20660-04 03/10/2011 Proof 6
Animalcare Group plc
Annual Report 2011 
 
 
Stock code: ANCR
Developing and Supplying  
Veterinary Products for Companion Animals 20660-04 03/10/2011 Proof 6
Animalcare Group plc
Annual Report 2011
Animalcare Group plc is focused on growing its veterinary business.
Animalcare is a leading supplier of generic veterinary medicines and animal 
identification products to companion animal veterinary markets.
It develops and sells goods and services to veterinary professionals principally 
for use in companion animals; operating directly in the UK and through 
distribution and development partners in key markets in Western Europe.
Its principal product lines are licensed veterinary medicines and companion 
animal identification products and services.
Contents
Our Business
01   Highlights
02   Chairman’s Statement 
04   Chief Executive’s Review
06   Financial Review
Governance
08   The Board
09   Directors’ Report
12   Statement of Directors’ Responsibilities
13   Independent Auditors’ Report
Accounts 
14   Consolidated Statement of 
 Comprehensive Income
15   Statements of Changes in  
 Shareholders’ Equity
16   Balance Sheets
17   Cash Flow Statements
18   Notes to the Accounts
52   Officers and Professional Advisors www.animalcaregroup.co.uk
Stock code: ANCR
Our Business
01
20660-04 03/10/2011 Proof 6
Revenue 
— continuing operations 
£m
+5.4%
at £11.83m
09 10 11
11.83
11.22
9.70
Underlying profit before tax 
— continuing operations 
£m
+17.3%
at £3.05m
09 10 11
3.05
2.60
1.84
Underlying basic 
earnings per share 
pence
+5.4%
at 11.8p
09 10 11
11.8
11.2
7.2
Operational Highlights
● ● Sale of the Livestock Division with focus now fully on the Companion Animal Division
● ● Launch of four new generic veterinary products during the year
● ● New product development pipeline on track to deliver further new products as planned 
● ● Reorganisation of the structure of the UK sales force
Financial Highlights
Year Ended
June 2011 
Year Ended
June 2010
Revenue — continuing operations £11.83m £11.22m
Profit/(loss) for the year £2.33m (£1.03m)
Underlying* operating profit — continuing operations £3.05m £2.60m
Underlying* profit before tax — continuing operations £3.00m £2.48m
Underlying* profit for the year — continuing operations £2.29m £1.72m
Underlying* fully diluted earnings per share — continuing operations 11.2p 8.5p
Interim dividend paid 1.0p nil
Proposed final dividend 3.0p 3.0p
Cash and cash equivalents £1.18m £1.56m
Borrowings nil £4.46m
*  Underlying measures exclude, where applicable, amortisation of acquired intangibles, impairment of goodwill, fair value 
movements on interest hedging, impairments to current and non-current assets and other charges relating to Group 
reorganisation. Annual Report 2011
02
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Chairman’s Statement
Introduction
The Group has been operating for nearly a full year uniquely 
as a companion animal veterinary supplies business, having 
divested itself of the agricultural supplies businesses of 
Ritchey, Fearing and Travik in the first half of the financial 
year. This has allowed your Group to focus and concentrate 
all its resources on growing the more profitable and stable 
veterinary medicines and Identichip ranges. We can now 
plan for acceleration in the introduction of new licensed 
pharmaceutical products for our growing veterinary medicine 
portfolio. These divestures, combined with continued strong 
cash generation in the companion animal supplies business, 
means that your Group is debt free at the year end; indeed 
it had cash balances of c£1.2 million at 30 June 2011 as 
opposed to net debt of c£2.9 million at the previous year end.
Financial Trading
In a flat veterinary market our “new” Animalcare business 
achieved record sales, margins and profits during this 
financial year. Sales increased by approximately 5 per 
cent and margins by 1 per cent, whilst overheads were 
well controlled being 1 per cent lower than last year. This 
has meant fully diluted earnings per share from continuing 
operations have risen from 8.5p to 11.2p, a full 31 per cent. 
This is a good performance. Unlike previous years, there 
are few exceptional or other items during this financial year. 
The Company announced, in our pre-close trading update 
issued in July, that following an extended period of poor 
supplies performance that had already damaged sales in 
the 2010–11 financial year Recipharm, the supplier of one of 
our important veterinary medicines Buprecare, had closed 
their sterile production unit in the UK and had ceased supply 
with immediate effect from 30 June 2011. As we had already 
taken steps to introduce a new supplier, we expect that we 
will be reintroducing Buprecare to our range during the last 
quarter of the coming financial year. The expected loss of 
turnover at the time was estimated to be up to £450K for 
2011/2012. The Board is confident that once supplies are 
available again we can soon win back lost sales and market 
share and the temporary loss of supply will not have a long-
term financial effect on your business.
“In a flat veterinary market our ‘new’ 
Animalcare business achieved record 
sales, margins and profits during this 
financial year.” www.animalcaregroup.co.uk
Stock code: ANCR
Our Business
20660-04 03/10/2011 Proof 6
03
Dividend 
With the increase in cash and the underlying cash flow of 
your business, the Company paid its maiden interim dividend 
of 1.0 pence per share on 6 June 2011. With this in mind 
your Board is recommending a final dividend of 3.0 pence 
per share. This total dividend for the year of 4.0p 
(2010 — 3.0p) represents an annual increase of 33 per cent 
and is covered 2.9 times by earnings. The dividend is subject 
to shareholders’ approval at our Annual General Meeting to 
be held 28 October 2011 and is proposed to be paid on 
7 November 2011 to shareholders on the register on 
14 October 2011.
The Board
During the financial year Peter Warner joined the Board 
as Chief Financial Officer. Dr Iain Menneer, the Director of 
Marketing of Animalcare Limited, also joined the Board 
on 1 July 2011. I welcome them both as they will help to 
contribute to the growth of your business enormously. During 
the course of the year Geoff Rhodes, one of the original 
founders of the Ritchey business, resigned from his role as 
non-executive director. I wish to record the appreciation 
of the Board and my own personal thanks to Geoff for his 
service to the company over many years. It is intended that 
a new non-executive director with experience in life sciences 
businesses will join your Board this calendar year. On 
behalf of your Board I would like to thank all the employees, 
customers and suppliers that have helped make the financial 
year such a success.
Prospects
During the past financial year and now in the current 
one, there has been little or no growth in the veterinary 
medicines market in the UK. However, with the launch of 
several new veterinary drugs in the first quarter building 
on those introduced during the last financial year, and with 
the reintroduction of Buprecare, your Board believes that 
we will continue to grow the business markedly faster than 
the market overall and increase our market share. Trading 
in the year to date has started in line with your Board’s 
expectations.
James Lambert
Chairman Annual Report 2011
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Chief Executive’s Review
Introduction 
The past year has seen significant change in the structure 
of the Animalcare Group. After a careful strategic review we 
divested the Ritchey, Fearing and Travik businesses that 
comprised the old Livestock Division. As previously reported, 
the underlying reason for the sale of these businesses was 
the clear recognition that the time and resource required to 
revitalise the Livestock Division in a market sector that was 
showing few signs of sustainable, profitable growth could 
be better focussed and used in our rapidly growing and 
profitable Companion Animal Division. 
Our focus now is fully on the Companion Animal Division 
with its strategy of growth through the introduction of 
branded generic versions of selected veterinary medicines 
in key markets in Europe. This strategy is supported by 
the distribution in the UK of other professional goods and 
services to veterinary professionals where we have or can 
build a sustainable complementary product offering. The 
Companion Animal Identification and Infusion Accessories 
ranges are good examples of this approach.
Market Overview
The National Office of Animal Health, NOAH, the trade 
association which represents approximately 90 per cent of 
the distributors of veterinary medicines in the UK, in its latest 
published figures for the year ended March 2011 announced 
that the ex manufacturer sales, net of all discounts of 
all veterinary medicines, were flat at £467.2 million 
(2010 — £469.0 million) and 2.1 per cent up on 
2009 (£452.0 million). In comparison, sales of Animalcare 
veterinary medicines in the UK in the financial year grew by 
7.6 per cent. Sales of our established range of veterinary 
medicines in the UK grew by 5.6 per cent whilst UK sales of 
more recently launched generic veterinary medicines grew by 
22.7 per cent. This result is all the more pleasing in the light 
of the supply problems we had throughout the year with one 
of our key brands Buprecare. These supply problems 
ensured that we could not achieve the growth targets we set 
for the Buprecare brand in the UK but we endured a slight 
reduction in sales revenue of 2.1 per cent. A programme is in 
place to introduce an alternative supplier of Buprecare 
ampoule during the second half of the financial year.
Sales via our distribution network in Europe were 
4.0 per cent lower than the previous financial year. Although 
we experienced strong sales in some markets, notably 
Germany, this was offset by the loss of our distributor in 
Belgium and a particularly weak market in Spain. We are in 
discussions with an alternative distributor for our products in 
Belgium and will give our other European markets additional 
focus in the coming year.
“Sales of our established range of 
veterinary medicines in the UK grew by 
5.6% whilst UK sales of more recently 
launched generic veterinary medicines 
grew by 22.7%.” www.animalcaregroup.co.uk
Stock code: ANCR
Our Business
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20660-04 03/10/2011 Proof 6
Sales in the Companion Animal Identification products group 
were strong despite the market experiencing increased 
competitive pressure on prices. The amalgamated sales of 
all other product groups were ahead of expectations and 
overall market growth as our continued penetration with new 
veterinary medicines presents the opportunity to sell other 
parts of our range.
During the course of the year we continued to develop the 
sales of Enrocare, a later generation fluoroquinalone antibiotic, 
and Phenoleptil, a treatment for epilepsy in dogs, which 
were launched at the end of the final quarter of the previous 
financial year. We launched Florgane, a patented formulation 
of a well established cattle antibiotic; Anivac, a vaccine against 
viral haemorrhagic disease (“VHD”) in rabbits; and Sedastart 
and Sedastop, a sedative and reversing agent used in cats 
and dogs. Whilst the sales of the two large animal products, 
Enrocare and Florgane, have been slow to take off additional 
product introductions in the autumn will give renewed impetus 
to these products. In contrast the sales of Anivac in particular 
but also Sedastart and Sedastop have been very good, 
comfortably surpassing the early sales targets set for them. 
We believe this momentum will be sustained.
Overall Animalcare Group grew revenue from continuing 
operations 5.4 per cent in the year to £11.8 million 
(2010 — £11.2 million), ahead of market rates. The 
improvement in mix of products in the range continued, 
and despite the pressure on selling prices seen in some 
product groups, overall gross profit grew by 7.3 per cent 
to £6.4 million (2010 — £6.0 million). Although we again 
strengthened the UK sales team during the course of the 
year, cost savings as a result of the divestitures and good 
overall cost control saw the administrative expenses 
for continuing operations decline to £3.2 million 
(2010— £3.5 million). Underlying operating profit for continuing 
operations once more saw very good growth in the year of 
17.6 per cent to £3.1 million (2010 — £2.6 million).
Future Developments 
We anticipate that the market for companion animal 
veterinary products in UK and in our target European 
markets will remain difficult in the coming year. We are 
however confident that through the efficient execution of our 
strategy of the registration, marketing and sale of selected 
veterinary generic medicines we will continue to deliver rates 
of growth significantly better than the market.
It was our intention to launch four new generic veterinary 
medicines during the course of the year and this was 
achieved through the launch of Anivac VHD, Florgane, 
Sedastart and Sedastop. As the new veterinary generics 
launched in the previous years approach the mature market 
share targets we set for them in the UK, we will continue 
to develop the recently launched products. At the same 
time we already have finished packed goods on hand for 
two new products that we will launch to the market in the 
first half of October 2011 along with a third complementary 
product. These will be supplemented by a very important 
addition to our range that is finishing its regulatory passage in 
September 2011. It will be launched in the UK and with our 
European partners in the coming months. Our knowledge 
of our existing new product development pipeline and that 
of our European development partners is such that, for the 
foreseeable future, we can be confident that we can continue 
to bring our target of four new products to the market each 
year. At the same time the focus and concentration that the 
evolved business structure brings will allow us to improve 
the quality and profitability of our future development pipeline 
through the introduction into the veterinary medicines we 
develop protected technology and innovation. We are already 
working in some novel areas of formulation development that 
have significant commercial promise.
We have already reorganised the structure of our UK sales 
force and we will continue to develop its capabilities. We 
are in the process of recruiting to strengthen other areas 
of the business and these, along with the addition of Iain 
Menneer to the Main Board as Director of Marketing and our 
anticipated move to new premises during the course of the 
year, will see us well placed to perform well in what may be a 
difficult year. Importantly it will lay the foundations of the next 
steps in the development of Animalcare.
Stephen Wildridge
Chief Executive Officer Annual Report 2011
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Group Overview
The Group disposed of its entire livestock division during 
the year, but the marginally profitable nature of the livestock 
division and the improving profitability in the continuing 
companion animal division saw the underlying profit after tax 
rise to £2.39 million (2010 — £2.22 million).
Earnings before interest, taxation, depreciation and 
amortisation (“EBITDA”) for the year were £3.39 million 
(2010 — £3.13 million), this improvement was despite the loss 
of £0.09 million on the disposal of the livestock businesses. 
Net financing costs for the year ended 30 June 2011 were 
£0.05 million (2010 — £0.15 million), reflecting the repayment 
in full of Group borrowings.
 
The proceeds of the business disposals and strong cash 
flow from operations enabled us to repay in full the bank 
loans which were £4.46 million at 30 June 2010. As a 
consequence, the Group moved from a net debt of £2.89 
million at 30 June 2010 to net funds, being all cash on hand, 
of £1.18 million at 30 June 2011.
