Advanced Medical Solutions Group plc
Annual Report and Accounts 2010
Advanced Medical Solutions Group plc Annual Report and Accounts 2010
Registered Office:
Premier Park, 33 Road One
WInsford Industrial Estate
Winsford, Cheshire, CW7 3RT
Company Number: 2867684
Tel: +44 (0)1606 863500
Fax: +44 (0)1606 863600
e-mail: info@admedsol.com
Web: www.admedsol.com
is a global business providing 
innovative products and brands in 
the areas of accelerating healing 
and managing wounds, minimising 
adverse surgical outcomes and 
sealing and closing tissue.
•Applied Innovation
•Manufacture
•Supply
Advanced Medical Solutions Group 
 1 Highlights
 2 Overview
10 Business Review: Strategic Overview
12 Business Review: Chairman’s Statement
14 Business Review: Chief Executive Officer’s Report
17 Business Review: Group Finance Director’s Report
20 Directors
22 Management Team
24 Corporate Governance Standing Committees
25 Report of the Directors
29 Remuneration Report
32 Corporate Governance
35  Independent Auditor’s Report to the members of 
Advanced Medical Solutions Group plc
36 Consolidated Income Statement
36 Consolidated Statement of Comprehensive Income
37 Consolidated Statement of Financial Position 
38 Consolidated Statement of Changes in Equity
39 Consolidated Statement of Cash Flows
40  Notes Forming Part of the Consolidated  
Financial Statements
67 Company Balance Sheet
68 Notes to the Company Financial Statements
71 Five Year Summary
72 Advisors
73 Notice of Meeting Advanced Medical Solutions Group plc
Annual Report and Accounts 2010
Advanced Medical Solutions Group plc Annual Report and Accounts 2010
Registered Office:
Premier Park, 33 Road One
WInsford Industrial Estate
Winsford, Cheshire, CW7 3RT
Company Number: 2867684
Tel: +44 (0)1606 863500
Fax: +44 (0)1606 863600
e-mail: info@admedsol.com
Web: www.admedsol.com
is a global business providing 
innovative products and brands in 
the areas of accelerating healing 
and managing wounds, minimising 
adverse surgical outcomes and 
sealing and closing tissue.
•Applied Innovation
•Manufacture
•Supply
Advanced Medical Solutions Group 
 1 Highlights
 2 Overview
10 Business Review: Strategic Overview
12 Business Review: Chairman’s Statement
14 Business Review: Chief Executive Officer’s Report
17 Business Review: Group Finance Director’s Report
20 Directors
22 Management Team
24 Corporate Governance Standing Committees
25 Report of the Directors
29 Remuneration Report
32 Corporate Governance
35  Independent Auditor’s Report to the members of 
Advanced Medical Solutions Group plc
36 Consolidated Income Statement
36 Consolidated Statement of Comprehensive Income
37 Consolidated Statement of Financial Position 
38 Consolidated Statement of Changes in Equity
39 Consolidated Statement of Cash Flows
40  Notes Forming Part of the Consolidated  
Financial Statements
67 Company Balance Sheet
68 Notes to the Company Financial Statements
71 Five Year Summary
72 Advisors
73 Notice of Meeting 0
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Feb-11 Aug-10 Feb-10 Aug-09 Feb-09 Aug-08 Feb-08 Aug-07 Feb-07 Aug-06 Feb-06
Advanced Medical Solutions 
FTSE All Share 
FTSE Techmark All Share 
FTSE ALL Share Healthcare 
FTSE Small Cap  
FTSE AIM All Share
 
 UK £8.3m
 Europe £13.8m
 USA £9.2m
ROW £0.6m
Sales by Geographic Sector
 Woundcare
£25.2m
Wound closure
and sealants
£6.7m
Sales by Market Sector
 
 UK £8.3m
 Europe £13.8m
 USA £9.2m
ROW £0.6m
Sales by Geographic Sector
 Woundcare
£25.2m
Wound closure
and sealants
£6.7m
Sales by Market Sector
new world class facility 
in Winsford, Cheshire
138,500sq ft
>  Accelerating healing 
and managing wounds
>  Minimising adverse 
surgical outcomes
>  Sealing and closing  
tissue
With our broad range of applications 
and multiple technology platforms, 
AMS has created a unique 
market position.
We develop, manufacture and market 
innovative products in the areas of:
Advanced Medical Solutions Group at a glance
258 
Employees
Five Year Relative Share Price Performance Sales by Geographic Sector
Sales by Market Sector 0
200
400
600
800
1000
Feb-11 Aug-10 Feb-10 Aug-09 Feb-09 Aug-08 Feb-08 Aug-07 Feb-07 Aug-06 Feb-06
Advanced Medical Solutions 
FTSE All Share 
FTSE Techmark All Share 
FTSE ALL Share Healthcare 
FTSE Small Cap  
FTSE AIM All Share
 
 UK £8.3m
 Europe £13.8m
 USA £9.2m
ROW £0.6m
Sales by Geographic Sector
 Woundcare
£25.2m
Wound closure
and sealants
£6.7m
Sales by Market Sector
 
 UK £8.3m
 Europe £13.8m
 USA £9.2m
ROW £0.6m
Sales by Geographic Sector
 Woundcare
£25.2m
Wound closure
and sealants
£6.7m
Sales by Market Sector
new world class facility 
in Winsford, Cheshire
138,500sq ft
>  Accelerating healing 
and managing wounds
>  Minimising adverse 
surgical outcomes
>  Sealing and closing  
tissue
With our broad range of applications 
and multiple technology platforms, 
AMS has created a unique 
market position.
We develop, manufacture and market 
innovative products in the areas of:
Advanced Medical Solutions Group at a glance
258 
Employees
Five Year Relative Share Price Performance Sales by Geographic Sector
Sales by Market Sector 1 Advanced Medical Solutions Group plc Annual Report 2010  
2 0 0 9 2 0 1 0 2 0 0 8
£ 2 . 9 m
£ 4 . 1 m
2 0 0 9 2 0 1 0 2 0 0 8
£ 3 1 . 9 m
£ 2 0 . 3 m
£ 2 4 . 1 m
2 0 0 9 2 0 1 0 2 0 0 8
£5 . 3 m
£ 2 . 7 m
£ 4 . 1 m
2 0 0 9 2 0 1 0 2 0 0 8
2 . 3 1 p
3. 0 9 p
£5 . 3 m
3 . 8 3 p
2 0 0 9 2 0 1 0 2 0 0 8
£ 2 . 9 m
£ 4 . 1 m
2 0 0 9 2 0 1 0 2 0 0 8
£ 3 1 . 9 m
£ 2 0 . 3 m
£ 2 4 . 1 m
2 0 0 9 2 0 1 0 2 0 0 8
£5 . 3 m
£ 2 . 7 m
£ 4 . 1 m
2 0 0 9 2 0 1 0 2 0 0 8
2 . 3 1 p
3. 0 9 p
£5 . 3 m
3 . 8 3 p
2 0 0 9 2 0 1 0 2 0 0 8
£ 7.3 m
£ 1.7 m
2 0 0 9 2 0 1 0 2 0 0 8
£ 3 1 . 9 m
£ 2 0 . 3 m
£ 2 4 . 1 m
2 0 0 9 2 0 1 0 2 0 0 8
£5 . 3 m
£ 2 . 7 m
£ 4 . 1 m
2 0 0 9 2 0 1 0 2 0 0 8
2 . 3 1 p
3. 0 9 p
£3.9 m
3 . 8 3 p
2 0 0 9 2 0 1 0 2 0 0 8
£ 2 . 9 m
£ 4 . 1 m
2 0 0 9 2 0 1 0 2 0 0 8
£ 3 1 . 9 m
£ 2 0 . 3 m
£ 2 4 . 1 m
2 0 0 9 2 0 1 0 2 0 0 8
£5 . 3 m
£ 2 . 7 m
£ 4 . 1 m
2 0 0 9 2 0 1 0 2 0 0 8
2 . 3 1 p
3. 0 9 p
£5 . 3 m
3 . 8 3 p
Business Highlights
> Successful US LiquiBand® launch exceeding first full 
year expectations 
> New facility in Winsford now fully operational, 
positioning the Group for strong growth
> Integration of foam business delivering strong 
performance from new technology
> ActivHeal® range continuing to gain ground 
following successful rebranding
> Silver alginate continuing to gain market share
Financial Highlights
> Revenue increased by 32% to £31.9 million  
(2009: £24.1 million) at actual and constant 
currency
1
> Profit from operations (pre-exceptional items
2
) up 
31% to £5.3 million (2009: £4.1 million)  
Profit from operations (post-exceptional items
2
) up 81% to £4.3 
million (2009: £2.4 million)
> Basic earnings per share (pre-exceptional items
2
) up 
24% to 3.83p (2009: 3.09p)
 Basic earnings per share (post-exceptional items
2
) 
increased 64% to 3.17p (2009: 1.93p)
> Strong cash generation in second half of year - net 
funds
3
 of £3.9 million at 31 December 2010  
(2009: £1.7 million) 
> Maiden final dividend proposed at 0.38p per share
1.  Constant currency removes the effect of currency movements by re-translating the current 
year’s performance at the previous year’s exchange rates
2.  Exceptional costs of £1.0 million were incurred on the new Winsford facility  
(2009: Exceptional costs of £0.8 million were incurred on an aborted acquisition and  
£0.9 million related to the Winsford facility)
3.  Net funds is defined as cash and cash equivalents plus short term investments less 
financial liabilities
Net funds
3
£3.9m at 31 December 2010
Group revenue
up 32% at £31.9m
Profit from operations
(pre-exceptional items
2
)
up 31% at £5.3m
Basic earnings per share
(pre-exceptional items
2
)
up 24% at 3.83p 2  Advanced Medical Solutions Group plc Annual Report 2010
A
Accelerating healing and managing wounds  
Silver alginate
Silver is widely recognised as a safe and effective broad 
spectrum anti-microbial agent for infection control. We have 
developed a range of wound dressings that incorporate silver 
into our proprietary calcium alginate technology. These 
dressings are suitable for moderate to heavily exuding 
infected wounds. Ongoing technical and clinical support for 
our silver alginate product range has continued to drive 
growth in our silver dressings business and has helped our 
partners capture a 20% global market share in just  
five years, second only to the dominant leader.
Foam
In October 2009 we strengthened our position in hydrophilic 
polyurethane foam, by acquiring the Corpura B.V. business 
based in The Netherlands. In 2010, we saw the first full year 
contribution from this business. Foam is one of the fastest 
growing segments of the advanced woundcare sector and 
provides an ideal platform for delivering actives and  
anti-microbials to help accelerate wound healing. Foam 
revenues have benefited from a number of product  
launches with key partners. 3 Advanced Medical Solutions Group plc Annual Report 2010  
 
ActivHeal® 
ActivHeal® is a cost-effective range of 
products supplied directly to the NHS 
as first-line therapy for routine wounds, 
generating significant cost savings and 
equivalent clinical performance over 
branded equivalents.
Our compelling 
proposition has  
increased sales by 21% 
as the NHS
 
responds to 
budgetary pressure.
Following a relaunch of the product range, 
in new, distinctive and easily recognisable 
packaging, ActivHeal® is a product of first 
choice when it comes to cost-effective 
dressing of non-infected wounds.
Advanced woundcare market
Sizes and growth rates 
(exclude negative pressure wound therapy)
> Advanced woundcare $3750m +4%
> Global fibre market $370m +5%
> Global foam market $1000m +12%
> NHS £120m +2%
Market size and growth rate
ActivHeal® 4  Advanced Medical Solutions Group plc Annual Report 2010
M
Minimising adverse surgical outcomes
LiquiBand® Surgical
‘close and protect’ tissue sealant
Approval has been received to market our LiquiBand® Surgical 
‘close and protect’ tissue adhesive in the US. We are working 
with key surgeons to design the ideal delivery system for this 
surgical device. We now have a product range that covers 100% 
of the target, topical tissue adhesive market in the US.
Surgical sealants
Our clinically proven range of surgical sealants are an essential 
tool in the fight to reduce surgical site infections. Prepping  
and draping are an important part of any pre-op routine but  
do not completely sterilise a patient’s skin. Our range of 
surgical sealants are proven to seal and immobilise the 
bacteria that survive the patient prep, preventing them from 
contaminating the surgical incision site. Finding the right 
partners to successfully access the Operating Room is a focus 
for the management team. 
Internal fixation device
Progress continues to be made in the development of an 
implantable adhesive device for the internal fixation of materials, 
such as hernia meshes, via minimally invasive surgery. Successful 
completion of this project will allow entry of our tissue adhesive 
range into the high-value internal sealants market, currently 
estimated to be valued around $600m per year. 
  5 Advanced Medical Solutions Group plc Annual Report 2010  
M 6  Advanced Medical Solutions Group plc Annual Report 2010
S
Sealing and closing tissue 
Progress has been excellent in our first 12 months of 
promotional activity. A high number of clinical evaluations 
took place in 2010, with hospitals trying the product for the 
first time. We are pleased with both the outcome of the 
evaluations and the speed with which hospitals are 
converting to regular usage.
We have four distribution partners promoting LiquiBand® 
including Cardinal Health, which has a substantial sales force 
targeting the Acute Care segment (80% of the US tissue 
adhesives market), and the largest US pharmaceutical 
distributor targeting the Alternate Site segment (the other 
20% of the market). We are well placed to challenge the 
dominant market leader.
With the approval of LiquiBand® Surgical ‘close and protect’ 
tissue sealant received for the US, we now have a full range of 
products that address the total tissue adhesive market.
The launch of LiquiBand® into the key 
$220 million US market has been a 
pivotal milestone for the Group 7 Advanced Medical Solutions Group plc Annual Report 2010  
S
Wound closure and sealants market
Sizes and growth rates
> US $220m +8%
> UK £8m +3% (including Operating Room) 
> Europe £15m +5%
> ROW £5m +7%
Market size and growth rate
LiquiBand®
A range of LiquiBand® products has 
been developed to address the $250m 
global topical tissue adhesives market.
Excellent progress in the US via 4 
distribution partners covering all 
major sales channels.
Strong sales in Europe via 26 
distribution partners.
LiquiBand®
Our ongoing advertising and marketing 
investment will be enhanced through a series 
of clinical studies to support our marketing 
claims and product positioning. 8  Advanced Medical Solutions Group plc Annual Report 2010
Building strong partnerships
We have strong relationships 
with the leading global 
healthcare suppliers
How we operate
Branded partners
Working with most of the world's leading woundcare 
companies, our products are distributed globally. We believe 
that the most effective way of commercialising new concepts 
and technologies on a global basis is through strategic 
partnerships with major branded companies.
Private label
We also provide own-label products to distributors driven by 
the increasing cost constraints faced by healthcare providers. 
These products allow savings to be made in the treatment 
of routine wounds. 
Distributors
Our LiquiBand® range of tissue adhesives is sold under the 
LiquiBand® brand by distributors and marketing partners in 
Europe and the US.
Quality & regulatory
One of the continuing strengths of the Group is its ability to 
work with different regulatory bodies throughout the world  
to gain regulatory approval for our products. It is pleasing that 
since 2005 we have successfully gained 33 approvals for both 
ourselves and our partners.
The Group’s manufacturing facilities are in compliance with  
ISO 13485.
New site
The new Winsford facility was officially opened in January 201 1. 
It provides the capacity to support the growth of the Group 
and a facility that addresses the increasingly stringent demands 
being placed on medical device companies by various 
regulatory bodies. With nearly £10 million of investment made 
over the last two years, it demonstrates our long term 
commitment to our woundcare partners.
We continue to improve our methods of working and are now 
taking the opportunity to embrace the principles of lean 
manufacturing, positioning the Group for improved future 
operational efficiency. 9 Advanced Medical Solutions Group plc Annual Report 2010   10  Advanced Medical Solutions Group plc Annual Report 2010
Business Review
Strategic Overview
Chris Meredith outlines his 
strategy since taking over as 
Chief Executive Officer
Q  What do you see as your main priorities  
going forward?
A We aim to be recognised as the preferred producer of 
innovative products in the areas of: accelerating healing and managing 
wounds; minimising adverse surgical outcomes; and sealing and closing 
tissue. We now have a world-class facility in Winsford, where we are 
working on delivering the operational efficiencies and resulting margin 
benefits that we believe are possible there. 
LiquiBand®, ActivHeal®, silver alginate and foam in particular all had a 
good year in 2010 and it is important to support these, our key growth 
drivers, going forward.
We are increasing our range of products for the Operating Room 
market and this is a key focus area for us, particularly in terms of 
identifying the most effective routes to market.
We continue to invest in our R&D team which is working on a number 
of exciting new products, such as differentiated foams, active 
woundcare dressings and internal adhesive applications. 
Q  What do you see as the key organic growth  
drivers for AMS?
A Our key growth drivers for AMS are LiquiBand® in the US  
and, within Advanced Woundcare, our ActivHeal®, silver alginate  
and foam products. 
Looking at the bigger picture, the global economic climate means that 
cost efficiency in conjunction with product effectiveness, is increasingly 
more important. I know that our products deliver on both these fronts, 
especially ActivHeal® within the NHS but also LiquiBand® in the US. 
Further out, starting later this year, we expect to see the first of a 
number of new products coming out of our R&D pipeline, as part 
of our drive to provide partners and customers with innovative new 
products.
Q  You are paying a maiden dividend. Why now and 
what is your dividend policy going forward?
A The dividend is a statement of our confidence in the business.
We are now at a stage of sufficient profitability and cash generation 
that we can look at returning additional value to our shareholders.  
We plan to operate a progressive dividend policy, with an approximate 
one-third two-thirds split between interims and finals, whilst ensuring 
that the business has adequate resources to fund our growth plans. 11 Advanced Medical Solutions Group plc Annual Report 2010  
Our Vision
With an exciting range of 
Operating Room focused products 
now complementing the base 
woundcare dressings and 
Emergency Room products, AMS 
continues to benefit from having 
diverse and plentiful growth 
opportunities.
As we continue the evolution 
of the Group, the vision is to 
strengthen our current position 
in each of our key focus areas of 
woundcare dressings and surgical 
devices, and ultimately become 
recognised as the preferred 
producer of innovative products 
and brands in the areas of:
>  accelerating healing and 
managing wounds, 
>  minimising adverse surgical 
outcomes and 
> sealing and closing tissue. 
Q  How are you addressing any gaps in AMS’ 
technologies or access to markets?
A As I mentioned earlier, we are putting a lot of emphasis on 
addressing the best routes into the Operating Room. This is particularly 
important following the latest FDA approval for our LiquiBand® 
Surgical ‘close and protect’ tissue sealant device but also incorporates 
InteguSeal® and the internal adhesive applications coming out of R&D. 
In Advanced Woundcare, we believe the future will lie in antimicrobial 
and ‘active’ wound dressings, and we continue to make good progress 
on these in partnership with universities and others. 
We are a strongly cash generative business with no debt. Combined 
with available bank facilities, we have the flexibility to act on 
opportunities we identify to either license in complementary 
technologies or acquire businesses which can help us with technologies 
or routes to market. The successful acquisition and integration of 
Corpura demonstrates that we can deliver on this strategy, adding to 
our current capabilities.
Q What are the key challenges ahead?
A We have leading market shares in the UK and Europe, and 
we intend to maintain these leadership positions. 
Clearly the US market is a major opportunity for LiquiBand® and the first 
full year gives us cause for optimism, but we do not underestimate  
the challenge of taking market share from our major competitor. 
Elsewhere in the world, we have regulatory approvals in Japan and 
Canada for LiquiBand® and have started selling through partners, 
but these are small early stage markets and are not expected to be 
significant contributors for some time. We are also pursuing regulatory 
approvals in a number of other countries.
As mentioned before, the Operating Room segment is a key focus area. 
We are working with US surgeons on the appropriate design for our 
LiquiBand® Surgical ‘close and protect’ tissue sealant device and we are 
also looking to identify the most effective routes to market. 
More generally, there is increased competition and pricing pressures in 
all our markets, but we believe our approach and our technologies give 
us significant advantages over others. We understand our markets and 
we listen to our partners and to healthcare professionals who feed their 
views back to us, allowing us to constantly improve our offering.  12  Advanced Medical Solutions Group plc Annual Report 2010
Business Review
Chairman's Statement
AMS has a unique position in the advanced 
woundcare market. Our comprehensive 
range of material technologies with strong 
intellectual property allow us to provide our 
global woundcare partners with a breadth 
of product applications second to none.
I am delighted to inform investors that 2010 was an outstanding 
year in which AMS continued to make excellent progress in 
building a major global medical device business. In addition to 
delivering strong revenue and profit growth, a number of key 
commercial and operational milestones, designed to fuel future 
growth, were achieved in the year.
Financial Highlights
Group revenue was up 32% to £31.9 million, profit from operations 
before exceptional items was up 31% to £5.3 million, and profit from 
operations after exceptional items was up 81% to £4.3 million.
The business continues to generate strong levels of cash at the 
operational level, with net cash inflow from operations before 
exceptional items up 116% to £8.1 million. Net cash inflow from 
operations after exceptional items was up 244% to £7.1 million. Even 
after further investment in the new Winsford facility, plant and 
equipment and paying the final deferred consideration for the 
acquisition of Corpura B.V., net funds at year end were up 129% to  
£3.9 million. 
Key Achievements
Entry into the key $220 million US topical skin adhesive market with 
our LiquiBand® tissue adhesive has been a pivotal milestone for the 
Group. Whilst we were confident of success due to the positive 
competitive performance of this product range in Europe over many 
years, the level of interest, clinical evaluations and subsequent initial 
product uptake in our first full year of US sales has exceeded our 
expectations. We are well placed to continue to grow our US market 
share and to build a strong global brand for our LiquiBand® business. 
In Advanced Woundcare, our silver alginate range, our foam based 
wound dressings and our ActivHeal® value range have also continued 
to make good progress. The successful integration of Corpura B.V. has 
bolstered our position in polyurethane foam, the largest, fastest 
growing segment of the advanced woundcare market. 
Our new world-class Winsford facility, officially opened in January 
2011, provides the Group with the capacity to support substantially 
increased revenues, whilst addressing the ever more stringent 
demands being placed on medical device companies by the various 
regulatory authorities. It also provides opportunities to enhance 
margins as the benefits of the new facility and investment in new 
equipment are realised. 
Board
A number of Board changes were made during the year. 
I stepped down as Chief Executive Officer and became Chairman of 
the Group, as of 1 January 2011.
Chris Meredith was appointed as Chief Executive Officer effective from  
1 January 2011. Having joined AMS in July 2005 as Commercial 
Director, Chris was appointed to the Board in April 2006, became 
Managing Director of Advanced Woundcare in 2008 and then Chief 
Operating Officer of the Group in January 2010. 
Dr. Geoffrey Vernon retired as Chairman at the end of 2010. The 
Board would like to thank Geoffrey for his input and guidance in 
helping to make AMS the successful company that it is today. We wish 
him all the best for the future. 
In March 2010, Penny Freer joined the Board as Senior Independent 
Non-Executive Director, and Steve Harris stepped down from the 
Board at the AGM in June 2010. The Board would like to thank Steve  
for his significant contribution to AMS during his nine years as a 
Non-Executive Director. 
Dividends
As previously indicated, the Board will recommend the introduction of a 
maiden final dividend relating to the 2010 results. Whilst AMS’s focus 
remains on capital growth, the Board feels it is appropriate to propose a 
dividend, given the cash generative nature of the business and to reflect 
the stage of the Group’s development. The proposed maiden final 
dividend will be 0.38p per share which will be paid on 10 June 2011 to 
shareholders on the register at close of business on 13 May 2011.
Employees
On behalf of the Board and our shareholders, I would like to thank 
all AMS employees for their considerable efforts in delivering our 2010 
results, and for all their contribution in helping us to move into our 
new facility with so little disruption. 
Outlook
I am pleased to report that 2011 has started well for the Group with 
both our leading brands, LiquiBand® and ActivHeal®, continuing to 
perform strongly. We also continue to see growing demand from our 
partners for our foam and silver alginate products.
In addition to the positive prospects for our organic business, our 
continued investment in R&D and our strong balance sheet allows  
us to refresh and broaden the product range and technology base,  
as well as evaluate opportunities to strengthen our distribution in  
key markets.
Overall, the outlook for the Group remains very positive.
Dr. Don Evans
Chairman
20 April 2011
Dr. Don Evans
Chairman 13 Advanced Medical Solutions Group plc Annual Report 2010  
Our new spinning-line, Winsford, Cheshire 14  Advanced Medical Solutions Group plc Annual Report 2010
Chris Meredith
Chief Executive Officer
Business Review
Chief Executive Officer’s Report
I am pleased to be providing this, my first Chief Executive 
Officer’s Report, on the back of another very positive year of 
further development for the Group. 
With our broad customer base, including almost all major woundcare 
companies, and our multiple routes to market, we continue to occupy 
an enviable position in the markets within which we operate. 
Enhanced by a combination of two strong emerging brands 
(LiquiBand® and ActivHeal®), and three major base technologies 
(fibres, foams and tissue adhesives), the potential for further growth 
remains significant.
Vision 
With an increasing range of Operating Room focused products now 
complementing our base woundcare dressings and Emergency Room 
products, AMS continues to benefit from having diverse and plentiful 
growth opportunities. As we continue the evolution of the Group, the 
vision is to strengthen our current position in each of the key focus 
areas, namely advanced woundcare dressings, tissue adhesives and 
surgical sealants, and ultimately become recognised as the preferred 
producer of innovative products and brands in the areas of:
Accelerating healing and managing wounds; • 
Minimising adverse surgical outcomes; and • 
Sealing and closing tissue. • 
2010 
Advanced Woundcare
Revenue from our advanced woundcare product range, aimed at 
accelerating healing and managing the complications of chronic 
wounds, increased 30% in 2010, with each of our key growth drivers 
contributing to the success. Sales of our silver alginate product range 
were up 19%, the ActivHeal® brand grew 21% and foam grew by 270%. 
Ongoing technical and clinical support for our silver alginate product 
range has continued to drive growth in our silver dressings business 
and has helped our partners capture a 20% market share in just five 
years, second only to the dominant market leader. 
With austerity measures at the forefront of NHS plans, our ActivHeal® 
brand continues to deliver real savings to the NHS without any 
compromise on clinical outcome or patient care. Following a re-launch 
of the product range in new, distinctive and easily recognisable 
packaging, we continue to make progress in establishing ActivHeal® as 
a product of first choice when it comes to cost effective dressing of 
non-infected wounds. 
With foam revenues benefiting from a number of new product 
launches with key partners in 2010, it is clear we have a very well 
accepted base technology from which to drive further organic growth 
through innovation and product differentiation.
The move into the new facility in Winsford was a considerable 
achievement and was successfully completed without severe 
disruption to operations as evidenced by the 11% like-for-like growth 
of the Advanced Woundcare business (excluding Corpura B.V.) during 
the construction period. The effort and commitment shown by 
everyone in the business cannot be underestimated. With the new 
site operational, management has taken the opportunity to embrace 
the principles of lean manufacturing, positioning the Group for 
improved future operational efficiency.
Research and Development has been focused on our new technology 
platform, foam, with the launch of new sizes and shapes and the 
development of composite dressings that elegantly combine different 
layers together in one dressing. Work has also progressed on our 
anti-biofilm product development programme and on our  
active dressings.
Wound Closure and Sealants
Our product range designed to seal and close tissue has also delivered 
strong growth to the Group in 2010. Revenues increased 42% to  
£6.7 million (2009: £4.7 million) with US market entry being a pivotal 
milestone for the business. 
We are very pleased with the progress from our first 12 months of 
promotional activity in the US. As was to be expected, a high number 
of clinical evaluations took place in 2010 as hospitals tried the 
LiquiBand® product for the first time. We are pleased with both the 
outcome of these evaluations and the speed with which a growing 
number of individual hospitals are converting to regular usage. Whilst 
we still have a significant major competitor to contend with, progress 
in our first year has exceeded our initial expectations. It is currently 
too early to say whether the second year of sales will follow the trend 
of our previous product launches and temporarily drop back before 
forging ahead again in year three.
We received regulatory approvals for LiquiBand® in both Canada and 
Japan during 2010, and our products have since been launched in 
both countries via local partners. Elsewhere, the regulatory process 
continues in a number of other markets.
An area for further improvement is the growth rate and sales 
performance for our devices aimed at minimising adverse surgical 
outcomes in the Operating Room. Progress with InteguSeal® through 
our marketing partner Kimberly Clark, has failed to meet both our and 
our partner’s original launch expectations and as such, one of our 
remaining strategic challenges is how we address the routes to market 
and sales success for our surgically orientated Operating Room 
product range. This is increasingly important given we received recent 
confirmation that our LiquiBand® Surgical ‘close and protect’ tissue 
sealant device has just been granted approval in the US.  15 Advanced Medical Solutions Group plc Annual Report 2010  
US Distribution
strategy
Cardinal Health (Acute Focus)
Complementary 
Regional Partner
(Acute Focus)
provides access to key 
acute accounts
Specialist Distribution Partner
provides logistic capabilities and direct 
order fulfilment for small centres and 
individual clinicians
Alternate Site Focus
largest US Pharmaceutical 
Distributor provides access to 
alternate site market 16  Advanced Medical Solutions Group plc Annual Report 2010
Business Review
Chief Executive Officer’s Report continued
We are now working with key surgeons to design the ideal delivery 
system for this surgical device and expect to launch this into the 
market in late 2011, which then gives us a product range covering 
100% of the target market.
Strategy
Our strategy has four key elements: 
Maximising the value of Group brands; • 
Strengthening our commitment to support partners and develop • 
innovative woundcare products;
Improving our ability to generate growth from our Operating Room • 
product range; and
Supplementing organic growth through further licensing and • 
acquisition activity.
Brand building
We have already taken steps to enhance and simplify our corporate 
identity, both for major customers and employees. We have rebranded 
our two acquired businesses, Medlogic Global and Corpura B.V.,  
with all our businesses now trading under the Advanced Medical 
Solutions name. 
Given the potential impact of success with LiquiBand® in the US 
market, and ActivHeal® in our domestic UK market, developing 
excellence in brand management is now a very focused part of our 
plan and we aim to strengthen our support of these brands:
LiquiBand® • , our ongoing advertising and marketing investment 
will be enhanced through a series of clinical studies to support our 
marketing claims and product positioning; and
ActivHeal® • , our rebrand has been well received and we will invest 
further in case studies and technical support to ensure the benefits 
of what the range can deliver to the NHS in terms of potential 
savings is better understood by all healthcare providers.
Commitment to support partners and develop innovative 
woundcare products
We remain committed to the development of leading edge 
technology and products and to working with strategic partners and 
major brands to commercialise them worldwide. Continuing 
investment in R&D will help us to deliver new product platforms such 
as differentiated polyurethane foams and active dressings to address 
the unmet clinical needs of chronic wounds. We will also be continuing 
to invest in clinical papers to support superiority claims for our silver 
alginate products versus the market leader and, in doing so, assist our 
multiple partners in capturing market share.
 
