Annual Report and Financial Statements 2005
Unifying IT infrastructure  Contents
InTechnology plc Annual Report and Financial Statements 2005
Highlights 1
Chairman’s introduction 2
Chief Executive Officer’s report 3
Financial review 6
Technology review 9
Management team 13
Directors’ report 15
Corporate governance 19
Remuneration report 22
Independent auditors’ report 26
Consolidated profit and loss account 27
Consolidated statement of total recognised gains and losses 28
Reconciliation of movements in Group shareholders’ funds 29
Balance sheets 30
Consolidated cash flow statement 31
Accounting policies 32
Notes to the financial statements 34
Notice of Annual General Meeting 58
Form of proxy for InTechnology plc 60
Corporate information 62 page 1
InTechnology plc Annual Report and Financial Statements 2005
Highlights
Financial highlights
Total turnover increased 28% to £283.5m
(2004 restated*: £221.9m)
• Specialist Distribution turnover up 26%
to £261.4m (2004 restated: £207.4m)
• Managed Services turnover up 52% to
£22.1m (2004: £14.5m)
Gross profit increased 31% to £52.9m 
(2004 restated: £40.5m)
EBITA increased to £4.4m 
(2004 restated: £1.4m)
Group operating loss reduced to £0.3m
(2004 restated: £3.0m)
Cash at bank and in hand of £10.5m (2004:
£16.4m) and net debt increased to £22.2m
(2004: £10.4m) to fund growth of working
capital, particularly in Continental Europe
Operational highlights
Specialist Distribution division:
• All areas enjoyed good revenue growth,
despite difficult trading conditions
• Particularly strong performance in
Security solutions
• Turnover in Continental Europe up 73%
• Network products division started during
the year
Managed Services division:
• Monthly operating profit (before
amortisation of goodwill) achieved in the
second half year
• New long-term contracts signed with
Jarvis Rail plc, Balfour Beatty, T Mobile,
Wanadoo and London Business School
• 60% of customers now taking two or
more services (of the 10 managed
services now offered by InTechnology)
• Partnership signed with IBM to sell VBAK
service through IBM’s UK sales network
* See Note 2 to the financial statements
0
2001
2002
2003
2004
2005
£250m
£300m
£200m
£150m
£100m
£50m
InTechnology 
Group Turnover Chairman’s introduction
page 2
InTechnology plc Annual Report and Financial Statements 2005
In the year ended 31 March 2005
InTechnology has made clear and sustained
progress across all parts of the group. Most
significantly we reduced operating losses
(before amortisation of goodwill) within our
Managed Services division to £2.0m (2004:
£7.8m) achieving the breakthrough into
monthly operating profit (before
amortisation of goodwill) during the second
half of the financial year. Managed Services
division operating losses were reduced to
£4.3m (2004: £10.0m). Revenues in the
Specialist Distribution division increased by
26% to £261.4m (2004 restated: £207.4m).
Through investment in recent years,
InTechnology has developed a range of
managed services which allow organisations
to free up valuable management time by
outsourcing specific areas of IT
infrastructure. This division now has a
portfolio of 10 services, from data backup
and IP telephony to hosting and other
network services, and is a fundamental part
of our long-term competitive strategy.
Despite difficult trading conditions in the IT
market, our distribution business has enjoyed
revenue growth in each of its geographic
territories. Distribution agreements with new
vendors and extensions to existing contracts
have contributed to this growth, with
particularly excellent results coming from
sales of security solutions in the UK and
Continental Europe.
In the final quarter of the year, we began
the distribution of network products, thus
providing a natural link between storage and
security and completing our IT infrastructure
offering.
InTechnology’s corporate objectives remain
consistent and clear – to offer a complete
range of products, solutions and services to
meet the IT challenges organisations face in
today’s network-based computing
environment. We also remain committed to
selling through the IT channel of resellers,
consultants and systems integrators.
Our strategy is serving us well and has put
the business in a strong position to meet the
challenges of the IT market in the year ahead. 
Finally, the energy, technical ability and
enthusiasm of our people never fails to
impress me and I would like to thank all our
staff, as well as our vendor and reseller
partners, for their contributions to
InTechnology in the last year.
Lord Parkinson
Chairman
29 June 2005
The Rt. Hon Lord Parkinson page 3
InTechnology plc Annual Report and Financial Statements 2005
Peter Wilkinson
Chief Executive Officer’s report
Overview
We are very pleased with the progress made
by the Group this year, characterised in
particular by significant revenue growth
across our Specialist Distribution business
and, latterly, by reaching monthly operating
profit (before amortisation of goodwill) in
our Managed Services division.
In a challenging trading environment, we
have seen our operating profit (before
amortisation of goodwill) increase to £4.4m
(2004 restated: £1.4m). Group operating loss
was reduced to £0.3m (2004 restated:
£3.0m). We have aggressive plans for future
revenue growth and increased profitability
and we have already restructured our sales
team, brought on board new vendors and,
with the intellectual property in the
business, developed our own service
technologies to support this objective. We
are confident that our strategy remains
sound and that we are on track to meet
market expectations of sustainable profit
before tax.
Managed Services
Our managed services portfolio allows
organisations to outsource specific areas of
IT infrastructure to free up valuable staff
resource, improve service levels, reduce
operational cost and deliver the flexibility to
scale the service according to business
requirements.
The Managed Services division has required
significant investment in the five years since
commencement, culminating this year in an
increase in sales revenue of 52% to £22.1m
(2004: £14.5m). In addition, the division has
moved into monthly operating profit (before
amortisation of goodwill) in the second half
of the year. This positive contribution is a
key factor in the significant reduction in
Group operating loss this year.
During the year, we have seen many new
long-term contracts from blue-chip and
public sector organisations including Jarvis
Rail plc, Balfour Beatty, T-Mobile, Wanadoo
and London Business School. This new
business, together with our existing customer
base, means we have grown our recurring
revenue stream to £23.2m (2004: £18.0m).
We are also delighted that 60% (2004: 58%)
of our customers take 2 or more of our
range of 10 managed services. We expect to
build on this trend with new services
launched during the last year and further
services to be launched in the new fiscal
year. These include:
• IP Voice Connect™: an IP telephony
service for business
• A new version of our successful VBAK®
data backup and recovery service aimed
at the SME market
• Data replication services for Network
Appliance and EMC products
Another major development is an exciting
partnership with IBM Business Continuity &
Recovery Services, which will see our VBAK®
service sold to IBM customers through their
UK sales network. We are already an IBM
Premier Business Partner for hardware and
software distribution and I expect this
extension of our long-standing relationship
to make a major contribution to sales
revenue next year. page 4
InTechnology plc Annual Report and Financial Statements 2005
Specialist Distribution
Despite a difficult trading environment
throughout the IT market, in particular
pressure on margins from vendors and
customers, our Specialist Distribution
division has increased sales by: 
• 16% in the UK
• 73% in Continental Europe
Gross margins have, however, been squeezed
as pressures from vendors and customers
have intensified.
We have seen much success this year in the
Distribution market, including:
• A strong performance in sales of
Network Appliance solutions in the year -
we expect to see the growth continue
• Becoming Europe’s leading distributor of
CheckPoint
• Extending our storage agreement with
Sun Microsystems to Channel
Development Partner for the entire
product range including storage,
enterprise servers and mobile computing 
• Becoming recognised as one of the
leading distributors for Nokia secure
mobile connectivity solutions in Europe,
the Middle East and Africa (‘EMEA’)
Following our acquisition of the specialist
security distributor Allasso on 31 July 2003,
we have now completed the integration of
all its operations across Continental Europe,
maximising the efficiency of the business
with centralised logistics, consistent
processes and a single management
information system. These internal changes
are combined with a focus on developing
customer relationships on a pan-European
basis with large resellers.
We are particularly pleased that our security
expertise was recognised by Microsoft in Q4
when they chose InTechnology to help them
move into the European IT security market.
In a new partnership agreement with
Microsoft and Network Engines, we will be
distributing Microsoft ISA server software on
the Network Engines platform in a 12-
month exclusive agreement throughout the
UK and Continental Europe.
Also, with corporate networks struggling to
cope with exponential increases in network
traffic, we began distribution of network
solutions in H1 to exploit this expanding
market. Our experience in running our own
national ethernet network in the UK
(‘LANnet’) means we can leverage our
existing skills to deliver data networking,
WAN/LAN, VPN, ethernet switching and
wireless networks. To date, we have signed
distribution agreements to sell Nortel and
Juniper network products across the UK and
Continental Europe.
Finally, in June 2004, we acquired the trade
and assets of NetConnect Training from
NetConnect Limited for cash consideration of
£900,000 and contingent consideration to a
maximum of £100,000. The business is fully
integrated into the Group and operates under
the InTechnology name. As a result, we are
the UK’s leading provider of authorised
storage, security and internet training, and
the world’s largest CheckPoint, Nokia and
Clearswift authorised training provider.
Harrogate Distribution Centre page 5
InTechnology plc Annual Report and Financial Statements 2005
Trading and operating performance
We achieved encouraging revenue growth
across all divisions, with Group turnover
increasing to £283.5m this year (2004
restated: £221.9m) 
• £198.2m (2004 restated: £170.8m) for the
UK specialist distribution division 
• £63.2m (2004: £36.6m) for the Continental
Europe specialist distribution division
• £22.1m (2004: £14.5m) for the Managed
Services division
However, against a background of gross
margin erosion across the industry, our UK
storage margins fell by 0.9% and security
solutions margins by 2.4% year-on-year. In
the European market, we experienced a 2.5%
drop in margins but nonetheless won
increased market share.
Meeting customer expectations
In the first half of the year, we carried out a
full review of our customers’ requirements
and have now implemented changes to our
organisational structure in order to meet
these needs and maximise our sales
opportunities.
Customer sales focus on the following:
• Developing the resellers’ market
opportunities from the full InTechnology
range of products, solutions and services.
• Maximising margins by reducing the cost
of sale
• Accelerating the speed at which the sale
is closed by the reseller
In support of customer sales, we have Vendor
teams to maintain our speciality and expertise
around our core competencies in Storage,
Data Management, Security and Networks.
A sea change in the
marketplace
We are experiencing a sea change in the IT
sales channel in relation to the market for
services; traditional reseller business models
which relied solely on sales of hardware to
established end user customers, are no longer
sustainable. End users increasingly want to
outsource parts of their IT infrastructure to
save cost and enable them to focus on their
own core IT objectives. As a result, we are
experiencing strong interest from major
channel reseller partners in our managed
services portfolio and see this as further
confirmation that our strategy is sound.
Outlook
We are optimistic about prospects for our
business in the year ahead. We are confident
that sales volumes can increase to counter
the pressures on gross margin within our
Specialist Distribution division.
The strong performance of these established
businesses, together with increased
recurring revenue streams and exciting
initiatives in our Managed Services division,
give me confidence in our prospects for
future growth and profitability.
Peter Wilkinson
Chief Executive Officer
29 June 2005
0
UK Specialist
Distribution
Continental Europe
Specialist Distribution
Managed
Services
£200m
2004
£150m
£100m
£50m
2005
Turnover 
by Division Financial review
page 6
InTechnology plc Annual Report and Financial Statements 2005
The table below compares this year’s results against prior year and provides a useful summary of the results by profit centre:
Turnover EBITA (i) Group operating profit / (loss)
2005 2004 +/(-) 2005 2004 +/(-) 2005 2004 +/(-)
(Restated (iv)) (Restated (iv)) (Restated (iv))
£m £m £m £m £m £m £m £m £m
UK Specialist Distribution (ii) 198.2 170.8 27.4 6.0 8.3 (2.3) 3.8 6.3 (2.5)
European Specialist 
Distribution (ii) 63.2 36.6 26.6 0.4 0.9 (0.5) 0.2 0.8 (0.6)
Total Specialist Distribution 261.4 207.4 54.0 6.4 9.2 (2.8) 4.0 7.1 (3.1)
Managed Services 22.1 14.5 7.6 (2.0) (7.7) 5.7 (4.3) (10.0) 5.7
4.4 1.5 2.9 (0.3) (2.9) 2.6
Costs of German subsidiary (iii) - (0.1) 0.1 - (0.1) 0.1
Group 283.5 221.9 61.6 4.4 1.4 3.0 (0.3) (3.0) 2.7
Notes:
(i) EBITA comprises earnings before interest, taxation and amortisation of goodwill.
(ii) Distribution includes the Allasso European security software distribution business acquired on 31 July 2003 and
therefore the 2004 comparatives include its trading for 8 months of the year.
(iii) In 2004 a provision of £0.1m was made in respect of property lease commitments in relation to the closure of the
Group’s German subsidiary.
(iv) The 2004 results have been restated to reflect the revised revenue recognition accounting policy, see note 2 to the
financial statements.
UK Specialist Distribution
Turnover growth was the result of the full
year effect of the Allasso acquisition,
together with strong sales in both storage
and security products. Sales growth was also
driven by partnerships with new vendors
such as Network Appliance and fresh
initiatives with existing vendors.
In common with other IT distributors,
increased margin pressure particularly from
vendors contributed to a reduction in
divisional EBITA, a trend witnessed
throughout the marketplace.
In the second half year, the integration of
storage and security businesses was
completed to provide one UK distribution
sales force. The new sales structure is
enabling us to give the maximum priority to
customer satisfaction and offer our full
range of storage, security and network
products and services through 1 focal point. page 7
InTechnology plc Annual Report and Financial Statements 2005
European Specialist
Distribution
Our European Specialist Distribution
business experienced significant revenue
growth, particularly in France and Spain. 
As in the UK, market pressures led to a
reduction in gross margins and hence we
failed to see the revenue gains feed through
to increased divisional EBITA.
We remain committed to expanding these
subsidiaries further by continuing to
increase the portfolio of security and other
network-centric products we offer.
Managed Services
Turnover increased by 52% to £22.1m (2004:
£14.5m) with a resultant increase in gross
margin. Tight control of operating costs
enabled us to see the improved margins feed
through to the bottom line with EBITA losses
significantly reduced to £2.0m (2004:
£7.8m). Indeed, in the second half year the
division achieved the key milestone of
monthly EBITA breakeven. Operating losses
were reduced to £4.3m (2004: £10.0m).
Goodwill
In accordance with FRS 11, we evaluated the
carrying value of the goodwill that arose
following the acquisition of the Allasso
group of companies on 31 July 2003. The
value in use has been derived from
discounted cash flow projections that cover
the 4 years from 1 April 2005. After this 4-
year period, the projections use a long-term
growth rate. Our confidence in the long-
term success of both our Specialist
Distribution division and Managed Services
division indicate that no impairment write
down is necessary this year.
Further to the acquisition of the Allasso
group of companies, based on current
projections we now estimate that an
additional €2,300,000 (£1,582,000 assuming
an exchange rate of £1 to €1.454) of
conditional consideration will become
payable by 31 July 2005 (see note 8 to the
financial statements).
