Report & Accounts
for the year ended 31 December 2003
03 The Evolution Group Plc           Report & Accounts 2003  Financial and Operating Highlights 1
Chairman’s Statement 2
Chief Executive’s Report 4
Financial Review 8
Directors and Advisors 13
The Board 14
Directors’ Report 16
Corporate Governance 20
Remuneration Report 24
Independent Auditors’ Report 30
Financial Statements 32
Notes to the Financial Statements 36 The Evolution Group plc is a listed financial services group.  
Its principal operating businesses are:-
Evolution Beeson Gregory
a specialist small and mid cap investment bank
Christows
a leading private client stockbroker and fund manager
the evolution group plc
1
Report & Accounts 2003
The Group
Financial & Operating Highlights
Successful first full year
for EVBG
Successful first full year, as a combined business,
for Evolution Beeson Gregory, total operating
income increased to £32,100,000 (2002: £8,800,000)
Group retains 41% 
of IP2IPO
Group retains a 41% holding in IP2IPO post 
its flotation on AIM. At the float the Group
realised £15,000,000 from part disposal
Official List & FTSE-250
Group moved to the Official List in June 2003 
and recently entered the FTSE-250
46% increase in funds 
under management
Christows total funds under management
increased to £477m (2002: £327m) an increase of 46%
Operating income
increased by 159%
Total Group operating income increased 
by 159% to £40,751,000 (2002: £15,760,000)
Profit before tax 
over £17m
Profit before tax of £17,899,000 
(2002: Loss £23,770,000)
Inaugural dividend
payment
Earnings per share 6.7p (2002: Loss 13.7p)
Dividend payment 0.25p per share (2002: Nil) Chairman’s Statement
2
the evolution group plc
Report & Accounts 2003
2003 was a year of strong growth
in all of our operating businesses.
Additionally, the Group realised
significant value from the listing
of its former subsidiary, IP2IPO
Group Plc (formerly IP2IPO Group
Limited (“IP2IPO”)). Overall, I am
pleased to report a profit before
tax of £17.9 million (2002: loss
£23.8 million). Total shareholder
return rose 88% during 2003, 48%
ahead of the FTSE Smallcap Index.
Results
Evolution Beeson Gregory Limited
(“EVBG”) had a very good first full
year as a combined business and
our investment banking platform
developed significantly during 2003.
We continued to gain market share
in the small and mid cap sectors in
sales and trading and our
significantly enhanced market
making business performed well
and ahead of our expectations.
Corporate broking remained a
cornerstone of our business with
significant transactions completed
and funds raised for our clients.
Operating income has grown by
264% to £32.1m in 2003 with all
divisions showing extremely strong
growth. Finally, our research
coverage continues to increase in
depth and quality as evidenced by
our improved ratings in key market
surveys such as Extel and
Institutional Investor. Christows Limited (“Christows”), the
Group’s private client stockbroking
and fund management business,
had a second profitable year after
its restructuring in 2001. It
continues to increase its funds
under management, reaching
£477m as at 31 December 2003
(2002: £327m), an increase of 46%.
Strategic funds under management,
on which we receive recurring fees,
now represent 83% of this total
(2002: 77%). This business is
developing to plan and has
increased its geographical coverage
with the opening of a new office in
Bath, strengthening its presence in
the South and South West of
England. 
IP2IPO has made a significant
transformation during 2003.
Following the successful listing on
AIM on 15 October 2003, IP2IPO is
now a separate and independently
functioning operation. The Group
has reduced its holding in this
company to 40.61% following the
sale of 5,460,000 shares upon the
flotation. This process realised
£15m of cash.
Board changes
The Board is delighted to have
announced the appointment of
Nicholas Irens as a Non-executive
director on 1 January 2004. Nick
has a wealth of experience, from
both executive and non-executive
roles, and is a valuable addition to
the Board. 
At the time of the announcement
of IP2IPO’s preliminary results on 18
March 2004, David Norwood, the
Chief Executive of IP2IPO, informed
the Board of his decision to step
down as a Non-executive director of
the Company. I would like to take
this opportunity on behalf of the
Board, employees and shareholders
to thank David for his enormous
contribution both in the creation
and the successful building of the
Group.
Employees
The results of our operating
businesses are determined largely by
the efforts and commitment of our
staff who are one of the principal
assets of the Group. I would like to
thank everyone for their efforts last
year which contributed to a
successful 2003. As highlighted at
the interim stage and in the
subsequent shareholder notice, the
Group implemented an all employee
share incentive plan which has now
been successfully launched, through
which the majority of employees
have taken the opportunity to
purchase Evolution shares every
month, which are then matched by
the Company where individuals
remain in the Group for three years.
Additionally, throughout the Group,
there are other option and share
schemes which we use to provide
equity participation to incentivise
and motivate our key employees.  
Dividend
The Board recommends the
payment of a dividend of 0.25p per
share (2002: Nil). This represents an
acknowledgement of our growth in
confidence in the income growth
and profitability of the Group. It is
anticipated that a progressive
dividend policy will be pursued as
the Group achieves its objectives in
2004.
Outlook
As the first quarter of 2004
comes towards a conclusion, I am
pleased to announce that our
businesses are all continuing to
progress well and your Board is
confident of further success in
2004.
Richard Griffiths Chairman
30 March 2004
the evolution group plc
3
Report & Accounts 2003 Chief Executive’s Report
4
the evolution group plc
Report & Accounts 2003
Review of the year
The Group made substantial
progress in 2003. All areas of our
business have been strong, and
there has been a significant
increase in revenue generation.
Total revenue in 2003 was £40.8m
(2002: £15.8m), an increase of 159%.
During 2003, the Group was able to
create substantial shareholder value
in separating, by way of flotation,
our intellectual property subsidiary
IP2IPO, and the Group saw a
significant realisation from the sale
of part of the Group’s interest.
The core of the Group’s business
now consists principally of
Institutional Equity broking and
Private client stockbroking and fund
management, and both businesses
have outperformed the respective
budgets for 2003. It has always
been the Group’s strategy to retain
separate brands, and both are
managed as independent businesses
in all respects.
Performance Breakdown
Operating Income
2003 2002
£’000 % £’000 %
EVBG 32,126 79 8,835 56
Christows 8,327 20 6,644 42
Other income 298 1 281 2
40,751 100 15,760 100
Corporate finance 17,272 42 4,489 28
Sales commissions 9,067 22 5,913 38
Trading 10,994 27 2,196 14
Management fees 2,851 7 2,748 17
Other income 567 2 414 3
40,751 100 15,760 100
Evolution Group Operating Income
£m
40
30
20
10
0
99 00 01 02 03
0.5
5.0
7.8
15.8
40.8 the evolution group plc
5
Report & Accounts 2003
EVBG continues to be the largest
operating business within the
Group. Total operating income
increased by 264% to £32.1m (2002:
£8.8m), although conditions in 2003
were mixed. The first half was
dominated by the Gulf War and
difficult equity markets. EVBG was
able to trade profitably through this
period, with the reduced cost
structure that was introduced in
2002. The appetite for risk increased
in the second half of 2003 and
EVBG was able to accelerate its
income generation and profitability.
Corporate broking
Our corporate broking track
record in 2003 has been extremely
encouraging, overall income
increased by 285% to £17.3m
(2002: £4.5m).
During 2003 EVBG advised on 60
transactions. In total, we raised
£271m for our clients. Our ability to
provide these services successfully
for our clients comes from our
knowledge and understanding of
those client companies and the 
in-depth research into these
companies and their business
opportunities. Our retained
corporate client list had increased
to 107 at the year end. The
opportunity is still substantial to
provide integrated advisory services
to small and mid-cap UK companies.
EVBG continues to be innovative in
its thinking to provide equity
finance solutions to our customers.
Equity research and Equity
distribution
In research, EVBG has continued
to increase our sector coverage in
2003, reinforcing EVBG’s aim to be
a research led equity business with
qualified, specialist analysts. At the
year end, EVBG had coverage of in
excess of 190 stocks across sectors,
including: health, pharmaceutical
and biotech, general retail, leisure
and hotels, media and
entertainment, support services,
electronics, software, mining, oil
and gas, construction/building,
materials and infrastructure. The
improved research product is
evidenced by the continued market
share growth in sales and the
improved ratings in surveys such 
as Extel and Institutional Investor.
Sales and distribution have
strengthened throughout 2003.
EVBG has seen an increase in the
flow of secondary sales
commissions. New recruits to the
team have successfully secured new
sales channels into international
institutional investors. This new
dimension has increased
substantially the distribution
platform at EVBG.
Market-making and Trading
In 2003, EVBG made significant
changes to our trading operation.
In April, a new team was recruited
to realign entirely the market-
making direction, increasing the
number of stocks that we make
prices in to over 600 by the year
end. All our market-making and
trading activities across the mid and
the small cap traded profitably in
2003 and EVBG saw a significant
increase in transaction volumes.
Market-making ensures the
operation of an orderly and liquid
market and provides a service to
retail stockbrokers. EVBG has been
able to increase this part of the
business by adding further
electronic connectivity via the Retail
Service Provider (“RSP”) mechanism.
At the year end, we were members
of the London Stock Exchange and
Proquote hubs and have begun the
process of adding a further two RSP
connections.  
In summary, 2003 has seen EVBG’s
businesses develop significantly. 
I believe that, as we approach the
end of the first quarter of 2004, we
are confident of further income and
profitability growth . Chief Executive’s Report
- continued
6
the evolution group plc
Report & Accounts 2003
In 2003, we set a plan for
Christows of growth in scale and
attaining profitability. I am
pleased to report that both of
these achievements were met.
Total income increased by over
25% to £8.3 million which,
coupled with continued tight
management of costs, produced a
second consecutive profitable year
after the restructuring in 2001.
Transaction based income increased
by 39% from 2002 and included an
exceptional performance from our
contracts for difference team which
doubled its income. Our strategy of
growing funds under management,
particularly those strategic funds
upon which recurring management
fees are received, also proved
successful. Strategic funds under
management increased by 59% over
the previous period to £398m
(2002: £250m) making up 83% of
total funds under management at
the year end (2002: 77%).
Our growth in funds under
management was underpinned by
record sales, for the third
consecutive year, for our
professional intermediary sales
team, leading to Christows winning
new mandates to increase
significantly year end funds under
management to approximately
£477 million, an increase of 46%
over last year. Within our funds
under management we have seen
an extension of our offering to a
wider potential client base via our
OEIC, Multi-Manager Portfolio
Service and the successful Private
Portfolio Account, where we have
seen further growth in the average
portfolio size of our bespoke
discretionary clients. In addition, we
have been successful in recruiting
likeminded individuals who can
attract new clients to supplement
the organic growth from our sales
activities, and have been joined by
new account executives from a
variety of competitors.
During the middle part of the year,
we continued our regional
development by opening a new
branch office in Bath, which we
strongly believe will have
considerable potential in 2004 and
beyond. Finally, as the year came to
a close, we completed the process
of repatriating our OEICs to the UK
from Dublin, which will allow our
Fund Management team to utilise
the flexibility introduced by the new
UCITS legislation to supplement the
excellent performance of the funds
last year.
Christows begins 2004 with a
robust, scaleable platform for
growth and a continuation of the
trends apparent in the second half
of 2003 should contribute to
accelerating profitability in the
current year. IP2IPO operated as a subsidiary 
of the Group until October and
during this period concluded its
third university  partnership, when
in May 2003 it entered into a 25
year partnership with King’s
College London. At this point, it
raised £6.25 million through a
further round of private financing
to develop this relationship. In
September 2003, IP2IPO agreed
terms of a new 25 year partnership
with the University of York’s Centre
for Novel Agricultural Products
(‘‘CNAP’’) which was conditional
upon IP2IPO’s admission to AIM. 
In October 2003, IP2IPO
successfully listed on AIM raising
£31.5 million valuing this group at
£111.8 million. Since then it has
continued to make progress in the
development of spin out companies
from its on-going university
partnerships. At the time of the
admission to AIM, the Group
realised £15m from the sale of its
majority stake, leaving it with
40.61% of IP2IPO at the year end.
IP2IPO now operates as a separate,
independently managed business
and the Group’s interest is
monitored through the position of
Non-executive director, which I hold
on its board.
New Business
In August 2003, trading
commenced in Evolution Securities
China Limited (‘‘ESCL’’). This
company has its principal office in
London and a branch in Shanghai.
It offers investment banking services
to both Chinese and UK institutions
and is well placed strategically to
access the growing Chinese equities
market. ESCL combines a deep
knowledge of China, its economy
and its securities industry with first-
class securities analysis, sales
support and trade execution. ESCL
aims to meet the growing need
from professional investors for
attractive investment opportunities
in China at an acceptable level of
risk. ESCL’s integration within the
Group ensures that its corporate
activities are efficient and well
supported. ESCL is an appointed
representative of Evolution Beeson
Gregory Limited. 
Official List & New Offices
As outlined in the half year results,
the Company completed the move
to the Official List on 26 June 2003.
The head office for the Group and
its investment banking operations
changed to 100 Wood Street in
August 2003. The facilities provided
in this modern office, in the heart
of the City of London, has provided
a strong platform for our trading
and settlement operations and
brought us closer to our clients and
institutional investors.
Both of these achievements were
completed under tight timetables
and cost effectively.
Employees
We continue to recognise the
importance of developing a culture
where the employees’ interests are
aligned mutually with those of the
Group’s shareholders. This is
something that we aim to achieve
for the key performers in all of our
business units. Through the use of
the Group’s principal share and
share option schemes, we are able
to manage this by combining staff
incentivisation with a high degree
of loyalty. The use of such
arrangements resulted in a profit
and loss impact across the Group
during 2003 of £3.0 million,
principally in the form of a charge
for the cost of options (difference
between the market value of each
1p ordinary share and the exercise
price at the time of grant). It is our
firm belief that these arrangements
are extremely effective and that
incentivising and retaining our key
employees are in the interests of the
Group’s shareholders. 
Alex Snow Chief Executive Officer
30 March 2004
the evolution group plc
7
Report & Accounts 2003 Financial Review
8
the evolution group plc
Report & Accounts 2003
Adjusted operating profit
The statutory operating profit for the overall Group is as shown below. The Board believes a truer reflection of the
performance of the Group's on-going operating businesses is afforded by the measure ‘‘adjusted operating profit’’. 
This is calculated so as to exclude items from operating profit that are one-off or non-recurring, are not part of the 
on-going business profitability or, in the case of the cost of options and amortisation, represent non-cash items. 
The following table reconciles these two measures and demonstrates the significant progress made on a combined
Group basis in moving from an adjusted operating loss of £2.5 million in 2002 to an adjusted operating profit of 
£10.6 million in 2003.
31 December 31 December
2003 2002
£’000 £’000 £’000 £’000
Operating profit / (loss) 1,553 (24,790)
Items not included within adjusted operating profit
Profit on sale of fixed asset investments (2,379) (19)
Profit on sale of current asset investments (99) -
Provision against fixed asset investments 6,114 9,712
Adjustment for provisions and profits on investments 3,636 9,693
Non-recurring costs 1,113 1,276
IP2IPO subsidiary operating loss 599 -
Non-recurring items 1,712 1,276
Amortisation 567 252
Share of associated undertakings operating loss 186 -
Cost of options 2,963 166
Impairment of goodwill - 10,865
Non-cash items 3,716 11,283
Adjusted operating profit / (loss) 10,617 (2,538) Looking at the two principal operating businesses individually, it is clear to see the
progress made in both EVBG and Christows in 2003 from the previous period.
Investment Banking
Turning first to the Investment banking business of EVBG, there has been
significant growth in the scale and profitability of this business turning around
an adjusted operating loss of £0.5m in 2002 into an adjusted operating profit of
£10.6m in 2003.
2003 2002
£000’s £000’s
Operating income 32,126 8,835
Commissions payable (433) (169)
Gross profit 31,693 8,666
Administrative expenses (22,367) (10,151)
Profit on sale of current asset investments 99 -
Operating profit / (loss) 9,425 (1,485)
Profit on sale of current asset investments (99) -
Non-recurring and exceptional costs 713 953
Cost of options 571 -
Adjusted operating profit / (loss) 10,610 (532) 
Non-recurring and exceptional costs relate to costs of redundancy and relocation
expenses for new offices.
Revenue analysis
Further analysis of the quality of income achieved within the business shows the
balance of revenue between primary revenue and secondary income from sales and
trading. 
Cost analysis 
The overall cost/income ratio for the investment banking business is 66% 
(2002: 104%). A further examination of the cost structure of the investment
banking business shows that staff costs are 65% of the total cost base in 2003
with significantly more than half of this being entirely performance related.  
the evolution group plc
9
Report & Accounts 2003
Investment Banking
Revenue analysis
2003
2002
Corporate Finance 
53%
Trading
34%
Sales Commissions
13%
Other
1%
Trading
25%
Corporate 
Finance 
48%
Sales Commissions
26%
Investment Banking
Cost analysis
2003
2002
Staff Costs - 
Non performance related
27%
Non Recurring Costs
3%
Staff Costs - 
Performance related
38%
Other 
Costs
32%
Staff Costs - 
Non performance related 
44%
Non Recurring Costs
9%
Staff Costs - 
Performance related
8%
Other 
Costs
39% Financial Review
- continued
10
the evolution group plc
Report & Accounts 2003
Private client stockbroking and fund management
Turning to Christows, the Group’s private client stockbroking and fund
manager, 2003 has seen a continuation of the progress made last year with a
second consecutive year with an increase in adjusted operating profit from
£0.2m in 2002 to £0.4m in 2003. This occurred even taking into account the
extreme downturn in the first half of 2003, which saw the business levels in
this sector at an unprecedented low level. 