Our investment in our operational capability provides further evidence 
of our long term commitment to our woundcare partners. 
Enhanced ability to generate growth from our Operating 
Room product range
With opportunities for our Operating Room product range increasing, 
and internal applications for our tissue adhesives potentially emerging 
out of R&D in the next 12-18 months, finding the right way to 
successfully access the Operating Room market is a high priority for 
the management team and remains a key challenge.
Supplement organic growth through further licensing and 
acquisition activity
The acquisition and integration of Corpura B.V. has successfully 
provided an additional technology platform from which to drive 
growth within the foam market, the largest and fastest growing 
segment of advanced woundcare. Foam has already delivered 
significant value to the Group in 2010 and, given our position in the 
market, any similar woundcare technology acquisition would provide 
equal growth potential. In addition, we will continue to look for 
synergistic businesses that allow us to leverage our enviable customer 
base, bring new technologies or additional brands to complement our 
existing product range, and distribution opportunities to help us 
overcome the Operating Room challenge.
Chris Meredith
Chief Executive Officer
20 April 2011 17 Advanced Medical Solutions Group plc Annual Report 2010  
Mary Tavener
Group Finance Director
Key drivers of growth
2010-2015
Fibres
(Technology)
Foams
(Technology)
ActivHeal®
(Brand)
LiquiBand®
(Brand)
Income Statement
Revenue for the Group grew 32% in 2010 to £31.9 million  
(2009: £24.1 million). 
Advanced Woundcare sales increased 30% to £25.2 million (2009: 
£19.4 million), benefiting in part from a full year’s contribution from 
the Corpura B.V. acquisition, which was completed on 30 September 
2009. Adjusting for this, like-for-like growth was still 11%, well ahead  
of market growth rates which are estimated to have been about 4%  
in 2010. 
The Group’s key growth drivers in Advanced Woundcare performed 
well, with sales of our silver alginate range of products growing 19% 
compared with last year and sales of ActivHeal®, the Group’s value 
range of woundcare products for the NHS market, increasing 21%. 
Foam is now also a very important part of the business and 
contributed 29% of Advanced Woundcare revenues. 
Wound closure and sealants sales grew 42% to £6.7 million (2009: £4.7 
million), with the main contributor being the first full year of sales of 
LiquiBand® in the US. US revenue benefited from sampling and 
customer evaluations, but has nevertheless exceeded our expectations 
with Quarter 4 annualised end user sales of over 250,000 units. 
InteguSeal® had a disappointing year with sales down by 8% but we 
believe that it remains an excellent product with considerable 
potential that requires a focused sales drive. We are considering 
options as to how to exploit this opportunity more effectively.
Geographically, the strength of ActivHeal® and partner business has 
contributed to the growth of sales in the UK, which increased 15%. Sales 
in Europe grew 35%, mainly due to the foam business in The 
Netherlands, but overall, market conditions in Europe have been difficult 
and we are expecting pricing challenges in 2011 as austerity measures 
start to bite. Sales into the US grew 55% due to the launch of LiquiBand® 
and the Advanced Woundcare business is also performing well.
Profit from operations (pre-exceptional items) increased by 31% to 
£5.3 million (2009: £4.1 million) and our operating margin (pre-
exceptional items) remained at 17%. Advanced woundcare 
contributed £4.7 million (pre-exceptional items of £1.0 million) to this, 
(2009: £4.4 million, pre-exceptional items of £0.9 million), with an 
operating margin of 18.8%, down by 390 basis points (bpts) compared 
with 2009. There was a 430 bpts decline from a change of mix, 
primarily as a result of the previously mentioned lower margin foam 
business while the Winsford site move caused an estimated 60 bpts 
reduction in margin due to the temporary but anticipated disruption 
effect. Operating expenses were, however, leveraged across the entire 
business and reduced as a percentage of revenue, partially offsetting 
the declines. 
Wound closure and sealants contributed £1.6 million (2009: £0.8 
million) to profit from operations, with an operating margin that 
improved by 720 bpts to 24.2% (2009: 17%) resulting from the 
increased volumes through this business. 2011 will see some additional 
marketing spend being incurred to support the LiquiBand® 
opportunity in the US which may impact margin.
Across the Group, administration costs (pre-exceptional items) 
increased 19% to £9.3 million (2009: £7.8 million), including support 
and integration for the new Dutch entity, and investment in sales and 
marketing, in particular supporting the launch of LiquiBand® into the 
US. This increased spend reflects the needs of a larger Group and, 
overall, operating expenses as a percentage of revenue have 
decreased 330 bpts compared with last year. Research and 
Development spend was lower than normal at 4.0% of sales (2009: 
6.7%), partly due to the growth of the Group but also as a result of the 
timing of some projects. Annual rent costs relating to our new facility 
in Winsford are £0.3 million higher than the old facilities. 
Business Review
Group Finance Director’s Report 18  Advanced Medical Solutions Group plc Annual Report 2010
 