Acquisition
On 18 June 2004, the Group acquired the
trade and assets of NetConnect Training
from NetConnect Limited for cash
consideration of £900,000 and contingent
consideration to a maximum of £100,000
(see note 20). The acquired business has now
been fully absorbed into the UK Specialist
Distribution business, to which it
contributed turnover of £1,260,000,
operating profit of £267,000 and operating
cash inflow of £159,000 during the year.
Revenue recognition
During the year we completed a
comprehensive review of our accounting
policy for revenue recognition in light of the
guidance provided by Application Note G, an
amendment to FRS 5. The review identified
instances where sales of equipment had
been recognised before we had fulfilled all
of our contractual obligations to the
customer. As a result, we have amended our
procedures such that we now only recognise
revenue on the sale of equipment when the
goods are received by the customer and page 8
InTechnology plc Annual Report and Financial Statements 2005
when there are no unfulfilled obligations
that affect the customer’s final acceptance
of the equipment. Previously, revenue was
recognised on shipment of equipment to the
customer. This has resulted in a prior year
adjustment with 2004 comparatives 
restated accordingly (see note 2 to the
Financial Statements).
Cash flow and liquidity
The Group had a net cash outflow from
operating activities of £2.0m (2004: £3.5m
inflow). This was largely as a result of an
increase in working capital requirements as
we grew turnover in our European
subsidiaries and funded unusually high stock
levels with a major storage vendor.
Cash at bank and in hand at the year-end
was £10.5m (2003: £16.4m). However,
funding of working capital to support
European growth together with continuing
capital expenditure in our Managed Services
division contributed to an increase in net
debt to £22.2m (2004: £10.4m).
Taxation
The tax charge of £0.1m (2004 restated:
£0.8m) on the loss on ordinary activities
before taxation of £2.5m (2004 restated:
£4.1m) arises largely because goodwill
amortisation is not a taxable deduction. 
The year’s tax charge has also been reduced
by £0.9m (2004: £nil) due to the recognition
of deferred tax assets, largely in respect of
accelerated capital allowances (see note 
16 to the financial statements). A full
reconciliation of the tax charge is provided
in note 5 to the financial statements.
Financial instruments
The Group’s policy is that no trading in
financial instruments is undertaken. 
The Group’s financial instruments comprise
borrowings, cash and liquid resources and
various items that arise directly from its
operations. The main risks arising from these
are interest rate risk, liquidity risk, and
foreign currency risk as the Group trades in
euro and US dollars. The remaining IBM loan
of €4,167,000 (£2,866,000 assuming an
exchange rate of £1 to €1.454) as explained
in note 15 to the financial statements
continues to act as a hedge against the euro
exposure arising from our investment in
Allasso Europe.
Current trading
InTechnology’s distribution marketplace
faces continued margin pressure and foreign
exchange volatility from fluctuations of the
US dollar to euro and sterling.
Having achieved an operating profit before
interest, tax and amortisation of goodwill on
a monthly basis in our Managed Services
division our challenge is to continue to grow
this business through further contract wins
and enhanced recurring revenue streams
which now stand at £23.2m per annum
(2004: £18.0m), by offering new services. 
I am confident our renewed customer focus,
new distributor agreements and ever
expanding portfolio of products and services
will improve both revenue and operating
profits in our distribution divisions both in
the UK and in Europe.
Andrew Kaberry
Finance Director
29 June 2005
Andrew Kaberry page 9
InTechnology plc Annual Report and Financial Statements 2005
Technology review
The past year has seen a continued focus
on the introduction of new products and
services which offer genuine solutions to
real business IT issues especially in the key
growth areas of Business Continuity,
Network security, Voice over IP, Information
Lifecycle Management and IP convergence.
Organisations of all sizes are facing rapid
increases in their data volumes and
especially spiralling email volumes. In
addition, new regulations require that data
must be kept securely and made available
over longer periods into the future and
effective Information Lifecycle
management is now mandatory.
The ever-present threat of IT system failure
or malicious attack has meant that the need
for data security and business continuity
technology is stronger than ever. IT
departments are under pressure to
responsibly address these business
requirements as well as improving standards
of performance and reducing cost.
At the same time, convergence of data
storage, data security and networking
technologies offers major opportunities for
dramatic improvements and cost savings in
IT infrastructure deployment and we are
now seeing strong evidence of a
widespread shift towards Voice over IP
based telephony.
Our Managed Services have been extended
in scope and range, our core business in
data storage has been augmented with
new vendor technologies, new security and
software solutions have been introduced
and a network products business has been
launched to complete our range of
offerings for today’s networked business
environment.
With this substantially enhanced portfolio,
InTechnology is strongly positioned to
service these exciting growth market
opportunities.
Managed Services
InTechnology’s Managed Services enable
businesses to effectively outsource key but
non-core business IT functions on a ‘pay as
you go’ basis. 
Our automated back up (‘VBAK’) and data
replication services assure the integrity and
security of business critical data and
deliver business continuity benefits. The
quality of the technology has been
recognised with our appointment as IBM’s
first “Data Retention Centre of
Competence” in EMEA. As partners in IBM’s
Total Recovery Services framework and
their adoption of VBAK into the IBM
Business Continuity portfolio, InTechnology
is now able to market VBAK in association
with one of the world’s leading providers of
Business continuity services.
VBAK remains one of our core services and
has attracted many high-profile customers
in the past year, including distinguished
public sector organisations such as King’s
College, Birkbeck College and London
Business School in the University of London. 
Our advanced Data Centre technology for
secure data storage services has also been
recognised in a partnership with EMC
Centera for replication and storage of data
such as x-rays, voice archives, electronic
documents and email archives.
Convergence of network technologies
means that customers who currently
subscribe to our increasingly competitive
VPN, Internet access and Broadband
connectivity services have upgraded to
other Managed Services and 60% of these
customers now take at least two services
from us, a trend we confidently expect to
develop further with the introduction of
new layered IP services.
InTechnology Data Centre page 10
InTechnology plc Annual Report and Financial Statements 2005
New services
We have three new additions to our
Managed Services portfolio – our IP Voice
Connect ™ service, a unique pay per usage
Information Lifecycle Management solution
and a VBAK variant for small and medium
sized businesses. 
The IP Voice Connect ™ service enables
organisations to implement reliable IP
telephony at significantly reduced
telecommunication costs and with
unparalleled user functionality. It is a
hosted, managed service which is layered
over InTechnology’s ethernet network.
Customers have the opportunity to
converge their voice and data networks
into one high-performance, scalable and
cost-effective network.
As organisations grapple with the allied
problems of growing data volumes and
compliance with data regulations,
InTechnology has developed the first
commercial pay as you go model for
Information Lifecycle Management,
providing a world-class policy engine and a
flexible set of storage options depending
on the importance of the data and likely
access requirements. 
We have extended the reach of the VBAK
managed backup service, incorporating new
technology that makes it suitable for the
typical data volumes and budgets of small
and medium size businesses.
Effective data management
As our customers seek new ways of
managing their growing data volumes
effectively, we have provided new
technologies to support them. Our core
data storage distribution business has
grown strongly, with notable development
in our partnership with Sun Microsystems.
In the past year, our partnership with
Network Appliance has proved very
successful, with growth in sales from zero
to £15 million marking the ready adoption
in the market of this advanced and
specialised technology, providing
centralised storage flexibly for open
network environments.
InTechnology Data Centre Control Room page 11
InTechnology plc Annual Report and Financial Statements 2005
Software
Working in close partnership with IBM
Software, VERITAS, HP OpenView and KVS
(now part of VERITAS), we have provided a
range of new standalone and integrated
software solutions to help customers
improve efficiency and extract maximum
value from their data.
Success in our software business has been
underpinned by technical expertise in
consultancy, sales and training support – for
example, InTechnology was presented with
the award for UK VERITAS Top Enterprise
Master Reseller for the fourth consecutive
year by growing the licence revenue for
VERITAS software by 82% over 2003.
Security
Continued strong demand for our security
technology has reflected customer focus on
IT security with requirements for reliable
anti-virus, intrusion detection and firewall
solutions.
New solutions have been introduced to the
European security market, through
partnerships with leading IT security
vendors. An exclusive new pan-European
distribution partnership with Network
Engines and Microsoft ® will bring
innovative security appliances into the
European markets in which we trade.
Network Engines NS Series is a family of
security appliances powered by Microsoft
Internet Security and Acceleration Server
2004 (‘ISA’). Specifically designed to defend
Microsoft server assets, these appliances
provide customers with the best available
perimeter and application firewall
protection for critical Microsoft products
and services, including Microsoft Exchange
Server, Internet Information Services (‘IIS’)
and SharePoint® Portal Server. 
Increasing demands from customers for
wireless technology have led to our new
partnership with security specialists Ironport
to distribute the complete Ironport range of
email infrastructure products and services,
including world-class email security and
messaging gateway appliances. 
InTechnology - Software Consultancy page 12
InTechnology plc Annual Report and Financial Statements 2005
Network products
As businesses increasingly adopt IT
networks to support their IT infrastructure,
we have launched a Network Solutions
division, developing and selling secure
networking solutions across Europe. Nortel
and Juniper are our partners in the new
division, adding high-speed data
networking, Ethernet switches and security
products to our portfolio. 
Our current portfolio demonstrates our
capability to understand, design and deliver
networking solutions - the new division
will draw on networking expertise from
both our Security and Managed Services
Divisions. 
The introduction of InTechnology Network
Solutions completes our proposition and
will ensure our Partners are able to address
the continuing convergence of Network,
Security, Voice and Storage infrastructures
as end-users increasingly look to buy a
complete solution from a single source.
InTechnology - Network Solutions page 13
InTechnology plc Annual Report and Financial Statements 2005
Management team
The Rt. Hon Lord Parkinson, 
President (Chairman effective 
21 April 2005) and Senior non-
Executive Director, aged 73
Lord Parkinson was appointed to 
the board in July 2000 as a 
non-Executive Director and is a
member of both the Audit and
Remuneration Committees of the
Group. Lord Parkinson is a Member of
the House of Lords and was a
Member of Parliament from 1970 to
1992, during which time he held a
number of senior ministerial
positions including Secretary of State
for Trade and Industry, Energy and
Transport. He was Chairman of the
Conservative Party from 1981 to
1983 and again from 1997 to 1998.
A qualified chartered accountant,
Lord Parkinson was a Partner in
Westwake Price (City Chartered
Accountants) for 10 years and is
currently Chairman and Director of a
number of companies including
Jarvis Group Limited, Huntswood plc
and Le Carbone UK Group of
Companies.
Charles Scott, 
non-Executive Director, aged 56
Charles Scott joined the board in
April 2001 as a non-Executive-
Director. A chartered accountant,
he is currently Chairman of
William Hill plc and a non-
Executive Director of a number of
other companies including Media
Group plc.
Joe McNally, 
non-Executive Director, aged 62
Joe McNally was appointed to the
Board in December 2000 as a non-
Executive Director. He founded
Compaq UK and Ireland in 1984
and was latterly appointed
Chairman, before retiring in
August 2001. Previously he was
Chief Executive of FMC Harris plc.
Peter Wilkinson, 
Chairman (Chief Executive Officer
effective 21 April 2005), aged 51
Peter Wilkinson founded STORM in
1983 and VData in 1998 and both
these businesses were sold to
InTechnology plc in 2000 (in which
he retains a 56% shareholding).
Peter was appointed to the board of
InTechnology in July 2000.
In 1995, he started Planet Online
Limited, the internet service
provider, which was subsequently
sold to Energis in 1998. He retained
Planetfootball.com which was
reversed into Sports Internet Group
plc in 1999 and subsequently sold to
BskyB plc in 2000.
In 1998, Peter invented the free ISP
model Freeserve, the internet access
service which was launched by the
Dixons Group plc.
In 2002, he formed Digital
Interactive Television Group Limited
(‘DITG’) which was subsequently sold
to YooMedia plc in December 2004.
Additionally, Peter holds an 18%
stake in Mobile Tornado Limited.
Non-Executive Directors Executive Directors page 14
InTechnology plc Annual Report and Financial Statements 2005
Andrew Kaberry,
Finance Director, aged 58
Andrew Kaberry was Finance Director
of both STORM and VData and has
worked with Peter Wilkinson since
1984. Andrew was appointed to the
board of InTechnology in July 2000.
He has significant experience of the
computer industry and was Finance
Director of Planet Online Limited.
Andrew qualified as a chartered
accountant with KPMG in 1972.
Steve Pearce, 
Chief Operating Officer and Business
Development Director, aged 46
Steve Pearce was Divisional Sales
Director for VData and was
previously Divisional Sales Director
for Planet Online Limited and STORM.
He has previous experience with a
number of companies in the
technology sector including Digital
Equipment Corporation Limited, Data
General UK Limited and Radius
Software Limited.
Bryn Sage, 
Sales Director, aged 39
Bryn Sage has spent his career
in the data storage arena
beginning as an Apprentice
Engineer in Systime Computers
in 1981. In 1986, he joined
STORM as an Engineer and
progressed through the
company to the position of
Sales Director in 1994.
Richard James,
Company Secretary, aged 44
Richard James qualified as a solicitor
with Allen & Overy in 1986 and was a
Partner at Pinsent Curtis in 1991, before
moving to Hammonds as a Partner in
1996. After advising Peter Wilkinson on
the acquisition of Planetfootball.com by
Sports Internet Group plc, Richard was
appointed as Managing Director of
Planetfootball.com and Company
Secretary of Sports Internet Group plc.
Richard was appointed to the Board of
InTechnology in September 2000 as a
Director and Company Secretary.
John Swingewood, 
Chief Technical Officer, aged 50
John Swingewood joined the Board
in May 2001 as a Director and Chief
Technical Officer. He was previously
Director of New Media at BskyB plc
and has also held positions at BT plc
as Director of Internet and
Multimedia and General Manager 
of Broadcast TV Business.  page 15
InTechnology plc Annual Report and Financial Statements 2005
Directors’ report
The Directors present their annual report
and audited financial statements of the
Company and the Group for the year
ended 31 March 2005.
Principal activities
InTechnology is a specialist advanced data
technology Group providing services and
products via channel partners for data
storage and deployment, data management,
protection and security through its wide-
area private network infrastructure.
Review of the business and
future developments
Details of the past year’s performance and
the outlook for the current financial year are
provided in the Chairman’s introduction, the
Chief Executive Officer’s report and Financial
review on pages 2 to 8.
Results and dividends
The Directors are unable to recommend the
payment of a dividend in respect of the year
ended 31 March 2005 (2004: £nil). The
Company currently intends to reinvest
future earnings to finance the growth of 
the business.
The loss sustained for the financial year of
£2,575,000 (2004 restated: £4,889,000) will
be deducted from reserves.
