Resilience 
Performance 
Growth 
Empresaria Group plc
Annual report and accounts 2010
Empresaria Group plc
Old Church House
Sandy Lane
Crawley Down
Crawley
West Sussex
RH10 4HS
Tel: +44 (0) 1342 711 430
Fax: +44 (0) 1342 711 449
Email: info@empresaria.com
w w w .em p resaria.co m
Empresaria Group plc Annual report and accounts 2010 Empresaria is an international specialist 
staffing Group. Our companies, each 
specialising in specific markets or services, 
operate across the world with representation 
in 18 countries through over 100 offices.  
Our service capabilities include temporary 
and permanent recruitment, Recruitment 
Process Outsourcing, HR consulting and 
corporate training.
The strategy of the Group is to develop a diversified business 
across sectors and geographies, with a focus on high-growth 
markets. The Group operates through sector-specific brands, 
with each brand positioned and developed to be a specialist 
in its own field. 
The Group applies a philosophy of management equity to align  
the interests of shareholders and Group management teams 
through the sharing of risk and reward by way of equity 
participation. Group structure is decentralised with local 
management retaining operational autonomy and responsibility 
and with central functions focussing on financial planning and 
control, Group development and administration.
Contents 
Overview
01 Highlights
02 At a glance
04 Chairman’ s statement
 
Business review
06 Chief Executive’ s business review
08 Strategy to achieve objectives
10 Regional review
16 Key performance indicators
18 Finance review
22 Corporate social responsibility
 
Governance
24 Board of Directors
26 Directors’ report
28  Statement of Directors’ responsibilities
29 Corporate governance statement
31 Audit committee report
33 Directors’ remuneration report
35  Independent auditor’s report to the members 
of Empresaria Group plc
 
Financials
36 Consolidated Income Statement
37  Consolidated Statement of Comprehensive 
Income
38 Consolidated Balance Sheet
39  Consolidated Statement of Changes in Equity
40 Consolidated Cash Flow Statement
41  Notes to the Consolidated Financial 
Statements
64  Independent Auditors’ Report to the members 
of Empresaria Group plc
65 Parent Company Balance Sheet
66  Notes to the parent Company financial 
statements 
72 Officers and professional advisers
2 0 1 0* * 2009** 2008 2007 2006
Revenue (£m) 2 2 3 .4 190.5 207.7 147.8 75.5
Gross profit (£m) 4 9.0 40.6 51.5 42.4 21.8
Profit/(loss) before tax (£m) 6.7 (1.5) 1.3 6.0 2.9
Adjusted profit before tax (£m)* 6 .8 3.5 6.4 6.2 2.9
Operating profit/(loss) (£m) 7.5 (1.0) 2.4 6.7 3.5
Adjusted operating profit (£m)* 7.8 4.3 7.5 6.9 3.5
Earnings/(loss) per share (pence) 7.0 (11.6) (4.8) 8.4 6.7
Adjusted earnings per share (pence)* 6. 2 3.1 8.6 9.2 7.2
Proposed dividend per share (pence) 0. 35 0.35 0.35 0.55 0.5
*  Figures based on underlying profits excluding amortisation of intangible assets, 
movements on put and call options and any exceptional items. See reconciliation in note 11.
**  The figures for 2010 and 2009 exclude the results from discontinued operations  
(see note 6 for details).
The figures for 2009 have been restated. See note 28 for details.
Overview of performance
This report has been printed to environmental 
management system ISO 14001 standards by 
a printer which is Forest Stewardship Council 
(FSC) chain of custody-certified. All inks used are 
vegetable-based. This paper is environmentally 
friendly ECF (elemental chlorine-free) and wood-free 
with a great proportion of the raw material used being 
the by-product from other production processes i.e. 
saw mill waste and waste which results from forest 
thinning. The mill is fully FSC-certified. The paper 
is also completely bio-degradable and recyclable.
 
Designed and produced by The College 
www.thecollege.uk.com
TT-COC-002228 Overview
Empresaria Group plc 
Annual report and accounts 2010
01
Highlights
Cautionary statement
The Chairman’s statement and Chief Executive’s business review (the reviews) have been 
prepared solely to provide additional information to shareholders to assess the Company’s 
strategies and the potential for those strategies to succeed. The reviews should not be relied 
on by any party or for any other purpose.
The reviews contain certain forward looking statements. These statements are made by  
the Directors in good faith based on the information available to them up to the time of their 
approval of this report and such statements should be treated with caution due to the 
inherent uncertainties, including both economic and business risk factors, underlying  
any such forward looking information.
Operational focus on strengthening and 
investing in existing operations as well  
as adding new capabilities
NFI growth across all reporting regions
  31% in Rest of the world
  21% in Continental Europe
  15% in UK
Development of incubator concept in Asia 
with first hub established in Singapore with  
support from four Group brands
58% growth in permanent revenue
 
15% growth in temporary revenue
 
Conversion ratio improved to 16%
 
Strong cash generation with cash generated from 
operations of £8.3m
 
Net debt reduced by £1.9m to £6.1m despite 
investment of £2m in minority share purchases 
and investment in working capital for growth
Revenue (£m)
2010
2009
2008
2007
2006
0 50 100 150 200 250 300 0
Net fee income (£m)
2010
2009
2008
2007
2006
10 20 30 40 60 70 50
Adjusted profit before tax (£m)
2010
2009
2008
200 7
2006
0 0 1 2 3 4 6 8 5 7
Adjusted earnings per share (p)
2010
2009
2008
2007
2006
0 1 2 3 4 6 11 5 7 8 9 10 Empresaria Group plc 
Annual report and accounts 2010
02
Overview
At a glance
An international business. 
Empresaria operates in international 
markets that are characterised by a  
balanced combination of established 
scale and growth potential.
Quick facts 
3 
Regions of operation
18 
Countries
38 
Trading companies
832 
Employees (average number)
Group revenue
Net fee income
Employees
763 
2009
901 
2008
33 
2009
52 
2008
17 
2009
20 
2008
3 
2009
3 
2008
 UK 36%
 Continental Europe 45%
 Rest of the world 19%
 UK 35%
 Continental Europe 45%
 Rest of the world 21%
 UK 25%
 Continental Europe 26%
 Rest of the world 49% Overview
Empresaria Group plc 
Annual report and accounts 2010
03
UK
United Kingdom
UK
Financial services
Creative & media
Outsourcing
Domestic service
Retail
Property services  
& construction
Supply chain & logistics
Key sector specialisms
Continental Europe 
Germany
Austria
Hungary
Finland
Estonia
Czech Republic
Slovakia
Continental Europe  
Engineering
Supply chain & logistics
IT
Healthcare
Training services
Rest of the world 
Japan
Indonesia
Chile
China
India
Thailand
Philippines
Malaysia
Singapore
Australia
Rest of the world 
IT
Retail
Outsourcing
Creative & media
Training services
Executive search
Regions of operation Empresaria Group plc 
Annual report and accounts 2010
04
Overview
Chairman’s statement
The Group performed 
strongly in the year, with 
impressive net fee income 
and profit growth across 
all regions.
Tony Martin 
Chairman
Overview 2010
The Group performed strongly in the year, in line with 
expectations that were revised upwards on a number of 
occasions. The focus during 2010 has been on strengthening 
our operations throughout the world through investment in new 
capabilities and resources within our existing businesses. This 
approach has paid dividends in the form of impressive net fee 
income and profit growth, with revenues and profit before tax  
in the year exceeding previous highs. 
Group strategy
Group strategy is to continue to develop an international, 
multi-sector specialist staffing Group balanced both in terms  
of sector and geographical coverage, with an investment focus 
on developing staffing markets and emerging economies. This 
combination of diversification and international market focus  
is designed to mitigate market volatility at the same time as 
creating greater growth opportunities. Underpinning this 
strategy is the philosophy of management equity, with 
operating company management teams investing directly  
in their own businesses, thereby aligning management and 
shareholder interests.
Since moving to AIM in late 2004 Empresaria has taken a 
number of steps in the implementation of this strategy. It has 
moved from being 100% UK focussed to now having only one 
third of its net fee income generated in the UK, with meaningful 
exposure to some of the fastest growing staffing markets in the 
world. The Group has still though some way to go to achieve its 
strategic objectives. Focus will be on continuing to strengthen 
and expand our existing brands and capabilities, on re-shaping 
the Group to increase the contribution from professional 
staffing operations, and on expanding into new geographies 
with growth potential.
Financial performance
Revenue for the year grew 17% to £223.4m (2009: £190.5m) and 
net fee income increased 21% to £49.0m (2009: £40.6m). Profit 
before tax (adjusted for intangible amortisation and exceptional 
items) increased 94% to £6.8m (2009: £3.5m). There were no 
exceptional items in the current year.
Revenue, net fee income and profits grew across all reporting 
regions. The significant increase in profit contribution from 
companies operating in Asia reflects the maturing nature of 
these companies, almost all green-field start ups of recent 
years, and of their future growth potential. Overview
Empresaria Group plc 
Annual report and accounts 2010
05
The Group was strongly cash generative in the year such that, 
despite investments in working capital to support growth and 
the acquisition of minority shareholdings, reported net debt 
reduced by £1.9m to £6.1m at the year end (2009: £8.0m).
Dividend
For the year ended 31 December 2010, the board is proposing  
a dividend of 0.35p per share (2009: 0.35p per share) which,  
if approved by shareholders at the Company’s Annual General 
Meeting, will be paid on 15 August 2011 to shareholders on  
the register on 15 July 2011.
Empresaria people
The number of people working within the Group, across the 
world, grew in 2010 from 763 to 883 at the year end. 
Empresaria’s success is largely dependent on their efforts and 
contribution. We recognise the importance of our people and 
seek to demonstrate this at Group level in a number of ways. 
These include the promotion of the newly launched International 
Recruitment MBA programme within the Group and the 
development of consultant exchange programmes between 
companies and countries. The board would like to thank them 
for all of their hard work and achievement in the year.
Current trading and outlook
Group operations around the world continue to benefit from 
broadly positive market environments. Our South East Asia 
markets have been particularly strong in recent months. The 
two geographies where we are experiencing some challenges 
and market uncertainty are Japan and Germany. In the case of 
Japan, our two trading companies have both been adversely 
affected by the earthquake and tsunami and we do expect some 
months of further disruption. In the case of Germany, recent 
legal challenges to certain collective labour agreements have 
created some short-term market turbulence and gross margin 
erosion as well as exposed a significant number of staffing 
companies operating in Germany to possible future claims from 
third parties. 
Forward visibility, as ever, remains somewhat limited but the 
Group is well positioned to benefit from its exposure to growing 
markets as well as from its continued investment in people and 
capabilities.
Tony Martin
Chairman
30 March 2011
The number of people working within the 
Group, across the world, grew in 2010 to 883 
at the year end.
Image above supplied by FastTrack 
Management Services.
Employees
(at year end)
2010 2009
UK 215 185
Europe 220 210
Rest of the world 448 354 Empresaria Group plc 
Annual report and accounts 2010
06
Business review
Chief Executive’s business review
Our primary business 
objectives are to create 
sustainable growth  
in adjusted EPS and to  
be a leading international 
diversified and specialist 
staffing Group.
Miles Hunt 
Chief Executive
Group results
The Group has delivered a strong performance in the year 
under review, reporting a 17% increase in revenue to £223.4m, 
and a 21% increase in net fee income (gross profit) to £49.0m. 
These results reflect a combination of improved market 
conditions generally, plus growth in demand for our services  
in our key staffing markets.
Each of our reporting regions delivered improved performances, 
most notably the Rest of the World region, where our maturing 
Asian businesses helped to contribute to a 31% increase in  
net fee income over 2009. The Asian economies were not as 
severely affected by the worldwide economic decline in 2009 
and our investments over the past five years are now generating 
material profits. The region continues to be a focus for Group 
expansion. In January 2011 we opened a new hub office in 
Singapore which has allowed Group companies to enter this 
market at a lower cost and risk. At launch there were four 
brands operating for the first time in Singapore.
Our Continental Europe region also performed well, helped 
predominantly by the strength of the recovery of the German 
economy and by growing demand for healthcare workers in 
Scandinavia. Net fee income in this region grew by 21% to 
£21.9m (2009: £18.1m). 
Growth was more modest in the UK, reflecting the maturity  
of the staffing market and the relatively poor economic 
environment. Despite this, net fee income still grew by  
15% to £17.0m (2009: £14.8m).
Overall gross margin for 2010 was 22% (2009: 21%). This 
increase was mainly driven by growth in our permanent 
revenue, which increased by 58% over 2009 and contributed 
26% of Group net fee income (2009: 20%). The Group’s 
temporary revenue increased by 15%, with margins maintained 
at 18% despite some margin erosion in Germany.  Business review
Empresaria Group plc 
Annual report and accounts 2010
07
Administrative costs increased by 13% to £41.2m (2009: 
£36.3m), a lower rate than the increase in net fee income, 
mainly as a result of higher staff costs, due to performance 
related commissions and bonuses and the start of investments 
in headcount to drive future growth in the business.
Cash generated from operations in the year was £8.3m (2009: 
£3.4m). After accounting for tax and interest, the Group 
generated free cash flow of £5.1m, with £2.9m used to acquire 
management equity and fixed assets and £1.1m to pay 
dividends to shareholders and to holders of minority interests  
in the subsidiaries. Group net debt reduced to £6.1m at the end 
of 2010 (2009: £8.0m).
Business overview
The principal activity of the business is the provision of 
recruitment services on a permanent and temporary contract 
basis in the regions of the UK, Continental Europe and 
Rest of the world (comprising Asia Pacific and South America). 
Activities also include Recruitment Process Outsourcing,  
HR consulting and training services.
Management equity
The key managers within the operating companies hold shares 
in their company, so aligning the interests of shareholders and 
the management team through the sharing of risks and rewards 
of equity participation. This acts as an important incentive to 
grow their business and fosters an entrepreneurial spirit.
The shareholdings held by management vary by company but 
will range from 49% to less than 5%, depending on the stage of 
development of the company. The opportunity to invest directly 
in a Group company is also used to attract experienced and 
ambitious individuals to the Group.
Autonomous, decentralised structure
The Group operates in a highly decentralised structure, with 
autonomous operating companies managed by entrepreneurial 
teams, with a small central team focussing on financial 
planning and control, Group development and administration.
The operating companies have commercial autonomy and 
responsibility, and are run by local teams who have local 
knowledge and experience and are able to react to changes in 
the local markets. They operate under strict financial controls, 
overseen centrally.
The management teams are encouraged to develop their 
businesses and drive organic growth. Whilst the Group 
operates through separate brands and management teams, key 
staff from individual Group companies meet regularly to explore 
how they can work better together and exploit the skills and 
capabilities of other Group companies for their own business. Empresaria Group plc 
Annual report and accounts 2010
08
Business review
Strategy to achieve objectives
Our objective is to create sustainable growth in 
adjusted EPS. Our focus is on accelerating growth 
and reducing risk by building a balanced and 
diverse portfolio of operations across specialist 
market sectors and geographies.
Strategic focus
Balanced growth and managed risk – 
accelerate growth but reduce risk
Empresaria has a strong growth record, despite a setback  
in 2009 due to the worldwide economic downturn. The focus  
in recent years has been on strengthening our existing 
businesses and improving cash generation to continue  
to drive organic growth.
Diversification by geography and sector
Despite the cyclical nature of our industry, we have  
succeeded in reducing volatility through sector and regional 
diversification. We have made good progress in diversifying 
from an historic UK-based business, with 65% of net fee  
income currently from outside the UK. We are also focussing  
on diversifying our sector focus and are targeting growth in 
white collar and professional staffing sectors.
Specialist staffing rather than generalist
The Group is focussed on developing strong specialist staffing 
brands. Specialist staffing operations benefit generally from 
higher margins and higher growth opportunities. Our clients 
benefit also from sector experience and knowledge that helps 
provide a better quality and value added service.
Operational mix – temporary focus to 
minimise volatility
Whilst we have a strong permanent recruitment presence,  
our key focus is on temporary recruitment as this is more  
stable throughout the economic cycle and has been the driver  
of long-term growth in our industry. We continue to provide a 
range of services, and our model allows us to react quickly to 
changes in the industry.
High-growth markets – developing 
staffing markets or emerging economies
We have developed our international presence to benefit from 
the higher growth opportunities from emerging economies  
and developing staffing markets stimulated by structural 
change. We will continue to look for opportunities in higher 
growth markets where the Group is not currently represented.
Multi-branded rather than single brand
In order to take best advantage of the opportunities in our 
market, we apply a multi-brand strategy. This enables us  
to act quickly and to retain a specialist focus through the 
individual expertise and reputation of each of our brands  
in their specialist area. Business review
Empresaria Group plc 
Annual report and accounts 2010
09
UK Continental Europe Rest of the world 
In the UK, our creative staffing business 
recently opened a second office in 
Melbourne, Australia, to complement 
their existing team in Sydney.
In Germany we invested in two new 
divisions in 2010, Healthcare and 
Training, to deliver growth over the next 
few years. We also acquired a small 
recruitment firm in Hungary to help 
provide staffing services to the growing 
German market.
Empresaria launched a hub office in 
Singapore in January 2011, which 
already has four Group companies as 
joiners, all gaining access to a new 
market at reduced cost and risk.
Split of net fee income between permanent and temporary
 Temporary 64%
 Permanent 36%
 Temporary 99%
 Permanent 1%
 Temporary 35%
 Permanent 65%
2010 2009
Revenue (£m) 43.0 34.7
Net fee income (£m) 10.1 7.7
Employees (Ave no.) 409 351
2010 2009
Revenue (£m) 99.4 80.1
Net fee income (£m) 21.9 18.1
Employees (Ave no.) 212 205
2010 2009
Revenue (£m) 81.0 75.7
Net fee income (£m) 17.0 14.8
Employees (Ave no.) 210 207 Empresaria Group plc 
Annual report and accounts 2010
10
Business review
Regional review
United Kingdom 
A good performance  
in the year with net  
fee income growth of  
15%, despite continued  
economic uncertainty .
£m 2010 2009
Revenue 81.0 75.7
Net fee income 17.0 14.8
Adjusted operating profit 2.2 2.0
% of Group net fee income 35% 35%
Operating performance
Quick facts Group revenue
% of Group revenue
Net fee income
 UK 36%
 Continental Europe 45%
 Rest of the world 19%
 Temporary 64%
 Permanent 36%
12 
Trading companies
210 
Employees (average number)
207 
2009
281 
2008
13 
2009
18 
2008 Business review
Empresaria Group plc 
Annual report and accounts 2010
11
Revenue increased 7% to £81.0m (2009: £75.7m) and net fee 
income grew by 15% to £17.0m (2009: £14.8m), driven largely by 
a 41% increase in permanent revenues to £6.2m (2009: £4.4m). 
As a result, the gross profit percentage for UK operations 
increased from 19.5% to 21%. Temporary staffing accounted 
for 64% of net fee income (2009: 70%), reflecting the improved 
permanent market and a steady temporary market. Adjusted 
operating profit increased by 10% to £2.2m (2009: £2.0m).
The improved market conditions experienced towards the  
end of 2009 continued in 2010. Growth rates slowed slightly  
in the second half of the year, largely reflecting the effect  
of the inclement weather on our Construction and Supply  
Chain operations.
Our financial services business experienced a strong rebound 
in demand, particularly for permanent positions. Banking and 
insurance markets performed particularly well and the life and 
pensions markets recovered after a difficult 2009.
Our Supply Chain operations showed an improved  
performance on 2009, with both permanent and temporary 
revenue contributing to a strong increase in net fee income. The 
medium-term outlook for this sector, which is heavily dependent 
on the retail market, is uncertain and we are reviewing how 
best to address the challenges that this uncertainty represents.
Our Property Services and Engineering businesses 
experienced a small reduction in temporary net fee income 
reflecting lower volumes in publicly sponsored infrastructure 
work, partially offset by steadily improving permanent revenue.
All businesses in our Other Brands category contributed to net 
fee income growth in the year, with noteworthy contributions 
from McCall, reflective of the general recovery in the 
recruitment-to-recruitment market and our creative brand, 
Become, which experienced a strong performance in both its 
UK and Australian markets. 
A number of investments were made by UK businesses  
outside the UK. At the end of the year our financial services 
brands, LMA and Mansion House, as well as our recruitment-
to-recruitment brand, McCall, all commenced operations in  
our Singapore hub.
 