2003 2002
£000’s £000’s
Operating income 8,327 6,644
Commissions payable (2,201) (1,462)
Gross profit 6,126 5,182
Administrative expenses (6,008) (4,970)
Operating profit 118 212
Non-recurring and exceptional costs 174 -
Cost of options 71 -
Adjusted operating profit 363 212
Non-recurring and exceptional costs relate to costs of redundancy and search
expenses related to the acquisition of new account executive teams.
Revenue analysis
Christows’ sales commissions have increased significantly in 2003 over 2002, 
in particular due to the doubling of income from the contracts for difference
business. The recurring management fees on its strategic funds under management
have grown marginally over the whole year, with levels significantly reduced in
the first half, as market levels fell, and enhanced in the second half as funds
under management grew through sales and performance.
Cost analysis 
The overall cost/income ratio for Christows has improved to 69% (2002: 75%).
Further examination of the cost structure within Christows shows it remains
tightly managed and highly predictable. We have invested in the business in
2003 by opening a further office in Bath and recruiting a number of account
executives in the other offices. In addition we continue to invest in the systems
and infrastructure to support and further develop this business.
Private client stockbroking and
fund management cost analysis
2003
2002
Staff Costs - 
Non performance related
39%
Non Recurring Costs
3%
Staff Costs - 
Performance related
9%
Other Costs
49%
Staff Costs - 
Non performance related
36%
Other Costs
53%
Staff Costs - 
Performance related
11%
Private client stockbroking and
fund management revenue analysis
2003
2002
Corporate Finance
2%
Other Income
5%
Sales 
Comissions 
59%
Management
Fees
34%
Sales Comissions 
54%
Other Income
4%
Management
Fees
42% Other activities
The Group’s other activities are made up of central group support costs not
recovered from the operating businesses, the profits on, and provisions against,
legacy fixed asset investments, and the results of the IP2IPO business from the
period whilst it was a subsidiary of the Group. In addition, the results of
Evolution Securities China Limited are included as they are not material in this, 
its first period of operation after the business commenced in August 2003.
2003 2002
£000’s £000’s
Operating income 298 281
Commissions payable (22) -
Gross profit 276 281
Administrative expenses (4,345) (14,105)
Profit on fixed asset investments 2,379 19
Provision on fixed asset investments (6,114) (9,712)
Share of associated undertaking operating loss (186) -
Operating loss (7,990) (23,517)
Items not included within adjusted 
operating loss
Profit on sale of fixed asset investments (2,379) (19)
Provision against fixed asset investments 6,114 9,712
IP2IPO subsidiary operating loss 599 -
Non-recurring costs 226 323
Amortisation 567 252
Impairment of goodwill - 10,865
Share of associated undertaking operating loss 186 -
Cost of options 2,321 166
Adjusted operating loss (356) (2,218)
Non-recurring costs represent costs for loss of office and the costs in relation
to taking the Group to the Official List. 
Investment provisions
As outlined at the half year results, the Group has made provisions against
the remaining legacy portfolio investments totalling £6.1 million. The Group
continues to seek to extract value from this portfolio with profits on sale of
investments totalling £2.4 million in 2003. At the year end, the remaining fixed
asset investment portfolio has a carrying value of £0.9 million (2002: £6.4
million) and current asset investments held at a carrying value of £0.4m (2002:
£0.2m).
the evolution group plc
11
Report & Accounts 2003 Financial Review
- continued
12
the evolution group plc
Report & Accounts 2003
IP2IPO
The Group now retains 40.61% of IP2IPO Group Plc following the deemed
disposal of the Group’s interest in May, and the deemed disposal and sale of
shares in October 2003 at the time of its admission to AIM. This investment is
now treated as an associated undertaking within the Group and Company
accounts under FRS 9. As a result of the change in status from being a
subsidiary in 2002 to being an associate from 15 October 2003, the results of
IP2IPO to 15 October 2003 have been treated within continued earnings. In
future periods, the Group will recognise its share of operating profit, interest
and tax in the profit and loss account and its share of the fair value of net
assets in the balance sheet. 
The overall impact of the disposals in 2003 is a total gross profit of £16.9
million from which transaction costs and special bonus awards are deducted
resulting in a net profit of £15.1 million. Under FRS 3, Reporting Financial
Performance, this profit falls within the definition of “exceptional items” and is
thus disclosed separately after operating profit.
Balance sheet strength
The Group remains focused on maintaining a strong balance sheet. At the
year end it had net assets of £91.9 million (2002: £76.0 million) including cash
of £53.7 million (2002: £32.0 million). 
Cashflow
The Group generated positive cash inflow of £21.7m in the year (2002:
outflow of £4.0m). This has been achieved principally by operating profitability
and the disposal of IP2IPO.
Dividend
The Board is proposing an inaugural dividend per share for 2003 of 0.25p.
This dividend is payable on 4 June 2004 to shareholders on the register on 
7 May 2004.
Graeme Dell Finance Director
30 March 2004 Directors & Advisors
the evolution group plc
13
Report & Accounts 2003
Directors Richard Griffiths (Chairman)
Alex Snow (Chief Executive)
Graeme Dell (Finance Director)
Sir Malcolm Field (Non-executive)
Nicholas Irens (Non-executive)
George Loudon (Non-executive) 
Oliver Vaughan (Non-executive)
Company Secretary Nigel Gordon
Registered Office 9th Floor
100 Wood Street
London
EC2V 7AN
Auditors PricewaterhouseCoopers LLP
Southwark Towers
32 London Bridge Street
London
SE1 9SY
Solicitors Stringer Saul
17 Hanover Square
London
W1S 1HU
Broker Brewin Dolphin Securities Limited
48 St Vincent Street
Glasgow
G2 5TS
Registrars Capita Registrars
The Registry
34 Beckenham Road
Beckenham
Kent
BR3 4BR
Registered number 3359425 The Board
14
the evolution group plc
Report & Accounts 2003
The Evolution Group Plc is the
holding company of Evolution
Beeson Gregory Limited, Christows
Limited and Evolution Securities
China Limited. The Group has at
its core an extremely strong and
dynamic senior management
team in its Executive Board
members. The whole Group’s
operating structure, processes,
strategic direction and ethos are
based around this team. The
management of the operating
subsidiaries within the Group are
also led by members of this team.
Richard Griffiths (37),
Chairman, joined the Group upon its
acquisition of Evolution Capital in
March 2001. Richard was appointed
Chairman of the Group on 30
January 2003. He has extensive
experience of company
management, equity sales and
trading and has also been an active
investor in small and emerging
companies, often in turnaround
situations. Richard is Chairman of
the Board and chairs its Nominations
Committee. 
Alex Snow (34), 
Chief Executive Officer, joined the
Group in May 2000 and has led the
Group through its development from
a small investment company to a
fully fledged financial services group
by significant acquisitions and
resultant restructuring. Alex’s
previous career experience was with
CSFB and BZW in the equity sales,
trading and capital markets areas.
He is a graduate of St Andrew’s
University. Alex is in charge of the
day to day and strategic
management of the Group’s
activities. He heads the Executive
Committees that manage Evolution
Beeson Gregory, Christows and
Evolution Securities China Limited,
and is a Non-executive director on
the Board of IP2IPO.
Graeme Dell (37), 
Finance Director, joined the Group in
August 2001 and is responsible for
finance, operations and technology
throughout the Group. Graeme’s
previous career experience was with
Deutsche Bank as a business
manager in its Global Exchange
Services business and with Goldman
Sachs where he held management
positions in finance and operations.
He qualified as a Chartered
Accountant with Coopers & Lybrand
having graduated in Engineering
from Hertford College, Oxford
University. Graeme is a member of
the Executive Committees that
manage Evolution Beeson Gregory,
Christows and Evolution Securities
China Limited.
2
3
1 The Group’s Non-executive Board
members combine with the
Executive team to complete the
balance of corporate governance
and independence, and provide
between them a wealth of
experience in strategic and
operational management of
companies.
Sir Malcolm Field (66) is the
Senior Non-executive director and
Chairman of the Remuneration
Committee. He joined the Group
upon its merger with Beeson
Gregory Group in July 2002. He is
currently Chairman of Tube Lines
Limited and a policy advisor to the
Department for Transport. He was
previously Chairman of the Civil
Aviation Authority. Prior to this he
was Chief Executive at WH Smith
from which he retired in 1996 and a
Non-executive director of Scottish
and Newcastle Breweries Plc, MEPC
Plc and the Phoenix Group. 
David Norwood (36), joined the
Group upon its merger with Beeson
Gregory Group in July 2002. He
joined Beeson Gregory Group when it
acquired Index IT Partnership in
March 2000, a business he had
established to provide consultancy
services to technology companies.
David’s previous career experience
was with Bankers Trust as an FX
trader, Duncan Lawrie as an
investment analyst and Williams de
Broe, where he advised quoted and
unquoted technology companies. He
is a graduate of Modern History from
Keble College, Oxford University.
David leads the Intellectual Property
Group, IP2IPO, in which the Group
has a 40.61% interest, where he is
Chief Executive and responsible for its
operational management and
strategic direction. David resigned
from the Group on 18 March 2004.
Nicholas Irens (57), joined the
Group on 1 January 2004. Nicholas is
a chartered accountant with recent
and relevant financial experience. He
qualified as a Chartered Accountant in
1970 and went on to become the
Finance Director of First Leisure
Corporation Plc from 1988 to 1992.
Most recently he founded Vardon Plc,
renamed Cannons Group Plc, in 1992.
He was Chairman of this Group
between 1998 and 2001 when he
stepped down following its sale to
Royal Bank Private Equity. Nick
currently has a number of Non-
executive appointments, which include
the Non-executive Chair of Esporta
Group Limited, James Hull Associates
Limited, Northgate Information
Solutions Plc and Westminster Health
Care Limited, and Non-executive
directorships of Urbium Plc, Leisure
and Media VCT Plc and Ministry of
Sound Holdings Limited.
George Loudon (61) is
Chairman of the Audit Committee.
He joined the Group upon its merger
with Beeson Gregory Group in July
2002. His background is in
management consultancy, including
McKinsey & Co, and in banking both
in Holland and London, where he
was Chief Executive of Midland
Montagu and on the Board of
Midland Bank Plc.  Currently he is a
Non-executive director of a number
of companies such as LogicaCMG
plc, Viking River Cruises SA; is
Chairman of Helix Associates Limited,
Pall Mall Capital and others; and is
actively involved with the Multiple
Sclerosis International Federation,
the arts and conservation.
Oliver Vaughan (56), joined
the Board upon the incorporation of
the Company in April 1997. He has
an extensive background investing in
and being a director of AIM listed
companies. He co-founded Juliana’s
Holdings Plc in 1968, a holding
company with interests in the leisure
industry of which he was managing
director for 23 years.  He saw it
through to flotation on the London
Stock Exchange in 1983, prior to its
acquisition by Wembley Plc in 1989,
on whose board he then served for
the next two years. Currently he is a
Non-executive director of Abingdon
Capital Plc and Redstone Plc.
the evolution group plc
15
Report & Accounts 2003
4
5
6
7
8 Directors’ Report
16
the evolution group plc
Report & Accounts 2003
The directors present their report together with the audited financial statements for The Evolution Group Plc 
(the “Company”) and its subsidiaries (the “Group”) for the year ended 31 December 2003.
Principal activities and Review of business
The Company’s issued ordinary shares were admitted to the Official List on 26 June 2003.
The Group undertakes institutional investment banking through its subsidiary undertaking Evolution Beeson Gregory Limited
and undertakes private client stockbroking and fund management through its subsidiary undertaking Christows Limited.
The Group commenced a specialist Chinese investment banking business in August 2003 within Evolution Securities China
Limited (“ESCL”). This company was a new start-up, having been incorporated in July 2003.
The Group also has an interest of 40.61% in IP2IPO Group which specialises in intellectual property commercialisation. 
This follows the part disposal of the Group’s holding in this company during 2003.
A review of the businesses during 2003 and the prospects of the Group for the current year are set out in the Chairman’s
Statement, Chief Executive’s Report and Financial Review on pages 2 to 12.
Results and Dividends 
The profit for the year ended 31 December 2003 of The Evolution Group Plc amounted to £16,194,000 (2002: 
Loss £23,836,000). The Directors recommend the payment of a dividend of 0.25p per ordinary share (2002: £Nil).
Post balance sheet events
Full details of all significant post balance sheet events are set out in note 41 to the accounts.
Directors
The directors of the Company, who served during the year, together with their dates of resignation where appropriate, 
are shown below:
Date of Date of 
appointment resignation 
Richard Griffiths – – 
Alex Snow – – 
Graeme Dell – – 
David Norwood (Non-executive) – 18 March 2004 
Andrew Beeson (Non-executive) – 30 January 2003 
Sir Malcolm Field(Non-executive) – – 
George Loudon(Non-executive) – – 
Oliver Vaughan(Non-executive) – – 
David Norwood’s status changed from being an Executive to Non-executive director on 9 September 2003 following his
appointment as Chief Executive Officer of IP2IPO Group Plc. He resigned as a Non-executive director of the Group on 18
March 2004.
Subsequent to the year end, Nicholas Irens was appointed a Non-executive director on 1 January 2004.  Chairman
On 30 January 2003, Andrew Beeson resigned as Chairman to the Group and Richard Griffiths was appointed as his successor.
Directors’ Interests
The interests of directors in shares and options are disclosed in the Remuneration Report on pages 24 to 29. 
Charitable donations
During the year the Group made charitable donations of £7,520 (2002: £2,763). The Group’s general policy with repect to
charitable donations is to make a small number of donations to causes that are suggested by the Group’s employees,
particularly where such staff are taking part in fundraising events. The amount donated included payments of: £3,600 to
the NSPCC; £1,000 to Macmillan Cancer Relief; £1,000 to Whizzkids; £910 to All Hallows Church, London; and £500 to
The Leukaemia Trust.
Purchase of own shares
The Group currently operates one share trust. The Evolution Group Employees’ Share Trust administers The Evolution Group
Plc share schemes and is managed by the Sanne Trust. The Share Incentive Trust administered the legacy Beeson Gregory
Group share schemes and was managed by The Bank of Butterfield until the transfer of all holdings to the Sanne Trust on
25 May 2003.
Under The Evolution Group Employees’ Share Trust shares, which have been purchased but not unconditionally allocated to
an employee, are included within the balance sheet of the Company at cost. The cost of such shares at 31 December 2003
was £492,000 (2002: £484,000). The nominal value of such shares at 31 December 2003 is £8,600 which represented
0.34% of the called up share capital of the Company (2002: £8,000; 0.33%).
Creditors payment policy
It is the Group’s policy to agree appropriate terms and conditions for its transactions with suppliers by means ranging from
standard terms and conditions to individually negotiated contracts. Suppliers are paid according to agreed terms and
conditions, provided that the supplier meets those terms and conditions. Average trade creditor days at the year end was
24 days (2002: 25).
Committees
The Group currently operates a Nominations Committee, a Remuneration Committee and an Audit Committee. Details of
members, terms of reference and frequency are referred to in the Corporate Governance report on pages 20 to 23.
the evolution group plc
17
Report & Accounts 2003 Directors’ Report
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18
the evolution group plc
Report & Accounts 2003
Substantial shareholdings
Other than the interests of the directors, the following shareholders are known to have, or hold on behalf of individual
beneficiaries, an interest in the Company greater than 3%: 
Number of shares held by
Shareholder Name individual beneficiary Holding % Note
Cantor Fitzgerald Europe 12,606,000 5.08 1
HSBC Global Custody Nominee (UK) Limited 9,093,750 3.67 2
Barnard Nominees Limited 9,000,000 3.63 3
Clydesdale Bank (Head Office) Nominees Limited 8,567,500 3.46 4
Bank of New York (OCS) Nominees Limited 7,440,096 3.00 5
Notes
1 Notified to the Company on 8 March 2004.
2 Based on S212 Notification from the share register on 23 February 2004. In total, HSBC Global Custody Nominee (UK) Limited is known to hold
28,558,988 shares on behalf of beneficiaries, including the amount disclosed above, representing 11.52% of the Company.
3 Based on S212 Notification from the share register on 23 February 2004. In total, Barnard Nominees Limited is known to hold a total of
13,406,173 shares on behalf of beneficiaries, including the amount disclosed above, representing 5.41% of the Company.
4 Based on S212 Notification from the share register on 23 February 2004. In total, Clydesdale Bank (Head Office) Nominees Limited is known 
to hold a total of 9,098,578 shares on behalf of beneficiaries, including the amount disclosed above, representing 3.67% of the Company.
5 Based on S212 Notification from the share register on 23 February 2004. In total, Bank of New York (OCS) Nominees Limited is known to hold 
a total of 13,032,436 shares on behalf of beneficiaries, including the amount disclosed above, representing 5.26% of the Company.
The Company has not been notified of any other interests greater than 3% of the issued share capital as at 30 March 2004.
Employees
The average and actual number of employees, including directors, employed by the Group and their remuneration is
disclosed in notes 3, 7 and 8. 
