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INTELEK plc
Annual Report 
and Accounts
 for the year ended 31 March 2009
Intelek
Report and Accounts 2009
 INTELEK plc Report and Accounts for the year ended 31 March 2009
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Intelek
Report and Accounts 2009
 www .intelek.plc.uk
Stock exchange code: ITK
 Intelek designs and manufactures
electronic systems for satellite 
and microwave communications 
and is a specialist manufacturer 
for the aerospace market.
 Gr oup Highlights 1
Group Overview 2
Chairman’s Statement 4
Chief Executive’s Review 6
Financial Review 18
Directors and Senior Executives  20
Directors’ Report 21
Statement of Directors’ Responsibilities 24
Corporate Governance Report 25
Remuneration Report 29
Auditor’s Report  32
Consolidated Income Statement 33
Consolidated Statement 
of Recognised Income and Expense 33
Consolidated Balance Sheet 34
Consolidated Cash Flow Statement 35
Notes to the Financial Statements 36
Five Year Summary 57
Company Balance Sheet 58
Notice of Annual General Meeting 61
Glossary 64
Group Company Addresses and Advisers IBC
 Introduction to the markets
and operations of the Group
 Strategy and prospects
Divisional analysis;
achievements and aims
 Glossary of technical terms
Welcome to Intelek plc
Registered Office
Intelek plc
PO Box 25, South Marston Park, 
Swindon, Wiltshire, SN3 4TR
Tel: (01793) 827000
Fax: (01793) 827578
e-mail: info@intelek.plc.uk
Website: www.intelek.plc.uk
CML Group Limited
Price Street, Birkenhead, 
Wirral, CH41 3PT
Tel: (0151) 647 5531
Fax: (0151) 650 0668
e-mail: enquiries@cml-group.com
Website: www.cml-group.com
Auditors
Grant Thornton UK LLP
Chartered Accountants
Enterprise House, 115 Edmund Street,
Birmingham, B3 2HJ
Solicitors
DLA
Victoria Square House,
Victoria Square, Birmingham, B2 4DL
Labtech Limited*
Unit 1, Broadaxe Business Park, 
Presteigne, Powys, LD8 2UH
Tel: (01544) 260093
Fax: (01544) 260310
8 Vincent Avenue, 
Crownhill, Milton Keynes, MK8 0AB
Tel: (01908) 261755
Fax: (01908) 261788
e-mail: sales@labtech.ltd.uk
Website: www.labtechcircuits.com
* Held directly by Intelek plc.
Bankers
Barclays Bank PLC 
Park House, Stoke Gifford, 
Bristol, BS34 8TN
Sovereign Bank 
2790 West College Avenue, Suite 800, 
State College, PA 16801, USA
Paradise Datacom
Paradise Datacom Ltd*
1 Wheaton Road, Witham,
Essex, CM8 3UJ
Tel: (01376) 515636
Fax: (01376) 533762
e-mail: sales@paradise.co.uk
Paradise Datacom LLC
328 Innovation Boulevard,
Suite 100, State College, 
PA 16803, USA
Tel: (001) 814 238 3450
Fax: (001) 814 238 3814
e-mail: sales@paradisedata.com
Website: www.paradisedata.com
Stockbrokers/Nomads
Altium Capital Limited
30 St James’s Square,
London, SW1Y 4AL
Registrars 
and Transfer Office 
Equiniti Limited
The Causeway, Worthing, 
West Sussex, BN99 6DA
Trading Subsidiaries
Advisers
Group Company Addresses
16329INTELEK_CVR.indd   2 23/07/2009   09:46 01 www.intelek.plc.uk
16329 22/07/2009 Proof 6
Group
Highlights
01
Financial
 n Sales up 9% to £39.3 million (2008: £36.0 million)
n Underlying PBT up 23% to £4.1 million (2008: £3.3 million)
n Underlying EPS up 19% to 3.32p (2008: 2.78p)
n Full year dividend increased to 0.465p (2008: 0.45p)
n Sound ﬁnancial structure, interest cover 19 times
Operational
 n Record results in core business, Satellite Communications
n Microwave components sales boosted in defence and air trafﬁc control
n Strong performance in Aerospace, with increased sales to defence sector
16329INTELEK.indd   1 23/07/2009   13:33 Intelek
Report and Accounts 2009
02
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Group Overview
Group
Overview
“Intelek designs and manufactures products for markets with exciting long-term
growth potential. We have an established presence in satellite communications, 
mobile telephony infrastructure, defence, security and aerospace.”
Satellite communications
Paradise Datacom
Sales £18.3 million
Operating Proﬁt £3.6 million
Market:
The global Satellite Communications market is estimated at over 
£50 billion, growing at about 8% a year. We operate in the ground 
equipment portion of this market. Including products under 
development, our addressable market is estimated at just under 
£300 million.
Presence:
Design centres in the UK and in the USA, with a headcount of 119.
Global sales network, centred in the USA, with ofﬁ ces in the UK
and Asia.
Products:
Data transmitted by satellite has to be picked up at ground stations, 
processed through modems and boosted in power by ampliﬁers
to make the 20,000 mile trip to the satellite, before being returned 
elsewhere to earth, where the data is unscrambled through modems 
and distributed. Paradise Datacom has designed a leading range 
of modem and ampliﬁ er related equipment, all using solid state,
digital technology.
Target sectors:
n Security and defence
n Oil, gas and minerals 
exploration
n HD television
n Countries without 
ﬁxed line infrastructure
n Internet trafﬁ c
— video, voice, etc.
n GSM backhaul
Major customers:
n UK, US and other governments
n Telcom majors
n Oil & gas operators
n Satellite news gathering agencies
Geographical
Turnover: £39 million
UK £16 million
USA £7 million
Europe £7 million
Rest of World £9 million
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16329 22/07/2009 Proof 6
Sales by Division:
Satellite Communications
Paradise Datacom
 Micr owave
components 
and manufacturing 
services
 Labtech Microwave
Aerostructures
CML
Market:
Microwave circuits and components have applications in most
electronic devices and the global market is immense. Labtech 
targets the higher frequency and higher complexity products. 
Our estimated addressable market is £250 million. Labtech is 
transitioning from volume telecom sales to more complex 
products and services.
Market:
It is estimated that aircraft worth $1,000 billion will be required in
the next 10 years. CML has over 60 years’ experience supplying 
aerospace components, principally into the commercial sector. CML 
is steadily increasing sales in the defence sector, providing a hedge 
against cyclical market changes.
Presence:
PCB processing plant in mid-Wales and a component design facility
in Milton Keynes, with a headcount of 97. Global sales distribution 
network, headquartered in the UK.
Presence:
Located in Birkenhead with headcount of 204. Main sales are
within UK.
Products:
Build-to-print Microwave PCBs
 The thermal and performance characteristics needed for
microwaves require skilful use of metals and chemistry
Assembly and test of microwave products
The technical skills at the two sites combine to provide leading
edge product support
Components for defence applications
 Almost 20 years’ experience in design of high-end broadband
microwave components for defence
Products:
Build-to-print service providing:
Precision machined aluminium and titanium parts for wings,
landing gear and other aircraft structure
Composite material parts for ducting, access doors, etc.
Sheet detail, providing trims and other metal aircraft features
Target sectors:
n Defence
n Radar
n Security (airport screening etc.)
n Air trafﬁc control
n Mobile telecom 
infrastructure
n Space and satcom
Target sectors:
n Commercial jets
n Business and regional jets
n Helicopters
n Military aircraft
Major customers:
n Defence OEMs
n Mobile telecom OEMs
n Air trafﬁc control OEMs
Major customers:
n Airbus
n GKN
n BAE Systems
n Hawker Beechcraft
Sales £7.3 million
Operating Proﬁt Breakeven
47% 18% 35%
Sales £13.9 million
Operating Proﬁt £2.0 million
Labtech Microwave CML
Microwave components
and manufacturing services
Aerostructures
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Report and Accounts 2009
04
Chairman’s
Statement 
David Bramwell
16329 22/07/2009 Proof 6
Chairman’s Statement
 Intr oduction
I am pleased to report further significant
improvement in the performance of the
Group during a year which witnessed
an unprecedented assault on the
economic and financial framework
of the industrialised world. Although we
have been by no means immune to the
global downturn, particularly in our final
quarter, we nevertheless finished the
year in line with market expectations
with underlying profit before tax at
£4.1 million, some 23% higher than
the previous financial year.
Results
Sales for the financial year increased
by 9% with the dollar rebounding to
account for £2.7 million of our year on
year growth in sales. Overall margins
held up well, with gross margins of
32% of sales (2008: 31% of sales).
The strengthening dollar contributed
to £0.5 million of the £0.8 million
improvement in underlying profit
before tax. Earnings per share from the
underlying profit of the Group improved
by 19% to 3.32p and net debt reduced
to £3.8 million, despite the strengthening
of the US dollar. This was largely due
to the record performance of Paradise
Datacom and CML, with operating profit
for both companies being 15% higher
than the previous year.
The strengthening dollar had the
opposite effect on borrowings, much of
which is denominated in dollars as a net
investment hedge. Borrowings reduced
by £0.7 million before increasing
£0.6 million for currency changes.
Paradise Datacom, our satellite amplifier
and modem business, had a successful
year, opening new engineering and
sales offices in Beijing, Bangkok and
Phoenix, Arizona. A number of significant
government product replacement
programmes were won which will benefit
Paradise Datacom for the next two to
three years. Our increased rate of new
product introduction and our extended
geographic coverage enabled Paradise
Datacom to record a further year of a
return on sales in excess of 20%.
Labtech Microwave, our microwave
components and manufacturing services
business, saw the expected reduction
in commercial telecommunication
sales offset by growth in defence and
security sales, though some of the
larger programmes we had expected
were delayed into 2009/10. Our share
of the phased array radar market has
continued to grow, with air traffic control
demand also showing promise. Our
continued reduction in exposure to the
commodity telecommunications markets
was replaced by specialist work enabling
Labtech Microwave to break even in
the year. We are still in the process of
reshaping the business to increase
intellectual property, make it more
responsive, leaner and set for growth.
This led to an exceptional restructuring
charge in the year of £0.4 million, which
includes an impairment charge for
surplus assets.
CML, our aerostructures company,
continued its run of improving operating
profit. Towards the end of the financial
year the general economic downturn
began to affect the schedules for
business and commercial jets. However,
there were positive advances being
made on the development programme
for Composites with additional orders
under the Joint Strike Fighter (JSF)
programme. Repairs and overhaul, a
higher margin area of activity, was also
a successful sector for CML in the past
12 months.
Dividend
The Board considers it prudent in the
current economic climate to maintain
the final dividend at 0.30p. This brings
the total dividend for the year to 0.465p
(2008: 0.45p). If approved at the Annual
General Meeting on 11 September 2009,
the final dividend will be paid on
23 September 2009 to shareholders
on the register at the close of business
on 28 August 2009.
“Further significant improvement in performance.
Difficult commercial backdrop but we are confident of 
resilient performance in the coming financial year.”
Chairman’s
Statement 
David Bramwell
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16329 22/07/2009 Proof 6
05
Strategy
Our strategy is to develop our business
in the communications industry providing
technology for the transmission of voice,
video and data. Our focus is on the
defence, security, telecommunications
and broadcast sectors. We will also
continue to develop our profitable
aerostructures business. The Group
will grow organically within our chosen
markets through sound investment in
product development, capital equipment
and enhanced geographic coverage.
We will continue to encourage the
professional development of our staff,
enhanced, where necessary, by the
recruitment of key additional personnel
with complementary skills. In order to
supplement organic growth, we will
seek suitable acquisitions within our
core activity.
People
The skill, commitment and enthusiasm
of our employees are key to the ongoing
success of the Group. On behalf of the
Board, I would like to record my sincere
thanks to them for their loyalty and
valued contributions during the year.
Outlook
The extended geographic sales coverage
and the increased rate of new product
introduction will open up significant
new markets for Paradise Datacom,
though we may have to be patient
before seeing growth in the current
economic conditions. We expect some
considerable softening in commercial
satcoms in 2009/10 and will be
more reliant on winning contracts on
Government programmes, where
funding is still robust and increasing.
We are currently bidding on an extensive
range of programmes of considerable
value and will look to build on our
proven success in this area. In all, we
are projecting to maintain the sales level
following a slow start to the year which
we anticipate will gather momentum
towards the final quarter.
Labtech Microwave has seen some
strong order inflow in the first two
months of the current year and, although
activity levels will remain low in the first
six months, our restructuring should
be sufficient to enable a reasonable
profit at the half way stage. Due to the
nature of Labtech Microwave’s growing
focus on defence spend, the visibility
of programmes is much longer than it
was some two to three years ago. As a
consequence, the second six months of
the current year also look to be profitable
although the timing of order placement
on some of the defence and security
programmes, as ever, is critical.