Charitable and political
donations
The contributions made by the Group during
the year for charitable purposes totalled
£16,000 (2004: £6,000), comprising
children’s charities £13,000 (2004: £6,000),
muscular dystrophy charities £2,000 (2004:
£nil) and cancer relief charities £1,000 (2004:
£nil). The Group made no political
contributions (2004: £nil).
Directors
The Directors of the Company during the
year ended 31 March 2005, together with
brief biographies, are shown on pages 13
and 14, with the exception of Charles
Cameron who resigned as a director on 21
April 2005.
Re-election of Directors
In accordance with the Articles of
Association of the Company, Directors will
retire by rotation. Accordingly, Peter
Wilkinson, Andrew Kaberry, Richard James
and the Rt. Hon. Lord Parkinson will retire by
rotation and, being eligible, offer themselves
for re-election at the forthcoming AGM.
All Directors must be re-elected at intervals
of not more than three years in accordance
with the provisions of the Combined Code of
Corporate Governance. page 16
InTechnology plc Annual Report and Financial Statements 2005
Directors’ remuneration and
interests
The Remuneration report is set out on pages
22 to 25. It includes details of Directors’
remuneration, interests in the shares of the
Company, share options and pension
arrangements. The Company’s Register of
Directors’ Interests, which is open to
inspection at the Company’s registered
office, contains full details of Directors’
shareholdings and options to subscribe for
shares.
The Board’s Corporate Governance report,
including the Directors’ statement on
responsibilities for the preparation of
financial statements, is set out on pages 
19 to 21.
Details of related party transactions
involving Directors of the Company are
given in note 27 to the financial statements.
Substantial shareholdings
At 29 June 2005, the Company had received
notification that the following are interested
in more than 3 per cent of the issued
ordinary share capital of the Company:
Percentage of 
shares held
Peter Wilkinson 55.6%
Jon Wood 7.5%
Artemis Investment
Management Limited 7.0%
Andrew Kaberry 5.2%
Canada Life 4.1%
Going concern
Under company law, the Directors are
required to consider whether it is
appropriate to prepare financial statements
on the basis that the Company and Group
are going concerns. As part of its normal
business practice, budgets, cash flow
forecasts and longer term financial
projections are prepared and in reviewing
this information, the Directors are satisfied
that the Company and the Group have
adequate resources to enable them to
continue in business for the foreseeable
future. The Directors have therefore adopted
the going concern basis in the preparation
of the financial statements. page 17
InTechnology plc Annual Report and Financial Statements 2005
Employees
The Group places considerable value on the
involvement of its employees and has
continued its practice of keeping them
informed of matters affecting them as
employees and the various factors affecting
the performance of the Group.
The Directors recognise that continued and
sustained improvement in the performance of
the Group depends on its ability to attract,
motivate and retain employees of the highest
calibre. Furthermore, the Directors believe
that the Group’s ability to sustain a
competitive advantage over the long term
depends in a large part on ensuring that all
employees contribute to the maximum of
their potential. The Group is committed to
improving the performance of all employees
through development and training.
The Group is an equal opportunity employer.
The Group’s policies seek to promote an
environment free from discrimination,
harassment and victimisation and to ensure
that no employee or applicant is treated less
favourably on the grounds of gender, marital
status, age, race, colour, nationality or
national origin, disability or sexual
orientation or is disadvantaged by
conditions or requirements, which cannot
objectively be justified. Entry into, and
progression within the Group, is solely
determined on the basis of work criteria and
individual merit.
The Group continues to give full and fair
consideration to applications for
employment made by disabled persons,
having regard to their respective aptitudes
and abilities. The policy includes, where
practicable, the continued employment of
those who may become disabled during
their employment and the provision of
training and career development and
promotion, where appropriate.
Share schemes
Share ownership is at the heart of the
Group’s remuneration philosophy and the
Directors believe that the key to the Group’s
future success lies in a motivated workforce
holding a stake in the Company. The
schemes are described in the Board’s
Remuneration report and details of the
options granted under the schemes are set
out in note 18 to the financial statements.
All permanent employees are eligible to join
the schemes.
Research and development
The Group continues to undertake research
and development of new products with the
objective of increasing future profitability.
The cost to the Group is charged to the
profit and loss account as incurred. page 18
InTechnology plc Annual Report and Financial Statements 2005
Policy and practice on 
payment of creditors
It is the Group’s policy to agree terms and
conditions for its business transactions with
its suppliers. The Group seeks to abide by the
payment terms agreed with suppliers
whenever it is satisfied that the supplier has
provided the goods or services in accordance
with the agreed terms and conditions.
In the year ended 31 March 2005 average
creditor days for the Group and Company
were 31 days (2004: 38 days) and 33 days
(2004: 37 days) respectively.
Environment
The Group recognises the importance of
environmental responsibility. The nature of
its activities has a minimal effect on the
environment but where they do, the Group
acts responsibly and is aware of its
obligations at all times.
Annual General Meeting
The next AGM of the Company will be held
on 9 August 2005. Details of the business to
be proposed at the AGM are contained
within the Notice of Meeting, which is set
out on pages 58 and 59.
Independent auditors
PricewaterhouseCoopers LLP have indicated
their willingness to continue in office and a
resolution proposing that they be
reappointed as independent auditors and
authorising the Directors to fix their
remuneration will be proposed at the Annual
General Meeting.
By order of the Board
Richard James
Company Secretary
29 June 2005
Richard James page 19
InTechnology plc Annual Report and Financial Statements 2005
Corporate governance
InTechnology plc is an AIM listed company
and is not therefore required to comply with
the Principles of Good Governance and Code
of Best Practice, the ‘FRC Combined Code on
Corporate Governance’ issued in 2003. The
following disclosures are made voluntarily.
Principles of Corporate
Governance
The Board recognises the value of good
corporate governance as a positive
contribution to the well being of the
business and believes in applying these
principles, (including those set out in Section
1 of the Combined Code), in a sensible and
pragmatic manner. 
Peter Wilkinson, as majority shareholder in
the Company, has signed an agreement
stating that he will not seek to influence the
Board by reason of his shareholding.
Board of Directors
The Board of Directors consists of nine
members, including a non-Executive
Chairman and two other non-Executive
Directors.
The roles of Chairman and Chief Executive
Officer are separated and clearly defined.
The activities of the Group are controlled by
the Board, which meets throughout the year.
There is a formal schedule of matters
specifically reserved for the full Board’s
decision, together with a policy enabling
Directors to take independent advice in the
furtherance of their duties at the Group’s
expense. The Board programme is designed
so that Directors have regular opportunity to
consider the Group’s strategy, policies,
budgets, progress reports and financial
position and to arrive at a balanced
assessment of the Group’s position and
prospects.
The Board is assisted by the Company
Secretary, who provides a point of reference
and regular support for all Directors and
senior managers. He has responsibility for
ensuring that Board procedures are
followed, for establishing the Group’s
corporate governance policies and for
assisting the Board in facilitating
compliance by the Company with its legal
obligations.
The Board has appointed two standing
committees, which are as follows:
The Audit Committee
Comprises the two non-Executive Directors
and the non-Executive Chairman and is
chaired by Lord Parkinson. Its duties include
a comprehensive review of the annual and
interim financial statements before they are
presented to the Board for approval. The
Audit Committee meets at least twice a year
to review the findings of the external
auditors, key accounting policies and
judgements. It has unrestricted access to the
Company’s auditors.
The Remuneration Committee
Comprises the two non-Executive Directors
and the non-Executive Chairman and is
chaired by Joe McNally. It meets at least
once a year and is responsible for making
recommendations to the Board on
remuneration policy for Executive Directors
and for setting salaries, incentive payments
and share options granted. page 20
InTechnology plc Annual Report and Financial Statements 2005
Relations with shareholders
The Company seeks to ensure that all
shareholders are kept informed about the
Company and its activities. A comprehensive
annual report and accounts and an interim
report are sent to shareholders and there is
frequent dialogue with institutional
investors, including presentations following
the preliminary and interim announcements.
The Annual General Meeting is a forum for
shareholders’ participation with the
opportunity to meet and question Board
members including the non-Executive
Chairman and the Chairmen of the Board
committees.
Internal control
The Board of Directors acknowledges its
overall responsibility for the Company’s
systems of internal control and for monitoring
their effectiveness. The Board has control over
strategic, financial and compliance issues and
has introduced a structure of responsibility
with appropriate levels of authority. The Board
as a whole has continued to review the
effectiveness of the Company’s systems of
internal control annually.
The Company’s Directors and varying levels
of management have clear responsibilities in
ensuring that the control environment
operates efficiently. Clear lines of
responsibility are developed through the
Company’s organisation structure. Ethical
policies are communicated through all forms
of personnel training and via appropriate
procedures, in establishing a code of ethics.
Although no system of internal control can
provide absolute assurance against material
misstatement or loss, the Company’s
systems are designed to provide reasonable
assurance that problems are identified on a
timely basis and are dealt with appropriately.
The principal features of the Company’s
internal financial control structures can be
summarised as follows:
a. Preparation of budgets and forecasts
approved by the Board.
b. Monthly management accounts,
showing comparisons of actual results
against budget and prior year results,
are reviewed by the Board. Variances
from budget are thoroughly
investigated and discussed at monthly
Board meetings. Where lapses in
internal control are detected, these are
rectified.
c. The Company’s cash flow is also
monitored monthly compared to
forecast.
d. The Board authorises capital
expenditure where this is significant.
The Board has continued to enhance its risk
control programme, in particular, those
elements which relate to ensuring that risk
reviews are formally embedded in control
systems rather than being the subject of
formal annual reviews. page 21
InTechnology plc Annual Report and Financial Statements 2005
Statement of Directors’
responsibilities
Company law requires the Directors to
prepare financial statements for each
financial year that give a true and fair view
of the state of affairs of the Company and
the Group as at the end of the financial year
and of the profit or loss of the Group for
that year.
The Directors confirm that suitable
accounting policies have been used and
applied consistently as explained on pages
32 and 33 under the heading ‘Accounting
policies’ with the exception of the change in
accounting policy relating to income
recognition on pages 32 and 33. They also
confirm that reasonable and prudent
judgements and estimates have been made
in preparing the financial statements for the
year ended 31 March 2005, that applicable
accounting policies have been followed and
that the financial statements have been
prepared on the going concern basis.
The Directors are responsible for keeping
proper accounting records that disclose with
reasonable accuracy at any time the
financial position of the Company and the
Group and to enable them to ensure that
the financial statements comply with the
Companies Act 1985. They are also
responsible for safeguarding the assets of
the Company and the Group and hence for
taking reasonable steps for the prevention
and detection of fraud and other
irregularities.
The maintenance and integrity of the
InTechnology website is the responsibility of
the Directors; the work carried out by the
auditors does not involve consideration of
these matters and, accordingly, the auditors
accept no responsibility for any changes
that may have occurred to the financial
statements since they were initially
presented on the website.
Legislation in the United Kingdom governing
the preparation and dissemination of
financial statements may differ from
legislation in other jurisdictions.
By order of the Board
Richard James
Company Secretary 
29 June 2005 Remuneration report
page 22
InTechnology plc Annual Report and Financial Statements 2005
As an AIM listed company InTechnology plc
is not required to comply with Schedule 7A
of the Companies Act 1985. The following
disclosures are made voluntarily. The
contents of this report are unaudited unless
clearly identified as audited.
The Remuneration Committee comprises the
non-Executive Directors:
Joe McNally (Chairman)
The Rt. Hon. Lord Parkinson
Charles Scott
Directors’ remuneration
Remuneration of non-Executive Directors
The remuneration of the non-Executive
Directors is determined by the Board, with
the assistance of independent advice
concerning comparable organisations and
appointments. The non-Executive Directors
do not take part in discussions on their
remuneration.
Neither the non-Executive Chairman nor the
other non-Executive Directors received any
pension or other benefits from the Group,
nor did they participate in any of the bonus
schemes.
The non-Executive Chairman and Directors
have interests in share options as disclosed
on page 25.
Remuneration of Executive Directors
The main aim of the Company’s Executive
pay policy is to secure the skills and
experience needed to meet its strategic
business objectives. Furthermore, the
Company aims to align the interests of all
employees as closely as possible with the
interests of shareholders through share-
based incentives.
The Company’s Remuneration Committee
decides the remuneration policy that applies
to Executive Directors. In setting the policy it
considers a number of factors including:
(a) The basic salaries and benefits available
to Executive Directors of comparable
companies.
(b) The need to attract and retain Directors
of an appropriate calibre.
(c) The need to ensure Executive Directors’
commitment to the continued success
of the Group by means of incentive
schemes.
The Company’s remuneration policy is to:
(a) Have regard to the Directors’ experience
and the nature and complexity of their
work in order to pay a competitive
salary that attracts and retains
management of the highest quality.
(b) Link individual remuneration packages
to the Group’s long term performance
through the award of share options
and incentive schemes.
(c) Provide post retirement benefits
through defined contribution pension
schemes.
(d) Provide employment-related benefits
including the provision of a company
car, (or car allowance), fuel, medical
and life insurance and insurance
relating to the Directors’ duties. page 23
InTechnology plc Annual Report and Financial Statements 2005
Salaries
The Remuneration Committee meets at least
once a year in order to consider and set the
annual salaries for Executive Directors,
having regard to the needs of the Company,
individual responsibilities, personal
performance and independently compiled
salary survey information.
Pensions (audited)
The Executive Directors are members of
defined contribution pension schemes, the
assets of which are held independently of
the Company. The amounts contributed by
the Company (based on salaries excluding
bonuses) for the year ended 31 March 2005
were £60,000 (2004: £57,000). The Company
does not provide any other post-retirement
benefits to the Directors.
Contracts of service
The Executive Directors have contracts of
service that can be terminated by the
Company with the following notice periods:
Peter Wilkinson 12 months
Andrew Kaberry 6 months
Richard James 12 months
Steve Pearce 6 months
Bryn Sage 6 months
John Swingewood 12 months
With the exception of the contracts with
Richard James and John Swingewood, if the
Company terminates the contract by notice
but other than on giving full notice, the
contracts of service provide for the payment
of a fixed amount equal to the salary and
other contractual benefits for the unexpired
portion of the appointment or entitlement
to notice, as the case may be.
