Japan) Limited United Kingdom
SurfControl (Israel) Limited United Kingdom
SurfControl (China) Limited United Kingdom
SurfControl Share Scheme Trustees Limited United Kingdom
Beijing SurfControl Network Security Co.,Ltd., Peoples’ Republic of China
Beijing Messagesoft Technology Co.,Ltd., Peoples’ Republic of China
1 The results of SurfControl GmbH, a company incorporated in Austria, include those of its wholly owned subsidiary SurfControl GmbH, a company incorporated in Germany, engaged in the
business of Internet security products. 52. SurfControl plc Annual report 2005
12. Debtors
2005 2004 2003
Group $’000 $’000 $’000
Trade debtors 22,299 20,524 17,647 
Other debtors 92 27 64 
Taxation recoverable 2,223 1,475 –
Deferred tax assets 4,528 6,680 4,184 
Prepayment and accrued income 3,428 2,975 2,243 
32,570 31,681 24,138 
Deferred tax assets are analysed as follows:
2005 2004 2003
$’000 $’000 $’000
Trading losses 3,132 6,212 3,204 
Deferred income 674 – 555 
Accelerated capital allowances 353 318 289 
Short-term timing differences 369 150 136 
4,528 6,680 4,184 
2005 2004 2003
Company $’000 $’000 $’000
Trade debtors 6,111 4,652 4,201 
Other debtors 3 6 14 
Taxation recoverable 867 ––
Deferred tax assets 722 395 425 
Prepayment and accrued income 1,247 1,356 1,074 
Amounts owed by subsidiary undertakings – 9,584 –
8,950 15,993 5,714
Deferred tax assets are analysed as follows:
2005 2004 2003
$’000 $’000 $’000
Accelerated capital allowances 353 318 289 
Short-term timing differences 369 77 136 
722 395 425
Notes to the Financial Statements
for the year ended 30 June 2005 53. SurfControl plc Annual report 2005 www.surfcontrol.com
Notes to the Financial Statements
for the year ended 30 June 2005
13. Creditors: amounts falling due within one year:
2005 2004 2003
Group $’000 $’000 $’000
Trade creditors 2,284 2,770 1,966 
Corporation tax 3,992 5,971 4,709 
Taxes and social security costs 2,268 2,004 1,527 
Other creditors – 308 –
Accruals 8,721 7,995 6,456 
Deferred income 57,040 49,036 37,542 
Obligations under finance leases and hire purchase contracts 19 19 41
Deferred consideration on acquisition of business undertakings 659 4,123 –
74,983 72,226 52,241 
2005 2004 2003
Company $’000 $’000 $’000
Trade creditors 852 1,532 776 
Corporation tax 1,209 4,147 1,989 
Taxes and social security costs 1,326 1,172 1,069 
Accruals 1,967 2,301 1,739 
Amounts owed to subsidiary undertakings 22,827 14,490 1,162 
Deferred income 13,162 10,678 7,446 
Obligations under finance leases and hire purchase contracts 19 19 41
Deferred consideration on acquisition of business undertakings 659 4,123 –
42,021 38,462 14,222 
14. Creditors: amounts falling due after more than one year:
2005 2004 2003
Group $’000 $’000 $’000
Deferred income:
Due within one to two years 20,292 18,399 10,871 
Due within two to five years 7,540 7,580 5,777 
Due after five years – – 62 
27,832 25,979 16,710 
Obligations under finance leases and hire purchase contracts:
Due within one to two years 3 19 18 
Due within two to five years – 3 14 
3 22 32 
27,835 26,001 16,742  54. SurfControl plc Annual report 2005
14. Creditors: amounts falling due after more than one year continued:
2005 2004 2003
Company $’000 $’000 $’000
Deferred income:
Due within one to two years 5,270 4,573 2,425 
Due within two to five years 2,113 2,157 1,361 
Due after five years – – 62 
7,383 6,730 3,848 
Amounts owed to subsidiary undertakings:
Due within one to two years 4,386 4,660 –
Due within two to five years 1,177 1,165 –
5,563 5,825 –
Obligations under finance leases and hire purchase contracts:
Due within one to two years 3 19 18 
Due within two to five years – 3 14 
3 22 32 
12,949 12,577 3,880 
The weighted average interest rate and period to maturity on finance lease obligations was 21% and 14 months respectively. There was no material
difference between the book and fair values attributable to finance leases shown in this note.