In line with most aerospace suppliers
CML has suffered a significant reduction
of build rates in the corporate jet
market, whilst Airbus’ schedules remain
comparatively resilient. Overall, the
reduced business jet build schedule and
the investment in moving to an enlarged
composite facility will undoubtedly result
in a lowering of CML’s profits in 2009/10.
However, over the medium to long-term,
this new facility will allow us to capitalise
on significant opportunities in the
aerospace composites market, including
servicing the JSF build, the world’s
largest military jet programme.
Across the Group we have taken early
action to improve efficiency and reduce
costs against a difficult commercial
backdrop. Although CML is likely to
record a drop in revenues, we expect
Labtech Microwave to make good
progress in the current year. This,
together with the underlying strength
of Paradise Datacom and a reduction
in head office costs, gives us confidence
for a resilient performance in the coming
financial year.
David Bramwell
Chairman
10 June 2009
Paradise Datacom is supplying X-band amplifiers to the Norwegian Navy (©Torbjørn Kjosvold/The Norwegian Armed Forces)
16329INTELEK.indd   5 23/07/2009   13:33 Intelek
Report and Accounts 2009
06
16329 22/07/2009 Proof 6
Chief
Executive’s
Review 
Ian Brodie
 Chief Executive’s Review
Intelek recorded an encouraging
performance in what was a turbulent
year in terms of the global economy.
Underlying profit before tax increased by
23% on a sales increase of 9% on the
previous year. Our strategy of targeting
Government sectors, adopted across
all our three businesses after the last
downturn, has proved to be successful,
particularly so in the last twelve months.
n In satellite communications, Paradise
Datacom’s sales were 20% ahead
of last year, helped substantially
by the improved dollar exchange
rate and by Government/military
programmes that offset the global
softening of demand for commercial
telecoms. The prospects for satellite
communications remain exciting
with strong fundamental drivers:
progression towards HDTV,
increased use of the internet, a
strong demand from the defence
sector and the spread of mobile/
cellular telephony in developing
countries.
n In microwave components, Labtech
continued its strategic transformation
into a defence and air traffic control
components business, replacing
former telecommunications sales
with new orders from Government
equipment manufacturers, including
£2.3 million of orders for phased
array radar systems.
n In aerospace, CML won further
business on the world’s largest
military jet programme, the Joint
Strike Fighter, and benefited
from increased sales from our
core customer base where we
have a number of long-standing
relationships.
“An encouraging performance in a turbulent year.
The Group remains well positioned and we look to 
the future with confidence.”
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16329 22/07/2009 Proof 6
Labtech Microwave has won large contracts for air traffic control (©Raytheon)
16329INTELEK.indd   7 23/07/2009   13:33 Intelek
Report and Accounts 2009
08
16329 22/07/2009 Proof 6
Chief Executive’s Review continued
Satellite
communications
Paradise Datacom 
John Restivo President
 Sales £18.3 million (2008: £15.3 million)
Operating Profit £3.6 million (2008: £3.2 million)
Paradise Datacom has a global
presence, headquartered in State
College, Pennsylvania and with
additional locations in Essex (UK),
Atlanta (Georgia), Phoenix (Arizona),
Beijing (China) and Bangkok
(Thailand), and representatives in
all other major territories. Paradise
Datacom manufactures a broad
range of products that are used in
satellite-based telecommunications
systems. Satellite communications
is a multi $billion industry. Paradise
Datacom serves the ground station
portion, supplying a market currently
estimated at $400 million.
Satellites provide a unique benefit
to telecommunications operators in
that they lack many of the obstacles
faced by terrestrial-based alternatives,
including point-to-point microwave
towers, pole-mounted copper
cables and optical fibre. With an
unobstructed view of the satellite,
a ground terminal can be installed
quickly and with relative ease allowing
links and networks the ability to “go
live” with minimal difficulty and delay.
In a point-to-multipoint scenario,
where a large area such as an entire
continent is the target recipient of a
voice, video or data service, satellite-
delivery as a broadcast medium
is virtually unchallenged. Satellites
are critical for mobile applications
such as satellite news gathering
(SNG) vehicles and military flyway
terminals. The global demand for
ever increasing volumes of data, for
example for high definition, internet
and remote monitoring and control,
drive investment in new technologies.
Paradise Datacom products cover
essential elements used in most
satellite ground stations and provide
new technological solutions with
continuous investment in research
and development.
The diverse Paradise Datacom
product portfolio is broken into
two basic categories and includes
both radio-frequency (RF) products
and satellite modems. Satellite
modems manufactured by Paradise
Datacom have been expanded into
three product lines consisting of
Evolution, Vision and the most recent
introduction, Quantum. Evolution
addresses conventional point-to-point
applications; Vision targets Digital
Television Broadcast operators;
Quantum, the Company’s most
sophisticated and versatile modem,
incorporates elements of both
Evolution and Vision as well as a host
of other unique features pioneered by
Paradise Datacom.
Since satellite lease charges can
represent up to 30% of a network
operator’s running costs, products
and technologies that provide
bandwidth savings are in great
demand. In mid 2009/10, Paradise
Datacom will begin shipping modems
with two new technologies, Sat-Abis,
an optimiser for cellular network
operators, and ViaSat’s patented
Paired Carrier Multiple Access
(PCMA) technology embedded.
PCMA allows satellite ground station
operators the potential to cut their
satellite lease costs in half, by
overlapping both the transmit and
the receive carriers to transmit data,
using echo cancellation.
Paradise Datacom’s RF product range
is one of the most extensive available
in the industry. It consists of solid
state power amplifiers (SSPAs) with
output power levels from 10 watts
to 8,000 watts, Block Upconverters
(BUCs) and low-noise amplifiers
(LNAs). Recent product innovations
include PowerMAX, vBUC, Gallium
Nitride-based SSPA module
architectures and an expanding range
of Ka-band amplifiers. These ensure
a continuation of Paradise Datacom’s
position at the forefront of technology
and developments in the satellite
amplifier market.
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Sales/Head ($000)
Paradise Datacom produced another
record performance with profit up by
15%, helped by the strengthening of the
US$ where the average rate of $1.71/£
compared favourably with the prior
year average of $2.01/£. Sustained by
Government business in many countries
across the world, Paradise Datacom’s
dollar sales increased by 2% despite
the weakening commercial market.
With margins steady at 20% of sales,
2008/09 recorded an impressive financial
performance especially when taking
into account the additional investment
made in front-end sales resources and
increased engineering capability.
During the past year, as part of an
ongoing effort to increase market share
and expand brand recognition, Paradise
Datacom opened engineering and sales
offices in Thailand and China and a
service centre in India. This has resulted
in greater visibility of regional sales
opportunities and has given Paradise
Datacom access to large-scale operators
who require a local presence in order
to provide product repair, operational
training and post-sales support. As a
consequence, sales to the territories
covered by these offices increased by
£1.5 million in 2008/09.
In addition to the Asian expansion, an
engineering facility was established in
Phoenix, Arizona enabling Paradise
Datacom to capitalise on the abundance
of local engineers with skills relevant
to Paradise Datacom’s market focus.
These new facilities complement our
existing operations in State College,
Pennsylvania.
Paradise Datacom’s modem range has
been expanded and now consists of
Evolution, Vision and the most recent
introduction, Quantum. The Evolution
modem addresses conventional point-
to-point applications including open
network standards i.e. international
business services and backhaul links
such as those used in cellular networks.
The Vision modem targets Digital
Television Broadcast operators and
meets global digital video broadcasting
standards (DVB-S/DVB-S2). Quantum,
our most sophisticated and versatile
modem, incorporates elements of both
Evolution and Vision as well as a series
of integrated test and monitoring facilities
pioneered by Paradise Datacom, that are
accessible remotely via the internet.
Our facility in State College in the
USA has also broadened its range of
amplifiers to meet the ever changing
demands being placed on the satellite
communications industry by government
and commercial customers. The
introduction into operational service of
the first two Wideband Gapfiller satellites,
with the forecast of up to a dozen more,
has released what is certain to be a
significant rise in the demand for X and
Ka-band products by US and foreign
government agencies who already
account for more than 50% of Paradise
Datacom’s business.
Key Performance Indicators
Three key ratios for each of the operating companies 
have been selected to highlight performance movement 
in the last three years with brief explanatory comments 
where necessary.
(a) Sales per head reduced slightly following the next 
phase of investment in sales and engineering 
resources.
(b) The 2008 stock level was unusually low given the
demands of the industry for fast response.
Nevertheless, the 2009 level is higher than planned
and should be reduced during the first half of 2009/10.
(c) Strong margins continued the excellent record of 
return on capital employed.
Stock turns per annum
5
4
3
2
1
0
2007 2008 2009
350
300
250
200
150
10 0
 0
2007 2008 2009
Return on Capital Employed (ROCE) excluding goodwill
120
100
80
60
40
20
0
2007 2008 2009
Paradise Datacom amplifier mounted on a military communications vehicle Paradise Datacom’s amplifiers on board one
of the new Galileo installations
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Report and Accounts 2009
16329 22/07/2009 Proof 6
Chief Executive’s Review continued
10
Satellite
communications 
Paradise Datacom
Some of the major programmes won
by Paradise Datacom during the year
included:
n A multi-year retrofit programme for
government transportable earth
stations using C, Ku and X-band
SSPAs was perhaps the most
significant award. Approximately
$2.2 million has been shipped to date
with significant follow-on anticipated
during the course of the current
calendar year.
n A $2 million order was received at the
end of the financial year from a major
US systems integrator for the initial
phase of a large NATO programme.
n Europe’s Galileo and China’s
Compass global positioning satellite
networks placed orders for ground
control amplifiers for their satellite
constellations totalling approximately
$1 million.
n A major satellite system operator
in Asia purchased $1.5 million in
high-power solid state amplifiers to
replace ageing tube amplifiers, with
another $0.5 million pending.
n An IP network operator in Western
Canada has also begun placing
orders for Paradise Datacom SSPAs
to replace existing products, with
total orders expected to surpass
$1 million in 2009.
n In addition, two of our recently
released products, the Quantum
modem and the vBUC amplifier, are
currently undergoing evaluation for
a significant upgrade to an existing
network in Alaska.
Paradise Datacom has one of the most
extensive product offerings of any SSPA
(solid state power amplifier) and Modem
manufacturer in the industry. Recently
released product innovations should
ensure a continued increase in RF market
share. These include PowerMAX, the
highest power, most versatile SSPA on
the market, vBUC (Block Up Converters)
and the incorporation of the latest high-
power components (Gallium Nitride)
into a new range of SSPA modules. In
addition, Paradise Datacom will soon
be launching an expanded range of Low
Noise Amplifiers (LNAs) and Ka-band
SSPA product lines. On the satellite
modem side, attention will be focused
on products that optimise bandwidth,
giving customers significant cost
savings. Sat-Abis, for cellular backhaul
applications, has been released recently,
and Paired Carrier Multiple Access
(PCMA) is expected to be launched mid-
year 2009/10, under licence from ViaSat.
Paradise Datacom will continue to
update its product portfolio to meet the
needs of the customer base it serves.
The new feature-rich Quantum modem, with bandwidth saving
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11
Microwave components
and manufacturing 
services
Labtech Microwave
Brian Mazonas Managing Director
 Sales £7.3 million (2008: £7.9 million)
Operating Profit £ Breakeven (2008: £0.2 million)
Labtech Microwave specialises in the
manufacture of advanced microwave
electronic printed circuit boards and
the design, manufacture, assembly and
test of MMIC (monolithic microwave
integrated circuits) packages and
microwave components. Microwave
circuits and components are
manufactured in prototype and
medium to high volumes for major
defence, telecommunication, ATC
(air traffic control) and space system
customers worldwide.
Labtech Microwave’s extensively
equipped printed circuit boards
processing plant is based in a purpose-
built facility in Presteigne, Wales and its
component design and build facility is in
Milton Keynes.
Labtech Microwave’s printed circuit
board technology is focused on the
processing of high performance
PTFE (Teflon) microwave substrates
with plated through holes and high
specification wire bondable plating
finishes. Circuit layers can be bonded
together in a multilayer construction
and include precision machined metal
backing for high frequency applications
such as broadband digital radio links,
microwave power amplifiers and
phased array radar antennas. The
printed circuit board technology covers
applications from low microwave
frequencies (~1GHz) to millimetre-
wave frequencies (up to 94GHz) where
circuit feature tolerances require the
most advanced processing techniques
including laser profiling.
Labtech Microwave exploits its 20
years experience in design and
manufacture of a range of high-end
broadband microwave components
mainly for the European defence
market. Using high accuracy thin
film ceramic circuit manufacturing
capability, Labtech Microwave
produces multioctave microwave
amplifiers, switches and detector log
video amplifiers (DLVAs). In the last
3 years or so Labtech Microwave,
utilising the latest microwave circuit
technology at Presteigne, has
embarked on a plan to develop
a broad range of components to
address key market sectors. Products
including DLVAs, amplifiers and
switches have been established
and are being routinely sold into
the defence markets. Development
work started during the year to
produce a Ka-Band LNA for the
SatCom market which is being
marketed by Paradise Datacom.