Our financial services business experienced 
a strong rebound in demand, particularly for 
permanent positions. 
Image above supplied by LMA 
Recruitment. Empresaria Group plc 
Annual report and accounts 2010
12
Business review
Regional review continued
Continental Europe 
The strength of the German 
market helped net fee 
income grow by 21 %.
£m 2010 2009
Revenue 99.4 80.1
Net fee income 21.9 18.1
Adjusted operating profit 3.9 2.0
% of Group net fee income 45% 46%
Quick facts Group revenue
% of Group revenue
Net fee income
 UK 36%
 Continental Europe 45%
 Rest of the world 19%
 Temporary 99%
 Permanent 1%
12 
Trading companies
212 
Employees (average number)
205 
2009
278 
2008
7 
2009
13 
2008
Operating performance Business review
Empresaria Group plc 
Annual report and accounts 2010
13
Our healthcare staffing operations based in 
Finland and Estonia, continued to perform very 
strongly in 2010, increasing sales, net fee 
income and profits. 
Image above supplied by MediradiX.
Revenue increased by 24% to £99.4m (2009: £80.1m) and net fee 
income by 21% to £21.9m (2009: £18.1m). Some pressure on 
temporary gross margins resulted in the gross margin declining 
from 22.3% to 22.0%. Despite this, adjusted operating profit 
increased 95% to £3.9m (2009: £2.0m).
Our German operations benefitted from improved market 
conditions, particularly in exporting industries, and continued 
demand for their services. The staffing industry as a whole 
proved once more to be a very effective solution to meet the 
increased demand for skills with most new jobs created being 
filled by temporary staff.
We experienced growth across all sectors in Germany, 
particularly within the Logistics and Engineering divisions. 
During the course of the year we also invested in new 
Healthcare and Training divisions.
In December 2010 the German federal labour court held that a 
collective labour agreement applied by a large number of 
staffing companies operating in Germany, including a number 
of Headway companies, was invalid. This ruling was published 
on 25 February 2011. As a result of this ruling Headway may be 
subject to claims from temporary workers as well as from the 
German government. It is not clear at this time whether the 
ruling will be applied retroactively or how any potential liability 
could be quantified. For this reason, no provision for any 
liability has been made. From January 2011 these Headway 
operating companies have changed to another collective labour 
agreement which has increased pay for temporary workers and 
is having a short-term impact on gross margins pending 
renegotiation of billing rates with clients.
Our Healthcare staffing operations based in Finland and 
Estonia, continued to perform very strongly in 2010, increasing 
sales, net fee income and profits despite further investment in 
internal staff, recruitment activities and training. The structural 
shortage of healthcare staff in Finland is expected to worsen 
owing to the aging population of existing healthcare specialists. 
GIT, our specialist IT, Telecoms and Banking agencies, 
experienced the recovery in the hard hit economies of the Czech 
Republic and Slovakia towards the end of the year and are well 
positioned to benefit from any further economic growth in 2011.  Empresaria Group plc 
Annual report and accounts 2010
14
Business review
Regional review continued
Rest of the world 
This region is seeing 
maturing businesses deliver 
material profits, with net fee 
income growth of 31 %.
£m 2010 2009
Revenue 43.0 34.7
Net fee income 10.1 7.7
Adjusted operating profit 1.6 0.3
% of Group net fee income 21% 19%
Quick facts Group revenue
% of Group revenue
Net fee income
 UK 36%
 Continental Europe 45%
 Rest of the world 19%
 Temporary 35%
 Permanent 65%
14 
Trading companies
409 
Employees (average number)
351 
2009
342 
2008
13 
2009
21 
2008
Operating performance Business review
Empresaria Group plc 
Annual report and accounts 2010
15
IMS, our Indian operation, experienced growth 
in both its domestic market as well as for its 
Recruitment Process Outsourcing operations 
abroad.
Image above supplied by IMS.
Revenue increased by 24% to £43.0m (2009: £34.7m) and 
net fee income increased by 31% to £10.1m (2009: £7.7m). Net 
fee income from this region represents 21% of the Group total 
(2009: 19%) and has grown at the fastest rate. For the first time 
this region contributed materially to Group profitability with 
adjusted operating profit in the year of £1.6m (2009: £0.3m).
In 2010 all of our Asian operations benefitted from improved 
market conditions and have shown robust revenue and  
profit growth.
Our Japanese temporary staffing companies recovered  
from the downturn that negatively affected the Japanese IT 
and retail markets in 2009. Although net fee income growth was 
modest, profitability strongly improved in 2010 compared to 
2009. Trading conditions returned to a more stable situation 
during the year. The recent earthquake and tsunami in Japan is 
having a disruptive effect on operations and the overall 
financial impact will be dependent on the speed of recovery in 
confidence. In the year to 31 December 2010 Japan accounted 
for 6% of the Group net fee income. Based on our experience  
in Chile in 2010, we anticipate several months’ disruption in 
demand before normal business activity resumes. It is still  
too early to gauge the effect on the wider Japanese economy.
Within the South East Asian region, strong revenue and profit 
growth continued in 2010, particularly in Indonesia where we 
benefitted from high demand for our executive recruitment and 
corporate training services.
In the second half of the year we initiated a new incubator 
concept to support the growth of the Group within the Asian 
region. The Group’s recruitment hub is a shared full service 
facility that gives all Group companies the opportunity to 
establish a presence in new pockets of growth at minimum 
cost. The first hub was launched in January 2011 in Singapore, 
resulting in four Group brands (three from outside the Asia 
region) entering the Singapore market. 
We continued to invest in the service capabilities and 
geographic reach of IMS, our Indian operation. The business 
experienced growth in both its domestic market as well as for 
its Recruitment Process Outsourcing operations abroad. IMS 
now services clients in the UK, Australia, the US and in East 
Africa and offers a range of recruitment and HR-related 
solutions. 
Our operations in China also grew revenue, net fee income and 
profitability as well as headcount, capabilities and coverage.  
In the second half of 2010 we invested in a new office in Tianjin.
In South America, our retail and telecommunications focussed 
operations were affected by the earthquake in Chile early in 
2010. Our office in Concepcion was destroyed and a number  
of employees and contractors suffered loss of property and 
possessions. Clients, staff, suppliers and colleagues around  
the Group all contributed to the recovery effort. Both the 
Chilean economy and our operations in the country are fully 
recovered and performing in line with expectations. Empresaria Group plc 
Annual report and accounts 2010
16
Business review
Key performance indicators
Net fee income
Comprises gross revenue minus temporary payroll costs.
Growth in 2010 was £8.4m (21%) as the business recovered 
from the difficult trading conditions of 2009.
Adjusted profit before tax
The adjusted profit before tax measures the operating return 
from the business, after the costs of financing. The adjusted 
measure excludes exceptional items, movements in the value  
of put and call options and amortisation of goodwill. 
Growth in 2010 was £3.3m (94%).
See note 11 for details.
Adjusted EPS
This measures the return to shareholders after the impact of the 
share of minority interests. The Group’s objective is to grow the 
earnings for shareholders. 
Adjusted EPS in 2010 was 6.2p, up 100% on 2009.
See note 12 for details.
Temporary margin
The Group has a focus on the temporary recruitment market, 
being 74% of total net fee income. The temporary margin 
reflects the return to the Company.
The temporary margin in 2010 was 17.6%, in line  
with 2009.
0
Net fee income (£m)
2010
2009
2008
2007
2006
10 20 30 40 60 70 50
Adjusted profit before tax (£m)
2010
2009
2008
200 7
2006
0 0 1 2 3 4 6 8 5 7
Adjusted EPS (p)
0 1 2 3 4 5 6 7 8 9 10
2010
2009
2008
2007
2006
Temporary margin (%)
2010
2009
2008
2007
2006
0 30 20 15 10 25 5 Business review
Empresaria Group plc 
Annual report and accounts 2010
17
Conversion ratio
The conversion ratio shows the efficiency of managing the cost 
base and investment spend as it measures adjusted operating 
profit as a percentage of net fee income. The growth of 
shareholder return is from both growth in the top line revenue 
and management of the cost base.
In 2010 the conversion ratio was 15.9%, up from 10.6% in 2009.
Average debtor days
This shows how efficient the Group is at collecting its sales 
from customers and this has a direct impact on the funding of 
working capital for a growing business.
Group average debtor days at the end of 2010 were 52, down 
from 53 in 2009.
Net debt
The Group is in an overall net debt position and this  
must be managed to reduce interest costs and allow  
the business the funds for development activity.
Group net debt was £6.1m at the end of 2010, down  
from £8.0m at the end of 2009.
Conversion ratio (%)
0 4 8 12 16 20
2010
2009
2008
2007
2006
Average debtor days for year
2010
2009
2008
200 7
2006
0 70 40 30 20 50 60 10
Net debt (£m)
2010
2009
2008
2007
2006
0 (12) (8) (10) (2) (4) (6) Empresaria Group plc 
Annual report and accounts 2010
18
Business review
Finance review
Adjusted operating profit 
was £7 .8m, an increase  
of 81% over the prior year. 
Spencer Wreford 
Group Finance Director 
Revenue and gross profit
Revenue for the year was £223.4m (2009: £190.5m), a 17% 
increase. Gross profit increased 21% to £49.0m (2009: £40.6m). 
Gross margin was 21.9% (2009: 21.3%). This is due to a change 
in the mix of permanent and temporary sales. Permanent sales 
grew by 58% and accounted for 26% of the gross profit (2009: 
20%). Temporary revenue increased by 15%. The margin on 
temporary revenues was 17.6% (2009: 17.8%).
The proportion of net fee income from non-UK operations 
remained at 65% (2009: 65%). On a constant currency basis  
the net fee income increased by 20% over 2009.
Group trading summary
2010
£m
2009
£m
Restated
%
change
Revenue 223.4 190.5 17%
Gross profit 49.0 40.6 21%
Administrative costs (41.2) (36.3) 13%
Adjusted operating profit 7.8 4.3 81%
Net interest payable and 
receivable (1.0) (0.8) 25%
Adjusted profit before tax 6.8 3.5 94%
The adjusted operating profit and adjusted profit before tax 
figures exclude exceptional items, intangible amortisation and 
movements in the values of put and call options.
Operating profit
Administrative costs increased by 13% to £41.2m, mainly due 
to higher salary and commission costs, following the improved 
trading performance. Adjusted operating profit was £7.8m, an 
increase of 81% over the prior year. The conversion ratio 
improved to 15.9% (2009: 10.6%).
Operating profit, after intangible amortisation and exceptional 
items was £7.5m (2009: loss of £1.0m). In 2010 there were no 
exceptional items (2009: £5.0m). Business review
Empresaria Group plc 
Annual report and accounts 2010
19
Finance income and costs
Finance income in the year was £0.4m (2009: £0.7m). Bank 
interest income was £0.1m (2009: £0.2m). Finance costs were 
£0.8m (2009: £1.2m). Interest payable on invoice discounting 
and bank loans and overdrafts was £1.1m (2009: £1.0m). There 
was a net gain of £0.2m from the movement in the fair value of 
put and call options over minority shares in Group companies 
(2009: £0.3m).
Taxation
The total tax charge for the year was £2.3m (2009: £0.8m) 
representing an effective tax rate of 34% (2009: loss before tax). 
This is unusually high due to a combination of prior year tax 
charges, unrelieved withholding taxes and the mix of profits  
in the different jurisdictions in which the Group operates.
Discontinued operations
On 14 April 2010, the Group disposed of EAR Holdings BV 
(EAR), which carried out operations in the Netherlands. A profit 
of £0.3m arose on the disposal of EAR, being the costs of 
disposal less the carrying amount of the subsidiary’s net 
liabilities and attributable goodwill. Consideration received  
was €1, with payments due to the buyer of €175,000. This has 
been accounted for as a discontinued operation.
Earnings per share
Earnings per share from continuing and discontinued 
operations was 7.0p (2009: loss of 11.6p).
The Group achieved an adjusted earnings per share of 6.2p 
(2009: 3.1p). This measure excludes exceptional items and 
intangible amortisation and provides a better understanding  
of underlying trading. There were no exceptional items in  
the year.
There were no movements in the number of shares in issue 
during the year.
Adjusted earnings per share (p)
2010
2009
2008
2007
2006
0 1 2 3 4 6 11 5 7 8 9 10
Dividend
During the year the Group paid a dividend of £0.2m in respect 
of the year ended 31 December 2009, being 0.35p per share.  
For the year ended 31 December 2010, the board is proposing  
a dividend of 0.35p per share which, if approved by 
shareholders at the Annual General Meeting, will be paid on  
15 August 2011 to shareholders on the register on 15 July 2011.
Treasury
The Group maintains a range of facilities appropriate to manage 
its working capital and medium-term financing requirements. 
At the year end the Group had banking facilities totalling 
£30.1m (2009: £29.4m).
Bank facilities at 31 December
2010
£m
2009
£m
Overdrafts, loans and other bank debt 16.5 15.8
Invoice financing facilities 13.5 13.5
Other debt 0.1 0.1
30.1 29.4
The Group renewed its bank facilities in March 2011. The 
overdraft facility has increased to £6.1m from £4.8m and is 
renewable annually, the revolving credit facility has reduced to 
£6.25m from £7.25m and is for a 5 year term and a new term 
loan of £3.0m has been provided for 5 years, in addition to the 
remaining balances of the current term loans which continue to 
amortise on the same basis as before. Empresaria Group plc 
Annual report and accounts 2010
20
Business review
Finance review continued
Cash flow
Net borrowings decreased by £1.9m in the year to £6.1m at the 
year end (2009: £8.0m). There was a cash inflow from working 
capital movements of £2.2m and a cash outflow on investments 
of £2.1m, being £1.9m for the acquisition of minority shares in 
Group companies and £0.2m of deferred consideration for 
Saleslink in the UK. Tax payments were £2.1m and there were 
cash outflows of £1.0m on net interest costs and £0.8m on 
capital expenditure. Dividends payable to minority shareholders 
represented £0.9m with a further £0.2m of dividend paid to 
Group shareholders.
Bank facilities
Group net debt decreased from £8.0m at 31 December 2009 to 
£6.1m at 31 December 2010, as detailed below:
2010
£m
2009
£m
Cash at bank and in hand 7.1 4.9
Overdraft facilities (3.8) (2.1)
Invoice financing (with recourse) (0.8) (1.4)
Bank loans (8.6) (9.3)
Leases – (0.1)
(6.1) (8.0)
The Group’s bank covenant tests at 31 December 2010 were net 
debt: EBITDA of 0.7 times (covenant < 2.5 times), interest cover 
of 8.6 times (covenant > 3 times) and debt service cover of 3.1 
times (covenant > 1.25 times). The same covenants apply for the 
renewed facilities.
Cash flow bridge (£m)
0
1
2
3
4
5
6
7
8
9
10
11
Movement in
borrowings
Movement in
net debt
Adjusted
operating profit
Working capital
& depreciation
Tax & interest
Capital expenditure
Acquisition of
management equity
Dividends paid
outside of Group
Disposal of 
subsidiary
Acquisitions
In October 2010 the Group acquired 28% of the shares in 
FastTrack Management Services (London) Limited for £1.8m. 
The total consideration is up to a maximum of £2.0m, with 
contingent consideration of up to £163,000, payable in 2011 if 
certain performance criteria are met.
The Group has also made payments of contingent consideration 
for the Saleslink business, acquired in 2009, of £0.2m.
Balance sheet
The Group’s net assets as at 31 December 2010 were £29.2m (31 
December 2009: £26.9m). The increase was due to higher trade 
receivables of £2.5m, a decrease in the net debt of £1.9m, a 
higher deferred tax asset of £0.5m, an increase in the put and 
call net asset of £0.2m, less an increase in trade and other 
payables of £2.5m. Further details on the put and call net asset 
are in note 28.
Going concern
The board has undertaken a recent and thorough review of the 
Group’s budget, forecasts and associated risks and sensitivities. 
Despite the uncertainty in the economy and its inherent risk 
and impact on the business, the board has concluded, given  
the level of borrowings and bank facilities, that the Group is 
expected to be able to continue in operational existence for  
the foreseeable future, being a period of at least twelve months 
from the date of approval of the accounts. As a result, the going 
concern basis continues to be appropriate in preparing the 
financial statements. Further details on going concern are 
found in note 1. Business review
Empresaria Group plc 
Annual report and accounts 2010
21
Principal risks and uncertainties
The Group has a process that identifies certain risks that could affect business operations and hence the financial results  
of Empresaria. Further information on this process is set out in the Corporate governance statement on pages 29 to 30.
Risk Actions taken to mitigate risk
People
The Group’s future success relies on recruiting, developing and 
incentivising its senior management and other key employees. The loss 
of key personnel may have an adverse impact on the Group’s business 
and relationships.
The Group’s philosophy of management equity ensures that key 
management are appropriately incentivised through equity ownership. 
The Group operates through autonomous business units, so allowing 
key staff career development and progression.
Economic instability
The performance of staffing businesses has historically shown a 
strong correlation with performance of the economies in which they 
operate. An economic slowdown will impact on the demand for 
recruitment services and could reduce the Group’s profits.
The Group’s strategy of geographic and sector diversification is 
designed to minimise the effect of a downturn in any one market.  
The Group is constantly looking at how it can further diversify its 
business. The Group has a focus on the temporary recruitment market 
which is expected to minimise the negative impact of economic cycles. 
Nevertheless, a significant global economic downturn will impact all 
businesses.
Competitive risk 
Competition exists in all our markets, most notably in the most 
developed economies. This increases the pressure on margins and the 
ability to fill positions.
The Group’s strategy is to focus on growing in developing economies 
and staffing markets, where opportunities for growth are greatest.
Legal and regulatory changes
The Group’s business is subject to European, UK and overseas 
employment legislation and regulations. Any changes to these may 
impact on the manner in which Empresaria conducts its business and 
could therefore affect the financial performance of the Group.
The Group closely monitors the legal and regulatory situations in the 
markets in which it operates. The Group is a member of local industry 
associations which help identify arising issues and lobby on behalf of 
the industry.
Financial risks
The main financial risks facing the Group are availability of funds to 
meet business needs, credit risk arising from customer defaults, 
fluctuations in interest rates and foreign exchange risk.
Funding
The Group finances its operations by a combination of cash reserves 
from retained profit and bank borrowings. Treasury management is led 
by the Group finance team, which manages and monitors external and 
internal funding requirements. 
Credit risk
Credit risk is tightly managed to reduce any bad debts from non-
payment by our customers. This is led by the Group finance team. 
Average debtor days in 2010 were 52 days (2009: 53 days).
Interest rate risk
The Group is exposed to movements in interest rates for its primary 
facilities. The Group does not currently hedge this exposure.
Foreign exchange risk
A proportion of the Group’s business is transacted overseas and so is 
exposed to movements in exchange rates. The Group does not currently 
hedge translation risk as there is to some degree a natural hedge from 
operating in a wide range of countries.
Technology
Empresaria’s businesses are highly dependent on IT systems for the 
day-to-day running of their operations. A large amount of confidential 
data is stored on these systems.
There is an ongoing review to ensure that IT and telecommunication 
systems are maintained adequately and that repairs and upgrades are 
made as necessary. It is Group policy that each business has a process 
in place to protect against potential malicious attacks to its IT systems. 
In common with many organisations, although preventative procedures 
are in place, there remains a residual risk of disruption to voice and 
data infrastructure. Empresaria Group plc 
Annual report and accounts 2010
22
Business review
Corporate social responsibility
Ethics
The Company actively promotes integrity in its dealings with 
employees, shareholders, customers and suppliers and the 
authorities of the countries in which it operates. Empresaria 
recognises that its reputation is a valuable asset gained over  
a long period.
The Company promotes high ethical standards in carrying  
on its business activities and has clear guidelines for dealing 
with gifts, hospitality, corruption, fraud and the use of inside 
information. All staff must comply with the laws and 
regulations of the country in which they operate.
The Group aims to provide a high-quality service to clients  
and candidates alike and seeks to build strong and lasting 
relationships with both parties. The Group ensures that 
advertising and public communications avoid untruths or 
overstatements. Empresaria builds relationships with suppliers 
based on mutual trust and undertakes to pay suppliers on time 
and in accordance with agreed terms of business.
The Group builds relationships with candidates based on trust 
and quality of service. It recognises that information about 
candidates is sensitive and confidential and must be kept 
securely and not disclosed without a candidate’s permission.
Environment
Whilst it is recognised that the Group operates in a business 
sector that has a low environmental impact, the Group remains 
committed to minimising its impact on the environment. The 
Group is aware that this is an area of increasing importance to 
employees, shareholders and customers alike. The Group is not 
involved in the manufacture of any tangible products and has 
identified the principal areas of environmental impact as energy 
use, waste recycling, paper and printing, and travel.
The Group encourages the recycling of office waste and waste 
paper and is looking at how it can increase the recycling rates 
across the Group.
The Group is reducing the amount of printed materials it 
produces and places a greater reliance on electronic media for 
its marketing materials.
As an internationally diverse Group we recognise that some 
travel is inevitable and necessary for the effective management 
of the business, however, full use is made of telephonic 
conference facilities and working from home to minimise the 
need for business travel.
 