Employment Policies
The Group encourages employees to participate in its success through performance based bonus arrangements and
through its use of share based incentive arrangements amongst its key performers within each of the business units. To
further this overall equity participation the Company has introduced an all Employees’ Share Ownership Plan, which was
approved by shareholders at the EGM on 10 October 2003. Following its introduction in February 2004, it allows every
employee to purchase up to £1,500 worth of the Company’s shares per annum on a tax efficient basis. These are purchased
on a monthly basis and held in trust and are matched by shares issued by the Company.
Employees are kept informed of the Group’s progress by half yearly Group results presentations. In addition, there are
monthly Executive Committee meetings from which further information is distributed to employees.
It is the Group’s policy that no employee, or applicant for employment, receives less favourable treatment (including
training and development, recruitment and promotion) by the Group or any other employee, on any grounds, including
disability, nor be disadvantaged by conditions, management attitudes, behaviour or requirements that cannot be justified. Implementation of IFRS
The adoption of the International Financial Reporting Standard (“IFRS”) framework for the year to 31 December 2005 is
applicable to the Company as a listed entity and will be adopted. It is not anticipated that the accounting treatment for
items within the profit and loss account will be materially different under the new regime. There are expected to be
differences in the balance sheet treatment of fixed asset investments under IAS 28, Investments In Associates; goodwill
under IAS 38, Intangible Assets; and employee share awards under IFRS 2, Share Based Payments. The difference in
treatment in these balance sheet items will impact the profit and loss account. 
Statement of Directors’ Responsibilities
The following statement, which should be read in conjunction with the independent auditors’ report set out on pages 30 to
31, is made with a view to distinguishing for shareholders the respective responsibilities of the directors and of the
independent auditors in relation to the financial statements.
The directors are required by the Companies Act 1985 to prepare financial statements for each financial year which give a
true and fair view of the state of affairs of the Company and the Group as at the end of the financial year and of the profit
or loss for the financial year.
The directors consider that in preparing the financial statements on pages 32 to 72 that:
• the Company and the Group have used appropriate accounting policies, consistently applied and supported by
reasonable and prudent judgements and estimates, and 
• all the accounting standards which they consider to be applicable have been followed, and
• the financial statements have been prepared on a going concern basis.
The directors have responsibility for ensuring that the Company and the Group keep accounting records which disclose with
reasonable accuracy the financial position of the Company and the Group and which enable them to ensure the financial
statements comply with the Companies Act 1985.
The directors have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the
Company and the Group and to prevent and detect fraud and other irregularities.
Auditors
PricewaterhouseCoopers LLP have indicated their willingness to continue in office, and pursuant to section 384 (1) of the
Companies Act 1985, an ordinary resolution re-appointing them as auditors and authorising the directors to determine their
remuneration will be proposed at the 2004 Annual General Meeting. The Audit Committee reviews and approves the
appointment of the external auditors.
By order of the Board
Nigel Gordon Secretary
30 March 2004
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20
the evolution group plc
Report & Accounts 2003
Compliance
The directors are responsible for the corporate governance of the Group. They support the principles of good corporate
governance and code of best practice laid down by the Combined Code issued in June 1998. Since the Company’s
successful application to the Official List on 26 June 2003 it has been in compliance with the provisions set out in Section 1 
of the Combined Code on Corporate Governance, issued in June 1998, as endorsed by the Financial Services Authority, 
save for the adoption by the Board of a formal schedule of matters reserved to it for decision. Throughout 2003, such 
items were addressed by the Board as a matter of course but these were not detailed in a formal list of reserved matters. 
This policy was formalised by the Board in February 2004 with the adoption of a formal schedule of matters reserved.
The manner in which the Group has applied the principles of good governance set out in the Combined Code is outlined
below.
Directors
The Board comprises three Executive and four Non-executive directors, whose biographies are set out on page 14 to 15. 
Sir Malcolm Field, the senior Non-executive director, Nick Irens, George Loudon and Oliver Vaughan are independent of
management for the purposes of the Combined Code. 
The Executive Chairman, Richard Griffiths, is responsible for the conduct of the Board and its oversight of the Group’s
affairs and strategy. The Chief Executive, Alex Snow, is responsible for the management of the business, the co-ordination 
of its activities and the development of strategy. In addition, Sir Malcolm Field acts as independent senior Non-executive
director. The Board believes that these arrangements facilitate the effective management of the business and provide a
strong control environment.
The biographies on pages 14 to 15 demonstrate a range of experience and sufficient calibre to bring independent
judgement on issues of strategy, performance, resources and standards of conduct which is vital to the success of the
Group. The Board is responsible to shareholders for the proper management of the Group. A statement of the directors’
responsibilities in respect of the accounts is set out on page 19 and a statement on going concern is set out below.
The Board has a schedule of 12 meetings per annum to discuss matters arising in the Group’s ordinary course of business.
Additional meetings are arranged as required. The Board is provided with appropriate information on a timely basis to
enable it to discharge its duties. The Board has put in place a formal schedule of matters reserved to it for decision,
including, inter alia, developing the future direction of the Group’s business, approving material transactions and budgets
and monitoring the Group’s progress. This was presented at the Board meeting in January 2004 and formally adopted on
26 February 2004. All directors receive written reports prior to each Board meeting which enable them to make an
informed decision on the corporate and business issues under review.
Beneath the Board there is a structure of delegated authority which sets out the authority levels allocated to the Executive
Committees of the Group’s three operating subsidiaries: Christows Limited; Evolution Beeson Gregory Limited and Evolution
Securities China Limited. The Executive Committees comprise the CEO and Finance Director and members of the senior
management teams of the three respective entities.
The terms of the directors’ service agreements and letters of appointment are summarised in the Report on Directors’
Remuneration. All directors are subject to election by shareholders at the first annual general meeting of shareholders after
their appointment. Thereafter, all directors are required to retire by rotation and one third of the Board will seek re-election
at each future annual general meeting. At the forthcoming AGM in May, Nicholas Irens will be subject to election as this will be the first AGM after his appointment.
Richard Griffiths and Graeme Dell will retire by rotation and, being eligible, seek re-election. Resolutions proposing their
election are set out in the Notice of Annual General Meeting. All directors have access to the services of the Company
Secretary and there are procedures in place for taking independent professional advice at the Group’s expense if required.
The following committees deal with the specific aspects of the Group’s affairs:
Audit Committee
The Audit Committee is comprised of independent Non-executive directors. George Loudon, who acts as Chairman of the
Audit Committee, Sir Malcolm Field, Oliver Vaughan and Nicholas Irens. Nicholas Irens joined the Committee upon his
appointment to the Board on 1 January 2004. Nicholas is a chartered accountant with recent and relevant financial
experience. The Audit Committee met three times during the course of 2003. The Committee’s terms of reference include:
reviewing the scope and findings of the external audit at interim and final stage; the effectiveness of the Group’s internal
control procedures; the reporting of results; and the requirement for an internal audit function. The Group’s auditors and
the Executive directors may attend committee meetings by invitation. The Committee has a discussion with the external
auditors at least once a year without Executive directors being present, to ensure that there are no unresolved issues of
concern. 
Remuneration Committee
The Remuneration Committee is comprised of independent Non-executive directors. The members are Sir Malcolm Field,
who acts as Chairman, George Loudon and Oliver Vaughan. In addition David Norwood sat on this committee as a non-
independent Non-executive member until his resignation in March 2004. Nicholas Irens joined the Committee upon his
appointment to the Board on 1 January 2004. The Remuneration Committee met four times during 2003. The Committee is
responsible for agreeing the remuneration of the Executive directors of the Company and for granting share options under
the Company’s share option schemes. The full Board is responsible for agreeing the remuneration of the Non-executive
directors. The Chief Executive and Executive Chairman attend certain parts of meetings of the Remuneration Committee by
invitation. Further details of the Group’s policies on remuneration, service contracts and share options are given in the
Report on Directors’ Remuneration.
Nominations Committee
The Nominations Committee is chaired by Richard Griffiths, the Executive Chairman, who is joined by all the Non-executive
directors. The Nominations Committee is responsible for proposing candidates for appointment to the Board, having regard
to the balance and structure of the Board. The appointment of Nicholas Irens on 1 January 2004 was considered by the full
Board to improve the breadth and depth of experience of its Non-executive directors. The Nominations Committee met twice
during 2003. No external advertising or external advice was used in connection with this appointment. The Board considered
that the broad knowledge and experience of Nicholas Irens in his past executive positions and current and recent Non-
executive positions across a range of industries and company ownership structures would be an important asset to the Board.
Review of Internal controls and Risks 
The Group operates an on-going process of internal controls which are designed to manage rather than eliminate entirely
the risk of failure to achieve business objectives. Therefore these can only provide reasonable and not absolute assurance
against material misstatement or loss. 
the evolution group plc
21
Report & Accounts 2003 Corporate Governance
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the evolution group plc
Report & Accounts 2003
At the time of the Group’s application to move from AIM to the Official List of the UK Listing Authority on 29 May 2003
(completed 26 June 2003), the Board carried out a review of its financial and management reporting procedures, internal
control systems and risk management. The Board concluded these were sufficient to provide a reasonable basis for it to
make proper judgements as to the financial position and prospects of The Evolution Group Plc in accordance with
paragraph 2.15 of the Listing Rules of the UK Listing Authority. The Group has continued to maintain these procedures
throughout the subsequent period.
The Board is responsible for identifying, evaluating and managing the significant risks faced by the Group. At the Board
meeting in March 2004 the Audit Committee reported on a follow up review performed in February and March 2004 which
reviewed the ongoing effectiveness of the Group’s internal control systems. The review considered all the controls, including
financial, operational and compliance controls and risk management. The Group has decided that due to its size and the
relatively limited scope of its operations that it has sufficient monitoring, reconciliation and control procedures in place to
justify not having an internal audit function. This situation will continue to be monitored by the Board. 
The Group has detailed policies and procedures in place in all areas of its operations. Its operations, finance and compliance
staff utilise extensive reconciliation and monitoring to ensure control throughout the reporting of its business operations.
Trading is monitored by the Executive directors daily. The Board considers monthly management accounts and compares
actual performance against budgets and plans and discusses any issues arising therefrom. In addition the Evolution Beeson
Gregory Limited and Christows Limited Executive Committees meet monthly to consider all major operational issues, trading
developments and ad hoc projects in the respective operating businesses.
Evolution Beeson Gregory Limited and Christows Limited are both authorised and regulated by the Financial Services
Authority. Evolution Securities China Limited is an appointed representative of EVBG. The Group therefore has a specialist
compliance department. This department is responsible for maintaining a detailed and up to date understanding and
interpretation of the rules and regulations that each of the entities is subject to and carrying out regular monitoring that
procedures are being implemented in compliance with these rules. The Compliance officers are in regular contact with the
Executive directors and report formally to the Board each month and periodically to the Audit Committee.
The Company has complied with the Turnbull Committee’s guidance for directors. Identifying, evaluating and managing the
Group’s significant risks is an ongoing process which is regularly reviewed by the Board, and which has been in place for
the year ended 31st December 2003 and up to the date of the approval of these financial statements.
The Committee concludes that the risks identified for the year to 31 December 2003 are adequately managed and
mitigated through the robust system of internal controls in place throughout the Group. The report to the Committee in
March 2004 also supported the conclusion that the on-going effectiveness of internal controls remains intact. 
Going Concern
The financial statements are prepared on a going concern basis as the directors have satisfied themselves that, at the time
of approving the financial statements, the Group has adequate resources to continue in operational existence for the
foreseeable future. Auditor independence
The Group has appointed PricewaterhouseCoopers LLP as auditors of the holding company and all subsidiaries since 2001.
During the year the Audit Committee reviewed the cost effectiveness, objectivity and independence of the auditors. The
auditors disclosed the level of fees received in respect of the various services provided by their firm in addition to audit
during 2003. They confirmed to the Audit Committee that they did not believe that the level of non-audit fees had affected
their independence. The Audit Committee’s policy is to use the most appropriate advisers for non-audit work taking
account of the need to maintain independence.
In addition to their statutory audit responsibilities, the Group will typically use the auditors for other work that they are well
placed to undertake in that role. This includes areas such as: regulatory reviews and other ancillary audit work; work in
respect of acquisitions and disposals; and tax and VAT compliance.
Several firms are considered for other work, including the auditors in some instances. In such cases due consideration is
given to the impact of the assignment on the independence of the auditors and to their qualifications to carry out the role.
Having given consideration to the extra work undertaken by the auditors, and after careful discussion with the responsible
partner in the firm and the Executive directors, the Audit Committee is satisfied as to the independence of the statutory
auditors.
Relations with Shareholders
The Chairman’s Statement, Chief Executive’s Review and Financial Review in this report and accounts include a detailed
review of the business and future developments as a way of informing shareholders of the Group’s performance and
progress. There is also regular dialogue with institutional investors, and analysts, principally around the time of the
Company’s preliminary announcement of results for the year and also when the interim results are announced. The Board
uses the Annual General Meeting to communicate with private and institutional investors and welcomes their participation.
The Chairman aims to ensure that all of the directors are available at Annual General Meetings to answer questions. The
proxy votes cast on each resolution proposed at general meetings are disclosed at those meetings.
The Board recognises the importance of investor relations and communications with shareholders throughout the year as
well as at the time of results. The Group’s website at www.evolution-group.com contains information on the Group, its
operating subsidiaries and the products and services which it offers as well as share price performance and recent
announcements.
the evolution group plc
23
Report & Accounts 2003 Remuneration Report
24
the evolution group plc
Report & Accounts 2003
The Board has delegated to the Remuneration Committee the assessment and recommendation of policy on the
remuneration for Executive directors.
The constitution and operation of the Committee comply with the Best Practice Provisions on Directors’ Remuneration in the
Combined Code of the UK Listing Authority.
This report has been prepared in accordance with the Schedule 7A of the Companies Act 1985, which introduced new
statutory requirements for the disclosure of Directors’ remuneration in respect of periods ending on or after 31 December
2002. The report also meets the relevant requirements of the Listing Rules of the UK Listing Authority and describes how the
Board has applied the Principles of Good Governance relating to Directors’ remuneration. As required by the Remuneration
Report Regulations, the directors remuneration report will be submitted to the forthcoming AGM for approval.
Members of the Remuneration Committee
The Remuneration Committee consists of independent Non-executive directors. Sir Malcolm Field was the Chairman of the
Remuneration Committee throughout 2003. For the entire period he was joined on the Committee by George Loudon and
Oliver Vaughan. David Norwood was appointed to the Remuneration Committee upon his appointment as Non-executive
director on 9 September 2003 until his resignation on 18 March 2004. Nicholas Irens joined the Committee from 1 January
2004, the date of his appointment to the Board.
Remuneration Policy
Throughout the Group there is an overriding philosophy on remuneration to attract, retain and incentivise the best staff.
This is a people business and they are the key to the ongoing success of the business. 
Consistent with this philosophy, the Group’s reward structure for the Executive directors is to provide competitive
employment packages. Executive directors’ rewards comprise a mix of performance-related and non-performance-related
remuneration. A high proportion of total remuneration is to be delivered through performance designed not only to
incentivise directors, but also to adhere to good corporate governance practice. 
During the year the Committee has utilised the services of professional advisors that specialise in matters of executive
director remuneration. The Chairman of the Remuneration Committee met with representatives of several institutional
shareholders to outline the Group’s remuneration policy.
Remuneration packages
The Executive directors reward packages are made up of three elements. Firstly, the fixed component is made up of basic
salary and benefits in kind such as medical, life and critical illness and permanent health insurances and car allowance. In
2002 the Board implemented a salary cap throughout the Group of £100,000. This included Executive directors and was
kept in place throughout 2003 and is intended to remain in place going forward. Salaries are reviewed on an annual basis
at the time of the Group performance appraisal process that takes place at the end of each calendar year.
Secondly, there is an annual performance bonus. The Group has implemented an annual bonus scheme as part of the
Group’s overall reward structure in common with general practice in the investment banking and stockbroking sectors. 
The Remuneration Committee has implemented these schemes with regard to the attainment of certain performance goals
from the respective business units to ensure an appropriate share of income between staff and shareholders taking into
account the market conditions and the stage of development of the business units. The annual performance bonus
component of the Executive directors is drawn from these overall bonus schemes. Each director has detailed, demanding
and in some cases different operating business and Group performance criteria against which they are measured. These
performance goals are set by the Remuneration Committee and performance is determined by them. Thirdly, the final element of reward for the Executive directors is the long term incentive plan in the form of the award of
shares in the Company under the 2002 Executive share incentive scheme. The first of these awards was made by the
Remuneration Committee in November 2003 in respect of the services of the CEO, Alex Snow, for the periods 2004 and
2005. The award was conditional upon strict performance criteria that requires a growth in the Group’s adjusted earnings
per share based upon the “adjusted operating profit” measure of the Group over the two periods of 15% per annum from
the level attained in the first half of 2003. This measure has been chosen as it best reflects the Group’s target for growth
appropriate to the sector and the market conditions in which the Group operates, and is therefore appropriately aligned
with shareholders’ interests. These awards will be confirmed at the time of the announcement of the results for these two
years in April 2005 and 2006 respectively.
Special bonuses and awards
The Remuneration Committee made two further elements of special compensation awards to some of the Executive
directors in 2003 in respect of certain special circumstances.