The combination of precision
circuit machining (including laser
technology), advanced automatic
chemical processing and component
design, assembly and test gives
Labtech Microwave a leading world-
class capability. By integrating these
capabilities Labtech Microwave is able
to address successfully the emerging
markets of MMIC packaging and
phased array radar where the ability to
manufacture and test these advanced
microwave circuits is key.
High precision, nickel-gold plated 
microwave circuit
16329INTELEK.indd   11 23/07/2009   13:33 Intelek
Report and Accounts 2009
 Chief Executive’s Review continued
16329 22/07/2009 Proof 6
12
Microwave components
and manufacturing 
services 
Labtech Microwave
During the year, Labtech Microwave
continued its transformation into a
defence and air traffic control (ATC)
components business with both these
key market segments showing significant
growth. As anticipated, sales into the
telecom radio link market reduced
by nearly 25% year on year which
resulted in overall sales reducing by
£0.6 million. The second half of the
year was progressively affected by
the worsening economic conditions,
particularly in the commercial telecoms
market. In addition, the order placement
of a large defence contract and the start
of a substantial ATC project were delayed
to the end of the year which resulted
in a break-even on trading profit
(2008: £0.15 million). The 12 month
book to bill has been maintained
at 1.06:1.
Further important contract wins in the
European AESA/Phased Array radar
market amounted to £2.3 million, of
which £1.2 million was shipped during
the year. These radars are becoming
the preferred option for military use
as they offer significant weight and
cost advantages when compared with
mechanically steered radars and provide
the very high performance capability
needed for today’s military operations.
Management estimate that the total
annual market is $2 billion and it is
forecast to grow at 20% per annum.
Labtech Microwave’s addressable
portion of this market is estimated
at £80 million. Our multilayer printed
circuit boards are manufactured at the
Presteigne site and then assembled and
tested at the Milton Keynes location.
This integrated capability has proved
to have significant market appeal with
Labtech Microwave now involved in
many key phased array programmes
throughout Europe.
Labtech Microwave has also enhanced
its position in other areas of the defence
market via its ranges of amplifiers,
specialist microwave switches and
Sales/Head (£000)
Key Performance Indicators
(a) Sales per head were affected by the continued 
reduction in volume telecommunications business.
(b) Labtech carries a relatively low level of stock, 
though this has increased as a consequence of the 
increase in defence and component sales.
(c) Break-even result for the year.
100
80
60
40
20
0
2007 2008 2009
Stock turns per annum
8.0
7.0
6.0
5.0
4.0
3.0
2.0
1.0
0
2007 2008 2009
ROCE
4
2
0
-2
-4
-6
-8
-10
2007 2008 2009
The Artisan Radar, a future project for Labtech Microwave (©BAe Systems)
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13
crystal polymer substrates, are now 
routinely used especially for millimetre 
wave applications (e.g. 60 and 94GHz) 
for very high capacity radio links and 
highly sensitive detectors in the security 
and industrial markets.
The business also continues to pursue 
opportunities in other microwave 
markets as it moves away from the 
commodity driven telecom business. 
During the last year, Labtech Microwave 
has substantially increased its sales of 
specialist microwave circuits into the air 
traffic control market - for both defence 
and commercial applications. Towards 
the end of the financial year, Labtech 
was awarded a contract which will lead 
to significant business growth in this 
market sector. Orders to date under 
this contract have already exceeded 
£1 million. As part of this new contract, 
Labtech Microwave has installed and 
commissioned an autoclave at its 
Presteigne facility which will enable it to 
produce multilayer antenna elements up 
to 6 feet long.
The growing high frequency Ka-Band 
SatCom market already utilises Labtech 
Microwave’s high precision circuit 
board processing capability. These 
skills, together with the design and 
manufacturing expertise of the Milton 
Keynes site, are being employed to 
develop a Ka-Band Low Noise Amplifier 
(LNA) for the SatCom market. This 
amplifier is being sold and promoted by 
Paradise Datacom in the USA.
Looking ahead, Labtech Microwave 
will continue to grow its defence and 
air traffic control business (already 
more than 50% of sales) offset in part 
by further reductions in the telecom 
business levels leaving a modest growth 
in total sales year on year. In line with 
the changing business needs, cost 
reductions were implemented at the end 
of the year and, together with a higher 
margin product mix, it is expected that 
profitability will improve as the 2009/10 
year progresses. 
Ka-band Low Noise Amplifier, designed by Labtech Microwave for Paradise Datacom
Detector Log Video Amplifiers (DLVAs). 
Currently, Labtech Microwave is 
developing new DLVAs which operate 
at higher frequencies and have faster 
response times. DLVAs are used as part 
of an electronic surveillance system 
to detect incoming threats, requiring 
nano-second response times to trigger 
defensive solutions.
The anticipated decline in Labtech 
Microwave’s telecommunication sales 
continued during the year, although 
a focus on the higher-end radio link 
market helped stabilise the decline. Sales 
reduced 25% in 2008/09 as a leading 
European OEM completed its strategy 
of sourcing from the Far East. However, 
Labtech Microwave’s capabilities 
remain in demand for the very high-end 
products and from the smaller radio link 
suppliers who value Labtech’s more 
complete service offering including 
MMIC (Monolithic Microwave Integrated 
Circuit) packaging and assembly of the 
microwave transceivers. These high 
performance packages, utilising liquid 
16329INTELEK.indd   13 23/07/2009   13:33  Intelek 
Report and Accounts 2009
 Chief Executive’s Review continued
16329 22/07/2009 Proof 6
14
Aerostructures
CML 
Geoff Stewart Managing Director
 Sales £13.9 million (2008: £12.9 million)
Operating Profit £2.0 million (2008: £1.8 million)
CML Group manufactures machined, 
composite and sheet metal 
components and assemblies for 
aerostructures and aircraft systems 
and its customers include Airbus UK, 
APPH, BAe Systems, GE Aviation, 
GKN Aerospace, Hawker Beechcraft, 
Mecachrome, Senior Aerospace, and 
Westland Helicopters.
The Group has four divisions located 
on two sites in Birkenhead in the 
North West of England with a third 
site being planned to re-locate and 
expand the Group’s composite 
capability.
The Precision Machining Division is 
focused on 4 and 5-axis machining of 
aluminium and hard metals. Principal 
products, covering almost the full 
range of Airbus commercial and 
military aircraft, include interspar ribs 
and ancillary components, landing 
gear rib supports, sidestay fittings 
and links, underwing access panels, 
engine thrust fittings and aft mounting 
brackets etc. Components for military 
and rotary wing aircraft are also 
supplied to other customers.
The Composites Division specialises 
in the manufacture and repair of 
glass and carbon fibre components 
and assemblies. Products include 
various wing and fuselage fairings, 
covers, and panels, nose and tail 
cone assemblies, air-conditioning 
ducts, flooring etc. The division has a 
significant presence on a number of 
new-build programmes, particularly 
the F-35 Lightning II (Joint Strike 
Fighter), the Hawker 987 business 
jet and the Future Lynx helicopter 
whilst spares and other new build 
requirements are supplied for a 
variety of civil, business and military 
aircraft programmes.
The Fabrication Division’s two 
main revenue streams are from the 
manufacture of extruded fuselage 
and wing stringers for the Hawker 
987 build programme and from its 
position as a key supplier of sheet 
metal spare parts for Airbus’ in-
service fleet. 
The Treatments Division provides 
a comprehensive in-house surface 
treatments capability not only to the 
other three Divisions but also to a 
valuable external customer base.
The popular Airbus A320, CML’s  largest programme
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16329 22/07/2009 Proof 6
15
 
0
50
100
150
200
250
2010 2020 2030
JSF build  
The Joint Strike Fighter, F35, a major new programme for CML Composites Build projection for the JSF , 2010-2036 
 Sales/Head (£000)
Order Book £m (12 months)
Key Performance Indicators
(a) Marginal reduction in Sales per head following 
additional recruitment primarily in substitution 
for subcontracted services.
(b) The order book reduction comes in the wake of 
schedule reductions in corporate jet programmes.
(c) Continued strong returns on capital employed 
justifying the levels of investment.
 80
 70
 60
 50
 40
 30
 20
 10
 0
  2007 2008 2009
 12
 10
 8
 6
 4
 2
 0
  2007 2008 2009
ROCE
 50
 40
 30
 20
 10
 0
  2007 2008 2009
CML performed at record levels in 
2008/09 with an improvement in 
operating profit of 15% over the previous 
year on an increase in sales of 8%. As a 
result of the continued drive to improve 
performance and reduce waste, CML 
has increased its return on sales to 
15% (2008: 14%) delivering an excellent 
return on capital employed of 47% 
(2008: 43%).
During the last quarter of the financial 
year, we have seen a slow-down in 
order intake as a result of the global 
recession and, in particular, the business 
jet sector for which CML is a supplier 
through the Hawker Beechcraft 987 
programme. Throughout the year the 
precision machining division has seen 
levels of business for large commercial 
aircraft holding steady with forecasts 
going forward from Airbus showing build 
rates continuing at a similar level for the 
coming year. Sales for the Composites 
division were 22% up on the previous 
financial year on the back of strong 
demand from key customers Airbus, 
Hawker Beechcraft and BAe Systems. 
This included some £0.7 million of 
orders from BAe Systems on the F35 
Joint Strike Fighter programme. The 
fabrications division’s sales increased by 
30% on the previous year with the higher 
margin spares business growing by 73% 
to £0.8 million. The treatments division’s 
external sales were 10% down on the 
previous financial year as a consequence 
of the emphasis placed on supporting 
CML’s internal requirements.
16329INTELEK.indd   15 23/07/2009   13:34  Intelek 
Report and Accounts 2009
16329 22/07/2009 Proof 6
 Chief Executive’s Review continued
16
Aerostructures 
CML
Health, Safety and the 
Environment
Build rates have reduced sharply for 
corporate jets and flattened off for 
commercial jets. However, the long-
term drivers for growth are expected to 
support recovery in the years ahead. 
CML will manage its cost base in the 
face of a short-term drop in demand, 
whilst developing the spares business 
and continuing to implement our strategy 
to expand the composites division to 
support the market evolution towards the 
use of lightweight composite structures. 
During 2009 a new 60,000 square foot 
composites facility is set to be opened, 
supported by grant funding through the 
North West Development Agency.
This new facility will elevate CML’s 
position in the industry, providing 
additional capacity and capability to 
support the increase in build rates on 
packages we currently manufacture for 
the Joint Strike Fighter programme and 
to develop further opportunities on UAVs 
(Unmanned Aerial Vehicles) for which we 
took our first orders from BAe Systems 
this year. This, combined with the 
increased use of composites for the next 
generation of commercial and business 
aircraft, will put CML in a strong position 
within an aerospace industry that shows 
significant opportunities for growth in 
the long term.
The new 60,000 sq ft Composites facility, due to open towards the end of 2009
Intelek continues to invest in the training 
and development of staff at all levels and 
remains committed to the highest levels 
of husbandry of the local environment 
and care of employees. Our aim is to 
minimise waste, use valuable resources 
efficiently and prevent damage to the 
environment. Both our manufacturing 
companies which employ the use of 
chemical processes are approved to the 
international environmental standard 
ISO 14001. In addition, these two 
operating companies have been 
surveyed by the Carbon Trust and 
are implementing their energy-saving 
recommendations.
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17
Outlook
The PowerMax, the world’s highest power solid state amplifier 
At the time of writing this report, we are 
two months into our new financial year 
and continue to experience considerable 
uncertainty in our commercial market-
place although Government-funded 
programmes, which are particularly 
important to Paradise Datacom and 
Labtech Microwave, remain resilient. 
Timing of contract wins, however, can 
be somewhat difficult to predict. Our 
aerospace division, CML, will be affected 
by the well-documented issues in the 
corporate jet market. 
Our strategy of targeting Government 
sectors continues to reap rewards and 
major defence opportunities across 
the Group are increasing. We have 
implemented cost reductions throughout 
the Group in anticipation of reduced 
commercial demand, whilst preserving 
our ability to reinstate capacity once we 
signs of recovery. Based on our first two 
months of trading, we expect our first 
half to be lower than last year. However 
the release of Paradise Datacom’s new 
modem and amplifier products, together 
with the level of enquiries being fielded 
on Government programme, indicate 
that we should see an improved second 
half to the year. The Group remains well 
positioned in its key areas of satellite 
communications and we look forward to 
the future with confidence.
Ian Brodie
Chief Executive
10 June 2009
16329INTELEK.indd   17 23/07/2009   13:34  Intelek 
Report and Accounts 2009
16329 22/07/2009 Proof 6
 Financial Review
18
 Financial 
Review
Kevin Edwards
 “Underlying PBT increased by 23%. 
Underlying EPS now 3.32p up from 1.33p in 2005.”