Cash flow and balance sheet
The Group had a cash inflow from operating activities, before 
exceptional items, of £8.1 million (2009: £3.7 million), and £7.1 million 
(2009: £2.1 million), after exceptional items of £1.0 million (2009: £1.7 
million), reflecting a very strong second half year performance. The 
cash conversion ratio* was 79% for the year (2009: negative due to 
Winsford capital expenditure, now completed).
Working capital increased in the period by £0.5 million but decreased 
as a percentage of sales to 14.9% (2009: 17.6%). As expected, 
inventory decreased by £0.7 million to £2.5 million (2009: £3.2 million) 
as the Winsford move completed. Trade and other receivables 
reduced by £0.9 million to £6.0 million (2009: £6.9 million) with debtor 
days reducing to 52 (2009: 54). Trade and other payables decreased 
by £2.1 million. The deferred payment for Corpura B.V. of £1.3 million 
was included in other payables in 2009.
During 2010, the Group invested £3.6 million in capital equipment and 
paid the remaining £1.3 million of consideration for the Corpura B.V. 
business. £2.9 million (2009: £3.0 million) of goodwill has been 
recognised on the balance sheet following the acquisition of Corpura 
B.V. in 2009. There has been no impairment in value to goodwill upon 
review as at December 31 2010.
In August 2009 the Group entered into a three year Revolving Credit 
Facility with Lloyds TSB Bank for £5.0 million, including a £1.0 million 
overdraft facility at market rate. As a consequence of this, the Group’s 
going concern position has been strengthened as more fully described 
on page 34 of the Corporate Governance Report. The Group drew 
down £1.0 million of the revolving credit facility during 2010 due to 
the timing of investment in the new site, but it was not being used at 
the end of the year. 
The Group had net funds of £3.9 million as at 31 December 2010.  
The strong balance sheet provides options to support future growth  
of the business.
Mary Tavener
Group Finance Director
20 April 2011
*Cash conversion ratio is defined as cash generated from operating activities before 
exceptional items including spend on property, plant and equipment, software and 
capitalised research and development but excluding spend on acquisitions as a ratio of 
profit from operations before exceptional items.
The Group incurred £1.0 million of exceptional costs in the year, all 
within the Advanced Woundcare division. These costs are associated 
with the move into the new facility in Winsford and result from the 
transfer and re-validation of manufacturing equipment, additional, 
duplicated rent and staff dedicated to the project. There will be no 
further exceptional costs associated with this project.
Profit from operations (post-exceptional items) was £4.3 million, an 
increase of 81% compared with 2009 (2009: £2.4 million).
The Group works with existing and new partners on development 
projects and earns income through these projects. This is, however, 
becoming a less important part of the business, with the Group 
looking to secure more value by developing products alone. £0.2 
million of other income was earned in the period (2009: £0.5 million) 
from these activities. 
The Group achieved pre-exceptional profit before tax of £5.3 million in 
the period, an increase of 30% compared with 2009 (£4.1 million). 
Profit before tax after exceptional items was up 79% to £4.3 million  
(2009: £2.4 million). 
The Group recognised a tax credit of £0.5 million (2009: £0.4 million), 
£0.3 million of which resulted from deferred tax reflecting the extent 
to which recoverability of tax losses can be foreseen with reasonable 
certainty. The Group holds a deferred tax asset in respect of tax losses 
on the balance sheet of £2.3 million (2009: £1.8 million) and has a 
further £19.1 million (2009: £24.0 million) of tax losses that have not 
been recognised. Corpura B.V., when acquired, had accumulated a 
small amount of tax losses and, with this business performing strongly, 
the Group anticipates that it will pay tax in The Netherlands ahead of 
the businesses in the UK.
Profit after tax but before exceptional items for the period was  
£5.8 million (2009: £4.5 million). On this basis, adjusted basic earnings 
per share increased by 24% to 3.83p (2009: 3.09p). Fully diluted 
earnings per share before exceptional items were 3.77p (2009: 2.87p). 
The Group profit after tax and exceptional items was £4.8 million  
(2009: £2.8 million) resulting in a basic earnings per share of 3.17p 
(2009: 1.93p) and fully diluted earnings per share of 3.12p  
(2009: 1.79p).
The Board is proposing a maiden final dividend of 0.38p per share 
(2009: nil) which will be paid on 10 June 2011 to shareholders on the 
register at close of business on 13 May 2011. 
Business Review
Group Finance Director’s Report continued 19 Advanced Medical Solutions Group plc Annual Report 2010  
KPIs Target Result
Revenue growth (like-for-like) 10% growth year on year 18% (2009: 19%)
Operating margin (pre-exceptional) 20% by 2012 17% (2009: 17%)
Earnings per share (fully diluted, pre-exceptional) 20% growth per annum 31% (2009: 33%)
Percentage of sales from products launched 30% 20%* (2009: 30%) 
in the last five years 
Customer Service OTIF (on time, in full) of 90% 86% (2009: 93%)
We continue to improve our methods of working and 
are embracing the principles of lean manufacturing
*Launches of new products reduced to avoid additional risk with site move. 20  Advanced Medical Solutions Group plc Annual Report 2010
1 2 3
1. Dr. Don W Evans
BChemEng, MASc, PhD 
Non-Executive Chairman 
After completing a degree in Chemical 
Engineering at the University of Queensland 
and a PhD in Biomedical Engineering at the 
University of Toronto, Dr. Evans joined 
Johnson & Johnson UK where he worked for 
19 years in Research & Development and 
Manufacturing. He was subsequently 
appointed as Vice-President of European 
Operations for Johnson & Johnson 
Professional. Dr. Evans joined AMS in 1997 as 
Operations Director and was appointed 
Managing Director of Advanced Woundcare 
in January 1999. He became Group Chief 
Executive in January 2000 and was appointed 
Non-Executive Chairman of the Group in 
January 2011.
2. Chris Meredith
BSc (Hons)
Chief Executive Officer
Mr. Meredith joined AMS as Group 
Commercial Director in July 2005 following a 
successful 18 year career in international 
healthcare sales, marketing and business 
development. His experience prior to joining 
AMS covered business to business contract 
manufacturing, product development and 
clinical research, as well as branded product 
sales, all within the medical device, 
pharmaceutical or consumer healthcare 
markets. He was appointed Managing 
Director of Advanced Woundcare in February 
2008 and in January 2010, he became Chief 
Operating Officer for the Group. Mr. Meredith 
has previously held senior positions at Smiths 
Industries, Cardinal Health, Banner 
Pharmacaps, and Aster Cephac. He was 
appointed Group Chief Executive Officer in 
January 2011.
3. Mary G Tavener 
ACMA, MCT, BA (Hons) Chem (Oxon) 
Group Finance Director
Ms. Tavener joined AMS as Finance Director in 
1999. Prior to this, she was the Group 
Financial Controller at BTP plc during a period 
of considerable corporate activity and was 
involved in the acquisition and disposal of 
several businesses that repositioned BTP plc 
as a fine chemical company. Her experience 
has been gained in manufacturing and she 
has held financial positions with Cadburys Ltd 
and Parker Hannifin, a US Engineering 
Corporation. Prior to BTP plc, she was the 
Finance Director of Churchill Tableware Ltd. 
Advanced Medical Solutions Group
Directors  21 Advanced Medical Solutions Group plc Annual Report 2010  
4 5
4. Penelope A Freer 
Senior Independent Non-Executive Director
Ms. Freer was appointed as Senior 
Independent Non-Executive Director of AMS 
on 1 March 2010. She is currently a Non-
Executive Director of Empresaria Group plc 
and Senior Independent Director of Sinclair 
Pharma plc. She is a director of London Bridge 
Capital an FSA authorised advisory business. 
With 25 years’ experience in investment 
banking she was formerly Head of Equities for 
Robert W Baird in London and prior to this 
held senior positions at Credit Lyonnais and 
NatWest Markets.
5. Stephen G Bellamy  
BCom & CA (NZ) 
Non-Executive Director
Mr. Bellamy was appointed as Non-Executive 
Director of AMS on 20 February 2007.  He is 
currently CEO and a founding partner of 
Accretion Capital LLP (provider of strategic 
capital to European emerging technology 
companies), Chairman of The First Close 
Technology Fund (which invests in early stage 
UK technology companies) and Non-
Executive Director of Becrypt Ltd (data 
security and protection technology). Formerly 
an Executive Director of Sherwood 
International plc and Brierley Investments’ 
London operations, he has also held a number 
of other non-executive directorships and 
advisory roles. He is a New Zealand qualified 
chartered accountant. 22   Advanced Medical Solutions Group plc Annual Report 2010
Advanced Medical Solutions Group
Management Team
1 .  J e f f r e y W i l l i s B S c ( H o n s ) , E M S M O T 
Vice President Strategic Marketing 
Jeff joined AMS in October 2005 as Vice President Business 
Development, Americas, where he managed the US base of business.
Jeff graduated with a degree in Biomedical Engineering from the 
University of Florida in 1996 and completed a Masters programme in 
Management of Technology at Georgia Institute of Technology in 
2001. He spent 10 years with Kimberly-Clark Health Care in R&D, 
Product Development, and New Business Development, and was a key 
member of the medical device M&A strategy team in Atlanta. In 2004, 
Jeff joined Abbott Laboratories in Columbus, Ohio as Manager of 
Licensing and Business Development supporting the medical 
nutritional and consumer products division.
In October 2009, Jeff and his family relocated to the UK when he 
assumed the role of Vice President of Strategic Marketing.
2 .  R i c h a r d S m i t h , A C A
Group Financial Controller 
Richard joined AMS in January 2009 having qualified as a chartered 
accountant in 1996. 
After periods in banking and private practice, Richard joined Astra 
Zeneca in 2000 where he worked in a number of finance roles 
culminating in the position of Finance Director, M&A and Strategic 
Planning as part of a deal team covering commercial, manufacturing,  
R&D and legal.
3 .  R i c h a r d S t e n t o n
Vice President of Group Operations
Richard was Managing Director of MedLogic Global Ltd. (now 
Advanced Medical Solutions Plymouth Limited) when it was acquired 
by AMS in May 2002. Richard was subsequently appointed as General 
Manager where he had responsibility for R&D and Operations for the 
Wound Closure and Sealants business. Richard was appointed Vice 
President of Group Operations in July 2010.
Richard spent 14 years in engineering and manufacturing with  
CR Bard Ltd, three years as a Project Director installing medical device 
manufacturing processes in Europe, South Africa and the Far East 
before joining HG Wallace – Smiths Industries Medical Systems in 1989 
as Manufacturing Manager covering six medical device manufacturing 
sites in the UK. He joined MedLogic Global Ltd. in 1997 and was 
responsible for setting up and managing the UK operation for its tissue 
adhesives business. 
3 2 1 23 Advanced Medical Solutions Group plc Annual Report 2010  
4 .  S t e v e P l a t t
General Manager, Winsford
Steve was appointed as General Manager, Winsford in June 2010.  
Steve brings 16 years of experience from major multi-national 
manufacturing companies. Prior to AMS he held senior positions at 
Toyota Manufacturing (UK), JCB Excavators, RWD Technologies and, 
most recently, Nilfisk Advance A/S where he was General Manager for 
green field operations in Eastern Europe and also had responsibility for 
European restructuring projects including Group M&A support. Steve 
has a track record for maximising business performance through the 
implementation of lean management techniques.
5 .  I a n V i c k e r y B A (H o n s ) , M C I P D
Group HR Manager
Ian was appointed Group HR Manager in April 2009. After graduating 
in Geography from Leeds University, Ian completed a Postgraduate 
Diploma in Personnel Management in 1989, and a Diploma in Safety 
Management in 1995. An HR specialist with 20 years’ experience 
within automotive, engineering, manufacturing and pharmaceuticals, 
Ian has operated at a senior level within the UK and Europe to support 
businesses and their management teams in delivering their strategic 
goals and objectives.
6 .  C l a r e H o l d e n B S c ( H o n s )
Vice President of Group Research and Development
Clare was appointed in July 2010. She has over 20 years of process and 
new product development experience with global organisations such 
as Smith & Nephew where her last position was Vice President of New 
Product Development for their Hull based Wound Management 
Division. Most recently, Clare was Director of Projects at Siemens’ 
Automation & Drives Division in Manchester.
7 .  P i e t e r v a n H o o f , M E n g
General Manager, Etten Leur
Pieter joined Advanced Medical Solutions B.V. in November 2009. Having 
completed a Masters degree in Engineering in Chemistry and 
Biochemistry at the Katholieke Universiteit Leuven (Belgium), Pieter 
joined Janssen Pharmaceutica working as a production supervisor in the 
manufacturing unit for sterile injectable products before joining the 
DuPont Engineering Polymers business in September 1999. At DuPont 
Engineering Polymers Pieter worked in a number of business process 
improvement roles in Supply Chain certifying as a 6 Sigma Master Black 
Belt before moving into Sales & Marketing gathering experience in 
account management and business development. Before joining 
Advanced Medical Solutions B.V. Pieter held the position of European 
Customer Services Manager for DuPont Engineering Polymers.
4 5 6 7 Advanced Medical Solutions
24  Advanced Medical Solutions Group plc Annual Report 2010
Advanced Medical Solutions Group
Corporate Governance Standing Committees
Audit Committee
S.G. Bellamy (Chairman)
P.A. Freer since 1 March 2010
D.W. Evans since 1 January 2011
S. Harris until 2 June 2010
G. Vernon until 31 December 2010
Remuneration Committee
P.A. Freer since 1 March 2010 (Chairman) since 2 June 2010
S.G. Bellamy
D.W. Evans since 1 January 2011
S. Harris (Chairman) until 2 June 2010
G. Vernon until 31 December 2010
Nominations Committee
D.W. Evans (Chairman) since 1 January 2011
P.A. Freer since 1 March 2010
S.G. Bellamy
C. Meredith since 1 January 2011
S. Harris until 2 June 2010
G. Vernon (Chairman) until 31 December 2010
Company Secretary
M.G. Tavener
Registered Office
Premier Park, 33 Road One, Winsford Industrial Estate, Winsford, Cheshire, CW7 3RT
Registered Number
2867684 25 Advanced Medical Solutions Group plc Annual Report 2010  
The directors present their report and the audited financial statements 
for the year ended 31 December 2010.
Principal activities, trading review and future developments
The Group is primarily involved in the design, development, 
manufacture and distribution of novel high performance polymers, 
both natural and synthetic, for use in advanced woundcare dressings 
and the design and distribution of medical adhesives for closing and 
sealing tissue. The Group distributes its products to the global medical 
device market by selling to healthcare companies, distributors and 
directly to the NHS in the UK.
In addition to the risk factors discussed below, further information 
about the business, its strategy, products and markets and its financial 
risks is contained in the Business Review on pages 10 to 19.
Principal risks and uncertainties
Advanced Medical Solutions Group plc is a business that depends on 
revenues through its sales to business partners and distributors and its 
direct sales to the NHS, a successful pipeline of new products through 
its research and development programme to build future revenues 
and a manufacturing capability to produce the products it sells.
Risk associated with global economic conditions
The Group has a widespread geographical market sector and customer 
base which minimises the impact of any single event. With an ageing 
population increasingly suffering health problems such as obesity and 
diabetes, the incidence of chronic wounds is increasing and the 
demographics are beneficial for the Group. That said, the general 
economic climate is one where a number of governments particularly in 
Europe are looking to reduce spend on public services. Whilst healthcare 
may not be the first target of such spending cuts, it is unlikely to be 
unscathed by the austerity measures being undertaken.
Risk associated with revenue streams
The Group’s revenues are mainly from the sale of its products. The 
Group enters contractual relationships with its business partners 
wherever possible, however, there can be no guarantee that sales will 
be maintained or increased in future years. There has been 
consolidation in the healthcare sector in recent years which is 
ongoing. This presents both opportunities and risks. Consolidation 
could result in the loss of a partner which could have a material effect 
on the results of the Company.
The Group maintains close partnerships with a number of companies 
so that not more than 20% of its revenues are from any one partner. 
However, the loss of a key partner would impact the business 
significantly in the short-term.
There are also risks from pricing pressure and from competition from 
other products particularly when the economic climate is difficult. The 
Group seeks to provide differentiated products that are patented 
wherever possible to reduce the effects of competition.
The Group is reliant on its business partners and distributors for 
success in markets outside the UK. The Group supports its partners 
and distributors with marketing assistance and with clinical trial 
programs where possible to drive awareness of its products. There is a 
risk that if partners and distributors do not support the products that 
opportunities may be lost, resulting in revenue shortfall.
Risk associated with new products
The Group continues to invest in research and development to 
develop its next generation of products. By its nature, not all research 
leads to successful new products, although the Group believes that by 
monitoring progress against key milestones, it avoids excessive 
expenditure on projects that will not deliver a viable product. There is 
also the risk that the Group will not identify a new technology or 
opportunity before its competition and may, therefore miss an 
opportunity to gain competitive advantage.
Risk associated with manufacture
The Group identified a need to increase its capacity and as a result 
decided to move its two existing sites in Winsford into one new 
premises on the same industrial estate. This move has now been 
completed and the risk that it would cause supply problems for 
customers or significantly overrun or be over budget has been 
successfully managed. There remains, however, the risk that the 
project will not deliver the benefits expected.
The Group is also exposed to the risk that margins would be eroded if 
price increases occur in raw materials, and the price increases could 
not be passed on to its business partners or customers. Wherever 
possible the Group tries to maintain more than one source of supply  
of key materials. Where materials can only be sourced from a sole 
supplier or are linked to commodity prices the Group includes pricing 
mechanism clauses in its contracts wherever possible. If a sole supplier 
stopped supplying a key material at short notice, it could result in  
an interruption of supply of goods until a suitable solution could  
be found.
As a manufacturer, the Group is exposed to potential product liability 
claims but has in place insurance cover to manage this potential risk. 
The Group’s products are subject to medical device regulatory 
approval and certification before launch. The Groups manufacturing 
facilities are in compliance with ISO 13485, the latest international 
quality assurance standard for medical devices and receives regular 
inspection by regulatory authorities.
Risk associated with the information systems
As the Group continues to grow, there is a risk that without addressing 
resource issues that the Group does not address opportunities 
appropriately or it outgrows its information systems.
The Group is reviewing and upgrading its information systems and 
recognises that there are risks in implementing new systems which 
need to be managed but that to not upgrade systems would present  
a greater risk. As a medical device business any implementation has to 
meet stringent quality requirements and be a fully validated system.
Whilst this may result in any change in business information systems 
taking longer or costing more to implement, it does mean that the  
risk of unsuccessful implementation is significantly reduced.
Risk associated with the organisation
The Group recognises that the calibre and strength in depth of the 
organisation and its ability to develop its leadership talent are key to 
the future of the business.
Accordingly, the Group maintains active recruitment, development 
and training programmes, attractive incentive schemes and pro-active 
succession planning.
Report of the Directors
f or   t he   y e a r   ended   3 1   Decem ber  2 0 1 0 Advanced Medical Solutions Group
26   Advanced Medical Solutions Group plc Annual Report 2010
Financial risk
The Group is subject to various financial risks including the following:
Currenc y •    
The Group’s main currency exposure is to the US dollar with around 
28% of the Group’s sales denominated in US dollars. The Group’s 
policy is to hedge significant transaction exposure (50% – 80% of 
the sales for 12 months) to the dollar by using forward contracts  
and options. In 2010, if the average dollar had depreciated  
against sterling by 10% more, the average rate would have had a 
£0.8 million (2009: £0.5 million) impact on revenue and the gross 
margin would have been reduced by 1.5 percentage point.
C r e di t •   
The Group assesses the risk of contracting with each customer  
and sets credit limits which are carefully monitored. If a significant 
risk is identified credit facilities are withdrawn and transactions  
are carried out on a cash basis. However, if a key partner was 
significantly affected by a difficult trading environment, this  
would have a short term impact on the Group.
P r i c e •   
Supplier costs, discounts and rebates are monitored and checked 
in line with budgets and documentary evidence. Wherever 
possible contracts are in place with key suppliers which define 
prices and terms. The Group estimates that if material prices had 
increased by a further 5% in 2010 and the Group was unable to 
pass the increases on there would have been a negative impact of 
£0.4 million (2009: £0.2 million) to the cost and the gross margin 
would have been reduced by 1 percentage point.
Going concern
After making enquiries on the basis of current forecasts the directors 
have a reasonable expectation that the Group has adequate resources 
to continue in operational existence for the foreseeable future and for 
this reason they continue to adopt the going concern basis in 
preparing the accounts.
Dividends
The Group made a profit for the year to 31 December 2010 of 
£4.8 million (2009: £2.8 million). The directors are recommending a 
payment of a final dividend of 0.38p. The final dividend will be subject 
to shareholders’ approval to be paid on 10 June 2011 to shareholders 
on the register on 13 May 2011.
Research and development
The Group has expensed to the income statement in the year ended 
31 December 2010 £1,289,000 of expenditure (2009: £1,613,000) on 
research and development. In accordance with International 
Accounting Standards a further £167,000 (2009: £301,000) has been 
capitalised. Further details on the Group’s research and development 
are included in the Business Review on pages 10 to 19.
Creditors’ payment policy
The Group’s policy, for all suppliers, is to fix terms of payment when 
agreeing the terms of each business transaction, to ensure the 
supplier is aware of those terms, and to abide by the agreed terms of 
payment provided that the supplier performs its obligations. Where 
terms have not been specifically agreed, it is the Group’s practice to 
settle invoices in line with local and industry requirements. The 
Group’s trade creditors at 31 December 2010 represented 
approximately 71 days of purchases (2009: 72 days).
Charitable and political contributions
The Group did not make any charitable or political contributions 
during the year (2009: £nil).
Share capital and issue of ordinary shares
The authorised and issued share capital of the Company is set out in 
note 31 to the accounts on page 61.
Substantial shareholdings
The Company’s major shareholders at 8 March 2011 were:
  No of 
  Ordinary  
  Shares Per cent
Axa Framlington Investment Management  15,116,427 9.77
Legal & General Investment Management  10,213,303 6.60
Hargreave Hale, Stockbrokers  7,462,425 4.82
Standard Life Investments  7,000,000 4.52
Invesco Perpetual  6,297,582 4.07
Schroder Investment Management  6,076,500 3.93
Old Mutual Asset Managers  5,224,154 3.37
Cavendish Asset Management  4,796,225 3.10
Employees
The Group’s policy is to consult and discuss with employees, through 
meetings, both formal and informal, those matters likely to affect 
employees’ interests. The Employees’ Consultative Committee, which 
comprises of representatives of employees and management, meets 
regularly to discuss business issues and areas of concern.
Employees are incentivised directly through the Company’s bonus 
scheme, share option schemes, deferred share bonus schemes, 
performance reviews, and training and development opportunities. 
The Group’s aim is to recruit and retain sufficient skilled and motivated 
employees to meet the needs of the business. The required skills are 
defined and employees are encouraged to acquire additional skills for 
which they are remunerated. Each line manager is responsible for 
implementing this approach.
It is the Group’s policy to give full and fair consideration to all 
applications for employment from disabled persons having regard to 
their particular aptitudes and abilities and to encourage the training 
and career development of all personnel employed by the Group, 
including disabled persons. Should an employee become disabled, the 
Group would, where practicable, seek to continue the employment 
and arrange appropriate training.
Report of the Directors continued
f or   t he   y e a r   ended   3 1   Decem ber  2 0 1 0 27 Advanced Medical Solutions Group plc Annual Report 2010  
Employees’ share schemes
All employees except for participants in the Long Term Incentive Plan (LTIP) are eligible after a period of service to be granted options over shares 
in the Company under the Company’s Executive Share Option Schemes. Options granted under these schemes are not offered at a discount. 
Further details are included in the Remuneration Report on pages 29 to 31.
The Company also operates a Deferred Share Bonus Scheme (DSB) in which all employees are invited to participate. The DSB encourages 
employee share ownership and aligns the employees’ interests with those of the shareholders. The details of the DSB are provided in  
the Remuneration Report on page 29 to 31.
The Company no longer satisfies the requirements for granting tax efficient options under its EMI scheme. Options already granted under this 
scheme will be allowed to vest in accordance with the rules of the scheme.
The Group received approval last year to adopt a Company Share Option Plan (CSOP) which received HMRC approval. Under the CSOP, employees 
are allowed to receive up to £30,000 of options in a tax efficient manner.
Health and safety
The Group is committed to high standards in health, safety and environmental performance. It is the Group’s policy to abide by all laws, 
directives and regulations pertinent to its field of operations and to act in a manner so as to minimise the effects of its operations on the 
environment. The Company provides safe places and systems of work, safe plant and machinery, safe handling of materials and ensures that 
appropriate information, instruction and training is given. Employees are encouraged to identify ‘near misses’ to ensure preventative actions  
are taken to avoid any unsafe work practices. Regular audits are undertaken to evaluate compliance with Group policy.
Environment
Where possible, the Group aims to reduce its impact on the environment. The new Group facility at Winsford has been built with a high level of 
thermal insulation to reduce the Company’s carbon footprint. It is also one of the first in the country to utilise a solar wall; a renewable energy 
source that captures the sun’s warmth and supplements the building’s heating system. Lighting is controlled by movement sensors to avoid 
wastage and the heating system is fully programmable.
Directors and their interests
The directors of the Company at 31 December 2010 and their interests, all of which are beneficially held, in the share capital of the 
Company were:
 Ordinary shares  Ordinary shares 
  of 5p each  of 5p each 
 31 December 2010 
||||||| ||
  31 December 2009
   Shares Options LTIP Shares Options LTIP
Geoffrey Vernon   1,000,000 – – 1,000,000 – –
Don Evans   3,162,587 – 293,843 869,591 616,666 3,295,016
Mary Tavener   2,055,511 – 193,408 246,130 300,000 2,407,979
Steve Harris   – – – 202,127 – –
Chris Meredith   1,125,735 – 589,234 111,850 – 1,797,234
Steve Bellamy   100,000 – – 100,000 – –
On 22 March 2010, Don Evans, Mary Tavener and Chris Meredith, following the achievement of certain performance criteria and the release of 
preliminary results, exercised options and LTIPS. Shares were sold at 35p to meet the costs of exercise and taxes payable.
Further details of the directors’ remuneration and benefits are included in the Remuneration Report on pages 29 to 31.
Reappointment
At the forthcoming Annual General Meeting, Don Evans who was elected Non-Executive Chairman on 1 January 2011 retires and formally offers 
himself for reappointment. As disclosed in the Corporate Governance statement on pages 32 to 34, as Don was not independent upon 
appointment, he will be proposed for re-election annually. Steve Bellamy will retire by rotation and, being eligible, will be proposed for 
reappointment. Details of the current directors of the Company are as shown on pages 20 to 21. Advanced Medical Solutions Group
28   Advanced Medical Solutions Group plc Annual Report 2010
Report of the Directors continued
f or   t he   y e a r   ended   3 1   Decem ber  2 0 1 0
Directors’ responsibilities statement
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 financial statements  
for each financial year. Under that law the directors are required  
to prepare the 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 elected 
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 judgments 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;
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 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 adequate 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.
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.
Responsibility statement
The directors confirm that to the best of their knowledge:
the financial statements, prepared in accordance with International • 
Financial Reporting Standards, 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
the management report, which is incorporated into the directors' • 
report, 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.
Auditor
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 auditor is unaware; and 
the director has taken all the steps that he/she ought to have taken • 
as director in order to make himself/herself aware of any relevant 
audit information and to establish that the Company’s auditor is 
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 
auditor and a resolution to reappoint them will be proposed at the 
forthcoming Annual General Meeting.
Annual General Meeting
The Annual General Meeting will be held at 11.00 am, on Wednesday  
8 June 2011 at Macdonald Portal Hotel, Cobblers Cross Lane, Tarporley, 
Cheshire CW6 0DJ. Details of the notice of the Annual General Meeting 
are given on pages 73 and 74. The Annual General Meeting provides 
an opportunity for private shareholders to question the directors and 
to meet informally with the executive management after the meeting.
On behalf of the Board
M a r y T a v e n e r
Company Secretary
20 April 2011 29 Advanced Medical Solutions Group plc Annual Report 2010  
Remuneration Report
As an AIM quoted company, Advanced Medical Solutions Group plc  
is not required to comply with the Directors’ Remuneration Report 
Regulations 2002. The following disclosures are made voluntarily.
The members of the Remuneration Committee are all Non-Executive 
Directors of the Group and have no personal financial interest arising 
from cross-directorships and no day-to-day involvement in running the 
business. The Committee met six times during the year.
The Board has accepted the Remuneration Committee’s 
recommendations in full.
The Remuneration Committee, on behalf of the Board and in 
consultation with the Chief Executive, determines the Group’s policy 
on executive remuneration, employment conditions and the individual 
remuneration packages of Executive Directors and management 
earning in excess of £75,000 per annum and administers the Share 
Option Schemes. At the start of 2011, the Remuneration Committee 
reviewed its Terms of Reference and it was agreed by the Board that 
the remuneration of all employees that reported to the Executive 
Directors together with any other managers with a remuneration 
package of £100,000 or greater would be determined by the 
Remuneration Committee.
Remuneration policy
The remuneration policy is based on the need to offer competitive 
packages to attract and retain senior executives of the highest calibre. 
Regular reviews of the policy are carried out, supported by independent 
advice, to ensure that the range and level of emoluments and 
incentive schemes continue to match current market practice.
Salary
Salaries are benchmarked against market medians, taking 
performance into account.
Annual performance bonus
The service agreements provide that each Executive Director shall be 
entitled to receive an annual bonus to be determined by the 
Remuneration Committee based on the Group’s financial and operating 
performance. Each participant may receive up to 60% of his or her 
salary dependent upon performance measured against targets resulting 
from the completion of the Group’s business plan, the performance of 
the Group and other personal targets. The first 20% of a bonus may be 
taken in cash. 50% of any additional bonus is deferred as part of the 
deferred bonus scheme. Shares are acquired and placed in trust.
Share options
All employees, except for participants in the Long Term Incentive Plan 
(LTIP), can be granted options over shares in the Company under the 
Company’s Executive Share Option Schemes, under which both 
approved and unapproved options may be granted. Options granted 
under these schemes are not offered at a discount.
The exercising of options under these schemes is conditional on 
certain performance conditions which are pre-determined by the 
Remuneration Committee and which accord with the Joint Statement 
from the Investment Committees of the Association of British Insurers 
and the National Association of Pension Funds. Options are exercisable 
normally only after the third anniversary of the date of grant (or such 
later time as may be determined at the time of grant) and cannot in 
any event be exercised later than the tenth anniversary of the date of 
grant. Full details of these are included in note 34 on page 62.
Options issued under the Scheme will be allowed to vest in accordance 
with the scheme rules. The Company received approval for a Company 
Share Option Scheme (CSOP) on 2 June 2010. This was adopted after 
HMRC approval on 13 August 2010. This Scheme will allow relevant 
employees to benefit in the growth of the value of AMS shares subject 
to a £30,000 limit by reference to the market value of these shares on 
the grant date.
Long-term Incentives
Following feedback from shareholders, proposals for the adoption of  
a LTIP were introduced as the most appropriate vehicle for long-term 
incentivisation for Executive Directors and other senior employees. 
The Company’s LTIP was approved by shareholders on 24 May 2005. 
Those individuals who are entitled to awards under the LTIP are no 
longer eligible to receive options under the Company’s Executive 
Share Option Schemes. Options issued to those employed prior to the 
introduction of the LTIP were still exercisable subject to the relevant 
performance criteria being met. The objectives of the LTIP are to align 
the interests of executives with those of shareholders by making a part 
of remuneration dependent on the success of management in 
delivering superior returns to shareholders. 50% of the award will be 
determined based on the performance of the Company compared 
with the AIM Healthcare Share Index and 50% of the award will be 
determined by the growth in the average earnings per share per year 
of the Company over the last three year period prior to vesting.
Of the 50% of the award that is determined by reference to the AIM 
Healthcare Share Index, no shares will be awarded if the Company is 
ranked below the 50% level. If the Company is ranked in the upper 
quartile of the index ie. at 75% or above, the full 50% of the award 
shall become vested. If the Company is ranked between 50% and 
75%, the provision of an award which shall become vested shall be 
determined on a straight-line basis between 0% and 50%.
The other 50% of the award will be vested if the Company achieves an 
average of 30% or more earnings per share growth per year. No award 
will be vested if the Company achieves an average of less than 10% 
earnings per share growth in any one year.
The proportion of the award that shall become vested if the 
Company achieves an average earnings per share growth per year 
between 10% and 30% shall be on a straight-line basis between 0% 
and 50% per cent.
The Remuneration Committee review annually the performance 
criteria for the vesting of LTIPs.
As with share options granted under the Company’s Executive Share 
Option Scheme, awards will not vest if the Company is not profitable 
at the end of the performance period.
Deferred Share Bonus Plan
The Company has also set up a Deferred Share Bonus Plan (the ‘DSB’) 
which is available to all employees. The DSB allows for the payment of 
any bonus to be made in the form of shares. It also allows for the 
provision of additional matching shares if the bonus shares are held for 
a set period. The DSB encourages employees to acquire shares in the 
Company and retain those shares to receive additional free shares 
from the Company. It acts as a valuable retention tool and aligns 
employees’ interests with those of shareholders. The first year that  
the DSB operated was in 2007. The Company intends to continue  
to operate the scheme in 2011. Advanced Medical Solutions Group
30   Advanced Medical Solutions Group plc Annual Report 2010
Remuneration Report continued
Pension
Executive Directors are entitled to become a member of the Group Pension and Life Assurance Scheme, which was set up with effect from  
1 February 1999. This covers all employees and requires a contribution of 3% by the employee and 6% by the Group. Executive Directors may 
contribute up to 10% and the Group contributes 10%. The Pension Plan is a money purchase scheme.
Service agreements
The service agreements for Mary Tavener and Chris Meredith are terminable by either party giving not less than twelve months notice in writing.
Private healthcare
Executive Directors are entitled to private healthcare and permanent health insurance.
Car
The Company no longer considers it to be market practice to offer Company vehicles to Executive Directors.
Non-Executive Directors
The fees of the Non-Executive Directors are determined by the Executive Directors. Non-Executive Directors receive travel expenses but do not 
participate in any incentive arrangements. The Non-Executive Directors have entered into terms of appointment. The Non-Executive Directors’ 
appointments are terminable by either party upon six months notice in writing. Upon becoming Non-Executive Chairman, a new service 
agreement was agreed with Don Evans. His appointment as Non-Executive Chairman was agreed for an initial term of one year. Thereafter, his 
appointment is terminable by either party upon six months notice in writing.
As a result of his previous position as Chief Executive Officer, Don Evans has LTIPs issued with a vesting date of 23 April 2012. The Remuneration 
Committee have recommended that these LTIPs will be allowed to vest in the normal way, subject to the usual performance conditions. As 
Non-Executive Chairman, Don Evans will no longer be eligible to receive future LTIPs.
Don Evans also has bonus earned in earlier years deferred as part of the Deferred Bonus Scheme. The Remuneration Committee has 
recommended that Don Evans be allowed to leave his shares in the scheme for the normal retention time and not be required to withdraw  
them early from the scheme.
Directors’ emoluments
       Total Total 
      Paid to year year 
  Salary & Annual   third ended ended 
  fees bonus Benefits Pension parties 2010 2009 
  £’000 £’000 £’000 £’000 £’000 £’000 £’000
Executive
Don Evans  198 – 28 20 – 246 307
Mary Tavener  132 – 24 13 – 169 196
Chris Meredith  143 – 34 14 – 191 195
Non-Executive
Geoffrey Vernon  – – – – 75 75 49
Steve Harris  – – – – 15 15 30
Steve Bellamy  – – – – 31 31 31
Penny Freer  – – – – 28 28 –
  473 – 86 47 149 755 808
The table above summarises the payments made to the directors for the 2010 financial year.
The annual bonuses paid to the Executive Directors in 2010 are in respect of the prior financial year. No bonuses were paid in 2010 for the 2009 
financial year. Bonuses to the directors are not determined until the financial results have been audited and approved by the Board. The benefits 
paid to the directors include payments made by the Company to settle liabilities incurred by the directors. The directors have no liabilities with 
the Company at the end of the year.
The opening share price for the year was 33.5p and the closing price on the last trading day of 2010, 31 December, was 73p. The range during 
the year was 74.75p (high) to 32p (low). (Source: daily official list of the London Stock Exchange). 31 Advanced Medical Solutions Group plc Annual Report 2010  
Directors’ interests in share options
Unapproved Executive Share Option Scheme
 Number of Ordinary  Number of Ordinary 
  shares under option 
 