Empresaria believes that corporate and social responsibility is 
an important part of the Group’s culture and looks to adopt good 
practice in these areas. The board gives due consideration to 
risks arising from social, environmental and ethical issues as 
part of its ongoing risk review process.
Social interaction
The Group, as a diversified international business, recognises 
the importance of working in a culturally sensitive way with  
the local community and that its employment policies are 
non-discriminatory and encourage the employment of local 
nationals at all levels in the Group.
Employees are selected and promoted on the basis of merit  
and ability, regardless of age, gender, race, religion, sexual 
orientation or disability.
The Group recognises the need to provide a safe working 
environment for its staff and clients. Each office is responsible 
for ensuring that their business operates in compliance with 
Group policies and local health and safety legislation.
The Group has recently launched an employee exchange 
programme, open to all employees within the organisation.  
It is designed to allow staff to spend between a week and  
a month working in an office of another Group company in 
another country, to learn how their business operates and  
to swap ideas and best practice. The first swap is scheduled 
to take place in 2011.
The Group believes in continuous communication with all staff 
and in 2010 launched “Empresaria One”, a Group-wide intranet. 
This helps enable groups of employees from different businesses 
to come together to work on new initiatives and ideas, to see 
Group policies and procedures and be updated on Group news 
and activities.
The Group is supportive of staff working with their local 
communities and charitable concerns. Some examples of 
Group’s charitable support can be seen on the next page. 
The Group is committed 
to good practice in its 
social, environmental and 
ethical responsibilities. Business review
Empresaria Group plc 
Annual report and accounts 2010
23
Chile 
Following the devastating earthquake an 
appeal was made across the Group and in 
November 2010 a cheque for US $5,000 
was presented to Alternattiva.
UK 
Reflex HR sponsor 3 children through the 
Rakshak Trust, a children’s home near 
Narainpur in Central India. They have 
supported the trust since 2007 when they 
started to work with another Group 
company, IMS, based in India. 
Germany and Austria 
Headway Holding based in Germany 
made a donation to a statewide charity, 
Bayern 3 Sternstunden e.V, for children 
in need whilst Headway Austria donated 
presents to local children at Christmas.
Japan 
Funds are raised for the Franciscan 
Chapel Center’s (FCC) ‘Rice Program’  
in Tokyo by “TEAM Skillhouse” though 
charity bike rides.  Empresaria Group plc 
Annual report and accounts 2010
24
Governance
Board of Directors
1
2
3
4
5
The board has  
a balance of skills 
and experience Governance
Empresaria Group plc 
Annual report and accounts 2010
25
1 Tony Martin  
Chairman
Tony served as Chairman and CEO of 
Select Appointments (Holdings) Limited 
from 1992 to 1999 when he became Vice 
Chairman and member of the board of 
Management of Vedior NV, the world’s 
third largest staffing services group.  
In August 2000 he assumed the role of 
Chairman and CEO, which he served 
until his retirement in February 2004. 
Tony held the position of Executive 
Chairperson at Corporate Services Group 
until standing down in September 2007. 
2 Miles Hunt 
Chief Executive
Miles trained as a solicitor before 
completing an MBA at Warwick  
and establishing ProSource Limited,  
a procurement outsourcing company,  
in 1995. He set up Empresaria in 1996 
and has been Chief Executive since then. 
From 2000 to 2004 Miles was a non-
executive Director of Tribal Group plc. 
3 Spencer Wreford 
Group Finance Director
Spencer was appointed Group Finance 
Director in May 2010 and has over  
10 years’ experience in senior finance 
roles. He joined Empresaria from BPP 
Group, where he was the Finance 
Director of the BPP Professional 
Education division, a provider of 
international professional training. Prior 
to this he spent 8 years at ITE Group Plc, 
the international conference and 
exhibition organising group, as Deputy 
Finance Director, during which time he 
also spent six months as Acting Group 
Finance Director. Spencer is a member  
of the Institute of Chartered Accountants  
of England & Wales, qualifying with 
Arthur Andersen. 
4 Penny Freer 
Non-executive Director
Penny has worked in investment banking 
for over 25 years. She is a partner of 
London Bridge Capital, a corporate 
finance advisory firm. Until 2004 Penny 
was Head of Equity Capital Markets at 
Robert W Baird and from 2004 to 2005, 
Deputy Chairman of Robert W Baird 
Limited. Prior to this she was Head of 
Small/Mid Cap Equities for Credit 
Lyonnais. Penny is an independent 
director of three quoted companies:  
in addition to Empresaria she also  
sits on the boards of Advanced Medical 
Solutions plc and Sinclair Pharma plc. 
She joined the board of Empresaria in 
December 2005. Penny is the Chairperson 
of Empresaria’s Remuneration committee 
and also sits on the Audit committee.
5 Zach Miles 
Non-executive Director
Zach joined the board on 1 October 2008, 
having recently held the position  
of Chairman and Chief Executive Officer 
of Vedior N.V. He was a member of the 
board of Management from 1999, and 
Chairman since February 2004. Before 
joining Vedior, Zach was CFO and a 
member of the board of Directors of 
Select Appointments Plc. His career in 
the recruitment industry began in 1988. 
He was formerly a partner in the 
international accountancy firm Arthur 
Andersen and is a qualified Chartered 
Accountant. He sits on the Remuneration 
committee and is the Chairperson of the 
Audit committee.  Empresaria Group plc 
Annual report and accounts 2010
26
Governance
Directors’ report
There are no specific restrictions on the size of a holding  
nor on the transfer of shares, which are both governed by  
the general provisions of the Articles of Association and 
prevailing legislation. Shares which have been allotted to 
satisfy consideration payments on the acquisition of minority 
interests in the Group subsidiaries (pursuant to shareholders’ 
agreements) hold a two year restriction on sale. The number  
of issued shares subject to this restriction represents 0.08% of 
the current issued share capital, as at the date of this report. 
No person has any special rights of control over the Company’s 
share capital and all issued shares are fully paid.
Issue and acquisition of the Company’s own shares
At the end of the year, the Directors had authority, under the 
shareholders’ resolutions dated 3 June 2010, to: 
issue the following number of the Company’s ordinary shares:
 23,354,282, under resolution 7 (a);
 29,708,565, under resolution 7 (b); and
purchase through the market the following number of the 
Company’s ordinary shares:
 2,228,142, under resolution 9.
All authorities expire on the earlier of 31 August 2011 or the 
conclusion of the next Annual General Meeting. The Directors 
have not exercised these authorities.
Details of employee share schemes
There are no employee share schemes operated within the 
Group. Shareholder approval of a Long Term Incentive Plan  
for the issue of shares in Empresaria Group plc to Directors  
and senior executives was obtained in 2008. There have been 
no awards made under this plan. Details can be found in the 
Directors’ remuneration report on page 33.
Directors and their interests
The Directors who held office at 31 December 2010 had the 
following interests in the Company’s ordinary share capital:
31/12/2010
 Number of
ordinary
shares
31/12/2009
Number of
ordinary
shares
Executive Directors
Miles Hunt, Chief Executive 3,988,092 3,963,092
Spencer Wreford, Group Finance 
Director (from 4 May 2010) 15,000 –
Stuart Kilpatrick, Group Finance 
Director (until 4 May 2010) – 10,000
Non-executive Directors
Tony Martin, Chairman 9,203,046 9,203,046
Penny Freer, Chairperson  
of Remuneration committee 15,000 15,000
Zach Miles, Chairperson of  
Audit committee – –
The Directors present their annual report on the affairs of the 
Empresaria Group plc, together with the financial statements 
and auditors’ report, for the year ended 31 December 2010. The 
Corporate governance statement set out on pages 29 to 30 forms 
part of this report.
Principal activities
Empresaria Group plc is the holding company of the Group.  
The principal activities of the Group are to provide specialist 
staffing services. Our companies offer a full complement of 
recruitment and HR related services to a diversity of clients 
ranging from Fortune 500 companies to small businesses, from 
central government agencies to local community services. 
Empresaria companies, each specialising in specific markets  
or services, operate across the world with representation in 
18 countries and over 100 offices. Our sector focus includes 
Engineering, Logistics, Construction and Infrastructure, 
Banking and Financial Services, IT and Telecommunications, 
Healthcare and Professional Services. Our service capabilities 
include temporary and permanent recruitment, Recruitment 
Process Outsourcing, HR consulting and corporate training. 
The subsidiary and associated undertakings principally 
affecting the profits or net assets of the Group in the year are 
listed in note 6 to the financial statements of the Company.
Business review and future prospects
The Company is required by the Companies Act to include  
a business review in this report. The information that fulfils  
the requirements of the business review can be found in the 
Chairman’s statement, Chief Executive’s operating review  
and Finance review on pages 4 through to 21.
Financial instruments
Information about the policy, exposure and use of financial 
instruments by the Company and its subsidiaries is disclosed  
in note 22.
Results and dividends
The results for the year are set out on page 36. Details about the 
final dividend for the year are disclosed in the Finance review 
on page 19. 
Articles of Association
The Articles of Association may be amended by special 
resolution of the shareholders. The current Articles can be 
found on the Company website.
Capital structure
Details of the issued share capital, together with details of  
the movements in the Company’s issued share capital during 
the year are shown in note 21. The Company has one class  
of ordinary shares which carry no right to fixed income. 
Each share carries the right to one vote at general meetings  
of the Company. Empresaria Group plc 
Annual report and accounts 2010
27
Governance
Fixed assets
There is no material difference between the book value and 
the current open market value of the Group’s interests in land 
and buildings.
Employee consultation and disabled employees
The Group places considerable value on the involvement of its 
employees and has continued to keep them informed on matters 
affecting them as employees and on the various factors 
affecting the performance of the Group. This is achieved 
through formal and informal meetings, the Company’s website 
and Company intranet. 
Applications for employment by disabled persons are always 
fully considered, bearing in mind the aptitudes of the applicant 
concerned. In the event of members of staff becoming disabled 
every effort is made to ensure that their employment with the 
Group continues and that appropriate training is arranged. It  
is the policy of the Group that the training, career development 
and promotion of disabled persons should, as far as possible,  
be identical to that of other employees. 
Charitable and political contributions
During the year the Group made charitable donations of £7,500 
(2009: nil). The Group made no political donations during the 
year (2009: nil). 
Independent auditors and statement of provision of 
information to the independent auditors
Each of the persons who is a Director at the date of approval  
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/she ought to have 
taken as a Director in order to make himself/herself 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.
Deloitte LLP have expressed their willingness to continue  
in office as auditors of the Company and a resolution to 
reappoint them will be proposed at the forthcoming Annual 
General Meeting.
Approved by the board of Directors and signed on its behalf by:
Anne-Marie Clarke
Company Secretary
30 March 2011
Director changes
Spencer Wreford was appointed as Group Finance Director on  
4 May 2010, replacing Stuart Kilpatrick. Spencer Wreford was 
re-elected by shareholders at the Annual General Meeting held 
on 3 June 2010.
Directors’ interests
No changes took place in the interests of the Directors between 
31 December 2010 and the date of this report. None of the 
Directors had interests in other Group companies.
Appointment, retirement and replacements of Directors
The Company is governed by its Articles of Association, the 
Companies Act and related legislation, AIM rules and applies 
the UK Corporate Governance Code. This requires that all 
Directors retire at least every three years and that a third of the 
Directors retire by rotation. At the next Annual General Meeting 
Tony Martin retires by rotation and, being eligible, offers 
himself for re-election. 
Directors’ powers
The Directors’ powers are conferred on them by UK legislation 
and by the Articles of Association. Further details can be found 
in the Corporate governance statement on pages 29 to 30. 
Directors’ indemnities
The Company has made no qualifying third-party indemnity 
provisions for the benefit of its Directors during the year.
Substantial shareholdings
As at 30 March 2011, excluding the Directors, the following 
interests in 3% or more of the issued ordinary share capital in 
the register maintained under the provision of section 113 of the 
Companies Act 2006 were identified:
Name of holder
Number of
ordinary 
shares
Percentage
holding
Caledonia Investment plc 10,249,264 23.00%
Liontrust Asset Management 3,127,909 7.02%
Ennismore Fund Management 2,897,027 6.50%
Tim Sheffield (ex board Director) 2,049,307 4.60%
Supplier payment policy
The Company and Group do not follow any specified code  
or standard on payment practice. However, it is the Company 
and Group’s policy to negotiate terms with its suppliers and  
to ensure that they are aware of the terms of payment when 
business is agreed. It is the Company and the Group’s policy  
to abide by these terms. Trade creditors of the Group at  
31 December 2010 were equivalent to 32 (2009: 30) days’ 
purchases, based on the average daily amount invoiced by 
suppliers during the year. Empresaria Group plc 
Annual report and accounts 2010
28
Governance
Statement of Directors’ responsibilities
The Directors are responsible for the maintenance and integrity 
of the corporate and financial information included on the 
Company’s website. Legislation in the United Kingdom 
governing the preparation and dissemination of financial 
statements may differ from legislation in other jurisdictions.
Directors’ responsibility statement
We confirm that to the best of our knowledge:
1.  the financial statements, prepared in accordance with the 
relevant financial reporting framework, give a true and fair 
view of the assets, liabilities, financial position and profit or 
loss of the Company and the undertakings included in the 
consolidation taken as a whole; and
2.  the management report, which is incorporated into the 
Chairman’s statement and Chief Executive’s business review 
and Finance review, includes a fair review of the development 
and performance of the business and the position of the 
Company and the undertakings included in the consolidation 
taken as a whole, together with a description of the principal 
risks and uncertainties that they face.
By order of the board
Miles Hunt Spencer Wreford
Director Director
30 March 2011
The Directors are responsible for preparing the annual report 
and the financial statements in accordance with applicable law 
and regulations. 
Company law requires the Directors to prepare such financial 
statements for each financial year. Under that law the Directors 
are required to prepare Group financial statements in accordance 
with International Financial Reporting Standards (IFRSs)  
as adopted by the European Union and Article 4 of the IAS 
Regulation and have chosen to prepare the parent Company 
financial statements in accordance with United Kingdom 
Generally Accepted Accounting Practice (United Kingdom 
Accounting Standards and applicable law). Under company  
law the Directors must not approve the accounts unless they  
are satisfied that they give a true and fair view of the state of 
affairs of the Company and of the profit or loss of the Company 
for that period.
In preparing the parent Company financial statements,  
the Directors are required to:
  select suitable accounting policies and then apply them 
consistently;
  make judgements and accounting estimates that are 
reasonable and prudent;
  state whether applicable UK accounting standards have  
been followed, subject to any material departures disclosed 
and explained in the financial statements; and
  prepare the financial statements on the going concern basis 
unless it is inappropriate to presume that the Company will 
continue in business.
In preparing the Group’s financial statements, International 
Accounting Standard 1 requires that Directors:
  properly select and apply accounting policies;
  present information, including accounting policies, in a 
manner that provides relevant, reliable, comparable and 
understandable information;
  provide additional disclosures when compliance with the 
specific requirements in IFRSs are insufficient to enable  
users to understand the impact of particular transactions, 
other events and conditions on the entity’s financial position 
and financial performance; and
  make an assessment of the Company’s ability to continue  
as a going concern.
The Directors are responsible for keeping proper accounting 
records that are sufficient to show and explain the Company’s 
transactions and disclose with reasonable accuracy at any time 
the financial position of the Company and enable them to ensure 
that the financial statements comply with the Companies Act 
2006. They are also responsible for safeguarding the assets of 
the Company and hence for taking reasonable steps for the 
prevention and detection of fraud and other irregularities. Empresaria Group plc 
Annual report and accounts 2010
29
Governance
Corporate governance statement
The Directors are responsible for the maintenance and integrity 
of the corporate and financial information included on the 
Company’s website. Legislation in the United Kingdom 
governing the preparation and dissemination of financial 
statements may differ from legislation in other jurisdictions.
Directors’ responsibility statement
We confirm that to the best of our knowledge:
1.  the financial statements, prepared in accordance with the 
relevant financial reporting framework, give a true and fair 
view of the assets, liabilities, financial position and profit or 
loss of the Company and the undertakings included in the 
consolidation taken as a whole; and
2.  the management report, which is incorporated into the 
Chairman’s statement and Chief Executive’s business review 
and Finance review, includes a fair review of the development 
and performance of the business and the position of the 
Company and the undertakings included in the consolidation 
taken as a whole, together with a description of the principal 
risks and uncertainties that they face.
By order of the board
Miles Hunt Spencer Wreford
Director Director
30 March 2011
The principal roles of the board are the protection and 
advancement of shareholders’ interests, providing overall 
direction for the Group and establishing and maintaining a 
framework of delegated authorities and controls which ensure 
the efficient and effective management of the Group’s 
operations. A formal schedule of matters reserved for 
consideration by the board gives it responsibility for: 
  overall Group strategy and objectives;
  approval of the Group annual budget and progress 
towards achievement of these budgets;
  changes to the Group’s capital structure;
  changes to the Group’s activities;
  changes to the senior management structure;
  approval of Group financing arrangements and  
treasury policy;
  approval of major acquisitions, disposals and additional 
investments in existing operations; and
  approval of major unbudgeted capital expenditure projects.
The Directors have access to the advice and services of the 
Company Secretary and all Directors are able to take 
independent professional advice in the furtherance of their 
duties if necessary.
All Directors, in accordance with the Code, will submit 
themselves for re-election at least once every three years. Any 
Directors appointed to the board during the year will submit 
themselves for re-election at the next Annual General Meeting 
following their appointment. In accordance with the Company’s 
Articles of Association one-third of the board is required to 
retire by rotation each year.
Board committees
The board delegates clearly defined powers to its Audit 
committee and Remuneration committee. Following each 
committee meeting the Chairperson of the committee updates 
the board on the matters discussed. The terms of reference for 
each of the committees are available to view on the Company’s 
website. Details of the work carried out by the Audit and 
Remuneration committees can be found in the Audit committee 
report on pages 31 to 32 and the Directors’ remuneration report 
on pages 33 to 34.
The board has deemed it appropriate for all members of the 
board to participate in the recruitment of members of the board. 
All board Directors have the opportunity to independently 
assess the suitability of potential candidates for vacancies 
which arise. Final approval for board appointments is given 
by the board as a whole. The appointment of Spencer Wreford, 
as Group Finance Director, followed a process of engaging an 
external search agency to source potential candidates based on 
a written job specification. Interviews were conducted initially 
by the Chief Executive and subsequently by the board 
Chairman and Chairman of the Audit committee prior to the 
final proposal and approval being sought from the board.
Corporate governance
The board is committed to maintaining its high standards of 
corporate governance, managing the Group in an efficient, 
effective, entrepreneurial and ethical manner for the benefit of 
shareholders over the longer term. Whilst the Company is not 
subject to the UK Corporate Governance Code published in 
June 2008 (the “Code”) applicable to companies listed on the 
Official List, the Directors recognise the value and importance 
of sound corporate governance and support the principles of the 
Code. The board has considered the implications of the 2010 UK 
Corporate Governance Code on the Group’s governance and 
will comply with those provisions considered appropriate for 
the size of the Group.
An explanation of how the main principles have been applied is 
set out below and in the Directors’ remuneration report and 
Audit committee report.
Directors
The board constitution and procedures
The Company is controlled through the board of Directors 
which meets regularly during the year. The Non-executive 
Directors meet without the Executive Directors being present  
if required.
The board has a balance of skills and experience, and 
biographies of the Directors can be found on page 25. The  
board is made up of two Executive Directors, Miles Hunt and 
Spencer Wreford, and three Non-executive Directors of whom 
two (Penny Freer and Zach Miles) are deemed by the board to 
be independent of management and free from any business or 
other relationships which could materially interfere with the 
exercise of their independent judgement. The Chairman is  
not considered to be independent as he holds a significant 
shareholding in the Company. Recognising that the Chairman 
is not an independent director, the board will appoint one of the 
independent Non-executive Directors to the position of Senior 
independent director during 2011. This position will enable 
shareholders to address any concerns to the board through  
an independent channel of communication.
The Chairman is primarily responsible for the running  
of the board. At the beginning of each year board meetings  
are scheduled in line with the key financial reporting dates.  
A more detailed agenda together with the board papers is 
distributed at least seven days before each board meeting.  
All Directors receive sufficient relevant information on 
financial, business and corporate issues to enable informed 
decisions to be taken at the board meetings. The regional heads 
of operations in the UK, Europe and Asia are invited to attend 
board meetings on a rotational basis to provide an update  
on the implementation of strategy, business objectives and 
performance in the relevant region. Any specific actions arising 
during meetings are agreed by the board and a follow-up 
procedure ensures their completion. The Chief Executive’s 
responsibilities focus on implementing Group strategy and 
running the board of Management. The board of Management 
comprises the two Executive Directors and the regional heads  
of operations in the UK, Europe and Asia.
Governance Empresaria Group plc 
Annual report and accounts 2010
30
Governance
Corporate governance statement continued
During the course of its review of the system of internal control, 
the board has not identified nor been advised of any failings or 
weaknesses which it has determined to be significant. 
Therefore a confirmation in respect of necessary actions has 
not been considered appropriate.
The Group’s system of internal control is designed to safeguard 
the Group’s assets and to ensure the reliability of information 
used within the business and for publication. Such a system is 
designed to manage rather than eliminate the risk of failure to 
achieve business objectives and can provide only reasonable and 
not absolute assurance against material misstatement or loss.
Audit committee and auditors
A separate Audit committee report is set out on pages 31 to 32 
and provides details of the role and activities of the committee 
and its relationship with the external auditors.
Relations with shareholders
Dialogue with institutional shareholders
The Directors seek to build on a mutual understanding of 
objectives between the Company and its institutional 
shareholders by:
  making annual and interim presentations to institutional 
investors;
  meeting shareholders to discuss long-term issues and  
obtain their views; and
  communicating regularly during the year.
Relations with shareholders are managed principally by the 
Chief Executive Officer and Group Finance Director. The views 
of shareholders are communicated to the board as a whole 
through regular board meetings and communication between 
meetings. Although primary responsibility for effective 
communication with shareholders lies with the Chairman, the 
Executive Directors prepare presentations for analysts and 
institutional investors following the interim and preliminary 
announcements. 
During 2010 Penny Freer conducted meetings with major 
shareholders to develop an understanding of their views about 
the Company. These views were communicated to the board. 
Constructive use of the Annual General Meeting
The board seeks to use the Annual General Meeting to 
communicate to shareholders. Shareholders are encouraged to 
participate in the Annual General Meeting at which the 
Chairman will present an update on the Group’s performance. 
The board, together with the Chairpersons of the Audit and 
Remuneration committees will be available at the Annual 
General Meeting to answer questions from shareholders.
Board evaluation
The board is reviewing its current system of appraisal of the 
Chairman and Non-executive Directors which will incorporate 
the role of the Senior independent director in the appraisal of 
the Chairman. This work will be completed during 2011.
Attendance at meetings
During the year the number of meetings of the board and 
committees and individual attendance by the members were  
as follows:
Main 
board
Audit
committee
Remuneration
committee
Number of meetings held 7 2 1
Tony Martin (Chairman) 7 1 –
Miles Hunt  
(Chief Executive) 7 – –
Spencer Wreford  
(Group Finance Director 
from 4 May 2010) 5 – –
Stuart Kilpatrick  
(Group Finance Director 
until 4 May 2010) 2 – –
Penny Freer  
(Non-executive Director) 7 1 1
Zach Miles  
(Non-executive Director) 7 2 1
All Directors attended all meetings that they were eligible  
to attend.
Remuneration
The level and make-up of remuneration and procedure for fixing 
the individual remuneration packages of individual Directors is 
described in the Directors’ remuneration report on pages 33 to 34.
Accountability and audit
Internal control
The board is responsible for the effectiveness of the Group’s 
system of internal control. A review has been completed by the 
board for the year ended 31 December 2010 and up to the date of 
approval of the annual report.
The board’s monitoring covers all controls, including financial, 
operational and compliance controls and risk management. It is 
based primarily on reviewing reports from management to 
consider whether significant risks are identified, evaluated, 
managed and controlled and whether any significant 
weaknesses are promptly remedied and indicate a need for 
more extensive monitoring. The Audit committee assists the 
board in discharging its review responsibilities. Empresaria Group plc 
Annual report and accounts 2010
31
Governance
Audit committee report
Meetings
The Audit committee is required to meet formally twice per  
year and has an agenda linked to the Group’s financial 
calendar. The agenda is predominantly cyclical and is therefore 
approved by the Audit committee Chairperson on behalf of his 
fellow members. Each Audit committee member has the right  
to require reports on matters of interest in addition to the 
cyclical items.
The committee meets twice during the year: in December to 
approve various matters relating to the planning of the annual 
audit process, and in March to approve the auditors’ report on 
their audit of the annual report and financial statements.
The Audit committee invites the Group Finance Director and 
senior representatives of the external auditors to attend all of its 
meetings, although it reserves the right to request any of these 
individuals to withdraw from the meeting.
Overview of the actions taken by the Audit committee to 
discharge its duties
Since the beginning of 2010 the Audit committee has:
  reviewed the December 2009 and December 2010 report and 
financial statements. As part of this review the committee 
received a report from the external auditors on their audit  
of the annual report and financial statements;
  reviewed and considered the Group-wide process used to 
identify, evaluate and mitigate risks;
  reviewed the effectiveness of the Group’s internal controls and 
disclosures made in the annual report and financial 
statements on this matter;
  reviewed and agreed the scope of the audit work to be 
undertaken by the auditors;
  considered a report from the external auditors on their review 
of the effectiveness of controls across the Group and received 
a report on management action taken in response to work 
undertaken by the auditors 2009;
  agreed the fees to be paid to the external auditors for their 
audit of the December 2009 and December 2010 financial 
statements;
  reviewed its own effectiveness;
  reviewed the requirement for an internal audit function; and
  undertaken an assessment of the qualification, expertise and 
resources, and independence of the external auditors and the 
effectiveness of the audit process. This included consideration 
of a report on the audit firm’s own quality control procedures 
and the audit firm’s annual transparency report.
Role of the Audit committee
The Audit committee is appointed by the board from the 
Non-executive Directors of the Company. The Audit committee’s 
terms of reference include all matters indicated in the UK 
Corporate Governance Code and can be found on the 
Company’s website at www.empresaria.com.
The Audit committee is responsible for:
  monitoring the integrity of the financial statements of the 
Group and any formal announcements relating to the Group’s 
financial performance and reviewing significant financial 
reporting judgements contained therein;
  reviewing the Group’s internal financial controls and the 
Group’s internal control and risk management systems;
  making recommendations to the board, for a resolution to be 
put to the shareholders for their approval in general meeting, 
on the appointment of the external auditors and the approval 
of the remuneration and terms of engagement of the external 
auditors;
  reviewing and monitoring the external auditors’ independence 
and objectivity and the effectiveness of the audit process, 
taking into consideration relevant UK professional and 
regulatory requirements; and
  developing and implementing a policy on the engagement of 
the external auditors to supply non-audit services, taking into 
account relevant guidance regarding the provision of non-
audit services by the external audit firm.
The Audit committee is required to report its findings to the 
board, identifying any matters on which it considers that action 
or improvement is needed, and make recommendations on the 
steps to be taken.
Composition of the Audit committee
The members of the Audit committee are:
Name Date of appointment
Zach Miles (Chairperson) 01/10/2008
Penny Freer 02/11/2010
Membership of the committee is reviewed by the Chairperson of 
the committee and the board Chairman. On 2 November 2010 
Tony Martin, board Chairman, stepped down from the 
committee, to be replaced by Penny Freer. It is the board’s firm 
position that both Zach Miles and Penny Freer are independent.
The committee is required to comprise of a minimum of two 
independent Non-executive Directors, one of whom should be a 
financially qualified member. Currently the Audit committee 
Chairperson fulfils this requirement as Zach Miles is a 
chartered accountant.
Governance Empresaria Group plc 
Annual report and accounts 2010
32
Governance
Audit committee report continued
Internal audit function
The Audit committee is required to assist the board to fulfil its 
responsibilities relating to the adequacy of the resourcing and 
plans for the provision of an internal audit function. Due to the 
size of the Group the Audit committee has recommended to the 
board that there is no requirement for an internal audit function, 
however the regional financial controllers perform a review of 
the financial reporting provided by the subsidiary operations.
The Group’s whistleblowing policy contains arrangements for 
the Group Company Secretary to receive, in confidence, 
complaints on accounting, risk issues, internal controls, 
auditing issues and related matters.
Overview
As a result of its work during the year, the Audit committee has 
concluded that it has acted in accordance with its terms of 
reference and has ensured the independence and objectivity of 
the external auditors.
The Chairperson of the Audit committee will be available at the 
Annual General Meeting to answer any questions about the 
work of the committee.
On behalf of the Audit committee
Zach Miles
Chairperson of the Audit committee
30 March 2011
External auditors
The Audit committee is responsible for the development, 
implementation and monitoring of the Group’s policy on 
external audit. The terms of reference assigns responsibility for 
monitoring the independence, objectivity and compliance with 
ethical and regulatory requirements to the Audit committee and 
day-to-day responsibility to the Group Finance Director. It 
states that the external auditors are jointly responsible to the 
board and the Audit committee and that the Audit committee is 
the primary contact. The Audit committee has established a 
policy on the non-audit services which the external auditors will 
and will not be allowed to provide to the Group, subject to de 
minimis levels.
To fulfil its responsibility regarding the independence of the 
external auditors, the Audit committee reviewed:
  the external auditors’ plan for the current year, noting the role 
of the senior statutory audit partner, who signs the audit 
report and who, in accordance with professional rules, has not 
held office for more than five years. In accordance with these 
rules, the senior audit partner has been replaced for the audit 
of the December 2010 annual report and financial statements;
  the arrangements for day-to-day management of the audit 
relationship; and
  the overall extent of non-audit services provided by the 
external auditors, in addition to its case-by-case approval of 
the provision of non-audit services by the external auditors:
The committee has considered the likelihood of a withdrawal  
of the auditor from the market and noted that there are no 
contractual obligations to restrict the choice of external 
auditors.
To assess the effectiveness of the external auditors, the  
Audit committee reviewed:
  the effectiveness for ensuring the external auditors’ 
independence and objectivity;
  the external auditors’ fulfilment of the agreed audit plan  
and any variations from the plan;
  the robustness and perceptiveness of the auditors in their 
handling of the key accounting and audit judgements; and
  the contents of the external auditor’s reporting on internal 
control.
Following the above, the Audit committee has recommended to 
the board that Deloitte LLP is re-appointed. Empresaria Group plc 
Annual report and accounts 2010
33
Governance
Directors’ remuneration report
Remuneration policy for the Executive Directors
Executive remuneration packages are designed to attract, 
retain, motivate and reward Directors. The Group’s policy on 
Executive Directors is as follows:
Basic salary
The basic salary of each Director is reviewed annually 
by the Remuneration committee with changes taking effect 
on 1 January each year. 
Pensions and other benefits
In addition to the basic remuneration payable under the service 
agreements, each of the Executive Directors is entitled to a 
pension provision and a range of other benefits, including 
private medical insurance and car allowance.
Annual bonus payments
The committee establishes the objectives that must be met  
for each financial year if a cash bonus is to be paid. For the 
financial year 2010 the targets and % of bonus payable were  
as follows:
2010
Chief Executive
Bonus at 80% of target 0%
Bonus at 100% of target 50%
Bonus at 120% of target 100%
Group Finance Director
Bonus at 80% of target 0%
Bonus at 100% of target 25%
Bonus at 120% of target 50%
The maximum bonus that can be earned by the Chief Executive 
is 100% of basic salary and for the Group Finance Director is 
50% of basic salary.
Targets were as detailed below:
Target 2010
Cash generated from operations 50% of bonus
EPS 50% of bonus
80% of both targets must be met for any bonus to be payable. 
All of the bonus is payable in cash.
For the year ending 2010 the cash generated from operations 
target was met in full and the EPS target was partially met. 
The bonus structure will remain the same for the coming year.
This report has been prepared in accordance with Schedule 8  
to the Accounting Regulations under the Companies Act 2006 
(The Act). This report also meets the relevant requirements 
 of the AIM rules and describes how the board has applied the 
principles relating to Directors’ remuneration in the UK 
Corporate Governance Code. 
A resolution to approve the report will be proposed at the 
Annual General Meeting of the Company at which the financial 
statements will be approved. The Act requires the auditors to 
report to the Company’s members on certain parts of the 
Directors’ remuneration report and to state whether in their 
opinion those parts of the report have been properly prepared in 
accordance with the Accounting regulations. The report has 
therefore been divided into separate sections for audited and 
unaudited information.
Unaudited information
Remuneration committee
The Company has established a Remuneration committee which 
is constituted in accordance with the recommendations of the 
UK Corporate Governance Code. The terms of reference of the 
Remuneration committee are available at www.empresaria.com.
The members of the committee during 2010 were:
  Penny Freer (Chairperson);
  Zach Miles.
All members of the committee are independent Non-executive 
Directors.
None of the committee has any personal financial interest (other 
than as shareholders), conflicts of interests arising from 
cross-directorships or day-to-day involvement in running the 
business.
The committee determines the individual remuneration 
packages for each Executive Director and members of the board 
of management, comprising regional directors who report to the 
Chief Executive. 
During the year the committee met formally once and the 
following matters were discussed:
  review and agree the salary levels for the Executive Directors 
and members of the board of management for 2011;
  agree how the annual bonus plan will operate in 2011;
  agree to make awards under the long-term incentive plan 
during 2011.
Governance Empresaria Group plc 
Annual report and accounts 2010
34
Governance
Directors’ remuneration report continued
Audited information
Aggregate Directors’ remuneration
The total amounts for Directors’ remuneration were as follows:
2010
£’000
2009
£’000
Emoluments 605 426
Gain on exercise of share options – 26
Money purchase pension 
contributions 28 31
633 483
Name of Director
Salary
 and fees
£’000
Benefits
in kind
£’000
Annual
bonuses
£’000
2010
Total
£’000
2009*
Total
£’000
Executive
Miles Hunt 201 16 83 300 197
Spencer Wreford
(from 4 May 2010) 83 4 25 113 –
Stuart Kilpatrick
(until 4 May 2010) 67 5 17 89 137
Non-executive
Tony Martin 47 – – 47 42
Penny Freer 28 – – 28 25
Zach Miles 28 – – 28 25
455 25 125 605 426
*  During 2009 all Directors agreed to a 10% reduction of their basic salary/
fees to contribute to the cost reduction exercises being taken throughout 
the Group. 
Benefits in kind include car allowance and private medical 
insurance.
Long term incentive plan (LTIP)
There have been no awards made under the LTIP during 2010 
(2009: nil). 
Directors’ pension entitlements
The Executive Directors are paid a percentage of their basic 
salary as a contribution to their private pension schemes. 
Contributions paid by the Company in respect of such Directors 
were as follows:
2010
£’000
2009
£’000
Miles Hunt 19 18
Spencer Wreford (from 4 May 2010) 7 –
Stuart Kilpatrick (until 4 May 2010) 2 13
28 31
This report was approved by the board of directors on 30 March 
2011 and signed on its behalf by:
Penny Freer
Chairperson, Remuneration committee
30 March 2011
Long-term incentive plan (LTIP)
In July 2008 the Company gained shareholder approval  
to introduce a LTIP for Executive Directors and senior  
executives within the business. The committee has 
responsibility for supervising the scheme and making  
awards under its terms. No awards have been made under  
this scheme as at 31 December 2010. 
Pension arrangements
The Company does not operate a pension scheme. For the 
Executive Directors the Company has agreed to make a 
contribution equal to 10% of salary into private pension 
schemes. For the Group Finance Director, pension contributions 
commenced 6 months following the start of employment.
Shareholding guidelines
There are no requirements for Executive Directors or senior 
executives to hold shares in the Company, however details of 
shares held can be found in the Directors’ report on page 26.
Directors’ contracts
It is the Company’s policy that Executive Directors should have 
contracts with indefinite terms providing for a maximum of one 
year’s notice. In the event of early termination, the Directors’ 
contracts provide for compensation up to a maximum of the 
basic salary for the notice period.
Tony Martin, who is proposed for re-election at the next Annual 
General Meeting, being a Non-executive Director, does not have 
a service contract.
The details of the Directors’ contracts are summarised in the 
table below:
Name of Director Date of contract Notice period
Miles Hunt (Chief Executive) 27 October 2004 12 months
Spencer Wreford  
(Group Finance Director) 4 May 2010 6 months
Chairman and Non-executive Directors
All Non-executive Directors, including the Chairman, serve 
under letters of appointment. Their remuneration is determined 
by the board within the limits set by the Articles of Association 
and is based on information on fees paid in similar companies 
and the skills and expected time commitment of the individual 
concerned. Neither the Chairman nor the Non-executive 
Directors have any right to compensation on the early 
termination of their appointment.
The fees are reviewed in December of each year as part of the 
annual budgeting process.
The fee structure will remain the same for the coming year. Empresaria Group plc 
Annual report and accounts 2010
35
Governance
Independent auditor’s report to the members of 
Empresaria Group plc
Opinion on financial statements
In our opinion the Group financial statements:
  give a true and fair view of the state of the Group’s affairs as 
at 31 December 2010 and of its profit for the year then ended;
  have been properly prepared in accordance with IFRSs as 
adopted by the European Union; and
  have been prepared in accordance with the requirements of 
the Companies Act 2006.
Opinion on other matter prescribed by the Companies 
Act 2006
In our opinion the information given in the Directors’ report for 
the financial year for which the Group financial statements are 
prepared is consistent with the Group financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters 
where the Companies Act 2006 requires us to report to you if, in 
our opinion:
  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.
Other matter
We have reported separately on the parent Company financial 
statements of Empresaria Group plc for the year ended 31 
December 2010.
Ian Smith (Senior statutory auditor)
for and on behalf of Deloitte LLP
Chartered Accountants and Statutory Auditor
Crawley, United Kingdom
30 March 2011
 