Results
Underlying operating profit for the 
financial year to 31 March 2009 
increased by 21% to £4.6 million 
on sales up 9%, with gross margin 
increasing to 32% from 31%. After 
a £0.1 million increase in net finance 
costs, underlying profit before tax 
increased by 23% to £4.1 million, 
10.4% of sales.
Research and development costs
R&D investment at Paradise Datacom 
increased to £2.3 million, 12% of 
sales, as in the previous year. Labtech 
Microwave also increased its R&D 
investment, from £0.2 million to 
£0.4 million.
Exchange rate
Our principal subsidiary, Paradise 
Datacom LLC, reports its results in 
US dollars and these are translated at 
average exchange rates. This year the 
rate dropped 15% from $2.01 to $1.71. 
Taken together with the increased 
cost for US$ linked materials in our 
UK-based operations, the overall 
effect was a net increase in sales 
of £2.7 million and in underlying profit 
before tax of £0.5 million. The Group 
does not hedge directly against gains 
or losses on translation of the result, 
but does maintain a large portion of 
its bank debt in US dollars as a partial 
hedge against the net assets invested in 
Paradise Datacom LLC.
Finance costs
Interest costs reduced to £0.3 million 
(2008: £0.5 million) due to lower 
prevailing interest rates and lower 
average net debt. Measured against 
underlying operating profit, interest 
cover rose to 18.8 times (2008: 8.5 
times). Pension finance costs are the 
notional charges on the Group’s defined 
benefit pension scheme, representing 
the net of the expected return on 
scheme assets and interest on scheme 
obligations. This is computed by the 
scheme actuary and can fluctuate, as 
demonstrated this year by the increase 
to £0.3 million (2008: £0.1 million). The 
net cost for 2009/10 is projected by 
the actuary to increase to £0.5 million, 
primarily due to higher discount rates 
and the lower level of scheme assets.
Exceptional operating items
The Group incurred £0.4 million in 
exceptional operating items in the year. 
The main item was the restructuring 
at Labtech Microwave, with further 
changes consequent on the decline 
of its volume telecom business. This 
included £0.4 million as an impairment 
charge for assets affected by the 
change in production requirements 
and £0.1 million for personnel costs. 
Offsetting these costs was a £0.1 million 
gain associated with a pension transfer 
project initiated during the year.
Taxation
The effective tax rate on underlying 
profit increased from 29% to 31%, 
reflecting the increasing importance of 
the Group’s US operations, which bear 
a higher local tax rate than the UK’s 
28%. We expect the effective tax rate in 
2009/10 to be in the range of 32%-34%.
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19
Earnings per share
Basic EPS increased 7% to 2.97p. 
Underlying EPS increased 19% from 
2.78p to 3.32p, continuing the growth 
trend of the last five years. In the year to 
31 March 2005, the first year reported 
under IFRS, underlying EPS was 1.33p.
Pension
The fall in the equity markets during 
the period led to a sharp reduction in 
the Group’s defined benefit pension 
scheme assets to £10.2 million 
(2008: £13.9 million), as valued at 
31 March 2009 by the scheme actuary. 
Liabilities also reduced to £16.3 million 
(2008: £19.1 million), following changes 
to the discount and inflation rates and a 
review of the membership data that 
more than offset the increase for 
updated mortality assumptions. In 
addition, we made a second offer to 
members to transfer out of the scheme 
and, by the year-end, 29 members had 
accepted, reducing the liability by £0.5 
million. The net outcome was an 
increase in the deficit to £6.1 million, 
before tax (2008: £5.2 million). The 
Company has recently agreed with the 
trustees of the scheme to maintain 
the annual contribution at £0.8 million 
for the next three years, increasing 
to £0.9 million for the seven years 
thereafter, plus, in both cases, 
contributions to cover scheme 
expenses.
Cash flow
Net debt reduced by £0.1 million to 
£3.8 million. Cash generated from 
operations of £3.2 million was down 
on the previous year’s £4.1 million, 
primarily due to investment in inventory 
at Paradise Datacom to support product 
and market development. This was 
mitigated by lower tax and interest 
payments to bring net cash from 
operating activities to £2.5 million 
(2008: £2.7 million). Capital investments 
in the business, including assets 
on finance lease, were increased to 
£1.4 million (2008: £1.1 million) in 
particular to support the new sales 
and engineering offices at Paradise 
Datacom. £0.3 million was invested 
at CML (net of £0.1 million grant), 
£0.4 million at Labtech Microwave 
and £0.7 million at Paradise Datacom, 
of which £0.2 million was for third 
party R&D.
Shareholder’s equity
In addition to the net profit for the year 
of £2.5 million, £0.9 million was credited 
direct to equity for foreign exchange 
gains made on consolidating US$ 
denominated assets, £1.4 million was 
charged for net actuarial losses on the 
defined benefit pension scheme and 
£0.4 million was charged for dividends 
paid in the year.
Kevin Edwards
Finance Director
10 June 2009
 Operating proﬁ t 2005-09 by business segment (£000)
 Satellit e   Microwave circuits Aerostructures 
 C ommunications  and components
 n 2005       n 2006       n 2007       n 2008       n 2009
4.0
 3.5
3.0
2.5
2.0
1.5
1.0
0.5
0
–0.5
–1.0
Sales 2005-09 by business segment (£m)
 Satellite   Micr owave circuits Aerostructures 
 Communications  and components
 n 2005       n 2006       n 2007       n 2008       n 2009
20
16
12
8
4
0
16329INTELEK.indd   19 23/07/2009   13:34  Intelek 
Report and Accounts 2009
16329 22/07/2009 Proof 6
Directors and Senior Executives
Directors and 
Senior Executives
20
1 John Restivo
Executive Director and President of 
Paradise Datacom. Age 47.
Appointed to the Board in February 2009. 
Appointed as President of Paradise Datacom 
in April 2004, having joined in 2003 as Head of 
Business Development and Worldwide Sales. 
Over 20 years of engineering and executive 
experience in the satcoms industry, including 
Hughes, Radyne Comstream and Viasat. John 
holds a BSc in Electrical Engineering.
2 Donald Wilson
Senior Independent Non-Executive 
Director. Age 76.
Appointed to the Board in 1995. Previously 
Managing Director of Rank Xerox (UK) 
Limited, and Chairman of Rank Xerox, 
Sweden, Norway, Denmark and Ireland.
3 Kevin Edwards
Finance Director/Company Secretary. 
Age 52.
Appointed to the Board in May 2000. 
Previously Finance Director of Textron 
Fastening Systems Limited, a subsidiary of 
Textron Inc., and Finance Director of several 
subsidiaries within the GEC Group, having 
qualified as a Chartered Accountant with 
Ernst and Young.
4 David Bramwell
Non-Executive Chairman. Age 61.
Appointed to the Board in October 2004. 
Deputy Chairman of Rights and Issues 
Investment Trust plc and Chairman of several 
venture capital backed businesses. Previously 
Chief Executive of the Peterhouse Group plc 
and Managing Director of two engineering 
companies. David has a First Class Honours 
Degree in Engineering and a Doctorate in 
Business Management.
5 Geoff Stewart
Managing Director of CML. Age 57.
Appointed in 1999. Joined CML as an 
apprentice in 1968, worked in most of the 
operational divisions of the company and rose 
to Manufacturing Director in 1995. Well-known 
and respected within the UK aerospace 
industry.
6 Brian Mazonas
Managing Director of Labtech. Age 54.
Appointed in 1997. Extensive design and 
engineering management experience in 
Marconi and Plessey, primarily in microwave 
technology. In 1989, appointed General 
Manager of Elettronica UK (associate of 
Marconi), which designed and manufactured 
microwave components. This business was 
bought by Intelek in 2005. Brian holds a 
First Class BSc in Electrical and Electronic 
Engineering and a PhD in Pulsed Transferred 
Electron Oscillators.
7 Ian Brodie 
Chief Executive. Age 57.
Appointed Chief Executive of the Group in 
1999 after joining the Board as Group Finance 
Director in 1992. Held senior operational 
finance appointments within the GEC, Plessey 
and Chloride Groups. Ian is a member of the 
Institute of Chartered Accountants of Scotland 
having trained at Binder Hamlyn and obtained 
post-qualifying experience with Touche Ross 
& Co. London.
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21
Directors’ Report
 The Dir ectors present their report and the 
audited financial statements for the year 
ended 31 March 2009.
Business review 
and principal activities
The principal activities of the Group are 
the design and manufacture of electronic 
systems for satellite and microwave 
communications and the manufacture of 
precision parts for the aerospace market. 
There have not been any significant 
changes in the Company’s principal 
activities in the year under review. The 
Directors are not aware at the date of this 
report of any likely major changes in the 
Company’s activities in the next year.
This Report should be read in 
conjunction with the Chairman’s 
Statement, the Chief Executive’s Review 
and the Financial Review. In particular, 
details of the Group’s trading during the 
year and an indication of likely future 
developments are contained in the Chief 
Executive’s Review on pages 6 to 19.
Results and dividends
The results for the year are set out 
on page 33. The profit on continuing 
ordinary activities before taxation 
amounts to £3,663,000 (2008: 
£3,309,000). An interim dividend of 
0.165p (2008: 0.15p) per Ordinary Share 
was paid on 21 January 2009. A final 
dividend of 0.30p (2008: 0.30p) per 
share is recommended for approval 
at the Annual General Meeting on 11 
September 2009. It is proposed that this 
should be paid on 23 September 2009 to 
shareholders on the register at the close 
of business on 28 August 2009.
Research and development activities
The Group continued to invest in new 
product development, primarily in 
satellite communications and microwave 
components.
Key performance indicators
Key performance indicators are set 
out and explained for each business 
segment in the Chief Executive’s Review.
Principal risks and 
uncertainties facing the Group
The Annual Report contains certain 
forward-looking statements. These 
statements are made by the Directors 
in good faith, based on the information 
available to them up to the time of 
approval of this report. Actual results 
may differ from those expressed in such 
statements, depending on a variety of 
factors. These factors include customer 
acceptance of the Group’s products; 
changes in customer requirements 
and in levels of demand in the 
market; restrictions to market access; 
competitive pressure on pricing, delivery 
or technology; global defence spending 
levels; delays or additional cost in 
product design and launch programmes; 
fluctuations in manufacturing delivery 
performance, yields and costs; the 
loss or lack of key personnel; overall 
economic conditions.
The world is currently experiencing 
unprecedented economic events and this 
is affecting everyone to a varying degree 
and we will not be immune. 
The Group mitigates against these risks 
by the diversity of its product range and 
markets and its sizeable investment in 
products, skills and market development. 
The Group’s senior management visit 
each business regularly and monitor the 
forward performance and prospects.
As part of the Group’s risk management 
process, each business assesses the 
likelihood and potential adverse impact 
of these various risks and prepares 
action programmes prioritised to mitigate 
the overall impact. This is explained in 
more detail in the Corporate Governance 
Report on pages 26 to 28.
Financial instruments
The Group’s operations expose it to a 
variety of financial risks including the 
effects of changes in interest rates on 
debt, foreign currency exchange rates, 
credit risk and liquidity risk. 
The Group’s principal financial 
instruments comprise cash and bank 
deposits, bank loans and overdrafts 
and obligations under finance leases 
together with trade receivables and 
trade payables that arise directly from 
its operations.
The main risks arising from the 
Company’s financial instruments can be 
analysed as follows:
Price risk
The Group has no significant exposure 
to securities price risk, except indirectly 
through its responsibility for the Group 
Defined Benefit Pension Scheme.
Foreign currency risk
The Group is exposed in its trading 
operations to the risk of changes in 
foreign currency exchange rates. 
The main foreign currencies in which 
the Group operates are the euro 
and the US dollar. The Group has 
used derivative instruments in its 
management of this risk.
The Group holds US$825,000 forward 
foreign currency contracts at 31 March 
2009. Further description is given in 
note 32 of these financial statements in 
respect of the accounting treatment of 
these derivative instruments.
Credit risk
The Group’s principal financial assets 
are bank balances, cash, and trade 
receivables, which represent the Group’s 
maximum exposure to credit risk in 
relation to financial assets.
Credit risk is managed by monitoring 
the aggregate amount and duration 
of exposure to any one customer 
depending upon their credit rating. The 
amounts presented in the balance sheet 
are net of allowances for doubtful debts, 
estimated by the Group’s management 
based on prior experience and their 
assessment of the current economic 
environment.
The Group has no significant 
concentration of credit risk, with 
exposure spread over a large number of 
customers.
The credit risk on liquid funds is limited 
because the counterparties are banks 
with high credit ratings assigned by 
international credit-rating agencies.
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22
 Directors’ Report continued
Liquidity risk 
The Group’s policy has been to ensure 
continuity of funding through acquiring 
an element of the Group’s fixed assets 
under finance leases, and arranging 
funding for operations via medium-term 
loans and additional revolving credit 
facilities to aid short-term flexibility.