 shares under option
   As at  As at    
   31 December  Exercised in 31 December Exercise Date of 
   2009 the year 2010 Price (p) Grant
Don Evans   616,666 616,666 – 9.00  15 July 2004
Mary Tavener   300,000 300,000 – 9.00  15 July 2004
These options are exercisable on or after the third anniversary of the date of the grant and will lapse on the tenth anniversary of the date of 
the grant. These options were exercised in 2010.
Directors interests in the Long-Term Incentive Plan (LTIP)
The maximum number of shares to be allocated to the directors under the LTIP, in each case for an aggregate consideration of £1, are as follows:
      Market  
      price  
   As at  As at at date First 
   31 December Exercised in 31 December of grant vesting 
   2009 the year 2010 (p) date
Don Evans   1,865,173 1,865,173 – 8.75 12 October 2008
   1,136,000 1,136,000 – 16.75 12 March 2010
   293,843 – 293,843 33.30 23 April 2012
Mary Tavener   1,348,571 1,348,571 – 8.75 12 October 2008
   866,000 866,000 – 16.75 12 March 2010
   193,408 – 193,408 33.30 23 April 2012
Chris Meredith   500,000 500,000 – 8.75 12 October 2008
   708,000 708,000 – 16.75 12 March 2010
   589,234 – 589,234 33.30 23 April 2012
The entitlement to shares under the LTIP is subject to achieving the performance conditions referred to on page 29. The figures shown are 
maximum entitlements and the actual number of shares (if any) will depend on these performance conditions being achieved. New Bridge 
Consulting LLP have advised on the Total Shareholder Return (TSR) performance of the Company’s shares for the LTIPs granted in 2005 and have 
advised that AMS’s Total Shareholder Return (TSR) was in the top quartile of performance against the comparator Group and that consequently 
100% of the award has vested. PKF (UK) LLP have confirmed that AMS’s TSR performance for the LTIPs granted in 2007 was in the top quartile of 
performance against the comparator group and that consequently 100% of the award has vested.
Awards made have no performance retesting facility.
Five-Year relative share price performance
For the five year period ending 28 February 2011, Advanced Medical Solutions Group plc’s share price has outperformed the FTSE All Share by 
759%, the FTSE techMARK by 553%, the FTSE Healthcare Index by 844%, the FTSE Small Cap Index by 881% and the FTSE AIM All Share Index  
by 10%.
M a r y T a v e n e r
Company Secretary
20 April 2011
0
200
400
600
800
1000
Feb-11 Aug-10 Feb-10 Aug-09 Feb-09 Aug-08 Feb-08 Aug-07 Feb-07 Aug-06 Feb-06
Advanced Medical Solutions 
FTSE All Share 
FTSE Techmark All Share 
FTSE ALL Share Healthcare 
FTSE Small Cap  
FTSE AIM All Share Advanced Medical Solutions Group
32   Advanced Medical Solutions Group plc Annual Report 2010
Corporate Governance
The Board is committed to the principles of corporate governance 
and, although as an AIM quoted Company is not bound by the 
Combined Code, the directors have applied the Combined Code in a 
manner which it considers appropriate for the size of the Group. The 
directors have highlighted below where the Group has not applied the 
UK Combined Code.
The Board of Directors
The Board retains full and effective control of the Group and has a 
schedule of matters specifically reserved for its decision. The Board 
meets on a formal basis regularly, and met formally 18 times in 2010. 
All of the directors attended all of the meetings that they were eligible 
to attend. Prior to each Board Meeting, directors are sent  
an agenda including reports from the Executive Directors, monthly 
management accounts and forecasts, and reports on Health and 
Safety. Additionally, the Board is responsible for formulating the 
Group’s corporate strategy, approval of budgets, monitoring financial 
performance, approval and review of major capital expenditure, 
corporate governance and risk management. Operational control is 
delegated to the Executive Directors and the Senior Management 
Team (SMT). The SMT meets monthly. All directors have access to the 
advice and services of the Company Secretary and can take 
independent professional advice, if necessary, at the Group’s expense. 
The Non-Executive Directors are able to contact the Executive 
Directors at any time for further information.
In 2010 the Board consisted of three Executive Directors and three 
Non-Executive Directors. The Chairman is considered by the Company 
to be one of the Non-Executive Directors and there is a clear division 
of responsibility between the Chairman and the Chief Executive. Two 
of the Non-Executive Directors are considered to be independent and 
independent of the executive management. The Chairman during the 
year, Geoffrey Vernon, having served longer than ten years on the 
Board, was no longer considered independent. He retired from the 
Board on 31 December 2010 and was replaced by Don Evans who 
became Non-Executive Chairman having been the Chief Executive 
Officer of the Group. Don Evans is not considered to be an 
independent Non-Executive. In 2010 the Board had at least two 
independent Non-Executive Directors which for smaller companies  
is in compliance with the Code.
The Board is aware that appointing the Chief Executive Officer to the 
role of Chairman does not comply with the independence criteria 
specified in A.3.1. of the Code. However, having set out the criteria 
required from the role of Chairman as the Group moves through to its 
next stage of growth, the Board believed that the decision was in the 
best interests of its shareholders. Don Evans’ considerable experience 
in the sector and with the Group significantly outweighed any 
disadvantages that his lack of independence might bring when the 
independence of the Non-Executive Directors is taken into account. 
The opinions of major shareholders and advisors were sought in 
advance of this decision being taken. Don Evans was not involved  
in the Board decision surrounding his appointment.
All directors are required to stand for re-election at the first Annual 
General Meeting following their appointment and, as a minimum, 
every three years thereafter. Don Evans will be standing for re-election 
at the next AGM and, because he is deemed not to be independent, 
every year thereafter.
All of the Non-Executive Directors are able to discuss matters without 
the Executive Directors present.
The Board formally evaluates its performance annually. Each director 
completes a comprehensive questionnaire. The results are collated 
and discussed by the Board. The Board then acts on the findings. As a 
result of formal feedback from advisors, investors and analysts the 
Board decided to appoint a Senior Independent Director (SID) and 
Penny Freer was appointed to the Board as SID on 1 March 2010.
The Company arranges appropriate insurance cover in respect of legal 
action taken against its directors.
Board Committees
The Board has delegated specific authority to the Remuneration 
Committee, Nominations Committee and the Audit Committee.
The Non-Executives are the only members of the Remuneration and 
Audit Committees.
The Audit Committee is chaired by Steve Bellamy, a qualified 
Chartered Accountant and met three times in 2010. The Audit 
Committee has Terms of Reference which are regularly reviewed. The 
Committee considers the appointment, fees and independence of the 
auditors and discusses the scope of the audit and its findings. It is also 
responsible for monitoring the Group’s accounting policies, reviewing 
the Group’s assessment of business risks and internal controls to 
mitigate these risks as well as reviewing the annual and interim 
statements prior to their submission for approval by the Board. It is 
also responsible for reviewing the Company’s Whistleblowing and 
Fraud policies, and reviewing the Company’s need for an internal audit 
function. The Committee has the right of access to the external 
auditors without the attendance of the Executive Directors and does 
so regularly.
In 2011, as Don Evans was not independent upon appointment  
as Chairman, his membership of the Audit Committee is not in 
compliance with the Corporate code. As a smaller company, 
Advanced Medical Solutions is, however, only required to have  
two, independent Non-Executives on its Audit Committee.
The Audit Committee also undertakes a formal assessment of the 
auditor’s independence which includes:
A review of non-audit services provided to the Group and • 
related fees.
Discussion with the auditor of a written report detailing all • 
relationships with the Company and any other parties that could 
affect independence or the perception of independence.
A review of the auditor’s own procedures for ensuring the • 
independence of the audit firm and partners and staff involved  
in the audit, including the regular rotation of the audit partner.
Obtaining written confirmation from the auditor that, in its • 
professional judgement, it is independent.
An analysis of the fees payable to the external audit firm in respect • 
of both the audit and non-audit services during the year, which is 
set out in note 7 of the financial statements. 33 Advanced Medical Solutions Group plc Annual Report 2010  
The Remuneration Committee is chaired by Penny Freer and, in 
consultation with the Chief Executive, determines the Group’s policy 
on executive remuneration, employment conditions, and the 
individual remuneration packages of Executive Directors and senior 
management earning in excess of £75,000 per annum. In 2011, The 
Terms of Reference will require the remuneration of all senior 
management reporting to the Executive Directors and staff with 
remuneration packages of £100,000 or more to be approved by the 
Remuneration Committee. It also approves all new incentive schemes, 
the grants of options under the Group’s Share Option Schemes, and 
the grant of shares under the Group's Long Term Incentive Plan (LTIP). 
The Remuneration Committee met six times in 2010. Its report is 
included on pages 29 to 31.
In 2011, as Don Evans was not independent upon appointment as 
Chairman, his membership of the Remuneration Committee is not  
in compliance with the Combined Code. As a smaller company, 
Advanced Medical Solutions is however, only required to have  
two independent Non-Executive Directors on its Remuneration 
Committee.
The Nominations Committee nominates and recommends the 
appointment of new directors to the Board, considers succession 
planning for directors and other senior management and membership 
of the Audit and Remuneration Committees in consultation with the 
Chairman of the Committees. In making recommendations, the 
Committee takes into account the balance of skill, knowledge and 
experience of the Board. The Committee is chaired by the Chairman 
of the Group and comprises the Non-Executive Directors and the 
Chief Executive Officer. The Nominations Committee met three times 
in 2010. In addition to the full Nominations Committee meeting once  
to discuss the succession plans of the Group, the non-compromised 
directors of the Nominations Committee met twice to discuss the 
Chairmanship role. In particular, the Chairman did not chair the 
Nominations Committee when dealing with the appointment of  
his successor. The Senior Independent Director chaired the 
Nominations Committee instead.
In 2011, Don Evans will be Chairman of the Nominations Committee. 
This will not be in compliance with the Combined Code.
Investor Relations
The Group maintains a regular dialogue with its shareholders, mainly 
in the periods following the announcement of the interim and final 
results, but also at other times during the year. The views of 
shareholders are sought through direct contact and from feedback 
from advisors and are communicated to the Board as a whole.  
The Board encourages the participation of shareholders at its  
annual general meeting, notice of which is sent to shareholders  
at least 20 working days before the meeting. The AMS website  
‘www.admedsol.com’ is regularly updated and provides additional 
information on the Group, including information of the Group’s 
products and technology.
The Company proposes separate resolutions for each separate issue 
and specifically relating to the reports and accounts. The Company 
ensures all proxy votes are counted and indicates the level of 
abstentions it has received after each resolution has been dealt  
with on a show of hands.
Internal Control
The Board is responsible for the Group’s system of internal control and 
for reviewing its effectiveness, taking guidance from the Audit 
Committee. In the context of the Group’s business any such system can 
only reasonably be expected to manage rather than eliminate risks 
arising from its operations. It can therefore only provide reasonable and 
not absolute assurance against material loss or misstatement.
Key features of the internal control system are as follows:
The Group has an organisational structure with clearly established • 
responsibilities and lines of accountability. The Group promotes  
the values of integrity and professionalism. The member’s of the 
Board are available to hear, in confidence, any individuals concerns 
about improprieties.
The Board has a schedule of matters expressly reserved for its • 
consideration. This schedule includes potential acquisitions, major 
capital projects, treasury, risk management policies, approval of 
budgets and health and safety.
An ongoing risk management process has been implemented • 
which identifies the key business risks facing the Group including 
both financial and operational risks. This process, the key business 
risks identified and the controls to mitigate the risks are reviewed 
by the Board at least twice a year.
The controls in place to minimise the occurrence of the risk are • 
documented and analysed for effectiveness. These include 
procedures for the approval of major expenditure or commitment 
of resources.
The Board monitors the activities of the Group through the • 
management accounts, monthly forecasts and other reports  
on current activities and plans. The Senior Management Team 
regularly monitors financial and operational performance in detail 
and takes any necessary corrective action.
The Group operates a ‘whistle-blowing’ policy enabling any • 
individual with a concern to approach the independent  
Non-Executive Directors in confidence.
The Board reviews and continues to review the effectiveness of the 
Group’s procedure in managing risk and, therefore, believes it meets 
the requirements of the Combined Code.
The Audit Committee has considered the need for an internal audit 
resource. It is of the opinion that, given the size and nature of the 
Group’s operations and the other controls in place, it would not be 
appropriate at the present time. The matter is formally reviewed at 
least annually. The external auditors have been engaged to review the 
Group’s risk management process and the controls in place to mitigate 
the risk. This review is ongoing. Preliminary feedback has been provided 
to the Audit Committee on the work carried out to date.
The Group also calls on the services of external bodies to review the 
controls in certain areas of the Group. The quality assurance systems 
are reviewed by the Group's notified bodies, the British Standards 
Institute (BSI), TUV Product Service and Lloyd’s Quality Register 
Assurance on a regular basis. Advanced Medical Solutions Group
34   Advanced Medical Solutions Group plc Annual Report 2010
Corporate Governance continued
Going Concern
In carrying out their duties in respect of going concern, the directors have 
carried out a review of the Group’s financial position and cash flow 
forecasts for the next 12 months. This includes a comprehensive review of 
revenue, expenditure and cash flows, taking into account specific business 
risks and the current economic environment.
With regards to the Group’s financial position, it had cash and cash 
equivalents at the year-end of £4.1 million. The Group also has in place 
a revolving credit facility of £5 million inclusive of a £1 million 
overdraft facility which expires in July 2012 and which was unutilised 
at the end of the year.
While the current economic environment is uncertain, AMS operates 
in a market whose demographics are extremely favourable, 
underpinned by an increasing need for products to treat chronic and 
acute wounds. Consequently, strong market growth is predicted. The 
Group has a number of long-term contracts with customers across 
different geographic regions and also with substantial financial 
resources, ranging from government agencies through to global 
healthcare companies.
Having taken the above into consideration the directors have reached 
the conclusion that the Group is well placed to manage its business 
risks in the current economic environment. Accordingly, they continue 
to adopt the going concern basis in preparing the financial statements.
By order of the Board
M a r y T a v e n e r
Company Secretary
20 April 2011 35 Advanced Medical Solutions Group plc Annual Report 2010  
Independent Auditor’s Report to the members of 
Advanced Medical Solutions Group plc
We have audited the financial statements of Advanced Medical Solutions Group plc for the year ended 31 December 2010, which comprise  
the Consolidated Income Statement, the Consolidated Statement of Comprehensive Income, the Consolidated Statement of Financial Position, 
the Consolidated Statement of Cash Flows, the Consolidated Statement of Changes in Equity, the Company Balance Sheet, the related 
consolidated notes 1 to 36 and the related Company notes 1 to 8. The financial reporting framework that has been applied in the preparation  
of the Group financial statements is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union.  
The financial reporting framework that has been applied in the preparation of the parent company financial statements 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 Directors’ Responsibilities Statement, the directors are responsible for the preparation of the financial statements 
and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in 
accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing 
Practices Board’s 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 and 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.
Opinion on financial statements
In our opinion:
the financial statements give a true and fair view of the state of the Group’s and of the parent company’s affairs as at 31 December 2010 and • 
of the Group’s profit for the year then ended;
the Group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union; • 
the parent company financial statements have been properly prepared in accordance with United Kingdom Generally Accepted Accounting • 
Practice; and
the financial statements 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 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. • 
William Smith (Senior Statutory Auditor)
for and on behalf of Deloitte LLP
Chartered Accountants and Statutory Auditor
Manchester, United Kingdom 
20 April 2011 Advanced Medical Solutions Group
36   Advanced Medical Solutions Group plc Annual Report 2010
Consolidated Income Statement
For   t he   y e a r   ended   3 1   Decem ber   2 0 1 0
 Year ended 31 December 2010 
|||||||| |
 Year ended 31 December 2009
   Before Exceptional  Before Exceptional  
   exceptional items  exceptional items  
   items (note 6) Total items (note 6) Total  
  Note £’000 £’000 £’000 £’000 £’000 £’000
Revenue from continuing operations  4 31,881 – 31,881 24,091 – 24,091
Cost of sales   (17,144) – (17,144) (12,482) – (12,482)
Gross profit   14,737 – 14,737 11,609 – 11,609
Distribution costs   (307) – (307) (157) – (157)
Administration costs   (9,263) (1,001) (10,264) (7,799) (1,672) (9,471)
Other income   173 – 173 488 – 488
Share of result of joint venture   – – – (66) – (66)
Profit from operations   4,5 5,340 (1,001) 4,339 4,075 (1,672) 2,403
Finance income  11 12 – 12 21 – 21
Finance costs  12 (60) – (60) (30) – (30)
Profit before taxation    5,292 (1,001) 4,291 4,066 (1,672) 2,394
Income tax  13 542 – 542 390 – 390
Profit for the year attributable to equity  
holders of the parent    5,834 (1,001) 4,833 4,456 (1,672) 2,784
Earnings per share
Basic  15 3.83p (0.66)p 3.17p 3.09p (1.16)p 1.93p
Diluted  15 3.77p (0.65)p 3.12p 2.87p (1.08)p 1.79p
The above results relate to continuing operations.
Consolidated Statement of Comprehensive Income
For   t he   y e a r   ended   3 1   Decem ber   2 0 1 0
       Year ended Year ended 
       31 December  31 December 
       2010 2009 
       £’000 £’000
Profit for the year       4,833 2,784
Exchange differences on translation of foreign operations       (257) (153)
Loss arising on cash flow hedges       (76) (26)
Other comprehensive expense for the year       (333) (179)
Total other comprehensive income for the year attributable to equity holders of the parent    4,500 2,605 37 Advanced Medical Solutions Group plc Annual Report 2010  
Consolidated Statement of Financial Position 
A t   3 1   Decem ber   2 0 1 0
       2010 2009 
      Note £’000 £’000
Assets
Non-current assets
Acquired intellectual property rights      16 1,062 1,230
Software intangibles      16 16 34
Development costs      16 771 725
Goodwill      20 2,878 2,978
Property, plant and equipment      17 12,828 10,284
Deferred tax assets      18 2,756 2,422
Trade and other receivables       19 6
       20,330 17,679
Current assets
Inventories      21 2,498 3,179
Trade and other receivables      22 6,035 6,945
Cash and cash equivalents      23 4,122 1,992
       12,655 12,116
Total assets       32,985 29,795
Liabilities
Current liabilities
Trade and other payables      24 3,798 5,887
Other taxes payable       424 463
Other loans      25 18 18
Obligations under finance leases      25 19 16
       4,259 6,384
Non-current liabilities
Trade and other payables      24 677 278
Other loans      26 226 244
Obligations under finance leases      26 23 39
       926 561
Total liabilities       5,185 6,945
Net assets       27,800 22,850
Equity
Share capital      31 7,740 7,248
Share premium       306 99
Share-based payments reserve       442 502
Investment in own shares      32 (37) (27)
Share-based payments deferred tax reserve       397 576
Other reserve      32 1,531 1,531
Translation reserve       (85) 248
Retained earnings       17,506 12,673
Equity attributable to equity holders of the parent       27,800 22,850
The financial statements on pages 36 to 66 were approved by the Board of Directors and authorised for issue on 20 April 2011 and were signed 
on its behalf by:
C h r i s M e r e d i t h
Chief Executive Officer
20 April 2011 Advanced Medical Solutions Group
38   Advanced Medical Solutions Group plc Annual Report 2010
Consolidated Statement of Changes in Equity
A t t ri bu t a b l e   to   eq u i t y   hol der s   of   t he   Grou p
     Share-     
   Share- Investment based     
 Share Share based in own payments  Other  Retained  
 capital premium payments shares deferred tax reserve Translation earnings Total 
 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
At 1 January 2009  7,169 23 300 (18) 571 1,531 427 9,889 19,892
Share-based payments – – 202 – 5 – – – 207
Issue of share capital 8 – – – – – – – 8
Share options exercised 71 76 – – –  – – 147
Shares purchased by EBT – – – (114) – – – – (114)
Shares sold by EBT – – – 105 – – – – 105
Exchange differences on translation  
 of foreign operations  – – – – – – (153) – (153)
Movement on cash flow hedges – – – – – – (26) – (26)
Consolidated profit for the year  
 to 31 December 2009 – – – – – – – 2,784 2,784
At 31 December 2009 7,248  99 502 (27) 576 1,531 248 12,673 22,850
Share-based payments – – 282 – – – – – 282
Issue of share capital  5 – – – – – – – 5
Share options exercised 487 207 (342) – (179) – – – 173
Shares purchased by EBT – – – (191)  – – – – (191)
Shares sold by EBT – – – 181 – – – – 181
Exchange differences on translation  
 of foreign operations  – – – – – – (257) – (257)
Movement on cash flow hedges – – – – – – (76) – (76)
Consolidated profit for the year  
 to 31 December 2010 – – – – – – – 4,833 4,833
At 31 December 2010 7,740 306 442 (37) 397 1,531 (85) 17,506 27,800 39 Advanced Medical Solutions Group plc Annual Report 2010  
Consolidated Statement of Cash Flows
For   t he   y e a r   ended   3 1   Decem ber   2 0 1 0
       Year ended Year ended 
       31 December 31 December 
       2010 2009 
      Note £’000 £’000
Cash flows from operating activities
Profit from operations       4,339 2,403
A d j u s t m e n t s f o r :
Share of results of joint venture       – 66
Depreciation       1,077 678
Amortisation – intellectual property rights       168 168
  – development costs        121 96
  – software intangibles       23 26
Decrease/(increase) in inventories       676 (826)
Decrease/(increase) in trade and other receivables       880 (1,583)
(Decrease)/increase in trade and other payables       (502) 826
Share-based payments expense       282 202
Net cash inflow from operating activities       7,064 2,056
Cash flows from investing activities   
Purchase of software       (5) (20)
Capitalised research and development       (167) (301)
Purchases of property, plant and equipment       (3,685) (6,735)
Movements in investments in money market deposits       – 5,730
Interest received       12 74
Acquisition of subsidiary      33 (1,255) (69)
Movement in loans and receivables       – (711)
Net cash used in investing activities       (5,100) (2,032)
Cash flows from financing activities   
Finance lease repayments and interest       (19) (17)
Repayment of secured loan       (18) (17)
Issue of equity shares       359 155
Shares purchased by EBT       (191) (114)
Shares sold by EBT       181 105
Interest paid       (54) (30)
Net cash from financing activities       258 82
Net increase in cash and cash equivalents       2,222 106
Cash and cash equivalents at the beginning of the year      1,992 1,882
Effect of foreign exchange rate changes       (92) 4
Cash and cash equivalents at the end of the year       4,122 1,992 Advanced Medical Solutions Group
40   Advanced Medical Solutions Group plc Annual Report 2010
Notes Forming Part of the Consolidated  
Financial Statements
1. Reporting entity
 Advanced Medical Solutions Group plc (‘the Company’) is a public limited company incorporated and domiciled in England and Wales 
(registration number 2867684). The Company’s registered address is Premier Park, 33 Road One, Winsford Industrial Estate, Cheshire, CW7 3RT.
The Company’s ordinary shares are traded on the Alternative Investment Market of the London Stock Exchange. The consolidated financial 
statements of the Company for the twelve months ended 31 December 2010 comprise the Company and its subsidiaries (together referred  
to as the ‘Group’).
The Group is primarily involved in the design, development and manufacture of novel high performance polymers (both natural and synthetic) 
for use in advanced woundcare dressings and materials, and medical adhesives, for closing and sealing tissue, for sale into the global medical 
device market.
2. Basis of preparation
The Group accounts have been prepared under International Financial Reporting Standards (IFRSs) as adopted by the EU. 
The financial statements have been prepared on the historical cost basis of accounting except as disclosed in the accounting policies set 
out below.
The individual financial statements for each Group company are presented in the currency of the primary economic environment in which it 
operates (its functional currency). For the purpose of the consolidated financial statements, the results and financial position of each Group 
company are expressed in pounds sterling, which is the functional currency of the Company, and the presentation currency for the consolidated 
financial statements.
After making enquiries and on the basis outlined in the corporate governance section on page 34 the directors have a reasonable expectation 
that the Group has adequate resources to continue in operational existence for the foreseeable future and for this reason they continue to adopt 
the going concern basis in preparing the accounts.
The Group has applied IFRS 3 ‘Business Combinations’ (revised 2008) and IAS 27 ‘Consolidated and Separate Financial Statements’ (revised 2008). 
These have had no impact on this set of financial information.
3. Accounting policies
Use of estimates and judgments
The preparation of financial statements requires management to make judgments, estimates and assumptions that affect the application of 
accounting policies and the reported amounts of assets, liabilities, income and expense. Actual results may differ from these estimates. 
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which 
the estimate is revised and in any future periods affected. 
I m p a ir m e n t o f g o o d w ill
Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to which the assets have been 
allocated. The value in use calculation requires the Group to estimate the future cash flows expected to arise from the cash-generating unit 
(estimated at 20 years) and a suitable discount rate to calculate present value.
C a p i t a li s a t i o n o f d e v e l o p m e n t c o s t s
In determining the development expenses to be capitalised, estimates and assumptions are required based on expected future economic 
benefits generated by products that are the result of these development costs. Other important estimates and assumptions in this assessment 
process are the required internal rate of return, the distinction between research and development and the estimated useful life.
Sh a r e - b a s e d p a y m e n t s
The charge to the income statement in relation to options and incentive plans is based on the Black-Scholes Merton or the Binominal Theorem 
valuation technique. This technique requires a number of assumptions to be made such as those in relation to share price volatility, movement in 
interest rates, dividend yields and staff behavioural patterns.
I n v e n t o r y im p a ir m e n t p r o v i s i o n s
The Group makes provisions for inventory deemed to be obsolete or slow-moving. This provision is established on each individual stock keeping 
unit based on the age of the stock, the forward order book, management’s experience and its assessment of the present value of estimated 
future cash flows.
R e c e i v a b l e s im p a ir m e n t p r o v i s i o n s
The amounts presented in the balance sheet are net of allowances for doubtful receivables, estimated by the Group’s management based on 
prior experience and their assessment of the present value of estimated future cash flows.
D e f e r r e d t a x
A deferred tax asset is recognised when it is judged probable that the Group will generate taxable profits which can be offset against tax losses. 41 Advanced Medical Solutions Group plc Annual Report 2010  
3. Accounting policies continued
Basis of consolidation
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power to govern the financial and operating policies  
of an entity so as to retain benefits from its activities. The financial statements of the subsidiaries are included in the consolidated financial 
statements on the basis of acquisition accounting, from the date that control commences until the date that control ceases.
Intercompany transactions and balances between Group entities are eliminated upon consolidation.
Business combinations
The acquisition of subsidiaries is accounted for using the purchase method. The cost of the acquisition is measured at the aggregate of the fair 
values, at the date of exchange, of assets given, liabilities incurred or assumed, the equity instruments issued by the Group in exchange for 
control of the acquiree, plus any costs directly attributable to the business combination. The acquiree’s identifiable assets, liabilities and 
contingent liabilities that meet the conditions for recognition under IFRS 3 are recognised at their fair value at the acquisition date, except for 
non-current assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 ‘Non-Current Assets Held for Sale and 
Discontinued Operations’, which are recognised and measured at fair value less costs to sell.
Goodwill arising on acquisition is recognised as an asset and initially measured at cost, being the excess of the cost of the business combination 
over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised. If, after reassessment, the 
Group’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities exceeds the cost of the business 
combination, the excess is recognised immediately in profit or loss.
Goodwill
Goodwill arising on consolidation represents the excess of the cost of acquisition over the Group’s interest in the fair value of the identifiable 
assets and liabilities of a subsidiary, associate or jointly controlled entity at the date of acquisition. Goodwill is initially recognised as an asset at 
cost and is subsequently measured at cost less any accumulated impairment losses. Goodwill which is recognised as an asset is reviewed for 
impairment at least annually. Any impairment is recognised immediately in profit or loss and is not subsequently reversed.
Revenue recognition
Revenue represents the fair value of sales of the Group’s products to external customers at amounts excluding value added tax, and is 
recognised when the products have been delivered and title has passed. Revenue is recognised to the extent that it is probable that the 
economic benefits will flow to the Group and the revenue can be reliably measured. 
Revenue from royalty income receivable under licence agreements from external customers at amounts excluding value added tax is recognised 
as the products under licence are sold and the revenue can be reliably measured. 
Other Income
This represents non-refundable up-front licence payments received for the grant of rights for the development and marketing of products, and 
other sundry income. The income is recognised in the income statement, over the life of each development project, in proportion to the stage 
of completion of each project when the outcome of each stage of completion can be assessed with reasonable certainty.
Finance Income
Finance income relates to interest earned on cash, cash equivalents and investments. Interest income is accrued on a time basis, by reference to 
the principal outstanding and at the effective interest rate applicable.
Finance Costs
Finance costs relate to finance payments associated with financial liabilities. They are recognised in the income statement as they accrue using 
the effective interest method.
Finance costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a 
substantial period of time to get ready for their intended use, are added to the cost of those assets, until such time as the assets are substantially 
ready for their intended use.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from 
the borrowing costs eligible for capitalisation.
Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an  
outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the  
amount of the obligation. Advanced Medical Solutions Group
42   Advanced Medical Solutions Group plc Annual Report 2010
3. Accounting policies continued
Foreign currencies
Transactions in foreign currencies are translated at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities 
denominated in foreign currencies at the balance sheet date are translated at the foreign exchange rate ruling at that date. Foreign exchange 
differences arising on translation are recognised in the income statement. Non-monetary assets and liabilities that are measured in terms of historical 
cost in a foreign currency are translated using the exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated in 
foreign currencies that are stated at fair value are translated at foreign exchange rates ruling at the date the fair value was determined.
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on consolidation, are translated at foreign 
exchange rates ruling at the balance sheet date. The revenue and expenses of foreign operations are translated at an average rate for the year 
where this rate approximates to the foreign exchange rates at the dates of the transactions. Exchange differences arising on consolidation are 
recognised in equity.
Taxation
Taxation expense includes the amount of current income tax payable and the charge for the year in respect of deferred taxation.
The income tax payable is based on an estimation of the amount due on the taxable profit for the year. Taxable profit is different from profit 
before tax as reported in the income statement because it excludes items of income or expenditure which are not taxable or deductible in the 
year as a result of either the nature of the item or the fact that it is taxable or deductible in another period. The Group’s liability for current tax is 
calculated by using tax rates that have been enacted or substantively enacted by the balance sheet date.
Deferred tax is accounted for on a basis of temporary differences, except where it arises from the initial recognition of goodwill or of an asset or 
liability in a transaction that is not a business combination. Deferred tax assets are recognised only to the extent that it is probable that future 
taxable profits will be available against which temporary differences can be utilised.
Deferred tax is charged or credited to the income statement, except when it relates to items charged or credited directly to equity, in which 
case it is dealt with within equity. It is calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability 
is settled based on tax laws enacted or substantively enacted by the balance sheet date.
Intangible assets
A c q u ir e d in t e ll e c t u a l p r o p e r t y r i g h t s
Intellectual property rights that are acquired in a business combination are initially recognised at their fair value. Intellectual property rights 
purchased outright are initially recognised at cost. Intellectual property rights are capitalised and amortised over their estimated useful 
economic lives, usually not exceeding 18 years. In determining the useful economic life, each asset is reviewed separately and consideration 
given to the period over which the Group expects to derive economic benefit from the asset.
D e v e l o p m e n t c o s t s
Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge, is recognised in the income 
statement as an expense in the period in which it is incurred.
Expenditure on development activities, where research findings are applied to a plan or design for the production of new or substantially 
improved products and processes, is capitalised once it can be demonstrated that the product or process is clearly identifiable, technically  
and commercially feasible, will generate future economic benefits, that the development costs of the asset can be measured reliably and  
that the Group has sufficient resources to complete development. Expenditure capitalised is stated as the cost of materials and direct labour  
less accumulated amortisation.
Where development expenditure results in new or substantially improved products or processes and it is probable that recovery will take place, it 
is capitalised and amortised on a straight-line basis over the product’s useful life, starting from the date on which serial production commences, 
which is between one and ten years. Patents and trademarks are measured initially at purchase cost and are amortised on a straight-line basis 
over their estimated useful lives, which is between three and twenty years.
S o f t w a r e in t a n g ib l e s
Where computer software is not integral to an item of property, plant or equipment its costs are capitalised and categorised as intangible assets. 
Amortisation is provided on a straight-line basis over its economic useful life, which is in the range of three to five years.
Notes Forming Part of the Consolidated  
Financial Statements continued 43 Advanced Medical Solutions Group plc Annual Report 2010  
3. Accounting policies continued
Property, plant and equipment
Land and buildings and plant and equipment held for use in the production of goods and services or for administrative purposes are carried in 
the balance sheet at cost less any subsequent accumulated depreciation and subsequent accumulated impairment losses.
The Group elected to use the fair value as the deemed cost in respect of land and buildings at the date of transition to IFRS. Fair value was 
calculated by reference to their existing use at the date of transition.
Depreciation is provided to write off the cost, less estimated residual values, of all property, plant and equipment over the expected useful life  
of the asset from the date that the asset is brought into use. It is calculated at the following rates:
• Freehold property and improvements  – 4% per annum on cost
• Leasehold improvements    – over the length of the lease
• Plant and machinery   – 6.7% to 33.3% per annum on cost
• Fixtures and fittings   – 33.3% per annum on cost
• Motor vehicles    – 25% per annum on cost
Property, plant and equipment in the course of construction for production are carried at cost, less any recognised impairment loss. 
Depreciation of these assets, on the same basis as other property, plant and equipment assets, commences when the assets are ready for their 
intended use.
No depreciation is provided on freehold land.
Impairment of tangible and intangible assets excluding goodwill
The carrying amount of the Group’s assets other than inventories and deferred tax assets are reviewed at each balance sheet date to determine 
whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated.
An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. 
Impairment losses are recognised in the income statement.
Impairment losses recognised in respect of cash-generating units are allocated to reduce the carrying amount of the 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.
R e v e r s a l o f im p a ir m e n t
An impairment loss in respect of a receivable carried at amortised cost is reversed if the subsequent increase in recoverable amount can be 
related objectively to an event occurring after the impairment loss was recognised.
In respect of other assets, an impairment loss is reversed when there is an indication that the impairment loss may no longer exist and there has 
been a change in the estimates used to determine the recoverable amount.
An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been 
determined, net of depreciation or amortisation, if no impairment loss had been recognised.
Inventory
Inventory is valued at the lower of cost or net realisable value. Cost comprises direct materials and, where applicable direct labour costs and 
those overheads that have been incurred in bringing the inventories to their present location and condition.
Net realisable value is based on estimated selling price less further costs to completion and disposal.
The Group makes provision for inventory deemed to be irrecoverable or where the net realisable value is lower than cost. This provision is 
established on a stock keeping unit basis by reference to the age of the stock, the forward order book, management’s experience and its 
assessment of the present value of estimated future cash flow. Advanced Medical Solutions Group
44   Advanced Medical Solutions Group plc Annual Report 2010
3. Accounting policies continued
Financial Instruments
C l a s s i fi c a t i o n o f fi n a n c i a l in s t r u m e n t s
Financial instruments are classified as financial assets, financial liabilities or equity instruments.
Financial instruments issued by the Group are treated as equity only to the extent that they meet the following two conditions:
they include no contractual obligations upon the Group to deliver cash or other financial assets that are potentially unfavourable to the • 
Group; and 
 where the instrument will or may be settled in the Group’s own equity instruments, it is either a non-derivative that includes no obligation to • 
deliver a variable number of the Group’s own equity instruments or is a derivative that will be settled by the Group exchanging a fixed amount 
of cash or other financial assets for a fixed number of its own equity instruments.
To the extent that this definition is not met, the proceeds of issue are classified as a financial liability. 
R e c o g n i t i o n a n d v a l u a t i o n o f fi n a n c i a l a s s e t s
C a s h a n d c a s h e q u i v a l e n t s
Cash and cash equivalents comprise cash at bank and in hand and cash deposits and amounts under short-term guarantees (usually three 
months or less) that are held for the purpose of meeting short-term cash commitments, are subject to insignificant risk in change in value and 
that are readily convertible to a known amount of cash. 
I nv e s t m e nt s
Cash held in accounts with more than 90 days’ notice that are not required to meet short-term cash commitments are shown as an investment. 
The Group invests funds that are surplus to requirements in fixed rate deposits operating within parameters for credit ratings and credit limits for 
individual institutions that are approved and monitored by the Board.
Under IAS 39 ‘Financial instruments; recognition and measurement’, such investments are classified as loans and receivables and are recognised 
at fair value on initial recognition and subsequently measured at amortised cost using the effective interest method.
T r a d e a n d o t h e r r e c e i v a b l e s
Trade receivables are recognised and carried at the lower of their original invoiced value and recoverable amount. An impairment is made when 
it is likely that the balance will not be recovered in full. The recoverable amount is calculated as the present value of estimated future cash flows. 
Estimated future cash flows are not discounted due to the relatively short period of time between recognition of trade receivables and receipt 
of cash.
R e c o g n i t i o n a n d v a l u a t i o n o f e q u i t y in s t r u m e n t s
Equity instruments are stated at par value. Any premium on issue is taken to the share premium account.
R e c o g n i t i o n a n d v a l u a t i o n o f fi n a n c i a l li a b ili t i e s
Financial liabilities are classified according to the substance of the contractual arrangements entered into.
T r a d e p a y a b l e s
Trade payables are initially recognised at fair value and are subsequently recognised at amortised cost using the effective interest method.
O t h e r l o a n s
Other loans are initially recognised at fair value and are subsequently recognised at amortised cost.
Financial liabilities at Fair Value Through Profit or Loss (‘FVTPL’)
A derivative that is not designated and effective as a hedging instrument is classified as held for trading. Financial liabilities are classified as  
FVTPL where the financial liabilities are held for trading.
Financial liabilities at FVTPL are stated at fair value, with any resultant gain or loss recognised in profit or loss. Fair value is determined in the 
manner described in note 27.
Derivative financial instruments
The Group enters into foreign exchange forward contracts to manage its exposure to foreign exchange rate risk. Further details of derivative 
financial instruments are disclosed in note 27.
Notes Forming Part of the Consolidated  
Financial Statements continued 45 Advanced Medical Solutions Group plc Annual Report 2010  
3. Accounting policies continued
D e r i v a t i v e fi n a n c i a l in s t r u m e n t s continued
Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured to their fair 
value at each balance sheet date. The resulting gain or loss is recognised in profit or loss (included in administrative costs) immediately unless the 
derivative is designated and effective as a hedging instrument, in which event the timing of the recognition in profit or loss depends on the 
nature of the hedge relationship, with any unrealised gain or loss being recognised in equity. The Group currently designates certain derivatives 
as hedges of highly probable forecast transactions or hedges of foreign currency risk of firm commitments (cash flow hedges). A derivative with a 
positive fair value is recognised as a financial asset whereas a derivative with a negative fair value is recognised as a financial liability. 
Derivatives with remaining maturity of less than 12 months are presented as current assets or current liabilities.
Leased assets
Leases are classified as finance leases when the terms of the lease transfer substantially all the risks and rewards of ownership to the Group. All 
other leases are classified as operating leases.
Assets held as finance leases are recognised as assets of the Group at their fair value or, if lower, at the present value of the minimum lease 
payments during the lease term at the inception of the lease. Lease payments are apportioned between the reduction of the lease liability and 
finance charges in the income statement so as to achieve a constant rate of interest on the remaining balance of the liability. Assets held under 
finance leases are depreciated over the shorter of the estimated useful life of the assets and the lease term.
Assets leased under operating leases are not recorded on the balance sheet. Rental payments are charged directly to the income statement. 
Lease incentives, primarily up-front cash payments or rent-free periods, are capitalised and spread over the period of the lease term. Payments 
made to acquire operating leases are treated as prepaid lease expenses and amortised over the life of the lease.
Pensions
The Group operates a money purchase pension scheme. The assets of the scheme are held separately from those of the Group in an 
independently administered fund. The amount charged against the income statement represents the contributions payable to the scheme in 
respect of the accounting period.
Share-based payments
The Group has applied the requirements of IFRS 2 ‘Share-based payment’. IFRS 2 has been applied to all options granted after 7 November 2002 
that were unvested as of 1 January 2006.
The group issues equity-settled share-based payments to certain employees. Equity-settled share-based payments are measured at fair value at 
the date of grant. The fair value as determined at the grant date of equity-settled share-based payments is expensed on a straight-line basis over 
the vesting period, based on the Group’s estimate of options that will eventually vest.
Fair value is measured by use of a Black-Scholes Merton or a Binomial Theorem model. The expected life used in the model has been adjusted, 
based on management’s best estimate, for the effect of non-transferability, exercise restrictions and behavioural considerations.
Capital management
For the years ended 31 December 2009 and 31 December 2010, the Group has had net funds with minimal borrowings. Capital is managed by 
maximising retained profits. Working capital is managed in order to generate maximum conversion of these profits into cash and cash 
equivalents thereby maintaining capital. 
Capital includes share capital, share premium, investment in own shares, share-based payments reserve, share-based payments deferred tax 
reserve, other reserve, translation reserve and retained earnings reserve. There are no externally imposed capital requirements on the Group.
Exceptional items
Exceptional items are those items that are unusual because of their size, nature or incidence, or that the directors consider should be disclosed 
separately to enable a full understanding of the Group’s results. This includes non-recurring aborted transaction costs and site relocation costs 
(see note 6). Exceptional items have been presented separately on the face of the income statement. The directors consider that this 
presentation gives a fairer presentation of the results of the Group.
Employee Benefit Trusts
The Group operates an Employee Benefit Trust (EBT): ‘Advanced Medical Solutions Group plc UK Employee Benefit Trust’.
The Group has de-facto control of the assets, liabilities and shares held by the Trust and bear their benefits and risks. The Group records assets 
and liabilities of the Trust as its own.
In compliance with IAS 32 ‘Financial Instruments: Presentation’, shares held by the EBT are included in the consolidated balance sheet as a 
reduction in equity. Gains and losses on Group shares are recognised directly in reserves. Advanced Medical Solutions Group
46   Advanced Medical Solutions Group plc Annual Report 2010
3. Accounting policies continued
IFRS not yet effective and not adopted early
The following IFRSs have been issued but have not been adopted by the Group in these financial statements as they are not yet effective:
Improvements to IFRS (issued in May 2010) is yet to be endorsed by the EU and contains amendments to several individual accounting standards 
which are effective for accounting periods beginning on or after 1 July 2010 or 1 January 2011. None of the amendments are expected to have  
a significant impact upon the Group’s net results, net assets or disclosures.
IAS 24 ‘Related Party Disclosures’ was revised by the IASB in 2009 and is effective for accounting periods beginning on or after 1 January 2011. 
The changes introduced relate mainly to disclosure requirements for government-related entities, and the definition of a related party, and are 
not expected to have a significant impact on the Group’s disclosures. The revised standard was endorsed by the EU during 2010.
The amendments to IAS 32 ‘Classification of Rights Issues’ (endorsed by the EU in 2009) and IFRS 7 ‘Disclosures – Transfer of Financial Assets’  
and IAS 12 ‘Deferred Tax: Recovery of Underlying Assets’ (not yet endorsed by the EU) are effective for accounting periods beginning or after  
1 February 2010, 1 July 2011 and 1 January 2012 respectively. They are not expected to have a significant impact upon the Group’s net results, 
net assets or disclosures.
The following IFRS Interpretations Committee (IFRIC) amendments and interpretations have been issued but are not yet adopted by the Group:
Amendments to IFRIC 14 ‘Prepayments of a Minimum Funding Requirement’; and • 
IFRIC 19 ‘Extinguishing Financial Liabilities with Equity Instruments’. • 
The amendments and interpretations are effective for accounting periods commencing on or after 1 January 2011 and 1 July 2010 respectively. 
None of the amendments or interpretations are expected to have a significant impact upon adoption.
Unless otherwise listed above, no other standard, amendment or interpretation is likely to have a material effect on the Group’s results, 
operations or financial position.
4. Segment information
For management purposes, the Group is organised into two business units, advanced woundcare and wound closure and sealants. These 
divisions are the basis on which the Group reports its segment information.
Inter-segment pricing is determined on an arm’s length basis.
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable 
basis. Unallocated items comprise mainly investments, and related revenue, corporate assets, head office expenses and income tax assets.  
These are the measures reported to the Group’s Chief Executive Officer for the purposes of resource allocation and assessment of segment 
performance.
Business segments
The principal activities of the advanced woundcare business unit are the research, development, manufacture and distribution of novel, high 
performance polymers for use as wound dressings.
The principal activities of the wound closure and sealants business unit are the research, development, manufacture and distribution of medical 
adhesives and products for closing and sealing tissue.
Segment information about these businesses is presented below. 
          