Basic underlying* earnings per share were 11.8p 
(2010 — 11.2p). Basic total earnings per share were 11.5p 
(2010 — loss of 5.2p), the prior year number including 
the impact of exceptional write downs in the livestock 
division. Fully diluted total earnings per share were 11.4p 
(2010 — loss of 5.2p).
The final dividend of 3.0 pence for 2010 paid in December 
2010 was followed by a maiden interim dividend of 1.0 
pence per share paid in June 2011.
Continuing Operations
Revenue in the year was £11.83 million (2010 — £11.22 million) 
and gross profit was £6.39 million (2010 — £5.96 million), 
representing growth of 5 and 7 per cent respectively. As 
previously, the main driver for this was the 8 per cent growth 
in licensed veterinary medicines, but revenue from services 
of £0.99 million (2010 — £0.88 million), principally in animal 
identification, also grew by 13 per cent.
Underlying* gross profit for the segment increased marginally 
at 54.0 per cent of revenue against 53.1 per cent in 2010, 
reflecting the revenue growth in our higher margin product 
groups.
Underlying* distribution costs rose to £0.29 million 
(2010 — £0.26 million) as a consequence of increased sales 
volumes and higher fuel costs. Underlying* administrative 
expenses fell to £3.05 million (2010 — £3.10 million) partially 
due to lower spend on new product development than in 
2010. As noted in previous reports this expenditure tends 
by its nature to occur in an irregular pattern dependent on 
development programmes. Underlying* operating profit from 
continuing operations rose as a consequence to 
£3.05 million (2010 — £2.60 million).
The effective tax charge for the year for continuing operations 
was 23.1 per cent (2010 — 31.2 per cent), reflecting the effect 
of adjustments to the prior year’s corporation tax expense.
EBITDA for the continuing operation was £3.27 million 
(2010 — £2.61 million).
Financial Review
“The proceeds of the business 
disposals and strong cash flow from 
operations enabled us to repay in full 
the bank loans which were £4.46 million 
at 30 June 2010.” www.animalcaregroup.co.uk
Stock code: ANCR
Our Business
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Disposals
On 17 September 2010 the Company sold the business 
and assets of its trading division, Ritchey, and the shares 
of its wholly owned subsidiary, Fearing International (Stock 
Aids) Limited, for cash. The expected gross consideration 
was £3.25 million, based on the audited accounts for these 
businesses at 30 June 2010 and subject to completion 
accounting. The Group received £0.52 million as working 
capital inflows prior to the sale and £2.52 million in cash 
from the purchaser, which included an agreed reduction in 
the consideration of £0.20 million in respect of unanticipated 
difficult trading conditions and profit shortfall in a key new 
product. The costs of disposal were £0.09 million, producing 
a loss before tax of £0.12 million. All the consideration was 
received during the year.
On 19 November 2010 the Group sold the trade and assets 
of its loss making subsidiary, Travik Chemicals Limited 
(now Naychem Limited), for a total consideration of £0.07 
million net of costs. The buyer of the business subsequently 
purchased the freehold of Travik’s Newton Aycliffe property 
for £0.23 million on 24 June 2011. These disposals 
produced a profit before tax of £0.03 million.
The discontinued operations contributed an underlying* profit 
after tax of £0.15 million (2010 — £0.50 million) from trading 
during the period prior to disposal.
Exceptional Costs and Other Items
Other items excluded from underlying* results are 
amortisation of acquired intangibles £0.12 million 
(2010 — £0.12 million) and fair value movements on 
interest rate hedging £nil (2010 — £0.04 million).
There were no exceptional costs during the year. Full 
details of exceptional costs during the previous year, which 
comprised impairments and other costs related to the 
Ritchey and Fearing businesses, charges relating to Group 
reorganisation and impairments and other costs related to 
Travik Chemicals, can be found in note 6 to the financial 
statements.
Cash Flow
Net cash flow from operating activities was £2.15 million 
(2010 — £1.94 million). Working capital showed an outflow 
of £0.50 million (2010 — £0.54 million). A reduction in trade 
receivables of £0.57 million, due principally to reductions in 
Livestock trade debtors prior to disposal of the businesses 
was offset to some extent by strategic increases in 
inventories in continuing operations.
Income taxes paid were £0.80 million (2010 —£0.55 million), 
reflecting the increase in the Group’s taxable profits. Interest 
payments fell to £0.11 million (2010 — £0.27 million) due to 
the settlement of the Group’s loans and interest rate swap 
during the year. Net cash flow from operating activities was 
£2.15 million (2010 — £1.94 million).
Capital expenditure in the continuing operation was 
£0.15 million (2010 — £0.35 million), due to lower 
expenditure on intangible assets. Share proceeds generated 
£0.18 million (2010 — £0.17 million) with the issue of 326,195 
ordinary shares in respect of approved employee share 
options. Dividends of £0.81 million (2010 — £0.61 million) 
were paid in the year.
* Underlying results are before the effect of exceptional 
costs and other items disclosed in note 6 to the financial 
statements.
Peter Warner
Chief Financial Officer Annual Report 2011
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The Board
1. James Lambert  
Non-executive Chairman
James was appointed Chairman in October 2005 having been a non-executive director since 
2003. He started Richmond Foods in 1998 leading a series of acquisitions to make Richmond 
the largest ice cream manufacturer by volume in the UK. Richmond exited the stock market in 
April 2006 when it was bought by Oaktree Capital for £176 million and merged with Roncadin. 
James is now running the enlarged Group.
2. Stephen Wildridge  
Group Chief Executive Officer
Stephen spent 16 years with Rhone–Poulenc (now Bayer Crop Science) in a variety of 
Sales, Marketing and Strategic Planning and General Management roles encompassing 
agro-chemicals, animal health and animal nutrition. Subsequently he spent five years with 
Monsanto as General Manager of Operations for Northern Europe and Director of Business 
Development Europe–Africa. He was appointed Managing Director of Animalcare Limited in 
2003 developing the strategic plan and product development programme for the business.
3. Peter Warner  
Chief Financial Officer and Company Secretary
Peter spent eight years with Bowater (now Rexam) plc, the last five as site accountant in 
packaging manufacture. He was part of the team responsible for transferring the production 
facility to Indonesia, then spent two years as Financial Controller of an engineering 
subsidiary of BTR plc. In 1996 he joined VDC plc, then parent company of Animalcare 
Limited, as Group Accountant with responsibility for the wholesale division, becoming 
Financial Controller of Animalcare Limited in 2006 following the sale of the wholesale 
division. He became Financial Controller of Animalcare Group in July 2009.
4. Iain Menneer
Director of Marketing
Iain has a PhD in chemistry from the University of Newcastle and worked in the brewing industry 
for six years in research at an independent brewing consultancy and then in new product and 
technical development roles at Bass Brewers. Subsequently, he spent two years in the Research 
and Innovation Office at the University of York working with academics to commercialise their 
research via licensing or spin-out companies. He joined Animalcare Limited in December 2003, 
and has worked in marketing and business development roles, notably working on the new 
product development pipeline. Iain has been Head of Marketing since July 2009.
5. Lord Downshire
Non-executive Director
Lord Downshire has been a non-executive director since 1998. He trained as a Chartered 
Accountant with Touche Ross before transferring to the corporate finance department where 
he worked for three years on acquisitions, flotations and new ventures. Following this he 
worked for 13 years at Scheduling Technology Group Limited, a venture capital backed 
international software company, becoming Finance Director until the sale of the business 
in 2001. He currently farms and manages an estate in Yorkshire and holds non-executive 
directorships in companies operating in RFID, agricultural supplies, hotels and insurance.
1.
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5. www.animalcaregroup.co.uk
Stock code: ANCR
09
20660-04 03/10/2011 Proof 6
Governance
Directors’ Report
The directors present their annual report on the affairs of the 
Group together with the financial statements and auditors’ 
report for the year ended 30 June 2011.
Principal Activities
The principal activity of the Group during the year was 
the development and distribution of veterinary medicines, 
identification and other products for companion animals. The 
Group disposed of its entire Livestock Division during the year.
Business Review and Future Developments
A review of the business and future developments is 
provided in the Chairman’s Statement, Chief Executive’s 
Review and Financial Review.
Research and Development
The Group is committed to the development of new and 
innovative products to meet the needs of its customers. 
During the year to 30 June 2011 the Group invested in 
developments in veterinary medicines, and in enhancements 
to its pet owner database.
Dividends
A final dividend of 3.0 pence per share will be proposed 
at the Annual General Meeting on 28 October 2011 and is 
proposed to be paid on 7 November 2011 to all shareholders 
on the share register at 14 October 2011. This will combine 
with a maiden interim dividend of 1.0 pence per share paid 
on 6 June 2011 to give a total of 4.0 pence for the year 
ended 30 June 2011.
Capital Structure
The Company’s issued share capital as at 30 June 2011 was 
20,373,711 ordinary shares of 20 pence each, each credited 
as fully paid. 
Directors
The following directors held office during the year ended  
30 June 2011 and subsequently:
J S Lambert
S M Wildridge
Lord Downshire
P O R Warner (appointed 14 October 2010)
I D Menneer (appointed 1 July 2011)
G C Rhodes (resigned 30 November 2010)
J Tobin (resigned 31 December 2010)
Details of directors’ share options and long-term incentive 
plans are provided in note 9 to the financial statements.
The Company maintains directors’ and officers’ liability 
insurance for the benefit of its directors, which was in place 
throughout the year ended 30 June 2011 and remains in 
place at the date of this report.
Principal Risks and Uncertainties
New product development
A key element of the Group’s strategy is to expand its 
portfolio of veterinary medicines, the success of which 
depends on these products meeting the required regulatory 
standards and achieving the necessary marketing 
authorisations. Rejection of applications or delays in the 
regulatory process could have an important impact on 
the Group’s results. Also there can be no guarantee of 
the commercial success of these products following their 
launch. The risks of failure, rejection or delay are mitigated or 
reduced by the careful selection of development strategies 
that although they may increase initial cost or time of 
development reduce the likelihood of complete unexpected 
failure of a project. At the same time the overall risk of 
any one project failure having a major influence on the 
performance of the business is reduced by having a product 
development pipeline that has numerous projects within it at 
various stages of development.  Annual Report 2011
10
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Key customers
The Group derives a substantial proportion of its revenue 
from a number of key customers. In the event that these 
relationships are lost the effect on the Group’s revenue could 
be significant. In the UK however such an effect is likely to 
be temporary as the supply chain would rapidly adjust to 
take up the slack brought about by any catastrophic failure. 
Equally, as our business develops its scope into new markets 
the key customer base continues to grow.
Key suppliers
The Group purchases goods for resale under supply and 
distribution agreements with a number of key suppliers. 
Failure of supply under these arrangements could result in 
significant loss of Group revenue. We however endeavour to 
have where possible more than one supplier for key elements 
of the range and, where that is not possible, different parts of 
the range with different suppliers.
Retention of key employees
The Group has a small senior executive management 
team whose skills, knowledge and experience are key to 
the success of Group strategy. Loss of any of these team 
members could significantly affect Group performance.
Financial instruments
The Group’s exposure to, and arrangements for, the 
management of financial risks are described in note 23 to the 
financial statements.
Creditor Payment Policy
It is the Group’s policy to maintain good relationships with its 
suppliers. Suppliers are made aware of the terms of payment 
which are agreed with them in advance and these terms are 
adhered to. The number of days purchases included in trade 
creditors at 30 June 2011 was 48 days (2010 — 38 days).
Corporate Governance
The directors support the underlying principles of the 
Combined Code, notwithstanding that the Company is not 
required to comply with all of the Code’s recommendations. 
The board recognises its overall responsibility for the Group’s 
systems of internal control and their effective operation and 
it has sought to comply with those provisions of the Code 
judged appropriate for the current size and nature of the 
Group, being the establishment of an audit committee, a 
remuneration committee and a nominations committee.
Formally constituted audit, remuneration and nominations 
committees, with membership comprising the Company’s 
two non-executive directors, were established on the Group’s 
admission to AIM and are active in the conduct of internal 
financial control, executive performance and remuneration 
and board appointments.
Charitable and Political Donations
During the year the Group made charitable donations of 
£178 (2010 — £262). No political donations were made 
during the year (2010 — nil).
Employees
Applications for employment by disabled persons are 
given full and fair consideration. When existing employees 
become disabled every effort is made to provide continuing 
employment wherever possible.
The directors recognise the importance of good 
communications with employees and continue to consult 
and inform them on matters affecting them and the 
performance of the Group. Employees are provided with 
financial incentives related to the performance of the Group 
in the form of annual bonuses and participation in approved 
sharesave schemes.
Directors’ Report www.animalcaregroup.co.uk
Stock code: ANCR
11
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Governance
Substantial Shareholdings
On 14 September 2011 the Company had been notified, in accordance with chapter 5 of the Disclosure and Transparency 
Rules, of the following voting rights as shareholders of the Company.
Name of holder
No. of
ordinary
shares 
Nature of
holding
Brewin Dolphin 2,564,628 12.6%
Including the beneficial shareholding of J S Lambert of 1,286,691 shares (6.3 per cent)
Investec Wealth Management Limited 1,987,227 9.7%
Including the beneficial shareholding of S F Riddell of 675,000 shares (3.3 per cent)
Octopus Investments 1,690,139 8.3%
Unicorn Asset Management 1,636,763 8.0%
Liontrust Asset Management 1,439,287 7.1%
Lord Downshire* 1,420,029 7.0%
Hargreave Hale 1,172,997 5.7%
Downing Corporate Finance Limited 790,368 3.9%
Williams de Broë 760,606 3.7%
N R Sale 613,400 3.0%
 
* Lord Downshire’s interest includes a non-beneficial interest in 310,446 ordinary shares. 
Going Concern
The principal risks and uncertainties facing the Group are set 
out on pages 9 to 10.