 Cash flow interest rate risk
Interest bearing assets comprise cash 
and bank deposits, all of which earn 
interest at a market rate. The interest 
rate on bank borrowings is at market 
rate and the Group’s policy is to keep 
the bank borrowings within defined limits 
such that the risk that could arise from a 
significant change in interest rates would 
not have a material impact on cash 
flows. The Group’s policy is to maintain 
other borrowings at fixed rates to fix the 
amount of future interest cash flows. 
The Directors monitor the overall level of 
borrowings and interest costs to limit any 
adverse effects on financial performance 
of the Group.
Environment
The Group’s policy with regard to 
the environment is to ensure that we 
understand and effectively manage 
the actual and potential environmental 
impact of our activities. Our operations 
are conducted such that we comply 
with all legal requirements relating to 
the environment in all areas where we 
carry out our business. During the period 
covered by this report the Group has not 
incurred any significant fines or penalties 
or been investigated for any significant 
breach of environmental regulations.
The principal business segments 
for which environmental matters are 
relevant in reviewing the Group are CML 
and Labtech, and comments in this 
respect are contained within the Chief 
Executive’s Review on page 16.
Capital structure
Details of the authorised and issued 
share capital, together with details of the 
movements in the Company’s issued 
share capital during the year, are shown 
in note 23. The Company has one class 
of ordinary shares, which carry no right 
to fixed income. Each share carries the 
right to one vote at general meetings of 
the Company.
There are no specific restrictions on the 
size of a holding nor on the transfer of 
shares, which are both governed by 
the general provisions of the Articles of 
Association and prevailing legislation. 
The Directors are not aware of any 
agreements between holders of the 
Company’s shares that may result in 
restrictions on the transfer of securities 
or on voting rights.
Details of employee share schemes are 
set out in note 23 and 24.
No person has any special rights over the 
Company’s share capital and all issued 
shares are fully paid.
With regard to the appointment and 
replacement of Directors and the extent 
of the powers of the Directors, the 
Company is governed by its Articles 
of Association, the Companies Acts 
and related legislation. See also the 
Corporate Governance Report on pages 
26 to 28. The power of the Directors 
to instigate the issue or buy-back of 
shares by the Company is governed 
by the Articles and the resolution of 
shareholders. The Articles may be 
amended by special resolution of the 
shareholders.
As at 10 June 2009, the Directors have 
been notified of the following interests 
amounting to 3% or more of the issued 
share capital of the Company:
Rights & Issues
Investment
Trust Plc 17,500,000 – 20.03%
N L Mills 4,676,550 –  5.35%
N Lewis 5,650,000 –  6.47%
R B Fletcher 4,650,000 –  5.32%
Framlington Investment 
Management Ltd.  4,850,000 –  5.55%
Directors
Mr J Restivo was appointed to the Board 
on 11 February 2009 and offers himself 
for re-election. The other Directors listed 
on page 20 served throughout the year. 
Mr K N Edwards retires by rotation 
and, being eligible, offers himself 
for re-election.
Directors’ shareholdings 
The interests of the Directors and their 
families in the Ordinary Shares at the 
beginning and end of the year were as 
follows:
 31 March 31 March 
 2009 2008
David Bramwell 1,500,000  1,500,000
Ian Brodie  
 Beneficial 740,470 608,513 
 Conditional 1,000,000 1,000,000
Kevin Edwards
 Beneficial 349,911 248,951 
 Conditional 750,000 750,000
John Restivo 149,115 106,437
Donald Wilson  312,878  294,296
The Conditional shares have been issued 
under the Executive LTIP scheme.
David Bramwell has further, indirect, 
beneficial interest in his capacity as 
vice-chairman of the Company’s largest 
shareholder, Rights & Issues Investment 
Trust plc.
There are no non-beneficial interests. 
There have been no changes in the 
above Directors’ interests in the period 
to 10 June 2009. 
The Directors’ options to subscribe for 
shares under the Executive and other 
share option schemes are set out in the 
Remuneration Report on pages 29 to 31.
Payment of creditors
The Group’s policy for the year ending 
31 March 2010, for all suppliers, is to 
fix terms of payment for each business 
transaction, to ensure that the supplier 
is aware of those terms, and to abide 
by the agreed terms of payment. The 
Company had no trade creditors.
Donations
The Group did not make any political 
or charitable donations in the year 
(2008: £Nil).
Employee involvement
During the year the Group has 
continued its policy of full involvement 
of employees wherever possible. This 
has taken place through the provision 
of information, consultation on policy 
issues where appropriate, and the 
mutual setting of objectives against 
which performance is measured. The 
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Group takes the approach of maximising 
performance through the heightening of 
awareness of corporate objectives and 
policies.
Disabled persons
It is the Group’s policy to offer equal 
opportunities to disabled persons 
applying for vacancies, having regard 
to their abilities in relation to the job 
for which they apply. It is also Group 
practice, wherever possible, to continue 
the employment of any employees who 
become disabled during the course of 
their employment.
Special business
A resolution will be proposed at the 
Annual General Meeting to renew the 
existing authority of the Directors, 
conferred by a resolution passed in 
September 2008, to allot unissued 
shares in the Company. The authority 
(resolution 7 in the Notice of Meeting) 
will extend until the earlier of the Annual 
General Meeting for 2010 and fifteen 
months from the date of the Annual 
General Meeting for 2009.
The Company was authorised at the 
Annual General Meeting in September 
2008 to purchase up to 10% of its 
issued Ordinary Shares, subject to 
certain restrictions. This authority has 
not yet been exercised, but the Directors 
consider that purchases by the Company 
of its Ordinary Shares for cancellation 
could in certain circumstances be 
advantageous to Shareholders, and are 
accordingly seeking the renewal of the 
authority (resolution 8 in the Notice of 
Meeting) to extend until the earlier of 
the Annual General Meeting for 2010 
and fifteen months from the date of 
the Annual General Meeting for 2009. 
This authority will only be exercised if 
to do so would result in an increase in 
earnings per share. Under the proposed 
authority, the maximum price payable 
for the purchase of shares shall not 
exceed 5% above the average of the 
middle market quotations taken from The 
London Stock Exchange Official List for 
the five business days before a purchase 
is made, and the minimum price shall be 
5p per share.
In addition, the Directors consider it 
advisable that they continue to have 
power to make allotments of Ordinary 
Shares in the Company for cash, up to a 
maximum of 4,368,804 Ordinary Shares, 
being 5% of the issued Ordinary Share 
Capital of the Company at 31 March 
2009. The authority (resolution 9 in the 
Notice of Meeting) will extend until the 
earlier of the Annual General Meeting for 
2010 and fifteen months from the date of 
the Annual General Meeting for 2009.
Going Concern
After making enquiries, the Directors 
have decided at the time of approving 
the financial statements that there 
is a reasonable expectation that the 
Company and the Group have adequate 
resources to continue in operational 
existence for the foreseeable future. 
The current economic conditions create 
uncertainty for all businesses. The 
Group’s trading and cash flow forecasts 
take into account a range of possible 
changes in trading performance and 
show that the Group should be able to 
operate within its existing cash resources 
and bank facilities. The Group has held 
discussions with its bankers about its 
future requirements and no matters have 
been drawn to its attention to suggest 
renewal may not be forthcoming on 
acceptable terms. For this reason, 
the Directors continue to prepare 
the financial statements on a going 
concern basis.
Auditor
So far as the Directors are aware, there 
is no relevant information needed by 
the Company’s auditor in connection 
with preparing their report of which 
the Company’s auditor is unaware. A 
resolution to reappoint Grant Thornton 
UK LLP as auditor will be proposed at 
the forthcoming AGM.
Approval
The Report of the Directors was 
approved by the Board on 10 June 2009 
and signed on its behalf by:
K N Edwards
Director and Secretary
10 June 2009
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Statement of Directors’ Responsibilities
 The Directors are responsible for 
preparing the Annual Report and the 
Financial Statements of the Group and 
the Parent Company in accordance with 
applicable law and regulations. 
Company law requires the Directors 
to prepare statements for each 
financial year.
The Directors have elected to prepare 
the Group financial statements in 
accordance with International Financial 
Reporting Standards as adopted by 
the EU and to prepare the financial 
statements for the Parent Company 
in accordance with United Kingdom 
Generally Accepted Accounting Practice. 
The financial statements are required 
by law to give a true and fair view of the 
state of affairs of the Group and of the 
Parent Company and of the profit or 
loss of the Group for that period.
In preparing each of the Group and 
Parent Company financial statements, 
the Directors are required to:
n select suitable accounting policies 
and then apply them consistently;
n make judgements and estimates that 
are reasonable and prudent; and
n for the Group financial statements, 
state whether they have been 
prepared in accordance with IFRS as 
adopted by the EU. 
n for the Parent Company financial 
statements, state whether they have 
been prepared in accordance with 
United Kingdom Generally Accepted 
Accounting Practice. 
The Directors are responsible for 
ensuring that the Parent Company and 
the Group maintain proper accounting 
records which disclose with reasonable 
accuracy at any time the financial 
position of the Parent Company and the 
Group and enable them to ensure that 
the financial statements comply with 
the Companies Act 1985. They are also 
responsible for safeguarding the assets 
of the Parent Company and the Group 
and hence for taking reasonable steps 
for the prevention and detection of fraud 
and other irregularities.
On behalf of the Board 
K N Edwards
Director and Secretary
10 June 2009
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Corporate Governance Report
 Combined Code
As a company listed on the Alternative 
Investment Market of the London Stock 
Exchange, Intelek plc is not required to 
comply with the Combined Code (‘the 
Code’). However, the Directors have 
adopted the Code as best practice and 
seek to comply to the extent practicable 
for the size of the Company and its 
operations. A statement on how the 
Company has applied the principles 
and a statement explaining the extent 
to which it has complied with the 
provisions of the Code appear below. 
The Code contains fourteen principles of 
governance, which are divided into the 
following six areas:
1. Directors
The Company is controlled through 
a Board of Directors, which presently 
comprises three executive and two 
non-executive Directors. David Bramwell 
is non-executive Chairman, Ian Brodie 
is Chief Executive, Kevin Edwards is 
Finance Director and John Restivo is 
President of the Company’s subsidiary 
Paradise Datacom LLC. Donald Wilson 
is the Senior Independent non-executive 
Director. All Directors will submit 
themselves for re-election at least every 
three years. Appointments to the Board 
are made on the recommendation of the 
Nomination Committee.
The Board has a formal schedule of 
matters reserved to it and meets at least 
eleven times a year. It is responsible 
for overall Group strategy, policy 
on corporate governance issues, 
acquisition policy, approval of major 
capital expenditure and consideration 
of significant financial and operational 
matters. It monitors the exposure to key 
business risks and reviews the strategic 
direction of the trading subsidiaries, their 
annual budgets and progress towards 
the achievement of those budgets and 
their investment programmes. It also 
considers legislative, environmental, 
health and safety and employment 
issues. The Board has approved a 
written statement of the division of key 
responsibilities between the Chairman 
and the Chief Executive.
The Chairman leads the Board, ensuring 
that each Director is able to make an 
effective contribution. He also monitors 
the information provided to the Board to 
ensure it is sufficient, timely and clear, 
and from time to time the Board reviews 
the adequacy of this information.
The Board held twelve meetings during 
2008/09, other than those required for 
specific approvals (for example, bank 
mandates and annual accounts). The 
attendances were:
David Bramwell 12
Ian Brodie 12
Kevin Edwards 12
John Restivo (since appointment) 2
Donald Wilson 12
Two of the meetings were combined with 
visits to subsidiary Company operations 
and one included presentations by senior 
executives on their areas of responsibility. 
Individual visits to operational sites by 
non-executive Directors also occurred. In 
addition to the regular Board meetings, 
key financial information is circulated to 
Directors outside of meetings. The Chief 
Executive has regular direct contact with 
the non-executive Directors and keeps 
them informed of material developments 
between Board meetings.
All Directors have direct access to the 
Company Secretary and are able to take 
independent professional advice in the 
furtherance of their duties if necessary. 
The Company maintains Directors’ & 
Officers’ insurance in respect of the risk 
of claims against Directors.
The Chairman held two meetings during 
the year with the non-executive Director, 
without the executive Directors being 
present. The Senior Independent Director 
held one meeting during the year with 
the other Directors, without the Chairman 
being present, to review the Chairman’s 
performance, as described in more detail 
below.
The Board has adopted an induction 
process for new Directors and this is 
facilitated by the Chief Executive and 
the Company Secretary. The Chairman 
ensures that all Directors receive 
appropriate training on appointment and 
then subsequently as needed, taking into 
account their need to update their skills 
and their knowledge of the Company’s 
business. 
The Board has established three 
standing committees, the Audit 
Committee, the Remuneration 
Committee and the Nomination 
Committee, which operate within defined 
terms of reference. Details may be 
obtained from the Company Secretary. 
The minutes of committee meetings are 
available to all the Directors. During the 
year, the Remuneration Committee met 
twice, the Audit Committee twice and 
the Nomination Committee once. All 
committee meetings were attended by 
all members of the relevant committee. 