Non-Executive Directorships
The Remuneration Committee believes that
the Group can benefit from Executive
Directors accepting appointments as non-
Executive directors of other companies. The
Director concerned may retain any fees
related to such employment. page 24
InTechnology plc Annual Report and Financial Statements 2005
Directors’ emoluments (audited)
The remuneration of the Directors of the Company was as follows:
2005 2004
Salary Bonus Benefits Pension Total Total
in kind contributions
£’000 £’000 £’000 £’000 £’000 £’000
Executive Directors
Peter Wilkinson 212 - 36 2 250 252
John Swingewood 162 - 1 8 171 221
Charles Cameron 187 - 4 25 216 214
Bryn Sage 110 76 15 5 206 201
Andrew Kaberry 150 - 27 12 189 190
Richard James 162 12 5 - 179 166
Steve Pearce 150 20 22 8 200 157
1,133 108 110 60 1,411 1,401
Fees Bonus Benefits Pension Total Total
in kind contributions
£’000 £’000 £’000 £’000 £’000 £’000
Non-Executive Directors
The Rt. Hon. Lord Parkinson 50 -- - 50 49
Joe McNally 30 - - - 30 25
Charles Scott 30 -- - 30 25
110 -- - 110 99
Total 1,243 108 110 60 1,521 1,500
Benefits in kind include the provision of a company car, fuel, medical, life insurance and insurance relating to the
Directors’ duties.
Directors’ interests
Interests in shares
The interests of the Directors in the shares of the Company as at 31 March were:
2005 2004
Number Percentage Number Percentage
of shares of shares
held held
Peter Wilkinson 78,403,998 55.6% 78,403,998 56.6%
Andrew Kaberry 7,379,562 5.2% 9,879,562 7.1%
Steve Pearce 3,939,781 2.8% 4,939,781 3.6%
John Swingewood 1,000,000 0.7% 1,000,000 0.7%
90,723,341 64.3% 94,223,341 68.0%
Apart from the interests disclosed above and the interests in share options disclosed below, none of the other Directors of
the Company at 31 March 2005 held interests at any time in the year in the share capital of the Company or other Group
companies.
There have been no other changes in Directors’ shareholdings since 31 March 2005. page 25
InTechnology plc Annual Report and Financial Statements 2005
Interests in share options (audited)
The following share schemes were in place at the year end:
Rolled over HOLF granted 23/12/99 at 43.3 pence per share
Rolled over VData granted 7/01/00 at 1.8 pence per share
Options granted directly by InTechnology plc at varying dates and prices.
Further details are provided in note 18.
Set out below are details of share options that have been granted to Executive and non-Executive Directors:
Executive Directors No. of No. of Exercise Earliest Expiry
share share price exercise date
options options (p) date
2005 2004
Richard James 400,000 400,000 150.0 01/09/03 01/04/11
Richard James 400,000 400,000 52.0 04/07/05 04/07/12
Andrew Kaberry 1,596,399 1,596,399 43.3 23/12/02 23/12/09
Bryn Sage 798,200 798,200 43.3 23/12/02 23/12/09
Bryn Sage 443,769 443,769 1.8 07/01/03 07/01/10
John Swingewood 500,000 500,000 279.0 01/05/04 01/05/11
John Swingewood 500,000 500,000 65.0 11/06/05 11/06/12
Charles Cameron 750,000 750,000 52.0 04/07/05 04/07/12
Non-Executive Directors
Lord Parkinson 221,885 221,885 1.8 07/01/03 07/01/10
Lord Parkinson 203,178 203,178 43.3 23/12/02 23/12/09
Joe McNally 50,000 50,000 337.5 01/11/03 01/11/10
Charles Scott 50,000 50,000 327.5 02/01/04 02/01/11
No share options have been granted or exercised nor have lapsed in the year.
No Directors have been granted or exercised share options since 31 March 2005.
The market price of the Company’s shares at 31 March 2005 was 49.4p (2004: 82.0p) and the range during the year then
ended was 94.8p to 48.0p.
Joe McNally
Non-Executive Director
29 June 2005 Independent auditors’ report to the 
members of InTechnology plc
page 26
InTechnology plc Annual Report and Financial Statements 2005
For the year ended
31 March 2005
We have audited the financial statements
which comprise the consolidated profit
and loss account, consolidated statement
of total recognised gains and losses,
reconciliation of movements in Group
shareholders’ funds, balance sheets,
consolidated cash flow statement,
accounting policies and the related notes.
Respective responsibilities of
Directors and auditors
The Directors’ responsibilities for
preparing the annual report and the
financial statements in accordance with
applicable United Kingdom law and
accounting standards are set out in the
statement of Directors’ responsibilities.
Our responsibility is to audit the financial
statements in accordance with the
relevant legal and regulatory
requirements and United Kingdom
Auditing Standards issued by the Auditing
Practices Board. This report, including the
opinion, has been prepared for and only
for the Company’s members as a body in
accordance with Section 235 of the
Companies Act 1985 and for no other
purpose. We do not, in giving this
opinion, accept or assume responsibility
for any other purpose or to any other
person to whom this report is shown or
into whose hands it may come save
where expressly agreed by our prior
consent in writing.
We report to you our opinion as to
whether the financial statements give a
true and fair view and are properly
prepared in accordance with the
Companies Act 1985. We also report 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
is not disclosed.
We read the other information contained
in the Annual Report and consider the
implications for our report if we become
aware of any apparent misstatements or
material inconsistencies with the financial
statements. The other information
comprises only the Chairman’s
introduction, Chief Executive Officer’s
report, the Financial review, the
Technology review, the Management
Team, the Directors’ Report, the Corporate
Governance report and the Remuneration
report.
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. 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
Company’s circumstances, consistently
applied and adequately disclosed.
We planned and performed our audit so
as to obtain all the information and
explanations which we considered
necessary in order to provide us with
sufficient evidence to give reasonable
assurance that the financial statements
are free from material misstatement,
whether caused by fraud or other
irregularity or error. In forming our
opinion we also evaluated the overall
adequacy of the presentation of
information in the financial statements.
Opinion
In our opinion the financial statements
give a true and fair view of the state of
affairs of the Company and the Group as
at 31 March 2005 and of the loss and
cash flows of the Group for the year then
ended and have been properly prepared in
accordance with the Companies Act 1985.
PricewaterhouseCoopers LLP
Chartered Accountants and 
Registered Auditors
Leeds
29 June 2005 page 27
Consolidated profit and loss account
For the year ended 31 March 2005
2005 2004
(Restated)
Note £’000 £’000
Turnover
Continuing operations 282,262 221,868
Acquisition 1,260 -
1, 2 283,522 221,868
Cost of sales (230,579) (181,331)
Gross profit 2 52,943 40,537
Net operating expenses before depreciation and amortisation of goodwill (42,204) (33,524)
Depreciation (6,388) (5,640)
Amortisation of goodwill (4,635) (4,403)
Net operating expenses (53,227) (43,567)
Group operating (loss) / profit
Continuing operations (551) (3,030)
Acquisition 267 -
Group operating loss 1 (284) (3,030)
Net interest payable 3 (2,181) (1,050)
Loss on ordinary activities before taxation 4 (2,465) (4,080)
Tax on loss on ordinary activities 2, 5 (110) (809)
Loss sustained for the financial year 2, 19 (2,575) (4,889)
EBITA 4,351 1,373
Loss per share (pence)
Basic and diluted 7 (1.84) (3.54)
Adjusted earnings / (loss) per share (pence)
Basic and diluted 7 1.48 (0.35)
EBITA comprises earnings before interest, taxation and amortisation of goodwill.
There is no difference between the loss on ordinary activities before taxation and the loss sustained for the financial year
and their historical cost equivalents.
InTechnology plc Annual Report and Financial Statements 2005 page 28
Consolidated statement of 
total recognised gains and losses
For the year ended 31 March 2005
2005 2004
(Restated)
Note £’000 £’000
Loss sustained for the financial year (2,575) (4,889)
Unrealised gain on revaluation of land & buildings 9 1,754 -
Exchange gain / (loss) on translation of overseas subsidiaries 19 172 (301)
Exchange (loss) / gain on translation of hedging loan 19 (172) 301
Total recognised gains and losses relating to the year (821) (4,889)
Prior year adjustment 2 (753) -
Total recognised gains and losses since last annual report (1,574) (4,889)
InTechnology plc Annual Report and Financial Statements 2005 page 29
Reconciliation of movements in
Group shareholders’ funds
For the year ended 31 March 2005
2005 2004
(Restated)
Note £’000 £’000
Loss sustained for the financial year (2,575) (4,889)
Unrealised gain on revaluation of land & buildings 9 1,754 -
Proceeds of ordinary share capital issued 18 27 3
Premium on ordinary share capital issued 18 248 29
Exchange gain / (loss) on translation of overseas subsidiaries 19 172 (301)
Exchange (loss) / gain on translation of hedging loan 19 (172) 301
Net change in shareholders’ funds (546) (4,857)
Opening shareholders’ funds 2, 19 92,023 96,880
Closing shareholders’ funds 19 91,477 92,023
InTechnology plc Annual Report and Financial Statements 2005 page 30
Balance sheets
As at 31 March 2005
InTechnology plc Annual Report and Financial Statements 2005
Group Company
2005 2004 2005 2004
(Restated) (Restated)
Note £’000 £’000 £’000 £’000
Fixed assets
Intangible assets 8 74,813 76,910 70,568 73,085
Tangible assets 9 14,773 13,443 13,795 12,848
Investments in subsidiary undertakings 10 - - 19,180 18,354
89,586 90,353 103,543 104,287
Current assets
Stocks 11 13,179 10,811 12,597 10,383
Debtors - due after more than one year 12 - - 1,455 1,455
- due within one year 12 105,399 91,265 82,286 72,770
105,399 91,265 83,741 74,225
Cash at bank and in hand 10,488 16,379 9,473 14,962
129,066 118,455 105,811 99,570
Creditors - amounts falling due within one year 13 (118,174) (98,395) (100,166) (84,948)
Net current assets 10,892 20,060 5,645 14,622
Total assets less current liabilities 100,478 110,413 109,188 118,909
Creditors - amounts falling due 
after more than one year 14 (9,001) (18,246) (17,511) (26,729)
Provisions for liabilities and charges 17 - (144) - (144)
Net assets 1 91,477 92,023 91,677 92,036
Capital and reserves
Called up share capital - equity 18 & 19 1,411 1,384 1,411 1,384
- non-equity 18 & 19 480 480 480 480
Share premium account 19 188,668 188,420 188,668 188,420
Revaluation reserve 19 1,754 - 1,754 -
Profit and loss account 19 (100,836) (98,261) (100,636) (98,248)
Shareholders’ funds
(including non-equity interests) 19 91,477 92,023 91,677 92,036
Shareholders’ funds comprise:
Equity interests 89,237 89,783 89,437 89,796
Non-equity interests 2,240 2,240 2,240 2,240
91,477 92,023 91,677 92,036
The financial statements on pages 27 to 57 were approved by the Board of Directors on 29 June 2005 and were signed on
its behalf by:
Andrew Kaberry
Finance Director page 31
Consolidated cash flow statement
For the year ended 31 March 2005
2005 2004
Note £’000 £’000
Net cash (outflow) / inflow from operating activities 21 (2,000) 3,485
Returns on investments and servicing of finance
Interest received 160 324
Interest element of finance lease payments (282) (220)
Interest paid (2,033) (1,104)
Debt issue costs - (300)
Net cash outflow from returns on investments and servicing of finance (2,155) (1,300)
Taxation paid (1,135) (1,305)
Capital expenditure and financial investment
Purchase of tangible fixed assets (6,106) (4,010)
Sale of tangible fixed assets 1,542 349
Net cash outflow from capital expenditure and financial investment (4,564) (3,661)
Acquisitions
Purchase of subsidiary undertakings (including costs) 20 (980) (18,578)
Net cash at bank acquired with purchase of subsidiary undertakings 20 - 2,731
Net cash outflow for acquisitions (980) (15,847)
Net cash outflow before financing (10,834) (18,628)
Financing
Issue of ordinary share capital 275 32
Net increase in borrowings 6,615 18,090
Capital element of finance lease payments (1,991) (1,173)
Net cash inflow from financing 4,899 16,949
Decrease in cash in the year 22 & 23 (5,935) (1,679)
InTechnology plc Annual Report and Financial Statements 2005 page 32
Accounting policies
The financial statements have been prepared in accordance with the Companies Act 1985 and applicable Accounting
Standards in the United Kingdom. A summary of the main accounting policies which have been applied consistently
(except in respect of revenue recognition, see below for further details) is set out as follows:
Basis of accounting
The financial statements have been prepared in accordance with the historical cost convention modified to include the
revaluation of certain fixed assets.
Basis of consolidation
The consolidated profit and loss account and balance sheet include the financial statements of the company and its
subsidiary undertakings up to 31 March. The results of subsidiaries acquired are included in the consolidated profit and
loss account from the date on which control passes. Intra-group sales and profits are eliminated fully on consolidation.
On acquisition of a subsidiary, its assets and liabilities that exist at the date of acquisition are recorded at their fair values.
All gains and losses that arise after the group has gained control of the subsidiary are included in the post acquisition
profit and loss account.
Goodwill
Goodwill arising on consolidation represents the excess of the fair value of the consideration paid over the fair value of
the identifiable net assets acquired and is amortised through the profit and loss account over its useful economic life. The
Directors have assessed the estimated useful economic life of goodwill at 20 years from date of acquisition based on the
strengths of the underlying businesses and projected future market growth. The Directors review the level of goodwill for
impairment at the end of the first full financial year following acquisition and in other periods if events or changes in
circumstances indicate that the carrying value may not be recoverable.
Tangible fixed assets
The cost of tangible fixed assets is their purchase cost with the exception of freehold land & buildings (which are held at
valuation), together with any incidental expenses of acquisition.
Depreciation is calculated so as to write-off the cost of tangible fixed assets less their estimated residual values, on a
straight line basis over the expected useful economic lives of the assets concerned. The principal annual rates used for this
purpose are:
Freehold buildings 2%
Leasehold improvements 20%
Office fixtures and fittings 10% to 50%
Vehicles and computer equipment 20% to 50%
Freehold land is not depreciated.
Surpluses arising on the revaluation of tangible fixed assets are credited to a revaluation reserve. On subsequent disposal
of a revaluated asset, the revaluation surplus relating to this asset is transferred to the profit and loss account reserve.
The Directors review tangible fixed assets for impairment if events or changes in circumstances indicate that the carrying
value may not be recoverable.
Investments
Investments in subsidiary undertakings are stated at cost less any provision for impairment.
Stocks
Stocks are stated at the lower of cost and net realisable value. Provisions are made for obsolete, slow-moving and
defective items where appropriate.
Revenue recognition
Previously the Group recognised revenue on the outright sale of equipment and software on invoice at the time of
despatch. In the light of guidance provided by Application Note G, an amendment to FRS 5, the Group has amended its
accounting policy. The Group now only recognises revenue on the sale of equipment when the goods are received by the 
InTechnology plc Annual Report and Financial Statements 2005 page 33
Accounting policies (continued)
customer and when there are no unfulfilled obligations that affect the customer’s final acceptance of the equipment. The
adoption of this revised accounting policy has resulted in a prior year adjustment, further details of which are provided in
note 2.