Following the sale of the Group’s livestock businesses in 
the current year for cash, on 31 March 2011 the Group 
repaid the balance of its outstanding loan facility, which stood 
at £4.46 millon on 30 June 2010. The Group has an 
undrawn overdraft facility of £100,000 which is available for 
general corporate and working capital requirements. At 
30 June 2011 the Group had cash on hand of £1.18 million 
(30 June 2010 — £1.56 million), leaving it in a net funds 
position. In the directors’ opinion, the Group’s working capital 
requirements can be met from operating cash flow. 
Overall, the directors believe the Group is well placed to 
manage its business risks successfully despite the current 
uncertain economic outlook. The Group’s forecasts and 
projections, taking account of reasonably possible changes in 
trading performance, show that the Group should be able to 
operate within the level of its current committed facilities.
After making enquiries, the directors have a reasonable 
expectation that the Company and the Group have adequate 
resources to continue in operational existence for the 
foreseeable future. Accordingly, they continue to adopt the 
going concern basis in preparing the financial statements.
Auditors
Each of the persons who is a director at the date of this annual 
report confirms that:
— So far as the director is aware, there is no relevant audit 
information of which the Company’s auditors are unaware; 
and
— The director has taken all the steps that he ought to have 
taken as a director in order to make himself aware of 
any relevant audit information and to establish that the 
Company’s auditors are aware of that information.
This confirmation is given and should be interpreted in 
accordance with the provisions of s418 of the Companies 
Act 2006.
KPMG Audit Plc have expressed their willingness to continue 
in office as auditors and a resolution to reappoint them will be 
proposed at the forthcoming Annual General Meeting.
Animalcare Group plc
By order of the board,
P O R Warner
Company Secretary
19 September 2011 Annual Report 2011
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20660-04 03/10/2011 Proof 6
Statement of Directors’ Responsibilities in respect of the 
Annual Report and the Financial Statements  
for the year ended 30 June 2011
The directors are responsible for preparing the Annual Report 
and the group and parent company financial statements in 
accordance with applicable law and regulations. Company law 
requires the directors to prepare group and parent company 
financial statements for each financial year. As required by the 
AIM Rules of the London Stock Exchange they are required to 
prepare the group and parent company financial statements in 
accordance with IFRSs as adopted by the EU and applicable law.
Under company law the directors must not approve the 
financial statements unless they are satisfied that they give a 
true and fair view of the state of affairs of the group and parent 
company and of their profit or loss for that period. In preparing 
each of the group and parent company financial statements, 
the directors are required to:
● select suitable accounting policies and then apply them 
consistently;
● make judgements and estimates that are reasonable and 
prudent;
● state whether they have been prepared in accordance 
with IFRSs as adopted by the EU; and
● prepare the financial statements on the going concern 
basis unless it is inappropriate to presume that the group 
and the parent company will continue in business.
The directors are responsible for keeping adequate accounting 
records that are sufficient to show and explain the parent 
company’s transactions and disclose with reasonable accuracy 
at any time the financial position of the parent company and 
enable them to ensure that its financial statements comply with 
the Companies Act 2006. They have general responsibility for 
taking such steps as are reasonably open to them to safeguard 
the assets of the group and to prevent and detect fraud and 
other irregularities.
The directors are responsible for the maintenance and integrity 
of the corporate and financial information included on the 
company’s website. Legislation in the UK governing the 
preparation and dissemination of financial statements may 
differ from legislation in other jurisdictions.  www.animalcaregroup.co.uk
Stock code: ANCR
13
20660-04 03/10/2011 Proof 6
Governance
Independent Auditors’ Report to the  
Members of Animalcare Group plc
We have audited the financial statements of Animalcare 
Group plc for the year ended 30 June 2011 set out on pages 
14 to 52. The financial reporting framework that has been 
applied in their preparation is applicable law and International 
Financial Reporting Standards (IFRSs) as adopted by the EU 
and, as regards the parent company financial statements, as 
applied in accordance with the provisions of the Companies 
Act 2006.
 
This report is made solely to the company’s members, as 
a body, in accordance with Chapter 3 of Part 16 of the 
Companies Act 2006 and on terms that have been agreed. 
Our audit work has been undertaken so that we might state 
to the company’s members those matters we are required to 
state to them in an auditor’s report and for no other purpose. 
To the fullest extent permitted by law, we do not accept or 
assume responsibility to anyone other than the company and 
the company’s members, as a body, for our audit work, for 
this report, or for the opinions we have formed.
Respective responsibilities of directors and auditor
As explained more fully in the Directors’ Responsibilities 
Statement set out on page 12 the directors are responsible 
for the preparation of the financial statements and for 
being satisfied that they give a true and fair view. Our 
responsibility is to audit, and express an opinion on, the 
financial statements in accordance with applicable law and 
International Standards on Auditing (UK and Ireland). Those 
standards require us to comply with the Auditing Practices 
Board’s (APB’s) Ethical Standards for Auditors.
Scope of the audit of the financial statements
A description of the scope of an audit of financial statements 
is provided on the APB’s website atwww.frc.org.uk/apb/
scope/private.cfm.
Opinion on financial statements
In our opinion:
●  the financial statements give a true and fair view of the 
state of the group’s and of the parent company’s affairs 
as at 30 June 2011 and of the group’s profit for the year 
then ended;
●  the group financial statements have been properly 
prepared in accordance with IFRSs as adopted by 
the EU;
●  the parent company financial statements have been 
properly prepared in accordance with IFRSs as adopted 
by the EU and as applied in accordance with the 
provisions of the Companies Act 2006;
●  the financial statements have been prepared in 
accordance with the requirements of the Companies Act 
2006.
Opinion on other matters prescribed by the Companies 
Act 2006
In our opinion the information given in the Directors’ Report 
for the financial year for which the financial statements are 
prepared is consistent with the financial statements.
Matters on which we are required to report by 
exception
We have nothing to report in respect of the following:
Under the Companies Act 2006 and under the terms of 
our engagement we are required to report to you if, in our 
opinion:
●  adequate accounting records have not been kept by the 
parent company, or returns adequate for our audit have 
not been received from branches not visited by us; or
●  the parent company financial statements are not in 
agreement with the accounting records and returns; or
●  certain disclosures of directors’ remuneration specified 
by law are not made; or
●  we have not received all the information and 
explanations we require for our audit.
Chris Hearld (Senior Statutory Auditor)
For and on behalf of
KPMG Audit Plc
Statutory Auditor
Chartered Accountants
1 The Embankment
Leeds
LS1 4DW
19 September 2011 Annual Report 2011
14
20660-04 03/10/2011 Proof 6
Consolidated Statement of Comprehensive Income
Year ended 30 June 2011
Note
Underlying 
results 
before 
exceptional 
and other 
items
2011
£’000
Exceptional 
and other 
items*
2011
£’000 
Total 
2011
£’000
Underlying 
results 
before 
exceptional 
and other
items
Restated†
2010
£’000
Exceptional 
and other 
items* 
Restated†
2010
£’000
Total 
Restated†
2010
£’000
Revenue  11,825  —  11,825  11,223  —  11,223 
Cost of sales   (5,435) —  (5,435) (5,266) —  (5,266)
Gross profit  6,390  —  6,390  5,957  —  5,957 
Distribution costs  (292) —  (292) (264) —  (264)
Administrative expenses   (3,045) (118) (3,163) (3,096) (401) (3,497)
Operating profit/(loss) 6, 8 3,053  (118) 2,935  2,597  (401) 2,196 
Finance costs 11 (51) (1) (52) (130) (38) (168)
Finance income 11 2  —  2  16  —  16 
Profit/(loss) before tax 6, 8 3,004  (119) 2,885  2,483  (439) 2,044 
Income tax (expense)/credit 12 (717) 52  (665) (761) 123  (638)
Total comprehensive income/
(loss) for the year from continuing 
operations   2,287  (67) 2,220  1,722  (316) 1,406 
Total comprehensive income/(loss) for 
the year from discontinued operations 4 105  —  105  499  (2,936) (2,437)
Total comprehensive income/(loss) 
for the year   2,392  (67) 2,325  2,221  (3,252) (1,031)
Total basic earnings/(loss) per share 14 11.8p 11.5p 11.2p (5.2p)
Total fully diluted earnings/(loss)  
per share 14 11.4p 11.1p 11.0p (5.2p)
Basic earnings per share from continuing 
operations 14 11.3p 11.0p 8.7p 7.1p
Fully diluted earnings per share from 
continuing operations 14 11.2p 10.8p 8.5p 6.9p
Total comprehensive income/(loss)for the year is attributable to the equity holders of the parent.
*  In order to aid understanding of underlying business performance, the directors have presented underlying results before the 
effect of exceptional and other items. These exceptional and other items are analysed in detail in note 6 to these financial 
statements.
†  During 2011 the Group disposed of the businesses and assets of its Livestock Division. The segment was not classified 
as held for sale or as a discontinued operation as at 30 June 2010, and the comparative consolidated statement of 
comprehensive income has been restated to show discontinued operations separately.  www.animalcaregroup.co.uk
Stock code: ANCR
15
20660-04 03/10/2011 Proof 6
Accounts
Statements of Changes in Shareholders’ Equity
Year ended 30 June 2011
Group Note
Share 
capital
£’000
Share 
premium 
account
£’000
Retained 
earnings
£’000
Total
£’000
Balance at 1 July 2009  3,951  5,824  5,607  15,382 
Total comprehensive loss for the year —  —  (1,031) (1,031)
Transactions with owners of the Company, 
recognised in equity:
Dividends paid 13 —  —  (494) (494)
Issue of share capital 26 59  107  —  166 
Share-based payments —  —  58  58 
Balance at 1 July 2010 4,010  5,931  4,140  14,081 
Total comprehensive income for the year —  —  2,325  2,325 
Transactions with owners of the Company, 
recognised in equity:
Dividends paid 13 —  —  (812) (812)
Issue of share capital 26 65  114  —  179 
Share-based payments —  —  16  16 
Balance at 30 June 2011 4,075  6,045  5,669  15,789 
Company Note
Share 
capital
£’000
Share 
premium 
account
£’000
Retained 
earnings
£’000
Total
£’000
Balance at 1 July 2009  3,951  5,824  3,980  13,755 
Total comprehensive loss for the year —  —  (1,258) (1,258)
Transactions with owners of the Company, 
recognised in equity:
Dividends paid 13 —  —  (494) (494)
Issue of share capital 26 59  107  —  166 
Share-based payments —  —  58  58 
Balance at 1 July 2010 4,010  5,931  2,286  12,227 
Total comprehensive income for the year —  —  3,570  3,570 
Transactions with owners of the Company, 
recognised in equity:
Dividends paid 13 —  —  (812) (812)
Issue of share capital 26 65  114  —  179 
Share-based payments —  —  10  10 
Balance at 30 June 2011 4,075  6,045  5,054  15,174 
As permitted by section 408 of the Companies Act 2006, the statement of comprehensive income of the parent Company is not 
presented as part of these financial statements. Annual Report 2011
16
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Balance Sheets
30 June 2011
Group Company
Note
2011
£’000
2010
£’000
2011
£’000
2010
£’000
Non-current assets
Goodwill 15 12,711  13,027  —  — 
Other intangible assets 16 1,820  2,105  —  117 
Property, plant and equipment 17 47  1,153  —  795 
Investments in subsidiary companies 18 —  —  14,361  15,276 
Deferred tax asset 25 —  —  156  35 
  14,578  16,285  14,517  16,223 
Current assets
Inventories 19 1,346  1,815  —  618 
Trade and other receivables 20 1,681  3,418  652  2,091 
Cash and cash equivalents 20 1,179  1,564  207  224 
  4,206  6,797  859  2,933 
Total assets  18,784  23,082  15,376  19,156 
Current liabilities
Trade and other payables 21 (1,566) (2,770) (202) (2,418)
Current tax liabilities  (320) (479) —  — 
Bank overdraft and loans 22 —  (883) —  (883)
Deferred income 24 (182) (154) —  — 
Derivative financial instruments 23 —  (55) —  (55)
Current liabilities  (2,068) (4,341) (202) (3,356)
Net current assets/(liabilities) 2,138  2,456  657  (423)
Non-current liabilities
Bank loans 22 —  (3,573) —  (3,573)
Deferred income 24 (862) (837) —  — 
Deferred tax liabilities 25 (65) (250) —  — 
  (927) (4,660) —  (3,573)
Total liabilities  (2,995) (9,001) (202) (6,929)
Net assets  15,789  14,081  15,174  12,227 
Capital and reserves
Called up share capital 26 4,075  4,010  4,075  4,010 
Share premium account  6,045  5,931  6,045  5,931 
Retained earnings 5,669  4,140  5,054  2,286 
Equity attributable to equity holders 
of the parent  15,789  14,081  15,174  12,227 
The financial statements of Animalcare Group plc, registered number 1058015, were approved by the board of directors and 
authorised for issue on 19 September 2011.