In October 2003 at the time of the admission to AIM of the Group’s former subsidiary company, IP2IPO Group Plc, the
Group was able to crystallise an amount of £15 million upon the sale of a part of its stake alongside the placing by IP2IPO
of new shares to investors. The Remuneration Committee viewed the achievement of this as a significant milestone in the
recognition of value for shareholders of the business acquired at the time of the acquisition of Beeson Gregory in July 2002.
Therefore a special bonus of 10% of the net cash realised was created and awarded amongst the Executive directors and
staff that had made the greatest contribution towards delivering this value to the Group.
In November 2003, the Remuneration Committee made an award under the 2002 Executive Share Incentive Scheme to the
CEO, Alex Snow, in recognition of the conclusion of negotiations securing the establishment of an appropriate service
contract. Prior to this Mr Snow’s services were the subject of verbal arrangements made at the time of his joining the Group
in a non-board capacity in May 2000. The new arrangements are in the form of a formal service agreement that is legally
enforceable and contains the appropriate notice clauses and restrictive covenants. The Board considered that the Group’s
interests were served by the establishment of such a contract as a matter of paramount importance given that securing Mr
Snow’s ongoing services is believed to be fundamental to the success of the Group. This was previously announced by an
RNS announcement dated 14 November 2003.
Proportion of fixed and variable remuneration
In line with the reward structure outlined above, the relative proportions of fixed annual remuneration and performance
related pay made for 2003 for the executive directors are as follows:-
Non-Performance related Performance related
Special
(%) Bonus (%) award (%) Total (%)
Richard Griffiths 9.3 72.9 17.8 100
Alex Snow 6.9 60.7 32.4 100
Graeme Dell 19.0 58.4 22.6 100
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Report & Accounts 2003 Remuneration Report
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the evolution group plc
Report & Accounts 2003
Directors’ service contracts
The Combined Code recommends that a one-year notice period or contract terms be set as an objective for Executive
directors. The Remuneration Committee’s policy is that service contracts should not have a notice period exceeding 
12 months and should not contain a liquidated damages clause in the event of termination.
All Executive directors have service contracts with no fixed terms and with notice periods of 12 months or less. The principal
terms extant in these contracts are as set out below. The directors’ service contracts and letters of engagement for Non-
executive directors will be available for inspection at the Company’s AGM.
Contractual
Contract date Notice period termination payments
Alex Snow 13.11.03 12 months None
Richard Griffiths 29.03.01 12 months None
Graeme Dell 03.07.01 3 months None
Non-executive directors
Non-executive directors do not hold service contracts. The dates of their appointment are shown on pages 14 to 15.
The Non-executive directors are each appointed for an initial term of one year and thereafter reviewed at the time of each
AGM. Fees for all Non-executive directors are set by the Chairman and Executive directors. The Non-executive directors are
not involved in the discussions to determine their own remuneration.
Non-executive directors do not participate in the Group’s annual bonus arrangements or long-term incentive arrangements. 
David Norwood was granted share options during his time as an Executive director of the Company and participated in
bonuses during 2003 in respect of his services as an Executive director up until 9 September 2003. At this point he took up
full time executive responsibilities with IP2IPO and became a Non-executive director of the Company. David resigned as a
director of the Company on 18 March 2004. 
The above graph shows the total shareholder return (“TSR”) against that of the FTSE Smallcap Index. TSR is calculated
assuming dividends are reinvested on receipt.
Over the last five years, The Evolution Group Plc has significantly outperformed the FTSE Smallcap Index to give a total
shareholder return for the five year period of 407%, compared to a total shareholder return provided by the FTSE Smallcap
Index of 37%. 
Performance Graph
TSR (rebased) Evolution Group - TSR FTSE Smallcap - TSR
3,000
2,500
2,000
1,500
1,000
500
0
31-Dec-98 31-Dec-99 31-Dec-00 31-Dec-01 31-Dec-02 31-Dec-03
100
1,874
287
442 270
507
137 In the opinion of the directors, the FTSE Smallcap Index is the most appropriate index against which the total shareholder
return of the Group should be measured because it is an index of similar-sized companies to the Group.
Auditable information 
The report on remuneration from page 24 up to this statement has not been audited. The following information has been
audited by the Company's auditors, PricewaterhouseCoopers LLP, as required by Schedule 7A to the Companies Act 1985. 
A summary of the total remuneration paid to Executive and Non-executive directors appears in the table below:
Annual Compensation
Salary/ performance Benefits Special for loss of Total Total
fees cash bonus in kind Awards office 2003 2002 Note
£’000 £’000 £’000 £’000 £’000 £’000 £’000
Executive directors
Richard Griffiths 100 900 15 220 - 1,235 167 (1)
Alex Snow 100 900 2 480 - 1,482 234 (1) (2)
Graeme Dell 100 310 1 120 - 531 209 (1)
Non-executive directors
David Norwood 86 150 1 480 - 717 86 (1) (5)
George Loudon 20 - - - - 20 8 (3)
Sir Malcolm Field 20 - - - - 20 8 (3)
Oliver Vaughan 20 - - - - 20 12
Andrew Beeson 5 - - - 79 84 41 (4)
Total 451 2,260 19 1,300 79 4,109 765
Notes to remuneration in above table
1 The special award was made in October 2003 at the time of the successful admission to AIM of IP2IPO.
2 In addition to emoluments received, share options were granted during the year. For full details of these see the table on Directors’ share options
on page 28.
3 The comparative figures for 2002 are for the period from 11 July 2002 to 31 December 2002, following the acquisition of the Beeson Gregory Group.
4 The comparative figure is based on the period from 11 July 2002 to 31 December 2002 whilst the current year is based on the one month
to 31 January 2003. The compensation for loss of office payment to Mr A Beeson who resigned on 31 January 2004 was paid in cash in
recognition of his past executive services to the Company.
5 David Norwood was an Executive director until he became a Non-executive director on 9 September 2003. He resigned from the Board on 
18 March 2004. His salary and performance payments were made in recognition of his executive services to the Company.
Benefits in kind represent contributions for private medical insurance and in the case of Mr R Griffiths, the provision of 
a company car and for Mr A Snow, the provision of a company car allowance.
Directors’ pensions
None of the directors receive any pension contributions from the Group either under defined contribution or final salary
schemes.
the evolution group plc
27
Report & Accounts 2003 Remuneration Report
- continued
28
the evolution group plc
Report & Accounts 2003
Directors’ shares under option 
Date of grant Note At 1 Granted Exercised Earliest Expiry Exercise Market Cancelled At 31
January during during the exercise Date price (p) price at during the December
2003 the year year date exercise year 2002
date (p) 
Richard Griffiths
11.05.01 (3) 2,025,933 – – 12.05.03 11.05.11 58.67 – – 2,025,933
Alex Snow
14.12.00 (4) 500,000 – – 14.12.00 13.12.05 25.00 – – 500,000
11.05.01 (2) 1,065,632 – – 12.05.04 11.05.11 58.67 – – 1,065,632
11.05.01 (3) 2,025,933 – – 12.05.03 11.05.11 58.67 – – 2,025,933
29.06.01 (1) 1,500,000 – – 30.06.04 29.06.11 52.30 – – 1,500,000
14.11.03 (8) – 2,000,000 – 14.11.03 14.11.13 1.00 – – 2,000,000
14.11.03 (9) – 2,000,000 – 15.04.05 14.11.13 1.00 – – 2,000,000
§4.11.03 (9) – 2,000,000 – 15.04.06 14.11.13 1.00 – – 2,000,000
Graeme Dell
06.07.01 (1), (10) 271,002 – – 07.07.04 06.07.11 55.35 – 271,002 –
31.01.03 (11) – 500,000 – 01.02.06 31.01.13 41.40 – – 500,000
31.01.03 (12) – 500,000 – 01.02.06 31.01.13 1.00 – – 500,000
Andrew Beeson
24.11.99 (5) 163,371 – 163,371 24.11.02 24.11.09 28.25 97.00 – –
24.11.99 (5) 102,129 – 102,129 24.11.02 24.11.09 28.25 97.00 – –
David Norwood
19.04.01 (6) 103,617 – – 19.04.04 18.04.11 – – 103,617
16.03.00 (7) 1,063,982 – 1,063,982 09.08.02 31.01.04 10.03 66.00 – –
No options lapsed during the year to 31 December 2003.
Save as set out above, no directors nor members of the immediate family of directors, have any options over shares in the
Company or any Group company or, during the year to 31 December 2003, was granted or exercised an option over shares
in the Company.
The market price for an ordinary share in the Company at 31 December 2003 was £1.015 (2002: £0.54). The highest price
throughout the year was £1.025 and the lowest was £0.33.
Summary of schemes for Directors’ options in the above tables
1 These options were granted under the 2001 Executive Share Option Scheme. Under the terms of this scheme the performance criteria require
that the closing bid of The Evolution Group Plc share price as derived from the Daily Official List published by The London Stock Exchange Plc
must be not less on average than a specified amount for a period of sixty consecutive days before options can be exercised. If the share price is
90p then 25% of the options may be exercised, 110p a further 25% may be exercised, 130p then a further 25% may be exercised and 150p the
remaining 25% may be exercised.
2 These options were granted under the 2000 Executive Share Option Scheme (Unapproved Ordinary). A performance criteria has been set making
the exercise of the option conditional on the middle market quotation of The Evolution Group Plc share price increasing by an average of 50%
above the relevant exercise price over a period of 30 dealing days since the date of the grant.
3 These options were granted under the 2000 Executive Share Option Scheme (Unapproved Super). No performance criteria are attached to the
exercise of these options.
4 These options were granted outside of any share scheme. No performance criteria are attached to the exercise of these options.
5 These options were granted under the Beeson Gregory Group Executive Share Incentive Scheme 1996. No performance criteria were attached 
to the exercise of these options.  6 These options were granted under the Beeson Gregory Group Deferred Bonus Plan. No performance criteria are attached to the exercise of these options.
7 These options were granted under the Beeson Gregory Group Replacement Options Agreement. No performance criteria were attached to the
exercise of these options. 
8 These options were granted under the 2002 Executive Share Incentive Plan. No performance criteria are attached to the exercise of these
options. This award is immediately exercisable but Mr Snow is restricted from selling any shares acquired until the announcement of the interim
results for the period to 30 June 2004.
9 These options were granted under the 2002 Executive Share Incentive Plan. The options are granted subject to performance criteria in respect of
the Group’s adjusted earnings per share (based upon the adjusted operating profit figure divided by the weighted average number of shares) for
the full years in 2004 and 2005. To fully vest the Group’s adjusted earnings per share will need to grow by 15% per annum over the annualised
level achieved in the first half of 2003 of 1.34p. This will be confirmed at the time of the announcement of the Group’s results for these periods
in April 2005 and April 2006 respectively. This measure has been chosen as it best reflects the Group’s target for growth appropriate to the
sector, market conditions in which the Group operates, and is therefore appropriately aligned with shareholders’ interests. 
10 These options were cancelled during the year.
11 These options were granted under the 2001 Executive Share Option Scheme at an exercise price of 41.4p. This award was made in respect of
historic performance and partly in recognition of the cancellation of the previous award. No performance criteria are attached to the exercise 
of these options. 
12 These options were granted under the 2002 Executive Share Incentive Plan. This award was made in respect of historic performance.
No performance criteria are attached to the exercise of these options.
For further details of share schemes across the Group, see note 43 to the financial statements. All the above Beeson
Gregory Group schemes are now closed.
Directors’ interests in ordinary shares of The Evolution Group Plc 
The directors in office at the year end had interests in the ordinary share capital of the Company (all of which were
beneficial) as shown below:
1 January 31 December
2003 2003
Richard Griffiths 5,428,675 5,835,000
Alex Snow 429,102 429,102
Graeme Dell 12,820 47,820
David Norwood 3,803,194 3,070,552
Sir Malcolm Field 11,799 11,799
George Loudon 18,350 18,350
Oliver Vaughan 384,961 399,019
Sir Malcolm Field Chairman of the Remuneration Committee
30 March 2004
the evolution group plc
29
Report & Accounts 2003 Independent Auditors’ Report
30
the evolution group plc
Report & Accounts 2003
Independent Auditors’ Report to the Members of The Evolution Group Plc
We have audited the financial statements on pages 32 to 72 which comprise the profit and loss account, the balance
sheets, the cash flow statement and the related notes which have been prepared under the historical cost convention as
modified by the revaluation of certain assets and the accounting policies set out on pages 36 to 39. We have also audited
the disclosures required by Part 3 of Schedule 7A to the Companies Act 1985 contained in the directors’ remuneration
report (‘the auditable part’).
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. The directors are
also responsible for preparing the directors’ remuneration report.
Our responsibility is to audit the financial statements and auditable part of the directors’ remuneration report in accordance
with 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 whether the financial
statements and the auditable part of the directors’ remuneration report have been properly prepared in accordance with
the Companies Act 1985. We also report to you if, in our opinion, the Directors' Report is not consistent with the financial
statements, if the Company and the Group have 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 the Chairman's Statement, the Chief Executive’s Report, the Financial Review, the outline of the Board, the
Directors’ Report, the unaudited part of the directors’ remuneration report and the corporate governance statement.
We review whether the corporate governance statement reflects the Company's compliance with the seven provisions of the
Combined Code issued in June 1998, specified for our review by the Listing Rules of the Financial Services Authority, and we
report if it does not. We are not required to consider whether the board's statements on internal control cover all risks and
controls, or to form an opinion on the effectiveness of the Group's corporate governance procedures or its risk and control
procedures.
The maintenance and integrity of The Evolution Group Plc website is the responsibility of the directors; the work carried out
by us does not involve consideration of these matters and, accordingly, we 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. Basis of audit opinion
We conducted our audit in accordance with auditing standards issued by the Auditing Practices Board. An audit includes
examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements and the
auditable part of the directors’ remuneration report. 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 and Group’s circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered necessary
in order to provide us with sufficient evidence to give reasonable assurance that the financial statements and the auditable
part of the directors’ remuneration report 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 at 31 December
2003 and of the profit and cash flows of the Group for the year then ended;
• the financial statements have been properly prepared in accordance with the Companies Act 1985; and
• those parts of the directors’ remuneration report required by Part 3 of Schedule 7A to the Companies Act 1985 have
been properly prepared in accordance with the Companies Act 1985. 
PricewaterhouseCoopers LLP
Chartered Accountants and Registered Auditors
United Kingdom
30 March 2004
the evolution group plc
31
Report & Accounts 2003 Consolidated Profit & Loss Account
- for the year ended 31 December 2003
32
the evolution group plc
Report & Accounts 2003
Note 2003 2002
£’000 £’000
Operating income 2 40,751 15,760
Commissions payable (2,656) (1,631)
Gross profit 38,095 14,129
Administrative expenses:
Administrative expenses before impairment of goodwill (32,720) (18,361)
Impairment of goodwill – (10,865)
3 (32,720) (29,226)
Profit on sale of fixed asset investments 2,379 19
Profit on sale of current asset investments 99 –
Provision against fixed asset investments 18 (6,114) (9,712)
Group operating profit / (loss) 1,739 (24,790)
Share of associated undertakings operating loss (186) –
Total operating profit / (loss) 1,553 (24,790)
Profit on part sale of subsidiary 4 15,085 –
Interest receivable and similar income 5 1,156 1,035
Share of associated undertakings interest receivable 5 126 –
Interest payable and similar charges 6 (21) (15)
Profit / (loss) on ordinary activities before taxation 17,899 (23,770)
Tax on profit / (loss) on ordinary activities 9 (1,851) (117)
Profit / (loss) on ordinary activities after taxation 16,048 (23,887)
Minority interests – Equity 39 146 51
Profit / (loss) for the financial year 16,194 (23,836)
Dividends 10 (616) –
Retained profit / (loss) for the financial year 15,578 (23,836)
Basic earnings / (loss) per ordinary share 11 6.7p (13.7)p
Diluted earnings per share 11 6.3p –
All recognised gains and losses are included in the profit and loss account.  
There is no difference between the result disclosed in the profit and loss account and the result on a historical cost basis.
The notes on pages 36 to 72 form an integral part of these financial statements. Note 2003 2002
£’000 £’000
Fixed assets
Intangible assets 14 8,990 11,432
Investment in associated undertakings 16 25,525 –
Tangible assets 17 1,509 973
Investments 18 851 27,640
Own shares 19 492 484
37,367 40,529
Current assets
Debtors 20 28,171 18,721
Long trading positions 21 7,207 2,664
Investments 22 444 176
Cash at bank and in hand 23 53,705 31,988
89,527 53,49
Creditors: Amounts falling due within one year 24 (34,734) (17,706)
Net current assets 54,793 35,843
Total assets less current liabilities 92,160 76,372
Provisions for liabilities and charges 25 (227) (396)
Net assets 91,933 75,976
Capital and reserves
Called up share capital 26 2,478 2,404
Shares to be issued 27 – 508
Share premium account 28 25,739 23,892
Merger reserve 29 57,261 57,261
Profit and loss account 30 6,488 (12,053)
Total shareholders’ funds 37 91,966 72,012
Shareholders funds – Equity 91,966 72,012
Minority interests – Equity 38 (33) 3,964
Minority interests and shareholders’ funds 91,933 75,976
A statement of movement in shareholders’ funds is given in note 37.