15. Provisions for liabilities and charges
2005
Group and Company $’000
As at 1 July 2004 446
Credited in the year (283)
Paid in the year (6)
Exchange difference arising in the year 4
As at 30 June 2005 161
At 30 June 2004 446 
At 30 June 2003 540 
The equity based compensation provision for UK Employer’s National Insurance and other non UK employment taxes relates to amounts payable on the
potential profit arising from the future exercise of unapproved options and long-term incentive share rights (“LTIPs”) granted to directors and employees.
The provision is charged to the Profit and Loss Account on a straight line basis over the relevant vesting period of the outstanding options and LTIPs. The
provision is based upon the Company’s closing share price on techMARK as at 30 June 2005 of £4.59. The above charge may vary as it is dependent upon
prevailing tax law, future share price movements and the number of options/LTIP shares in issue.
Notes to the Financial Statements
for the year ended 30 June 2005 55. SurfControl plc Annual report 2005 www.surfcontrol.com
Notes to the Financial Statements
for the year ended 30 June 2005
16. Share Capital
2005 2004 2003
Group and Company Number $’000 $’000 $’000
Authorised
Equity ordinary shares of £0.10 each 54,000,000 9,677 9,793 8,806
Total authorised share capital 9,677 9,793 8,806
Issued and fully paid
Equity ordinary shares of £0.10 each 31,114,572 5,032 5,027 4,946
(2004: 31,086,737) (2003:30,605,856)
Total called up share capital 5,032 5,027 4,946
The authorised share capital is denominated in UK sterling and consists of 54,000,000 10p ordinary shares with a nominal value of £5,400,000. Fluctuations 
in the reported US dollar value wholly arise from exchange rate fluctuations.
The issued ordinary share capital of the Company in UK sterling at 30 June 2005 was £3,111,457. The Company’s share capital has been translated into 
US dollars on a cumulative basis, at exchange rates prevailing as and when capital flows occurred. Movements in issued share capital over the period 
wholly arose from the exercise of Company share options.
The ordinary shares of 10p each carry one vote and have no fixed rights to dividends. They are entitled to participate equally in the assets of the Company
on a winding up.
Employee share schemes
The Group operated two share option schemes and a long-term share incentive plan (“LTIP”) during the financial year.
On 2 April 1992 the “JSB Computer Systems Executive Share Option Scheme” was adopted by the Board of Directors. The scheme has not been approved 
by the Inland Revenue. No options were granted during the financial year and there is no intention to grant further options under this scheme.
On 11 September 1998 the Board adopted the “JSB Software Technologies 1998 Executive Share Option Scheme” (“the 1998 scheme”). The scheme is
approved by the Inland Revenue although a schedule is incorporated into the rules allowing the grant of unapproved options. The scheme is administered
by the Remuneration Committee.
On 14 July 2000 in an Extraordinary General Meeting of the Company shareholders approved minor amendments to the 1998 scheme including revision 
to the maximum limit on the number of shares for which options may be granted from 15% to 20% of the issued ordinary share capital.
On 21 October 2004 the Board adopted the “SurfControl long-term incentive plan” . The LTIP is administered by the Remuneration Committee and is not
approved for Inland Revenue purposes. The practical operation of the LTIP and Company share option schemes is described in the Directors’ Remuneration
Report on pages 23 to 33. 56. SurfControl plc Annual report 2005
Notes to the Financial Statements
for the year ended 30 June 2005
16. Share Capital continued
Share Options
As at 30 June 2005, the following options to subscribe were outstanding in respect of ordinary shares of 10p each.