The Board undertakes an annual 
evaluation of its performance and the 
performance of its committees and the 
individual Directors. This comprises:
n Appraisal of the other executive 
Directors by the Chief Executive
n Appraisal of the Chief Executive by 
the Senior Independent non-executive 
Director
n Appraisal of the Chairman and the 
other non-executive Directors and of 
the Board as a whole collectively by 
the Board
The appraisals focused on performance 
against objectives set for the past year, 
on establishing objectives for the new 
financial year and, for the Board, on its 
operation and effectiveness. The Board 
was satisfied that the process showed 
that the Board and its committees 
worked effectively. 
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Corporate Governance Report continued
2. Directors’ remuneration
The Remuneration Committee consists 
of the Chairman and the Senior 
Independent non-executive Director 
and meets at least twice a year. Its 
responsibilities include a review of the 
performance of executive Directors 
and other senior executives prior to 
determining their remuneration. The 
remuneration of the non-executive 
Directors is determined by the Board of 
Directors as a whole. No Director plays 
a part in the discussion about his own 
remuneration. 
The Remuneration Report is set out on 
pages 29 to 31. 
3. Nomination committee
The principal role of the Nomination 
Committee is to identify and nominate, 
for Board approval, candidates to fill 
Board vacancies as and when they arise. 
It is required to prepare a description of 
the role, and capabilities required, for any 
appointment, and to maintain contact 
with major shareholders about 
appointments to the Board. It also 
reviews the induction process for newly 
appointed Directors, reviews annually the 
time required of non-executive Directors, 
keeps the structure, size and composition 
of the Board under review, and considers 
Board succession planning for both 
executive and non-executive Directors. 
The committee comprises Donald Wilson 
(Chairman), David Bramwell, both 
considered to be Independent 
non-executive Directors, and 
Ian Brodie, Chief Executive. 
For Board appointments the committee 
seeks advice and recommendations from 
the Group’s lawyers, corporate finance 
advisers and auditors.
During the year, the committee reviewed 
the balance of experience on the Board 
and recommended to the Board that 
John Restivo be appointed to the Board.
The Chairman of the Nominations 
Committee will be available at the Annual 
General Meeting to answer any questions 
about the work of the committee.
4. Accountability and audit 
A review of the performance of the 
Group’s trading subsidiaries, of the 
financial position of the Group and of 
the Group’s prospects is included in 
the Chairman’s statement, the Chief 
Executive’s review and the Financial 
Review set out on pages 4 to 19. The 
Directors’ responsibilities for the financial 
statements are described on page 24. 
Internal Control
The Board of Directors is responsible for 
the Group’s system of internal control 
and for reviewing its effectiveness. In 
designing the system of internal control, 
consideration is given to the significant 
risks to the business, the probability 
of these risks manifesting themselves 
and the overall cost of controlling them. 
The system is designed to manage 
rather than eliminate the risk of failing 
to achieve business objectives and, 
therefore, can only provide reasonable, 
and not absolute, assurance against 
material misstatement or loss.
The implementation and day-to-day 
operation of the system of internal 
controls has been delegated to executive 
Directors and senior management, 
but the effectiveness of the system 
is regularly reviewed by the Board 
in a process that accords with the 
Turnbull Report. As part of its corporate 
governance procedures, the Board has 
received regular reports on specific 
areas of risk. If appropriate, these 
reports include recommendations for 
improvement in controls or for the 
management of those risks. Furthermore, 
steps continue to be taken to integrate 
risk management procedures into the 
Group’s operations, to extend awareness 
of the importance of the management 
of risk and to ensure that recommended 
improvements brought to the attention 
of the Board are implemented. In 
conjunction with the Audit Committee, 
the Board has carried out an annual 
review of the overall effectiveness of 
the system of internal control and risk 
management procedures during the year 
and up until the date of approval of the 
annual report.
Audit committee and auditors
Role of the audit committee
The Audit Committee is responsible for:
n Monitoring the integrity of the financial 
statements of the Group and any 
formal announcements relating to 
the Group’s financial performance, 
and reviewing significant financial 
reporting judgements contained 
therein;
n Reviewing the Group’s internal 
financial controls and, unless 
expressly addressed by the Board 
itself, the Group’s internal control and 
risk management systems;
n Monitoring and reviewing the 
effectiveness of the Group’s internal 
audit operation;
n Making recommendations to the 
Board, for a resolution to be put to 
the shareholders for their approval 
in general meeting, in relation to the 
appointment of the external auditors 
and the approval of the remuneration 
and terms of engagement of the 
external auditors;
n Reviewing and monitoring the 
external auditors’ independence 
and objectivity and the effectiveness 
of the audit process, taking into 
consideration relevant UK professional 
and regulatory requirements; 
n Developing and implementing a policy 
on the engagement of the external 
auditors to supply non-audit services, 
taking into account relevant guidance 
regarding the provision of non-audit 
services by the external audit firm.
The Audit Committee is required to report 
its findings to the Board, identifying any 
matters in respect of which it considers 
that action or improvement is needed, 
and make recommendations as to the 
steps to be taken.
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Composition of the audit committee
The Audit Committee comprises David 
Bramwell (Chairman) and Donald Wilson, 
both of whom served throughout the 
year. Both members of the committee 
are considered to be independent. 
David Bramwell has relevant financial 
experience.
Meetings and attendance
The committee met twice during 2008/09 
to consider, inter alia, the annual results, 
the interim results and the independence, 
objectivity and reappointment of the 
Auditors. Internal financial control 
systems were also considered at each 
meeting. The Chairman of the committee 
also invited the Chief Executive and the 
Finance Director to attend each meeting 
and the internal auditor and external 
auditors to attend the meeting for the 
year’s results. During the latter meeting, 
the external auditors were given the 
opportunity to talk with the committee 
without the presence of management.
Main activities of the
committee during the year
At its meeting in May, the committee 
reviewed the annual financial statements 
of the Company and received reports 
from the internal auditors on control 
matters and from the external auditors on 
the conduct of their audit, their review of 
accounting policies, areas of judgement 
and the financial statements and their 
comments on risk and internal control. 
A similar review was undertaken at its 
November meeting when the interim 
statements were considered.
External auditors
The Company places great importance 
on the effectiveness and independence 
of its external auditors and, together with 
them, is careful to ensure their objectivity 
is not compromised. At its May meeting, 
the auditors presented to the committee 
the findings from their audit, together 
with details of how they ensure that 
their objectivity and independence are 
not compromised.
It is the role of the committee to ensure 
compliance with the Board’s policy in 
respect of services provided by, and 
fees paid to, the auditors. Audit fees are 
negotiated by the Finance Director and 
approved by the Audit Committee. For 
other services that may be provided by 
the auditors, the Company’s policy is:
Audit related services
The auditors are invited by the Company 
to undertake those services that they 
are required to and are most suited to 
perform. Such work would include AIM 
related reporting and, where appropriate, 
assistance with acquisitions.
Taxation
The external auditors assist the Group 
to meet general tax compliance 
requirements as well as providing 
advice on acquisitions and tax planning. 
Should opportunities arise for them 
to advise on special tax projects, their 
suitability is assessed at the time to 
ensure it would not compromise their 
audit independence, with the work being 
tendered where appropriate.
Consulting
To avoid any possible conflict of interest 
the Group’s policy is not to employ its 
auditors for general consulting work.
Following its May 2009 meeting, the 
committee recommended to the Board 
that a resolution be put to shareholders 
at the Annual General Meeting for the 
reappointment of the external auditors, 
and to authorise the Directors to fix their 
remuneration.
Internal audit
The internal audit work is contracted-out 
to Norris Small, Chartered Accountants. 
The firm has no association with the 
external auditors. As well as its reviews 
of the internal auditor’s role and 
processes, during its meeting in 2008/09, 
the committee received presentations 
from the internal auditor, the results of 
work undertaken by him and his plan for 
work in 2009. The committee considered 
the need for an internal audit function 
and decided that, in view of the size of 
the Group, a full-time resource could not 
be justified and that the service should 
continue to be contracted-out.
Overview
As a result of its work during the year, 
the Audit Committee has concluded 
that it has acted in accordance with its 
terms of reference and has ensured the 
independence and objectivity of the 
external auditors.
The Chairman of the Audit Committee 
will be available at the Annual General 
Meeting to answer any questions about 
the work of the committee.
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Corporate Governance Report continued
5. Relations with shareholders
The Company encourages two-way 
communication with both its institutional 
and private investors and responds 
promptly to all enquiries received 
orally or in writing. During the year 
the Chairman, Chief Executive and 
the Finance Director, either separately 
or together, attended a number of 
meetings with analysts, and with major 
shareholders. Written reports about the 
Company by analysts or brokers are 
circulated to all Directors.
Broker research notes, annual and 
interim reports and presentations are 
made available electronically on the 
Company’s website.
All shareholders receive at least 
twenty working days’ notice of the 
Annual General Meeting at which all 
Directors are available for questions. 
Each substantive issue is the subject 
of a separate resolution. The numbers 
of proxy votes for and against each 
resolution are announced at the meeting, 
after the voting has taken place.
6. Corporate governance 
compliance statement
The Company is pleased to report that it 
has complied throughout the year ended 
31 March 2009 with the provisions set 
out in Section 1 of the Code, except:
A2.2 The Chairman is a Director of 
Rights and Issues Investment Trust plc, 
a significant shareholder of Intelek plc. 
The Board is satisfied that this does 
not influence the Chairman in his role 
on the Board and considers him to be 
independent for the purposes of the 
Code.
A3.1 The Senior Independent Director, 
Donald Wilson, has been on the Board 
since his appointment on 14 July 1995. 
The Board considers that Don Wilson 
continues to provide independent and 
valuable input to the Board, bringing to 
bear his extensive experience as a senior 
executive at Rank Xerox and elsewhere.
D1.1 The Senior Independent Director 
does not attend meetings with major 
shareholders as a matter of routine. 
However, he is available should he be 
required and is present at the AGM. 
The Chairman attends the six-monthly 
announcements to shareholders and, 
with a 1.7% shareholding, and his 
beneficial interest in RIIT plc (a major 
Shareholder of the Company), has a 
close affinity with shareholders’ interests.
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Remuneration Report
 The Dir ectors present the Remuneration 
Report for the financial year ended 
31 March 2009.
As the Company is listed on AIM, it does 
not have to comply with the requirements 
of the Remuneration Report contained in 
the listing rules. However the Directors 
have decided to disclose the information 
as best practice and seek to comply to 
the extent practicable for the size of the 
Company and its operations.
Remuneration Committee
The Remuneration Committee is 
responsible for determining the 
remuneration and other terms of 
employment of the executive Directors. 
No external advisers have been used. 
In determining remuneration for the 
year, the Committee has given full 
consideration to the requirements of 
the Combined Code. 
The Remuneration Committee consists 
wholly of independent non-executive 
Directors who have no day-to-day 
involvement in the running of the 
Group’s business. The following 
independent non-executive Directors 
served as members of the Remuneration 
Committee during the year and to the 
date stated:
Donald Wilson (Chairman of the 
Remuneration Committee) 
(to 10 June 2009)
David Bramwell (to 10 June 2009)
Remuneration policy
The key objectives of the Committee in 
determining the remuneration packages 
of executive Directors for 2009 and 
subsequent years are:
1. The recruitment, retention and 
incentivisation of Executive 
management. 
2. The alignment of Executive 
management and shareholder 
interests.
The remuneration packages of executive 
Directors comprise the following 
elements:
Basic salary and benefits
Basic annual salaries for executive 
Directors are reviewed annually having 
regard to individual performance and 
market practice. Benefits provided 
to executive Directors vary but may 
comprise the provision of a Company car 
and health insurance. 
Annual bonus
The targets for annual bonus are set each 
year by the Committee. The maximum 
bonus is 100% of basic salary.
(i) Chief Executive and Finance 
Director
The bonus is paid in cash but if the 
bonus exceeds 10% of basic salary, 
the Directors are required to apply 33% 
of the net amount in the acquisition 
of the Company’s shares. The bonus 
for 2008/09 comprised three elements 
based respectively on: (a) Underlying 
Profit Before Tax at each quarter end 
during the year; (b) Net debt at the year 
end; (c) Underlying EPS for the full year.
(ii) President of Paradise Datacom
As with all divisional heads, the bonus 
is paid 25% in shares and 75% in cash. 
The bonus is based on cumulative 
quarterly Underlying Operating Profit for 
the division.
Long-Term Incentive Plan — 
Executive Scheme
(i) Share options
The Executive Share Option Scheme 
is designed to promote long-term 
improvement in the performance of 
the Company, sustained increase in 
shareholder value and clear linkage 
between Executive reward and the 
Company’s performance. The options are 
conditional upon achieving headline EPS 
growth in the aggregate of 6% above RPI 
in the 3 years prior to exercise. No further 
grants of options can be made under this 
scheme.