We have audited the Group financial statements of Empresaria 
Group plc for the year ended 31 December 2010 which comprise 
the Consolidated Income Statement, the Consolidated 
Statement of Comprehensive Income, the Consolidated 
Balance Sheet, the Consolidated Cash Flow Statement, the 
Consolidated Statement of Changes in Equity and the related 
notes 1 to 28. The financial reporting framework that has been 
applied in their preparation is applicable law and International 
Financial Reporting Standards (IFRSs) as adopted by the 
European Union.
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. 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 Statement of Directors’ 
responsibilities, the Directors are responsible for the 
preparation of the Group 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 Group 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 
Ethical Standards for Auditors.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts  
and disclosures in the financial statements sufficient to give 
reasonable assurance that the financial statements are free 
from material misstatement, whether caused by fraud or error. 
This includes an assessment of: whether the accounting 
policies are appropriate to the Group’s circumstances and  
have been consistently applied and adequately disclosed;  
the reasonableness of significant accounting estimates made  
by the Directors; and the overall presentation of the financial 
statements. In addition, we read all the financial and non-
financial information in the annual report to identify material 
inconsistencies with the audited financial statements. If we 
become aware of any apparent material misstatements or 
inconsistencies we consider the implications for our report.
Governance Empresaria Group plc 
Annual report and accounts 2010
36
Financials
Note
2010
£m
2009
£m
Restated
Continuing operations
Revenue 4 223.4 190.5 
Cost of sales (174.4) (149.9)
Gross profit 4 49.0 40.6 
Administrative costs (41.2) (36.3)
Operating profit before exceptional items and intangible amortisation 7.8 4.3 
Exceptional items 5 – (5.0)
Intangible amortisation (0.3) (0.3)
Operating profit/(loss) 4,7 7.5 (1.0)
Finance income 9 0.4 0.7 
Finance costs 9 (1.2) (1.2)
Profit/(loss) before tax 11 6.7 (1.5)
Income tax 10 (2.3) (0.8)
Profit/(loss) for the period from continued operations 4.4 (2.3)
Discontinued operations
Profit/(loss) for the period from discontinued operations 6 0.2 (1.6)
Profit/(loss) for the year 4.6 (3.9)
Attributable to: 
Equity holders of the parent 3.1 (4.7)
Non-controlling interest 1.5 0.8 
4.6 (3.9)
Earnings/(loss) per share:
From continuing operations
Basic and diluted (pence) 12 6.5 (7.6)
Adjusted earnings per share (pence) 12 6.4 3.9 
From continuing and discontinued operations
Basic and diluted (pence) 12 7.0 (11.6)
Adjusted earnings per share (pence) 12 6.2 3.1 
Details of the restatement can be seen in note 28.
Consolidated Income Statement Empresaria Group plc 
Annual report and accounts 2010
37
Financials
2010
£m
2009
£m
Restated
Exchange differences on translation of foreign operations 0.6 (2.5)
Net income/(expense) recognised directly in equity 0.6 (2.5)
Profit/(loss) for the year 4.6 (3.9)
Total comprehensive income/(expense) for the year 5.2 (6.4)
Attributable to:
Equity holders of the parent 3.4 (7.2)
Non-controlling interest 1.8 0.8
5.2 (6.4)
Details of the restatement can be seen in note 28. 
Consolidated Statement of Comprehensive Income
Financials Empresaria Group plc 
Annual report and accounts 2010
38
Financials
Note
2010
£m
2009
£m
Restated
2008
£m
Restated
ASSETS
Non-current assets
Property, plant and equipment 13 1.9 2.0 2.3 
Goodwill 14 26.4 26.5 31.2 
Other intangible assets 15 2.5 2.7 3.2 
Interest in associates – – 0.1 
Deferred tax assets 20 1.0 0.5 0.5 
Call option asset 22 0.9 0.5 0.8 
32.7 32.2 38.1 
Current assets
Trade and other receivables 17 31.0 28.5 33.3 
Cash and cash equivalents 19 7.1 4.9 5.7 
38.1 33.4 39.0 
Total assets 70.8 65.6 77.1 
LIABILITIES
Current liabilities
Trade and other payables 18 25.0 22.3 26.4 
Current tax liabilities 1.8 1.8 2.6 
Borrowings 19 12.7 4.3 5.4 
Put option liability 22 1.0 0.9 1.4 
40.5 29.3 35.8 
Non-current liabilities
Borrowings 19 0.5 8.6 9.4 
Other creditors – 0.2 – 
Deferred tax liabilities 20 0.6 0.6 0.6 
Total non-current liabilities 1.1 9.4 10.0 
Total liabilities 41.6 38.7 45.8 
Net assets 29.2 26.9 31.3 
EQUITY
Share capital 21 2.2 2.2 1.7 
Share premium account 19.4 19.4 17.0 
Merger reserve 1.5 1.5 1.5 
Retranslation reserve 4.1 3.9 5.6 
Option reserve (0.6) (0.6) (0.6)
Equity reserve (1.9) – – 
Other reserves (0.6) (0.7) 0.1 
Retained earnings 1.5 (1.5) 3.4 
Equity attributable to owners of the Company 25.6 24.2 28.7 
Non-controlling interest 3.6 2.7 2.6 
Total equity 29.2 26.9 31.3 
 
Details of the restatement can be seen in note 28. 
These financial statements of Empresaria Group plc were approved by the board of Directors and authorised for issue on 30 March 2011. 
Signed on behalf of the board of Directors 
Miles Hunt Spencer Wreford
Director Director
 