Service revenues are recognised over the period to which the service relates.
Unrecognised service revenue and associated cost of sale is included as deferred income and deferred cost respectively in
the balance sheet.
Foreign currencies
Transactions in foreign currencies are recorded at the rate of exchange ruling at the date of the transaction. Monetary
assets and liabilities denominated in foreign currencies are translated to sterling at the exchange rates ruling at the
balance sheet date.
The results of overseas subsidiary undertakings are translated at the average exchange rate for the year. The assets and
liabilities of such undertakings are translated at year end exchange rates. Any resulting exchange differences are taken to
reserves and are reported in the statement of total recognised gains and losses. Exchange differences arising on
borrowings in foreign currency financing overseas investments are taken to reserves to the extent they offset exchange
differences in the investment.
All other exchange differences are taken to the profit and loss account.
Lease agreements
Finance lease arrangements, which transfer to the Group substantially all the benefits and risks of ownership of an asset,
are treated as if the asset had been purchased outright. The assets are included in fixed assets and the capital element of
the finance leases is shown as obligations under finance leases. The finance lease rentals are treated as consisting of
capital and interest elements. The capital element is applied to reduce the outstanding obligations and the interest element
is charged to the profit and loss account in proportion to the reducing capital element outstanding. Assets held under
finance leases are depreciated over the shorter of the lease term and the useful lives of equivalent owned assets.
Costs in respect of operating leases are charged to the profit and loss account on a straight line basis over the term of the lease.
Deferred taxation
Full provision is made for deferred taxation resulting from timing differences between profits computed for taxation
purposes and profits stated in the financial statements to the extent that there is an obligation to pay more tax or right to
pay less tax, in the future as a result of the reversal of those timing differences. Deferred tax is not provided where a
timing difference arises from the revaluation of fixed assets for which there is no binding agreement to sell.
Deferred tax assets are recognised to the extent that they are considered more likely than not to be recoverable in the
foreseeable future. Deferred tax assets and liabilities are not discounted.
Research and development
Research and development expenditure is written off to the profit and loss account as incurred.
Pension costs
The Company operates a defined contribution pension scheme for employees and directors. The assets of the scheme are
held separately from those of the Company. The annual contributions payable are charged to the profit and loss account.
The Company provides no other post-retirement benefits to its employees and directors.
Share schemes
The Group grants share options to employees and directors on a discretionary basis. The scheme is ‘unapproved’ and all
employees have agreed in writing to accept liability for any National Insurance contributions that become due on exercise
of options.
Debt issue costs
Debt issue costs are capitalised and offset against the loans to which they relate. The costs are amortised over the term of
the loan.
InTechnology plc Annual Report and Financial Statements 2005 page 34
Notes to the financial statements
For the year ended 31 March 2005
1 Segmental information
Turnover Turnover Group operating
by destination by source (loss) / profit
by source
2005 2004 2005 2004 2005 2004
(Restated) (Restated) (Restated)
£’000 £’000 £’000 £’000 £’000 £’000
Geographical analysis
United Kingdom 217,761 184,093 220,339 185,294 (403) (3,787)
Continental Europe 64,970 37,174 63,183 36,574 119 757
North America 207 293 - - - -
Africa 68 176 - - - -
Rest of the World 516 132 - - - -
Total 283,522 221,868 283,522 221,868 (284) (3,030)
Turnover Group operating profit / (loss)
Before goodwill After goodwill
amortisation amortisation
2005 2004 2005 2004 2005 2004
(Restated) (Restated) (Restated)
£’000 £’000 £’000 £’000 £’000 £’000
Business analysis
Specialist Distribution 261,449 207,374 6,321 9,131 3,967 7,015
Managed Services 22,073 14,494 (1,970) (7,758) (4,251) (10,045)
Total 283,522 221,868 4,351 1,373 (284) (3,030)
Net assets Including Excluding
goodwill goodwill
2005 2004 2005 2004
(Restated) (Restated)
£’000 £’000 £’000 £’000
Geographical analysis
United Kingdom 78,586 79,797 9,031 7,752
Continental Europe 12,891 12,226 7,633 7,361
Group Total 91,477 92,023 16,664 15,113
Business analysis
Specialist Distribution 55,926 38,479 16,067 (1,196)
Managed Services 25,063 37,165 (9,891) (70)
80,989 75,644 6,176 (1,266)
Cash 10,488 16,379 10,488 16,379
Group Total 91,477 92,023 16,664 15,113
InTechnology plc Annual Report and Financial Statements 2005 page 35
Notes to the financial statements (continued)
1 Segmental information (continued)
The acquisition of the trade and assets of NetConnect Training (included in the above tables) contributed £1,260,000 of
turnover, £305,000 of operating profit before goodwill amortisation and £267,000 of operating profit after goodwill
amortisation to the Specialist Distribution division in the period following completion of the acquisition on 18 June 2004.
The net operating cash inflows have not been disclosed since they were not significant.
The segmental analysis above excludes net interest payable of £2,181,000 (2004: £1,050,000) which is not analysed by
business segment.
2 Prior year adjustment
During the year, the Group has completed a comprehensive review of its accounting policy for revenue recognition in light
of the guidance provided by Application Note G, an amendment to FRS 5. The review identified instances where sales of
equipment have been recognised before the Group has fulfilled all of its contractual obligations to the customer. As a
result, the Group has amended its procedures such that it now only recognises revenue on the sale of equipment when
the goods are received by the customer and when there are no unfulfilled obligations that affect the customer’s final
acceptance of the equipment. Previously, revenue was recognised on shipment of equipment to the customer.
The cumulative effect of the changes relating to previous years has been recognised in the results as a prior year
adjustment and comparative figures have been restated in accordance with the revised accounting policy. The effects of
the changes on turnover, cost of sales, gross margin and the tax charge for the year ended 31 March 2004 are summarised
as follows:
Turnover Cost of Gross Tax
sales margin charge
£’000 £’000 £’000 £’000
Year ended 31 March 2004
As previously stated 223,509 (182,706) 40,803 (889)
Restated 221,868 (181,331) 40,537 (809)
The net effect of the change in policy in the year ended 31 March 2004 is to reduce turnover by £1,641,000, reduce gross
margin by £266,000, reduce the tax charged on loss on ordinary activities by £80,000 and increase the loss sustained for
the financial year by £186,000.
The net effect of the change in policy in the year ended 31 March 2005 is to increase turnover by £3,823,000, increase
gross margin by £535,000, increase the tax charged on loss on ordinary activities by £160,700 and reduce the loss
sustained for the financial year by £374,300.
The cumulative effect of implementing the revised policy is to reduce Group reserves at 31 March 2004 by £753,000,
summarised as follows:
Trade Trade creditors - Net
debtors amounts falling due assets
within 1 year
£’000 £’000 £’000
Year ended 31 March 2004
As previously stated 83,273 (89,650) 92,776
Restated 90,942 (98,072) 92,023
Difference (7,669) 8,422 753
InTechnology plc Annual Report and Financial Statements 2005 page 36
3 Net interest payable
2005 2004
£’000 £’000
Interest payable on bank loans and overdrafts (42) (9)
Interest payable on other loans (1,942) (1,095)
Amortisation of debt issue costs (75) (50)
Interest payable on finance leases (282) (220)
(2,341) (1,374)
Bank interest receivable 160 324
Net interest payable (2,181) (1,050)
4 Loss on ordinary activities before taxation
2005 2004
£’000 £’000
Loss on ordinary activities before taxation is stated after charging / (crediting):
Staff costs (note 25) 24,471 20,301
Depreciation of owned tangible fixed assets 4,302 4,098
Depreciation of leased tangible fixed assets 2,086 1,542
Amortisation of goodwill 4,635 4,403
Other operating lease rentals 3,823 2,722
Auditors’ remuneration - audit 175 150
Auditors’ remuneration - further assurance services - 10
Auditors’ remunerations - tax compliance 48 21
Net exchange gain / (loss) on foreign currency borrowings 14 (14)
Profit on disposal of tangible fixed assets (262) (87)
Auditors’ remuneration includes £49,000 (2004: £53,000) in respect of audit services, £nil in respect of further assurance
services (2004: £10,000) and £22,000 (2004: £21,000) in respect of tax compliance services provided to the Company.
InTechnology plc Annual Report and Financial Statements 2005 page 37
Notes to the financial statements (continued)
5 Tax on loss on ordinary activities
2005 2004
(Restated)
£’000 £’000
Tax charge comprises:
United Kingdom corporation tax at 30% (2004: 30%)
Current (952) (632)
Prior year adjustment (note 2) - 80
Over provision in respect of prior years 265 198
UK current tax (687) (354)
Overseas current tax (337) (430)
Overseas over provision in respect of prior years 19 -
Total current tax (1,005) (784)
Deferred tax current year (note 16) 256 (25)
Deferred tax in respect of prior years (note 16) 639 -
(110) (809)
The tax charge is higher (2004: higher) than the standard rate of corporation tax in the UK. The differences are explained
as follows:
2005 2004
(Restated)
£’000 £’000
Loss on ordinary activities before taxation (2,465) (4,080)
At standard rate of corporation tax of 30% (2004: 30%) (740) (1,224)
Effects of:
Amortisation of goodwill 1,391 1,321
Expenses not deductible for tax purposes 171 366
Adjustment to tax charge in respect of previous periods (284) (198)
Capital allowances for year lower than depreciation 255 161
Overseas tax rates / losses not used 100 251
Other timing differences 112 107
1,005 784
At 31 March 2005, the Company had accumulated tax losses of £2,973,000 (2004: £2,973,000) which are available for
offset against future trading profits of certain Group operations, subject to agreement with the relevant tax authorities.
InTechnology plc Annual Report and Financial Statements 2005 page 38
6 Loss of the holding company
As permitted by section 230 of the Companies Act 1985, the profit and loss account of the Company is not presented in
these financial statements. The parent Company’s loss for the year ended 31 March 2005 was £2,388,000 (2004 restated:
£5,150,000).
7 Loss per share
Basic loss per share is calculated by dividing the loss attributable to ordinary shareholders of £2,575,000 (2004 restated:
£4,889,000) by the weighted average number of ordinary shares in issue during the year of 139,575,879 (2004:
138,245,916).
The adjusted basic loss per share has been calculated to provide a better understanding of the underlying performance of
the Group as follows:
2005 2004
Basic and diluted Basic and diluted
(Loss) / (Loss) / (Loss) / (Loss) /
earnings earnings earnings earnings
per share per share
(Restated) (Restated)
£’000 pence £’000 pence
Loss attributable to ordinary shareholders (2,575) (1.84) (4,889) (3.54)
Amortisation of goodwill 4,635 3.32 4,403 3.19
Adjusted basic earnings / (loss) per share 2,060 1.48 (486) (0.35)
The loss attributable to ordinary shareholders and the weighted average number of ordinary shares for the purpose of
calculating the diluted earnings per ordinary share are identical to those used for basic earnings per ordinary share. This is
because the exercise of share options would have the effect of reducing the loss per ordinary share and is therefore not
dilutive under the terms of FRS 14 “Earnings per share” .
InTechnology plc Annual Report and Financial Statements 2005 page 39
Notes to the financial statements (continued)
8 Intangible fixed assets
Group Goodwill
£’000
Cost
At 1 April 2004 172,257
Additions (note 20) 956
Increase in estimated contingent consideration (i) 1,582
At 31 March 2005 174,795
Amortisation
At 1 April 2004 95,347
Charge for the year 4,635
At 31 March 2005 99,982
Net book amount at 31 March 2005 74,813
Net book amount at 31 March 2004 76,910
Company Goodwill
£’000
Cost
At 1 April 2004 166,613
Additions (note 20) 956
Increase in estimated contingent consideration (ii) 949
At 31 March 2005 168,518
Amortisation
At 1 April 2004 93,528
Charge for the year 4,422
At 31 March 2005 97,950
Net book amount at 31 March 2005 70,568
Net book amount at 31 March 2004 73,085
(i) The increase in contingent consideration is in respect of the acquisition of the Allasso group of companies on 31 July
2003. Based on current trading the Directors estimate that an additional €2,300,000 (£1,582,000 assuming an exchange
rate of £1 to €1.454) contingent consideration will become payable by 31 July 2005.
(ii) The increase in contingent consideration is in respect of the acquisition of the Allasso group of companies on 31 July
2003 and subsequent transfer of the trade and net assets of Allasso Limited to InTechnology plc on 1 November 2003.
Based on current trading the Directors estimate that an additional €1,380,000 (£949,000 assuming an exchange rate of £1
to €1.454) contingent consideration will become payable by 31 July 2005.
InTechnology plc Annual Report and Financial Statements 2005 page 40
9 Tangible fixed assets
Group Freehold Leasehold Office Vehicles & Total
land & improve- fixtures & computer
buildings ments fittings equipment
£’000 £’000 £’000 £’000 £’000
Cost or valuation
At 1 April 2004 3,607 1,600 1,955 22,841 30,003
Acquisitions - - 9 38 47
Additions 42 139 539 6,456 7,176
Disposals (893) - (160) (671) (1,724)
Gain on revaluation 1,094 - - - 1,094
Exchange adjustments - - 11 37 48
At 31 March 2005 3,850 1,739 2,354 28,701 36,644
Accumulated depreciation
At 1 April 2004 501 951 1,422 13,686 16,560
Charge for the year 159 285 302 5,642 6,388
Disposals - - (76) (368) (444)
Gain on revaluation (660) - - - (660)
Exchange adjustments - - 3 24 27
At 31 March 2005 - 1,236 1,651 18,984 21,871
Net book amount at 31 March 2005 3,850 503 703 9,717 14,773
Net book amount at 31 March 2004 3,106 649 533 9,155 13,443
InTechnology plc Annual Report and Financial Statements 2005 page 41
Notes to the financial statements (continued)
9 Tangible fixed assets (continued)
Company Freehold Leasehold Office Vehicles & Total
land & improve- fixtures & computer
buildings ments fittings equipment
£’000 £’000 £’000 £’000 £’000
Cost or valuation
At 1 April 2004 3,607 1,600 1,694 21,317 28,218
Acquisitions - - 9 38 47
Additions 42 139 23 6,139 6,343
Disposals (893) - - (434) (1,327)
Gain on revaluation 1,094 - - - 1,094
At 31 March 2005 3,850 1,739 1,726 27,060 34,375
Accumulated depreciation
At 1 April 2004 501 951 1,305 12,613 15,370
Charge for the year 159 285 253 5,359 6,056
Disposals - - - (186) (186)
Gain on revaluation (660) - - - (660)
At 31 March 2005 - 1,236 1,558 17,786 20,580
Net book amount at 31 March 2005 3,850 503 168 9,274 13,795
Net book amount at 31 March 2004 3,106 649 389 8,704 12,848
The net book amount of Group and Company tangible fixed assets includes an amount of £2,864,000 (2004: £3,200,000) in
respect of assets held under finance leases.