They were signed on its behalf by:
P O R Warner
Chief Financial Officer www.animalcaregroup.co.uk
Stock code: ANCR
17
20660-04 03/10/2011 Proof 6
Accounts
Cash Flow Statements
Year ended 30 June 2011
Group Company
Note
2011
£’000
2010
£’000
2011
£’000
2010
£’000
Comprehensive income/(loss) for the year  
before tax 12 2,936  (558) (723) (3,101)
Adjustments for:
Depreciation of property, plant and equipment 17 88  287  35  165 
Amortisation of intangible assets 16 317  308  16  63 
Impairment of intangible assets 16 —  115  —  115 
Impairment of property, plant and equipment 17 —  596  —  225 
Impairment of investments 18 —  —  —  2,108 
Goodwill impairment charge 15 —  2,227  —  20 
Finance costs 11 55  175  52  166 
Finance income 11 (2) (16) (2) — 
Share-based payment award 16  58  10  2 
Release of deferred income 24 53  108  —  — 
(Profit)/loss on disposal of property,  
plant and equipment (2) (16) — 2
Loss on sale of businesses 5 94  —  366  — 
Operating cash flows before movements  
in working capital 3,555 3,284 (246) (179)
(Increase)/decrease in inventories 19 (596) 217  (77) 25 
Decrease/(increase) in receivables 20 572  (829) 750  (501)
(Decrease)/increase in payables 21 (471) 76  (1,745) 840 
Cash generated by operations  3,060  2,748  (1,318) 185 
Income taxes (paid)/received (805) (547) —  88 
Interest paid  (110) (265) (108) (256)
Net cash flow from operating activities   2,145  1,936  (1,426) 17 
Investing activities:
Payments to acquire intangible assets 16 (134) (407) (1) (69)
Payments to acquire property, plant and equipment 17 (18) (205) (1) (174)
Interest received 11 2  16  2  — 
Dividends received —  —  4,072  1,650 
Receipts from sale of property, plant and equipment 4 20 1 1
Receipts from sale of businesses 5 2,705  —  2,425  — 
Net cash generated by/(used in) 
investing activities 2,559 (576) 6,498 1,408
Financing:
Receipts from issue of share capital  179  166  179  166 
Equity dividends paid 13 (812) (494) (812) (494)
Repayment of bank loans 22 (4,456) (1,000) (4,456) (1,000)
Net cash used in financing activities   (5,089) (1,328) (5,089) (1,328)
Net (decrease)/increase in cash and cash equivalents (385) 32 (17) 97
Cash and cash equivalents at start of year   1,564  1,532  224  127 
Cash and cash equivalents at end of year   1,179  1,564  207  224 
Comprising:
Cash and cash equivalents 20 1,179  1,564  207  224 
    1,179  1,564  207  224  Annual Report 2011
18
20660-04 03/10/2011 Proof 6
Notes to the Accounts
Year ended 30 June 2011
1.  GENERAL INFORMATION
Animalcare Group plc (“the Company”) is a company incorporated in England and Wales under the Companies Act 2006 
and is domiciled in the United Kingdom. The Group comprises Animalcare Group plc and its subsidiaries. The nature of the 
Group’s operations and its principal activities are set out in note 7 and within the directors’ report.
The IASB and IFRIC have issued the following standards and interpretations, with an effective date after the date of these 
financial statements. Their adoption, where applicable, is not expected to have a material effect on the financial statements 
of the Group.
Applies to periods
International Financial Reporting Standards beginning after
IAS 24 Related party disclosures (revised 2009) January 2011
IFRS 13 Fair value measurement May 2011
IAS 1 Presentation of Financial Statements (amended) June 2011
IAS 19 Post-employment benefits June 2011
IFRS 7 Amendments to Financial Instruments: Disclosures July 2011
IAS 12 Amendment Income taxes on deferred tax January 2012
IFRS 9 Financial Instruments January 2013
2.  SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation
The Group and Company financial statements have been prepared and approved by the directors under the historical cost 
convention, except for the revaluation of certain financial instruments, in accordance with International Financial Reporting 
Standards (“IFRS”) as adopted by the European Union (“adopted IFRSs”) and the Companies Act 2006 as applicable to 
companies reporting under IFRS. They have also been prepared in accordance with the requirements of the AIM Rules.
Going concern
The principal risks and uncertainties facing the Group are set out on pages 9 to 10.
Following the sale of the Group’s livestock businesses in the current year for cash, on 31 March 2011 the Group repaid the 
balance of its outstanding loan facility, which stood at £4.46 millon on 30 June 2010. The Group has an undrawn overdraft 
facility of £100,000 which is available for general corporate and working capital requirements. At 30 June 2011 the Group 
had cash on hand of £1.18 million (30 June 2010 — £1.56 million), leaving it in a net funds position. In the directors’ 
opinion, the Group’s working capital requirements can be met from operating cash flow. 
Overall, the directors believe the Group is well placed to manage its business risks successfully despite the current uncertain 
economic outlook. The Group’s forecasts and projections, taking account of reasonably possible changes in trading 
performance, show that the Group should be able to operate within the level of its current committed facilities.
After making enquiries, the directors have a reasonable expectation that the Company and the Group have adequate 
resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going 
concern basis in preparing the financial statements. www.animalcaregroup.co.uk
Stock code: ANCR
19
20660-04 03/10/2011 Proof 6
Accounts
2.  SIGNIFICANT ACCOUNTING POLICIES (continued)
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the 
Company (its subsidiaries) made up to 30 June each year. Control is achieved where the Company has the power to govern 
the financial and operating policies of an investee entity so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are included in the consolidated statement of 
comprehensive income from the effective date of acquisition or up to the effective date of disposal, as appropriate.
Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used 
into line with those used by the Group.
All intra-Group transactions, balances, income and expenses are eliminated on consolidation.
Discontinued operations
The Livestock businesses were disposed of during the year and represent a discontinued operation as defined in IFRS 5 
Non-Current Assets held for sale 9 and Discontinued Operations. As a result the Statement of Comprehensive Income has 
been restated as if the Livestock businesses had been discontinued from 1 July 2009 (see note 4).
Business combinations
The acquisition of subsidiaries and other businesses is accounted for using the purchase method. The cost of the 
acquisition is measured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or 
assumed, and equity instruments issued by the Group in exchange for control of the acquiree. Costs directly attributable to 
the business combination are expensed. The acquiree’s identifiable assets, liabilities and contingent liabilities that meet the 
conditions for recognition under IFRS 3 (revised) are recognised at their fair value at the acquisition date, except for non-
current assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non-Current Assets Held 
for Sale and Discontinued Operations, which are recognised and measured at fair value less costs to sell.
Exceptional and other items
Exceptional items are material items of income or expense which, because of their nature and the expected frequency of 
the events giving rise to them, merit separate disclosure.
Other items relate to the amortisation of acquired intangible assets, fair value movements on interest rate hedging and 
impairment of goodwill.
The separate presentation of exceptional and other items enables the users of the accounts to better understand the 
elements of financial performance during the year and hence to better assess trends in that financial performance.
Goodwill
Goodwill arising on consolidation represents the excess of the cost of acquisition over the Group’s interest in the fair 
value of the identifiable assets and liabilities of a subsidiary, associate or jointly controlled entity at the date of acquisition. 
Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less any accumulated impairment 
losses. Goodwill which is recognised as an asset is reviewed for impairment at least annually. Any impairment is recognised 
immediately in comprehensive income and is not subsequently reversed.
For the purpose of impairment testing, goodwill is allocated to each of the Group’s cash-generating units (CGUs) expected 
to benefit from the synergies of the combination. CGUs to which goodwill has been allocated are tested for impairment 
annually, or more frequently when there is an indication that the CGU may be impaired. If the recoverable amount of the 
CGU is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill 
allocated to the unit and then to the other assets of the CGU pro rata on the basis of the carrying amount of each asset in 
the CGU. An impairment loss recognised for goodwill is not reversed in a subsequent period. Annual Report 2011
20
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Notes to the Accounts
Year ended 30 June 2011
2.  SIGNIFICANT ACCOUNTING POLICIES (continued)
On disposal of a subsidiary, associate or jointly controlled entity, the attributable amount of goodwill is included in the 
determination of the profit or loss on disposal.
Goodwill arising on acquisitions before the date of transition to IFRS (1 July 2004) has been retained at the previous UK 
GAAP amounts subject to being tested for impairment at that date. Goodwill written off to reserves under UK GAAP prior to 
1998 has not been reinstated and is not included in determining any subsequent profit or loss on disposal.
Intangible assets
The Group recognises intangible assets at cost less accumulated amortisation and impairment losses. Intangible assets 
arise both as a result of applying IFRS 3 which requires the separate recognition of intangible assets from goodwill on all 
business combinations from 1 January 2004, and from the purchase of software (that is separable from any associated 
hardware), and development machinery and from research and development (see below).
Intangible assets are amortised on a straight-line basis over their useful economic lives as follows:
Customer relationships 10 years
Brands 15 years
Software Useful life of the software
Research and development Estimated economic life, normally 4–5 years
The useful life of software is currently estimated to be 2–4 years.
Internally generated intangible assets — research and development expenditure
Expenditure on research activities is recognised as an expense in the year in which it is incurred.
An internally generated intangible asset arising from the Group’s product development is recognised only if all of the 
following conditions are met:
— an asset is created that can be identified (such as software and new processes);
— it is probable that the asset created will generate future economic benefits; and
— the development cost of the asset can be measured reliably.
Internally generated intangible assets are amortised on a straight-line basis over their useful lives. Where no internally 
generated intangible asset can be recognised, development expenditure is recognised as an expense in the year in which it 
is incurred.
Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for 
goods and services provided in the normal course of business, net of discounts, VAT and other sales related taxes. 
Revenue from the sale of goods is recognised when the risks and rewards of ownership are transferred which is generally 
when goods are delivered.
Income received in relation to long-term service contracts is deferred and subsequently recognised over the life of the 
relevant contracts. Further details are contained in note 24.
Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate 
applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial 
asset to that asset’s net carrying value. www.animalcaregroup.co.uk
Stock code: ANCR
21
20660-04 03/10/2011 Proof 6
Accounts
2.  SIGNIFICANT ACCOUNTING POLICIES (continued)
Leasing
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of 
ownership to the lessee. All other leases are classified as operating leases.
The Group as lessee
Rentals payable under operating leases are charged to income on a straight-line basis over the term of the relevant lease.
Assets held under finance leases are recognised as assets of the Group at their fair value or, if lower, at the present value 
of the minimum lease payments, each determined at the inception of the lease. The corresponding liability to the lessor is 
included in the balance sheet as a finance lease obligation. Lease payments are apportioned between finance charges and 
reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance 
charges are charged directly against income, unless they are directly attributable to qualifying assets, in which case they are 
capitalised in accordance with the Group’s general policy on borrowing costs (see below).
Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that 
necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, 
until such time as the assets are substantially ready for their intended use or sale. Investment income earned on the temporary 
investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible 
for capitalisation. All other borrowing costs are recognised in comprehensive income in the period in which they are incurred.
Retirement benefit costs
Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due. Payments made 
to state-managed retirement benefit schemes are dealt with as payments to defined contribution schemes where the 
Group’s obligations under the schemes are equivalent to those arising in a defined contribution retirement benefit scheme.
Foreign currencies
In preparing the financial statements of the individual companies, transactions in currencies other than the entity’s functional 
currency (foreign currencies) are recorded at the rates of exchange prevailing on the dates of the transactions. At each 
balance sheet date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates 
prevailing on the balance sheet date. Non-monetary items carried at fair value that are denominated in foreign currencies are 
translated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in 
terms of historical cost in a foreign currency are not retranslated.
Exchange differences arising on the settlement of monetary items, and on the retranslation of monetary items, are included 
in comprehensive income for the year.
Segment reporting
An operating segment is a component of the Group that engages in business activities from which it may earn revenues and 
incur expenses, including revenues and expenses that relate to transaction with any of the Group’s other components. An 
operating segment’s operating results are reviewed regularly by the Chief Executive Officer to make decisions about resources 
to be allocated to the segment and assess its performance, and for which discrete financial information is available.
Segment results that are reported to the Chief Executive Officer include items directly attributable to a segment, as well as 
those that can be allocated on a reasonable basis. Unallocated items comprise mainly central Group administration costs, 
interest, taxation, and bank loans. Annual Report 2011
22
20660-04 03/10/2011 Proof 6
Notes to the Accounts
Year ended 30 June 2011
2.  SIGNIFICANT ACCOUNTING POLICIES (continued)
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost comprises direct materials and, where applicable, 
direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and 
condition. Cost is calculated using the weighted average method. Net realisable value represents the estimated selling price 
less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.
Dividends
Dividends paid are recognised within the Statement of Changes in Equity only when an obligation to pay the dividend arises 
prior to the year end.
Share-based payments
The Group has applied the requirements of IFRS 2 Share-based Payment. In accordance with the transitional provisions, 
IFRS 2 has been applied to all grants of equity instruments after 7 November 2002 that were unvested at 1 January 2005.
The Group issues equity-settled share-based payments to certain employees. Equity-settled share-based payments are 
measured at fair value (excluding the effect of non market-based vesting conditions) at the date of grant. The fair value 
determined at the grant date of such equity-settled share-based payments is expensed on a straight-line basis over the 
vesting period, based on the Group’s estimate of shares that will eventually vest and adjusted for the effect of non market 
based vesting conditions (with a corresponding movement in equity).
Fair value is measured by use of the Black–Scholes model. The expected life used in the model has been adjusted, based 
on management’s best estimate, for the effects of non-transferability, exercise restrictions, and behavioural considerations.
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax.
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the 
statement of comprehensive income because it excludes items of income or expense that are taxable or deductible in other 
years and it further excludes items that are never taxable or deductible. The Group’s liability for current tax is calculated 
using tax rates that have been enacted or substantively enacted by the balance sheet date.
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets 
and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit, and 
is accounted for using the balance sheet liability method. Deferred tax liabilities are generally recognised for all taxable 
temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be 
available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if 
the temporary difference arises from the initial recognition of goodwill or from the initial recognition (other than in a business 
combination) of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no 
longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset 
is realised. Deferred tax is charged or credited in the statement of comprehensive income, except when it relates to items 
charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against 
current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to 
settle its current tax assets and liabilities on a net basis.  www.animalcaregroup.co.uk
Stock code: ANCR
23
20660-04 03/10/2011 Proof 6
Accounts
2.  SIGNIFICANT ACCOUNTING POLICIES (continued)
Property, plant and equipment
Land and buildings and other assets held for use in the production or supply of goods and services or for administrative 
purposes, fixtures and equipment are stated at cost less accumulated depreciation and any recognised impairment loss.