No of Shares Exercise Price Exercise Period
5,000 242p 1 June 2002 to 31 May 2009
200,000 331p 15 July 2000 to 15 July 2009
49,750 321p 5 October 2000 to 4 October 2009
205,900 434p 30 November 2000 to 29 November 2009
147,200 849p 9 February 2001 to 8 February 2010
2,000 1238p 9 February 2001 to 8 February 2010
189,600 849p 21 February 2001 to 20 February 2010
96,400 849p 15 March 2001 to 14 March 2010
1,000 1712p 22 March 2001 to 21 March 2010
5,600 849p 13 April 2001 to 12 April 2010
1,600 849p 17 April 2001 to 16 April 2010
402,800 849p 14 June 2001 to 13 June 2010
8,000 1425p 14 June 2001 to 13 June 2010
9,600 849p 29 June 2001 to 28 June 2010
45,203 849p 18 July 2001 to 17 July 2010
923 2025p 18 July 2001 to 17 July 2010
11,816 849p 30 July 2001 to 29 July 2010
39,408 849p 6 August 2001 to 5 August 2010
15,571 849p 30 August 2001 to 29 August 2010
18,155 849p 28 September 2001 to 27 September 2010
12,266 849p 30 October 2001 to 29 October 2010
260,000 849p 10 September 2001 to 9 September 2010
108,386 738p 29 November 2001 to 28 November 2010
15,077 875p 3 December 2001 to 2 December 2010
3,446 849p 30 December 2001 to 29 December 2010
15,530 849p 30 January 2002 to 29 January 2011
2,307 1243p 30 January 2002 to 29 January 2011
4,999 998p 27 February 2002 to 26 February 2011
3,488 448p 29 March 2002 to 28 March 2011
27,769 660p 29 April 2002 to 28 April 2011
4,052 545p 30 May 2002 to 29 May 2011
3,718 365p 29 June 2002 to 28 June 2011
187,500 365p 30 June 2002 to 29 June 2011
3,750 394p 15 July 2002 to 14 July 2011
2,500 392p 19 August 2002 to 18 August 2011
5,625 268p 23 September 2002 to 22 September 2011
5,000 384p 28 October 2002 to 27 October 2011
3,333 493p 1 January 2003 to 31 December 2012
83,916 403p 30 June 2003 to 29 June 2012
290,000 421p 3 July 2003 to 2 July 2012
10,000 543p 5 July 2003 to 4 July 2012
36,500 647.5p 2 July 2004 to 1 July 2013
13,750 762.5p 29 October 2004 to 28 October 2013
5,000 552.5p 5 April 2005 to 4 April 2014
5,000 576p 9 June 2005 to 8 June 2014
187,000 620p 28 June 2005 to 27 June 2014
75,000 508p 16 December 2005 to 15 December 2014
15,000 645p 1 March 2006 to 28 February 2015
300,000 475p 29 June 2006 to 29 June 2015
3,145,438 57. SurfControl plc Annual report 2005 www.surfcontrol.com
Notes to the Financial Statements
for the year ended 30 June 2005
16. Share Capital continued
LTIP shares
As at 30 June 2005 the following rights to nil cost performance based LTIP shares were:
Number of shares Vesting period
167,154 21 October 2004 to 21 October 2007
105,727 30 June 2005 to 30 June 2008
272,881
The average share price (based on the Company’s share price as shown in the Official List of the London Stock Exchange) during the year was £5.62, and the
closing middle market price on 30 June 2005 was £4.59 (30 June 2004: £6.10) (30 June 2003: £6.38).
17. Shareholders’ funds
Capital Share Profit
Shareredemption premium and loss
capital reserve account account Total
Group $’000 $’000 $’000 $’000 $’000
As at 1 July 2004 5,027 882 3,803 27,492 37,204
Exercise of options in the period 5 – 184 – 189
Retained profit for the period – – – 6,445 6,445
Purchase of own shares for treasury – – – (11,525) (11,525)
Equity based compensation – – – 102 102
Unrealised exchange difference on translation – – – (118) (118)
As at 30 June 2005 5,032 882 3,987 22,396 32,297
As at 30 June 2004 5,027 882 3,803 27,492 37,204
As at 30 June 2003 4,946 882 79 13,712 19,619
During the year the Company purchased 1,089,500 of its own shares at a total cost of $11,525,000 including fees, and at an average price of £5.71 ($10.58).
An amount of $102,000 in respect of the intrinsic value of long-term incentive share rights, has been charged to the profit and loss account within the
equity based compensation charge, and has been credited through profit and loss reserve.