(ii) Share scheme — Executive LTIP
Under this scheme, shares may be 
issued to members of the executive 
from time to time, subject to compulsory 
resale of the shares to Intelek’s ESOP 
trust at a nominal price to the extent that 
performance conditions are not satisfied. 
The shares are divided into four equal 
parts, two for each measurement period, 
3 and 5 years, and, within each period, 
one for each performance criterion, 
Underlying EPS and Shareholder Return. 
The Remuneration Committee sets 
targets for EPS. Shareholder Return 
is measured against movement in the 
techmark 100 index. If less than 80% 
of the target is reached, no shares vest; 
if 80%, 25% vest; if 120%, 100% vest; 
and pro rata in between.
(iii) Divisional LTIP — Paradise 
Datacom
The scheme was set up in 2005 and runs 
to the end of 2009/10. The President 
of Paradise Datacom is entitled to a 
percentage of the increase in Computed 
Market Value for the division above a 
benchmark. The Computed Market Value 
applies assumed interest, tax rate and 
price–earnings ratio to the Underlying 
Operating Profit of the division. The Profit 
is the higher of the actual reported for the 
year to 31 March 2010 and the average 
of the five years to that date. The bonus 
is payable 25% in shares and 75% in 
cash.
Directors’ shareholdings
These are as set out in the Directors’ 
Report on page 22.
Pension contributions
The Company makes annual 
contributions to the Intelek Pension 
Schemes for the executive Directors. The 
Schemes are funded, Inland Revenue 
approved, contributory occupational 
pension schemes.
Service contracts and letters of 
appointment
The executive Directors are provided with 
service contracts, none of which exceeds 
one year.
Ian Brodie has a notice entitlement 
of one year. Kevin Edwards and John 
Restivo have a notice entitlement of six 
months. In the event of the Company 
being taken over and the Directors 
leaving the Company, the notice periods 
are as follows: Ian Brodie, two years; 
Kevin Edwards and John Restivo, one 
year. Donald Wilson and David Bramwell 
have contracts with notice entitlements 
of three months.
16329INTELEK.indd   29 23/07/2009   13:34  Intelek 
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30
 Remuneration Report continued
The Committee considers the Directors’ 
notice entitlements to be appropriate as 
they are in line with the market and take 
account of the Directors’ knowledge and 
experience.
Non-executive Directors
The fees of non-executive Directors 
are determined by the full Board to an 
amount not exceeding £200,000, as set 
out in the Articles of Association. The 
non-executive Directors are not eligible 
for bonuses or pension benefits.
Performance graph
This graph shows the Company’s 
performance for the last five years, as 
measured by the Total Shareholder 
Return (TSR) (with dividends reinvested), 
for equity shareholders of Intelek 
plc, compared with the TSR of the 
TechMARK 100 index.
This index was chosen as it represents 
a broad indication of performance in the 
sector in which the Company operates.
Directors’ emoluments
Details of the Directors’ emoluments are as follows:
 Current year Previous year
    Pension  Pension
 Salary/   contribu-  contribu-
 fees Benefits Bonus tions Total tions Total
 £000 £000 £000 £000 £000 £000 £000
Executive
Ian Brodie 174 16 75 37 302 38 328
Kevin Edwards 135 12 58 18 223 21 244
John Restivo (see note below) 3 — — — 3 — —
Non-Executive
David Bramwell 40 — — — 40 — 35
Donald Wilson  27 — — — 27 — 24
Total 379 28 133 55 595 59 631
John Restivo’s emoluments exclude his remuneration as President of Paradise Datacom. This remuneration is included in the 
disclosure of compensation for senior executives in note 8 on page 45.
Benefits comprise primarily car allowances and medical care. In addition, £45,000 has been accrued for the Executive LTIP 
(2008: £43,000). The bonus calculation is referred to on page 29 of this report.
No Director was materially interested either at the year end or during the year in any contract of significance to the Group.
 2009 2008
Directors’ pensions No. No.
The number of Directors who are accruing benefits under:
— money purchase schemes 2 2
— defined benefit schemes (further accrual terminated 1 October 2002) 1 1
Total Return Analysis 
90
100
110
120
130
140
150
2004 2005 2006 2007 2008 2009
Source: Bloomberg
Intelek FTSE Techmark 100
Return
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31
Directors’ defined benefit pension entitlement excluding additional voluntary contributions:
 Increase in accrued Transfer value of Accumulated total Accumulated total 
 annual pension increase less Directors’ accrued pension at accrued pension at
 excluding inflation contributions 31 March 2009 31 March 2008
 £000 £000 £000 £000
Ian Brodie — — 21 20
The transfer value of the Directors’ accrued benefit at the end of the financial year is shown below. (Note that the transfer value 
represents a liability of the Company, not a sum paid or due to an individual.)
Ian Brodie £000
Transfer value at 31 March 2008 310
Increase in transfer value (less Directors’ contributions) 34
Transfer value at 31 March 2009 344
Directors’ share options
Ordinary shares under the Executive Scheme, all of which are exercisable:
    Granted Exercised Expired  Option
   31 March during during during 1 April  price Expiry
 Scheme  2009 year year year  2008 £  date
Ian Brodie 2000  250,000  — — — 250,000  0.190  11.02.12
Kevin Edwards 2000  250,000  — — — 250,000  0.190  11.02.12
 2000  100,000  —  — — 100,000 0.105  07.01.13
   350,000  —  — — 350,000    
The bid price at 31 March 2009 was 13.5p. The highest bid price during the year was 17.5p and the lowest bid price during the year 
was 10.5p.
The performance criteria for annual bonuses and share options are set out on page 29 of this report.
Approval
The Directors’ Remuneration Report was approved by the Board on 10 June 2009 and signed on its behalf by:
D Wilson
Director
Chairman of the Remuneration Committee
10 June 2009
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32
Independent Auditor’s Report to the Members of Intelek plc
 W e have audited the Group and Parent 
Company financial statements of Intelek 
plc for the year ended 31 March 2009, 
which comprise the Consolidated 
Income Statement, the Consolidated 
Statement of Recognised Income and 
Expense, the Consolidated Balance 
Sheet, the Consolidated Cash Flow 
Statement and Notes 1 to 32 of the 
Group’s financial statements and the 
Company balance sheet and notes 1 
to 8 of the Parent Company financial 
statements. These financial statements 
have been prepared under the 
accounting policies set out therein.
This report is made solely to the 
Company’s shareholders, as a body, 
in accordance with Section 235 of the 
Companies Act 1985. Our audit work 
has been undertaken so that we might 
state to the Company’s shareholders 
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 
shareholders, as a body, for our audit 
work, for this report, or for the opinions 
we have formed.
Respective responsibilities of 
Directors and auditor
The Directors’ responsibilities for 
preparing the Annual Report and 
the Group financial statements in 
accordance with applicable UK law and 
the International Financial Reporting 
Standards (IFRS) as adopted by the 
European Union, and for preparing the 
Parent Company financial statements in 
accordance with United Kingdom law 
and Accounting Standards (UK Generally 
Accepted Accounting Practice) are 
set out in the Statement of Directors’ 
Responsibilities.
Our responsibility is to audit the Group 
financial statements in accordance 
with relevant legal and regulatory 
requirements and International Standards 
on Auditing (UK and Ireland).
We report to you in our opinion as 
to whether the financial statements 
give a true and fair view and whether 
the financial statements have been 
properly prepared in accordance with 
the Companies Act 1985. We also report 
to you if the information given in the 
Directors’ Report is inconsistent with the 
financial statements. The information 
given in the Directors’ Report includes 
that specific information presented in 
the Chairman’s Statement, the Chief 
Executive’s Review and the Financial 
Review that is cross-referenced from the 
Business review and principal activities 
section of the Directors’ Report.
In addition, we report to you if, in our 
opinion, the Company has not kept 
proper accounting records, if we have 
not received all the information and 
explanations we require for our audit, or 
if information specified by law regarding 
Directors’ remuneration and other 
transactions is not disclosed.
We read other information contained 
in the Annual Report and consider 
whether it is consistent with the audited 
Group financial statements. The other 
information comprises the Group 
Overview, the Chairman’s Statement, the 
Chief Executive Review, the Financial 
Review, the Directors and Senior Officers, 
the Corporate Governance Report, the 
Remuneration Report, the Director’s 
Report and the Statement of Directors’ 
Responsibilities. We consider the 
implications for our report if we become 
aware of any apparent misstatements or 
material inconsistencies with the Group 
financial statements. Our responsibilities 
do not extend to any information outside 
the Annual Report. 
Basis of audit opinion 
We conducted our audit in accordance 
with International Standards on Auditing 
(UK and Ireland) issued by the Auditing 
Practices Board. An audit includes the 
examination, on a test basis, of evidence 
relevant to the amounts and disclosures 
in the Group financial statements. It also 
includes an assessment of the significant 
estimates and judgements made by 
the Directors in the preparation of the 
financial statements, and of whether 
the accounting policies are appropriate 
to the Group’s and Company’s 
circumstances, consistently applied 
and adequately disclosed.
We planned and performed our audit 
so as to obtain all the information and 
explanations which we considered 
necessary in order to provide us with 
sufficient evidence to give reasonable 
assurance that the Group financial 
statements are free from material 
misstatement, whether caused by fraud 
or other irregularity or error. In forming 
our opinion we also evaluated the 
overall adequacy of the presentation 
of information in the Group financial 
statements.
Opinion
In our opinion:
n The Group financial statements give a 
true and fair view in accordance with 
IFRS’s as adopted by the European 
Union, of the state of affairs of the 
Group as at 31 March 2009 and of its 
profit for the year then ended.
n The Group financial statements have 
been properly prepared in accordance 
with the Companies Act 1985.
n The Parent Company financial 
statements give a true and fair 
view in accordance with United 
Kingdom Generally Accepted 
Accounting Practice, of the state 
of the Company’s affairs as at 
31 March 2009.
n The Parent Company’s financial 
statements have been properly 
prepared in accordance with the 
Companies Act 1985.
n The information given in the 
Directors’ Report is consistent with 
the financial statements.
Grant Thornton UK LLP
Chartered Accountants 
and Registered Auditor
Birmingham
10 June 2009
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 www.intelek.plc.uk 33
Consolidated Income Statement
for the year ended 31 March 2009
   2009 2008
 Note £000 £000
Continuing Operations
Sales 3 39,276  35,962 
Cost of goods sold  (26,698) (24,861)
Gross profit  12,578  11,101 
Selling and administrative expenses before exceptional items  (5,280) (5,305)
Exceptional operating items 7 (417) —
Selling and administrative expenses  (5,697) (5,305)
Research and development expenses  (2,667) (1,978)
Underlying operating profit 3 4,631  3,818 
Exceptional operating items 7 (417) —
Operating profit  4,214  3,818 
Interest receivable 4 12  27 
Interest payable 4 (258) (477)
Expected return on pension scheme assets 5 898  1,042 
Interest on pension scheme obligations 5 (1,203) (1,101)
Finance costs — net  (551) (509)
Underlying profit before tax 3 4,080  3,309 
Exceptional operating items 7 (417) —
Profit before tax from continuing operations  3,663  3,309 
Taxation 9 (1,138) (953)
Profit for the year attributable to equity shareholders  2,525  2,356 
Earnings per share — basic 10 2.97p 2.78p
Earnings per share — diluted 10 2.96p 2.77p
Consolidated Statement of Recognised Income and Expense
for the year ended 31 March 2009
  2009 2008
 Note £000 £000
Foreign exchange translation differences  1,782  (35)
Net (loss)/gain on hedge of net investment in foreign subsidiary  (889) 24 
Actuarial gains and losses on defined benefit pension plan 5 (1,907) (873)
Deferred tax on actuarial gains and losses 5 534  244
Income and expense recognised directly in equity  (480) (640)
Profit for the year  2,525  2,356 
Total recognised income and expense for the year 
attributable to equity shareholders of the Parent Company  2,045  1,716
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34
Consolidated Balance Sheet
 as at 31 March 2009
   2009 2008
 Note £000 £000
ASSETS   
Goodwill 12 14,025  13,366 
Intangible assets 13 486  383 
Property, plant and equipment 14 5,911  5,864 
Deferred tax assets arising on pension obligation 5,19 1,698  1,459 
Other deferred tax assets 19 836  817 
Total non-current assets  22,956  21,889 
Inventories 15 6,104  3,706 
Trade and other receivables 16 7,493  6,292
Current tax assets 17 — 112 
Cash and cash equivalents 18 1,013  1,245 
Total current assets  14,610  11,355 
Total assets  37,566  33,244 
LIABILITIES   
Defined benefit pension obligation 5 (6,063) (5,212)
Borrowings 31 (2,987) (2,994)
Deferred tax liabilities 19 (974) (450)
Deferred government grants 20 (200) (78)
Total non-current liabilities  (10,224) (8,734)
Borrowings 31 (1,811) (2,115)
Trade and other payables 21 (7,688) (6,381)
Current tax liabilities 17 (47) —
Provisions and other liabilities 22 (179) (50)
Total current liabilities  (9,725) (8,546)
Total liabilities  (19,949) (17,280)
Net assets attributable to equity shareholders 3 17,617  15,964 
SHAREHOLDERS’ EQUITY  
Issued capital 23 4,369  4,369 
Own shares 25,26 (418) (429)
Other reserves 25 3,411  3,411 
Distributable reserves 25 10,255  8,613 
Total equity 25 17,617  15,964
 
Approved by the Board of Directors and signed on their behalf on 10 June 2009 by:
I D Brodie K N Edwards
Director Director
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16329 22/07/2009 Proof 6
 Consolidated Cash Flow Statement
  for t he year ended 31 March 2009
   2009 2008
 Note £000 £000
Cash flows from operating activities   
Cash generated from operations 27 3,160  4,101 
Interest paid  (258) (477)
Interest received  12  27 
Tax paid  (397) (985)
Net cash from operating activities  2,517  2,666 
Cash flows from investing activities
Proceeds from sale of property, plant and equipment  34  15 
Purchases of property, plant, equipment and intangible assets  (1,224) (604)
Capital grants received  129 —
Net cash from investing activities  (1,061) (589)
Cash flows from financing activities
Share issues  12  60 
Increase in bank loans  123  144 
Finance lease payments  (704) (769)
Dividends paid 11 (403) (355)
Net cash from financing activities  (972) (920)
Net increase in cash and cash equivalents  484  1,157 
Cash and cash equivalents at 1 April  192  (963)
Effect of foreign exchange rates  (619) (2)
Cash and cash equivalents at 31 March 28 57  192 
 www.intelek.plc.uk 35
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36
 Notes to the Financial Statements continued
for the year ended 31 March 2009
 1. Significant Accounting Policies
(a) Basis of preparation
 These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted 
for use in the European Union and with the Companies Act 1985. The Group financial statements have been prepared under the 
historical cost convention with the exception of derivative financial instruments which are measured at fair value. The policies 
have been consistently applied for all years presented. The following accounting standards have been issued in the period but 
were not yet effective and are not expected to have a significant impact on the Group. Unless stated they all become effective for 
the year ending March 2010.