The notes on pages 36 to 72 form an integral part of these financial statements.
The financial statements on pages 32 to 72 were approved by the Board of Directors on 30 March 2004.
Graeme Dell Finance Director
Alex Snow Chief Executive
Consolidated Balance Sheet
- as at 31 December 2003
the evolution group plc
33
Report & Accounts 2003 Company Balance Sheet
as at 31 December 2003
34
the evolution group plc
Report & Accounts 2003
Note 2003 2002
£’000 £’000
Fixed assets
Investments in subsidiary undertakings 15 94,353 63,846
Investment in associated undertaking 16 17,212 –
Investments 18 – 5,112
Own shares 19 492 –
112,057 68,958
Current assets
Debtors 20 8,449 1,574
Investments 22 292 –
Cash at bank and in hand 23 30,989 16,190
39,730 17,764
Creditors: Amounts falling due within one year 24 (68,098) (13,924)
Net current assets (28,368) 3,840
Net assets 83,689 72,798
Capital and reserves
Called up ordinary share capital 26 2,478 2,404
Shares to be issued 27 – 508
Share premium account 28 25,739 23,892
Merger reserve 29 51,230 51,230
Profit and loss account 30 4,242 (5,236)
Total equity shareholders’ funds 37 83,689 72,798
A statement of movement in shareholders’ funds is given in note 37.
The notes on pages 36 to 72 form an integral part of these financial statements.
The financial statements on pages 32 to 72 were approved by the Board of Directors on 30 March 2004.
Graeme Dell Finance Director
Alex Snow Chief Executive Consolidated Cash Flow Statement
- for the year ended 31 December 2003
the evolution group plc
35
Report & Accounts 2003
Note 2003 2003 2002 2002
£’000 £’000 £’000 £’000
Net cash inflow / (outflow) from 
operating activities 33 11,832 (3,688)
Returns on investments and 
servicing of finance
Interest received 1,159 1,009
Interest paid (13) (14)
Income from fixed asset investments 8 –
Net cash inflow from returns on
investments and servicing of finance 1,154 995
Taxation
Corporation tax paid (979) (295)
Capital expenditure and financial investments
Purchase of investments (2,649) (11,784)
Sale of investments 2,611 223
Purchase of tangible fixed assets (1,353) (262)
Net cash outflow from capital expenditure
and financial investments (1,391) (11,823)
Acquisitions and disposals
Part disposal of subsidiary 15,015 36
Costs of disposal (1,616) –
Purchase of subsidiaries – (3,167)
Net cash (disposed) / acquired with subsidiaries 36 (8,738) 14,205
Net cash inflow from acquisitions and disposals 4,661 11,074
Cash inflow / (outflow) before financing 15,277 (3,737)
Financing
Issue of ordinary share capital 1,413 32
Issue of shares to minorities 5,252 –
Expenses of share issue (225) (276)
Net cash inflow / (outflow) from financing 6,440 (244)
Increase / (decrease) in cash in the year 34 21,717 (3,981) Notes to the Financial statements
36
the evolution group plc
Report & Accounts 2003
1. ACCOUNTING POLICIES
Basis of preparation
The financial statements have been prepared on a going concern basis and in accordance with the applicable Accounting
Standards of the UK Accounting Standards Board and pronouncements of its Urgent Issues Task Force, under the historical
cost convention, as modified by the inclusion of trading positions at fair values. The movements in the fair value of trading
positions are included in the profit and loss account as described below. The Companies Act 1985 requires certain
movements in the fair value of trading positions to be taken to the revaluation reserve. In so far as the adopted treatment
of trading positions represents a departure from current statutory requirements, the directors consider this necessary for the
financial statements to show a true and fair view. The effects of this departure, which is consistent with industry practice,
have not been disclosed, since the company does not retain records on an historical cost basis, which would provide
reasonable quantification.
Basis of consolidation
The Group’s consolidated financial statements comprise the financial statements of the Company and its subsidiary
undertakings made up to 31 December 2003. Interests in associated undertakings are presented in accordance with
Financial Reporting Standard 9, Associates and joint ventures. An undertaking is regarded as a subsidiary undertaking if the
Group has control over its operating and financial policies.
In accordance with section 230(4) of the Companies Act 1985 Evolution Group Plc has taken advantage of the legal
dispensation not to present its own profit and loss account. The amount of the profit after taxation for the financial period
dealt with in the financial statements of the Company is disclosed in note 12.
Operating income
In the opinion of the directors, disclosure of turnover is most appropriately represented for the Company by operating
income, comprising profits from trading activities including dividend income on such trading positions and related foreign
exchange movements, and fees and commissions receivable from corporate finance and asset management activities. Fees
and commissions are recognised in the profit and loss account when the related services are performed and when
considered recoverable. Operating income also includes interest receivable on segregated client money accounts.
This represents an adaptation of the profit and loss account format laid down in Schedule 4 to the Companies Act 1985
due to the special nature of the Company’s business. 
All operating income is generated in the United Kingdom and Ireland and is principally in sterling and is stated exclusive of
value added tax.
Trading positions
As noted above, proprietary trading and market making positions are stated at market value and profits and losses arising
from this valuation are taken to the profit and loss account.  
Tangible fixed assets
Tangible fixed assets are stated at historical cost less provision for any impairment in their values and are written down to
their estimated residual values over their expected useful economic lives as follows:
Leasehold improvements Over 5 years
Computers, software and similar equipment Over 3 to 5 years
Fixtures and fittings and other equipment Over 3 to 5 years Goodwill
Goodwill arises under the acquisition method of accounting for business combinations and represents the excess of cost
over fair value of the Group’s share of net assets acquired. In accordance with Financial Reporting Standard 10, goodwill is
capitalised as an intangible asset and amortised over its useful economic life. The useful economic life of the goodwill is
determined at the time of the acquisition giving rise to it by considering the nature of the acquired business, the economic
environment in which it operates and the period of time over which the value of the business is expected to exceed the
value of the identifiable net assets. 
For acquisitions, goodwill is generally expected to have a maximum useful economic life of twenty years and is subject to
regular impairment reviews.
Impairment of tangible fixed assets and goodwill
Tangible fixed assets and goodwill are subject to an impairment review in accordance with Financial Reporting Standard 11
if there are events or changes in circumstances that indicate that the carrying amount of the fixed asset or goodwill may
not be fully recoverable. The impairment review comprises a comparison of the carrying amount of the fixed asset or
goodwill with its recoverable amount, which is the higher of net realisable value and value in use. 
The carrying values of fixed assets and goodwill are written down by the amount of any impairment and this loss is
recognised in the profit and loss account in the period in which it occurs.
Fixed asset investments
Fixed asset investments represent equity investments.  Listed and unlisted investments are stated at historical cost less
provision for impairment in value, and are held for long-term investment purposes.
The Companies Act 1985 requires investments where there is significant influence to be treated as associated undertakings
and to be accounted for using the equity method of accounting.
The directors consider that in general the Group’s fixed asset investments do not come within the Companies Act 1985
definition of associated undertakings, since The Evolution Group Plc does not exercise significant influence over the
operating and financial policies of investees.  
The directors consider that as these investments are held as part of the Group’s portfolio with a view to the ultimate
realisation of capital gains, equity accounting would not give a true and fair view of the Group’s interest in these
investments.  The treatment adopted is in accordance with the accounting for venture capital and investment trusts as set
out in Financial Reporting Standard 9, Associates and Joint Ventures.
The Company and Group do not have any other significant interests in fixed asset investments as at 31 December 2003.
Investment in associated undertaking
Following the disposal of shares in IP2IPO in October 2003 this company is treated as an associated undertaking in the
Company and carried at cost less impairment. In the Group accounts associates are equity accounted in accordance with
Financial Reporting Standard 9.  
the evolution group plc
37
Report & Accounts 2003 Notes to the Financial statements
38
the evolution group plc
Report & Accounts 2003
Fixed asset investment impairment provisions
Provisions for fixed asset investments have been calculated in accordance with British Venture Capital Association (“BVCA”)
guidelines issued in August 2003. Early stage investments are valued at cost less any provision considered necessary due to
performance significantly below the expectation on which the investment was based. These provisions are made as a
percentage of cost in 25% bands. Later stage investments continue to be valued at cost less provision until a third party
valuation or earnings multiple basis becomes more applicable. Listed investments are valued at the bid price but may be
discounted further where the holding is significant in relation to the issued share capital.
Current asset investments
Current asset investments are held at the lower of cost and net realisable value.
In the Group’s financial statements, investments in associated undertakings are accounted for under the equity method. 
The consolidated profit and loss account includes the Group’s share of this associated undertaking’s losses and the Group’s
share of net assets, excluding goodwill which is written off against reserves, of the associated undertaking is shown in the
consolidated balance sheet.
Own shares
Shares in the Company held by the Share Incentive Trust which are not allocated to specific employees are held as fixed
assets at cost less a provision for impairment in value if appropriate, in accordance with Abstract 13 issued by the Urgent
Issues Task Force of the Accounting Standards Board.
Cash balances held with the Share Incentive Trust to purchase shares in the Company are held at the value advanced and
included within cash in the balance sheet.
For the years ending 31 December 2004 onwards, UITF Abstract 13 will be replaced by UITF Abstract 38, Accounting for
ESOP Trusts, and the amendments to UITF Abstract 17, Employee Share Schemes, will be adopted to reflect the change in
the value attributed to share awards. The consideration paid for own shares will be deducted in arriving at shareholders’
funds rather than being shown as the Company’s assets. These changes in accounting policy will result in a prior year
adjustment on the value attributed to share awards. 
Accounting for share options
Share options issued under employee share schemes by the Group are accounted for in accordance with UITF Abstract 17,
Employee Share Schemes. The intrinsic value of the options at the date an award is granted is charged to the profit and loss
account between the date of grant and the earlier of the options vesting date and the performance period to which the
award relates. The credit entry for the charge is taken to profit and loss reserves.
Pension commitments
The Group makes defined contributions to employees' approved personal pension plans, and the costs of these are
expensed when they are incurred.
Market and client balances
In accordance with market practice, unsettled bought and sold security transactions with clients, stock exchange member
firms and settlement offices are included gross in debtors and creditors respectively.
Operating leases
Rentals applicable to operating leases where substantially all the benefits and risk of ownership remain with the lessor are
charged to the profit and loss account on a straight line basis over the lease term. Investments in subsidiary undertakings
Investments in subsidiary undertakings are stated at historical cost less a provision for any impairment in their value. Details
of the principal subsidiary undertakings are given in note 40.
Non credit risk provisions
Provisions are recognised for present obligations arising as consequences of past events where it is probable that a transfer
of economic benefit will be necessary to settle the obligation and it can be reliably estimated.
Contingent liabilities are possible obligations whose existence will be confirmed only by uncertain future events or present
obligation where the transfer of economic benefit is uncertain or cannot be reliably measured. Contingent liabilities are not
recognised, however, they are disclosed unless remote.
Client money
Money held on behalf of clients (other than that required to settle outstanding bargains) by the Group, in accordance with
the Client Money Rules of The Financial Services Authority, and the corresponding liabilities, are not shown on the face of
the balance sheet as the Group is not beneficially entitled thereto.
Foreign currency balances
Foreign currency balances in the balance sheet are translated at the prevailing closing rate with the resulting gain or loss
taken to the profit and loss account. Profit and loss transactions are translated at the actual or average rate.
Deferred tax
Deferred tax is accounted for under Financial Reporting Standard 19, Deferred Tax (FRS 19). This standard addresses the
recognition of deferred tax assets and liabilities arising from timing differences between the recognition of gains and losses
in the financial statements and their recognition in the tax computations.
Deferred tax, provided at anticipated tax rates and on a non-discounted basis, is recognised in respect of all timing
differences, arising from transactions or events that result in an obligation to pay more tax in the future, or a right to pay
less tax in the future, which have occurred at the balance sheet date. Assets are recognised on this basis only to the extent
that it is regarded as more likely than not that they will crystallise in the future.
Dilapidation provision
The Group accrues costs for dilapidations on its head office lease over the period of the property lease. The accrual is based
on expected costs to be incurred at the end of the lease period to bring the building back into a suitable state.
2. OPERATING INCOME
2003 2002
£’000 £’000
Corporate finance 17,272 4,489
Sales commissions 9,067 5,913
Trading 10,994 2,196
Management fees 2,851 2,748
Other income 567 414
40,751 15,760
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3. ADMINISTRATIVE EXPENSES
2003 2002
£’000 £’000
Administrative expenses – staff costs
Wages and salaries 15,623 7,887
Social security costs 2,323 615
Other pension costs 290 234
Other staff costs 3,012 624
Total administrative expenses – staff costs 21,248 9,360
Administrative expenses – other
Depreciation – owned assets 774 623
Amortisation of goodwill 567 243
Amortisation of investment acquisition expenses 14 9
Write down of tangible fixed assets – 167
Operating lease charges – cars 22 37
Operating lease charges – leasehold property 691 494
Legal costs 418 289
Direct dealing costs 1,601 2,086
Other administrative expenses 7,385 5,053
Total administrative expenses – other 11,472 9,001
Administrative expenses before impairment of goodwill 32,720 18,361
Administrative expenses – impairment of goodwill – 10,865
Administrative expenses – total 32,720 29,226
Included within staff costs is an exceptional amount of  £295,000 (2002: £953,000) relating to restructuring charges
incurred during the year.
Included within other staff costs is an amount of £2,963,000 (2002: £166,000) relating to the cost of options.
Included within legal costs is an amount of £31,000 (2002: £nil) relating to restructuring costs not expected to recur.
Included within other administrative expenses is an exceptional amount of £787,000 (2002: £108,000) relating to
restructuring costs not expected to recur. 
The charge of £10,865,000 against goodwill in the prior year followed an impairment review of the value of the investment
in Beeson Gregory Group Limited made in 2002.  The fees paid to the main auditors are summarised in the table below:
2003 2002
£’000 £’000
Audit services
- statutory audit 175 152
- audit-related regulatory reporting 30 28
Further assurance services
- transaction services 255 458
- liquidation support 21 42
Tax services
- compliance services 91 80
- advisory services 26 80
598 840
The figures shown in the above table include amounts paid to PricewaterhouseCoopers LLP and also PricewaterhouseCoopers
in previous years. 
Transaction support services includes due diligence related to transactions and accounting consultations and audits in
connection with transactions.
Taxation services include compliance services such as tax return preparation and advisory services such as consultation on tax
matters, tax advice relating to transactions and other tax planning and advice.
Fees relating to the audit of the Company were £53,000 (2002: £41,500).
4. PROFIT ON PARTIAL DISPOSAL OF SUBSIDIARY
On 15 October 2003, the Group sold 5,460,000 shares in IP2IPO Group Plc (formerly IP2IPO Group Limited) following its
admission to AIM. This resulted in the Group’s holding falling to 40.61% of the issued share capital of IP2IPO Group and
the change in treatment from a subsidiary to an associate. The remaining investment in IP2IPO Group has been treated as
an associated undertaking. 
2003
£’000
Gain on part disposal of subsidiary net tangible assets 17,682
Goodwill disposed of (note 14) (981)
Disposal expenses (fees and charges: £126,000; special bonus award: £1,490,000) (1,616)
Profit on part disposal of subsidiary 15,085
The gain on this disposal is exempt from tax under substantial shareholdings relief as approved by the Inland Revenue.
For further details refer to note 37.
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5. INTEREST RECEIVABLE AND SIMILAR INCOME
2003 2002
£’000 £’000
Interest receivable from bank 1,156 1,035
Share of associate’s interest receivable 126 -
6. INTEREST PAYABLE AND SIMILAR CHARGES
2003 2002
£’000 £’000
Interest payable 21 15
Interest is paid on overdrawn balances with clearing or settlement institutions.
7. EMPLOYEES
The average number of employees during the year was as follows:
2003 2002
Group
Investment banking 84 65
Stockbroking and fund management 62 54
Group activities 7 6
153 125
The actual number of full time employees was 163 at 31 December 2003 (2002: 153).  
The average number of employees within IP2IPO whilst it was a subsidiary was 6 (2002: 4). 8. DIRECTORS’ EMOLUMENTS
The aggregate emoluments of the directors of the Company computed in accordance with Schedule 6 of the Companies
Act 1985 are shown below. 
The highest paid director had aggregate emoluments of £1,482,000 (2002:  £234,000).
Other pension costs relate to amounts paid or accrued under money purchase pension schemes. No director accrued
benefits under money purchase pension schemes during the year (2002: 1).
2003 2002
£’000 £’000
Remuneration in respect of Directors:
Aggregate emoluments 4,030 815
Other pension costs – 6
Gains made on exercise of share options 569 -
Termination payments for the loss of office 79 -
4,678 821
An analysis of all directors’ remuneration may be found in the Remuneration Report on pages 24 to 29.
9. TAXATION
2003 2002
£’000 £’000
Current tax:
Corporation tax 2,123 34
Adjustments in respect of prior years (135) –
Current year tax charge 1,988 34
Deferred tax:
Current year movement (137) 83
Tax on profit / (loss) on ordinary activities 1,851 117
The tax assessed for the year is lower than the standard rate of corporation tax in the UK (30%).  