Capital Share Profit
Shareredemption premium Merger and loss
capital reserve account reserve account Total
Company $’000 $’000 $’000 $’000 $’000 $’000
As at 1 July 2004 5,027 882 3,803 130,407 93,110 233,229
Exercise of options in the period 5 – 184 – – 189
Retained profit for the period –––– 3,669 3,669
Purchase of own shares for treasury –––– (11,525) (11,525)
Equity based compensation (as noted above) 102 102
Unrealised exchange difference on translation –––– (23,792) (23,792)
As at 30 June 2005 5,032 882 3,987 130,407 61,564 201,872
As at 30 June 2004 5,027 882 3,803 130,407 93,110 233,229
As at 30 June 2003 4,946 882 79 130,407 75,777 212,091
The purchase of own shares was as for Group.
SurfControl plc has not presented its own profit and loss account as permitted by Section 230 of the Companies Act 1985. A profit of $3,669,000 relating 
to the Company is dealt with in the consolidated financial statements of SurfControl plc (2004: profit $2,190,000) (2003: profit $4,349,000). The aggregate
nominal value of ordinary shares allotted in the year was $5,000 (2004: $81,000) (2003: $42,000). 58. SurfControl plc Annual report 2005
Notes to the Financial Statements
for the year ended 30 June 2005
18. Reconciliation of movement in shareholders’ funds
2005 2004 2003
Group $’000 $’000 $’000
Profit on ordinary activities after taxation 6,445 11,537 6,363
New share capital subscribed 189 3,805 1,271
Purchase of own shares for treasury (11,525) (1,112) –
Equity based compensation 102 ––
Unrealised exchange difference on translation (118) 3,355 1,095
Net (decrease)/increase in shareholders’ funds (4,907) 17,585 8,729
Opening shareholders’ funds 37,204 19,619 10,890
Closing shareholders’ funds 32,297 37,204 19,619
2005 2004 2003
Company $’000 $’000 $’000
Profit on ordinary activities after taxation 3,669 2,190 4,349
New share capital subscribed 189 3,805 1,271
Purchase of own shares for treasury (11,525) (1,112) –
Equity based compensation 102 ––
Unrealised exchange difference on translation (23,792) 16,255 11,028
Net (decrease)/ increase in shareholders’ funds (31,357) 21,138 16,648
Opening shareholders’ funds 233,229 212,091 195,443
Closing shareholders’ funds 201,872 233,229 212,091
19. Other financial commitments
The Group’s commitments in respect of non-cancellable operating lease rentals over the next twelve months are:
(a) Lease commitments
Leasehold Leasehold Leasehold 
property Other property Other property Other
2005 2005 2004 2004 2003 2003
Group $’000 $’000 $’000 $’000 $’000 $’000
In respect of leases expiring:
Within one year 462 2 361 26 101 38
In one to two years 1,723 8 188 – 625 41
In two to five years 97 29 1,274 39 1,281 38
In more than five years 1,298 – 462 – 406 –
3,580 39 2,285 65 2,413 117 59. SurfControl plc Annual report 2005 www.surfcontrol.com
Notes to the Financial Statements
for the year ended 30 June 2005
19. Other financial commitments continued
The Company’s commitments in respect of non-cancellable operating lease rentals over the next twelve months are:
Leasehold Leasehold Leasehold 
property Other property Other property Other
2005 2005 2004 2004 2003 2003
Company $’000 $’000 $’000 $’000 $’000 $’000
In respect of leases expiring:
Within one year 28 – 21 – 34 –
In one to two years –– 53–––
In two to five years 97 22 –22 – 28
In more than five years 455 – 462 – 406 –
580 22 536 22 440 28
(b) Capital commitments
The Group and Company had the following capital commitments authorised by directors but not provided for in the accounts:
2005 2004 2003
Group $’000 $’000 $’000
Contracted for 74 66 275
Authorised but not contracted for – –54
2005 2004 2003
Company $’000 $’000 $’000
Contracted for 56 3–
Authorised but not contracted for – –54
20. Pension costs
The Group operates defined contribution schemes. The assets of the schemes are held separately from those in the Group in independently administered
funds. The pension charge included in staff costs in note 5, represents contributions payable by the Group to the funds and amounted to $1,055,000 
(2004: $1,013,000) (2003: $845,000). The amount of pension cost accrued by the Group was $57,000 (2004: $23,000) (2003: $11,000).