Analysis of net book amount of freehold land & buildings Group and Company
2005 2004
£’000 £’000
Freehold land 1,200 1,233
Freehold buildings 2,650 1,873
3,850 3,106
The freehold land and buildings occupied by the Company were revalued by external valuers, King Sturge LLP, at 31 March
2005 on the basis of existing use value, in accordance with the Appraisal and Valuation Manual of the Royal Institution of
Chartered Surveyors in the United Kingdom.
The valuation has been incorporated into the financial statements and the resulting revaluation adjustments have been
taken to the revaluation reserve. The revaluation resulted in a surplus of £1,754,000 (note 19).
No deferred tax is provided on timing differences arising from the revaluation of fixed assets unless, by the balance sheet
date, a binding commitment to sell the asset has been entered into and it is unlikely that any gain will be rolled over.
InTechnology plc Annual Report and Financial Statements 2005 page 42
9 Tangible fixed assets (continued)
The assets that have been revalued comprise the following land and buildings:
Group and Company
Freehold Freehold Total
land buildings
£’000 £’000 £’000
Net book value at 31 March 2005 1,200 2,650 3,850
Historical cost:
Cost 339 2,416 2,755
Accumulated depreciation - (659) (659)
Net book value 339 1,757 2,096
10 Investments
Company
£’000
Shares in group undertakings
At 1 April 2004 18,354
Additions in year:
Contingent consideration (note 8) 1,582
Exchange gain on translation of investment 193
Transfer to goodwill (note 8) (949)
At 31 March 2005 19,180
On 1 November 2003 the trade and net assets of Allasso UK Limited were transferred to InTechnology plc at book value,
following which the net investment held by InTechnology in Allasso UK Limited was £10,800,000. As the trade of Allasso
UK Limited was transferred to InTechnology, the value of the investment held was only supported by the net assets and
future cash flows of Allasso UK Limited’s trading subsidiaries, Allasso GmbH and Allasso Benelux bv. Since the transfer
does not impair the future profitability of the Company £949,000 (2004: £8,000,000) has been transferred from
investments to goodwill in the InTechnology company balance sheet. This represents the additional conditional
consideration that the directors now estimate will become payable (note 8).
Investments in Group undertakings are stated at cost.
InTechnology plc Annual Report and Financial Statements 2005 page 43
Notes to the financial statements (continued)
10 Investments (continued)
Details of the principal investments at 31 March 2005 in which the Group or Company holds more than 20% of the
nominal value of ordinary share capital are as follows:
Subsidiary Country of Nature of Group Company
undertakings incorporation business proportion proportion
or registration held held
Allasso SAS France Sale of computer security products 100% 100%
and ancillary services
Allasso GmbH Germany Sale of computer security products 100% -
and ancillary services
Allasso Iberia SAU Spain Sale of computer security products 100% -
and ancillary services
Allasso Italia Srl Italy Sale of computer security products 100% -
and ancillary services
Allasso Benelux bv The Netherlands Sale of computer security products 100% -
and ancillary services
Allasso AG Switzerland Sale of computer security products 100% 100%
and ancillary services
Allasso Limited England Dormant 100% 100%
HOLF Technologies Limited England Dormant 100% 100%
VData Limited England Dormant 100% 100%
Integrated Technology
(Europe) Limited England Dormant 100% 100%
11 Stocks
Group Company
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Goods for re-sale 13,179 10,811 12,597 10,383
InTechnology plc Annual Report and Financial Statements 2005 page 44
12 Debtors
Group Company
2005 2004 2005 2004
(Restated) (Restated)
£’000 £’000 £’000 £’000
Amounts falling due after more than one year:
Amounts owed by Group undertakings - - 1,455 1,455
Amounts falling due within one year:
Trade debtors 62,015 53,625 41,468 39,164
Other debtors 12,420 10,091 11,008 8,880
Deferred tax asset (note 16) 1,105 210 1,105 210
Corporation tax 576 425 155 -
Prepayments and accrued income 5,172 4,600 3,660 4,243
Deferred cost of sales 24,111 22,314 13,233 14,482
Amounts owed by Group undertakings - - 11,657 5,791
105,399 91,265 82,286 72,770
Total 105,399 91,265 83,741 74,225
Amounts owed by Group undertakings are unsecured.
InTechnology plc Annual Report and Financial Statements 2005 page 45
Notes to the financial statements (continued)
13 Creditors - amounts falling due within one year
Group Company
2005 2004 2005 2004
(Restated) (Restated)
£’000 £’000 £’000 £’000
Bank and other borrowings (IBM) 17,246 5,215 17,246 5,215
Loan from Peter Wilkinson 4,930 2,425 4,930 2,425
Obligations under finance leases 1,511 1,901 1,487 1,896
Trade creditors 52,139 48,139 47,163 44,056
Corporation tax --- 39
Other taxation and social security 5,337 6,227 3,811 5,133
Other creditors 673 469 70 3
Accruals 4,744 6,110 3,343 4,773
Deferred income 29,300 27,909 16,408 17,804
Contingent consideration (note 8) 2,294 - 2,294 -
Amounts owed to Group undertakings - - 3,414 3,604
118,174 98,395 100,166 84,948
Bank and other borrowings comprise loans due within one year which were provided by IBM United Kingdom Financial
Services Limited and Peter Wilkinson and are secured by fixed and floating charges over the assets of the Company dated
23 July 2003 and 31 July 2003 respectively.
14 Creditors - amounts falling due after more than one year
Group Company
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Bank and other borrowings (IBM) 573 3,354 573 3,354
Loan from Peter Wilkinson 7,395 12,325 7,395 12,325
Obligations under finance leases 1,033 1,564 1,033 1,537
Contingent consideration - 1,003 - 1,003
Amounts owed to Group undertakings - - 8,510 8,510
9,001 18,246 17,511 26,729
Amounts owed by Group undertakings are unsecured.
InTechnology plc Annual Report and Financial Statements 2005 page 46
14 Creditors - amounts falling due after more than one year (continued)
Bank and other borrowings and finance leases are repayable as follows:
Bank and other borrowings (IBM) Group Company
2005 2004 2005 2004
£’000 £’000 £’000 £’000
In one year or less 17,246 5,215 17,246 5,215
Between one and two years 573 2,236 573 2,236
Between two and five years - 1,118 - 1,118
17,819 8,569 17,819 8,569
Loan from Peter Wilkinson Group Company
2005 2004 2005 2004
£’000 £’000 £’000 £’000
In one year or less 5,000 2,500 5,000 2,500
Between one and two years 5,000 5,000 5,000 5,000
Between two and five years 2,500 7,500 2,500 7,500
Unamortised debt issue costs (175) (250) (175) (250)
12,325 14,750 12,325 14,750
Finance Leases Group Company
2005 2004 2005 2004
£’000 £’000 £’000 £’000
In one year or less 1,511 1,901 1,487 1,896
Between one and two years 957 1,064 957 1,037
Between two and five years 76 500 76 500
2,544 3,465 2,520 3,433
15 Financial instruments
The main financial risks faced by the Group include interest rate risk, liquidity risk and foreign currency risk. The Board
reviews and agrees policies for managing each of these risks.
The Group’s financial instruments comprise cash, liquid resources and various items, such as debtors and creditors that
arise directly from its operations. It is, and has been throughout the year under review, the Group’s policy that no trading
in financial instruments shall be undertaken. The year end position reflects these policies and there have been no changes
in policies or risks since the year end.
Although the Group has net debt of £22,200,000, £12,325,000 has been agreed at a fixed rate of interest of 8% thus
reducing the levels of interest rate exposure. Group policy is to continue to monitor financial markets and to repay
outstanding loans in line with agreed repayment schedules.
Financial asset returns are maximised by ongoing review of the Group’s cash flow requirements. Any funds surplus to
short-term working capital requirements are placed on interest bearing deposit.
InTechnology plc Annual Report and Financial Statements 2005 page 47
Notes to the financial statements (continued)
15 Financial instruments (continued)
Liquidity risk is further managed by agreeing separate borrowing facilities for any additional working capital and
investment requirements. In accordance with this policy, the Group has negotiated a sterling invoice discounting facility of
£26,728,000 with IBM, of which £14,953,000 was used as at 31 March 2005. This facility is provided on a rolling basis and
is subject to 60 days notice by either party.
Short term trade debtors and creditors have been excluded from all the following disclosures with the exception of the
Currency exposure analysis.
Interest rate risk profile of financial assets
The interest rate profile of the financial assets of the Group comprise cash of £10,488,000 as follows:
Currency Floating Rate
2005 2004
£’000 £’000
Sterling 8,242 14,749
US dollar 1,337 452
Euro 909 1,178
10,488 16,379
The sterling, US dollar and euro financial assets relate to cash at bank and bear interest based on GBP LIBOR, US Dollar
LIBOR and EURIBOR respectively. There are no fixed rate financial assets (2004: £nil).
Interest rate risk profile of financial liabilities
The interest rate profile of the financial liabilities of the Group is as follows:
Sterling Euro Total
2005 2004 2005 2004 2005 2004
£’000 £’000 £’000 £’000 £’000 £’000
Floating rate bank and other borrowings (IBM) 14,953 3,000 2,866 5,569 17,819 8,569
Fixed rate loan from Peter Wilkinson 12,325 14,750 - - 12,325 14,750
Fixed rate finance leases 2,520 3,433 24 32 2,544 3,465
Deferred shares 480 480 - - 480 480
Contingent consideration (zero interest) 50 - 2,244 1,003 2,294 1,003
Provisions for liabilities and charges
(zero interest) - - - 144 - 144
Total 30,328 21,663 5,134 6,748 35,462 28,411
Weighted average fixed interest rate 8.85% 8.44% 3.37% 4.50% 8.85% 8.44%
Weighted average period for which rate
is fixed 2.1 years 3.0 years 2.6 years 0.6 years 2.1 years 3.0 years
Weighted average period to maturity on 
which no interest is paid 0.3 years - 0.3 years 0.8 years 0.3 years 0.8 years
InTechnology plc Annual Report and Financial Statements 2005 page 48
15 Financial instruments (continued)
Deferred shares are excluded from the ‘weighted average period to maturity on which no interest is paid’ calculation as
there is no specified maturity date.
Financial liabilities include secured loan arrangements with IBM and Peter Wilkinson and finance leases and are detailed in
note 14. The floating rate sterling and Euro loans bear interest by reference to GBP LIBOR and EURIBOR respectively and
are repayable as set out in note 14.
Borrowing facilities
The Group has various borrowing facilities available to it. The undrawn committed facilities available as at 31 March, in
respect of which all conditions have been met at that date, were as follows:
2005 2004
£’000 £’000
Expiring within one year 11,774 4,669
Non-equity shares
A proportion of the Group’s share capital is attributable to non-equity interests, in the form of deferred shares of 1p each.
The rights and restrictions attaching to the deferred shares are described in note 18 to the financial statements.
Fair value
Fair value is the amount at which a financial instrument could be exchanged in an arm’s length transaction between
informed and willing parties, other than by a forced or liquidation sale, and excludes accrued interest. The fair values of
financial assets and liabilities as at 31 March 2005 approximate to the book value at those dates based on comparison
with similar instruments available from alternative providers.
Currency exposure
The Group seeks to mitigate the effects of the currency exposures arising from its net investments overseas by borrowing
as far as possible in the same currencies as the operating currencies of its main operating units. Gains and losses arising
on net investments overseas and the financial instruments used to hedge the currency exposures are recognised in the
statement of total recognised gains and losses.
The table below shows the extent to which group companies have monetary assets and liabilities in currencies other than their
local currency. Foreign exchange differences on translation of earnings are taken to the profit and loss account of the Group.
2005 2004
£’000 £’000
Functional currency of operation: Sterling
US dollar assets (net) 5,199 1,914
Euro assets / (liabilities) (net) 219 (2,232)
5,418 (318)
Functional currency of operation: Euro
US dollar liabilities (net) (12,722) (6,234)
Sterling assets (net) 8 -
(12,714) (6,234)
Hedges
With the exception of the hedging loan explained above the Group does not operate any hedging instruments.
InTechnology plc Annual Report and Financial Statements 2005 page 49
Notes to the financial statements (continued)
16 Deferred tax asset
Group and
Company
£’000
At 1 April 2004 210
Credited to the profit and loss account 895
At 31 March 2005 1,105
Deferred tax is measured on a non-discounted basis at the tax rates that are expected to apply in the periods in which
timing differences reverse, based on tax rates and laws substantively enacted at the balance sheet dates.
The deferred tax asset is included in debtors and is analysed as follows:
Group Amount recognised Amount not recognised
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Depreciation in excess of capital allowances 969 - - 410
Short term timing differences 136 210 - -
Losses carried forward - - 1,021 892
1,105 210 1,021 1,302
Company Amount recognised Amount not recognised
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Depreciation in excess of capital allowances 969 - - 410
Short term timing differences 136 210 - -
Losses carried forward - - 892 892
1,105 210 892 1,302
In addition, in the light of medium term forecasts prepared, the Group does not at present consider it more likely than not
that suitable taxable profits will be available to offset the losses carried forward, hence no deferred tax asset has been
recognised in respect of losses carried forward. In accordance with FRS 19 ‘Deferred tax’, the Directors will continue to
assess whether deferred tax assets should be recognised in respect of these items.
No provision has been made for deferred tax on revalued property. The tax on the gains arising would only become
payable if the property were sold without rollover relief being available. The tax which would be payable under such
circumstances is estimated to be £526,000 (2004: £nil). These assets are expected to be used in the continuing operations
of the business and, therefore, no tax is expected to be paid in the foreseeable future.
InTechnology plc Annual Report and Financial Statements 2005 page 50
17 Provisions for liabilities and charges
Group and
Company
Lease commitments
£’000
At 1 April 2004 144
Utilised in the year (144)
At 31 March 2005 -
18 Called up share capital
Company
2005 2004
£’000 £’000
Authorised
252,000,000 Ordinary shares of 1p each 2,520 2,520
48,000,000 Deferred shares of 1p each 480 480
Total 3,000 3,000
2005 2004
£’000 £’000
Allotted, called up and fully paid
141,111,944 (2004: 138,414,996) Ordinary shares of 1p each 1,411 1,384
48,000,000 Deferred shares of 1p each 480 480
Total 1,891 1,864
The number of allotted, called up and fully paid shares increased in the year as the Company issued 2,696,948 shares
(2004: 313,478 shares) in respect of the exercise of employee share options.
Deferred shares differ to ordinary shares in that they do not entitle the holder to receive any dividend or other
distribution; do not entitle the holder to vote at any general meeting of the Company; do entitle the holder on a winding
up to repayment of amounts paid only after payment in respect of each Ordinary Share of the capital paid up and a
further payment of £10,000 on each Ordinary Share and are treated as non-equity shares.