      Wound 
      Advanced closure    
     woundcare & sealants Eliminations Consolidated 
Year ended 31 December 2010     £’000 £’000 £’000 £’000
Revenue    
External sales     25,197 6,684 – 31,881
Inter-segment sales     – – – –
Total revenue     25,197 6,684 – 31,881
Result
Segment result     3,735 1,620 – 5,355
Unallocated expenses        (1,016)
Profit from operations        4,339
Finance income        12
Finance costs        (60)
Profit before tax        4,291
Tax        542
Profit for the year        4,833
Notes Forming Part of the Consolidated  
Financial Statements continued 47 Advanced Medical Solutions Group plc Annual Report 2010  
4. Segment information continued
      Wound 
     Advanced closure    
At 31 December 2010     woundcare & sealants Eliminations Consolidated 
Other Information     £’000 £’000 £’000 £’000
Capital additions:
Software intangibles      5 1 – 6
Research and development     162 5 – 167
Property, plant and equipment     3,514 144 – 3,658
Depreciation and amortisation     1,021 369 – 1,390
Balance sheet
Assets
Segment assets     25,856 6,053 – 31,909
Unallocated assets        1,076
Consolidated total assets        32,985
Liabilities    
Segment liabilities     3,946 944 – 4,890
Unallocated liabilities        295
Consolidated total liabilities        5,185
The advanced woundcare segment’s results include £1,001,000 of exceptional expenditure in respect of the site move.
      Wound 
     Advanced closure    
     woundcare & sealants Eliminations Consolidated 
Year ended 31 December 2009     £’000 £’000 £’000 £’000
Revenue
External sales     19,391 4,700 – 24,091
Inter-segment sales     43 –  (43) –
Total revenue     19,434 4,700 (43) 24,091
Inter-segment sales are charged at prevailing market prices.
Result
Segment result     3,492 801 – 4,293
Unallocated expenses        (1,890)
Profit from operations        2,403
Finance income        21
Finance costs        (30)
Profit before tax        2,394
Tax        390
Profit for the year        2,784
      Wound 
     Advanced closure    
At 31 December 2009     woundcare & sealants Eliminations Consolidated 
Other Information     £’000 £’000 £’000 £’000
Capital additions:
Software intangibles     10 10 – 20
Research and development     297 4 – 301
Property, plant and equipment     6,570 165 – 6,735
Depreciation and amortisation     626 342 – 968
Balance sheet
Assets
Segment assets     22,868 5,710 – 28,578
Unallocated assets        1,217
Consolidated total assets        29,795
Liabilities
Segment liabilities     4,413 988 – 5,401
Unallocated liabilities        1,544
Consolidated total liabilities        6,945 Advanced Medical Solutions Group
48   Advanced Medical Solutions Group plc Annual Report 2010
4. Segment information continued
Exceptional items of £909,000 incurred in respect of the site move are also included within the advanced woundcare segment.
Exceptional items of £763,000 incurred in respect of the aborted transaction are included in unallocated expenses.
Geographical segments
The advanced woundcare and wound closure and sealants segments operate mainly in the UK, with a sales office located in the USA. In 
presenting information on the basis of geographical segments, segment revenue is based on the geographical location of customers. Segment 
assets are based on the geographical location of the assets.
The following table provides an analysis of the Group’s sales by geographical market, irrespective of the origin of the goods/services, based upon 
location of the Group’s customers:
       Year ended Year ended 
       31 December 31 December 
        2010 2009 
       £’000 £’000
United Kingdom       8,323 7,268
Europe excluding United Kingdom       13,819 10,269
United States of America       9,154 5,888
Rest of World       585 666
       31,881 24,091
All assets are classified as under the United Kingdom with the exception of assets held in The Netherlands of £2,555,000; the carrying value of 
assets held in the United States of America is immaterial.
5. Profit from operations
       Year ended Year ended 
       31 December 31 December 
       2010 2009 
        £’000 £’000
Profit from operations is arrived at after charging/(crediting):
Depreciation of property, plant and equipment       1,077 678
Amortisation of: 
– acquired intellectual property rights       168 168
– software intangibles       23 26
– development costs       121 96
Operating lease rentals – plant and machinery       184 131
 – land and buildings       1,023 575
Research and development costs expensed to the income statement      1,289 1,613
Cost of inventories recognised as expense       16,427 11,646
Staff costs       10,223 8,467
Fair value loss/(gain) on derivative financial instruments       179 (599) 
Net foreign exchange (gain)/loss       (63) 513
6. Exceptional items 
During 2010 the Group completed the rationalising of its two existing sites in Winsford into a new facility. During the year ended 31 December 
2010 expenditure of £1,001,000 was incurred in respect of the site move (year ended 31 December 2009: £909,000).
On 9 April 2009, the Board announced that it had been pursuing an acquisition opportunity that had reached an advanced stage of discussions 
but which had been terminated. The costs incurred in the year ended 31 December 2009 in respect of this aborted transaction amounted to 
£763,000.
Notes Forming Part of the Consolidated  
Financial Statements continued 49 Advanced Medical Solutions Group plc Annual Report 2010  
7. Auditor’s remuneration
Amounts payable to Deloitte LLP and their associates in respect of both audit and non-audit services:
       Year ended Year ended 
       31 December 31 December  
       2010 2009 
       £’000 £’000
Audit services
– Statutory audit of parent and consolidated financial statements      10 11
– Statutory audit of subsidiary companies       35 30
– Review of interim condensed consolidated financial statements      10 10
Tax services  
– Compliance services       10 10
Other services  
– Corporate finance services       – 368
– Employee remuneration services       8 – 
– Other       1 – 
        74 429
Fees payable to the Company’s auditor, Deloitte LLP, and its associates, for services other than the statutory audit of the Company are not 
disclosed in subsidiaries’ accounts because the consolidated accounts of the subsidiaries’ parent, AMS Group plc, are required to disclose such 
fees on a consolidated basis.
A description of the work of the Audit Committee is set out in the corporate governance section of the annual report which includes 
explanations of how the audit objectivity and independence is safeguarded when non-audit services are provided by the auditor.
8. Employees
The average monthly number of employees of the Group during the year, including Executive Directors, was as follows:
       Year ended Year ended 
       31 December  31 December 
       2010 2009 
       Number Number
Production       175 157
Research and development       19 18
Sales and marketing       37 38
Administration       27 28
       258 241
Sales and marketing includes 3 people (2009: 2) employed in the United States.
       Year ended Year ended 
       31 December 31 December  
       2010  2009 
       £’000 £’000
Staff costs for all employees, including Executive Directors, consists of: 
Wages and salaries       8,358 7,264
Social Security costs       1,251 705
Pension costs       332 296
Share-based payments (see note 34)       282 202
       10,223 8,467
9. Directors’ emoluments
          