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9. TAXATION (continued)
Factors affecting the current tax charge for the year are explained below:
2003 2002
£’000 £’000
Profit / (loss) on ordinary activities before tax 17,899 (23,770)
Profit / (loss) on ordinary activities multiplied by the standard rate of corporation tax 
in the UK of 30% (2002: 30%) 5,370 (7,131)
Effects of:
Expenses not deductible for tax purposes 640 3,046
Items to be charged under capital items (3,112) –
Losses not recognised for deferred tax – 4,073
Utilisation of losses brought forward/unrecognised deferred tax asset (669) –
Non taxable income (119) (6)
Capital allowances for year in excess of depreciation 13 52
Adjustments in respect of prior years (135) –
Current tax charge for the year 1,988 34
There is a potential deferred tax asset at 31 December 2003 of £12,170,000 (2002: £14,500,000), relating to timing
differences arising on capital allowances, provisions against investments and trading losses carried forward. This asset has
not been recognised in the accounts due to current uncertainties as to how the Group will utilise the reversal of the
underlying timing differences.
The deferred tax asset would be recovered if there were future taxable profits from which the reversal of the underlying
timing differences could be deducted.
There is no tax charge on the profit arising on the part disposal of shares in IP2IPO of £15,085,000 as this is an exempt
item under substantial shareholding relief as approved by the Inland Revenue.
10. DIVIDENDS
2003 2002
£’000 £’000
Final proposed: 0.25p (2002: Nil) per 1p share 616 –
Dividends amounting to £3,453 (2002: Nil) in respect of the Company’s shares held by an employee share trust have been
waived and accordingly deducted in arriving at the aggregate dividends proposed. 11. EARNINGS PER ORDINARY SHARE
The calculation of the basic earnings per ordinary share is based on the profit on ordinary activities after tax and on the
weighted average number of ordinary shares in issue during the year. The calculation of the diluted earnings per share is based
on the basic earnings per share adjusted to allow for the issue of shares on the assumed conversion of all dilutive options.
Year ended 31 December 2003 Year ended 31 December 2002
Profit Weighted Earnings Loss Weighted Loss per
£’000 average no. per share (p) £’000 average no. share (p)
Basic earnings / (loss) per share 16,194 242,953,440 6.7 (23,836) 174,598,980 (13.7)
Dilutive effect of securities – 12,380,589 – –––
Diluted earnings per share 16,194 255,334,029 6.3 –––
In accordance with Financial Reporting Standard 14, Earnings Per Share a diluted loss per share has not been calculated for
the prior year, as the dilutive effect of options would result in a more favourable loss per share from the table above.
12. PROFIT FOR THE FINANCIAL YEAR
As permitted by section 230 of the Companies Act 1985, the Company’s profit and loss account has not been included in
these financial statements. The Company’s profit for the financial year was £7,157,000 (2002: loss £24,512,000).
13. SEGMENTAL ANALYSIS
2003 2002
Operating Profit / (loss) Net Operating Profit / (loss) Net
income before tax assets income before tax assets
£’000 £’000 £’000 £’000 £’000 £’000
Group
Investment banking 32,126 9,584 28,938 8,835 (1,354) 22,291
Stockbroking and fund management 8,327 193 2,478 6,644 243 2,727
Other activities 215 8,616 34,992 281 (22,332) 23,686
IP2IPO 83 (434) – – (327) 27,272
40,751 17,959 66,408 15,760 (23,770) 75,976
Associates
IP2IPO 56 (60) 25,525 –––
40,807 17,899 91,933 15,760 (23,770) 75,976
The segmental analysis follows the business lines described in the Chief Executive’s Report and Financial Review on pages 
4 to 12.
Investment banking in the current year refers to the business carried out in Evolution Beeson Gregory Limited. The 2002
comparative included investment banking operations in other Group companies prior to the acquisition of Evolution Beeson
Gregory Limited in July 2002.
Stockbroking refers to Private Client Stockbroking and Fund Management under the Christows brand.  
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13. SEGMENTAL ANALYSIS (continued)
Other activities refer to the central administrative, shared services and holding company functions, combined with the
profits on, and provisions against, the legacy fixed asset investment portfolio. In addition, the results of Evolution Securities
China Limited are included as they are not material in this, its first period of operation after the business commenced in
August 2003.
IP2IPO refers to the business carried out in the Intellectual Property commercialisation field under the IP2IPO group of
companies. This segment was treated as a subsidiary undertaking until 15 October 2003 and thereafter as an associated
undertaking with a holding of 40.61%.
The Group’s operations are substantially based in the United Kingdom and therefore no geographical analysis has been
disclosed.
14. INTANGIBLE FIXED ASSETS
Goodwill
£’000
Cost
At 1 January 2003 11,675
Part disposal of subsidiary (1,037)
Transferred to associated undertakings (963)
At 31 December 2003 9,675
Amortisation
At 1 January 2003 243
Part disposal of subsidiary (56)
Transferred to associated undertakings (57)
Charge for the year 555
At 31 December 2003 685
Net book value
At 31 December 2003 8,990
At 31 December 2002 11,432
The goodwill arose on the acquisition of the Beeson Gregory Group on 11 July 2002. The directors consider that the
goodwill has a useful economic life of 20 years.
An amount of £981,000 represents the goodwill disposed of relating to the deemed and actual disposals of the IP2IPO
Group during 2003, acquired as part of the Beeson Gregory Group in 2002 (for further details refer to note 36). 15. INVESTMENTS IN SUBSIDIARY UNDERTAKINGS 
Company £’000
Cost
At 1 January 2003 86,233
Additions 498
Transfers from other Group companies 47,570
Reclassification to investment in associated undertaking (17,212)
At 31 December 2003 117,089
Provision for impairment
At 1 January 2003 22,387
Charge for the year -
Transfers from other Group companies 349
At 31 December 2003 22,736
Net book value
At 31 December 2003 94,353
At 31 December 2002 63,846
Details of significant investments in subsidiaries are given in note 40.
Additions
On 18 August 2003 the Company acquired 75.01% of the issued ordinary shares and 100% of the issued preference shares
in Evolution Securities China Limited (a company incorporated in the UK on 18 July 2003) for a total consideration of
£498,000.
Transfers
On 18 August 2003 investments in the subsidiary companies: Evolution Beeson Gregory Limited; IP2IPO Group Plc; and
Beeson Gregory Investment Management Limited held by another Group subsidiary were transferred at net book value to
the Company.
Disposals
The Company disposed of 5,460,000 shares in IP2IPO Group following its admission to AIM on 15 October 2003. As a
result of this and the issue of new equity in IP2IPO the Company’s shareholding in IP2IPO fell from 84.40% as at 1 January
2003 to 40.61% as at 31 December 2003. This investment was treated as a subsidiary until 15 October 2003 and
thereafter as an associated undertaking as is disclosed in note 16.
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16. INVESTMENT IN ASSOCIATED UNDERTAKINGS
(i) Group £’000
At 1 January 2003 –
Share of net assets 24,691
Goodwill 894
Share of associated undertaking’s losses on ordinary activities (60)
At 31 December 2003 25,525
The investment in associated undertaking, IP2IPO Group Plc, represents 40.61% of its ordinary 10p shares. IP2IPO’s business
is the commercialisation of intellectual property (“IP”) through the formation of long-term university partnerships. This
company has developed a unique business model allowing it to enter into long-dated agreements with universities under
which it acquires a significant interest in the IP that they create, and to work with its university partners to commercialise
this IP.
The following table shows the share of the Group’s profit and loss and net assets as at 31 December 2003:
£’000
Operating income 56
Loss on ordinary activities before taxation (60)
Taxation –
Loss on ordinary activities after taxation (60)
Fixed assets 9,502
Current assets 15,599
Creditors: amounts falling due within one year (314)
Creditors: amounts falling due after one year (156)
Net Assets 24,631
The goodwill associated with IP2IPO is shown below:
Goodwill
£’000
Cost
At 1 January 2003 –
Transferred from subsidiary undertaking 963
At 31 December 2003 963
Amortisation
At 1 January 2003 –
Transferred from subsidiary undertaking (57)
Charge for the year (12)
At 31 December 2003 (69)
Net book value
At 31 December 2003 894
At 31 December 2002 – 16. INVESTMENT IN ASSOCIATED UNDERTAKINGS
(ii) Company £’000
Cost
At 1 January 2003 –
Transferred from subsidiary undertaking 17,212
At 31 December 2003 17,212
Net book value
At 31 December 2003 17,212
At 31 December 2002 –
The carrying value in the Company’s balance sheet represents the cost of the investment in IP2IPO as at 31 December 2003.
The market value of this investment at 31 December 2003 was £53,632,000.
17. TANGIBLE FIXED ASSETS
(i) Group
Leasehold Fixtures and Computer
improvements fittings equipment T otal
£’000 £’000 £’000 £’000
Cost
At 1 January 2003 504 993 2,267 3,764
Additions – 686 651 1,337
Disposed with subsidiaries – (19) (62) (81)
Reclassification (28) 28 – –
At 31 December 2003 476 1,688 2,856 5,020
Depreciation
At 1 January 2003 435 713 1,643 2,791
Charge for the year 17 224 533 774
Disposed with subsidiaries – (9) (45) (54)
At 31 December 2003 452 928 2,131 3,511
Net book values
At 31 December 2003 24 760 725 1,509
At 31 December 2002 69 280 624 973
(ii) Company
The Company does not own any tangible fixed assets.
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18. FIXED ASSET INVESTMENTS
(i) Group
Unlisted
Listed AIM listed IP2IPO Other unlised
investments investments Portfolio (a) investments Total
£’000 £’000 £’000 £’000 £’000
Cost
At 1 January 2003 1,407 9,647 21,589 22,978 55,621
Additions – 1,051 1,419 – 2,470
Disposals (1,407) (158) – (6,132) (7,697)
Investment in spin out companies – – 28 – 28
Transfer to listed investments – 952 – (952) –
Transfer to current asset investments – (292) – – (292)
Disposed with subsidiaries – – (23,036) – (23,036)
At 31 December 2003 – 11,200 – 15,894 27,094
Amortisation of costs
At 1 January 2003 – – 34 – 34
Charge for the year – – 14 – 14
Disposed with subsidiaries – – (48) – (48)
At 31 December 2003 –––––
Provisions
At 1 January 2003 1,038 4.456 650 21,803 27,947
Provided in the year – 6,163 – 63 6,226
Release of provision – (112) – – (112)
Disposals (1,038) – – (6,130) (7,168)
Transfer to listed investments – 614 – (614) –
Disposed with subsidiaries – – (650) – (650)
At 31 December 2003 – 11,121 – 15,122 26,243
Net book values
At 31 December 2003 – 79 – 772 851
At 31 December 2002 369 5,191 20,905 1,175 27,640
The aggregate market value at 31 December 2003 of listed investments was £nil (2002: £633,000).
The transfer to AIM listed investments represents the movement of unlisted investments to listed following admission to the
Official List or AIM in 2003.
AIM listed investments include stocks listed on similar overseas exchanges. 18. FIXED ASSET INVESTMENTS
(a) IP2IPO portfolio of invesments
The following table summarises the components of the IP2IPO portfolio up to the partial disposal of this subsidiary on 
15 October 2003: 
Oxford Oxford
University University Southampton Other
Chemistry Chemistry University university Acquisition
Investments spin outs spin outs spin outs costs Total
£’000 £’000 £’000 £’000 £’000 £’000
Cost
At 1 January 2003 17,806 2,091 520 888 284 21,589
Additions – – 1,282 51 85 1,418
Investment in spin out companies (550) 578––– 28
Disposed with subsidiaries (17,256) (2,669) (1,802) (939) (369) (23,035)
At 31 December 2003 ––––––
Amortisation of costs
At 1 January 2003 –––– 34 34
Charge for the year –––– 14 14
Disposed with subsidiaries –––– (48) (48)
At 31 December 2003 ––––––
Provisions
At 1 January 2003 – – – 650 – 650
Provided in the year ––––––
Disposed with subsidiaries – – – (650) – (650)
At 31 December 2003 ––––––
Net book values
At 31 December 2003 ––––––
At 31 December 2002 17,806 2,091 520 238 250 20,905
(b) Significant fixed asset investments
The Group does not hold any investments representing greater than 20% of the issued share capital in any company.
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18. FIXED ASSET INVESTMENTS (continued)
(ii) Company
£’000
Cost
At 1 January 2003 9,635
Intra Group transfers in 450
Intra Group transfers out (9,635)
Disposal (158)
Transfer to current asset investments (292)
At 31 December 2003 –
Provisions
At 1 January 2003 4,523
Intra Group transfers in 112
Release of provision (112)
Intra Group transfers out (4,523)
At 31 December 2003 –
Net book value
At 31 December 2003 –
At 31 December 2002 5,112
The Company did not hold any fixed asset investments at the end of the year. 19. OWN SHARES
(i) Group
£’000
Cost
At 1 January 2003 484
Additions 8
At 31 December 2003 492
Own shares comprise shares in The Evolution Group Plc, held by the Share Incentive Trust, which have not yet been
conditionally allocated to specific employees. The number and market value of shares held in the Share Incentive Trust are
disclosed below.
The Share Incentive Trust was established in 1996 by Beeson Gregory Group Limited to facilitate the granting of options
over fully paid shares to certain staff. The Trust held the following 1p ordinary shares in The Evolution Group Plc at 
31 December 2003:
2003 2002
Number Number
of shares of shares
Shares allocated to specific employees in respect of options issued 
and therefore not consolidated in these financial statements 520,777 1,692,368
Shares consolidated in these financial statements 860,267 799,668
1,381,044 2,492,036
Nominal value of 1p ordinary shares £13,810 £24,920
Market value at £1.015 per share (2002: £0.54) £1,401,760 £1,345,699
The market value represents the market price for an ordinary 1p share at 31 December 2003.
(ii) Company
£’000
Cost
At 1 January 2003 –
transfers 484
Additions 8
At 31 December 2003 492
Transfers represent the transfer in of shares not yet conditionally allocated to employees which were previously consolidated
within another Group subsidiary at the prior year end. Following the transfer of trust balances to the Company’s trust
administrator, these balances are now included within the Company’s balance sheet.
The number and market value of shares held in the Share Incentive Trust are disclosed under the Group in the table above.
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20. DEBTORS
Group Company
2003 2002 2003 2002
£’000 £’000 £’000 £’000
Amounts falling due within one year:
Trade debtors 3,270 1,551 – –
Counterparty debtors 22,990 15,441 – –
Amounts owed by Group undertakings – – 7,407 1,046
Amounts owed by associated undertakings 126 – – –
Deferred tax 54 – – –
Corporation tax recoverable – 187 – –
Other debtors 662 447 8 28
Prepayments and accrued income 1,069 1,095 34 –
28,171 18,721 7,449 1,074
Amounts falling due after more than one year:
Subordinated loan to Christows Limited – – 1,000 500
28,171 18,721 8,449 1,574
The subordinated loan, of £1,000,000 owed by Christows Limited, was drawn in two equal tranches on 9 September 2002
and 8 April 2003 respectively, and is repayable on the date specified by notice in writing by either party being not less than
two years after the date of which the notice is given. The loan is interest bearing at a rate equal to the base rate from time
to time.
Deferred 
tax asset
£’000
As at 1 January 2003 –
Credit to the profit and loss account 54
As at 31 December 2003 54
There is a deferred tax asset at 31 December 2003 of £54,000, relating entirely to accelerated capital allowances.
21. LONG TRADING POSITIONS
Group Company
2003 2002 2003 2002
£’000 £’000 £’000 £’000
Long positions in market-making and 
dealing operations at market value 6,860 2,664 – –
Long principal trading positions 347 – – –
7,207 2,664 – –
The long trading positions represent shares listed on both the Official List and AIM. Short trading positions are disclosed in
creditors in note 24. 22. CURRENT ASSET INVESTMENTS
(i) Group
2003 2002
£’000 £’000
Investments 444 176
The market value of investments on the Official List at 31 December 2003 was £221,000 (2002: £226,000). 
(ii) Company
2003 2002
£’000 £’000
Investments 292 –
The market value of investments on the Official List at 31 December 2003 was £nil (2002: £Nil). 
23. CASH AT BANK AND IN HAND
Cash at bank includes £1,384,000 (2002: £303,000) received in the course of settlement of client transactions which is held
in trust on behalf of clients, but may be utilised to settle outstanding transactions. It also includes cash of £212,000 held by
the Share Incentive Trust (2002: £316,000).
24. CREDITORS: amounts falling due within one year
Group Company
2003 2002 2003 2002
£’000 £’000 £’000 £’000
Trade creditors 947 585 – 9
Counterparty creditors 15,823 11,883 – –
Amounts due to Group undertakings – – 66,868 13,463
Corporation tax payable 838 16 – –
Other taxation and social security 769 928 – 21
Other creditors 3 74 1 1
Accruals and deferred income 11,245 2,796 613 430
Short trading positions 4,493 1,424 – –
Dividends payable 616 – 616 –
34,734 17,706 68,098 13,924
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25. PROVISIONS FOR LIABILITIES AND CHARGES
(i) Group
Litigation Dilapidation Deferred tax Total
£’000 £’000 £’000 £’000
As at 1 January 2003 113 200 83 396
Charge to profit and loss account 84 36 (83) 37
Transferred to current liabilities – (200) – (200)
Utilised during the year (6) – – (6)
As at 31 December 2003 191 36 – 227
Amounts have been provided in respect of various pending litigation against the Group. The Group has sought legal advice
and will continue to defend itself vigorously against these claims. The amounts provided represent anticipated costs which
the directors believe may be incurred in resolving these various legal matters.