InTechnology plc Annual Report and Financial Statements 2005 page 51
Notes to the financial statements (continued)
18 Called up share capital (continued)
Share options
Certain employees hold options to subscribe for shares in the Company at prices ranging from 1.8p to 337.5p under the
share option schemes.
During the year the Company issued 2,696,948 shares (2004: 313,478 shares) in respect of the exercise of employee share
options.
The number of shares subject to options, the periods in which they were granted and the periods in which they may be
exercised are as follows:
Name of scheme No. of shares Exercise Earliest exercise Expiry
2005 2004 price (p) date date
HOLF scheme 7,078,373 7,712,056 43.3 23/12/02 23/12/09
VData scheme 3,135,917 4,953,576 1.8 07/01/03 07/01/10
InTechnology scheme 1,613,463 1,758,463 50.5 19/07/05 19/07/12
InTechnology scheme 1,150,000 1,150,000 52.0 04/07/05 04/07/12
InTechnology scheme 1,578,000 1,578,000 61.0 01/08/06 01/08/13
InTechnology scheme 517,500 500,000 65.0 15/07/03-11/06/05 15/07/06-11/06/12
InTechnology scheme 600,000 600,000 150.0 01/09/03-09/10/03 01/09/10-09/10/10
InTechnology scheme 304,000 311,000 172.0 15/03/04-20/12/04 15/03/11-20/12/11
InTechnology scheme 570,000 570,000 279.0 15/03/04-01/05/04 15/03/11-01/05/11
InTechnology scheme 50,000 50,000 327.5 02/01/04 02/01/11
InTechnology scheme 50,000 50,000 337.5 01/11/03 01/11/10
16,647,253 19,233,095
Further details of the share option schemes in operation are given under the heading ‘Interests in share options’ in the
Remuneration Report on pages 22 to 25.
InTechnology plc Annual Report and Financial Statements 2005 page 52
19 Shareholders’ funds
Group Ordinary Deferred Share Revaluation Profit & Total
share shares premium reserve loss shareholders’
capital account account funds
£’000 £’000 £’000 £’000 £’000 £’000
At 1 April 2004 as previously reported 1,384 480 188,420 - (97,508) 92,776
Prior year adjustment (note 2) - - - - (753) (753)
At 1 April 2004 as restated 1,384 480 188,420 - (98,261) 92,023
Issue of shares to satisfy employee share options 27 - 248 - - 275
Gain on revaluation - - - 1,754 - 1,754
Loss sustained for the year - - - - (2,575) (2,575)
Exchange adjustments - - - - --
At 31 March 2005 1,411 480 188,668 1,754 (100,836) 91,477
Company Ordinary Deferred Share Revaluation Profit & Total
share shares premium reserve loss shareholders’
capital account account funds
£’000 £’000 £’000 £’000 £’000 £’000
At 1 April 2004 as previously reported 1,384 480 188,420 - (97,495) 92,789
Prior year adjustment (note 2) - - - - (753) (753)
At 1 April 2004 as restated 1,384 480 188,420 - (98,248) 92,036
Issue of shares to satisfy employee share options 27 - 248 - - 275
Gain on revaluation - - - 1,754 - 1,754
Loss sustained for the year - - - - (2,388) (2,388)
Exchange adjustments - - - - - -
At 31 March 2005 1,411 480 188,668 1,754 (100,636) 91,677
Included in net exchange adjustments are exchange losses of £172,000 (2004: £301,000 gain) arising on borrowings
denominated in euro designated as hedges of overseas net investments which offset and equal the exchange gain arising
from the Group’s investment in Allasso Europe.
InTechnology plc Annual Report and Financial Statements 2005 page 53
Notes to the financial statements (continued)
20 Acquisition
On 18 June 2004, the Group acquired the trade and assets of NetConnect Training from NetConnect Limited for cash
consideration of £900,000 and contingent consideration to a maximum of £100,000. The contingent consideration is
dependent upon the continued employment of key personnel during the 12 month period following completion.
Additional contingent consideration of £50,000 was paid on 22 December 2004. The Directors estimate that further
contingent consideration of £50,000 will become payable by 18 June 2005.
The acquisition has been accounted for using acquisition accounting. No fair value adjustments were required and the
amounts in the following table represent the book and fair values of the assets and liabilities acquired and the
consideration paid:
Book and fair value
to the Group
£’000
Tangible fixed assets 47
Debtors 134
Deferred revenue (107)
Net assets 74
Goodwill arising on acquisition 956
1,030
Discharged by:
Cash consideration 900
Contingent consideration 100
Costs associated with the acquisition 30
1,030
InTechnology plc Annual Report and Financial Statements 2005 page 54
20 Acquisition (continued)
The unaudited results of NetConnect Training for the period 1 April 2004 to 18 June 2004 together with the unaudited
results extracted from NetConnect Limited management accounts and in line with NetConnect Limited accounting policies
for the year ended 31 March 2004 were as follows:
Period ended Year ended
18 June 2004 31 March 2004
(Unaudited) (Unaudited)
£’000 £’000
Turnover 284 1,504
Cost of sales (59) (467)
Gross profit 225 1,037
Net operating expenses before depreciation (160) (683)
Depreciation (5) (23)
Net operating expenses (165) (706)
Profit for the period 60 331
In the period since acquisition NetConnect contributed a net operating cash inflow of £159,000 and paid £80,000 in
taxation.
21 Reconciliation of operating (loss) / profit to net cash (outflow) / inflow from operating activities
2005 2004
Continuing acquisition Total (Restated)
£’000 £’000 £’000 £’000
Operating (loss) / profit (551) 267 (284) (3,030)
Depreciation of tangible fixed assets 6,388 - 6,388 5,640
Goodwill amortisation 4,597 38 4,635 4,403
Profit on disposal of tangible fixed assets (262) - (262) (87)
Exchange movements 14 - 14 (14)
Increase in stocks (2,368) - (2,368) (46)
Increased in debtors (12,829) (72) (12,901) (18,999)
Increase / (decrease) in creditors and provisions 2,852 (74) 2,778 15,618
Net cash (outflow) / inflow from operating activities (2,159) 159 (2,000) 3,485
InTechnology plc Annual Report and Financial Statements 2005 page 55
Notes to the financial statements (continued)
22 Reconciliation of movement in net debt
2005 2004
£’000 £’000
Decrease in cash in the year (5,935) (1,679)
Net cash outflow from decrease in finance leases 1,991 1,173
Net cash inflow from advance of debt (6,615) (18,090)
Change in net debt resulting from cash flows (10,559) (18,596)
Non-cash changes:
Exchange movements (91) 162
Inception of new finance leases (1,070) (2,134)
Finance leases on acquisition - (48)
Debt issue costs (75) 250
Movement in net debt in the year (11,795) (20,366)
Net (debt) / funds at start of year (10,405) 9,961
Net debt at end of year (22,200) (10,405)
23 Analysis of net debt
At 1 April Cashflow Exchange Other At 31 March
2004 movements non-cash 2005
changes
£’000 £’000 £’000 £’000 £’000
Cash at bank and in hand 16,379 (5,935) 44 - 10,488
Finance leases (3,465) 1,991 - (1,070) (2,544)
Debt due after more than one year (15,679) 7,738 (27) - (7,968)
Debt due within one year (7,640) (14,353) (108) (75) (22,176)
Net debt (10,405) (10,559) (91) (1,145) (22,200)
24 Directors’ emoluments
A detailed analysis of Directors’ individual emoluments, together with information on pensions, including that of the
highest paid Director, is given in the Remuneration report on page 24.
2005 2004
£’000 £’000
Aggregate emoluments 1,351 1,344
Company contributions to defined contribution pension schemes 60 57
Sums paid to third parties for directors’ services 110 99
1,521 1,500
During the year, retirement benefits were accruing to seven (2004: seven) Executive Directors under defined contribution
pension schemes.
InTechnology plc Annual Report and Financial Statements 2005 page 56
25 Employee information
The average monthly number of persons (including Executive Directors) employed by the Group during the year was:
By category 2005 2004
Number Number
Sales 202 142
Technical 102 94
Operations 115 82
Administration 91 71
510 389
Staff costs for the persons above were:
2005 2004
£’000 £’000
Wages and salaries 20,811 16,690
Social security costs 3,350 3,378
Pension costs 310 233
24,471 20,301
26 Financial commitments
At 31 March 2005, the Group had annual commitments under non-cancellable operating leases as follows:
Land & buildings Other assets
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Expiring within one year 305 205 244 222
Expiring within one to two years 265 650 74 231
Expiring within two to five years 1,501 450 173 61
Expiring after five years 1,296 1,660 - -
3,367 2,965 491 514
InTechnology plc Annual Report and Financial Statements 2005 page 57
Notes to the financial statements (continued)
27 Related party transactions
The Company has taken advantage of the exemption available under FRS 8 ‘Related Party Disclosures’ from disclosing
transactions between the Company and its subsidiary undertakings as these have been eliminated on consolidation of
these financial statements.
The acquisition of the Allasso group of companies was part funded by a loan of £15,000,000 made to InTechnology by
Peter Wilkinson, the Chief Executive Officer of the Group, repayable over a 4 year period commencing 31 July 2003. The
outstanding loan accrues interest at a fixed rate of 8% per annum. Arrangement fees of £300,000 paid to Peter Wilkinson
in respect of the loan have been capitalised and will be amortised to the profit and loss account over the period of the
loan in accordance with FRS 4. The loan outstanding at 31 March 2005 was £12,500,000 (2004: £15,000,000) and related
interested payments in the year were £1,152,000 (2004: £810,000).
Peter Wilkinson is a shareholder in British Sky Broadcasting plc (‘BSkyB’). InTechnology has sold services totalling £1,000
(2004: £149,000) to BSkyB in the year. As at 31 March 2005, InTechnology was owed £nil (2004: £29,000) by BSkyB.
Peter Wilkinson is a shareholder in the ultimate parent company of Planetfootball.com Limited, BSkyB. InTechnology has
sold services totalling £190,000 (2004: £183,000) to Planetfootball.com Limited in the year. As at 31 March 2005,
InTechnology was owed £20,000 (2004: £17,000) by Planetfootball.com Limited.
Peter Wilkinson is a non-Executive Director of, Richard James is a Director of and Peter Wilkinson, Richard James and John
Swingewood are shareholders in The New Gadget Shop Limited. InTechnology has sold services totalling £100,000 (2004:
£115,000) to The New Gadget Shop Limited in the year. As at 31 March 2005, InTechnology was owed £18,000 (2004:
£23,000) by The New Gadget Shop Limited.
Peter Wilkinson was Executive Chairman of, Richard James was a Director of and Peter Wilkinson, Richard James and John
Swingewood held beneficial interests in shares in Digital Interactive Television Group Limited until its sale to YooMedia plc
on 26 November 2004. InTechnology has sold services totalling £557,000 (2004: £855,000) to Digital Interactive Television
Group Limited in the year. As at 31 March 2005, InTechnology was owed £nil (2004: £271,000) by Digital Interactive
Television Group Limited.
John Swingewood is Executive Chairman of, Peter Wilkinson is a Director of and Peter Wilkinson and John Swingewood
hold beneficial interests in shares in YooMedia plc. InTechnology has sold services totalling £697,000 (2004: £nil) to
YooMedia plc in the year. As at 31 March 2005, InTechnology was owed £165,000 (2004: nil) by YooMedia plc.
Peter Wilkinson is a non-Executive Director and shareholder in and John Swingewood is a Director and shareholder in
Voicescape plc (formerly Getmedia plc). InTechnology has sold services totalling £1,000 (2004: £25,000) to Voicescape plc in
the year. As at 31 March 2005, InTechnology was owed £nil (2004: £2,000) by Voicescape plc.
Richard James is a Director and shareholder in and John Swingewood is a shareholder in Eescape Holdings Ltd.
InTechnology has sold services totalling £329,000 (2004: £nil) to and purchased services totalling £59,000 (2004: £nil) from
Eescape Holdings Ltd in the year. As at 31 March 2005, InTechnology was owed £86,000 (2004: £nil) by and owed £9,000
(2004: £nil) to Eescape Holdings Ltd.
The Company has maintained a current account at various stages during the year with Andrew Kaberry. The maximum
amount owed to the Company under this arrangement was £11,917 (2004: £9,064). This amount was fully repaid during
the year and there was no amount outstanding in respect of this loan as at 31 March 2005.
Included within other debtors is an amount of £40,000 (2004: £40,000) owing from Mark Chippendale, a member of the
Company’s management team.
All transactions with related parties were carried out on an arm’s length basis.
28 Ultimate controlling party
The Directors consider Peter Wilkinson to be the ultimate controlling party by virtue of his shareholding in the Company.
InTechnology plc Annual Report and Financial Statements 2005 page 58
Notice of Annual General Meeting
The Directors hereby give notice that
the Company will hold its Annual
General Meeting at Nidderdale House,
Beckwith Knowle, Otley Road,
Harrogate, HG3 1SA at 11 a.m. on 9
August 2005 (the ‘AGM’) for the
following purposes:
Ordinary business:
Resolution 1 To receive and adopt
the report of the Directors, the report
of the independent auditors of the
Company and the financial
statements of the Company for the
year ended 31 March 2005.
Resolution 2 To re-appoint Peter
Wilkinson as a Director, who retires by
rotation in accordance with Article 92
of the Articles of Association and
who, being eligible, offers himself for
re-appointment as a Director.
Resolution 3 To re-appoint Andrew
Kaberry as a Director, who retires by
rotation in accordance with Article 92
of the Articles of Association and
who, being eligible, offers himself for
re-appointment as a Director.
Resolution 4 To re-appoint Richard
James as a Director, who retires by
rotation in accordance with Article 92
of the Articles of Association and
who, being eligible, offers himself for
re-appointment as a Director.
Resolution 5 To re-appoint the Rt.
Hon. Lord Parkinson (aged 73) as a
Director, who retires by rotation in
accordance with Article 92 of the
Articles of Association and who, being
eligible, offers himself for re-
appointment as a Director.
Special business
To consider and, if thought fit, to pass
the following Resolutions. The
Directors will propose Resolutions 6
and 8 as ordinary resolutions and
Resolution 7 as a special resolution.
Resolution 6 That the Directors be
and are generally and unconditionally
authorised pursuant to section 80 of
the Companies Act 1985 (the ‘Act’) to
exercise all the powers of the
Company to allot relevant securities
(within the meaning of section 80 of
the Act) up to an aggregate nominal
amount of £653,714.27, provided that
such authority is for a period expiring
5 years from the date of this
Resolution 6, and save that the
Company may before such expiry
make an offer or agreement which
would or might require the Directors
to allot relevant securities after such
expiry and the Directors may allot
relevant securities in pursuance of
any such offer or agreement as if the
authority which this Resolution 6
confers had not expired. The authority
which this Resolution 6 confers shall
be in substitution to all subsisting
authorisations under section 80 of
the Act (to the extent unused) which
are hereby revoked.