       Year ended Year ended 
       31 December 31 December  
       2010  2009 
       £’000 £’000
Remuneration for management services       559 652
Pension       47 46
Amounts paid to third parties       149 110
Share-based payments       111 89
       866 897
Retirement benefits are accruing to the following number of directors under money purchase schemes   3 3 Advanced Medical Solutions Group
50   Advanced Medical Solutions Group plc Annual Report 2010
10. Key Management
The key management of the Group comprises the executive directors of the Group together with senior members of the management team. 
Their aggregate compensation is shown below:
Key management compensation (including executive directors)
       Year ended Year ended 
       31 December 31 December  
       2010  2009 
       £’000 £’000
Salaries and short-term employee benefits       1,237 1,215
Pension       92 71 
Termination payments       37 – 
Share-based payments       142 127
       1,508 1,413
Executive directors 
       Year ended Year ended 
       31 December 31 December  
       2010  2009 
       £’000 £’000
Salaries and short-term employee benefits       559 652
Pension       47 46
Share-based payments       111 89
       717 787
Highest paid director 
       Year ended Year ended 
       31 December 31 December  
       2010  2009 
       £’000 £’000
Salaries and short-term employee benefits       226 287
Pension       20 20 
Share-based payments       37 33
       283 340
11. Finance Income
       Year ended Year ended 
       31 December 31 December  
       2010  2009 
       £’000 £’000
Bank interest       1 21
Rent deposit interest       11 –
       12 21
12. Finance costs
       Year ended Year ended 
       31 December 31 December  
       2010  2009 
       £’000 £’000
Finance leases        6 5
Other loan interest       24 24
Bank Interest       105 1
Facility costs       263 –
Total interest expense       398 30
Less: Amounts included in the cost of qualifying assets        (338) –
       60 30
Borrowing costs included in the cost of qualifying assets during the year arose on the general borrowing pool and was calculated by applying  
a capitalisation rate of 34% to expenditure on such assets. The Group’s requirement for a facility (see page 34 for further information), was the 
result of investing in qualifying assets, in particular relating to the investment in the new facility in Winsford.
Notes Forming Part of the Consolidated  
Financial Statements continued 51 Advanced Medical Solutions Group plc Annual Report 2010  
13. Taxation 
       Year ended Year ended 
       31 December 31 December  
       2010  2009 
       £’000 £’000
a) Analysis of tax credit for the year  
Current tax:  
Corporation tax       29 18
Capital gains tax       – –
Deferred tax        513 372
Taxation       542 390
b) Factors affecting tax credit for the year  
The tax assessed for the year is lower than the standard rate of corporation tax in the UK (28%) as explained below:  
Profit before taxation       4,291 2,394
Profit multiplied by the standard rate of corporation tax in the UK of 28% (2009: 28%)     1,201 670
Effects of:  
Expenses not deductible for tax purposes       112 49
Depreciation for period less than capital allowances       (288) (76)
Utilisation and recognition of trading losses        (755) (641)
Research and development relief       (235) (336)
Share-based payments       (577) (56)
Taxation       (542) (390)
Following the budget in June 2010, the Finance (No 2) Act 2010 included a reduction in the rate of Corporation Tax from 28% to 27% effective 
from 1 April 2011. In addition to the amount charged to the income statement and other comprehensive income, the Group has recognised 
directly in equity:
excess tax deductions related to share-based payments on exercised options together with; • 
changes in excess deferred tax deductions related to share-based payments, • 
totalling £179,000 (2009: deficit £5,000).
14. Dividends
The Company is proposing a maiden final dividend of 0.38p per share (2009: nil), which is not recognised as a liability at the year end. The 
dividend is to be paid to shareholders on the register at close of business on 13 May 2011. Based on the register at the date of approval of these 
financial statements the total dividend will be £588,000.
15. Earnings per share
The calculation of the basic and diluted earnings per share is based on the following data:
       Year ended Year ended 
       31 December 31 December 
       2010 2009 
       £’000 £’000
Earnings for the purposes of basic and diluted earnings per share being net profit attributable to 
 equity holders of the parent
– pre exceptional items       5,834 4,456
– post exceptional items       4,833 2,784
Number of shares       ‘000 ‘000
Weighted average number of ordinary shares for the purposes of basic earnings per share    152,366 144,166
Effect of dilutive potential ordinary shares:
Share options, deferred share bonus, LTIPs       2,538 11,200
Weighted average number of ordinary shares for the purposes of diluted earnings per share    154,904 155,366
Earnings per share       pence pence
Basic – pre exceptional items       3.83p 3.09p
 post exceptional items       3.17p 1.93p
Diluted – pre exceptional items       3.77p 2.87p
 post exceptional items       3.12p 1.79p Advanced Medical Solutions Group
52   Advanced Medical Solutions Group plc Annual Report 2010
16. Acquired intellectual property rights, software intangibles and development costs
      Acquired   
      intellectual Software Development 
      property rights intangibles costs 
      £’000 £’000 £’000
2010
Cost
At beginning of year      2,518 195 1,002
Additions      – 5 167
At end of year      2,518 200 1,169
Amortisation
At beginning of year      1,288 161 277
Charged in the year      168 23 121
At end of year      1,456 184 398
Net book value
At 31 December 2010      1,062 16 771
At 31 December 2009      1,230 34 725
Intangible assets are amortised on a straight-line basis and the amortisation is recognised within administration costs.
Acquired intellectual property rights were initially recognised on the acquisition of Advanced Medical Solutions (Plymouth) Limited and represent 
patents held by the company.
      Acquired   
      intellectual Software Development 
      property rights intangibles costs 
      £’000 £’000 £’000
2009
Cost
At beginning of year      2,518 175 701
Additions      – 20 301
At end of year      2,518 195 1,002
Amortisation
At beginning of year      1,120 135 181
Charged in the year      168 26 96
At end of year      1,288 161 277
Net book value
At 31 December 2009      1,230 34 725
At 31 December 2008      1,398 40 520
Notes Forming Part of the Consolidated  
Financial Statements continued 53 Advanced Medical Solutions Group plc Annual Report 2010  
17. Property, plant and equipment
  Freehold land,  Short      
  property and leasehold Plant and Fixtures and Motor Assets under  
  improvements improvements machinery fittings vehicles construction Total 
  £’000 £’000 £’000 £’000 £’000 £’000 £’000
2010
Cost
At beginning of year  1,063 450 11,671 192 44 5,939 19,359
Additions  – – 486 38 – 3,133 3,657
Transfer of assets into use  – – 5,466 396 – (5,862) –
Disposals  – (76) (1,781) – – – (1,857)
Exchange Adjustment  – – (60) – – – (60)
At end of year  1,063 374 15,782 626 44 3,210 21,099
Depreciation
At beginning of year  20 446 8,407 158 44 – 9,075
Provided for the year  4 2 1,037 34 – – 1,077
Disposals  – (76) (1,781) – – – (1,857)
Exchange Adjustment  – – (24) – – – (24)
At end of year  24 372 7,639 192 44 – 8,271
Net book value
At 31 December 2010  1,039 2 8,143 434 – 3,210 12,828
At 31 December 2009  1,043 4 3,264 34 – 5,939 10,284
At 31 December 2010, the Group had entered into contractual commitments for the acquisition of property, plant and equipment amounting  
to £1,510,000 (2009 £2,659,000). Plant and machinery includes capitalised borrowing costs (see note 12 for further information).
The net book value of plant and equipment includes £62,000 of plant and machinery (2009: £56,000) held under finance leases. The related 
depreciation charge for the year was £17,000 for plant and machinery (2009: £17,000).
  Freehold land,  Short      
  property and leasehold Plant and Fixtures and Motor Assets under  
  improvements improvements machinery fittings vehicles construction Total 
  £’000 £’000 £’000 £’000 £’000 £’000 £’000
2009
Cost
At beginning of year  1,063 450 9,271 182 44 641 11,651
On acquisition of subsidiary  – – 1,104 – – – 1,104
Additions  – – 348 10 – 6,408 6,766
Transfer of assets into use  – – 1,110 – – (1,110) –
Disposals  – – (132) – – – (132)
Exchange adjustments  – – (30) – – – (30)
At end of year  1,063 450 11,671 192 44 5,939 19,359
Depreciation
At beginning of year  16 445 7,794 153 44 – 8,452
Provided for the year  4 1 668 5 – – 678
Disposals  – – (55) – – – (55)
At end of year  20 446 8,407 158 44 – 9,075
Net book value
At 31 December 2009  1,043 4 3,264 34 – 5,939 10,284
At 31 December 2008  1,047 5 1,477 29 – 641 3,199 Advanced Medical Solutions Group
54   Advanced Medical Solutions Group plc Annual Report 2010
18. Deferred tax
The following are the major deferred tax liabilities and assets recognised by the Group and movements thereon during the current and prior 
reporting periods.
     Revaluation Share-based   
     of building payment Tax losses Total 
     £’000 £’000 £’000 £’000
At 1 January 2009     (74) 655 1,464 2,045
Credit to income     – 56 316 372
Credit to equity     – 5 – 5
At 31 December 2009     (74) 716  1,780 2,422 
(Charge)/credit to income     – (16) 529 513
Charge to equity     – (179) – (179)
At 31 December 2010     (74) 521 2,309 2,756
Maturity of the deferred tax asset is as follows:
       2010 2009 
       £’000 £’000
Less than one year        1,080 790
Greater than one year       1,676  1,632
       2,756 2,422
Certain deferred tax assets and liabilities have been offset. The following is the analysis of the deferred tax balances (after offset) for financial 
reporting purposes:
       2010 2009 
       £’000 £’000
Deferred tax liabilities       (74) (74)
Deferred tax assets       2,830 2,496
       2,756 2,422
At the balance sheet date, the Group has unused tax losses of £27.4 million (2009: £29.1 million) available for offset against future profits. A 
deferred tax asset of £2.3 million (2009: 1.8 million) has been recognised in respect of such losses. No deferred tax asset has been recognised in 
respect of the remaining £19.1 million (2009: £24.0 million) of such losses due to the unpredictability of future profit streams. 
19. Investment in joint venture
On 30 May 2008 the Group and Recticel formed a joint venture relating to Corpura B.V. (now Advanced Medical Solutions B.V.), Recticel’s fully 
owned subsidiary; the Group acquired 49.4% of the issued share capital of Corpura B.V..
On 30 September 2009 the Group purchased Recticel’s share of the joint venture relating to Corpura B.V., which represented 50.6% of issued 
share capital. See note 33 for further information regarding this transaction.
Amounts from the joint venture recognised in the income statement are as follows:
       2010 2009 
       £’000 £’000
Operating profit       – (47)
Less: interest       – (32)
Less: tax       – –
        (79)
Less: provision for unrealised profit       – 13
Share of results of joint venture       – (66)
Net book value of interest in joint venture
       2010 2009 
       £’000 £’000
At 1 January       – 1,749
Movement in interest in associate       – (79)
On acquisition of 50.6% of Corpura B.V.       – (1,573)
Exchange       – (97)
At 31 December        – –
Notes Forming Part of the Consolidated  
Financial Statements continued 55 Advanced Medical Solutions Group plc Annual Report 2010  
20. Goodwill
       2010 2009 
       £’000 £’000
Cost
At 1 January        2,978 –
Recognised on acquisition of a subsidiary       – 3,062
Exchange differences        (100) (84)
At 31 December        2,878 2,978
Accumulated impairment losses
At 1 January and 31 December        – –
Carrying amount
At 31 December        2,878 2,978
Goodwill arose on the acquisition of Advanced Medical Solutions B.V. on 30 September 2009.
The Group tests goodwill annually for impairment, or more frequently if there are indications that goodwill might be impaired.
The recoverable amount in respect of Advanced Medical Solutions B.V. has been determined based on a value-in-use calculation, which uses cash 
flow projections based on financial budgets approved by the directors covering a three-year period. These budgets have been adjusted to reflect 
the existing state of the business and, consequently, omit investment plans. Cash flows beyond that three-year period have been extrapolated 
using a steady 2% (2009: not applicable) per annum growth rate; the growth rate would have to fall from +2.0% to -3.2% in order for an 
impairment to be required. This growth rate does not exceed the long-term average growth rate for the market in which Advanced Medical 
Solutions B.V. operates. A discount rate of 8% per annum (2009: not applicable) has been applied to these cash flows. The directors believe that 
any reasonably possible further change in the key assumptions on which the recoverable amount is based would not cause Advanced Medical 
Solutions B.V.’s carrying amount to exceed its recoverable amount.
21. Inventories
       2010 2009 
       £’000 £’000
Raw materials       1,392 1,419
Work in progress       596 1,465
Finished goods       510 295
       2,498 3,179
There is no material difference between the replacement cost of inventories and the amount at which it is stated in the financial statements. 
Included above are finished goods of £12,000 (2009: £4,000) carried at net realisable value.
       2010 2009 
       £’000 £’000
Total gross inventories       2,827 3,613
Inventory impairment       (329) (434)
Net inventory       2,498 3,179
       2010 2009 
Inventory impairment       £’000 £’000
At beginning of year       (434) (321)
Income statement charge       (281) (179)
Provision released       76 12
Provision utilised       310 54
At end of year       (329) (434) Advanced Medical Solutions Group
56   Advanced Medical Solutions Group plc Annual Report 2010
22. Trade and other receivables
       2010 2009 
       £’000 £’000
Due within one year
Trade receivables       5,282 5,604
Other receivables       294 752
Prepayments and accrued income       459 589
       6,035 6,945
       2010 2009 
       £’000 £’000
Amount receivable for the sale of goods        5,436 5,694
Provision for impairment       (154) (90)
Trade receivables       5,282 5,604
The Group’s principal financial assets are cash and trade receivables. The Group’s credit risk is primarily attributable to its trade receivables.
The average credit period taken on sales of goods is 52 days (2009: 54 days). No interest is charged on the receivables within the contracted 
credit period. Thereafter, interest may be charged at 2% per month on the outstanding balance. In determining the recoverability of a trade 
receivable the Group considers any change in the credit quality of the trade receivable from the date credit was initially granted up to the 
reporting date. The concentration of credit risk is limited due to the Group’s large and unrelated customer base. Accordingly, the directors 
believe that there is no further credit provision required in excess of the allowance for impairments.
Before accepting any new customer, the Group assesses the potential customer’s credit quality and defines credit limits by customer. Limits are 
reviewed on an ongoing basis and reflect current payment history.
Included in the Group’s trade receivable balance are debtors 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 
or other credit enhancements over these balances. The carrying amount and ageing of these debtors are summarised below:
Ageing of overdue but not impaired receivables
       2010 2009 
       £’000 £’000
31 to 60 days overdue       264 145
61 to 90 days overdue       374 45
Total       638 190
Movement in provision for impairment
       Year ended Year ended 
       31 December 31 December 
       2010 2009 
       £’000 £’000
Balance at the beginning of the year       90 10
Impairment losses recognised        76 103
Amounts written off as uncollectible       (12) (13)
Amounts recovered during the year       – (10)
Balance at the end of the year       154 90
Analysis of customers
Year ended 31 December 2010
       Revenue % of total  
       £’000 revenue
Customers accounting for more than 10% of revenue – Customer 1      3,366 10.5
Year ended 31 December 2009 
       Revenue % of total 
       £’000 revenue
Customers accounting for more than 10% of revenue  
– Customer 3       2,477 10.3
– Customer 2       3,439 14.3
– Customer 1       3,386 14.1
Notes Forming Part of the Consolidated  
Financial Statements continued 57 Advanced Medical Solutions Group plc Annual Report 2010  
22. Trade and other receivables continued
Ageing of impaired trade receivables
       2010 2009 
       £’000 £’000
31 to 60 days overdue       2 –
61 to 90 days overdue       –  –
Over 90 days overdue       152  90
Total       154 90
23. Investments, cash and cash equivalents
       2010 2009 
       £’000 £’000
Cash and cash equivalents       4,122 1,992
Total       4,122 1,992
Cash and cash equivalents comprise cash and short-term bank deposits with an original maturity of three months or less. The carrying amount of 
these assets is approximately equal to their fair value.
24. Trade and other payables
       2010 2009 
       £’000 £’000
Current liabilities
Trade payables       1,642 2,468
Other payables       466 347
Derivative financial instruments       102 26
Accruals and deferred income       1,588 3,046
       3,798 5,887
Non-current liabilities
Other payables       677  278
Trade payables, other payables and accruals and deferred income principally comprise amounts outstanding for trade purchases and  
ongoing costs. 
At 31 December 2009, accruals and deferred income included deferred consideration of £1,265,000 (31 December 2010: nil) relating to the 
acquisition of Advanced Medical Solutions B.V. (see note 33). The average credit period taken for trade purchases is 71 days (2009: 72 days). No 
interest is charged on trade payables that are within pre-agreed credit terms. Thereafter, interest may be charged on the outstanding balances 
at various interest rates. The Group has financial risk management policies in place to ensure that all payables are paid within the pre-agreed 
credit terms.
The directors consider that the carrying amount of trade payables approximates to their fair value.
25. Current financial liabilities
       2010 2009 
       £’000 £’000
Obligations under finance leases (see note 28)       19 16
Other loans       18 18
       37 34
26. Non-current financial liabilities
       2010 2009 
       £’000 £’000
Obligations under finance leases (see note 28)       23 39
Other loans       226 244
       249 283
The loan is secured by a fixed charge on the freehold property. It is repayable in monthly instalments and interest is payable at 8% fixed rate. The 
maturity by currency of finance leases and other loans is given in note 27. Advanced Medical Solutions Group
58   Advanced Medical Solutions Group plc Annual Report 2010
27. Financial instruments
Categories of financial instruments
All financial instruments held by the Group, as detailed in this note, are classified as ‘Loans and Receivables’ (trade and other receivables, cash  
and cash equivalents), ‘Held to maturity investments’ (short-term investments), ‘Financial Liabilities Measured at Amortised Cost’ (trade and other 
payables, financial liabilities and obligations under finance leases), ‘Derivative instruments in designated hedge accounting relationships (cash 
flow hedges)’ and ‘Fair value through profit and loss (FVTPL)’ (derivative financial instruments) under IAS 39 ‘Financial Instruments: Recognition 
and Measurement’ and finance leases under IAS 17 ‘ Leases’.
     Carrying value
       2010 2009 
       £’000 £’000
Financial assets
Loans and receivables (including cash and cash equivalents)      10,176 8,943
Financial liabilities
Derivative instruments in designated hedge accounting relationships      102 26
Amortised cost       4,659 6,456
Page 26 of the Report of the Directors provides an explanation of the financial risks faced by the Group and the objectives and policies for 
managing those risks. The information below deals with the financial assets and liabilities.
( a ) M a t u r i t y o f fi n a n c i a l li a b ili t i e s
The maturity profile of the Group’s financial liabilities, of which other loans and finance lease obligations are at fixed rates and denominated in 
sterling whilst derivative financial instruments are non-interest bearing, is as follows:
   On demand Between Between  Total  
   or within one and two and Five years  financial Interest 
   one year two years five years or more liabilities rate 
   £’000 £’000 £’000 £’000 £’000 %
2010
Trade and other payables   3,696 53 158 466 4,373 –
Other loans   18 20 70 136 244 8.5
Finance lease creditors    19 17 6 – 42 11.6
Derivative financial instruments   102 – – – 102 –
At 31 December 2010   3,835 90 234 602 4,761 
   On demand Between Between  Total  
   or within one and two and Five years  financial Interest 
   one year two years five years or more liabilities rate 
   £’000 £’000 £’000 £’000 £’000 %
2009
Trade and other payables   5,861 16 48 214 6,139 –
Other loans   18 20 70 154 262 8.5
Finance lease creditors    16 16 23 – 55 8.2
Derivative financial instruments    26 – – – 26 –
At 31 December 2009   5,921 52 141 368 6,482 
   Financial liabilities on which 
 Fixed rate financial liabilities  no interest is paid 
 Weighted average period for  Weighted average period 
 which rate is fixed 
|
 until maturity
     2010 2009 2010 2009 
     Years Years Years Years
Other loans     9 10 – –
Finance lease creditors      4 4 – –
Notes Forming Part of the Consolidated  
Financial Statements continued 59 Advanced Medical Solutions Group plc Annual Report 2010  
27. Financial instruments continued
( b ) I n t e r e s t r a t e a n d c u r r e n c y o f fi n a n c i a l a s s e t s
The currency and interest rate profile of the financial assets of the Group is as follows:
Investments and cash and cash equivalents
        Fixed rate 
        weighted 
       Non-interest average 
    Total Floating Fixed bearing interest rate 
    £’000 £’000 £’000 £’000 %
Currency     
Sterling    2,027 2,027 – – –
US Dollar    1,743 352 – 1,391 –
Euro    352 – – 352 –
At 31 December 2010    4,122 2,379 – 1,743 
        Fixed rate 
        weighted 
       Non-interest average 
    Total Floating Fixed bearing interest rate 
    £’000 £’000 £’000 £’000 %
Currency
Sterling    1,214 1,214 – – –
US Dollar    521 – – 521 –
Euro    257 – – 257 –
At 31 December 2009    1,992 1,214 – 778 
Trade and other receivables
The directors consider that the carrying amount of trade and other receivables approximates their fair value.
       2010 2009 
       £’000 £’000
Sterling       4,106 5,006
Euro       721 526
US Dollar       1,208 1,413
       6,035 6,945
The financial assets all mature within one year.
( c ) C u r r e n c y e x p o s u r e s
At 31 December 2010 the Group had unhedged US Dollar currency exposures of £2,289,000 (2009: £1,689,000) and unhedged Euro currency 
exposures of £544,000 (2009: £140,000).
Risk sensitivity
See Report of the Directors (page 26) for risk sensitivities in respect of US dollar and Euro denominated revenue and material prices.
Forward foreign exchange contracts
It is the policy of the Group to enter into forward foreign exchange contracts to cover specific foreign currency payments and receipts. Advanced Medical Solutions Group
60   Advanced Medical Solutions Group plc Annual Report 2010
27. Financial instruments continued
The following table details the forward foreign currency contracts outstanding as at the year-end:
Outstanding Contracts Average exchange rate 
|
 Foreign currency 
|
 Contract value 
|
 Fair value: Loss
 2010 2009 2010 2009 2010 2009 2010 2009 
      £‘000  £‘000 £’000 £’000 
Cash flow hedges
Sell US dollars USD# : £1 USD# : £1 USD’000 USD’000
Less than 3 months 1.592 1.660 1,000 1,200 629 723 14 11
3 to 6 months 1.585 1.669 1,600 300 1,011 180 18 4
7 to 12 months  1.599 1.645 3,100 2,970 1,940 1,805 55 11
   5,700 4,470 3,580 2,708 87 26
Sell Euros EUR# : £1 EUR# : £1 EUR’000 EUR’000  
Less than 3 months 1.180 – 150 – 127 – 2 –
3 to 6 months 1.180 – 150 – 127 – 2 –
7 to 12 months  1.179 – 790 – 670 – 11 –
   1,090 – 924 – 15 –
The fair value amounts presented above are the difference between the market value of equivalent instruments at the balance sheet date and 
the contract value of the instruments. No profits or losses are included in operating profit in the year (2009: £599,000 gain) in respect of FVTPL 
contracts. The loss of £102,000 (2009: £26,000 loss) in respect of cash flow hedges has been taken to reserves, which is off-set by the release of 
2009’s loss of £26,000, leading to a net movement of £76,000 in the year.
28. Obligations under finance leases
  