21. Reconciliation of operating cash flows
2005 2004 2003
$’000 $’000 $’000
Operating profit 5,140 12,229 7,393
Depreciation 2,308 1,797 1,627
Amortisation of intangible assets 7,811 1,351 1,152
Loss on sale of tangible fixed assets 23 31 109
Decrease in stocks 69 31 18
Increase in debtors (2,552) (2,973) (5,430)
Increase in creditors 10,610 20,302 18,780
(Decrease)/increase in provisions for liabilities and charges (289) (131) 444
Net cash inflow from operating activities 23,120 32,637 24,093
Net cash flow from operating activities before cash flows for exceptional items was $23,793,000 (2004: $32,637,000) (2003: $24,093,000). 60. SurfControl plc Annual report 2005
Notes to the Financial Statements
for the year ended 30 June 2005
22. Returns on investments and servicing of finance
2005 2004 2003
$’000 $’000 $’000
Finance lease and hire purchase interest paid (4) (8) (10)
Bank interest paid (2) (3) (2)
Other interest paid (21) (9) (29)
Bank interest received 2,654 1,812 782
Net cash inflow from returns on investment and servicing of finance 2,627 1,792 741
23. Analysis of net funds
Foreign
At 1 July exchange At 30 June At 30 June At 30 June 
2004 Cash flow differences 2005 2004 2003
$’000 $’000 $’000 $’000 $’000 $’000
Overnight cash balances and cash in hand 50,518 4,127 (6) 54,639 50,518 34,262
Term deposits 36,959 (2,550) (4) 34,405 36,959 27,445
Cash at bank and in hand 87,477 1,577 (10) 89,044 87,477 61,707
Finance leases (41) 19 – (22) (41) (73)
Total 87,436 1,596 (10) 89,022 87,436 61,634
The principal financial risks faced by the Group are counterparty, exchange rate, interest rate and liquidity risks. Counterparty risk is managed by placing cash
deposits with banks principally in the UK and US, which have satisfactory credit ratings. To balance interest rate and liquidity risk the Group places its cash
balances in excess of immediate requirements on deposit with the intention of maximising income whilst ensuring funds are available to meet the Group’s
expenditure requirements. Exchange rate risk is managed by minimising balances in currencies other than those of local operations. The Group’s policy is 
not to enter into forward exchange contracts.
Cash and other liquid resources consist of cash held in current/deposit accounts, money market funds, certificates of deposit, and money market term
deposits. Liquid resources at 30 June 2005 had a weighted average period to maturity of eight weeks and earned interest at a weighted average rate of
3.08% per annum.
There was no significant differences between book value and fair value (determined by discounting future cash flows at current interest rates) for these
funds. No details regarding financial exposure of the short-term debtors and creditors have been included. The Group does not engage in any hedging 
in respect of interest rate risks. There are no material committed undrawn facilities at year end. 61. SurfControl plc Annual report 2005 www.surfcontrol.com
Notes to the Financial Statements
for the year ended 30 June 2005
24. Financial instruments
As permitted by FRS 13 “Derivatives and other financial instruments: Disclosures” , short-term debtors and creditors have been excluded from the the
following analyses.