Amounts provided in the prior year in respect of dilapidation costs for the previous offices of one of the Group’s subsidiary
undertakings have been transferred to current liabilities. The amount provided in respect of dilapidations in the current year
relates to the new offices of one of the Group’s subsidiary undertakings.
The deferred tax liability at 31 December 2002 related entirely to accelerated capital allowances.
(ii) Company
The Company has no provisions for liabilities and charges at year end (2002: £Nil).
26. SHARE CAPITAL
Company
2003 2002
£’000 £’000
Authorised:
400,000,000 ordinary shares of 1p each 4,000 4,000
Allotted, issued and fully paid:
247,847,332 ordinary shares of 1p each 2,478 2,404
The following table summarises the movements of allotted, issued and fully paid share capital during 2003:
Company
£’000
Allotted, issued and fully paid
At 1 January 2003 
240,362,721 ordinary shares of 1p each 2,404
Issues
7,484,611 ordinary shares on exercise of options (see below) 74
At 31 December 2003
247,847,332 ordinary shares of 1p each 2,478 26. SHARE CAPITAL
The following issues of the ordinary shares of 1p took place during the year:
(a) 643,251 on 15 January 2003 following the issue of 324,472 shares under The Evolution Group Plc Loyalty Bonus (Enhanced) at an exercise price of
70p, the exercise of 128,779 options under The Evolution Group Plc Executive Share Option Scheme 2000 at an exercise price of 10p, the exercise
of 40,000 options under the Ex Beeson Gregory Group Plc Replacement Option Agreements at an exercise price of 10.03p, and the exercise of
150,000 options under an individual share option agreement dated 14 December 2000 at an exercise price of 25p.
(b) 465,238 on 24 January 2003 following the exercise of 442,500 options under the Ex Beeson Gregory Group Plc Executive Share Incentive Scheme 1996 at
an exercise price of 28.25p and the issue of 22,738 shares to cover employers’ national insurance.
(c) 282,438 on 17 March 2003 following the exercise of 266,797 options under the Ex Beeson Gregory Group Plc Executive Share Incentive Scheme 1996 at
an exercise price of 28.25p and the issue of 15,641 shares to cover employers’ national insurance.
(d) 354,000 on 28 May 2003 following the exercise of options under the Ex Beeson Gregory Group Plc Executive Share Incentive Scheme 1996 at an
exercise price of 28.25p.
(e) 3,260,901 on 27 June 2003 following the exercise of 88,500 options under the Ex Beeson Gregory Group Plc Executive Share Option Scheme 1994
at an exercise price of 18.36p, the exercise of 400,351 options under the Ex Beeson Gregory Group Plc Executive Share Incentive Scheme 1996 at an
exercise price of 28.25p, and 2,772,050 options under the Ex Beeson Gregory Group Plc Replacement Option Agreements at an exercise price of 10.03p.
(f) 265,500 on 5 August 2003 following the exercise of options under the Ex Beeson Gregory Group Plc Executive Scheme 1996 at an exercise price of 28.25p.
(g) 939,346 on 9 September 2003 following the issue of 401,046 shares under The Evolution Group Plc Loyalty Bonus (Enhanced) at an exercise price
of 70p, the exercise of 336,300 options under the Ex Beeson Gregory Group Plc Executive Scheme 1996 at an exercise price of 28.25p, the exercise
of 25,000 options under the Evolution Group Plc Executive Share Scheme 2001 at an exercise price of 52.3p, and the exercise of 177,000 options
under the Ex Beeson Gregory Group Plc Executive Share Option Scheme 1994 at an exercise price of 18.36p.
(h) 184,371 on 23 September following the exercise of 159,371 options under the Ex Beeson Gregory Group Plc Executive Scheme 1996 at an exercise
price of 70.62p and the exercise of 25,000 options under the Evolution Group Plc Executive Share Scheme 2001 at an exercise price of 39.6p.
(i) 523,166 on 21 October 2003 following the exercise of 71,014 options under the Ex Beeson Gregory Group Plc Replacement Option Agreements at
an exercise price of 10.03p, the exercise of 377,152 options under the Ex Beeson Gregory Group Plc Executive Share Incentive Scheme 1996 at an
exercise price of 28.25p and the exercise of 75,000 options under an individual share option agreement dated 14 December 2000 at an exercise
price of 25p. These awards were issued under the Block Listing Arrangement agreed with the Listing Authority on 17 October 2003. 
(j) 38,500 on 29 October 2003 following the exercise of 38,500 options under the Ex Beeson Gregory Group Plc Executive Share Incentive Scheme 1996
at an exercise price of 28.25p. This award was issued under the Block Listing Arrangement agreed with the Listing Authority on 17 October 2003.
(k) 354,000 on 12 November 2003 following the exercise of 354,000 options under the Ex Beeson Gregory Group Plc Executive Share Incentive
Scheme 1996 at an exercise price of 28.25p. This award was issued under the Block Listing Arrangement agreed with the Listing Authority on 
17 October 2003.
(l) 173,900 on 20 November 2003 following the exercise of 88,500 options under the Ex Beeson Gregory Group Plc Executive Share Incentive Scheme
1996 at an exercise price of 28.25p, the exercise of 35,400 options under the Ex Beeson Gregory Group Plc Executive Share Incentive Scheme 1996
at an exercise price of 70.62p and the exercise of 50,000 options under the Evolution Group Plc Executive Share Scheme 2001 at an exercise price
of 39.6p.
Terms of share capital
Ordinary Shares of 1p
The holder of each share is entitled to one vote on a poll. The holders also have the right to receive dividends and the right
to participate on a return of capital.
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27. SHARES TO BE ISSUED
Company
2003 2002
£’000 £’000
Shares to be issued
725,518 ordinary shares of 1p each – 508
Shares to be issued relate to deferred consideration payable in shares to certain employees following the acquisition of the
Beeson Gregory Group in July 2002 and referred to as “The Enhanced Bonus” in the Offer Document to shareholders on 
13 June 2002. Shares were paid in two tranches in January and September 2003 as disclosed in note 26 (a) and (g). 
As announced in the offer document of 13 June 2002, shares to be issued were valued at 70p per share.
28. SHARE PREMIUM ACCOUNT
Company
£’000
At 1 January 2003 23,892
Issues of ordinary share capital 1,847
At 31 December 2003 25,739
29. MERGER RESERVE
Group
£’000
At 1 January and 31 December 2003 57,261
Company
At 1 January and 31 December 2003 51,230
The merger reserve within the Company arose on the acquisition of the Beeson Gregory Group on 11 July 2002 which 
was accounted for under acquisition accounting using merger relief under Section 131 of The Companies Act 1985. 
The adoption of this method resulted in the premium arising on the acquisition being taken to the merger reserve.
In addition to the above, within the Group, an additional merger reserve of £6,031,000 was created on the merger of 
The Evolution Group Plc and Christows Group Limited which took place in 2000. 30. PROFIT AND LOSS ACCOUNT RESERVE
Group
£’000
At 1 January 2003 (12,053)
Profit for the financial year 15,578
Share options 2,963
At 31 December 2003 6,488
Company
At 1 January 2003 (5,236)
Profit for the financial year 7,157
Share options 2,321
At 31 December 2003 4,242
31. CAPITAL COMMITMENTS AND CONTINGENCIES
Under the terms of agreements entered into by the Group’s associated undertaking, IP2IPO Group Plc, the Group’s share of
capital commitments in funds made available for investment purposes to universities with which it has entered partnership
agreements as at 31 December 2003 are:
• The University of Southampton of £1,366,527 over the remaining portion of the period of four years which
commenced in April 2002
• The University of York of £304,575 over the remaining portion of the period of three years which commenced in
October 2003
• King’s College London of £2,132,025 over the remaining portion of the period of five years which commenced in May
2003.
In 2002, when IP2IPO was treated as a subsidiary undertaking, the Group had capital commitments in funds made available
for investment purposes to universities of £4,480,000 and a contingent liability of £145,000 representing amounts to be
invested in university spin outs pending the meeting of certain investment milestones.
32. LEASE COMMITMENTS
The Group has operating lease commitments in respect of land and buildings of £722,000 (2002: £557,000) and of plant
and machinery of £10,000 (2002: £16,000). The leases to which these amounts relate expire as follows:
Plant and machinery Land and buildings
2003 2002 2003 2002
£’000 £’000 £’000 £’000
Within one year – 6 – 315
Within two to five years 10 10 189 178
After five years – – 533 64
10 16 722 557
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33. RECONCILIATION OF OPERATING PROFIT WITH NET CASH FLOW FROM OPERATING ACTIVITIES 
2003 2002
£’000 £’000
Operating profit / (loss) 1,553 (24,790)
Depreciation of tangible fixed assets 774 623
Amortisation of goodwill 581 252
Profit on sale of investments (2,478) (19)
Provisions against investments 6,114 9,712
Provisions for share options 2,963 166
Income from investments (8) –
Share of associated undertaking’s operating loss 186 –
Write down of tangible fixed assets – 167
Impairment of intangible fixed assets – 10,865
Increase in debtors (9,460) (933)
Increase / (decrease) in creditors 15,708 (658)
(Increase) / decrease in trading positions (4,213) 1,134
Increase in provisions for liabilities and charges 120 15
Increase in own shares (8) (222)
Net cash inflow / (outflow) from operating activities 11,832 (3,688)
34. RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS
2003 2002
£’000 £’000
Increase / (decrease) in cash in the year 21,717 (3,981)
Movement in net funds in the year 21,717 (3,981)
Net funds at the beginning of the year 31,988 35,969
Net funds at the end of the year 53,705 31,988
35. ANALYSIS OF MOVEMENTS IN CASH ATTRIBUTABLE TO SUBSIDIARY PRIOR TO PART DISPOSAL 
During the year the Group made a part disposal of its holding in IP2IPO Group Plc. This group was responsible for a net
operating cash outflow from the Group of £388,000, received £165,000 in respect of net returns on investments and
servicing of finance, paid £1,451,000 in respect of investments and capital expenditure and raised cash of £5,025,000
through the issue of ordinary shares.  36. PARTIAL DISPOSAL OF SUBSIDIARY
The Group reduced its stake in IP2IPO Group Plc on 15 October 2003 for a total consideration of £15,015,000. This brought
the Group’s holding in IP2IPO down to 40.61% from 54.04%. This followed the deemed disposal of the Group’s holding from
84.40% to 75.24% on 27 May 2003 following the issue of 3,906,250 shares by IP2IPO in which the Group acquired 625,000
shares at £1.60 per share, giving rise to a profit of £1,020,000, and the deemed disposal on 15 October 2003 of the Group’s
holding from 75.24% to 54.04% following the issue of 11,450,000 shares by IP2IPO at a price of £2.75 per share in which the
Group did not participate, giving rise to a profit of £9,135,000, and the successful flotation of IP2IPO on AIM.
The assets and liabilities at the date of disposal and the total consideration are set out in the following table:
Partial disposal of IP2IPO Group
£’000 £’000
i) Deemed disposal on 27 May 2003
Gain on part disposal of subsidiary 1,228
Goodwill disposed of (208)
Profit arising on deemed disposal 1,020
ii) Deemed disposal on 15 October 2003
Profit arising on deemed disposal 9,608
Goodwill disposed of (473)
Profit arising on deemed disposal 9,135
iii) Sale of shares on 15 October 2003
Group share of IP2IPO net assets before disposal (32,860)
Group share of net assets following disposal 24,691
Goodwill disposed of (300)
Sale proceeds 15,015
Profit arising on disposal 6,546
Total profit on disposals (i, ii, iii) 16,701
Disposal expenses (fees and charges: £126,000; 
special bonus award to directors and staff: £1,490,000) (1,616)
15,085
Net assets of IP2IPO at date of sale of shares
£’000
Tangible fixed assets 30
Fixed asset investments 22,339
Cash 38,639
Debtors 113
Creditors (316)
Net assets 60,805
The net cash balances leaving the Group as a result of the part disposal was £8,738,000. 
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37. RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS’ FUNDS
Group Company
2003 2002 2003 2002
£’000 £’000 £’000 £’000
Shareholders’ funds at 1 January 72,012 42,967 72,798 44,429
Profit / (loss) for the financial year 15,578 (23,836) 7,157 (24,512)
Issues of ordinary share capital 1,921 1,253 1,921 1,253
Shares to be issued (508) 508 (508) 508
Share options 2,963 166 2,321 166
Share capital reduction – share capital – (6,971) – (6,971)
Share capital reduction – share premium – (42,013) – (42,013)
Share capital reduction – profit & loss account reserve – 48,984 – 48,984
Costs of issue of share capital – (276) – (276)
Merger reserve – 51,230 – 51,230
Net increase in shareholders’ funds 19,954 29,045 10,891 28,369
Shareholders’ funds at 31 December 91,966 72,012 83,689 72,798
38. MINORITY INTEREST
£’000
At 1 January 2003 3,964
Additions 3
Deemed disposal of IP2IPO in May 2003 3,797
Deemed disposal of IP2IPO in October 2003 20,292
Charge for year on IP2IPO (110)
Charge for year on ESCL (36)
Part disposal of IP2IPO from subsidiary to associate (27,943)
At 31 December 2003 (33)
Additions relate to the establishment of Evolution Securities China Limited in August 2003, a UK registered company
specialising in investment banking services in Chinese equities, in which the Group holds a 75.01% stake.
Part disposal of subsidiaries relate to the deemed disposals and sale of IP2IPO following the issue of share capital by IP2IPO
in May 2003 and October 2003 (refer to note 37 for further details). The Group retains a 40.61% stake in IP2IPO Group Plc,
an intellectual property company. 39. FINANCIAL INSTRUMENTS
In the normal course of business, the Group uses certain financial instruments including cash, equity shares and fixed asset
investments and has no borrowings.
The Group’s cash and short term deposits (excluding amounts received in the course of settlement of client transactions and
held by the Share Incentive Trust) were as follows:
2003 2002
£’000 £’000
On short term deposit – 29,652
On current account 52,112 1,717
52,112 31,369
The notice period for short term deposits is one day.
The interest rate for short term deposits and current accounts is variable dependent on the rates offered by the Group’s
bankers.
Trading positions, current and fixed asset investments are funded by shareholders’ funds.
The Group entered into forward foreign exchange contracts to limit its exposure on foreign currency transactions involving
the settlement of foreign securities.
The Group has detailed policies and strategies in respect of these financial instruments, which seek to minimise the
associated risks.
The fair value for non-trading current asset investments have been disclosed in note 22. Long trading positions are carried
in the financial statements at fair value, as shown in note 21. Short trading positions are carried in the financial statements
at fair value and shown within creditors in note 24.
Risk Management Objectives
Through its normal operations, the Group is exposed to a number of risks, the most significant of which are liquidity,
currency and market risks.  The management of these risks is vested in the Board of Directors.
Management of Liquidity Risk
The Group seeks to manage liquidity risk, to ensure sufficient liquidity is available to meet foreseeable needs and to invest
cash assets safely and profitably. 
Management of Currency Risk
The Group takes out spot and forward rate contracts for foreign currency transactions to reduce currency risk exposure.
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39. FINANCIAL INSTRUMENTS (continued)
The Group’s long/(short) currency exposures, converted to sterling at year end rates, were as follows:
31 December 31 December
2003 2002
£’000 £’000
Euros 17 35
US Dollars 202 64
Other currencies 8 1
227 100
Currency exposures primarily comprise investment banking trading and counterparty positions, and bank balances. Currency
exposure is monitored daily by the Treasury manager, in order to keep it within appropriate limits and minimise risk
throughout the year.
Management of Market Risk
The Group is exposed to market risk in respect of its equity investments. These comprise (i) fixed asset investments, 
(ii) trading positions, which result from proprietary trading and market making activities, and (iii) current asset investments. 
(i) Fixed asset investments
The Board continues to review the performance of existing investments in the Evolution Capital Investment Limited portfolio,
including the provisioning process. Note 18 summarises fixed asset investments at the year end date and the disposals and
provisions made in the year. The impact on the year's results is also disclosed in note 13 (Segmental analysis of profit before tax).
(ii) Trading positions
Management of market risk in respect of trading positions is through a limit structure and active involvement of senior
management under the supervision of the Board of Directors.
The following table shows the highest, lowest and average long, short, gross and net positions during the year, together
with those at the year end; gross positions are defined as the absolute sum of long and short positions.  
Long Short Gross Net
Positions Positions Positions Positions
£’000 £’000 £’000 £’000
Highest positions 11,482 (5,146) 16,224 7,313
Lowest positions 2,700 (1,078) 3,849 245
Average positions 6,968 (3,521) 10,488 3,447
Positions at 31 December 2003 7,207 (4,493) 11,700 2,714
These amounts are calculated on a daily basis in line with the Group’s monitoring of trading position limits for market
making and principal trading.
The net gain included in the profit and loss account derived from trading in equity shares was £11.0 million (2002: £2.2 million)
(iii) Current asset investments
These comprise investments in listed and unlisted companies received in part payment for corporate finance services.