Consolidated Balance Sheet Empresaria Group plc 
Annual report and accounts 2010
39
Financials
Share
capital
£m
Share
premium
account
£m
Merger
reserve
£m
Retran-
slation
reserve
£m
Option
reserve
£m
Equity
reserve
£m
Other
reserves
£m
Retained
earnings
£m
Non-
cont
rolling
interest
£m
Total
equity
£m
Balance at 1 January 2008 1.7 16.6 1.5 1.0 – – (0.1) 5.3 2.7 28.7 
Issue of share capital – 0.4 – – – – – – – 0.4 
Loss for the year – – – – – – – (1.6) 1.1 (0.5)
Dividend – – – – – – – (0.2) – (0.2)
Currency translation differences – – – 4.6 – – 0.1 – – 4.7 
Recognising option value in equity – – – – (0.6) – – – – (0.6)
Non-controlling interest acquired  
during the year – – – – – – 0.1 (0.1) (0.4) (0.4)
Dividend paid to non-controlling interest – – – – – – – – (0.8) (0.8)
Balance at 1 January 2009 (Restated) 1.7 17.0 1.5 5.6 (0.6) – 0.1 3.4 2.6 31.3 
Issue of share capital 0.5 2.4 – – – – – – – 2.9 
(Loss)/profit for the year – – – – – – – (4.7) 0.8 (3.9)
Dividend – – – – – – – (0.2) – (0.2)
Currency translation differences – – – (1.7) – – (0.8) – – (2.5)
Dividend paid to non-controlling interest – – – – – – – – (0.7) (0.7)
Balance at 31 December 2009 (Restated) 2.2 19.4 1.5 3.9 (0.6) – (0.7) (1.5) 2.7 26.9 
Profit for the year – – – – – – – 3.1 1.5 4.6 
Dividend – – – – – – – (0.2) – (0.2)
Currency translation differences – – – 0.2 – – 0.1 – 0.3 0.6 
Disposal of subsidiary – – – – – – – – 0.1 0.1 
Non-controlling interest acquired  
during the year – – – – – (1.9) – – (0.1) (2.0)
Dividend paid to non-controlling interest – – – – – – – – (0.9) (0.9)
Balance at 31 December 2010 2.2  19.4  1.5  4.1 (0.6) (1.9) (0.6) 1.5  3.6  29.2 
Equity comprises the following:
“Share capital” represents the nominal value of equity shares.
“Share premium account” represents the excess over nominal value of the fair value of consideration received for equity 
 shares, net of expenses of the share issue. 
“Merger reserve” relates to premiums arising on shares issued subject to the provisions of section 612 “Merger relief” of the 
Companies Act 2006. 
“Retranslation reserve” represents the exchange differences arising from the translation of the financial statements of foreign 
subsidiaries. 
“Option reserve” relates to the initial recorded value of the liability relating to the put options held by non-controlling interests over 
the shares in the subsidiary companies net of the initial recorded value of the call options held by the Group over shares held by 
non-controlling interests. 
“Equity reserve” represents movement in equity due to acquisition of non-controlling interests under IFRS 3 (2008). 
“Other reserves” represents exchange differences on inter-Company long-term receivables which are treated as a net investment in 
foreign operations.
“Retained earnings” represents accumulated profits from incorporation.
Consolidated Statement of Changes in Equity 
Financials Empresaria Group plc 
Annual report and accounts 2010
40
Financials
Consolidated Cash Flow Statement
Note
2010
£m
2009
£m
Restated
Profit/(loss) for the year 4.6 (3.9)
Adjustments for:
Depreciation 0.8 0.9 
Intangible amortisation 0.3 0.3 
Taxation expense recognised in income statement 2.3 0.8 
Exceptional charges and impairments – 6.3 
Gain on disposal of subsidiary (0.3) – 
Cash paid for exceptional items – (1.2)
Net finance charge 0.8 0.6 
Operating cash flows before movement in working capital 8.5 3.8 
(Decrease)/increase in invoice discounting (2.4) 1.7 
(Increase)/decrease in trade receivables (1.5) 1.3 
Increase/(decrease) in trade payables 3.7 (3.4)
Cash generated from operations 8.3 3.4 
Interest paid (1.1) (1.0)
Income taxes paid (2.1) (1.7)
Net cash from operating activities 5.1 0.7 
Cash flows from investing activities
Further shares acquired in existing subsidiaries (2.1) (0.2)
Disposal of subsidiary (0.2) – 
Purchase of property, plant and equipment (0.8) (0.6)
Finance income 0.1 0.2 
Net cash used in investing activities (3.0) (0.6)
Cash flows from financing activities
Proceeds from issue of share capital – 2.7 
Increase/(decrease) in borrowings 1.8 (2.2)
Proceeds from bank loan – 0.3 
Repayment of bank and other loans (0.8) (0.5)
Dividends paid (0.2) (0.2)
Dividends paid to non-controlling interest (0.9) (0.7)
Net cash from financing activities (0.1) (0.6)
Net increase/(decrease) in cash and cash equivalents 2.0 (0.5)
Effect of foreign exchange rate changes 0.2 (0.3)
Cash and cash equivalents at beginning of period 4.9 5.7 
Cash and cash equivalents at end of period 19 7.1 4.9  Empresaria Group plc 
Annual report and accounts 2010
41
Financials
1 Basis of preparation and general information
Empresaria Group plc is a company incorporated in the 
United Kingdom under the Companies Act 2006. The address 
of the registered office is Old Church House, Sandy Lane, 
Crawley Down, Crawley, West Sussex, RH10 4HS. Its company 
registration number is 03743194.
The consolidated financial statements are for the twelve 
months ended 31 December 2010. They have been prepared 
in accordance with International Financial Reporting Standards 
(IFRSs). The financial statements have also been prepared 
in accordance with IFRS as adopted by the European Union 
(EU) and therefore the Group financial statements comply with 
Article 4 of the EU IAS Regulation. 
The financial statements have been prepared under the historical 
cost convention except that they have been modified to include 
the revaluation of certain financial assets and liabilities. The 
measurement bases and principal accounting policies of the 
Group are set out below.
These consolidated financial statements are presented in Pounds 
Sterling (£) because that is the presentational currency of the 
Group. Foreign operations are included in accordance with the 
policies set out in note 2.
Adoption of new and revised standards
The following new and revised Standards and Interpretation have 
been adopted in the current year and have affected the amounts 
reported in these financial statements.
IFRS 3 (2008) Business Combinations
IAS 27 (2008)  Consolidated and Separate Financial 
Statements
These standards have introduced a number of changes in 
the accounting for business combinations when acquiring 
a subsidiary. IFRS 3 (2008) has also introduced additional 
disclosure requirements for acquisitions.
The following new and revised Standards and Interpretations 
have been adopted in the current year. Their adoption has not 
had any significant impact on the amounts reported in these 
financial statements but may impact the accounting for future 
transactions and arrangements.
IAS 28 (2008) Investments in Associates 
 Amendment to IFRS 2 (Share based Payment) – following the 
issue of IFRS 3 (2008), IFRS 2 has been amended to confirm 
that the contribution of a business on the formation of a joint 
venture and common control transactions are not within the 
scope of IFRS 2.
 IFRS 2 (amended) (Group Cash-settled Share-based Payment 
Transactions) – The amendment clarifies the accounting for 
share based payment transactions between Group entities.
 Amendment to IAS 17 (Leases) – IAS 17 has been amended 
such that it may be possible to classify a lease of land as a 
finance lease if it meets the criteria for that classification  
under IAS 17.
 Amendment to IAS 39 (Financial Instruments: Recognition and 
Measurement) – IAS 39 has been amended to state that options 
contracts between an acquirer and a selling shareholder to buy 
or sell an acquiree that will result in a business combination  
at a future acquisition date are not excluded from the scope of 
the standard.
 IFRIC 17 (Distributions of Non-cash Assets of Owners) –  
The Interpretation provides guidance on when an entity  
should recognise a non-cash dividend payable, how to  
measure the dividend payable and how to account for 
any difference between the carrying amount of the assets 
distributed and the carrying amount of the dividend payable 
when the payable is settled.
At the date of authorisation of these financial statements, the 
following Standards and Interpretations, which have not been 
applied in these financial statements, were in issue but not yet 
effective and in some cases have not yet been adopted by the EU:
IFRS 9   Financial Instruments
IAS 24 (amended) Related Party Disclosures
IAS 32 (amended) Classification of Right issues
IFRIC 19    Extinguishing Financial Liabilities 
with Equity Instruments
IFRIC 14 (amended)  Prepayments of a Minimum Funding 
Requirement
The Directors anticipate that the adoption of these Standards  
and Interpretations in future periods will have no material  
impact on the consolidated financial statements of the Group.
The accounting policies have been applied consistently 
throughout the Group for the purposes of preparation of these 
consolidated financial statements. 
The Group has taken advantage of certain exemptions available 
under IFRS 1 First-time adoption of International Financial 
Reporting Standards. The exemptions used are explained under 
the respective accounting policy.
Going concern 
The Group’s activities are funded by a combination of long-term 
equity capital, term loans, a revolving credit facility, short-term 
invoice discounting and bank overdraft facilities. The day-to-
day operations are funded by cash generated from trading and 
from invoice discounting facilities. The board has reviewed the 
Group’s profit and cash flow projections, and applied sensitivities 
to the underlying assumptions.
These projections suggest that the Group will meet its 
obligations as they fall due with the use of existing facilities.  
The Group’s overdraft facilities are due for renewal in March 2012 
and, based on informal discussions the board has had with its 
lenders, we have no reason to believe that these facilities will not 
continue to be available to the Group for the foreseeable future. 
The financial statements do not reflect the adjustments that 
would be necessary were the trading performance of the Group 
to deteriorate significantly or if the funding available from invoice 
discounting or overdrafts were to become unavailable. Thus the 
Group continues to adopt the going concern basis of accounting 
in preparing the financial statements.
Notes to the Consolidated Financial Statements
Financials Empresaria Group plc 
Annual report and accounts 2010
42
Financials
Notes to the Consolidated Financial Statements continued
2 Summary of significant accounting policies 
Basis of consolidation 
The Group financial statements consolidate those of the 
Company and all of its subsidiary undertakings as at 31 
December 2010. Subsidiaries are entities over which the Group 
has the power to control the financial and operating policies so 
as to obtain benefits from their activities. The Group obtains and 
exercises control through voting rights.
Intra-Group transactions and profits are eliminated fully on 
consolidation. Amounts reported in the financial statements 
of subsidiaries have been adjusted where necessary to ensure 
consistency with the accounting policies adopted by the Group.
Non-controlling interests in the net assets of consolidated 
subsidiaries are identified separately from the Group’s equity 
therein. Non-controlling interest consists of the amount of those 
interests at the date of the original business combination and 
the non-controlling interest’s share of changes in equity since 
the date of the combination. Total comprehensive income is 
attributed to non-controlling interests even if this results in the 
non-controlling interest having a deficit balance.
The results of subsidiaries acquired or disposed of during the 
year are included in the consolidated income statement from the 
effective date of acquisition or up to the effective date of disposal, 
as appropriate.
Changes in the Group’s interests in subsidiaries that do not result 
in a loss of control are accounted for as equity transactions. The 
carrying amount of the Group’s interests and the non-controlling 
interests are adjusted to reflect the changes in their relative 
interests in the subsidiaries. Any difference between the amount 
by which the non-controlling interests are adjusted and the fair 
value of the consideration paid or received is recognised directly 
in equity and attributed to the owners of the Company.
Business combinations
The acquisition of subsidiaries is accounted for using the 
acquisition method. The cost of the acquisition is measured at 
the aggregate of the fair value, at the date of exchange, of assets 
given, liability incurred or assumed, and equity instruments 
issued by the Group in exchange for control of the acquiree. 
Acquisition-related costs are recognised in profit or loss as 
incurred. Where applicable, the consideration for the acquisition 
includes any asset or liability resulting from a contingent 
consideration arrangement, measured at its acquisition-
date fair value. Subsequent changes in such fair values are 
adjusted against the cost of acquisition where they qualify as 
measurement period adjustments. All other subsequent changes 
in the fair value of contingent consideration classified as an asset 
or liability are recognised in the income statement as per IFRS3 
(2008). Changes in the fair value of contingent consideration 
classified as equity are not recognised.
When a business combination is achieved in stages, the Group’s 
previously-held interests in the acquired entity are remeasured 
to fair value at the acquisition date (ie the date the Group attains 
control) and the resulting gain or loss, if any, is recognised in 
profit or loss. Amounts arising from interests in the acquiree 
prior to the acquisition date that have previously been recognised 
in other comprehensive income are reclassified to profit or loss, 
where such treatment would be appropriate if that interest was 
disposed of.
The acquiree’s identifiable assets, liabilities and contingent 
liabilities that meet the conditions for recognition under IFRS 3 
(2008) are recognised at their fair value at the acquisition date, 
except for deferred tax assets and liabilities or assets related 
to employee benefit arrangements which are recognised and 
measured in accordance with IAS 12 Income taxes and IAS 19 
Employee Benefits respectively. Liabilities or equity instruments 
related to the replacement by the Group of an acquiree’s share 
based payment awards are measured in accordance with IFRS 
2 Share based Payment. Assets (or disposal groups) that are 
classified as held for sale in accordance with IFRS 5 Non-Current 
Assets Held for Sales and Discontinued Operations are measured 
in accordance with that standard.
If the initial accounting for a business combination is incomplete 
by the end of the reporting period in which the combination 
occurs, the Group reports provisional amounts for items for 
which the accounting is incomplete, which are adjusted during 
the measurement period, or additional assets or liabilities 
are recognised, to reflect the new information obtained. The 
measurement period is the period from the date of acquisition 
to the date the Group obtains complete information about facts 
and circumstances that existed as at the acquisition date and is a 
maximum of one year.
Goodwill
Goodwill arising on a business combination is recognised as 
an asset at the date that control is acquired and is stated after 
separating out identifiable intangible assets.
Goodwill represents the excess of acquisition cost over the 
fair value of the Group’s share of the identifiable net assets 
of the acquired subsidiary at the date of acquisition. If, after 
measurement, the Group’s interest in the net fair value of the 
identifiable assets, liabilities and contingent liabilities exceeds 
the cost of the business combination, the excess is recognised 
immediately in the income statement. 
Goodwill is not amortised but is tested at least annually for 
impairment. Goodwill is allocated to each of the Group’s 
cash-generating units. If the recoverable amount of the cash-
generating unit is less than the carrying amount of the unit, the 
impairment loss is first allocated against goodwill and then to the 
other assets of the unit on a pro-rata basis. Goodwill is carried at 
cost less accumulated impairment losses. Empresaria Group plc 
Annual report and accounts 2010
43
Financials
2 Summary of significant accounting policies continued 
On disposal of a subsidiary, the attributable goodwill is included 
in the calculation of profit or loss on disposal.
Goodwill arising on acquisitions before the date of transition 
to IFRS (1 January 2006) has been retained at the previous UK 
GAAP carrying amount.
Intangible assets 
An intangible asset, which is an identifiable non-monetary asset 
without physical substance, is recognised to the extent that it is 
probable that the expected future economic benefits attributable 
to the asset will flow to the Group and that its cost can be 
measured reliably. The asset is deemed to be identifiable when 
it is separable or when it arises from contractual or other legal 
rights.
Amortisation of intangible assets
Amortisation is charged to the income statement and calculated 
using the straight-line method over its estimated useful life  
as follows: 
Customer relations over fifteen years
Trademarks  over fifteen years
Software   between one and two years
Impairment of assets 
The carrying amounts of the Group’s tangible and intangible 
assets are reviewed against their recoverable amount for any 
indication of impairment at each balance sheet date or whenever 
there is an indication that the asset may be impaired. An 
impairment loss is recognised whenever the carrying  
amount of an asset or its cash-generating unit exceeds its 
recoverable amount. 
The recoverable amount is the greater 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 an asset that does not generate largely independent cash 
inflows, the recoverable amount is determined for the cash-
generating unit to which the asset belongs. Impairment losses 
are recognised in the income statement. Where an impairment 
loss subsequently reverses, the carrying amount of the asset is 
increased to the revised estimate of its recoverable amount, such 
that it does not exceed the carrying amount that would have 
existed had no impairment loss been recognised. The reversal of 
the impairment loss is recognised in profit or loss.
Impairment losses recognised in respect of cash-generating 
units are allocated first to reduce the carrying amount of any 
goodwill allocated to cash-generating units and then to reduce 
the carrying amount of the other assets in the unit on a pro rata 
basis. A cash-generating unit is the smallest identifiable group of 
assets that generates cash inflows that are largely independent of 
the cash inflows from other assets or groups of assets.
Property, plant and equipment 
Property, plant and equipment is stated at historical cost, net of 
depreciation and any provisions for impairment. 
Depreciation is calculated using the straight-line method to 
allocate the depreciable value of property, plant and equipment to 
the income statement over their useful economic lives as follows: 
Leasehold property  over the term of the lease
Fixtures, fittings and equipment between one and two years
Motor vehicles   over five years
Gains and losses on disposals are determined by comparing 
proceeds with carrying amounts. These are included in the 
income statement.
Cash and cash equivalents
Cash and cash equivalents comprise cash-in-hand, deposits held 
at call with banks and other short-term highly liquid investments 
with original maturities of three months or less. Bank overdrafts 
are included within the balance sheet in current liabilities –  
short-term borrowings. 
Financial assets 
Financial assets are recognised in the Group’s balance sheet 
and, other than hedging instruments, can be divided into the 
following categories:
loans and receivables
financial assets at fair value through profit and loss
available-for-sale financial assets.
Financial assets are assigned to the different categories on initial 
recognition, depending on the characteristics of the instrument 
and its purpose. A financial instrument’s category is relevant 
for the way it is measured and whether resulting income and 
expenses are recognised in profit or loss or charged directly 
against equity. 
Generally, the Group recognises all financial assets using 
settlement day accounting. An assessment of whether a financial 
asset is impaired is made at least at each reporting date. For 
receivables, this is based on the latest credit information 
available, (ie. recent third-party defaults and external credit 
ratings). Financial assets that are substantially past due are also 
considered for impairment. All income and expense relating to 
financial assets are recognised in the income statement line item 
Finance costs or Finance income, respectively.
Loans and receivables are non-derivative financial assets with 
fixed or determinable payments that are not quoted in an active 
market. They are measured at amortised cost using the effective 
interest method, less provision for impairment. Any change in 
their value is recognised in profit or loss. The Group’s trade and 
other receivables fall into this category of financial instruments. Empresaria Group plc 
Annual report and accounts 2010
44
Financials
2 Summary of significant accounting policies continued 
Individual receivables are considered for impairment when 
they are past due at the balance sheet date or when objective 
evidence is received that a specific third party will default. All 
other receivables are reviewed for impairment in groups, which 
are determined by reference to the industry and region of a third 
party. The percentage of the write-down is then based on recent 
historical third-party default rates for each identified group.
Financial assets at fair value through profit or loss include 
financial assets that are either classified as held for trading or 
are designated to be carried at fair value through profit or loss 
upon initial recognition. By definition, all derivative financial 
instruments that do not qualify for hedge accounting fall into this 
category. Empresaria’s management, however, does not consider 
any other financial asset for designation into this category. Trade 
receivables are reported net of non-recourse invoice financing 
liabilities.
Any gain or loss arising from derivative financial instruments is 
based on changes in fair value, which is determined by direct 
reference to active market transactions.
All other financial assets within this category are measured at 
fair value, with changes in value recognised in equity. Gains 
and losses arising from financial instruments classified as 
available-for-sale are recognised in the income statement 
when they are sold or when the investment is impaired. In the 
case of impairment, any loss previously recognised in equity 
is transferred to the income statement. Losses recognised in 
the income statement on equity instruments are not reversed 
through the income statement. Losses recognised in prior period 
consolidated income statements resulting from the impairment of 
loans and receivables are reversed through the income statement.
The Group is a party to a number of put and call options over the 
remaining non-controlling interests in some of its subsidiaries.  
The initial fair value of these commitments is recognised as an 
asset or liability with a corresponding movement in reserves.  
Subsequent changes in the value are reflected in the consolidated 
income statement.
Financial liabilities and equity instruments 
Financial liabilities and equity instruments are classified 
according to the substance of the contractual arrangements 
entered into. 
Financial liabilities 
The Group’s financial liabilities include borrowings, trade and 
other payables (including finance lease liabilities). Borrowings 
are recognised initially at fair value, net of transaction costs 
incurred. Borrowings, trade and other payables are subsequently 
stated at amortised cost. Any difference between the proceeds 
(net of transaction costs) and the redemption value is recognised 
in the income statement over the period of the borrowings using 
the effective interest method.
Financial liabilities are recognised when the Group becomes 
a party to the contractual agreements of the instrument. All 
interest-related charges and, if applicable, changes in the 
instrument’s fair value that are reported in the profit or loss are 
included in the income statement line items Finance costs or 
Finance income.
Borrowings are classified as current liabilities unless the Group 
has an unconditional right to defer settlement of the liability for 
at least 12 months after the balance sheet date.
Provisions
Provisions are recognised when the Group has a present 
obligation as a result of a past event, it is probable that the 
Group will be required to settle that obligation and a reliable 
estimate can be made of the amount of the obligation. Provisions 
are measured at the Directors’ best estimate of the expenditure 
required to settle the obligation at the balance sheet date, and are 
discounted to present value where the effect is material. 
Equity instruments 
An equity instrument is any contract that evidences a residual 
interest in the assets of the Group after deducting all of its 
liabilities.
Revenue and revenue recognition 
Revenue comprises the fair value of the consideration received or 
receivable for the sale of services provided in the ordinary course 
of the Group’s activities. Revenue is shown net of value added 
tax, trade discounts and other sales-related taxes.
Permanent placement revenue is recognised at the point when 
the candidate commences employment. Contract placement 
revenue is recognised on the basis of actual work performed in 
the relevant period based on timesheets submitted. 
Employee benefits 
Retirement benefit costs
Payments made to defined contribution retirement benefit 
schemes are charged as an expense as they fall due.
Share based payments 
The Group issues equity-settled share based payments to certain 
key employees, which 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 the 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.
The fair value of the options granted is measured using a Monte 
Carlo simulation model, taking into account the terms and 
conditions upon which the options were granted.
Notes to the Consolidated Financial Statements continued Empresaria Group plc 
Annual report and accounts 2010
45
Financials
2 Summary of significant accounting policies continued 
Leases 
Leases that result in the Group receiving substantially all of the 
risks and rewards of ownership of an asset are treated as finance 
leases. An asset held under a finance lease is recorded in the 
balance sheet and depreciated over the shorter of its estimated 
useful life and the lease term. Future installments net of finance 
charges are included within borrowings. Minimum lease 
payments are apportioned between the finance charge element, 
which is allocated to each period to produce a constant periodic 
rate of interest on the remaining liability and charged to the 
income statement and the principal element which reduces the 
outstanding liability. 
Rental costs arising from operating leases are charged on 
a straight-line basis over the period of the lease. Where an 
incentive is received to enter into an operating lease, such 
incentive is treated as a liability and recognised as a reduction  
to the rental expense on a straight-line basis over the period of 
the lease.
Current and deferred tax
The tax expense represents the sum of the tax currently payable 
and deferred tax.
Current tax is the tax currently payable based on taxable profit 
for the year. Taxable profit differs from net profit as reported 
in the income statement because it excludes items of income 
or expense that are taxable or deductible in other years and it 
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 
and their tax bases and is accounted for using the balance sheet 
liability method. Deferred tax liabilities are generally provided 
in full, with no discounting. Deferred tax assets are recognised 
to the extent that it is probable that the underlying deductible 
temporary differences will be able to be offset against future 
taxable income. However, deferred tax is not provided on the 
initial recognition of goodwill, nor on the initial recognition of 
an asset or liability, unless the related transaction is a business 
combination or affects tax or accounting profit. The carrying 
amounts of deferred tax assets are reviewed at each balance 
sheet date and reduced to the extent that it is no longer probable 
that there will be sufficient future taxable profit to allow the asset 
to be recovered.
Deferred tax liabilities are recognised for taxable temporary 
differences arising on investments in subsidiaries, except 
where the Group is able to control the reversal of the temporary 
difference and it is probable that it will not reverse in the 
foreseeable future.
Deferred tax is calculated at tax rates that are expected to apply 
in the relevant period of realisation, provided they are enacted or 
substantively enacted at the balance sheet date.
Changes in deferred tax assets or liabilities are recognised as a 
component of tax expense in the income statement, except where 
they relate to items that are charged or credited directly to equity 
in which case the related deferred tax is also charged or credited 
directly to equity.
Foreign currencies 
(i) Functional and presentational currency
Items included in the individual financial statements of each of 
Empresaria Group plc’s subsidiaries are measured using the 
individual currency of the primary economic environment in 
which that subsidiary operates (its “functional currency”). The 
consolidated financial statements of Empresaria Group plc are 
presented in Pounds Sterling which is Empresaria Group plc’s 
functional and presentational currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional 
currency using the exchange rates prevailing at the dates of the 
transactions. Foreign exchange gains and losses resulting from 
the settlement of such transactions and from the translation at 
period-end exchange rates of monetary assets and liabilities 
denominated in foreign currencies are recognised in the income 
statement. Exchange differences on monetary items receivable 
from or payable to a foreign operation for which settlement is 
neither planned nor likely to occur (therefore forming part of the 
net investment in the foreign operation) are recognised initially 
in other comprehensive income. These exchange differences are 
reclassified from equity to profit or loss on disposal or partial 
disposal of the net investment.
(iii) Group companies
The results and financial position of Empresaria Group plc’s 
subsidiaries (none of which has the currency of a hyper-
inflationary economy) that have a functional currency different 
from Empresaria Group plc’s presentation currency are translated 
into the presentation currency as follows:
assets and liabilities for each balance sheet presented are 
translated at the closing rate at the date of that balance sheet;
income and expenses for each income statement are translated 
at average exchange rates (unless this average is not a 
reasonable approximation of the cumulative effect of the rates 
prevailing on the transaction dates, in which case income and 
expenses are translated at the dates of the transactions); and
 all resulting exchange differences are recognised as a separate 
component of equity.
On consolidation, exchange differences arising from the 
translation of the net investment in foreign entities are taken 
to shareholders’ equity. When a foreign operation is sold, such 
accumulated exchange differences are recognised in the income 
statement as part of the gain or loss on sale.  Empresaria Group plc 
Annual report and accounts 2010
46
Financials
2 Summary of significant accounting policies continued 
(iv) Derivative financial instruments
The Group’s activities expose it primarily to the financial risks 
of changes in foreign currency exchange rates and interest rates. 
The Group may use foreign exchange forward contracts to hedge 
the foreign currency exposures. The Group does not use financial 
instruments for speculative purposes. Changes in the fair value 
of derivative financial instruments are recognised in the income 
statement as they arise.
(v) Hedges of net investments in foreign operations
Any gain or loss on the hedging instrument relating to the 
effective portion of net investment hedge is recognised in equity 
in the foreign currency translation reserve. The gain or loss 
relating to the ineffective portion is recognised immediately in  
the profit and loss. Gains and losses deferred in the foreign 
currency translation reserve are reclassified to profit or loss on 
disposal of the foreign operation.
Goodwill and fair value adjustments arising on the acquisition of 
a foreign entity are treated as assets and liabilities of the foreign 
entity and translated at closing rate. The Group has elected to 
treat goodwill arising on acquisitions before the date of transition 
to IFRSs as Sterling-denominated assets and liabilities.
3  Critical accounting judgements and key sources  
of estimation uncertainty
The preparation of consolidated financial statements under  
IFRS requires the Group to make estimates and assumptions  
that affect the application of policies and reported amounts. 
Estimates and judgements are continually evaluated and are 
based on historical experience and other factors including 
expectations of future events that are believed to be reasonable 
under the circumstances. Actual results may differ from these 
estimates. The estimates and assumptions which have a risk of 
causing a material adjustment to the carrying amount of assets 
and liabilities are discussed below.
Impairment of goodwill 
The Group is required to test whether goodwill has suffered any 
impairment. The recoverable amount is determined based on 
the value-in-use calculations. The use of this method requires 
the estimation of future cash flows and the choice of a suitable 
discount rate in order to calculate the present value of these cash 
flows. Details of the impairment review calculation are set out in 
note 14. 
Intangible assets (including goodwill) 
The Group recognises intangible assets acquired as part of 
business combinations at fair value at the date of acquisition. 
The determination of these fair values is based upon 
management’s judgement and includes assumptions on the 
timing and amount of future incremental cash flows generated  
by the assets and selection of an appropriate cost of capital. 
In addition, management must assess the value of any 
contingent consideration that is due to the seller following the 
completion of the initial purchase. The value of this consideration 
is frequently based on the financial performance of the business 
post acquisition. Therefore management must assess the likely 
value of this performance and so give a value to the expected 
contingent consideration. Actual post-completion performance 
may vary from management’s estimate.
Furthermore, management must estimate the expected useful 
lives of intangible assets and charge amortisation on these assets 
accordingly.
The carrying amount at the balance sheet date of goodwill was 
£26.4m (2009: £26.5m), of other intangible assets was £2.5m 
(2009: £2.7m) and of contingent consideration was £0.3m (2009: 
£0.3m). The Group has recognised amortisation of intangible 
assets of £0.3m (2009: £0.3m). Further details of these balances 
are disclosed in notes 14 and 15. 
Valuation of put and call options
The Group’s acquisition of the Headway companies in Germany 
included put and call arrangements which enable the purchaser 
or the seller to exercise options to purchase or sell any remaining 
interest in the acquired entity. The Group accounts for the value 
of the put option based on the value that is considered payable 
based on the term of the option. The value is reviewed at each 
reporting period. The Group recognises the fair value of the 
call option using a Black Scholes option pricing model. The 
Black Scholes option pricing model requires management to 
make certain assumptions and estimates in respect of market 
multiples, risk-free rates and volatility.
Provisions
A provision is recognised in the balance sheet when the Group 
has a present legal or constructive obligation as a result of a past 
event, and it is probable that an outflow of economic benefits will 
be required to settle the obligation.
As part of the put and call options attached to the Headway 
acquisition, a penalty is payable if certain options are not 
exercised. At year end management do not believe that it is 
probable that the penalty will be payable and therefore only 
disclose this liability. Full details are disclosed in note 25.
Recognition of deferred tax asset 
Empresaria’s management bases its assessment of the 
probability of future taxable income on the Group’s latest 
approved budget forecast, which is adjusted for significant 
non-taxable income and expenses and specific limits on the use 
of any unused tax loss or credit. The specific tax rules in the 
jurisdiction Empresaria operates in are also carefully taken into 
consideration. If a positive forecast of taxable income indicates 
the probable use of a deferred tax asset, especially when it can 
be utilised without a time limit, that deferred tax asset is usually 
recognised in full. The recognition of deferred tax assets that 
are subject to certain legal or economic limits or uncertainties is 
assessed individually by Empresaria’s management based on the 
specific facts and circumstances.
Notes to the Consolidated Financial Statements continued Empresaria Group plc 
Annual report and accounts 2010
47
Financials
4 Segment analysis
The revenue and profit before taxation are attributable to the Group’s one principal activity, the provision of staffing and recruitment 
services, and can be analysed by geographic segment as follows. The Group’s reportable segments are business units based in 
different geographic regions. Each unit is managed separately with local management responsible for determining local strategy. 
Information reported to the Group’s Chief Executive for the purpose of resource allocation and assessment of segment performance is 
based on profit or loss from operations before amortisation of intangible assets and exceptional items.
The analysis of the Group’s business by geographical origin is set out below:
Year ended 31st December 2010 
UK
£m
Continental
Europe
£m
Rest of the
World
£m
Eliminations
£m
Total
£m
Revenue 81.0 99.4 43.0 223.4 
Gross profit 17.0 21.9 10.1 49.0 
Adjusted operating profit* 2.2 3.9 1.7 7.8 
Operating profit 2.2 3.7 1.6 7.5 
Goodwill  8.1 14.0 4.3 26.4
Segmental assets  45.4 23.1 16.3 (40.5) 44.3 
Segmental liabilities  (44.4) (25.1) (8.5) 36.3 (41.7)
Net assets  9.1 12.0 12.1 (4.2) 29.0 
Capital expenditure incurred (including intangibles) 0.3 0.3 0.2 0.8 
Significant non-cash expenses  
(depreciation, amortisation and impairment) 0.3 0.5 0.3 1.1 
* Adjusted operating profit represents operating profit before exceptional items and intangible amortisation.
Year ended 31st December 2009 (Restated) 
UK
£m
Continental
 Europe
£m
Rest of the
 World
£m
Eliminations
£m
Total
£m
Revenue 75.7 80.1 34.7 190.5 
Gross profit 14.8 18.1 7.7 40.6 
Adjusted operating profit 2.0 2.0 0.3 4.3 
Operating profit/(loss) 0.5 0.7 (2.2) (1.0)
  