The interest rate risk profile of financial assets and liabilities were as follows:
Non interest Floating Fixed 2005
bearing rate rate Total
Group 2005 $’000 $’000 $’000 $’000
Financial assets:
Currency
US dollar 590 35,683 20,254 56,527
UK sterling 1,918 1,841 23,554 27,313
Euro 846 1,810 306 2,962
Australian dollar – 1,698 415 2,113
Chinese yuan 76–– 76
Japanese yen 59–– 59
Singapore dollar 25–– 25
3,514 41,032 44,529 89,075
Non interest Floating Fixed 2004
bearing rate rate Total
Group 2004 $’000 $’000 $’000 $’000
Financial assets:
Currency
US dollar 951 23,541 20,755 45,247
UK sterling 1,502 4,401 32,414 38,317
Euro 827 1,826 304 2,957
Australian dollar – 139 471 610
Chinese Yuan 346 – 346
3,626 29,907 53,944 87,477 62. SurfControl plc Annual report 2005
Notes to the Financial Statements
for the year ended 30 June 2005
24. Financial instruments continued
Non interest Floating Fixed 2003
bearing rate rate Total
Group 2003 $’000 $’000 $’000 $’000
Financial assets:
Currency
US dollar 864 24,772 – 25,636
UK sterling 64 8,071 27,043 35,178
Euro 109 225 – 334
Australian dollar – 154 403 557
Singapore dollar –2 –2
1,037 33,224 27,446 61,707
There were no financial liabilities except for finance lease and hire purchase obligations as at 30 June 2005 (2004: $nil) (2003: $nil). Floating and fixed rate
financial assets comprise cash at bank and in hand and bear interest at prevailing market rates. The UK operations held cash balances at 30 June 2005 
of $29,836,000 (2004: $16,300,000) (2003: $1,199,000) denominated in US dollars. Other than this and long-term intercompany loans, the operations within 
the Group had no significant monetary assets or liabilities denominated in currencies other than their own. There are no material unrecognised gains or
losses at the beginning or end of the year.
25. Related party transactions
Transactions between companies within the Group are not disclosed as all such transactions are eliminated on consolidation. There were no other related
party transactions for the financial periods under review. 63. SurfControl plc Annual report 2005 www.surfcontrol.com
Unaudited Group Profit and Loss Account
for the quarters ended 30 June 2005
Full year
30 June 31 March 31 December 30 September 30 June 
2005 2005 2004 2004 2005
$’000 $’000 $’000 $’000 $’000
Turnover 26,075 24,637 24,664 22,462 97,838
Cost of sales (635) (403) (403) (305) (1,746)
Gross profit 25,440 24,234 24,261 22,157 96,092
Selling and distribution (12,751) (11,818) (11,512) (11,272) (47,353)
Research and development (3,704) (3,318) (3,158) (2,784) (12,964)
General and administrative (4,783) (4,718) (4,922) (4,626) (19,049)
Amortisation of intangible assets and depreciation (2,879) (2,641) (2,328) (2,271) (10,119)
Equity based compensation 330 (218) 11 58 181
Exceptional item – onerous lease – –– (1,648) (1,648)
Total administrative expenses (11,036) (10,895) (10,397) (11,271) (43,599)
Operating profit 1,653 1,521 2,352 (386) 5,140
Net interest receivable 718 622 582 559 2,481
Profit on ordinary activities before taxation 2,371 2,143 2,934 173 7,621
Tax on profit on ordinary activities (381) (318) (451) (26) (1,176)
Profit on ordinary activities after taxation 1,990 1,825 2,483 147 6,445
Basic earnings per ordinary share (cents) 6.6 6.1 8.2 0.5 21.3
Reconciliation of profit on ordinary activities after taxation to pro-forma profit after taxation:
Profit on ordinary activities after taxation 1,990 1,825 2,483 147 6,445
Amortisation of intangible assets 2,298 2,037 1,738 1,738 7,811
Equity based compensation charge (330) 218 (11) (58) (181)
Exceptional item – onerous lease charge – –– 1,648 1,648
Pro-forma profit on ordinary activities after taxation 3,958 4,080 4,210 3,475 15,723 
Reconciliation of pro-forma profit after taxation to EBITDA
(Earnings before exceptional item, net interest, taxation,depreciation, amortisation
of intangible assets, and equity based compensation charge):
Pro-forma profit on ordinary activities after taxation 3,958 4,080 4,210 3,475 15,723
Tax on profit on ordinary activities 381 318 451 26 1,176
Depreciation 581 604 590 533 2,308
Net interest receivable (718) (622) (582) (559) (2,481)
EBITDA 4,202 4,380 4,669 3,475 16,726  “This year has seen the attainment of a long
standing goal of becoming a circa $100m
revenue company occupying a leadership
position within our target market. It is 
the culmination of years of work and an
excellent platform from which to launch
into the next stage of the Company’s
development. With the addition of 
Pat Sueltz to our management team 
we have significantly strengthened our
ability to take full advantage of the market
opportunity open to us. Accordingly, I look
forward to the future with confidence.”
Steve Purdham, Chief Strategy Ofﬁcer
■ The Internet is critical to organisations worldwide.