Performance is reviewed by management who will also decide when to realise investments. 40. PRINCIPAL SUBSIDIARY UNDERTAKINGS
Percentage Country of 
Business Owned Incorporation
Held directly by the Company
Evolution Beeson Gregory Limited Investment banking 100 UK
Christows Limited Stockbroking and fund management 100 UK
Evolution Group Services Limited Shared services 100 UK
Evolution Capital Investment Limited Investment company: Private Equity Portfolio 100 UK
Evolution Securities China Limited Investment banking 75 UK
Held by other Group companies
Christows Investments (Dublin) Limited Manager of open ended investment company 100 Ireland (Eire)
Shareholdings in the above subsidiaries are of ordinary equity shares. In accordance with S231 (5) of the Companies Act
1985, the above information is solely provided in relation to principal subsidiary undertakings. Full information is included
within the Annual Return.
41. POST BALANCE SHEET EVENTS
On 23 January 2004 certain employees were granted awards of ordinary shares under the Key Performers Share Incentive
Plan. These awards total 2,941,500 shares and will be subject to the performance of individuals over the 12 months from
issue. Up to 50% of this award, once made may be clawed back dependent upon the individual’s performance during the
12 months following the award, as measured within the Group company’s annual appraisal process. The level of subsequent
awards is also directly related to the individual’s overall performance rating within the company’s annual appraisal process.
In conjunction with the outlined individual performance elements, the basic scheme target is aggregate growth in earnings
(based upon the adjusted operating profit) of Evolution Beeson Gregory Limited of 15% per annum over the vesting period
of the award. Additionally, the satisfactory employment by the individual within a Group company throughout the period
following grant of an award is required. The price to be paid on exercise of these awards is the greater of £1 or the nominal
value of shares to be subscribed for. The awards may be exercised after three years from the date of grant.
42. RELATED PARTY TRANSACTIONS
The Company has taken advantage of the exemption under the provisions of Financial Reporting Standard 8, Related Party
Disclosures, not to disclose transactions or balances between group entities that have been eliminated on consolidation.
During the period from which IP2IPO was treated an associated undertaking to the year end, the Company charged
management fees for central administrative services totalling £17,000 inclusive of VAT (2002: £Nil). Amounts owing from
this associated undertaking as at 31 December 2003 were £153,000, representing amounts charged for the period up to
and from the date it became an associated undertaking.
During 2002, a director of the Company, Alex Snow, purchased a debenture at Twickenham for a term of 10 years. 
The debenture was paid for by the Group to the value of £26,000. The balance outstanding at 31 December 2003 was
£23,000. An agreement is in place that requires the remaining portion of the debenture to be repaid by the director should
he leave prior to the end of the ten year term. The debenture is used to facilitate the entertainment of clients.
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43. EMPLOYEE SHARE SCHEMES
The following table summarises the options in issue within the Group as at 31 December 2003
Options over new shares
At 1 Granted Exercised Cancelled At 31
Exercise January in the in the in the December
Scheme price (p) Status 2003 year year year 2003
EVG 2002 Executive
Share Incentive Plan 1.00 Unapproved 871,451 9,600,000 – (1,167,801) 9,303,650
EVG 2001 Executive
Share Option Plan 27.00-52.30 Unapproved Super 4,740,121 1,692,209 (100,000) (1,662,819) 4,669,511
EVG 2000 Executive
Share Option Scheme 10.00-67.00 Unapproved Ordinary 5,486,860 – (128,779) (869,459) 4,488,622
EVG 2000 Executive
Share Option Scheme 58.67 Unapproved Super 1,892,332 – – (826,700) 1,065,632
BGG 1994 
Share Option Scheme 18.36 Approved 265,500 – (265,500) – –
BGG 1996 Executive
Share Incentive Scheme 8.76-70.62 Approved 1,860,766 – (933,908) (572,631) 354,227
BGG 1996 Executive
Share Incentive Scheme 8.76-70.62 Unapproved 3,183,734 – (2,184,463) (436,198) 563,073
BGG Replacement
Option Agreements 10.03 Unapproved 2,883,064 – (2,883,064) – –
BGG 2000 Discretionary
Share Option Scheme 81.26-178.53 Approved 240,189 – – (87,000) 153,189
BGG 2000 Discretionary
Share Option Scheme 81.26-178.53 Unapproved 602,168 – – (219,353) 382,815
BGG Merger Share
Bonus 
(1)
– Unapproved 648,944 – (648,944) – –
Other options 25.00 Unapproved 800,000 – (225,000) – 575,000
23,475,129 11,292,209 (7,369,658) (5,841,961) 21,555,719
Options over existing shares held by the Share Incentive Trust
At 1 Granted Exercised Cancelled At 31
Exercise January in the in the in the December
Scheme price (p) Status 2003 year year year 2003
BGG 1996 Executive
Share Option Scheme 8.76-70.62 Approved 733,472 – (587,735) – 145,737
BGG 1996 Executive
Share Option Scheme 8.76-70.62 Unapproved 18,089 – (18,089) – –
BGG Deferred
Share Bonus Plan – Unapproved 545,035 – (147,651) (22,344) 375,040
BGG Conditional
Share Plan – Unapproved 395,772 – (354,000) (41,772) –
1,692,368 – (1,107,475) (64,116) 520,777
Notes:
(1)
The Merger Share Bonus represents a share award to retain certain Beeson Gregory Group staff following the acquisition by The Evolution Group
Plc on 11 July 2002, as referred to as “The Enhanced Bonus” in the offer document to shareholders on 13 June 2002.
(2)
In the above tables EVG refers to The Evolution Group Plc and BGG refers to the Beeson Gregory Group. The Group acquired the BGG share
schemes in its acquisition of Beeson Gregory Group on 11 July 2002. 43. EMPLOYEE SHARE SCHEMES
The Evolution Group Plc 2002 Executive Share Incentive Plan 
This plan was approved by the Board on 13 March 2002 and by shareholders on 10 October 2003.
Eligibility
Any director of the Company, or a Group company, and any employee of the Company, or a Group company, may be
invited to participate in the Plan.
Nature of Plan
The plan provides for participants to be awarded shares in the Company at their nominal cost. Subject to achievement of
performance criteria, awards of shares convert into call rights over such shares. The plan is operated in conjunction with an
employee benefit trust on two levels.
It is operated as a stand-alone plan and it is also used as the framework for the Key Performers Share Incentive Plan
(“KPSIP”) introduced for employees of Evolution Beeson Gregory Limited in January 2003 where it forms the method of
delivery of such awards made within the KPSIP framework. 
Performance criteria
• Stand-alone plan
Under the stand-alone plan the basic performance criteria used prior to the vesting of awards is growth in earnings of 15%
per annum over the vesting period of the award. Additionally, the satisfactory employment by the individual within a Group
company throughout the period following grant of an award is required. 
• KPSIP
Under the KPSIP, employees may be granted an initial award and two subsequent awards at the first and second anniversary
of the initial award. Up to 50% of each award, once made may be clawed back dependent upon the individual’s
performance during the 12 months following the award, as measured within the Group company’s annual appraisal
process.  The level of subsequent awards is also directly related to the individual’s overall performance rating within the
company’s annual appraisal process. In conjunction with the outlined individual performance elements, the basic scheme
target is aggregate growth in earnings (based upon the adjusted operating profit) of Evolution Beeson Gregory Limited of
15% per annum over the vesting period of the award. Additionally, the satisfactory employment by the individual within a
Group company throughout the period following grant of an award is required.
Call rights
After achievement of the performance criteria and vesting of the award, a call right is granted to the individual exercisable,
subject to continued satisfactory employment, within ten years of the date of the original award
Scheme Limits 
The number of shares which may be issued to satisfy awards under this plan is limited to 10% of the issued share capital of
the Company from time to time.
Options granted
At 31 December 2003, awards and call rights over 9,303,650 shares (2002: 871,451) were outstanding at an exercise 
price of the greater of £1 or the nominal value of the shares to be subscribed for. The call rights can be exercised between
14 November 2003 and 31 January 2013.
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43. EMPLOYEE SHARE SCHEMES 
The Evolution Group Plc 2001 Executive Share Option Scheme
This scheme was approved by shareholders on 21 June 2001.
Eligibility 
Any director who is required to devote the whole or substantially the whole of his working time to the service of the
Company, or a Group company, and any employee of the Company, or a Group company, may be invited to participate in
either Ordinary or Super options.
Option price
The exercise price shall be determined by the directors but shall not, unless approved by ordinary resolution of the
shareholders be less than the greater of nine-tenths of the market value of the share at the date of the grant and the
nominal value of a share.
Performance criteria
The option exercise may be conditional upon the performance of the Company and /or the participant over such period and
measured against such objective criteria as may be determined by the directors. The initial performance criteria established
by the Directors of the Company were that the closing bid price of a share in The Evolution Group Plc as derived from the
Daily Official List published by The London Stock Exchange must be not less on average than a specified amount for a
period of 60 consecutive days before options can be exercised. If the average share price is 90p, then 25% of the options
may be exercised; at 110p a further 25% may be exercised; at 130p then a further 25% may be exercised; and at 150p, 
the remaining 25% may be exercised. At a meeting of the Board on 21 November 2002, approval was given to the waiving
of these initial performance criteria for all new options granted under the scheme by varying the scheme rules. 
This recommendation was made by the Remuneration Committee, having made comparisons with the practice of other
groups and taken the appropriate legal advice.
Exercise of options
An option may not be exercised later than the tenth anniversary after the date of grant. The earliest date of exercise is
generally two years after the date of grant for Ordinary options and three years after the date of grant for Super options.
Scheme Limits 
The overall limit on the number of shares which may be issued to satisfy Ordinary options, is 10% of the issued share
capital and for Super options, is 5% of the issued share capital of the Company.
Options granted
At 31 December 2003 Nil Ordinary options (2002: Nil) and 4,669,511 Super options (2002: 4,740,121) were outstanding
with exercise prices between 27p and 52.3p. The options can be exercised between 30 June 2004 and 4 April 2013. 43. EMPLOYEE SHARE SCHEMES (continued)
The Evolution Group Plc 2000 Executive Share Option Scheme (Unapproved)
This scheme was approved by shareholders on 20 November 2000.
Eligibility
Any director of the Company, or a Group company, and any employee of the Company, or a Group company, may be
invited to participate in either Ordinary or Super options.
Option price
The exercise price shall be determined by the directors but shall not be less than the greater of the market value of the
share at the date of grant or the nominal value of a share.
Performance criteria
The option exercise on Ordinary options may be conditional upon the performance of the Company and /or the participant
over such period and measured against such objective criteria as may be determined by the directors. There are no
performance criteria for Super options.
Exercise of options
An option may not be exercised later than the tenth anniversary after the date of grant. The earliest date of exercise is
generally three years after the grant for Ordinary options and five years after the date of grant for Super options.
Scheme Limits 
The overall limit on the number of shares which may be issued to satisfy Ordinary options, is 10% of the issued share
capital and for Super options, is 5% of the issued share capital of the Company.
Options granted
At 31 December 2003 4,488,622 Ordinary options (2002: 5,486,860) and 1,065,632 Super options (2002: 1,892,332)
were outstanding with exercise prices between 10p and 67p. The options can be exercised between 16 January 2001 and
30 June 2011.
The Evolution Group Plc 2000 Executive Share Option Scheme (Approved)
The terms of this scheme are exactly the same as the Unapproved 2000 scheme save the restriction that no individual shall
be granted options over shares with an aggregate market value (calculated as the strike price at date of grant) exceeding
£30,000.
Options granted
At 31 December 2003 Nil Ordinary options (2002: Nil) and Nil Super options (2002: Nil) were outstanding.
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43. EMPLOYEE SHARE SCHEMES (continued)
The Beeson Gregory Group Share Option Scheme 1994 (Approved) 
(Closed for new awards) 
Eligibility
Any former director or employee of Beeson Gregory Group who was required to devote substantially the whole of their
working time to the affairs of the group. The Scheme is closed for new awards.
Option price
Existing options rolled over at acquisition were granted on 12 October 1998 and had a post rollover exercise price of 18.36p.
Performance criteria
There are no performance criteria attached to the exercise of these options.
Exercise of options
Subject to certain specific provisions, an option may only generally be exercised within the period commencing on the third
anniversary and ending on the tenth anniversary of the relevant allocation date.
Options granted
At 31 December 2003 Nil (2002: 265,500) options were outstanding.
The Beeson Gregory Group Executive Share Incentive Scheme 1996 (Approved and Unapproved)
(Closed for new awards) 
Eligibility
Any former director or employee of Beeson Gregory Group who was required to devote substantially the whole of their
working time to the affairs of the group. The Scheme is closed for new awards.
Option price
Existing options rolled over at acquisition were granted between 21 January 1997 and 7 March 2000 and have post rollover
exercise prices ranging from 8.76p to 70.62p.
Performance criteria
There are no performance criteria attached to the exercise of these options.
Exercise of options
Subject to certain specific provisions, an option may only generally be exercised within the period commencing on the third
anniversary and ending on the tenth anniversary of the relevant allocation date.
Options granted
At 31 December 2003 354,227 (2002: 1,860,766) approved options and 563,073 (2002: 3,183,734) unapproved options
were outstanding over new shares, with exercise prices between 8.76p and 70.62p. In addition 145,737 (2002: 733,472)
approved and Nil (2002: 18,089) unapproved options over existing shares were outstanding on the same terms as above.
The options can be exercised between 9 August 2002 and 7 March 2010. 43. EMPLOYEE SHARE SCHEMES 
The Beeson Gregory Group Discretionary Share Option Scheme 2000 (Approved and Unapproved)
(Closed for new awards) 
Eligibility
Any former director of Beeson Gregory Group who is required under their contract of employment to work for not less than
25 hours per week and other employees of the group. The Scheme is closed for new awards.
Option price
Existing options rolled over at acquisition were granted between 6 July 2000 and 25 June 2001 and have post rollover
exercise prices ranging from 81.26p to 178.53p.
Performance criteria
There are no performance criteria attached to the exercise of these options.
Exercise of options
Subject to certain specific provisions, an option may only generally be exercised within the period commencing on the third
anniversary and ending on the day prior to the tenth anniversary of the relevant date of grant.
Options granted
At 31 December 2003 153,189 (2002: 240,189) approved options and 382,815 (2002: 602,168) unapproved options were
outstanding with exercise prices between 81.26p and 178.53p. The options can be exercised between 9 August 2002 and
25 June 2011.
The Beeson Gregory Group Shares granted under Replacement Option Agreements (Unapproved)
(Closed for new awards) 
Eligibility
Former holders of options to subscribe for shares in the capital of Index IT Partnership Limited.
Option price
Existing options rolled over at acquisition were granted on 16 March 2000 and have a post rollover exercise price of 10.03p.
Performance criteria
There are no performance criteria attached to the exercise of these options.
Exercise of options
Options to exercise will lapse on 31 January 2004. 
Options granted
At 31 December 2003 Nil (2002: 2,883,064) unapproved options were outstanding. 
the evolution group plc
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Report & Accounts 2003 Notes to the Financial statements
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the evolution group plc
Report & Accounts 2003
43. EMPLOYEE SHARE SCHEMES (continued)
The Beeson Gregory Group Deferred Bonus Plan (Unapproved)
(Closed for new awards) 
Eligibility
Any former directors and employees of Beeson Gregory Group. The Plan is closed for new awards.
Option price
Existing awards rolled over at acquisition were granted on 19 April 2001 and have an exercise price of £1 in aggregate.
Performance Criteria
There are no performance criteria attached to the exercise of these options.
Exercise of options
Subject to certain specific provisions, an award may only generally be exercised within the period commencing on the third
anniversary and ending on the day prior to the tenth anniversary of the relevant date of grant.
Options granted under the Deferred Bonus Plan may only vest with employees three years after allocation, provided they
continue to be employed by the Group, and the cost of acquiring them is included within the bonus charge for the years in
respect of which they are granted.
At 31 December 2003 375,040 (2002: 545,035) options over existing shares were allocated. The options can be exercised
between 9 August 2002 and 18 April 2011.
The Beeson Gregory Group Merger Share Bonus Scheme (Unapproved)
Awards granted under the Merger Share Bonus Scheme to former Beeson Gregory Group employees vest in two equal
tranches on January 2003 and July 2003 following the acquisition of the Beeson Gregory Group on 11 July 2002. The
Scheme is closed for new awards
At 31 December 2003 Nil (2002: 648,944) options over existing shares were allocated. The options vested with employees
in January 2003 and July 2003.
Other Options
As at 31 December 2003 there were also the following options in issue which were outside any other option scheme:
Alex Snow and a former employee, Andrew Beaton were granted by the Company, on 14 December 2000, options to subscribe
for up to 500,000 ordinary shares and 300,000 ordinary shares respectively at 25p per share at any time between 14 December
2000 and 13 December 2005. Andrew Beaton exercised 150,000 options on 15 January 2003 and 75,000 on 8 October 2003.
At 31 December 2003 575,000 (2002: 800,000) options over existing shares were outstanding. 
The Beeson Gregory Group Conditional Share Plan (Unapproved)
(Closed for new awards) 
Awards were granted to three employees on 27 June 2001 and the Plan is closed for new awards. Awards may be exercised
from the second anniversary of the award date to the two year and six month anniversary of the date of grant at an
aggregate exercise price of £1.
At 31 December 2003 Nil (2002: 395,772) options over existing shares were allocated. Designed and produced by Best & Co. London. +44 (0)20 7440 8710 www.evolution-group.com
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