Goodwill 8.1 14.5 3.9 26.5
Segmental assets 50.4 22.6 13.2 (47.1) 39.1 
Segmental liabilities (48.3) (25.7) (9.9) 45.2 (38.7)
Net assets 10.2 11.4 7.2 (1.9) 26.9 
  
Capital expenditure incurred (including intangibles) 0.3 0.3 0.1 0.7
Significant non-cash expenses  
(depreciation, amortisation and impairment) 1.4 1.9 2.5 5.8 Empresaria Group plc 
Annual report and accounts 2010
48
Financials
4 Segment analysis continued
Year ended 31st December 2008 (Restated)
UK
£m
Continental
Europe
£m
Rest of the
World
£m
Eliminations
£m
Total
£m
Goodwill 8.7 17.1 5.4 31.2 
Segmental assets 50.2 25.4 12.0 (41.7) 45.9 
Segmental liabilities (49.2) (28.3) (7.0) 38.7 (45.8)
Net assets 9.7 14.2 10.4 (3.0) 31.3 
Capital expenditure incurred (including intangibles) 0.3 0.3 0.1 0.7 
Significant non-cash expenses  
(depreciation, amortisation and impairment) 0.9 1.9 0.3 3.1 
5 Exceptional items
Exceptional items are those which, in management’s judgement, need to be disclosed separately by virtue of their size or incidence in 
order for the reader to obtain a proper understanding of the financial information.
Exceptional items from continuing operations
2010
£m
2009
£m
UK
Goodwill impairment and businesses disposed – 1.2 
Restructuring costs – 0.3 
– 1.5 
Continental Europe
Goodwill impairment and businesses disposed – 0.3
Restructuring costs – 0.8 
– 1.1 
Rest of the World
Goodwill impairment and businesses disposed – 2.4 
– 2.4 
Total – 5.0 
Exceptional items from discontinuing operations
Continental Europe
Goodwill impairment and businesses disposed – 0.9
Restructuring costs – 0.4
– 1.3 
Total exceptional items from continuing and discontinued operations – 6.3 
Notes to the Consolidated Financial Statements continued Empresaria Group plc 
Annual report and accounts 2010
49
Financials
6 Discontinued operations
On 14 April 2010, the Group disposed of EAR Holdings BV (EAR), which carried out operations in the Netherlands. The results of the 
discontinued operations which have been included in the consolidated income statement were as follows:
2010
£m
2009
£m
Revenue 0.3 4.7
Costs (0.4) (5.0)
Loss from discontinued operations (0.1) (0.3)
Goodwill impairment – (0.9)
Exceptional restructuring costs – (0.4)
Profit on disposal of subsidiary 0.3 –
Net profit/(loss) from discontinued operations 0.2 (1.6)
A profit of £0.3m arose on the disposal of EAR, being the costs of disposal less the carrying amount of the subsidiary’s net liabilities 
and attributable goodwill. Consideration received was €1, with payments due to the buyer of €175,000. 
During the period EAR contributed £0.3m to the Group’s net operating cash outflows (2009: £0.3m outflow) and paid £nil in respect of 
financing activities (2009: £0.1m).
The net assets of EAR at the date of disposal were as follows:
2010
£m
Property, plant and equipment 0.1
Trade and other receivable 0.8
Trade and other payable (1.2)
Bank borrowings (0.3)
Net liabilities (0.6)
Non-controlling interest and retranslation reserve 0.1 
Disposal costs 0.2 
Profit on disposal 0.3 
7 Operating profit/(loss)
Operating profit/(loss) is stated after charging:
2010
£m
2009
£m
Restated
Depreciation of property, plant and equipment 0.8 0.9 
Amortisation of intangible assets 0.3 0.3 
Operating lease charges:
– Land and buildings 1.6 1.7 
– Motor vehicles 0.7 0.7 
Goodwill impairments – 4.6 
Trade receivable impairments 0.1 0.3 
Auditors’ remuneration 0.1 0.1 
Operating profit includes a foreign exchange loss of £41,000 (2009: gain £23,000). Empresaria Group plc 
Annual report and accounts 2010
50
Financials
7 Operating profit/(loss) continued
The analysis of auditors’ remuneration is as follows: 
2010
£m
2009
£m
Auditors’ remuneration:
– Fee payable to the Company’s auditors for the audit of the Company’s annual accounts 0.1 0.1 
Total auditors’ remuneration 0.1 0.1 
Auditors’ remuneration includes fees payable of £12,000 (2009: £12,000) to the Company auditors for the audit of the Company’s 
subsidiaries pursuant to legislation and fee payable of £3,000 (2009: £nil) for tax advisory services. 
8 Directors and employees
2010
£m
2009
£m
Restated
Staff costs 
Wages and salaries 22.5 19.7 
Social security costs 3.0 2.6 
Pension costs 0.3 0.2 
25.8 22.5
No. No.
Average monthly number of persons employed (including Directors)
Sales, distribution and administration 832 763
9 Finance income and cost 
2010
£m
2009
£m
Restated
Finance income
Bank interest receivable 0.1 0.2 
Movement in put option liability – 0.5 
Movement in call option assets 0.3 – 
0.4 0.7 
Finance cost
Bank loans and overdrafts (0.8) (0.7)
On amounts payable to invoice discounters (0.3) (0.3)
Movement in put option liability (0.1) – 
Movement in call option assets – (0.2)
(1.2) (1.2)
Net finance cost (0.8) (0.5)
 
Notes to the Consolidated Financial Statements continued Empresaria Group plc 
Annual report and accounts 2010
51
Financials
10 Taxation
(a) The tax charge for the year was based on the following: 
2010
£m
2009
£m
Current taxation
Current tax (2.4) (0.8)
Adjustment to tax charges in respect of previous periods (0.3) (0.1)
(2.7) (0.9)
Deferred tax 0.4 0.1 
Total income tax expense in the income statement (2.3) (0.8)
(b) Factors affecting the tax charge for the year
2010
£m
2009
£m
Profit before taxation 6.7 (1.5)
Profit before tax at standard rate of corporation tax in the UK of 28% (2009: 28%) (1.9) 0.4 
Effects of:
Expenses not deductible for tax purposes (0.1) (0.1)
Non-taxable income 0.1 – 
Losses not recognised tor tax purposes (0.2) (0.5)
Deferred tax on losses and other timing differences previously not recognised 0.3 – 
Adjustment to tax charges in respect of previous periods (0.3) (0.1)
Overseas tax at different tax rates (0.2) 0.1 
Amortisation of intangibles, goodwill impairment – (0.6)
Tax expense (2.3) (0.8)
The movement in deferred tax is explained in note 20. 
11 Reconciliation of adjusted profit before tax to profit before tax 
2010
£m
2009
£m
Restated
Profit/(loss) before tax 6.7 (1.5)
Amortisation of intangibles 0.3 0.3 
Exceptional items – 5.0 
Movement in put option liability 0.1 (0.5)
Movement in fair value of call option assets (0.3) 0.2 
Adjusted profit before tax from continuing operations 6.8 3.5  Empresaria Group plc 
Annual report and accounts 2010
52
Financials
12 Earnings/(loss) per share
The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders divided by the average 
number of shares in issue during the year. Based on current trading conditions, the Directors are of the opinion that there would be no 
dilution to the earnings per share figure resulting from subsidiary minority shareholders trading up. A reconciliation of the earnings 
and weighted average number of shares used in the calculations are set out below. 
The calculation of the basic and diluted earnings per share is based on the following data:
a) From continuing and discontinued operations
2010
£m
2009
£m
Restated
Earnings
Earnings/(loss) attributable to equity holders of the parent 3.1 (4.7)
Adjustments:
 Exceptional items – 6.3 
 Gain on business disposal (0.3) – 
 Movement in put option liability 0.1 (0.5)
 Movement in fair value of call option asset (0.3) 0.2 
 Amortisation of intangible assets 0.3 0.3 
 Tax on exceptional items and intangible amortisation – (0.2)
 Non-controlling interest in intangible amortisation and exceptional items (0.1) (0.1)
Earnings for the purpose of adjusted earnings per share 2.8 1.3 
Number of shares Millions Millions
Weighted average number of shares – basic and diluted 44.6 40.6
Earnings/(loss) per share
Basic and diluted 7.0 (11.6)
Adjusted earnings per share 6.2 3.1 
b) From continuing operations
2010
£m
2009
£m
Restated
Earnings
Earnings/(loss) attributable to equity holders of the parent 3.1 (4.7)
Adjustments to exclude (profit)/loss from discontinued operations (0.2) 1.6 
Earnings from continuing operations for the purpose of basic and diluted earnings per share 2.9 (3.1)
Adjustments:
 Exceptional items – 5.0 
 Movement in put option liability 0.1 (0.5)
 Movement in fair value of call option asset (0.3)  0.2 
 Amortisation of intangible assets 0.3 0.3 
 Tax on exceptional items and intangible amortisation – (0.2)
 Non-controlling interest in intangible amortisation and exceptional items (0.1) (0.1)
Earnings for the purpose of adjusted earnings per share 2.9 1.6 
Number of shares Millions Millions
Weighted average number of shares – basic and diluted 44.6 40.6
Earnings/(loss) per share
Basic and diluted 6.5 (7.6)
Adjusted earnings per share 6.4 3.9 
Notes to the Consolidated Financial Statements continued Empresaria Group plc 
Annual report and accounts 2010
53
Financials
13 Property, plant and equipment
Leasehold
property
£m
Fixtures,
fittings and
equipment
£m
Motor
vehicles
£m
Total
£m
Cost
At 1 January 2010 0.2 7.2 0.2 7.6 
Additions – 0.8 – 0.8 
Disposals – (0.8) – (0.8)
At 31 December 2010 0.2 7.2 0.2 7.6
     
Accumulated depreciation
At 1 January 2010 0.1 5.4 0.1 5.6 
Charge for the year – 0.8 – 0.8 
Disposals – (0.7) – (0.7)
At 31 December 2010 0.1 5.5 0.1 5.7
      