Other than for land, which is not depreciated, depreciation is charged so as to write off the cost of assets, less their 
estimated residual value, over their estimated useful lives, as follows:
Straight-line
Freehold Buildings 50 years
Leasehold improvements 10 years
Plant and equipment 4 to 7 years
Office furniture and equipment 3 to 5 years
Motor vehicles 4 years
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, 
where shorter, over the term of the relevant lease.
The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the net sales 
proceeds and the carrying amount of the asset and is recognised in the statement of comprehensive income as incurred.
Provisions
Provisions are recognised when the Group has a present obligation as a result of a past event, and it is probable that the 
Group will be required to settle that obligation. Provisions are measured at the directors’ best estimate of the expenditure 
required to settle the obligation outstanding at the balance sheet date, and are discounted to present value where the effect 
is material.
Impairment of tangible and intangible assets excluding goodwill
At each balance sheet date, the Group reviews the carrying amounts of its tangible and intangible assets to determine 
whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the 
recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the 
asset does not generate cash flows that are independent from other assets, the Group estimates the recoverable amount 
of the cash-generating unit (CGU) to which the asset belongs. An intangible asset with an indefinite useful life is tested for 
impairment annually and whenever there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated 
future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market 
assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have 
not been adjusted.
If the recoverable amount of an asset (CGU) is estimated to be less than its carrying amount, the carrying amount of the 
asset (CGU) is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately.
Where an impairment loss subsequently reverses, the carrying amount of the asset (CGU) is increased to the revised 
estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that 
would have been determined had no impairment loss been recognised for the asset (CGU) in prior years. A reversal of an 
impairment loss is recognised as income immediately. Annual Report 2011
24
20660-04 03/10/2011 Proof 6
Notes to the Accounts
Year ended 30 June 2011
2.  SIGNIFICANT ACCOUNTING POLICIES (continued)
Financial instruments
Financial assets and financial liabilities are recognised in the Group’s balance sheet when the Group becomes a party to the 
contractual provisions of the instrument.
Trade receivables
Trade receivables are measured at initial recognition at fair value, and are subsequently measured at amortised cost 
using the effective interest rate method. Appropriate allowances for estimated irrecoverable amounts are recognised in 
comprehensive income when there is objective evidence that the asset is impaired. The allowance recognised is measured 
as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at 
the effective interest rate computed at initial recognition.
Investments
Investments in Group companies are stated at cost less provisions for impairment losses.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, deposits repayable on demand, and other short-term highly liquid 
investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value.
Bank borrowings
Interest-bearing bank loans and overdrafts are recorded at the proceeds received, net of direct issue costs. Finance 
charges, including premiums payable on settlement or redemption and direct issue costs, are accounted for on an accrual 
basis in comprehensive income using the effective interest rate method and are added to the carrying amount of the 
instrument to the extent that they are not settled in the period in which they arise.
Financial liabilities and equity
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. 
An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities.
Trade payables
Trade payables are initially measured at fair value, and are subsequently measured at amortised cost, using the effective 
interest rate method.
Derivative financial instruments
The Group uses derivative financial instruments including interest rate swaps to hedge its exposure to interest rate risks arising 
from operational and financial activities. The Group does not hold any derivative financial instruments for trading purposes. 
However, derivative financial instruments that do not qualify for hedge accounting are accounted for as trading instruments.
Hedge accounting is not adopted and therefore the movement on re-measurement to fair value is recognised immediately as 
part of finance income or finance costs in the Consolidated Statement of comprehensive income. Derivatives not designated 
into an effective hedge relationship are classified as a current asset or current liability. Fair value movements on interest rate 
hedging are included within “exceptional and other items” on the face of the statement of comprehensive income. www.animalcaregroup.co.uk
Stock code: ANCR
25
20660-04 03/10/2011 Proof 6
Accounts
3.  CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY
Critical judgements in applying the Group’s accounting policies
In the process of applying the Group’s accounting policies, which are described in note 2, management has made the 
following judgements that have the most significant effect on the amounts recognised in the financial statements (apart from 
those involving estimations, which are dealt with below).
Capitalised research & development expenditure
It is the Group’s policy to capitalise development expenditure and to amortise this expenditure over the estimated life of the 
asset. Expenditure incurred to date relates primarily to the following:
— certain costs associated with preparing regulatory dossiers in support of applications for generic veterinary medicine 
Marketing Authorisations.
The directors have adjudged these costs to meet the relevant criteria of IAS 38 “Intangible Assets”.
Capitalised software expenditure
The Group has historically capitalised software projects and developments. Expenditure on a bespoke web based system, 
designed to facilitate online ordering of its products, is currently capitalised in the Group’s financial statements as the 
directors have adjudged it to meet the relevant criteria.
The rate of depreciation on capitalised software is set so as to reflect the pattern of usage and the level of pace of change 
within the global information technology market.
Key sources of estimation uncertainty
Impairment of non-current assets
Determining whether a non-current asset is impaired requires an estimation of the “value in use” and/or the “fair value less 
costs to sell” of the cash-generating units (“CGUs”) to which the non-current asset has been allocated. The value in use 
calculation requires an estimate of the future cash flows expected to arise from the CGU and a suitable discount rate in order 
to calculate present value. The key assumptions for these value in use calculations are those regarding discount rates, growth 
rates and expected changes to selling prices and direct costs. The directors estimate the discount rates using the pre-tax rates 
that reflect the current market assessments of the time value of money and the risks specific to the CGU. In the current year 
the directors estimated the applicable rate to be 12 per cent (2010 — 12 per cent). The directors’ sensitivity analysis indicates 
that the headroom in the impairment test of 12 per cent is robust to significant changes in discount factors.
The Group prepares cash flow forecasts derived from the most recent financial budgets and projections approved by 
management for the next three years, thereafter assuming an estimated growth rate of 1.0% (2010 — 2.0%). The growth rates 
for the three year period covered by financial budgets and projections prepared by management are based on the current 
performance of the existing product portfolio and the contribution from new products, currently in development, which will be 
launched in the short-term. The directors believe that the long-term growth rate does not exceed the average long-term growth 
rate for the relevant markets.
Impairment of slow moving and obsolete inventory
The Group performs an annual stockholding review to determine any slow moving or obsolete lines and accordingly makes 
provision in its financial statements for writing down or writing off the value of such lines in order to reflect the true value of 
its stock. Annual Report 2011
26
20660-04 03/10/2011 Proof 6
Notes to the Accounts
Year ended 30 June 2011
4.  CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME — DISCONTINUED OPERATIONS
On 17 September 2010 the Company disposed of the business and assets of its trading division, Ritchey, and the shares of 
its wholly owned subsidiary Fearing International (Stock Aids) Limited. On 17 November 2010 the Group sold the trade and 
certain assets of its loss making subsidiary Travik Chemicals Limited (now Naychem Limited). These sales comprised the 
whole of the Group’s Livestock Division. 
Note
Total
2011
£’000 
Underlying 
results before 
exceptional 
and other 
items
2010
£’000
Exceptional 
and other 
items* 
2010
£’000
Total
2010
£’000 
Revenue  2,038  8,698  —  8,698 
Cost of sales   (923) (3,965) (181) (4,146)
Gross profit/(loss)  1,115  4,733  (181) 4,552 
Distribution costs  (84) (367) —  (367)
Administrative expenses   (883) (3,822) (2,958) (6,780)
Operating profit/(loss) 6, 8 148  544  (3,139) (2,595)
Finance costs  (3) (7) —  (7)
Profit/(loss) before tax 6, 8 145  537  (3,139) (2,602)
Income tax (expense)/credit (7) (38) 203  165 
Profit/(loss) after tax for the period 
from discontinued operations   138  499  (2,936) (2,437)
Loss on sale of discontinued operations 5 (94) —  —  — 
Income tax credit on loss on sale of 
discontinued operations 61  —  —  — 
Total comprehensive (loss)/profit 
for the period from discontinued 
operations   105  499  (2,936) (2,437)
* In order to aid understanding of underlying business performance, the directors have presented underlying results  
 before the effect of exceptional and other items. Underlying measures exclude, where applicable, amortisation of acquired  
 intangibles, impairment of goodwill, fair value movements on interest hedging, impairments to current and non-current  
 assets and other charges relating to Group reorganisation. These exceptional and other items are analysed in detail in  
 note 6 to these financial statements. There were no exceptional or other items relating to discontinued operations during  
 the year ended 30 June 2011. www.animalcaregroup.co.uk
Stock code: ANCR
27
20660-04 03/10/2011 Proof 6
Accounts
5.  DISPOSAL OF BUSINESSES
Ritchey & 
Fearing
2011
£’000
Travik
2011
£’000
Total
2011
£’000
Consideration and Costs
Cash consideration 2,520  299  2,819 
Costs (95) (18) (114)
  2,425  280  2,705 
Assets and liabilities disposed of:
Goodwill 316  —  316 
Other intangible assets 102  —  102 
Property, plant and equipment 807  227  1,034 
Inventories 1,026  39  1,065 
Trade and other receivables 1,165  —  1,165 
Trade and other payables (733) —  (733)
Income tax payable (29) —  (29)
Deferred taxation (110) (11) (121)
Net assets sold 2,544  255  2,799 
(Loss)/profit on sale of businesses  (119) 25  (94)
Net cash flow from operating activities 200 (336) (136)
Net cash used in investing activities (3) — (3)
Net cash used in financing activities (180) — (180) Annual Report 2011
28
20660-04 03/10/2011 Proof 6
Notes to the Accounts
Year ended 30 June 2011
6.  EXCEPTIONAL AND OTHER ITEMS
In early 2010 the Group undertook a strategic review of its Livestock Division activities, given its financial performance and 
the ongoing challenges it faced in the market. This review resulted in the directors forming the view that the fair value less 
costs to sell of the Livestock division exceeded the value in use,and that an impairment charge was necessary. These 
considerations resulted in exceptional charges for 2010.
Note
2011
£’000
2010
£’000
Charges relating to the reorganisation of the Group
Aborted group relocation costs —  69 
Executive severance payments —  212 
    —  281 
Impairments and other charges relating to the Ritchey and 
Fearing businesses
Impairment of goodwill 15 —  2,165 
Impairment of other intangible assets 16 —  115 
Impairment of property, plant and equipment 17 —  225 
Other charges —  59 
    —  2,564 
Impairments and restructuring charges relating to the Travik 
Chemicals business
Impairment of goodwill 15 —  62 
Impairment of property, plant and equipment 17 —  371 
Inventory provisions —  181 
Release of contingent consideration —  (39)
    —  575 
Total exceptional items   —  3,420 
    
Amortisation of acquired intangible assets 16 118  120 
Fair value movements on interest rate hedging 11 1  38 
Other items   119  158 
Total exceptional and other items   119  3,578 
The charges relating to the reorganisation of the Group and the other items relate to continuing operations, the remainder to 
discontinued operations.  www.animalcaregroup.co.uk
Stock code: ANCR
29
20660-04 03/10/2011 Proof 6
Accounts
7.  REVENUE AND OPERATING SEGMENTS
IFRS 8 requires operating segments to be identified on the basis of internal reports about components of the Group that 
are regularly reviewed by the Chief Operating Decision Maker to allocate resources to the segments and to assess their 
performance. The Chief Operating Decision Maker is considered to be the Chief Executive Officer of Animalcare Group plc.
The Group comprised two segments, Companion Animal and Livestock (discontinued).
The Chief Operating Decision Maker receives and reviews segmental operating profit. 
Intersegment transactions are undertaken in the ordinary course of business.
The Board considers that certain items are cross divisional in nature and cannot be allocated between the segments on 
a meaningful basis. The administrative costs of central group management are presented as unallocated in the following 
tables, as this entity has trading relationships with companies in both the segments.
Net funding costs and taxation are treated as unallocated reflecting the nature of the Group’s borrowing facilities and its  
tax group.
Each segment is shown net of intercompany transactions and balances within that segment. The eliminations remove 
intercompany transactions and balances between the segments.