|
 Present value of lease 
 Minimum lease payments 
|
 payments
     2010 2009 2010 2009 
     £’000 £’000 £’000 £’000
Amounts payable under finance leases:      
Within one year     19 21 19 16
In the second to fifth years inclusive     31 44 23 39
After five years     – – – –
Less: future finance charges     (8) (10)   
Present value of lease obligations     42 55 42  55
Less: Amount due for settlement within
12 months (shown under current financial liabilities)       (19) (16)
Amount due for settlement after 12 months       23 39
It is the Group’s policy to lease certain of its fixtures and equipment under finance leases. The average lease term is four years (2009: four years). 
For the year ended 31 December 2010, the average effective borrowing rate was 11.6% (2009: 8.2%). Interest rates are fixed at the contract 
date. All lease obligations are denominated in sterling.
The fair value of the Group’s lease obligations approximates their carrying amount.
29. Fair value of financial assets and liabilities
The directors consider that the fair value of the Group’s financial instruments do not differ significantly from their book values.
30. Foreign exchange rates
 Average rate 
|
 Closing rate 
|
 Percentage change
   2010 2009 2010 2009 Average Closing 
       % %
Currency
US Dollar   1.547 1.567 1.566 1.615 (1) (3)
Euro   1.164 1.123 1.167 1.126 4 4
Notes Forming Part of the Consolidated  
Financial Statements continued 61 Advanced Medical Solutions Group plc Annual Report 2010  
31. Share capital
Number of ordinary shares of 5p each
        Allotted, 
        called up and  
       Authorised fully paid 
       ‘000 ‘000
At 1 January 2009       206,447 143,398
New issues in the year       – 162
Share options exercised       – 1,405
At 31 December 2009       206,447 144,965
New issues in the year       – 100
Share options exercised       – 9,740
At 31 December 2010       206,447 154,805
During the year, employees exercised share options of 9,740,000 shares at a range of option prices from 0p to 34p. On 5 May 2010 100,000 
shares were issued under the Deferred Share Bonus Scheme at the nominal value of 5p per share; 519,000 shares are retained by the scheme to 
meet the matching requirements of the scheme.
O r d in a r y s h a r e s o f 5 p e a c h
        Allotted, 
        called up and  
       Authorised fully paid 
       £’000 £’000
At 1 January 2009       10,322 7,169
At 31 December 2009       10,322 7,248
New issues in the year       – 5
Share options exercised       – 487
At 31 December 2010       10,322 7,740
32. Reserves
Investment in own shares
This is the nominal value of the shares held in trust on behalf of employees in respect of the DSB scheme.
Other reserve
This represents Advanced Medical Solutions Limited’s share premium account arising from merger accounting.
33. Acquisition of subsidiary
On 30 September 2009 the Group acquired the remaining 50.6% of the issued share capital of Corpura B.V., having acquired 49.4% on  
30 May 2008. Corpura B.V. develops and produces hydrophilic polyurethane foams in Etten Leur, the Netherlands. This transaction has been 
accounted for by the purchase method of accounting.
       Book value Fair value 
       £’000 £’000
Net assets acquired  
Intellectual property       137 –
Property, plant and equipment       1,278 1,104
Inventories       214 122
Trade and other receivables       272 272
Cash and cash equivalents       169 169
Trade and other payables       (202) (202)
Loans       (1,403) (1,403)
       465 62
Goodwill (see note 20)        3,062
Total consideration        3,124 Advanced Medical Solutions Group
62   Advanced Medical Solutions Group plc Annual Report 2010
Notes Forming Part of the Consolidated  
Financial Statements continued
33. Acquisition of subsidiary continued
Goodwill is denominated in euros in line with Corpura B.V.’s functional currency. Retranslation of goodwill at the closing euro rate on 31 
December 2010 led to a reduction in the goodwill recorded on the balance sheet to £2,878,000 (2009: £2,978,000) – see note 20. This 
translation difference of £100,000 (2009: £84,000) is recognised within the Group’s translation reserve.
Satisfied by:        £’000 
Cash: Paid up to 31 December 2009        1,687
Deferred consideration (translated at the exchange rate prevailing on acquisition): settled during the year ended 31 December 2010 1,302
Directly attributable costs        135
        3,124
The above consideration includes amounts paid in 2008 in respect of the formation of the joint venture totalling £1,376,000 (cash of £1,276,000; 
directly attributable costs £100,000) together with exchange gains on these euro-denominated transactions at 30 September 2009 amounting 
to £277,000. Re-translation of the deferred consideration, which was denominated in euros, at 31 December 2009 led to a reduction in  
the amount recorded on the balance sheet to £1,265,000; the translation difference of £37,000 being recognised within the Group’s  
translation reserve.
       Year ended Year ended 
       31 December 31 December 
       2010 2009 
Net cash flow arising on acquisition       £’000 £’000
Cash consideration, including directly attributable costs, translated at prevailing exchange rates   1,255 238
Cash acquired       – (169)
       1,255 69
The goodwill arising on the acquisition of Corpura B.V. is attributable to the anticipated improved profitability of the Company and the 
development of new products utilising the Company’s platform material for delivering new technologies that can help accelerate wound healing, 
neither of which relates to separately identifiable assets.
Corpura B.V. contributed £701,000 to revenue and £21,000 to profit before tax for the period between the date of acquisition and  
31 December 2009.
If the acquisition of Corpura B.V. had been completed on the first day of the financial year ended 31 December 2009, group revenues for the 
period would have been £25,468,000 and the Group profit attributable to equity holders of the parent would have been £2,711,000. 
34. Share-based payments
The charge for share-based payments under IFRS 2, included in administrative expenses, arises across the following schemes: 
 
       2010 2009 
       £’000 £’000
Unapproved Executive Share Option Scheme, Enterprise Management Incentive Scheme and Company Share Option Plan 62 29
Long Term Incentive Plan       101 101
Deferred Share Bonus Scheme       119 72
       282 202 63 Advanced Medical Solutions Group plc Annual Report 2010  
34. Share-based payments continued
Unapproved Executive Share Option Scheme, Enterprise Management Incentive Scheme and Company Share Option Plan
The fair value of the executive options is calculated based on a Black-Scholes Merton model assuming the inputs below:
Grant Date 15/7/04 16/7/04 21/3/05 12/9/05 15/3/06 6/4/06 21/9/06 12/04/07 26/09/07
Share price at grant date 9p 9p 10.2p 9.25p 10.75p 10.75p 11.25p 16.75p 26.75p 
Exercise price 9p 9p 10.2p 9.25p 10.75p 10.75p 11.25p 16.75p 26.75p 
Expected life 3.5 yrs 3.5 yrs 3.5 yrs 3.5 yrs 3.5 yrs 3.5 yrs 3.5 yrs 3.5 yrs 3.5 yrs
Contractual life 10 yrs 10 yrs 10 yrs 10 yrs 10 yrs 10 yrs 10 yrs 10 yrs 10 yrs
Risk free rate 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 4.5% 5.0% 5.0%
Expected volatility 30% 30% 30% 30% 30% 30% 30% 27% 27%
Expected dividend yield 0% 0% 0% 0% 0% 0% 0% 0% 0%
Fair value of options 2p 1p 1p 1p 2p 1p 1p 2p 4p
         
Grant Date 16/4/08 15/10/08 20/4/09 5/10/09 16/4/10  20/10/10
Share price at grant date 32.25p 31.75p 33.75p 28.75p 42.0p 64.0p
Exercise price 32.25p 31.75p 33.75p 28.75p 42.0p 64.0p
Expected life 3.5 yrs 3.5 yrs 3 yrs 3 yrs 3 .5yrs 3 yrs
Contractual life 10 yrs 10 yrs 10 yrs 10 yrs 10 yrs 10 yrs
Risk free rate 5.0% 5.0% 2.4% 2.4% 2.4% 2.4%
Expected volatility 38% 38% 34% 34% 34% 34%
Expected dividend yield 0% 0% 0% 0% 0% 0%
Fair value of options 8p 8p 6p 5p 9p 8p
Under the terms of the Company’s Share Option Schemes, approved by Shareholders in 1999 and amended in 2001 and 2002, the Board may 
offer options to purchase ordinary shares in the Company to all employees of the Company at the market price on a date to be determined prior 
to the date of the offer. Since 2005, individuals who are entitled to awards under the LTIP are no longer eligible to receive options under the 
Company’s Share Option Schemes.
Performance targets are assessed over a three-year period from the date of grant. Once options have vested they can be exercised during the 
period up to ten years from the date of grant.
The expected volatility was determined by calculating the historic volatility of the Group’s share price over the previous three years. Advanced Medical Solutions Group
64   Advanced Medical Solutions Group plc Annual Report 2010
34. Share-based payments continued
Options have been granted over the following number of ordinary shares which were outstanding at 31 December 2010.
     No of    
   Weighted options Remaining      No of options Remaining 
   average  as at  life     as at  life 
  Option price at 1 January 1 January     31 December 31 December 
Date of grant  price (p) exercise (p) 2010 2010 (years) Issued Lapsed Exercised  2010 2010 (years)
Unapproved Executive Share Option Scheme
15.07.04 9.00 35.00 234,722 4.5 – – 234,722 – –
12.04.07 16.75 71.50 50,000 7.3 – – 50,000 – –
20.04.09 33.75 – 70,000 9.3 –  – – 70,000  8.3
16.04.10 42.00 – –  389,000 – – 389,000 9.3
20.10.10 64.00 – –  306,250 – – 306,250 9.8
         
Enterprise Management Incentive Scheme
15.07.04 9.00 35.49 776,401 4.5 – – 760,593 15,808 3.5
16.07.04 9.00 65.50 7,324 4.5 – – 2,500 4,824 3.5
21.03.05 10.20 35.00 16,000 5.2 – – 16,000 – –
12.09.05 9.25 39.55 11,000 5.7 – – 11,000 – –
15.03.06 10.75 37.74 649,000 6.2 – – 648,000 1,000 5.2
06.04.06 10.75 35.00 150,000 6.3 – – 150,000 – –
21.09.06 11.25 35.00 22,000 6.7 – – 10,000 12,000 5.7
12.04.07 16.75 41.68 1,282,610 7.3 – – 947,196 335,414 6.3
26.09.07 26.75 – 13,000 7.7 – – – 13,000 6.7
16.04.08 32.25 – 197,500 8.3 – – – 197,500 7.3
15.10.08 31.75 – 45,000 8.8 – – – 45,000 7.8
20.04.09 33.75 – 626,500 9.3 – 90,000 – 536,500 8.3
05.10.09 28.75 – 372,500 9.8 – 15,000 – 357,500 8.8
16.04.10 42.00 68.75 –  1,142,130 93,250 250 1,048,630 9.3
Company Share Option Plan       
20.10.10 64.00 – –  118,750 – – 118,750 9.8
  4,523,557  1,956,130 198,250 2,830,261 3,451,176
The weighted average remaining contractual life of the options outstanding at 31 December 2010 is 8.7 years (2009: 7.0 years)
   2010 
|
 2009
       Weighted   Weighted 
      average   average 
     Number of exercise  Number of exercise 
     Options price (p) Options price (p)
Outstanding at beginning of the period     4,523,557 18.34 5,049,700 13.29
Granted     1,956,130 46.78 1,069,000 32.00
Exercised     (2,830,261) 38.69 (1,455,950) 33.37
Forfeited     (198,250) 37.25 (139,193) 24.65
Outstanding at end of the period     3,451,176 38.37 4,523,557 18.34
Exercisable at end of period     382,046 16.48 1,866,447 9.79
Long Term Incentive Plan (LTIP)
The fair value of the LTIP is calculated based on a binominal tree model assuming the inputs below:
Grant date    12/10/05 12/04/07 15/10/08 23/4/09 16/4/10
Share price of grant date    8.75p 16.75p 31.75p 33.30p 42.00p
Exercise price    0p 0p 0p 0p 0p
Expected life    3.5 yrs 3.5 yrs 3.5 yrs 3.0 yrs 3.0 yrs
Contractual life    10 yrs 10 yrs 10 yrs 10 yrs 10 yrs
Risk-free rate    4.5% 5.0% 4.2% 2.4% 1.9%
Expected volatility    30% 27% 33% 34% 36%
Expected dividend yield    0% 0% 0% 0% 0.7%
Probability of performance conditions    40% 43% 100% 43% 51%
Fair value of option    2p 4p 31.7p 14.5p 41.1p
Notes Forming Part of the Consolidated  
Financial Statements continued 65 Advanced Medical Solutions Group plc Annual Report 2010  
34. Share-based payments continued
The expected volatility was determined by calculating the historic volatility of the Group’s share price over the previous three years. 
The entitlement to shares under the LTIP is subject to achieving the performance conditions referred to on page 29. The numbers shown are 
maximum entitlements and the actual number of shares (if any) will depend on these performance conditions being achieved.
 