Net book value
At 31 December 2009: restated and disclosed 0.1 1.8 0.1 2.0 
At 31 December 2010 0.1 1.7 0.1 1.9 
Fixtures, fittings and equipment includes £0.1m (2009: £0.1m, 2008: £0.3m) of secured finance leases. 
Leasehold
property
£m
Fixtures,
fittings and
equipment
£m
Motor
vehicles
£m
Total
£m
Cost
At 1 January 2009 0.2 7.0 0.2 7.4 
Acquisition – 0.1 – 0.1 
Additions – 0.7 – 0.7 
Disposals – (0.3) – (0.3)
Exchange differences – (0.3) – (0.3)
At 31 December 2009 0.2 7.2 0.2 7.6 
     
Accumulated depreciation
At 1 January 2010 0.1 4.9 0.1 5.1 
Acquisition – (0.1) – (0.1)
Charge for the year – 0.9 – 0.9 
Disposals – (0.2) – (0.2)
Exchange differences – (0.1) – (0.1)
At 31 December 2009 0.1 5.4 0.1 5.6 
    
Net book value
At 31 December 2008: restated and disclosed 0.1 2.1 0.1 2.3 
At 31 December 2009: restated and disclosed 0.1 1.8 0.1 2.0  Empresaria Group plc 
Annual report and accounts 2010
54
Financials
14 Goodwill
2010
£m
2009
£m
2008
£m
At 1 January 26.5 31.2 22.6
Acquisition of new subsidiary undertakings – 1.1 2.0
Acquisition of additional shares in existing subsidiaries – 0.3 3.8
Impairments – (4.6) (1.9)
Foreign exchange (0.1) (1.5) 4.7
At 31 December 26.4 26.5 31.2
Goodwill has been tested for impairment by comparing the carrying amount of each cash-generating unit (CGU), including goodwill, 
with the recoverable amount of that income-generating unit. 
The recoverable amount of each cash-generating unit is determined based on the higher of value-in-use calculations and its fair value 
less costs to sell. The value-in-use calculations are based on cash flow projections derived from the Group budget for the year ended 
31 December 2011 and managements’ internal 5 year forecast which have then been extrapolated over a total period of 15 years. The 
key assumptions for this calculation are in growth rates and discount rates. The growth rates applied after the forecasts are based on 
the relevant country GDP growth estimates for the next 5 years, which ranged from 1.8% to 5.0%. Any growth rate in excess of 5.0% 
was capped for the purpose of this calculation. A discount rate of 8.5% (2009: 5.7%) has been applied in discounting the projected 
cash flows, being the Group’s weighted average cost of capital. Where higher growth rates were applied a discount rate of 9.5% has 
been used to reflect the greater risk to the forecast.
As part of the impairment review, management has considered the sensitivity of the recoverable amount for each unit to changes in 
the growth rate and discount rate. This sensitivity analysis showed that the long-term growth rate could reduce to nil without giving 
rise to an impairment of goodwill and that the discount rate could increase to 17.5% without giving rise to an impairment of goodwill. 
Neither of these changes in the key assumptions are expected to reasonably occur.
The carrying amount of goodwill has been allocated as follows: 
2010
£m
2009
£m
2008
£m
Goodwill by region
United Kingdom 8.1 8.1 8.7
Continental Europe 14.0 14.5 17.1
Rest of the world 4.3 3.9 5.4
26.4 26.5 31.2
15 Intangible assets 
Customer
relations
£m
Trade marks
£m
Software
£m
Total
£m
Carrying amount at 1 January 2010 2.8 0.5 0.2 3.5 
Foreign exchange – 0.1 – 0.1 
Gross carrying amount at 31 December 2010 2.8 0.6 0.2 3.6 
        
Amortisation
Carrying amount at 1 January 2010 0.5 0.2 0.1 0.8 
Charge for year 0.2 0.1 – 0.3 
Accumulated amortisation at 31 December 2010 0.7 0.3 0.1 1.1 
        
Net book value as at 31 December 2010 2.1 0.3 0.1 2.5
Net book value as at 31 December 2009: restated and disclosed 2.3 0.3 0.1 2.7
Net book value as at 31 December 2008: restated and disclosed 2.7 0.4 0.1 3.2
Notes to the Consolidated Financial Statements continued Empresaria Group plc 
Annual report and accounts 2010
55
Financials
16 Subsidiaries
A list of the significant investment in subsidiaries, including the name, country of incorporation and proportion of ownership interest 
is given in note 6 to the Company’s financial statements. 
17 Trade and other receivables
2010
£m
2009
£m
2008
£m
Current
Trade receivables 26.9 23.9 26.9 
Less provision for impairment of trade receivables (0.2) (0.7) (0.6)
Net trade receivables 26.7 23.2 26.3 
Loans to associates – – 0.8 
Prepayments and accrued income 1.9 2.5 3.3 
Other receivables 2.4 2.8 2.9 
31.0 28.5 33.3 
Trade receivables includes £0.8m (2009: £1.4m, 2008: £2.2m) on which security has been given as part of the invoice finance liability. 
All amounts are due within one year. The carrying value of trade receivables is considered to be a reasonable approximation  
of fair value. 
Further analysis on trade receivables is set out in note 22.
18 Trade and other payables
2010
£m
2009
£m
2008
£m
Current
Trade payables 2.2 1.8 1.8 
Other tax and social security 6.5 5.3 5.4 
Other payables 6.4 7.3 9.8 
Accruals 9.6 7.6 9.3 
Contingent consideration 0.3 0.3 0.1 
25.0 22.3 26.4 
All amounts are payable within one year. The fair values of trade and other payables are not materially different from those  
disclosed above.  Empresaria Group plc 
Annual report and accounts 2010
56
Financials
19 Financial liabilities 
a) Borrowings
2010
£m
2009
£m
2008
£m
Current
Bank overdrafts 3.8 2.1 2.6
Amounts related to invoice financing 0.8 1.4 2.2
Current portion of bank loans 8.1 0.8 0.6
12.7 4.3 5.4
Non-current
Bank loans 0.5 8.5 8.6
Other loan creditors – 0.1 0.8
0.5 8.6 9.4
Total financial liabilities 13.2 12.9 14.8
The bank loans include a revolving credit facility and two term loans which expire in 2011 and 2013. The bank loans are secured by a 
first fixed charge over all book and other debts given by the Company and certain of its subsidiaries. Interest rates vary over the term 
of the loan. In 2010, interest was payable at between 1.25% and 2.0% over base rate on the term loans, and between 1.75% and 2.5% 
over LIBOR on the revolving credit facility.
The interest rate on the bank overdrafts was fixed in 2010 at rates of 1.5% and 2.25% above base rate. 
The amounts above for invoice financing represent with-recourse facilities. The Group also has non-recourse invoice financing which 
is offset against trade receivables. The non-recourse invoice financing at 31 December 2010 was £8.5m (2009: £10.4m, 2008: £8.6m). 
b) Movement in net borrowings
2010
£m
2009
£m
2008
£m
As at 1 January (8.0) (9.1) (4.2)
Net increase/(decrease) in cash and cash equivalents 2.0 (0.5) 0.5 
(Increase)/decrease in loans (1.0) 1.6 (5.7)
Decrease in invoice financing 0.5 0.8 – 
On acquisition of business – (0.7) (0.2)
On disposal of business 0.3 – – 
Currency translation differences 0.1 (0.1) 0.5 
As at 31 December (6.1) (8.0) (9.1)
 
c) Analysis of net borrowings 
2010
£m
2009
£m
2008
£m
Financial liabilities – borrowings (13.2) (12.9) (14.8)
Cash and cash equivalents 7.1 4.9 5.7 
As at 31 December (6.1) (8.0) (9.1)
Cash and cash equivalents at 31 December 2010 include cash with banks of £0.3m (2009: £0.2m, 2008: £0.2m) held by a subsidiary 
which is subject to currency exchange restrictions.
Notes to the Consolidated Financial Statements continued Empresaria Group plc 
Annual report and accounts 2010
57
Financials
20 Deferred tax 
Tax losses
£000
Capital
allowances
£000
Holiday
pay
£000
Timing
differences
£000
Intangible
assets
£000
Total 
2010
£000
2009
£000
2008
£000
1 January 488 61 – – (562) (13) (106) 88
(Charge)/credit to income 277 (6) 81 47 (23) 376 93 (230)
Acquisition of business – – – – – – – 78 
Foreign exchange difference 63 – – – (26) 37 – (135)
31 December 828 55 81 47 (611) 400 (13) (106)
Analysis of deferred tax 
2010
£000
2009
£000
2008
£000
Deferred tax asset 1,011 549 524 
Deferred tax liability (611) (562) (630)
400 (13) (106)
At the balance sheet date, the Group has unused tax losses of £5.9m (2009: £4.8m) available for offset against future profits. A deferred 
tax asset has been recognised in respect of £2.9m (2009: £1.8m) of such losses. No deferred tax asset has been recognised in respect 
of the remaining £3.0m (2009: £3.0m) as it is not considered probable that there will be future taxable profits available.  
No deferred tax liability is recognised on temporary differences of £2.4m (2009: £2.0m) relating to the unremitted earnings of overseas 
subsidiaries as the Group is able to control the timing of the reversal of these temporary differences and it is probable that they will 
not reverse in the foreseeable future. 
21 Share capital
2010 2009 2008
Number of
shares £m
Number of
shares £m
Number of
shares £m
Authorised
Ordinary shares of 5p each 60,000,000 3.0 60,000,000 3.0 60,000,000 3.0
Allotted and fully paid
Ordinary shares of 5p each 44,562,847 2.2 44,562,847 2.2 34,066,356 1.7
22 Financial instruments 
The principal financial assets of the Group are cash and cash equivalents and trade and other receivables. The main purpose of these 
financial instruments is to raise finance for the Group’s operations. Its principal financial liabilities are trade and other creditors that 
arise directly from its operations, amounts owed to invoice discounters and bank loans.
Credit risk analysis
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the 
reporting date was:
Classes of financial assets – carrying amounts
2010
£m
2009
£m
Cash and cash equivalents 7.1 4.9
Trade and other receivables 31.0 28.5 Empresaria Group plc 
Annual report and accounts 2010
58
Financials
22 Financial instruments continued
The credit risk on liquid funds is limited because the third parties are banks with high credit ratings assigned by international  
credit-rating agencies.
The Group’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 likely reduction in the recoverability of the cash flows. The Group has no significant 
concentration of risk, with exposure spread over a large number of third parties and customers.
Debtors’ ageing and impairment losses
The age of trade receivables net of impaired debts as of reporting date is as follows:
2010
£m
2009
£m
0-30 days 17.0 13.6 
31-60 days 8.1 6.7
61-90 days 1.1 1.7 
Over 90 days 0.5 1.2 
Total trade receivables (note 15) 26.7 23.2 
Average debtor days during the year were 52 days (2009: 53 days).
All of the Group’s trade receivables have been reviewed for indications of impairment. Certain trade receivables were found to be 
impaired and a provision of £0.1m (2009: £0.3m) has been recorded accordingly. 
Included in the Group’s trade receivable balance are debtors with a carrying amount of £1.6m (2009: £2.9m) which are past due at the 
reporting date for which the Group has not provided as there has not been a significant change in credit quality and the amounts are 
still considered recoverable. The Group does not hold any collateral over these balances. 
  
The movement in the allowance for impairment in respect of trade receivables during the year was as follows: 
2010
£m
2009
£m
Balance as 1 January 0.7 0.6 
Impairment loss recognised 0.1 0.3 
Impairment loss utilised (0.6) (0.2)
Balance at 31 December 0.2 0.7 
Liquidity risk analysis
The Group’s funding strategy is to ensure a mix of financing methods offering flexibility and cost-effectiveness to match the 
requirements of the Group. The Group monitors its liquidity risk on an ongoing basis by undertaking cash flow forecasting 
procedures. In order to ensure continuity of funding, the Group seeks to arrange funding ahead of business requirements and 
maintain sufficient undrawn committed borrowing facilities.
As at 31 December 2010, Empresaria’s liabilities have contractual maturities which are summarised below: 
Current Non-current
within 6 months 6 to 12 months 1 to 5 years
Effective
interest rate
2010
£m
2009
£m
2010
£m
2009
£m
2010
£m
2009
£m
Long-term bank loans 2.8% 0.3 0.4 7.6 0.4 0.4 8.5
Other long-term creditors 4.0% – – – – – 0.3
Trade payables – 25.0 22.4 – – – –
Other short-term financial liabilities 4.3% 4.6 3.5 – – – –
Total 29.9 26.3 7.6 0.4 0.4 8.8
The above contractual maturities reflect the gross cash flows, which may differ to the carrying values of the liabilities at the balance 
sheet date.   
Notes to the Consolidated Financial Statements continued Empresaria Group plc 
Annual report and accounts 2010
59
Financials
22 Financial instruments continued
All bank loans are on floating interest rates.   
   
At the year end the Group had £4.2m (2009: £4.4m) of undrawn bank facilities.
There was no loan repayment default during the year (2009: nil). At the year end past due loans were nil (2009: nil).
Gearing ratio
2010
£m
2009
£m
Gross borrowings 13.2 12.9 
Less: cash and cash equivalents (7.1) (4.9)
Net debts 6.1 8.0 
Equity attributable to Company shareholders 25.6 24.2 
Net debt to equity ratio 23.8% 33.1%
   
Market risk analysis
The Group is exposed to market risk through its use of financial instruments and specifically to currency risk, interest rate risk and 
certain other price risks.
Capital risk
The Group manages its capital to ensure that entities in the Group will be able to continue as going concerns whilst maximising the 
return to stakeholders through the optimisation of the debt and equity balance. The capital structure of the Group consists of debt, 
which includes the borrowings disclosed in note 19, cash and cash equivalents disclosed in note 19 and equity attributable to equity 
holders of the parent, comprising issued capital, reserves and retained earnings as disclosed in note 21 and in the Consolidated 
statement of changes in equity.   
Foreign currency risk
Most of Empresaria Group plc’s transactions are carried out in pounds sterling. Most of the subsidiary companies’ transactions are 
carried out in the local currency of their respective countries. Exposures to currency exchange rates arising from overseas sales and 
purchases are minimal.
To mitigate the Group’s exposure to foreign currency risk, non-UK pound cash flows are monitored and forward exchange contracts 
are entered into in accordance with the Group’s risk management policies. Generally, Empresaria’s risk management procedures 
distinguish short-term foreign currency cash flows (due within 6 months) from longer-term cash flows. Where the amounts to be paid 
and received in a specific currency are expected to largely offset one another, no further hedging activity is undertaken. 
During the year ended 31 December 2010 no forward exchange contracts were entered into.
The carrying amounts of the Group’s significant foreign currency denominated monetary assets and monetary liabilities at the 
reporting date are as follows:
Assets Liabilities
2010
£m
2009
£m
2010
£m
2009
£m
Euro 19.8 18.5 17.2 16.4
Japanese Yen 2.8 2.2 2.1 1.2
Chilean Peso 4.0 4.2 2.1 2.0
Indonesian Rupiah 2.4 1.5 1.5 1.0 Empresaria Group plc 
Annual report and accounts 2010
60
Financials
22 Financial instruments continued
Sensitivity analysis
A 10% strengthening of pounds sterling against the following currencies would have (decreased)/increased equity and the income 
statement by the amounts shown below. The analysis assumes that all other variables, in particular interest rates, remain constant.  
2010 2009
Euro
£m
Japanese
Yen
£m
Chilean
Peso
£m
Indonesian
Rupiah
£m
Euro
£m
Japanese
Yen
£m
Chilean
Peso
£m
Indonesian
Rupiah
£m
Net result for the year (0.2) – – – 0.1 0.2 – –
Equity (1.8) (0.2) (0.3) (0.1) (1.8) (0.1) (0.3) –
Exposures to foreign exchange rates vary during the year depending on the volume of overseas transactions. Nonetheless, the 
analysis above is considered to be representative of Empresaria’s exposure to currency risk. 
Interest rate risk
The Group has interest-bearing assets and liabilities. Interest-bearing assets and liabilities include cash balances and overdrafts.
The Group manages its interest rate risk through a combination of cash pooling, shareholder funding and borrowing. Management 
monitors movements in interest rates to determine the most advantageous debt profile for the Group. At 31 December 2010, 
Empresaria is exposed to changes in market interest rates through its bank borrowings, which are subject to variable interest rates.  
For further information see note 19. All other financial assets and liabilities have fixed rates.
A change of 100 basis points in interest rates would have affected equity and the income statement by the amounts shown below.  
The analysis assumes that all other variables, in particular foreign currency rates, remain constant. 
Interest rate
2010
£m
2009
£m
Net result for the year 0.2 0.2
Equity 0.2 0.2
Fair value
The carrying value of all financial instruments equates to fair value.
The following table provides an analysis of financial instruments that are measured subject to initial recognition at fair value, grouped 
into level 2 based on the degree to which the fair value is observable:
Level 2: Call option and put option is measured from inputs other that quoted prices included within level 1 that are observable for the 
assets or liability, either directly or indirectly. 
2010
£m
2009
£m
Call option assets (level 2) 0.9 0.5 
Put option liability (level 2) (1.0) (0.9)
There were no transfers between level 1, 2 and 3 during the current or prior year.
There were no level 1 and level 3 financial instruments during the current or prior year.
Notes to the Consolidated Financial Statements continued Empresaria Group plc 
Annual report and accounts 2010
61
Financials
23 Financial commitments
Operating leases
Motor vehicles Land and buildings
2010
£m
2009
£m
2010
£m
2009
£m
Total minimum operating lease payments due:
Within one year 0.7 0.6 1.3 1.5
One to five years 1.0 0.8 1.3 1.6
After five years – – 0.1 0.1
1.7 1.4 2.7 3.2
24 Dividends
2010
£000
2009
£000
Amount recognised as distribution to equity holders in the period:
Final dividend for the year ended 31 December 2009 of 0.35p (2008: 0.35p) per share 156 153
Proposed final dividend for the year ended 31 December 2010 is 0.35p (2009: 0.35p) per share 156 156
The proposed dividend is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability 
in these financial statements. 
25 Contingent liabilities
Contingent consideration
Various contingent consideration payments have been deemed probable at 31 December 2010 totalling £0.3m (2009: £0.3m). As such, 
management has booked a liability for these liabilities. The fair value of contingent consideration is accrued once it is probable that all 
the conditions for payment will be met. 
Guarantees
Cross guarantees exist in respect of bank loans and overdrafts between all of the Group companies. Guarantees and contingencies 
exist in the ordinary course of business.
Headway penalty
As part of the acquisition of Headway in 2007, Empresaria Holding Deutschland GmbH (a subsidiary of the Company) signed  
a put and call option agreement in order to buy the residual shareholdings at a future date. Per the terms of this agreement, if certain 
call options are not exercised then a penalty will be due from Empresaria Holding Deutschland GmbH to the other shareholders. 
During 2008, one of the minority shareholders exited the business and thereby waived his rights to any future payment under the put 
and call option.
The discounted value of the penalty is €2.2m (2009: €2.1m). As at 31 December 2010, management assess that it is possible, but not 
probable, that a penalty may be payable under the terms of the put and call agreement. Therefore, no liability has been recognised for 
this amount. Empresaria Group plc 
Annual report and accounts 2010
62
Financials
25 Contingent liabilities continued
German legal issue
In December 2010 the German federal labour court ruled that the CGZP union is not entitled to conclude a collective labour agreement. 
This ruling was published on 25 February 2011. As a result the collective labour agreement concluded by CGZP is not valid at this 
time. In April 2011 the court in Berlin is expected to rule on whether this collective labour agreement can be declared invalid with 
retroactive effect. A number of operating companies within the Headway group applied this collective labour agreement until early 
or mid-2010. From January 2011 these operating companies have changed to BZA (the German Association of Private Employment 
Agencies) which has not been the subject of legal challenge. This change in pay structure for temporary workers is having a short-
term impact on gross margins.
These legal rulings could lead to claims from temporary employees as well as from the German government with regard to the 
payment of social security premiums. It is still not sufficiently clear at this time whether the invalidity of the collective labour 
agreement will have any retroactive consequences or what the possible amount of claims from third parties could be. For this reason 
no provision is being taken by the Group at this time for possible claims from third parties.
26 Profit of parent Company
As permitted by section 408 of the Companies Act 2006, the profit and loss account of the parent Company is not presented as part of 
these financial statements. The parent Company’s profit for the financial year was £0.5m (2009: loss of £0.8m). 
27 Related party transactions
Balances and transactions between the Company and its subsidiaries, which are related parties, have been eliminated on 
consolidation and are not disclosed in this note. These transactions include intra-Group management charges and net interest charges 
to subsidiaries, which amounted to £2.0m (2009: £1.9m) and £0.3m (2009: £0.4m), respectively.
Remuneration of key management personnel
The remuneration of Directors, who are the key management personnel of the Group, is set out below in aggregate for each of the 
categories specified in IAS 24. Further information about the remuneration of individual Directors is provided in the audited part of the 
Directors’ remuneration report on page 34.
2010
£m
2009
£m
Short-term employee benefits 0.6 0.5
There were no share based payments, long-term benefits or other benefits in the year.
Directors’ transactions
Dividends totalling £46,274 (2009: £46,239) were paid in the year in respect of ordinary shares held by the Company’s Directors.
Empresaria Group plc transacted with 24/7 Translations Limited for the provision of translation services. Spencer Wreford, Group 
Finance Director, jointly owns this company with his wife. In total the services charged were for £700.
Notes to the Consolidated Financial Statements continued Empresaria Group plc 
Annual report and accounts 2010
63
Financials
28 Prior year restatement
Following a review of the Group’s accounting for the put and call arrangement relating to the Headway acquisition the accounting for 
the option arrangement has been amended with a restatement of the prior year amounts. Under the revised accounting treatment the 
Group has recognised a put option liability arising from the put options held by minority shareholders over the shares in subsidiary 
companies. The amount of this liability is reviewed at each period end and adjusted to reflect the amount that is considered will 
become payable to the minority shareholders based on the terms of the put option. The debit arising from the initial recognition of 
the put option liability has been taken to reserves with the subsequent movement in the liability being recognised in finance income/
(expense). The put option liability has not been discounted as any adjustment to the liability would not be material. Under the revised 
accounting the Group has also recognised the fair value of the call option asset, being the fair value of the call option held by the 
Group over shares held by minority interest shareholders. The fair value has been established based on the terms of the call option 
using a Black Scholes option pricing model. The credit arising from the initial recognition of the call option asset has been taken to 
reserves with the subsequent movement in the fair value of the asset being recognised in finance income/(expense).
The impact of the restatement as of the following dates and for the financial periods ended on those dates is summarised below.
31 December 2008
Finance
income
Finance
 cost
Call option
asset
Put option
(liability)
Option
reserve
Retained
earnings
As disclosed £m (0.3) 1.3 – – – (3.4)
Adjustment £m – – 0.8 (1.4) 0.6 –
Restated £m (0.3) 1.3 0.8 (1.4) 0.6 (3.4)
31 December 2009
Finance
income
Finance
 cost
Call option
asset
Put option
(liability)
Option
reserve
Retained
earnings
As disclosed £m (0.2) 1.0 – – – 1.8 
Adjustment £m (0.5) 0.2 0.5 (0.9) 0.6 (0.3)
Restated £m (0.7) 1.2 0.5 (0.9) 0.6 1.5
     
The impact of the restatement on earnings/(loss) per share is as below: 
31 December 2009
Continuing
operations
Continuing
and
discontinued
operations
Basic and diluted 
As disclosed (pence) (8.4) (12.4)
Adjustment (pence) 0.8 0.8
Restated (pence) (7.6) (11.6)
There was no impact of the above changes on the consolidated cash flow statement. Empresaria Group plc 
Annual report and accounts 2010
64
Financials
Independent Auditors’ Report to the members  
of Empresaria Group plc
We have audited the parent Company financial statements of 
Empresaria Group plc for the year ended 31 December 2010 
which comprise Parent Company Balance Sheet and the related 
notes 1 to 12. The financial reporting framework that has 
been applied in their preparation is applicable law and United 
Kingdom Accounting Standards (United Kingdom Generally 
Accepted Accounting Practice).
 