Principal activities were as follows:
The Companion Animal Division supplies and distributes veterinary medicines, identification and other welfare products to 
veterinary markets; and
The Livestock Division manufactured and distributed livestock identification and welfare products to agricultural merchants, 
retailers and farmers. Following disposals during the year the whole of the Livestock Division is a discontinued operation. Annual Report 2011
30
20660-04 03/10/2011 Proof 6
Notes to the Accounts
Year ended 30 June 2011
7.  REVENUE AND OPERATING SEGMENTS (continued)
2011 Note
Companion 
Animal
(continuing)
2011
£’000
Livestock
(dis-
continued)
2011
£’000
Eliminations
2011
£’000
Segment 
Total
2011
£’000
Unallocated
2011
£’000
Total
2011
£’000
Revenue
External sales  11,812  2,038  —  13,850  —  13,850 
Inter-segment sales   13  —  (13) —   — 
Total revenue   11,825  2,038  (13) 13,850  —  13,850 
Gross profit   6,390  1,115  —  7,505  —  7,505 
Underlying operating profit/(loss) 3,426  148  —  3,574  (373) 3,201 
Other items 6 (118) —  —  (118) —  (118)
Operating profit — 
discontinued operations 4 (148)
Operating profit    2,935
Finance income 11 2 
Finance costs 11 (52)
Profit before tax             2,885 
2010 Note
Companion 
Animal
(continuing)
2010
£’000
Livestock
(dis-
continued)
2010
£’000
Eliminations
2010
£’000
Segment 
Total
2010
£’000
Unallocated
2010
£’000
Total
2010
£’000
Revenue
External sales  11,156  8,765  —  19,921  —  19,921 
Inter-segment sales   67  4  (71) —   — 
Total revenue   11,223  8,769  (71) 19,921  —  19,921 
Gross profit   5,957  4,733  —  10,690  —  10,690 
Underlying operating profit/(loss) 2,873  545  —  3,418  (276) 3,142 
Other items 6 (120) —  —  (120) —  (120)
Exceptional items 6 —  (3,139) —  (3,139) (281) (3,420)
Operating profit — 
discontinued operations 4 (545)
Exceptional items — 
discontinued operations 4 3,139
Operating profit    2,196
Finance income 11 16 
Finance costs 11 (168)
Profit before tax             2,044 www.animalcaregroup.co.uk
Stock code: ANCR
31
20660-04 03/10/2011 Proof 6
Accounts
7.  REVENUE AND OPERATING SEGMENTS (continued)
2011 Note
Companion 
Animal
(continuing)
2011
£’000
Livestock
(dis-
continued)
2011
£’000
Eliminations
2011
£’000
Segment 
Total
2011
£’000
Unallocated
2011
£’000
Total
2011
£’000
Products and Services
Licensed veterinary  5,784  —  —  5,784  — 5,784
Animal identification 3,232 907 (13) 4,126 — 4,126
Animal welfare  2,809 916 — 3,725 — 3,725
Other   —  215  —  215  —  215 
    11,825 2,038 (13) 13,850 — 13,850
Other information
Intangible asset additions 16 134  —  —  134  —  134 
Property, plant and equipment 
additions 17 16  3  —  19  —  19 
Depreciation and amortisation 16,17 333  72  —  405  —  405 
Consolidated assets   18,784  — — 18,784  —  18,784 
Consolidated liabilities   (2,995) — —  (2,995) —  (2,995)
Consolidated net assets   15,789 — —  15,789  —  15,789 
2010 Note
Companion 
Animal
(continuing)
2010
£’000
Livestock
(dis-
continued)
2010
£’000
Eliminations
2010
£’000
Segment 
Total
2010
£’000
Unallocated
2010
£’000
Total
2010
£’000
Products and Services
Licensed veterinary  5,373  —  —  5,373  —  5,373 
Animal identification  2,980  3,903  (67) 6,816  —  6,816 
Animal welfare  2,870  3,943  (4) 6,809  —  6,809 
Other   —  923  —  923  —  923 
    11,223  8,769  (71) 19,921  —  19,921 
Other information
Intangible asset additions 16 338  69  —  407  — 407
Property, plant and equipment 
additions 17 8  197  —  205  —  205 
Depreciation and amortisation 16,17 296  299  —  595  —  595 
Impairment of intangible assets 16 —  115  —  115  —  115 
Impairment of property, plant 
and equipment 17 —  159  —  159  —  159 
Goodwill impairment charge 6 —  2,227  —  2,227  —  2,227 
Consolidated assets   19,439  4,731  (1,088) 23,082  —  23,082 
Consolidated liabilities   (3,119) (2,514) 1,088  (4,545) (4,456) (9,001)
Consolidated net assets   16,320  2,217  —  18,537  (4,456) 14,081  Annual Report 2011
32
20660-04 03/10/2011 Proof 6
Notes to the Accounts
Year ended 30 June 2011
7.  REVENUE AND OPERATING SEGMENTS (continued)
Key customers 2011 2010
Number 3 3
Percentage of total revenue 86% 84% 
Key customers, all within the Companion Animal segment, are those responsible for 10% or more of segmental revenue.
2011
£’000
2010
£’000
Geographical market  
United Kingdom 12,879  18,061 
Other European countries 984  1,706 
Americas —  41 
Australia —  2 
Rest of the World —  11 
 13,863  19,921 
All the Group’s assets are wholly located in the United Kingdom and accordingly no geographical analysis of assets and 
liabilities is presented.
An analysis of total Group revenue is as follows:
2011
£’000
2010
£’000
Revenue from sale of goods 12,873 19,045
Revenue from provision of services 990 876
 13,863  19,921 
Finance income 2  16 
13,865 19,937
8.  TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR
2011
£’000
2010
£’000
Total comprehensive income/(loss) for the year has been arrived at after charging/(crediting):
Cost of inventories recognised as expense 6,309 9,128
Depreciation of tangible assets 88 287
Amortisation of developed intangible assets 317 188
Research and development 86 187
Operating lease rentals 185 250
Profit on disposal of tangible assets (2) (16)
Loss on sale of businesses 94 — 
Foreign exchange (gains)/losses (12) 46
Decrease in provision for receivables (13) (35)
(Decrease)/Increase in provision for inventories  (143) 104 
The above items are those charged/(credited) to total comprehensive income only. Full details on items charged/(credited) to 
exceptional and other items are contained in note 6. www.animalcaregroup.co.uk
Stock code: ANCR
33
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Accounts
8.  TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE YEAR (continued)
The analysis of remuneration paid to the Company’s auditors is as follows:
2011
£’000
2010
£’000
Fees payable to the Company’s auditors for the audit of the Company’s annual accounts  18  15 
Fees payable to the Company’s auditors for other services to the Group  15  — 
The audit of the Company’s subsidiaries pursuant to legislation  16  19 
Total audit fees  49  34 
Tax services  9  15 
Other services  12  — 
Total non-audit fees  21  15 
Total auditors’ remuneration  70  49 
9.  DIRECTORS’ REMUNERATION AND INTERESTS
Emoluments
The various elements of remuneration received by each director were as follows:
Year ended 30 June 2011
Salary
£’000
Bonus
£’000
Company 
pension 
contributions
£’000
Benefits
£’000
Compensation 
for loss of 
office
£’000
Total
£’000
J S Lambert* 30  —  —  —  —  30 
Lord Downshire* 20  —  —  2  —  22 
S M Wildridge 143  26  16  —  —  185 
P O R Warner (appointed
13 October 2010) 61  18  5  1  —  85 
G C Rhodes* (resigned
30 November 2010) 9  —  —  1  —  10 
J Tobin (resigned
31 December 2010) 43  —  21  —  35  99 
Total 306  44  42  4  35  431 
Year ended 30 June 2010
J S Lambert* 30  —  —  —  —  30 
Lord Downshire* 20  —  —  1  —  21 
S M Wildridge 103  19  18  —  —  140 
G C Rhodes* 20  —  —  2  —  22 
S F Riddell (resigned
31 March 2010) 82  19  10  —  135  246 
J Tobin 93  11  8  2  —  114 
Total 348  49  36  5  135  573 
* Indicates non-executive directors.
All Company pension contributions relate to defined contribution pension schemes. Benefits consisted of private medical 
insurance. Compensation for loss of office was paid in cash.
Notes to the Accounts
Year ended 30 June 2011 Annual Report 2011
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20660-04 03/10/2011 Proof 6
9.  DIRECTORS’ REMUNERATION AND INTERESTS (continued)
Share options
The directors had the following beneficial options:
S M Wildridge
Scheme EMI Unapproved Unapproved Unapproved Total
Exercise Price £0.575 £0.575 £0.575 £0.975  
Date of Grant 02 July 2008 02 July 2008 03 July 2008 09 July 2009  
Outstanding at 1 July 2009 200,000  100,000  100,000  —  400,000 
Granted during the year  — — — 100,000  100,000 
Outstanding at 30 June 2010 200,000  100,000  100,000  100,000  500,000 
Exercised during the year (110,500) —  —  —  (110,500)
Outstanding at 30 June 2011 89,500  100,000  100,000  100,000  389,500 
J Tobin
Scheme EMI Total
Exercise Price £0.975  
Date of Grant 28 Sept 2009  
Granted during the year 50,000 50,000
Outstanding at 30 June 2010 50,000  50,000 
Lapsed during the year (50,000) (50,000)
Outstanding at 30 June 2011 —  — 
P O R Warner
Scheme EMI SAYE EMI Total
Exercise Price £0.575 £0.440 £0.975 
Date of Grant 02 July 2008 19 Aug 2008 09 July 2009
On appointment 5,000  1,709  5,000  11,709 
Exercised during the year (5,000) — — (5,000)
Outstanding at 30 June 2011 —  1,709  5,000  6,709 
The directors’ interests in the shares of the Company as at 30 June are set out below.
Ordinary 
shares
of 20p
2011
Ordinary 
shares
of 20p
2010
J S Lambert 1,286,691 1,196,691
Lord Downshire 1,019,583 1,109,583
S M Wildridge 129,568 319,068
P O R Warner 5,000 n/a
In addition to the above, Lord Downshire had a non-beneficial interest in 310,446 shares.
G C Rhodes, who resigned as a director on 30 November 2010, had interests in 582,000 shares of the Company at  
30 June 2010.
Notes to the Accounts
Year ended 30 June 2011 www.animalcaregroup.co.uk
Stock code: ANCR
35
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Accounts
10.  STAFF COSTS
2011
No.
2010
No.
Number of employees
The average monthly number of employees (including directors) during the year was:
Production and distribution  13  39 
Selling and administration 70  113 
  83  152 
2011
£’000
2010
£’000
Related costs
Wages and salaries 2,015 3,485 
Social security costs 196  360 
Other pension costs  99  129 
  2,310 3,974 
11.  FINANCE COSTS AND FINANCE INCOME
Note
2011
£’000
2010
£’000
Interest expense on financial liabilities held at amortised cost:
Bank interest  54  137 
Fair value losses on financial instruments* 23 1  38 
Finance costs   55  175 
Other net finance income
Interest income on bank deposits  (2) (16)
Finance income   (2) (16)
Net finance costs   53  159 
Finance costs above include the following amounts relating to discontinued operations:
Bank interest   3  7 
* Finance costs arising from derivatives held at fair value through profit and loss relate to fair value movements on the Group  
 interest rate swap. The costs are included within “other items” on the face of the statement of comprehensive income. Annual Report 2011
36
20660-04 03/10/2011 Proof 6
12.  INCOME TAX EXPENSE
Note
2011
£’000
2010
£’000
The income tax expense/(credit) comprises:
Current tax expense  728  712 
Adjustment in the current year in relation to prior years   (53) (25)
 675  687 
The deferred tax credit comprises:
Origination and reversal of temporary differences 25 (64) (214)
Adjustment in the current year in relation to prior years 25 —  — 
  (64) (214)
Total tax expense for the year   611  473 
The total tax expense for the year comprises:
Income tax expense in the statement of comprehensive income   665 638
Income tax expense/(credit) on discontinued operations  4 7 (165)
Income tax credit on loss on sale of discontinued operations 4 (61) — 
Total tax expense for the year 611 473
The total tax charge can be reconciled to the accounting profit as follows: 
Total comprehensive income/(loss) for the year 2,325  (1,031)
Total tax expense 611  473 
Profit before tax   2,936  (558)
Income tax calculated at 27.5% (2010 — 28%)    807 (156) 
Effect of expenses not deductible 3 26
Effect of share-based deductions (80) (51)
Effect of goodwill impairments not deductible — 623
Effect of reduction in deferred tax rate from 28% to 26% (32) (5)
Effect of unprovided temporary differences (2) 61
Effect of write back of deferred tax liabilities (32) —
Effect of adjustments to the income tax expense of earlier years (53) (25)
611 473
The tax credit of £52,000 (2010 — £326,000) shown within “exceptional and other items” on the face of the statement of 
comprehensive income relates to the amortisation of acquired intangibles, fair value movements on interest rate hedging, 
impairments to non-current assets and other charges relating to Group reorganisation, details of which are contained in note 6.
During the year the Group has reflected the change in the enacted tax rate from 28 per cent to 26 per cent, which is effective from 
1 April 2011. The Government has also indicated that it intends to enact future reductions in the main tax rate of 1 per cent each 
year down to 23 per cent by 1 April 2014. A further reduction in the rate to 25 per cent was substantively enacted on 5 July 2011. 
The future 1 per cent main tax rate reductions are not expected to have a material impact on the financial statements.
13.  DIVIDENDS
2011
£’000
2010
£’000
Ordinary final dividend paid for the year ended 30 June 2010 609 494
Ordinary interim dividend paid for the year ended 30 June 2011 203 — 
812 494
The final dividend paid during the year ended 30 June 2011 was 3.0 pence per share (2010 — 2.5 pence per share). The 
interim dividend paid during the year ended 30 June 2011 was 1.0 pence per share (2010 — nil).
The proposed final dividend is subject to approval from shareholders at the Annual General Meeting and has not been 
included as a liability in these financial statements.
Notes to the Accounts
Year ended 30 June 2011 www.animalcaregroup.co.uk
Stock code: ANCR
37
20660-04 03/10/2011 Proof 6
Accounts
14.  EARNINGS PER SHARE
Basic earnings/(loss) per share amounts are calculated by dividing the total comprehensive income/(loss) for the year 
attributable to ordinary equity holders of the Company by the weighted average number of fully paid ordinary shares 
outstanding during the year.
The dilutive effect of share options is calculated by adjusting the weighted average number of ordinary shares outstanding 
to assume conversion of all dilutive potential ordinary shares. The only dilutive potential ordinary shares of the Company 
are share options. A calculation is done to determine the number of shares that could have been acquired at fair value 
(determined as the average annual market price of the Company’s shares) based on the monetary value of the subscription 
rights attached to the outstanding share options.
The following income and share data was used in the earnings per share computations:
Underlying 
earnings 
before 
exceptional 
and other 
items
2011
£’000
Underlying 
earnings 
before 
exceptional 
and other 
items
2010
£’000
Total 
earnings
2011
£’000
Total 
(loss)/
earnings
2010
£’000
Total comprehensive income/(loss) attributable to equity 
holders of the Company  2,392  2,221  2,325  (1,031)
Total comprehensive income from continuing operations 
attributable to equity holders of the Company 2,287 1,722 2,220 1,406
Total comprehensive income/(loss) from discontinued 
operations attributable to equity holders of the Company 105 499 105 (2,437)
2011
No.
2010
No.
2011
No.
2010
No.