Resolution 7 That, subject to the
passing of Resolution 6, the Directors
be and are empowered, pursuant to
section 95 of the Act, to allot equity
securities (within the meaning of
section 94(2) of the Act) for cash
pursuant to the authority which
Resolution 6 confers as if section
89(1) of the Act did not apply to any
such allotment, provided that this
power shall be limited to the
allotment of equity securities:
(a) in connection with or the subject
of an offer or invitation, including a
rights issue or open or equivalent
offer to holders of ordinary shares
and such other equity securities of
the Company as the Directors may
determine on the register on a fixed
record date in proportion (as near as
maybe) to the respective holdings of
such shares, but subject to such
exclusions or other arrangements as
the Directors may deem necessary or
expedient in relation to fractional
entitlements or any legal or practical
problems under the laws of, or the
requirements of, any recognised
regulatory body or any stock
exchange in any territory; and
(b) otherwise than pursuant to sub-
paragraph (a) above, up to an
aggregate nominal amount of
£69,207.49,
and shall expire 5 years from the date
of this Resolution 6, save that the
Company may before such expiry
make an offer or agreement which
would or might require the Directors
to allot equity securities after such
expiry and the Directors may allot
equity securities in pursuance of such
offer or agreement as if the power
which this Resolution 7 confers had
not expired.
Resolution 8 In accordance with
Sections 739 and 388(3) of the Act
that PricewaterhouseCoopers LLP be
re-appointed auditors of the
Company and hold office until the
conclusion of the next general
meeting at which accounts are laid
before the Company and that,
pursuant with section 390A of the
Act, their remuneration be fixed by
the Directors.
6 July 2005
By order of the Board 
Richard James
Director and Company Secretary
for and on behalf of InTechnology plc
Registered Office:
Nidderdale House
Beckwith Knowle
Otley Road
Harrogate
HG3 1SA
InTechnology plc Annual Report and Financial Statements 2005 page 59
Notice of Annual General Meeting (continued)
Notes:
1. A member of the Company (a
‘Shareholder’) entitled to attend and
vote at the AGM may appoint one or
more proxy (or proxies) to attend (and
on a poll) vote in his stead. Any
person (whether a Shareholder or not)
may be appointed to act as a proxy.
2. If a proxy is appointed for use at
the AGM, the form of proxy as issued
by the Board must be used. This form
of proxy is enclosed herewith reply-
paid. All forms of proxy, together with
the power of attorney or other
authority (if any) under which it is
executed, or a notarially certified copy
of such power or authority, must be
deposited at the Company’s registrars
at the following address by no later
than 11.a.m. on 5 August 2005 or 
any adjournment thereof: Capita
Registrars, The Registry,
34 Beckenham Road, Beckenham,
Kent, BR3 4TU.
3. Completion and return of a form
of proxy will not preclude a
Shareholder from attending and
voting at the AGM in person in
respect of which the proxy is
appointed (or at any adjournment of
the AGM) if such Shareholder
subsequently decides to do so.
4. The Company, pursuant to
Regulation 41 of the Uncertificated
Securities Regulations 2001 (2001 S.I.
No. 3755), specifies that only those
Shareholders registered on the
register of members of the Company
at 11 a.m. on 8 August 2005 (or, if the
AGM is adjourned, in the register of
members of the Company 48 hours
before the time of any adjourned
AGM) shall be entitled to attend and
vote at the AGM in respect of the
number of shares in the Company
registered in the name of such
Shareholders at that time. Changes to
entries on the register of members
after that time shall be disregarded in
determining the rights of any person
to attend or vote at the AGM.
5. Pursuant to sections 324 and 325
and paragraph 29, Part IV, Schedule
13 to the Act, the register of
Directors' interests in the Company
and a copy of the service agreements
between the Company and its
Directors will be available to the
public for inspection at the registered
office of the Company during usual
business hours on any weekday
(Saturdays, Sundays and public
holidays excluded) from the date of
this Notice to the time and date of
the AGM (including any adjornment
thereof) and also on the date and at
the place of the AGM from 15
minutes before the AGM to its
conclusion.
6. Pursuant to rule 20 of the AIM
rules this Notice, the accompanying
Form of proxy and the annual audited
accounts will be available for
inspection, free of charge, at the
registered office of the Company
during usual business hours on any
weekday (Saturdays, Sundays and
public holidays excluded) for a period
of one month from the date of this
Notice. 
7. Biographical details of the
Directors who are proposed for
reappointment at the AGM are set
out on pages 13 and 14 of the Annual
Report and Financial Statements of
the Company for the year ending 31
March 2005.
InTechnology plc Annual Report and Financial Statements 2005 page 60
Form of proxy for InTechnology plc
(Incorporated and registered in England and Wales under number 03916586) (the ‘Company’)
For use by holders of ordinary shares of 1p each in the Company (the ‘Shareholders’) at the annual general meeting of the Company to be held at the Company’s
registered office at Nidderdale House, Otley Road, Beckwith Knowle, Harrogate, HG3 1SA at 11am on Tuesday 9 August 2005 (the ‘AGM’). Please read the
Notice of AGM and the notes to this Proxy Form.
I/We*, (please insert the name of the Shareholder(s)* in full in BLOCK CAPITALS)
of
(please insert the full postal address of the Shareholder(s)* in full in BLOCK CAPITALS)
being Shareholder(s)* entitled to attend and vote at meetings of Shareholders, hereby appoint the Chairman of the AGM
†
as my/our* proxy attend and, on a poll, to vote for me/us* on my/our* behalf at the AGM, and at any adjournment thereof.
†
If it is desired to appoint some other person to be your proxy: (i) delete ‘the Chairman of the AGM’; (ii) initial the alteration; and (iii) insert the full name, title
and address of the person you wish to appoint as your proxy IN BLOCK CAPITALS. * Delete as appropriate.
Please indicate with an ‘X’ in the appropriate space how you wish your proxy to vote on the resolutions set out in the Notice or whether you wish the vote to
be withheld. (See note 6).
For Against Vote Withheld
1. Receipt and adoption of Directors’ report and financial statements and independent auditors’ report.
2. Re-appointment of Peter Wilkinson.
3. Re-appointment of Andrew Kaberry.
4. Re-appointment of Richard James.
5. Re-appointment of Rt. Hon. Lord Parkinson (aged 73).
6. Ordinary resolution - That the Directors are authorised to allot relevant securities.
7. Special resolution - That statutory pre-emption provisions are disapplied and the 
Directors are authorised to allot relevant securities for cash.
8. Ordinary resolution - That PricewaterhouseCoopers LLP be reappointed auditors of the Company, 
to hold office until the conclusion of the next general meeting at which the accounts are laid before 
the Company and that their remuneration be fixed by the Directors.
Dated 2005
Signature (see note 4 below) For and on behalf of the above named Shareholder(s)
Notes:
1 Who can be a proxy? Any person (whether a Shareholder or not) may be appointed
to act as a proxy.
2 Joint Shareholders: In the case of joint Shareholders the vote of the senior who
tenders a vote whether in person or by proxy will be accepted to the exclusion of the
votes of the other joint Shareholders. For this purpose seniority is determined by the
order in which the names stand in the register of members of the Company in respect
of the joint holding.
3 Corporate Shareholders: To be valid in the case of a Shareholder that is a corporation,
this proxy form must be executed under that corporate Shareholder’s common seal or
be signed on its behalf by an attorney or officer duly authorised.
4 What is required for the proxy to be effective: To be effective, this proxy form must
be: (a) duly executed; (b) deposited at the Company’s registrars at the following
address: Capita Registrars, The Registry, 34 Beckenham Road, Beckenham, Kent, BR3
4TU by no later than 11 a.m. on 5 August 2005 or any adjournment thereof; and
(c) deposited together, if appropriate, with the power of attorney or other authority (if
any) under which it is executed or a notarially certified copy of such power or, where
the form has been signed by an officer on behalf of a corporation, a notarially certified
copy of the authority under which it is signed.
5 Alterations: Any alterations made in or to this proxy form should be initialled by the
relevant Shareholder(s).
6 Proxy’s discretion: In the absence of any directions your proxy may vote or abstain
as the proxy thinks fit. On any motion to amend the resolution, to propose a new
resolution, to adjourn the AGM, or on any other motion put to the AGM, the proxy will
act at his/her/their discretion. Please note that if the ‘Vote Withheld’ box is marked
with an ‘X’, the Shareholder will not be counted in the calculation of votes ‘For’ and
‘Against’ and the Shareholder will not be taken to have given his/her/their discretion
to the proxy on how to vote.
7 Multiple proxies: A Shareholder may appoint more than one proxy to attend. When
two or more valid but differing instruments of proxy are delivered in respect of the
same share for use at the same meeting and in respect of the same matter, the one
which is last validly delivered (regardless of the date of its execution) shall be treated
as replacing and revoking the other or others as regards that share. If the Company is
unable to determine which instrument was last validly delivered, none of them shall
be treated as valid in respect of that share.
8 Shareholder attendance at the AGM: The completion and return of this proxy form
will not prevent you from attending in person and voting at the AGM or at any
adjournment thereof should you subsequently decide to do so. 
9 Record date: As provided by Regulation 41 of the Uncertificated Securities
Regulations 2001, only those members of the Company registered in the register of
members of the Company 24 hours before the time set for the AGM (i.e. 11 a.m. on
8 August 2005) shall be entitled to attend and vote at the AGM in respect of the
number of shares registered in their name at that time (or if the AGM is adjourned 48
hours before such adjourned AGM). Changes to entries on the relevant register of
members of the Company after that time shall be disregarded in determining the
rights of any person to attend or vote at the AGM.
10 Register of Directors' interests and Director’s service agreements: Pursuant to
sections 324 and 325 and paragraph 29, Part IV, Schedule 13 to the Act, the register
of Directors' interests in the Company and a copy of the service agreements between
the Company and its Directors will be available to the public for inspection at the
registered office of the Company during usual business hours on any weekday
(Saturdays, Sundays and public holidays excluded) from the date of this Notice to the
time and date of the AGM (including any adjournment thereof) and also on the date
and at the place of the AGM from 15 minutes before the AGM to its conclusion.
11 Inspection of Shareholder documents: Pursuant to rule 20 of the AIM rules this
Form of proxy, the accompanying Notice of the AGM and the annual audited accounts
will be available for inspection, free of charge, at the registered office of the Company
during usual business hours on any weekday (Saturdays, Sundays and public holidays
excluded) for a period of one month from the date of the Notice.
12 Definitions: Unless otherwise defined herein, capitalised terms shall have the
meaning ascribed to such terms in the notice of annual general meeting sent to
Shareholders and enclosed with this document. BUSINESS REPLY SERVICE
License No. MB122
1 1
Capita Registrars
Proxy Department
PO Box 25
Beckenham
Kent
BR3 4BR
Second Fold
Third Fold and Tuck in
First Fold
" page 62
Corporate information
Registered office:
InTechnology plc
Nidderdale House
Beckwith Knowle
Harrogate
HG3 1SA
Tel +44 (0)1423 850 000
Fax +44 (0)1423 858 855
Registrar and 
transfer office:
Capita IRG plc
Bourne House
34 Beckenham Road
Beckenham
Kent
BR3 4TU
Principal bankers:
Barclays Bank plc
Parliament Street
York
YO1 1XD
Nominated adviser
and broker:
Panmure Gordon & Co. plc
50 Stratton Street
London
W1J 8LL
Independent auditors:
PricewaterhouseCoopers LLP
Benson House
33 Wellington Street
Leeds
LS1 4JP
Solicitors:
Norton Rose
Kempson House
Camomile Street
London
EC3A 7AN
Company registration
number:
3916586
Internet addresses:
www.intechnology.co.uk
www.allasso.com
InTechnology plc Annual Report and Financial Statements 2005
Board of Directors:
The Rt. Hon. Lord Parkinson
Non-Executive President (Non-Executive Chairman, effective 21 April 2005)
Joe McNally Non-Executive Director
Charles Scott Non-Executive Director
Peter Wilkinson Executive Chairman (Chief Executive Officer, effective 21 April 2005)
Charles Cameron Chief Executive Officer (resigned 21 April 2005)
Richard James Director & Company Secretary
Andrew Kaberry Finance Director
Steve Pearce Chief Operating Officer and Business Development Director
Bryn Sage Sales Director
John Swingewood Chief Technical Officer page 63
Corporate information (continued)
Principal offices:
Headquarters
InTechnology plc
Nidderdale House
Beckwith Knowle
Harrogate
HG3 1SA
Tel +44 (0) 1423 850 000
Fax +44 (0) 1423 858 855
Northern Data Centre
InTechnology plc
Central House
Beckwith Knowle
Harrogate
HG3 1UG
Southern Data Centre
InTechnology plc
260-266 Goswell Road
Islington
London
EC1V 7EB
London Office
1 Threadneedle Street
London
EC2R 8AW
InTechnology Security (UK)
Building 1320
Arlington Business Park
Theale
Reading
RG7 4SA
Tel +44 (0) 1189 711 511
Fax +44 (0) 1189 711 522
Allasso S.A.S.
62 bis, Avenue André Morizet
92643 Boulogne-Billancourt cedex
Paris
France
Tel +33 (0) 1 46 84 15 00
Fax +33 (0) 1 46 84 15 01
Allasso GmbH
Orleansstraße 2 
81669 München 
Germany
Tel +49 (0) 89 450 660 0
Fax +49 (0) 89 450 660 33
Allasso Iberia S.A.U.
Via de los Poblados, 1
Parque Empresarial Alvento - Edificio
D 6ª planta
28033 Madrid
Spain
Tel +34 (0) 91 787 0600
Fax +34 (0) 91 787 0601
Allasso Italia S.r.l.
Centro Direzionale Ambrosiano
Via dei Missaglia, 97
20142, Milan
Italy
Tel +39 (0) 2 89 39 181
Fax +39 (0) 2 89 30 55 62
Allasso Benelux bv
Geldropseweg 8a
5731 SG Mierlo
The Netherlands
Tel +31 (0) 492 66 82 28
Fax +31 (0) 492 66 82 29
Allasso Portugal
Torres de Lisboa
Rua Tomás da Fonseca Torre G - 1º
1600 - 209 Lisboa
Portugal
Tel +351 (0) 217 230 616
Fax +351 (0) 217 230 666
Allasso AG
Seefeldstrasse 69
8008 Zürich
Switzerland
Tel +41 (0)43 488 36 66
Fax +41 (0)43 488 35 00
InTechnology plc Annual Report and Financial Statements 2005