 Market Number of Remaining    Number Remaining 
 price at LTIPs at life    of LTIPs life  
 date of 1 January 1 January    31 December 31 December  
Date of grant Grant (p) 2010 2010 (years) Issued Lapsed Exercised 2010 2010 (years)
Long Term Incentive Plan
12.10.05 8.75 3,713,744 5.8 – – 3,713,744 – –
12.04.07 16.75 2,710,000 7.3 – – 2,710,000 – –
15.10.08 31.75 500,000 8.8 – 200,000  300,000 7.8
23.4.09 33.30 1,076,485 9.3 – – – 1,076,485 8.3
16.04.10 42.00 – – 140,000 30,000 – 110,000 9.3
  8,000,229   140,000 230,000 6,423,744 1,486,485 
The weighted average remaining contractual life of the LTIPs outstanding at 31 December 2010 is 8.3 years (2009: 7.5 years).
       2010 2009 
       Number of Number of 
       Options options
Outstanding at beginning of the period       8,000,229 7,023,744
Granted       140,000 1,076,485
Exercised       (6,423,744) –
Forfeited       (230,000) (100,000)
Outstanding at end of the period       1,486,485 8,000,229
Exercisable at end of period       – 3,713,744
The exercise price of these options is £1 for each issue of LTIPs.
Deferred Share Bonus Scheme (DSB)
The fair value of the DSB is calculated based on a Black-Scholes Merton model assuming the inputs below:
Grant date  12/04/07 12/04/07 02/05/08 04/06/08 23/04/09 05/05/10 05/05/10
Share price at grant date  18.25p 18.25p 35.50p 35.50p 34.00p 40.32p 40.32p
Exercise price  0p 0p 0p 0p 0p 0p 0p
Expected life  3.5 yrs 3.5 yrs 3.5 yrs 3.5 yrs 3.0 yrs 5.0 yrs 3.0 yrs
Contractual life  10 yrs 10 yrs 10 yrs 10 yrs 10 yrs 10 yrs 10 yrs
Risk-free rate  5.0% 5.0% 5.0% 5.0% 2.4% 2.4% 2.4%
Expected volatility  27% 27% 38% 38% 30% 34% 34%
Expected dividend yield  0% 0% 0% 0% 0% 0% 0%
Probability of performance conditions  100% 67% 100% 100% 100% 100% 100%
Fair value of option  14p 9p 30p 28p 29p 34p 34p
The expected volatility was determined by calculating the historic volatility of the Group’s share price over the previous three years. Advanced Medical Solutions Group
66   Advanced Medical Solutions Group plc Annual Report 2010
34. Share-based payments continued
The weighted average remaining contractual life of the DSB outstanding at 31 December 2010 is 8.4 years (2009: 8.2 years). The entitlement to shares 
under the DSB is subject to a three year holding period. Additionally, for certain levels of share matching, additional performance conditions also need to 
be achieved. The actual number of shares that will be matched will depend on these performance conditions. Details on the DSB are given on page 29.
  Number of     Number of    
  DSB     DSB   
 Market matching Remaining    matching Remaining 
 price at shares at life    shares at life  
 date of 1 January 1 January    31 December 31 December  
Date of grant Grant (p) 2010 2010 (years) Issued Lapsed Exercised 2010 2010 (years)
Deferred Share Bonus Scheme      
12.04.07 18.25 667,549 7.3 – – 456,169 211,380 6.3
02.05.08 35.50 219,524 8.3 – 72,675 25,352 121,497 7.3
04.06.08 35.50 141,787 8.4 – – – 141,787 7.4
23.04.09 34.00 459,970 9.3 – 10,293 22,057 427,620 8.3
05.05.10 40.32 – – 819,681 18,600 – 801,081 9.3
  1,488,830  819,681 101,568 503,578 1,703,365 
Deferred Share Bonus Scheme
       2010 2009 
       Number of Number of 
       Options options
Outstanding at beginning of the period       1,488,830 1,037,747
Granted       819,681 459,970
Exercised       (503,578) –
Forfeited       (101,568) (8,887)
Outstanding at end of the period       1,703,365 1,488,830
Exercisable at end of period       211,380 –
The exercise price of the matching shares is £nil.
35. Commitments under operating leases
As at 31 December 2010, the Group had outstanding commitments under operating leases, which fall due as follows:
     2010  2009  
     Land and 2010 Land and 2009 
     buildings Other buildings Other 
     £’000 £’000 £’000 £’000
Amounts payable under operating leases:        
Within one year     847 31 666 44
In two to five years     3,171 151 3,173 100
After five years     6,929 – 2 –
     10,947 182 10,904 146
36. Related party transaction
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed 
in this note. Transactions between the Group and its joint venture during the period prior to the acquisition of a controlling interest are disclosed 
below. Transactions between the Company and its subsidiaries and joint venture are disclosed in the Company’s separate financial statements.
During the year, Group companies entered into the following transactions with related parties who are not members of the Group.
      Amounts owed  Amounts owed 
 Sale of goods 
|
 Purchase of goods 
|
 by related parties 
|
 to related parties
 2010 2009 2010 2009 2010 2009 2010 2009 
 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Joint venture – – – 274 – – – –
Purchases were made at arm’s length and were made at market price discounted to reflect the quantity of goods purchased and the relationship 
between the parties.
The remuneration of the Board of directors, who are considered key management personnel of the Group, is provided in the remuneration 
report on pages 29 to 31.
Notes Forming Part of the Consolidated  
Financial Statements continued 67 Advanced Medical Solutions Group plc Annual Report 2010  
       2010 2009 
      Note £’000 £’000
Fixed assets
Investments      3 10,280 11,631
Current assets
Debtors         4 390 484
Cash at bank and in hand       – 107
       390 591
Creditors: amounts falling due within one year      5 (415) (1,534)
Net current liabilities       (25) (943)
Net assets       10,255 10,688
Capital and reserves
Called up share capital       7,740 7,248
Share-based payments reserve       442 502
Investment in own shares       (37) (27)
Share premium account       306 99
Profit and loss account       1,804 2,866
Equity shareholders’ funds       10,255 10,688
The financial statements of Advanced Medical Solutions Group plc (registration number 2867684) on pages 67 to 70 were approved by the 
Board of directors and authorised for issue on 20 April 2011 and were signed on its behalf by:
Chris Meredith
Chief Executive Officer
20 April 2011
Company Balance Sheet
A t   3 1   Decem ber   2 0 1 0 Advanced Medical Solutions Group
68   Advanced Medical Solutions Group plc Annual Report 2010
Notes to the Company Financial Statements
Y e a r   ended   3 1   Decem ber   2 0 1 0
1. Significant accounting policies
Basis of accounting
The separate financial statements of the Company are presented as required by the Companies Act 2006. They have been prepared under the 
historical cost convention and in accordance with applicable United Kingdom Accounting Standards and law.
The principal accounting policies are summarised below. They have all been applied consistently throughout the year and the preceding year.
The Company has taken advantage of the exemption of FRS8 from disclosing transactions with other members of the Group and the exemption 
in FRS29 for making disclosures in relation to financial instruments.
Investments
Fixed asset investments in subsidiaries and associates are shown at cost less provision for impairment.
For investments in subsidiaries acquired for consideration including the issue of shares qualifying for merger relief, cost is measured by reference 
to the nominal value only of the shares issued. Any premium is ignored.
Financial liabilities and equity
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity 
instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities.
Share-based payments
The Company has applied the requirements of FRS20 ‘Share-based payment’. In accordance with the transitional provisions, FRS20 has been 
applied to all grants of equity instruments after 7 November 2002 that were unvested as at 1 January 2005.
The Company issues equity-settled share-based payments to certain employees. Equity-settled share-based payments are measured at fair value 
at the date of grant. The fair value as determined at the grant date of equity-settled share-based payments is expensed on a straight-line basis 
over the vesting period, based on the Company’s estimate of shares that will eventually vest.
Fair value is measured by use of a Black-Scholes Merton model. The expected life used in the model has been adjusted, based on management’s 
best-estimate, for the effect of non-transferability, exercise restrictions and behavioural considerations.
Liquid resources
Liquid resources comprise variable term deposits that are accessible with less than 12 months’ notice.
2. Loss 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. 
AMS Group plc reported a loss for the financial year ended 31 December 2010 of £1,062,000 (2009: £2,325,000).
The auditor’s remuneration for audit and other services is disclosed in note 7 to the consolidated financial statements.
The Company had no employees. The directors’ remuneration is detailed in note 9 to the consolidated financial statements.
3. Fixed asset investments
      Investments 
      in subsidiaries Loans Total 
      £’000 £’000 £’000
Cost
At 1 January 2010      5,040 43,836 48,876
Movement      277 (1,690) (1,413)
Exchange adjustments      – 62 62
At 31 December 2010      5,317 42,208 47,525
Provisions for impairment
At 1 January and 31 December 2010      1,670 35,575 37,245
Net Book value
At 31 December 2010      3,647 6,633 10,280
At 31 December 2009      3,370 8,261 11,631 69 Advanced Medical Solutions Group plc Annual Report 2010  
3. Fixed asset investments continued
Investments in subsidiaries and loans have been written down to recognise losses in subsidiary companies.
The following were subsidiary undertakings at the end of the year and have all been included in the consolidated accounts.
     Proportion of 
     voting rights 
      and Ordinary 
    Country of share capital  
Name    Operation Held Nature of business
Advanced Medical Solutions Limited    England 100% Development and manufacture
      of medical products
Advanced Medical Solutions (UK) Limited    England 100% Holding Company
Advanced Medical Solutions Trustee Company Limited    England 100% Trustee Company
Advanced Medical Solutions (Plymouth) Limited – formerly MedLogic Global Limited England 100% Development and manufacture
      of medical products
Advanced Healthcare Systems Limited    England 100%* Dormant
Advanced Medical Solutions Group Inc.    USA 100%
†
 Holding Company
Advanced Medical Solutions (US) Inc.    USA 100%
§
 Development and manufacture
      of medical products
MedLogic Global Holdings Limited    England 100%
¶
 Holding Company
Innovative Technologies Limited    England 100%
‡
 Dormant
Advanced Medical Solutions B.V. – formerly Corpura B.V.    Netherlands 100% Development and manufacture  
      of medical products
* Held indirectly through Advanced Medical Solutions Limited.
‡ Held indirectly through MedLogic Global Holdings Limited.
† Held indirectly through Advanced Medical Solutions (UK) Limited.
§ Held indirectly through Advanced Medical Solutions Group Inc.
¶ Held indirectly through Advanced Medical Solutions (Plymouth) Limited.
The above table reflects the situation at the year-end.
4. Debtors
       2010 2009 
       £’000 £’000
D u e w i t h in o n e y e a r
Prepayments and accrued income       21 284
Other debtors – leasehold rental deposit       30 200
Amounts due from subsidiary undertakings       339 –
       390 484
5. Creditors: amounts falling due within one year
       2010 2009 
       £’000 £’000
Bank overdraft       141 –
Trade creditors       154 33
Accruals and deferred income       120 1,500
Tax payable       – 1
       415 1,534 Advanced Medical Solutions Group
70   Advanced Medical Solutions Group plc Annual Report 2010
Notes to the Company Financial Statements continued
Y e a r   ended   3 1   Decem ber   2 0 1 0
6. Share capital
Details on the share capital of the Company are provided in note 31 to the Group’s accounts.
7. Reserves
    Share-based  Investment in Share Retained 
    payments own shares premium earnings Total 
    £’000 £’000 £’000 £’000 £’000
At 1 January 2010    502 (27) 99 2,866 3,440
Share-based payments    282 – – – 282
Share options exercised    (342) – 207 – (135)
Shares purchased by EBT    – (191) – – (191)
Shares sold by EBT    – 181 – – 181
Consolidated loss for the year    – – – (1,062) (1,062)
At 31 December 2010    442 (37) 306 1,804 2,515
8. Share-based payments
The charge for share-based payments under FRS20 arises across the following schemes: 
       2010 2009 
       £’000 £’000
Unapproved Executive Share Option Scheme and Enterprise Management Incentive Scheme    62 29
Long-Term Incentive Plan       101 101
Deferred Share Bonus Scheme       119 72
       282 202
Details on the share-based payments of the Company are provided in note 34 on page 62 in the notes to the Group’s accounts. 71 Advanced Medical Solutions Group plc Annual Report 2010  
    2010 2009 2008 2007 2006 
    £m £m £m £m £m
Condensed consolidated income statement (pre-exceptional items)
Revenue    31.9 24.1 20.3 16.9 14.3
Profit from operations    5.3 4.1 2.7 1.7 0.5
Finance income    – – 0.3 0.3 0.1
Profit attributable to equity holders of the parent    5.8 4.5 3.3 2.2 0.7
Basic earnings per share    3.8p 3.1p 2.3p 1.6p 0.5p
Condensed consolidated statement of financial position
N e t a s s e t s e m p l o y e d
Non-current assets    20.3 17.7 9.8 6.5 6.0
Current assets    12.7 12.1 14.7 12.7 10.0
Total liabilities    (5.2) (6.9) (4.6) (3.5) (3.0)
Net assets    27.8 22.9 19.9 15.7 13.0
Sh a r e h o l d e r s ’ e q u i t y
Share capital & investment in own shares    7.7 7.2 7.2 7.1 11.8
Share-based payments reserve    0.4 0.5 0.3 0.2 –
Share-based payments deferred tax reserve    0.4 0.6 0.6 0.3 0.1
Share premium account    0.3 0.1 – – 38.0
Other reserve    1.5 1.5 1.5 1.5 1.5
Translation reserve    – 0.3 0.4 – –
Retained equity    17.5 12.7 9.9 6.6 (38.4)
Equity attributable to equity holders of the parent    27.8 22.9 19.9 15.7 13.0
Five Year Summary Advanced Medical Solutions Group
72   Advanced Medical Solutions Group plc Annual Report 2010
Advisors
Nominated Advisor and Broker
Investec
2 Gresham Street, 
London EC2V 7QP
Auditor
Deloitte LLP
Chartered Accountants and
Statutory Auditor
P.O. Box 500, 
2 Hardman Street, 
Manchester M60 2AT
Solicitors
Wragge & Co
55 Colmore Row, 
Birmingham, B3 2AS
Registrars and Transfer Office
Capita Registrars
The Registry, 
34 Beckenham Road, 
Beckenham, 
Kent, BR3 4TU
Bankers
Lloyds TSB
Norfolk House, 
7 Norfolk Street, 
Manchester, M2 1DW
Patent Attorneys
Marks & Clerk
Manchester Office, 
Sussex House, 
83-85 Mosley Street, 
Manchester, M2 3LG
Foley & Lardner, LLC 
Building 3, Palo Alto Square, 
3000 El Camino Real, 
Palo Alto, CA 94306
Public Relations
Tavistock Communications
131 Finsbury Pavement, 
London, EC2A 1NT 73 Advanced Medical Solutions Group plc Annual Report 2010  
Notice is hereby given that the seventeenth Annual General Meeting of the Company will be held at 11.00 am on 8 June 2011 at Macdonald 
Portal Hotel, Cobblers Cross Lane, Tarporley, Cheshire, CW6 0DJ.
As ordinary business:
1. To receive the Report of the Directors and the Financial Statements of the Company for the year ended 31 December 2010 (together with 
the report of the auditor thereon).
2. To approve the Directors’ Remuneration Report for the year ended 31 December 2010.
3. To reappoint Deloitte LLP as auditor and to authorise the directors to fix their remuneration.
4. To re-elect Stephen Bellamy, (who retires by rotation in accordance with the Articles of Association) as a director of the Company.
5. To re-elect Dr. Don Evans, (who having been a director of the Company for more than ten years and is now Non-Executive Chairman, retires  
and is proposed for re-election each year) as a director of the Company.
6. To declare a final dividend of 0.38p per ordinary share, payable on 10 June 2011 to shareholders on the register at close of business on  
13 May 2011.
As special business:
To consider and, if thought fit, to pass Resolution 7, which will be proposed as an Ordinary Resolution, and Resolutions 8 and 9, which will be 
proposed as Special Resolutions.
7. To authorise the directors generally and unconditionally for the purposes of section 551 of the Companies Act 2006 (the ‘2006 Act’) to 
exercise all the powers of the Company to allot shares in the Company and to grant rights to subscribe for or to convert any security into 
shares in the Company (each an allotment of ‘relevant securities’) up to an aggregate nominal amount of £2,580,329 provided that this 
authority is for a period expriring upon the earlier of the date of the Company’s next Annual General Meeting and fifteen months after the 
date of the passing of this Resolution but the Company may before such expiry make an offer or agreement which would or might require 
relevant securities to be allotted after such expiry and the directors may allot relevant securities in pursuance of such offer or agreement 
notwithstanding that the authority conferred by this resolution has expired. This authority is in substitution for all subsisting authorities,  
to the extent unused.
8. Subject to the passing of resolution 7 above, to authorise the directors pursuant to section 570 of the 2006 Act to allot equity securities 
(within the meaning of section 560 of the 2006 Act) wholly for cash pursuant to the authority conferred by resolution 7 above as if section 
561(1) of the 2006 Act did not apply to any such allotment, provided that this power shall be limited to the allotment of equity securities:
(a) in connection with an offer of such securities by way of rights to holders of ordinary shares in proportion (as nearly as may be 
practicable) to their respective holdings of such shares, but subject to such exclusions or other arrangements as the directors may deem 
necessary or expedient in relation to fractional entitlements or any legal or practical problems under the laws of any territory, or the 
requirements of any regulatory body or stock exchange; 
(b) otherwise than pursuant to sub-paragraph (a) above up to an aggregate nominal amount of £774,098; and
(c) which shall expire on the earlier of the conclusion of the next Annual General Meeting of the Company and fifteen months after the date 
of the passing of this Resolution, save that the Company may before such expiry make an offer or agreement which would or might 
require equity securities to be allotted after such expiry and the directors may allot equity securities in pursuance of any such offer or 
agreement notwithstanding that the power conferred by this resolution has expired.
9. That the Company is hereby generally and unconditionally authorised for the purposes of Section 701 of the Companies Act 2006 (the ‘Act’) 
to make market purchases (within the meaning of Section 693(4) of the Act) of any of its ordinary shares of 5p each in the capital of the 
Company on such terms and in such manner as the directors may from time to time determine provided that:
(a) the maximum number of ordinary shares which may be purchased is 7,740,980;
(b) the minimum price which may be paid for each ordinary share is 5p which amount shall be exclusive of expenses, if any;
(c) the maximum price (exclusive of expenses) which may be paid for each ordinary share shall not be more than 5% above the average of 
the middle market quotations for an ordinary share as derived from The London Stock Exchange Daily Official List for the five business 
days immediately preceding the date on which the ordinary share is purchased;
(d) unless previously renewed, revoked or varied, this authority shall expire at the end of the 2012 AGM; and 
(e) under this authority the Company may make a contract to purchase ordinary shares which would or might be executed wholly or partly 
after the expiry of this authority, and may make purchases of ordinary shares pursuant to it as if this authority had not expired.
By order of the Board
M a r y T a v e n e r
Company Secretary
20 April 2011
Registered office:
Premier Park, 33 Road One, Winsford Industrial Estate,  
Winsford, Cheshire, CW7 3RT.
Notice of Meeting Advanced Medical Solutions Group
74   Advanced Medical Solutions Group plc Annual Report 2010
Notice of Meeting continued
Notes
1. A member entitled to attend and vote at the meeting convened by the notice set out above may appoint a proxy to attend, speak and,  
on a poll to vote in his place. A holder of more than one ordinary share may appoint different proxies in relation to each or any of those 
ordinary shares. 
2. A member may appoint more than one proxy provided each proxy is appointed to exercise rights attached to different shares. A member 
may not appoint more than one proxy to exercise rights attached to any one share. To appoint more than one proxy notice must be given  
to the Company’s Registrars not later than 48 hours before the time appointed for the holding of the meeting. 
3. A proxy does not need to be a member of the Company but must attend the meeting to represent you. Details of how to appoint the 
Chairman of the meeting or another person as your proxy using the proxy form are set out at note 1 of the proxy form. If you wish your proxy 
to speak on your behalf at the meeting you will need to appoint your own choice of proxy (not the Chairman) and give your instructions 
directly to them. 
4. On a vote on a resolution on a show of hands at the meeting, a proxy has one vote for and one vote against if the proxy has been appointed 
by more than one member and the proxy has been instructed by one or more of the members to vote for the resolution and by one or more 
other member to vote against it.
5  Any corporation which is a member can appoint one or more corporate representatives who may exercise on its behalf all of its powers as  
a member provided that they do not do so in relation to the same shares.
6. A form of proxy is enclosed for use by members. To be effective, it must be completed and arrive not later than 48 hours before the time 
fixed for the Meeting at Capita Registrars, PXS, 34 Beckenham Road, Beckenham, Kent BR3 4TU. You may also deliver by hand to The Registry, 
34 Beckenham Road, Beckenham, Kent BR3 4TU during usual business hours.
7.  The register of directors’ interests in the shares of the Company will be available for inspection at the registered office of the Company 
during usual business hours on any weekday (public holidays excepted) until the date of the Meeting and also on that date and at the place 
of the Meeting from 9.00 a.m. until the conclusion of the Meeting.
8  The Company, pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001, specifies that only those shareholders registered 
in the Register of Members of the Company as at 6:00 p.m. on 6 June 2011 shall be entitled to attend or vote at the aforesaid Annual General 
Meeting in respect of the number of shares registered in their names at that time. Changes in the entries in the relevant register of Securities 
after 6:00 p.m. on 6 June 2011 shall be disregarded in determining the rights of any person to attend or vote at the meeting.
Notes on special business
R e s o l u t i o n 7 : A u t h o r i t y t o A ll o t Sh a r e s a n d o t h e r r e l e v a n t s e c u r i t i e s
This resolution would give the directors the authority to allot ordinary shares up to an aggregate nominal amount equal to £2,580,329 
(representing 51,606,580 ordinary shares of 5p each). This amount represents approximately one-third of the issued ordinary share capital of the 
Company as at 20 April 2011, the latest practicable date prior to publication of this Notice.
The authority sought under this resolution will expire at the conclusion of the annual general meeting of the Company held in 2012 or, if earlier, 
15 months after the passing of the resolution.
While the Directors have no present intention of issuing any of the authorised but unissued share capital, it is considered prudent and 
appropriate to maintain the flexibility that this authority provides.
R e s o l u t i o n 8 : D i s a p p li c a t i o n o f P r e - e m p t i o n R i g h t s 
Your directors also require additional authority from shareholders to allot shares or grant rights over shares or sell treasury shares where they 
propose to do so for cash and otherwise than to existing shareholders in proportion to their existing holdings. Accordingly, Resolution 8 will be 
proposed as a special resolution to grant such authority. Apart from rights issues, open offers or any other pre-emptive offer as mentioned the 
authority will be limited to the issue of shares and sales of treasury shares for cash up to an aggregate nominal value of £774,098 (being 10% of 
the Company’s issued ordinary share capital at 20 April 2011, the latest practicable date prior to publication of this Notice). This is in keeping with 
the extent for which such authority has been sought and given at each previous Annual General Meeting of the Company since 2006. 
Allotments made under the authorisation in paragraph (a) of Resolution 8 would be limited to allotments by way of a rights issue only (subject to 
the right of the directors to impose necessary or appropriate limitations to deal with, for example, fractional entitlements and regulatory 
matters). 
If given, this authority will expire at the conclusion of the annual general meeting of the Company held in 2012 or, if earlier, 15 months after the 
passing of the resolution. 75 Advanced Medical Solutions Group plc Annual Report 2010  
Notes on special business continued
R e s o l u t i o n s 9 : P u r c h a s e b y t h e C o m p a n y o f i t s o w n Sh a r e s 
In certain circumstances, it may be advantageous for the Company to purchase its own shares. Under Section 701 of the Companies Act 2006, 
the directors of a company may make market purchases of that company’s shares if authorised to do so. Your directors believe that granting 
such approval would be in the best interests of shareholders in allowing directors the flexibility to react promptly to circumstances requiring 
market purchases.
Accordingly, Resolution 9, which will be proposed as a special resolution, will give the directors the authority to purchase issued shares of the 
Company under Section 701 of the Companies Act 2006. 
The authority contained in this resolution will be limited to an aggregate nominal value of £387,049 (representing 5% of the issued ordinary 
share capital of the Company as at 20 April 2011 the latest practicable date prior to publication of this Notice; representing 7,740,980 ordinary 
shares of 5p each). The price which may be paid for those shares is also restricted as set out in the resolution. 
This authority will expire at the conclusion of the annual general meeting of the Company held in 2012.
The Board has no present intention of exercising this authority. However, this will be kept under review, and the Board will use this power only if 
and when, taking account of market conditions prevailing at the time, other investment opportunities, appropriate gearing levels and the overall 
financial position of the Group, they believe that the effect of such purchases will be in the best interests of shareholders generally and that they 
will result in an increase in earnings per share.
Shares purchased under this authority may be held as treasury shares. The Company may purchase and hold shares as treasury shares up to a 
maximum equal to 10% of the nominal value of the issued ordinary share capital at that time, rather than cancelling them. Shares held in 
treasury do not carry voting rights and no dividends will be paid on any such shares. Shares held in treasury in this way can be sold for cash or 
cancelled. This would allow the Company to manage its capital base more effectively and to replenish its distributable reserves.
If and when the Board resolves to exercise its authority to make market purchases, it will at that time decide whether shares purchased are to be 
cancelled or held in treasury. 
As at 20 April 2011, the latest practicable date prior to publication of this Notice, there were share options outstanding over ordinary shares, 
representing 4.6 % of the Company’s issued ordinary share capital. The Company has no warrants in issue in relation to its shares. If the buyback 
authority was to be exercised in full, these options would represent 5.1% of the Company’s ordinary issued share capital. Advanced Medical Solutions Group
76   Advanced Medical Solutions Group plc Annual Report 2010
Notes 0
200
400
600
800
1000
Feb-11 Aug-10 Feb-10 Aug-09 Feb-09 Aug-08 Feb-08 Aug-07 Feb-07 Aug-06 Feb-06
Advanced Medical Solutions 
FTSE All Share 
FTSE Techmark All Share 
FTSE ALL Share Healthcare 
FTSE Small Cap  
FTSE AIM All Share
 
 UK £8.3m
 Europe £13.8m
 USA £9.2m
ROW £0.6m
Sales by Geographic Sector
 Woundcare
£25.2m
Wound closure
and sealants
£6.7m
Sales by Market Sector
 
 UK £8.3m
 Europe £13.8m
 USA £9.2m
ROW £0.6m
Sales by Geographic Sector
 Woundcare
£25.2m
Wound closure
and sealants
£6.7m
Sales by Market Sector
new world class facility 
in Winsford, Cheshire
138,500sq ft
>  Accelerating healing 
and managing wounds
>  Minimising adverse 
surgical outcomes
>  Sealing and closing  
tissue
With our broad range of applications 
and multiple technology platforms, 
AMS has created a unique 
market position.
We develop, manufacture and market 
innovative products in the areas of:
Advanced Medical Solutions Group at a glance
258 
Employees
Five Year Relative Share Price Performance Sales by Geographic Sector
Sales by Market Sector Advanced Medical Solutions Group plc
Annual Report and Accounts 2010
Advanced Medical Solutions Group plc Annual Report and Accounts 2010
Registered Office:
Premier Park, 33 Road One
WInsford Industrial Estate
Winsford, Cheshire, CW7 3RT
Company Number: 2867684
Tel: +44 (0)1606 863500
Fax: +44 (0)1606 863600
e-mail: info@admedsol.com
Web: www.admedsol.com
is a global business providing 
innovative products and brands in 
the areas of accelerating healing 
and managing wounds, minimising 
adverse surgical outcomes and 
sealing and closing tissue.
•Applied Innovation
•Manufacture
•Supply
Advanced Medical Solutions Group 
 1 Highlights
 2 Overview
10 Business Review: Strategic Overview
12 Business Review: Chairman’s Statement
14 Business Review: Chief Executive Officer’s Report
17 Business Review: Group Finance Director’s Report
20 Directors
22 Management Team
24 Corporate Governance Standing Committees
25 Report of the Directors
29 Remuneration Report
32 Corporate Governance
35  Independent Auditor’s Report to the members of 
Advanced Medical Solutions Group plc
36 Consolidated Income Statement
36 Consolidated Statement of Comprehensive Income
37 Consolidated Statement of Financial Position 
38 Consolidated Statement of Changes in Equity
39 Consolidated Statement of Cash Flows
40  Notes Forming Part of the Consolidated  
Financial Statements
67 Company Balance Sheet
68 Notes to the Company Financial Statements
71 Five Year Summary
72 Advisors
73 Notice of Meeting