Basic weighted average number of shares 20,225,635 19,870,419 20,225,635 19,870,419
Dilutive potential ordinary shares 239,891 348,218 239,891 348,218
Fully diluted weighted average number of shares 20,465,526 20,218,637 20,465,526 20,218,637
Total earnings/(loss) per share:
Basic 11.8p 11.2p 11.5p (5.2p)
Fully diluted 11.7p 11.0p 11.4p (5.2p)
Earnings per share from continuing operations:
Basic 11.3p 8.7p 11.0p 7.1p
Fully diluted 11.2p 8.5p 10.8p 7.0p
Earnings/(loss) per share from discontinued operations:
Basic 0.5p 2.5p 0.5p (12.3p)
Fully diluted 0.5p 2.5p 0.5p (12.3p)
The potential ordinary shares in the previous year did not increase the loss per share. Annual Report 2011
38
20660-04 03/10/2011 Proof 6
15.  GOODWILL
Group
£’000 
Company
£’000
Cost
At 1 July 2010 and 1 July 2009 15,949  715 
Disposals (3,238) (715)
At 30 June 2011 12,711  — 
Accumulated impairment losses
At 1 July 2009 695  695 
Impairment losses for the year 2,227  20 
At 30 June 2010 2,922 715
Disposals (2,922) (715)
At 30 June 2011 — —
Net book value
At 30 June 2011 12,711 —
At 30 June 2010 13,027 —
The carrying amount of Group goodwill is allocated as follows:
2011
£’000 
2010
£’000
Companion Animal 12,711 12,711 
Livestock — 316
Goodwill 12,711  13,027 
The directors modelled a range of different scenarios by applying sensitivities to both the cash flow assumptions and the 
discount rate. Based on this sensitivity analysis there is significant headroom between the value in use calculation and the 
carrying value of the cash generating unit (“CGU”).
The impairment test of the goodwill allocated to the Companion Animal segment was based on value in use. The value in 
use was determined by discounting the future cash flows to be generated from the continuing use of the CGU.
The Group prepares cash flow forecasts derived from the most recent financial budgets and projections approved by 
management for the next three years and thereafter assuming an estimated annual growth rate of 1.0 per cent 
(2010 — 2.0 per cent).
The financial budgets and projections are based on past experience and actual operating results. The growth rates for the 
three year period are based on current performance of the existing product portfolio and the contribution from new products 
currently in development which will be launched in the short term. The directors consider the growth rate to be modest 
based on historical performance. The directors believe that the long-term growth rate does not exceed the average long-
term growth rate for the UK economy.
The directors estimate the discount rates using the pre-tax rates that reflect the current market assessments of the time 
value of money and the risks specific to the CGU. In the current year the directors estimated the applicable rate to be 12 per 
cent (2010 — 12 per cent). The directors’ sensitivity analysis indicates that the headroom in the impairment test at 12 per 
cent is robust to significant changes in discount factors.
The impairment recognised in the prior year of £2,227,000 related entirely to the Livestock segment. The recoverable 
amount was calculated based on fair value less cost to sell. The estimate of fair value was substantiated by reference to the 
subsequently agreed disposal proceeds.
Notes to the Accounts
Year ended 30 June 2011 www.animalcaregroup.co.uk
Stock code: ANCR
39
20660-04 03/10/2011 Proof 6
Accounts
16.  OTHER INTANGIBLE ASSETS
Group
Acquired 
brands and 
customer 
relationships
£’000
New product 
development 
costs
£’000
Capitalised 
software
£’000
Total
£’000
Cost
At 1 July 2009 1,361  947  245  2,553 
Additions  —  407  —  407 
Reclassification to tangible assets —  (18) —  (18)
Disposals —  —  (36) (36)
At 1 July 2010 1,361  1,336  209  2,906 
Additions —  92  42  134 
Sale of business —  (200) (210) (410)
At 30 June 2011 1,361  1,228  41  2,630 
Amortisation
At 1 July 2009 177  97  140  414 
Charge for the year  120  138  50  308 
Impairment* —  115  —  115 
Disposals —  —  (36) (36)
At 1 July 2010 297  350  154  801 
Charge for the year  118  188  11  317 
Sale of business —  (145) (163) (308)
Disposals —  —  —  — 
At 30 June 2011 415  393  2  810 
Carrying value
At 30 June 2011 946  835  39  1,820 
At 30 June 2010  1,064  986  55  2,105 
Veterinary medicine product development costs are amortised over 5 years, acquired brands are amortised over 15 years 
and acquired customer relationships are amortised over 10 years. The amortisation period for capitalised software relating 
to the bespoke online ordering system was four years.
Tooling with a cost and net book value of £18,000 previously classified as an intangible asset was reclassified during 2010 
as property, plant and equipment.
* The impairment charge related to development costs incurred on the Company’s livestock ear tag applicator and EID  
 tagging system developments and was treated as an exceptional cost in 2010. Further details are contained in note 6. Annual Report 2011
40
20660-04 03/10/2011 Proof 6
16.  OTHER INTANGIBLE ASSETS (continued)
Company
Product 
development 
costs
£’000
Capitalised 
software
£’000
Total
£’000
Cost
At 1 July 2009 131  245  376 
Additions  14  55  69 
Disposals —  (36) (36)
At 1 July 2010 145  264  409 
Additions  —  1  1 
Sale of Business (145) (265) (410)
At 30 June 2011 —  —  — 
Amortisation
At 1 July 2009 10  140  150 
Charge for the year 13  50  63 
Impairment* 115  115 
Disposals —  (36) (36)
At 1 July 2010 138  154  292 
Charge for the year 7  9  16 
Sale of Business (145) (163) (308)
At 30 June 2011 —  —  — 
Carrying value
At 30 June 2011 —  —  — 
At 30 June 2010 7  110  117 
* The impairment charge related to development costs incurred on the Company’s livestock ear tag applicator and EID  
 tagging system developments and has been treated as an exceptional cost in 2010. Further details are contained in note 6.
Notes to the Accounts
Year ended 30 June 2011 www.animalcaregroup.co.uk
Stock code: ANCR
41
20660-04 03/10/2011 Proof 6
Accounts
17.  PROPERTY, PLANT AND EQUIPMENT
Group
Freehold land 
and buildings 
£’000
Leasehold 
improvements
£’000
Plant and 
equipment
£’000
Office 
furniture and 
equipment
£’000
Motor 
Vehicles
£’000
Total
£’000
Cost
At 1 July 2009 1,268  73  1,717  627  65  3,750 
Additions  —  —  158  47  —  205 
Reclassification from 
intangible assets —  —  18  —  —  18 
Disposals  —  —  (19) (124) (14) (157)
At 1 July 2010 1,268  73  1,874  550  51  3,816 
Additions  —  —  10  8  —  18 
Sale of businesses (1,268) (73) (1,821) (480) (19) (3,661)
Disposals — —  —  —  (9) (9)
At 30 June 2011 —  —  63  78  23  164 
Depreciation
At 1 July 2009 301  38  1,215  353  26  1,933 
Impairment* 32  8  118  104  25  287 
Charge for the year  276  —  265  55  —  596 
On disposals —  —  (15) (125) (13) (153)
At 1 July 2010 609  46  1,583  387  38  2,663 
Charge for the year  8  1  36  35  8  88 
Sale of businesses (617) (47) (1,589) (357) (17) (2,627)
On disposals — —  —  (7) (7)
At 30 June 2011 —  —  30  65  22  117 
Net book value
At 30 June 2011 —  —  33  13  1  47 
At 30 June 2010 659  27  291  163  13  1,153 
Tooling with a cost and net book value of £18,000 previously classified as an intangible asset was reclassified during 2010 
as property, plant and equipment.
* The impairment charge has been treated as an exceptional cost in 2010. Further details are contained in note 6. Annual Report 2011
42
20660-04 03/10/2011 Proof 6
17.  PROPERTY, PLANT AND EQUIPMENT (continued)
Company
Freehold 
land and 
buildings
£’000 
Plant and 
equipment
£’000
Office 
furniture 
and 
equipment
£’000
Motor 
Vehicles
£’000
Total
£’000
Cost
At 1 July 2009 718  1,455  470  8  2,651 
Additions  —  144  30  —  174 
Disposals —  (18) (91) —  (109)
At 1 July 2010 718  1,581  409  8  2,716 
Additions  —  —  1  —  1 
Sale of Business (718) (1,581) (410) (8) (2,717)
At 30 June 2011 —  —  —  —  — 
Depreciation
At 1 July 2009 268  1,117  247  5  1,637 
Charge for the year 21  68  73  3  165 
Impairment* —  170  55  —  225 
On disposals  —  (13) (93) —  (106)
At 1 July 2010 289  1,342  282  8  1,921 
Charge for the year  3  15  17  —  35 
Sale of Business (292) (1,357) (299) (8) (1,956)
At 30 June 2011 —  —  —  —  — 
Net book value
At 30 June 2011 —  —  —  —  — 
At 30 June 2010  429  239  127  —  795 
* The impairment charge was treated as an exceptional cost during 2010. Further details are contained in note 6.
18.  INVESTMENTS IN SUBSIDIARIES
Subsidiary undertakings
2011
£’000
2010
£’000
At 1 July 2010 and 1 July 2009 17,384 17,384 
Disposals (3,023) — 
At 30 June 14,361 17,384
Accumulated impairment losses
At 1 July 2010 and 1 July 2009 2,108 —
Impairment losses for the year — 2,108
Disposals (2,108) —
At 30 June — 2,108
Net book value
At 30 June 14,361 15,276
Notes to the Accounts
Year ended 30 June 2011 www.animalcaregroup.co.uk
Stock code: ANCR
43
20660-04 03/10/2011 Proof 6
Accounts
18. INVESTMENTS IN SUBSIDIARIES (continued)
The disposal relates to Fearing International (Stock Aids) Limited which was sold in September 2010. The estimate of fair 
value less costs to sell for this business was substantiated by reference to the disposal proceeds as disclosed in note 5. 
The impairment charge related to the Company’s investments in Fearing International (Stock Aids) Limited and Naychem 
Limited (formerly Travik Chemicals Limited)  The impairments were calculated based on the recoverable amount determined 
as estimated fair value less costs to sell. 
The principal subsidiary undertakings of the Company are summarised below. The companies listed include all those which 
principally affected the earnings and assets of the Group.
Country of
registration or
incorporation Class
Shares held
%
Animalcare Limited England Ordinary 100
Naychem Limited England Ordinary 100
The principal activity of these undertakings for the last financial year was as follows:
  Principal activity 
Animalcare Limited Sale of companion animal products and services
Naychem Limited (formerly Travik Chemicals Limited) Manufacture and sale of liquid cleaning products
On 17 September 2010 the Company disposed of the shares of Fearing International (Stock Aids) Limited. On 17 November 
2010 the Company disposed of the trade and certain assets of Naychem Limited.
19. INVENTORIES
Group Company
2011
£’000
2010
£’000
2011
£’000
2010
£’000
Raw materials and consumables  —  188  —  153 
Finished goods and goods for resale  1,346  1,687  —  525 
  1,346  1,875  —  678 
In the directors’ opinion, the replacement cost of inventories is not materially different from their balance sheet value.
20. OTHER FINANCIAL ASSETS
Trade and other receivables
Group Company
2011
£’000
2010
£’000
2011
£’000
2010
£’000
Trade receivables  1,520  3,037  —  1,469 
Amounts receivable from subsidiaries  —  —  420  425 
Other receivables  35  175  8  129 
Prepayments and accrued income   126  206  8  68 
    1,681  3,418  436  2,091 
The directors consider that the carrying amount of trade and other receivables approximates to their fair value. Annual Report 2011
44
20660-04 03/10/2011 Proof 6
20.  OTHER FINANCIAL ASSETS (continued)
Movement in allowance for doubtful debts
Group Company
2011
£’000
2010
£’000
2011
£’000
2010
£’000
Balance at 1 July 20 55 15 18
Impairment losses recognised (15) (35) (15) (3)
Balance at 30 June 20 20 15 15
Ageing of past due but not impaired receivables
Group Company
2011
£’000
2010
£’000
2011
£’000
2010
£’000
1–30 days past due 61 133 — 20
31–90 days past due 8 33 — 3
91 days and more 5 29 — 5
  74 195 — 28
The Group has not provided for these as there has not been a significant change in the credit quality and the directors 
consider that the amounts are still recoverable.
Cash and cash equivalents
Group Company
2011
£’000
2010
£’000
2011
£’000
2010
£’000
Cash and cash equivalents 1,179 1,564 207 224
Cash and cash equivalents comprise cash and short-term bank deposits with an original maturity of three months of less.
The carrying amount of these assets approximates their fair value.
Credit risk
The Company’ s principal financial assets are bank balances and cash, and trade and other receivables. The Company’ s credit 
risk is primarily attributable to its trade receivables. The amounts presented in the balance sheet are net of allowances for doubtful 
receivables. An allowance for impairment is made where there is an identified loss event which, based on previous experience, is 
evidence of a reduction in the recoverability of the cash flows. The allowance for doubtful debts represents the difference between 
the carrying value of the specific trade receivables and the present value of the expected recoverable amount.
The average credit period on sales of goods is 40 days (2010 — 43 days). No interest has been charged on overdue 
receivables.
Notes to the Accounts
Year ended 30 June 2011 www.animalcaregroup.co.uk
Stock code: ANCR
45
20660-04 03/10/2011 Proof 6
Accounts
21. OTHER FINANCIAL LIABILITIES
Trade and other payables
Group Company
2011
£’000
2010
£’000
2011
£’000
2010
£’000
Trade payables  958  1,413  49  446 
Amounts payable to subsidiaries  —  —  61  1,286 
Other taxes and social security costs  273  536  45  246 
Other creditors 212  430  40  255 
Accruals 123  391  7  185 
  1,566  2,770  202  2,418 
The directors consider that the carrying amount of trade and other payables approximates their fair value.