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. 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 Statement of Directors’ 
responsibilities, the Directors are responsible for the preparation 
of the parent Company 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 parent Company 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 Ethical 
Standards for Auditors.
 
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts 
and disclosures in the financial statements sufficient to give 
reasonable assurance that the financial statements are free  
from material misstatement, whether caused by fraud or error. 
This includes an assessment of: whether the accounting 
policies are appropriate to the parent Company’s circumstances 
and have been consistently applied and adequately disclosed; 
the reasonableness of significant accounting estimates made 
by the Directors; and the overall presentation of the financial 
statements. In addition, we read all the financial and non-
financial information in the annual report to identify material 
inconsistencies with the audited financial statements. If  
we become aware of any apparent material misstatements  
or inconsistencies we consider the implications for our report.
Opinion on financial statements
In our opinion the parent Company financial statements: give 
a true and fair view of the state of the Company’s affairs as at 
31 December 2010 and of its profit for the year then ended; have 
been properly prepared in accordance with United Kingdom 
Generally Accepted Accounting Practice; and have been prepared 
in accordance with the requirements of the Companies Act 2006.
 
Opinion on other matter 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 parent Company financial statements.
 
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters 
where the Companies Act 2006 requires us 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.
 
Other matter
We have reported separately on the Group financial statements of 
Empresaria Group plc for the year ended 31 December 2010.
 
Ian Smith (Senior statutory auditor)
for and on behalf of Deloitte LLP
Chartered Accountants and Statutory Auditors
Crawley, United Kingdom
30 March 2011 Empresaria Group plc 
Annual report and accounts 2010
65
Financials
Parent Company Balance Sheet
Note
2010
£m
2009
£m
Restated
Fixed assets
Tangible assets 5 0.2 0.2 
Investments 6 29.2 28.3 
Call option asset 12 0.9 0.5 
30.3 29.0 
Current assets
Debtors (including amounts falling due after more than one year of £2.4m (2009: £5.1m) 7 17.7 15.5 
Cash at bank 0.1 0.7
Creditors: amounts falling due within one year 8 (18.8) (8.2)
Net current assets (1.0) 8.0
Total assets less current liabilities 29.3 37.0 
Creditors: amounts falling due after more than one year 9 (3.9) (11.8)
Put option liability 12 (0.1) (0.3)
Net assets 25.3 24.9 
Capital and reserves
Called up share capital 10,11 2.2 2.2 
Share premium account 10 19.4 19.4 
Other reserves 10 1.5 1.5 
Option reserves 10 0.4 0.4 
Profit and loss account 10 1.8 1.4 
Shareholders’ funds 10 25.3 24.9 
These financial statements of Empresaria Group plc (Company registration number 03743194) were approved by the board of 
Directors and authorised for issue on 30 March 2011. 
Signed on behalf of the board of Directors
Miles Hunt Spencer Wreford
Director Director
   
    
Financials Empresaria Group plc 
Annual report and accounts 2010
66
Financials
Notes to the parent Company financial statements
1 Basis of preparation and significant accounting policies
The financial statements are for the twelve months ended 31 
December 2010. They have been prepared in accordance with  
applicable United Kingdom accounting standards. The financial 
statements have been prepared under the historical cost 
convention. 
These financial statements are presented in Pounds Sterling (£), 
which is also the functional currency of the parent Company.
The accounting policies have been applied consistently 
throughout the period for the purposes of preparation of these  
financial statements. 
Going concern
Details of going concern are given in note 1 to the Group 
accounts.
Foreign currencies
(i) Monetary assets and liabilities 
Monetary assets and liabilities in foreign currencies are 
translated into sterling at the rates ruling at the year end. 
Exchange rate differences are dealt with through the profit and 
loss account.
(ii) Hedges of net investments in foreign operations
Any gain or loss on the hedging instrument relating to the 
effective portion of net investment hedge is recognised in equity 
in the foreign currency translation reserve. The gain or loss 
relating to the ineffective portion is recognised immediately in the 
profit and loss. Gain and losses deferred in the foreign currency 
translation reserve are reclassified to profit or loss on disposal of 
the foreign operation.
Tangible fixed assets
Depreciation is provided on cost in equal annual instalments over 
the estimated useful lives of the assets. The rates of depreciation  
are as follows:
Fixtures, fittings and equipment: between one and five years.
Investments
Investments held as fixed assets are stated at cost less provision 
for any impairment in value.
Fixed asset investments
The Company’s investments in shares in Group companies are 
stated at cost less provisions for impairment. Any impairment is 
charged to the income statement as it arises.
Leases 
Assets obtained under finance leases and hire purchase contracts 
are capitalised at their fair value on acquisition and depreciated 
over their estimated useful lives. The finance charges are 
allocated over the period of the lease in proportion to the capital 
element outstanding.
Operating lease rentals are charged to income in equal annual 
amounts over the lease term. 
Pension costs
Pension costs are charged to the profit and loss account and 
solely relate to contributions made to staff personal pension 
schemes. Contributions to the scheme are charged to the income 
statement as they become due for payment. 
Equity instruments
Equity instruments issued by the Company are recorded at the 
proceeds received, net of direct issue costs. 
2 Profit for the year
As permitted by section 408 of the Companies Act 2006 the 
Company has elected not to present its own profit and loss 
account for the year. The Company reported a profit after 
tax for the financial year ended 31 December 2010 of £0.5m 
(2009: £0.8m). Empresaria Group plc 
Annual report and accounts 2010
67
Financials
3 Directors and employees
2010
£m
2009
£m
Staff costs 
Wages and salaries 1.2 0.9
Social security costs 0.1 0.1
– –
1.3 1.0
2010
Number
2009
Number
Average monthly number of persons employed (including Directors) 11 11
Pension contributions made in the year were £30,294 (2009: £37,170).
Details of Directors’ remuneration are given in note 8 to the Group accounts.
4 Dividends
During 2010 Empresaria Group plc paid a dividend of £0.2m to its equity shareholders (2009: £0.2m). This amounted to 0.35p per 
ordinary share (2009: 0.35p).
A final dividend is proposed for the year ended 31 December 2010 of 0.35p per ordinary share (2009: 0.35p). The proposed dividend 
is subject to approval by shareholders at the Annual General Meeting and has not been included as a liability in these financial 
statements. If approved, the dividend will be paid on 15 August 2011 to members registered on 15 July 2011.
5 Property, plant and equipment
The following table shows the significant additions and disposals of property, plant and equipment.
Cost
Fixtures, 
fittings and 
equipment
£m
At 1 January 2010 0.4
Additions 0.1
Disposals (0.1)
At 31 December 2010 0.4
Accumulated depreciation
At 1 January 2010 0.2
Charge for the year 0.1
Disposals (0.1)
At 31 December 2010 0.2
Net book value
At 31 December 2010 0.2
At 31 December 2009 0.2 Empresaria Group plc 
Annual report and accounts 2010
68
Financials
6 Investments held as fixed assets 
Loans to 
subsidiary
 undertakings
£m
Shares in 
subsidiary
undertakings
£m
Total
£m
Cost
At 1 January 2010 6.8 26.2 33.0
Additions – 2.1 2.1
At 31 December 2010 6.8 28.3 35.1
Impairment
At 1 January 2010 – 4.7 4.7
Impairment charge – 1.2 1.2
Foreign exchange movements – – –
At 31 December 2010 – 5.9 5.9
Net book value
As 31 December 2010 6.8 22.4 29.2
At 31 December 2009 6.8 21.5 28.3
The exchange movement in the loans to subsidary undertakings is recognised in other reserves as the receivable is treated as a net 
investment in foreign operations.
Investments comprise of the following principal subsidiary companies:
Company Class of share held %
Country 
of
Incorporation
Bar 2 Limited* “A & B” Ordinary 71 UK
FastTrack Management Services (London) Limited* “A” Ordinary 94 UK
Greycoat Placements Limited* Ordinary 100 UK
LMA Recruitment Limited* “A” Ordinary 63 UK
McCall Limited* “A & B” Ordinary 79 UK
The Logistics Network Limited* “A & B” Ordinary 65 UK
The Recruitment Business Limited* “A” Ordinary 79 UK
Headway Holding GmbH Ordinary 80 Germany
Interactive Manpower Solutions Private Limited* Equity Share 76 India
Mediradix Oy* Ordinary 60 Finland
Learning Resources Shares 51 Indonesia
Marketing y Promociones S.A. ‘Alternattiva’ Common 56 Chile
Monroe Consulting Group Shares 55 Indonesia
Skillhouse Staffing Solutions K.K. Ordinary 75 Japan
The Recruitment Business Pty Limited Ordinary 100 Australia
* These companies are directly held by Empresaria Group plc. The remaining investments are indirectly held. 
   
The nature of each investment is the provision of staffing services and each entity operates in its country of incorporation. 
Notes to the parent Company financial statements continued Empresaria Group plc 
Annual report and accounts 2010
69
Financials
7 Debtors
2010
£m
2009
£m
Amounts owed by Group undertakings (including amounts falling due  
after more than one year of £2.4m (2009: £5.1m) 16.0 13.8
Other debtors 1.2 1.1
Prepayments and accrued income 0.5 0.6
17.7 15.5
8 Creditors: amounts falling due within one year
2010
£m
2009
£m
Bank overdraft and loans due within one year 16.8 7.7
Trade creditors 0.1 0.1
Amounts owed to subsidiary undertakings 1.0 –
Deferred consideration and other creditors 0.2 –
Accruals 0.7 0.4
18.8 8.2
Other creditors include a finance lease of £25,851 (2009: £45,433).
9 Creditors: amounts falling due after more than one year
2010
£m
2009
£m
Loan from subsidiary undertakings 3.6 3.5
Bank loans 0.3  8.3 
3.9  11.8 
     
The bank loans include a revolving credit facility and two term loans which expire in 2011 and 2013 respectively. The bank loans are 
secured by a first fixed charge over all book and other debts given by the Company and certain subsidiaries. Interest rates vary over 
the term of the loan. In 2010, interest was payable at between 1.75% and 2.25% over base rate on the term loans, and between 1.75% 
and 2.50% over LIBOR on the revolving credit facility.     
2010
£m
2009
£m
Bank loan
Repayable within one year 8.0 0.8
Repayable between one and two years 0.2 0.5
Repayable between two and five years 0.1 7.8
8.3 9.1 Empresaria Group plc 
Annual report and accounts 2010
70
Financials
10 Reconciliation of movements in shareholders’ funds
2010
Share capital
£m
2010
Share
premium
£m
2010
Other
reserve
£m
2010
Option
reserves
£m
2010
Profit and
loss account
£m
2010
Total
Shareholders’
funds
£m
2009
Total
Shareholders’
funds
£m
Restated 
Profit/loss for the financial year – – – – 0.5 0.5 0.8 
Dividend paid – – – – (0.2) (0.2) (0.2)
Foreign exchange to equity – – – – – – (0.2)
Recognising option value in equity – – – – – – – 
Net proceeds from issue of shares – – – – – – 2.9 
Net addition to shareholders’ funds – – – – 0.3 0.3 3.3 
Opening shareholders’ funds (restated) 2.2 19.4 1.5 0.4 1.4 24.9 21.6 
Closing shareholders’ funds 2.2 19.4 1.5 0.4 1.8 25.3 24.9 
Profit for the year after tax was £533,000 (2009: £770,000).
11 Called up share capital
2010
Number of
shares £m
2009
Number of
shares £m
Authorised
Ordinary shares of 5p each 60,000,000 3.0 60,000,000 3.0
Allotted and fully paid
Ordinary shares of 5p each 44,562,847 2.2 44,562,847 2.2 
The Company has one class of ordinary share which carries no rights to fixed income. All ordinary shares are entitled to receive 
dividends as declared from time to time and are entitled to one vote per share at meetings of the Company. All shares rank equally 
with regard to the Company’s residual assets.
During the year ended 31 December 2010 no ordinary shares were issued (2009: 10,496,491 for a premium of £2.4m). 
Notes to the parent Company financial statements continued Empresaria Group plc 
Annual report and accounts 2010
71
Financials
12 Prior year restatement
Following a review of the Company’s accounting for the put and call arrangement relating to the Headway acquisition the accounting 
for the option arrangement has been amended with a restatement of the prior year amounts. Under the revised accounting treatment 
the Company has recognised a put option liability arising from the put options held by minority shareholders over the shares in 
subsidiary companies. The amount of this liability is reviewed at each period end and adjusted to reflect the amount that is considered 
will become payable to the minority shareholders based on the terms of the put option. The debit arising from the initial recognition of 
the put option liability has been taken to reserves with the subsequent movement in the liability being recognised in finance income/
(expense). The put option liability has not been discounted as any adjustment to the liability would not be material. Under the revised 
accounting the Company has also recognised the fair value of the call option asset, being the fair value of the call option held by the 
Company over shares held by minority interest shareholders. The fair value has been established based on the terms of the options 
using a Black Scholes option pricing model. The credit arising from the initial recognition of the call option asset has been taken to 
reserves with the subsequent movement in the fair value of the asset being recognised in finance income/(expense). 
The impact of the restatement as of the following dates and for the financial periods ended on those dates is summarised below.
31 December 2008
Call option
asset
Put option
liability
Option
 reserve
Retained
earnings
As disclosed £m – – – 0.8 
Adjustment £m 0.8 (0.4) (0.4) –
Restated £m 0.8 (0.4) (0.4) 0.8 
     
31 December 2009
Call option
asset
Put option
liability
Option
 reserve
Retained
earnings
As disclosed £m – – – 1.6 
Adjustment £m 0.5 (0.3) (0.4) (0.2)
Restated £m 0.5 (0.3) (0.4) 1.4  Empresaria Group plc 
Annual report and accounts 2010
72
Officers and professional advisers
Directors
Miles Hunt, Chief Executive 
Spencer Wreford, Group Finance Director 
Tony Martin, Chairman
Penny Freer, Non-executive Director
Zach Miles, Non-executive director
Company Secretary
Anne-Marie Clarke
Registered address
Old Church House
Sandy Lane
Crawley Down
Crawley
West Sussex
RH10 4HS
Company registration number
03743194
NOMAD (financial advisers and brokers)
Altium Capital Limited
30 St James’s Square
London
SW1Y 4AL
Solicitors
Osborne Clarke 
2 Temple Back East 
Temple Quay 
Bristol 
BS1 6EG
Bankers
HSBC Bank plc 
West & Wales Corporate Banking 
3 Rivergate 
Temple Quay 
Bristol 
BS1 6ER
Auditors
Deloitte LLP 
London Gatwick Office 
Global House 
High Street 
Crawley 
West Sussex 
RH10 1DL 
Registrars
Capita Registrars 
Northern House 
Woodsome Park 
Fenay Bridge 
Huddersfield 
West Yorkshire 
HD8 0GA Empresaria is an international specialist 
staffing Group. Our companies, each 
specialising in specific markets or services, 
operate across the world with representation 
in 18 countries through over 100 offices.  
Our service capabilities include temporary 
and permanent recruitment, Recruitment 
Process Outsourcing, HR consulting and 
corporate training.
The strategy of the Group is to develop a diversified business 
across sectors and geographies, with a focus on high-growth 
markets. The Group operates through sector-specific brands, 
with each brand positioned and developed to be a specialist 
in its own field. 
The Group applies a philosophy of management equity to align  
the interests of shareholders and Group management teams 
through the sharing of risk and reward by way of equity 
participation. Group structure is decentralised with local 
management retaining operational autonomy and responsibility 
and with central functions focussing on financial planning and 
control, Group development and administration.
Contents 
Overview
01 Highlights
02 At a glance
04 Chairman’ s statement
 
Business review
06 Chief Executive’ s business review
08 Strategy to achieve objectives
10 Regional review
16 Key performance indicators
18 Finance review
22 Corporate social responsibility
 
Governance
24 Board of Directors
26 Directors’ report
28  Statement of Directors’ responsibilities
29 Corporate governance statement
31 Audit committee report
33 Directors’ remuneration report
35  Independent auditor’s report to the members 
of Empresaria Group plc
 
Financials
36 Consolidated Income Statement
37  Consolidated Statement of Comprehensive 
Income
38 Consolidated Balance Sheet
39  Consolidated Statement of Changes in Equity
40 Consolidated Cash Flow Statement
41  Notes to the Consolidated Financial 
Statements
64  Independent Auditors’ Report to the members 
of Empresaria Group plc
65 Parent Company Balance Sheet
66  Notes to the parent Company financial 
statements 
72 Officers and professional advisers
2 0 1 0* * 2009** 2008 2007 2006
Revenue (£m) 2 2 3 .4 190.5 207.7 147.8 75.5
Gross profit (£m) 4 9.0 40.6 51.5 42.4 21.8
Profit/(loss) before tax (£m) 6.7 (1.5) 1.3 6.0 2.9
Adjusted profit before tax (£m)* 6 .8 3.5 6.4 6.2 2.9
Operating profit/(loss) (£m) 7.5 (1.0) 2.4 6.7 3.5
Adjusted operating profit (£m)* 7.8 4.3 7.5 6.9 3.5
Earnings/(loss) per share (pence) 7.0 (11.6) (4.8) 8.4 6.7
Adjusted earnings per share (pence)* 6. 2 3.1 8.6 9.2 7.2
Proposed dividend per share (pence) 0. 35 0.35 0.35 0.55 0.5
*  Figures based on underlying profits excluding amortisation of intangible assets, 
movements on put and call options and any exceptional items. See reconciliation in note 11.
**  The figures for 2010 and 2009 exclude the results from discontinued operations  
(see note 6 for details).
The figures for 2009 have been restated. See note 28 for details.
Overview of performance
This report has been printed to environmental 
management system ISO 14001 standards by 
a printer which is Forest Stewardship Council 
(FSC) chain of custody-certified. All inks used are 
vegetable-based. This paper is environmentally 
friendly ECF (elemental chlorine-free) and wood-free 
with a great proportion of the raw material used being 
the by-product from other production processes i.e. 
saw mill waste and waste which results from forest 
thinning. The mill is fully FSC-certified. The paper 
is also completely bio-degradable and recyclable.
 
Designed and produced by The College 
www.thecollege.uk.com
TT-COC-002228 Resilience 
Performance 
Growth 
Empresaria Group plc
Annual report and accounts 2010
Empresaria Group plc
Old Church House
Sandy Lane
Crawley Down
Crawley
West Sussex
RH10 4HS
Tel: +44 (0) 1342 711 430
Fax: +44 (0) 1342 711 449
Email: info@empresaria.com
w w w .em p resaria.co m
Empresaria Group plc Annual report and accounts 2010