■ It is also their biggest security threat.
■ Malicious threats such as spam, phishing and
spyware constantly and cumulatively assault
companies – with new threats emerging
almost daily.
■ These threats impact employee productivity,
drain network resources, create financial losses 
and increase liability risks.
SURFCONTROL STOPS THESE THREATS
SurfControl is the world’s leading Internet security company
stopping blended and malicious digital threats from
assaulting companies. SurfControl’s Enterprise Protection
Suite™ is the only threat management system with Adaptive
Threat Intelligence™ to continuously filter inbound and
outbound Web, e-mail and IM-P2P traffic. Thus, SurfControl
customers are protected against known, emerging, internal
and customer-specific threats.
Registrars
Capita Registrars
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU
Depository for ADS
Bankers Trust Company
4 Albany Street
New Y ork
New Y ork 10006
United States
Registered Office
Riverside
Mountbatten Way
Congleton
Cheshire CW12 1DY
Bankers
Royal Bank of Scotland plc
2 St Philip’s Place
Birmingham B3 2RB
Solicitors
Hammonds Solicitors
Trinity Court
16 John Dalton Street
Manchester M60 8HS
Brokers
UBS Limited
1 Finsbury Avenue
London EC2M 2PP
Advisers SurfControl plc Annual report 2005
Offices
SurfControl Inc
1900 West Park Drive,
Suite 180, Westborough,
Massachusetts 01581, USA
Tel: +1 (508) 621 3900
Fax: +1 (508) 621 3921
E-mail: sales.us@surfcontrol.com
5550 Scotts Valley Drive,
Scotts Valley , California 95066, USA 
Tel: +1 (831) 431 1400
Fax: +1 (831) 431 1800
E-mail: info@surfcontrol.com 
SurfControl plc
Riverside, Mountbatten Way ,
Congleton, Cheshire CW12 1DY
United Kingdom
Tel: +44 (0)1260 296 200
Fax: +44 (0)1260 296 201
E-mail: surfinfo@surfcontrol.com
SurfControl plc – Singapore
Level 58 Republic Plaza,
9 Raffles Place,
Singapore 048619
Tel: +65 6823 1312
Fax: +65 6823 1481
E-mail: support.sg@surfcontrol.com
SurfControl plc – France
79 Avenue Francois Arago,
92017 Nanterre,
France
Tel: +33 1 46699181
Fax: +33 1 47859140
E-mail: info.fr@surfcontrol.com
SurfControl (Israel) Ltd – Israel
C12 Ramat Yam Street,
Herzeliya,
Israel
Tel: +972 9 957 9912
Fax: +972 9 957 9914
SurfControl (Japan) Ltd – Japan
Kamiyacho MT Building,
14/F , 4-3-20 T oranomon, Minato-Ku
Tokyo 105 001
Tel: +81 3 5404 3818
SurfControl GmbH 
Dorotheergasse 7,
A-1010 Vienna, Austria
Tel: +43 1 513 44 15
Fax: +43 1 513 44 02
E-mail: sales.at@surfcontrol.com 
SurfControl GmbH
Rüsterstraße 13,
D-60325 Frankfurt am Main,
Germany
Tel: +49 69 70 79 86 0 
Fax: +49 69 70 79 86 20
E-mail: sales.de@surfcontrol.com
SurfControl BV
Schouwburgplein 30-34,
3012 CL Rotterdam,
The Netherlands 
Tel: +31 (0) 10 402 0000 
Fax: +31 (0) 10 402 0099
E-mail: sales.nl@surfcontrol.com
SurfControl Pty Ltd
Level 1, 19 Havilah Street,
Chatswood, NSW 2067 
Australia 
Tel: +61 (0)2 9414 0000 
Fax: +61 (0)2 9414 0099
E-mail: sales.au@surfcontrol.com
Beijing SurfControl Network 
Security Co., Ltd
Office T ower C2, 3rd Floor ,
Oriental Plaza, Beijing, 100 738, China
Tel: +86 10 8518 8860
Fax: +86 10 8518 0067
E-mail: info@messagesoft.net
WWW.SURFCONTROL.COM
SurfControl plc
Annual report 2005
■ ENTERPRISE THREAT PROTECTION