22. BANK OVERDRAFTS AND LOANS
Group Company
2011
£’000
2010
£’000
2011
£’000
2010
£’000
Bank loans — 4,456 — 4,456
All borrowings were in UK sterling. The Group has an overdraft facility of £100,000 which is secured by a floating charge 
over the Group’s assets; the bank loans were secured by a fixed and floating charge over the Group’s assets. Interest on the 
bank loans was charged at 1.50 per cent above LIBOR (2010 — 1.50 per cent above LIBOR). The carrying values and fair 
value of the Group’s short-term and long-term borrowings are not considered materially different and are as follows:
Group Company
2011
£’000
2010
£’000
2011
£’000
2010
£’000
Secured borrowings at amortised cost
Bank loans due within one year  —  883  —  883 
Current liabilities —  883  —  883 
Secured borrowings at amortised cost
Bank loans due after one year —  3,573  —  3,573 
Non-current liabilities —  3,573  —  3,573 
The borrowings were repayable as follows:
Group Company
2011
£’000
2010
£’000
2011
£’000
2010
£’000
Loan maturity analysis
In more than one year but not more than two years  — 883 — 883
In more than two years but no more than five years  — 2,315 — 2,315
In more than five years  — 375 — 375
Amount due after more than one year  — 3,573 — 3,573
Amount falling due within one year — 883 — 883
  — 4,456 — 4,456 Annual Report 2011
46
20660-04 03/10/2011 Proof 6
22.  BANK OVERDRAFTS AND LOANS (continued)
Analysis of net funds and net debt
Net funds refers to the positive cash position of the Group after offsetting total borrowings from cash and cash equivalents, 
whereas references to net debt refer to net borrowings of the Group after offsetting cash and cash equivalents from total 
borrowings. Net debt and net funds are not terms defined under IFRS and may not be comparable with other similarly titled 
non-IFRS measures reported by other companies. The Group adopts these measures as they are used for internal debt 
analysis. In addition, the net debt balance provides an indication of the net borrowings on which the Group is required to 
pay interest.
2011
£’000
2010
£’000
Cash and cash equivalents  1,179  1,564 
Bank overdrafts and loans  —  (4,456)
Net funds/(debt)  1,179  (2,892)
23.  FINANCIAL INSTRUMENTS
Capital and liquidity risk management
At 30 June the Group was contractually obliged to make repayments of principal and payments of interest as detailed below:
2011
Within one year 
or on demand
£’000
1–2 years
£’000
3–5 years
£’000
More than 
5 years
£’000
Total
£’000
Trade and other payables  1,566  —  —  —  1,566 
2010
Bank borrowings  976  956  2,380  395  4,707 
Financial instruments at fair value 55  —  —  —  55 
Trade and other payables  2,770  —  —  —  2,770 
  3,801 956 2,380  395  7,532 
Categories and Fair Value of Financial Instruments
Carrying value
2011
£’000
2010
£’000
Financial assets
Trade and other receivables (including cash and cash equivalents)  2,734  4,983 
Financial liabilities
Derivative financial instruments (fair value through income statement)  —  (55)
Trade and other payables (1,566) (2,770)
Bank borrowings — (4,707)
  (1,566) (7,532)
The fair values of the Group’s financial assets and liabilities are not materially different from their carrying values. The fair 
values of derivative instruments are calculated using quoted prices. Where such prices are not available use is made of 
discounted cash flow analysis using the applicable yield curve for the duration of the instruments for non-optional derivatives 
and option pricing models for optional derivatives.
Notes to the Accounts
Year ended 30 June 2011 www.animalcaregroup.co.uk
Stock code: ANCR
47
20660-04 03/10/2011 Proof 6
Accounts
23.  FINANCIAL INSTRUMENTS (continued)
Foreign Currency Risk Management
The Group undertakes transactions denominated in foreign currencies which gives rise to the risks associated with 
currency exchange rate fluctuations. Exposures are managed by a combination of matching foreign currency income and 
expenditure, maintaining foreign currency deposits and the use of forward exchange contracts. The carrying value of the 
Group’s foreign currency assets and liabilities at the reporting date was:
Assets Liabilities
2011
£’000
2010
£’000
2011
£’000
2010
£’000
Euro  245  452  175  474 
US Dollar 29  52  234  355 
NZ Dollar 24  22  —  94 
Foreign Currency Sensitivity Analysis
At 30 June 2011 the Group is mainly exposed to the Euro and the US$. The following table details the effect of a 
10 per cent increase and decrease in the exchange rate of these currencies against Sterling when applied to outstanding 
monetary items denominated in foreign currency as at 30 June 2011. A positive number indicates that an increase in profit 
which would arise from a 10 per cent strengthening of Sterling against these currencies, a negative number indicates that a 
decrease in profit would arise.
Strengthening
£’000
Weakening
£’000
Euro (6) 8
US$ 12 (23)
Interest Rate Sensitivity Analysis
This sensitivity analysis was not performed as the Group had no exposure to interest rates for either derivatives or 
non-derivative instruments at the balance sheet date.
Forward Foreign Exchange Contracts
The Group had five (2010 — four) open foreign exchange contracts at 30 June 2011. The values are shown below.
2011
£’000
2010
£’000
Principal Value 245  471 
Fair Value —  — 
Capital Management
In line with the disclosure requirements of IAS 1, Presentation of Financial Statements, the Company regards its capital as 
being the issued share capital and reserves together with its banking facilities, used to manage short-term working capital 
requirements. Note 26 to the financial statements provides details regarding the Company’s share capital and movements 
in the year. There were no breaches of any requirements with regard to any relevant conditions imposed by the Company’s 
Articles of Association during the years under review. Annual Report 2011
48
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24.  DEFERRED INCOME
Deferred income arises from certain services sold by the Group’s subsidiary Animalcare Limited. In return for a single upfront 
payment, Animalcare Limited commits to a fixed term contract to provide certain database, pet reunification and other 
support services to customers. There is no contractual restriction on the amount of times the customer makes use of the 
service. At the commencement of the contract it is not possible to determine how many times the customer will make use 
of the services, nor does historical evidence provide indications of any future pattern of use. As such, income is recognised 
evenly over the term of the contract, currently 8 years.
Movements in the Group’s deferred income liabilities during the current and prior year are as follows:
2011
£’000
2010
£’000
Balance at the beginning of the period 991  883 
Income deferred to future periods 207  231 
Release of income deferred from previous periods (154) (123)
  1,044  991 
The deferred income liabilities fall due as follows:
2011
£’000
2010
£’000
Within one year 182  154 
After one year 862  837 
  1,044  991 
Income recognised during the year is set out below:
2011
£’000
2010
£’000
Income received 220  248 
Income deferred to future periods (207) (231)
Release of income deferred from previous periods 154  123 
Income recognised in the year 167  140 
Notes to the Accounts
Year ended 30 June 2011 www.animalcaregroup.co.uk
Stock code: ANCR
49
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Accounts
25.  DEFERRED TAX LIABILITIES
The following are the major components of the deferred tax liabilities/(assets) recognised by the Group, and the movements 
thereon, during the current and prior year.
Property, 
plant and 
equipment
£’000
Share-based
payments
£’000
Other
£’000
Intangible 
fixed assets
£’000
Total
£’000
At 1 July 2009  210 (71) (6) 331  464 
(Credit)/charge to income  (155) (23) 3 (39) (214)
At 1 July 2010 55 (94) (3) 292 250
Charge/(credit) to income 13 (28) 3 (52)  (64) 
Disposal of businesses (127) — — 6 (121)
At 30 June 2011 (59) (122) — 246  65 
As set out in note 12, the rate of corporation tax will be reducing to 25 per cent on 1 April 2012. A reduction of 1 per cent 
would reduce deferred tax liabilities, if applied at 30 June 2011, to £62,000.
The following are the major components of the deferred tax liabilities/(assets) recognised by the Company, and the 
movements thereon, during the current and prior year.
Accelerated 
tax 
depreciation
£’000
Share-based 
payments
£’000
Total
£’000
At 1 July 2009 107  (71) 36 
Credit to income  (49) (22) (71)
At 1 July 2010 58 (93) (35)
Credit to income —  (7) (7)
Disposal of businesses (114) — (114)
At 30 June 2011  (56) (100) (156)
As set out in note 12, the rate of corporation tax will be reducing to 25 per cent on 1 April 2012. A reduction of 1 per cent 
would reduce deferred tax assets, if applied at 30 June 2011, to £150,000.
26.  SHARE CAPITAL
2011
No.
2010
No.
Allotted, called up and fully paid ordinary shares of 20p each 20,373,711 20,047,516
2011
£’000
2010
£’000
Allotted, called up and fully paid ordinary shares of 20p each 4,075 4,010
During the year £65,000 (2010 — £59,000) of ordinary shares were issued for proceeds of £179,000 (2010 — £166,000)
resulting in a share premium of £114,000 (2010 — £107,000). Annual Report 2011
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20660-04 03/10/2011 Proof 6
27.  CONTINGENT LIABILITIES
Cross guarantees were in place at 30 June 2011 in respect of bank borrowing facilities between all of the Group companies.
28.  OPERATING LEASE ARRANGEMENTS
The Group as lessee
2011
£’000
2010
£’000
Lease payments under operating leases recognised as an expense in the year 185 250
At the balance sheet date, the Group had outstanding commitments for future minimum lease payments under non-
cancellable operating leases, which fall due as follows:
2011
£’000
2010
£’000
Within one year 108  215 
In the second to fifth years inclusive  39  123 
After five years  5  77 
  152  415 
Operating lease payments represent rentals payable by the Group for certain of its office properties, vehicles and office 
equipment.
29. CAPITAL COMMITMENTS
At 30 June the Group had capital commitments as follows:
2011
£’000
2010
£’000
Contracted for but not provided in the financial statements — 35
30.  SHARE-BASED PAYMENTS
Details of the movement in share options during the year are as follows:
EMI SAYE Unapproved
Options
Price
£ Options
Price
£ Options
Price
£
Outstanding at beginning of year  460,000 0.700 168,134 0.440 300,000 0.710
Expired during year  (80,000) 0.950 (27,199) 0.440 — 
Exercised during the year (235,500) 0.591 (90,695) 0.440 —  
Open at 30 June 2011 144,500 0.727 50,240 0.440 300,000 0.710
Exercisable at the end of the year  89,500   3,247   100,000  
Notes to the Accounts
Year ended 30 June 2011 www.animalcaregroup.co.uk
Stock code: ANCR
51
20660-04 03/10/2011 Proof 6
Accounts
30.  SHARE-BASED PAYMENTS (continued)
The weighted average inputs into the Black–Scholes model at the time of grant were as follows:
EMI
Scheme
SAYE
Scheme
Unapproved
Scheme
Weighted average share price 63p 58p 65p
Weighted average exercise price 66p 49p 67p
Expected volatility 35% 36% 35%
Expected life 2.4 years 3.0 years 2.7 years
Risk-free rate 4.2% 4.8% 4.0%
Expected dividend yield 3.6% 3.2% 3.6%
Expected volatility was determined by calculating the historical volatility of the Group’s share price over the previous two 
years. The expected lives used in the model were estimated based on management’s best estimate for the effects of non-
transferability, exercise restrictions, and behavioural considerations.
The aggregate estimated fair value of the options granted during the year was £nil (2010 — £39,000).
The Group recognised total expenses of £16,000 (2010 — £58,000) within administrative expenses.
31.  RELATED PARTY TRANSACTIONS
Trading transactions
During the year ended 30 June, the following trading transactions took place between the Company and its subsidiaries 
listed in note 18:
2011
Animalcare 
Limited
£’000
Fearing 
International 
(Stock Aids) 
Limited
£’000
Naychem 
Limited 
(formerly T ravik 
Chemicals 
Limited)
£’000
Total
£’000
Sale of Goods —  62  —  62 
Purchase of Goods —  13  98  111 
Management Charges levied 187  7  21  215 
Dividends received 3,892  180  —  4,072 
2010
Animalcare 
Limited
£’000
Fearing 
International 
(Stock Aids) 
Limited
£’000
Naychem 
Limited 
(formerly Travik 
Chemicals 
Limited)
£’000
Total
£’000
Sale of Goods 2  86  —  88 
Purchase of Goods —  39  281  320 
Management Charges levied 156  67  83  306 
Dividends received 1,500  150  —  1,650 
Remuneration of key management personnel
The remuneration of the directors, who are the key management personnel of the Group, is set out in aggregate for each 
of the categories specified in IAS 24 Related Party Disclosures. Further information about the remuneration of directors is 
provided in note 9. The directors’ interests in the shares of the Company are contained in note 9. Annual Report 2011
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20660-04 03/10/2011 Proof 6
Officers and Professional Advisors
Directors J S Lambert
 S M Wildridge
 P O R Warner
 I D Menneer
 Lord Downshire
Secretary P O R Warner
Company Number 1058015
Registered Office Common Road
 Dunnington
 York
 YO19 5RU
Auditors KPMG Audit Plc
 1 The Embankment
 Neville Street
 Leeds
 LS1 4DW
Bankers Barclays Bank PLC
 PO Box 190
 1 Park Row
 Leeds
 LS1 5WU
Solicitors Langleys
 Queens House
 Micklegate
 York
 YO1 6WG
Nominated Advisor and Broker Brewin Dolphin Limited
 34 Lisbon Street
 Leeds
 LS1 4LX
Registrars Capita Registrars Limited
 34 Beckenham Road
 Beckenham
 Kent
 BR3 4TU 20660-04 03/10/2011 Proof 6 20660-04 03/10/2011 Proof 6
Common Road 
Dunnington
York  
YO19 5RU
UK
T: +44 (0) 1904 487687
F: +44 (0) 1904 487611
E: info@animalcaregroup.co.uk
www.animalcaregroup.co.uk