n IAS 1 (Revised 2007) — “Presentation of Financial Statements”: This will require the Group to alter the format of its primary 
statements.
n IFRS 3 (Revised 2008) — “Business combinations” (first effective year ended March 2011)
n IFRS 8 “Segmental Reporting” — This will require additional disclosure, although not significantly different to the current 
disclosure provided in accordance with IAS 14.
n  IAS 27 (Revised 2008) — “Consolidated and Separate Financial Statements”
n IAS 23 (Amendment) — “Borrowing costs”
n IAS 32 (Amended) — “Financial instruments” 
n IFRIC 16 — “Hedges of a net investment in a foreign operation” 
(b) Basis of consolidation
Subsidiaries are entities controlled by the Company. Control exists when the Company has the power, directly or indirectly, to 
govern the financial and operating policies of an entity so as to obtain benefits from its activities. The financial statements of all 
of the Group’s subsidiaries are included in the consolidated financial statements from the date that control commences until the 
date that control ceases.
The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the 
effective date of acquisition or up to the effective date of disposal. 
Unrealised gains on transactions between the Group and its subsidiaries are eliminated. Unrealised losses are also eliminated 
unless the transaction provides evidence of an impairment of the assets transferred. Amounts reported in the financial statements 
have been adjusted where necessary to ensure consistency with the accounting policies adopted by the Group.
(c) Business combinations
The acquisition of subsidiaries is accounted for using the purchase method. The cost of the acquisition is measured as the 
aggregate of the fair values, at the date of exchange, of the assets given, liabilities incurred or assumed, and equity instruments 
issued by the Group in exchange for control of the acquiree, plus any costs directly attributable to the business combination. 
The assets, liabilities and contingent liabilities that meet the conditions under IFRS 3 are recognised at their fair values at the 
acquisition date. All subsidiaries are accounted for using accounting policies in line with those of the Group.
Goodwill arising on acquisition is recognised as an asset, being the excess of the cost of the business combination over the net 
fair value of the assets being acquired. 
(d) Foreign currency
 The i ndividual financial statements for each company are presented in the currency of the primary economic environment in 
which it operates (its functional currency). For the purposes of the consolidated and presentational financial statements, the 
results and financial position of the Group are expressed in pounds sterling, which is the functional and presentational currency 
of the Group. 
 In preparing the financial statements of the individual companies, transactions in currencies other than the entity’s functional 
currency are translated at the foreign exchange rate ruling at the date of transaction. Monetary assets and liabilities in foreign 
currencies are translated at the exchange rates ruling at the balance sheet date. Foreign exchange differences arising are 
recognised in the income statement.
The results and cash flows of overseas subsidiaries are translated to sterling at rates that approximates to exchange rates at 
the dates of the transactions. The assets and liabilities are translated at exchange rates ruling at the balance sheet date. Foreign 
exchange differences arising are classified as equity and transferred to the Group’s translation reserve. Translation reserves are 
recognised as income or as expense in the period in which the related overseas subsidiary is disposed of.
 In order to hedge its exposure to certain foreign currency exchange risks, the Group uses derivative financial instruments 
(forward contracts) to hedge significant exposure on foreign exchange transactions. This is explained in the Financial instruments 
accounting policy and note 32 of these financial statements. The Group does not hedge account for forward foreign currency 
contracts. 
Exchange rate differences arising on foreign currency borrowings to the extent that they are hedged on the Group’s investment  
in its overseas operations are reported in the Statement of Total Recognised Income and Expense and as movement through 
Profit and Loss Reserves.
(e) Financial instruments
Financial assets and liabilities are recognised on the Group’s balance sheet when the Group becomes a party to the contractual 
provisions of the instrument.
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37
1. Significant Accounting Policies continued
 Financial assets
The Company’s financial assets comprise trade and other receivables and cash and cash equivalents and are classified as loans 
and receivables. They are initially recognised at fair value less transaction costs, and measured subsequently at amortised cost 
using the effective interest method, less provision for any impairment. Any change in their value through impairment or reversal 
of impairment is recognised in the Income Statement. Interest and other cash flows resulting from holding financial assets are 
recognised in the Income Statement when received, regardless of how the related carrying amount of financial asset is measured.
 No financial assets are classified as fair value through profit and loss or as held to maturity or available for sale. 
Impairment of financial assets
All financial assets are assessed for indicators of impairment at each balance sheet date. Financial assets are impaired where 
there is evidence that a loss event has occurred and that estimated future cash flows of the financial asset have been impacted.
For certain categories of financial asset, such as trade receivables, assets are assessed for impairment on a collective basis. 
Objective evidence of impairment for a portfolio of receivables could include the Group’s past experience of collecting payments, 
an increase in the number of delayed payments in the portfolio and the average credit period, as well as observed changes in 
national or local economic conditions that correlate with default on receivables. 
 Cash and cash equivalents
For the cash flow statement, cash and cash equivalents comprise cash at bank and deposits and bank overdrafts. For the 
balance sheet, bank overdrafts are shown within borrowings in current liabilities.
Financial liabilities
Financial liabilities, which include bank loans, overdrafts, lease finance and trade and other payables, are measured initially at 
fair value net of transaction costs under the effective interest method and thereafter at amortised cost. Finance charges are 
accounted for on an accruals basis to the Income Statement. 
Derivative financial instruments and hedging arrangements
The Group has used derivative financial instruments in the current financial year to hedge its exposure to currency risk. The 
Group monitors its exposure and adopts derivative financial instruments where deemed appropriate and approved by the Board.
Derivatives are initially recognised at fair value on the date a derivative contract is entered into and are subsequently re-measured 
at their fair value at each balance sheet date, with movements reflected in the Income Statement. The Group does not use hedge 
accounting for its forward foreign currency contracts.
The Group does not use forward foreign currency contracts for speculative purposes.
(f) Intangible assets
(i) Goodwill
In respect of acquisitions since 1 April 2004, the date of IFRS transition, goodwill arising on consolidation represents 
the excess of cost of acquisition over the Group’s interest in the fair value of the net identifiable assets and liabilities of 
the acquired entity at the date of acquisition. For acquisitions prior to this date, goodwill is included on the basis of its 
deemed cost. Goodwill is recognised as an asset and assessed for impairment at least annually. Impairment is assessed 
by comparing the goodwill with the discounted cash flows projected for the acquired cash-generating unit, using a pre-tax 
discount rate that management estimate to be the risk adjusted average cost of capital for the Parent Company.
(ii) Research and development
Research expenditure is written off as incurred. Expenditure on a development project will be written off as incurred unless 
and until:
 (i) the project is identified as being:
 (a) for a new or substantially improved product or process;
 (b) technically feasible; and
 (c) commercially feasible, and probable that recovery will take place and 
(ii)   measurable costs can be attributed to the asset and adequate resources are available to complete the project.
For a project meeting these criteria, subsequent costs will be capitalised and amortised from the date the product or 
process is available for use on a straight-line basis over the product’s estimated life.
(iii) Acquired intangible assets
Intangible assets that are acquired as a result of a business combination are recorded at fair value at the acquisition date, 
provided they can be separately and reliably measured. The assets are amortised on a straight-line basis over their expected 
useful lives.
(g) Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and any impairment loss. Cost comprises the 
purchase price and costs directly incurred in bringing the asset into use. Where assets are in the course of construction at the 
balance sheet date, they are classified separately and not depreciated.
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38
 Notes to the Financial Statements continued
for the year ended 31 March 2009
1. Significant Accounting Policies continued
(g) Property, plant and equipment continued
Depreciation is charged so as to write off the cost of assets to their residual value over their expected useful lives using the 
straight-line method. The principal rates are as follows:
Freehold land Nil
Leasehold properties Over the lease period
Plant and equipment  7%–33%
(h) Leases
Leasing agreements that transfer substantially all the risks and rewards of ownership to the Group are classified as Finance 
Leases. Assets financed by a Finance Lease are accounted for as if they had been purchased outright, with the corresponding 
liability to the leasing company included as an obligation. The rentals payable are apportioned between interest, which is charged 
to the Income Statement, and capital, which reduces the outstanding obligation. All other leases are classified as Operating Leases 
and lease rentals are charged to the Income Statement on a straight-line basis over the term of the lease. Depreciation of finance 
leased assets is consistent with that for owned assets unless there is no reasonable certainty that the Group will obtain ownership 
by the end of the lease term, in which case depreciation is straight-line over the period of the lease. Interest is charged to the 
Income Statement so as to produce a constant periodic rate of interest on the remaining balance of the liability. Benefits received 
and receivable as an incentive to enter into an Operating Lease are also spread on a straight-line basis over the lease term.
(i) Impairment of non-current assets
All non-current assets are assessed annually for indications of impairment. Where impairment is likely, the fair value is measured 
and any impairment loss is charged to the Income Statement. For goodwill, an impairment review is carried out at each 
balance sheet date. The recoverable amount is the higher of fair value less cost to sell and value in use. In assessing value in 
use, the estimated future cash flows are discounted to their present value using a pre tax discount rate that reflects current 
market assessment of the time value of money and risks specific to the asset. An impairment loss is recognised in the Income 
Statement. With the exception of Goodwill, an impairment charge may be reversed if the non current asset or cash generating 
unit’s recoverable amount exceeds its carrying value.
(j) Inventories
Inventories are valued on a first-in, first-out basis at the lower of cost and estimated net realisable value, due allowance being 
made for obsolete and slow-moving items. Work in progress includes the cost and relevant proportion of production overhead 
assuming normal levels of activity. Net realisable value is the estimated selling price less the estimated costs of completion and 
selling expenses.
(k) Employee benefits
(i) Defined contribution plans
Obligations for contributions to defined contribution pension plans are recognised as an expense in the Income Statement 
as and when they are due.
(ii) Defined benefit plan
The Group’s net obligation in respect of its defined benefit pension plan is calculated by estimating the amount of future 
benefit payable to members, discounted to present value, and deducting the fair value of the plan assets. The calculation 
is performed by a qualified actuary, with liabilities assessed using the projected unit credit method and discounted using 
the market yield on high quality corporate bonds that are nearest to matching the maturity of the scheme. Actuarial gains 
and losses are included in the Statement of Recognised Income and Expense. Current and past service costs, curtailments 
and settlements are recognised within operating profit. Expected return on scheme assets and interest on obligations are 
recognised as a component of financing costs.
(iii) Share-based payment transactions
Share-based incentive arrangements are provided to employees under the Group’s share option and other share award 
schemes. Share-based arrangements put in place since 7 November 2002 are valued at the date of grant or award and 
charged to operating profit over the performance or vesting period of the scheme. Options are valued using an appropriate 
pricing model (Black-Scholes). The annual charge is modified to take account of shares forfeited by employees who leave 
during the performance or vesting period and where it becomes unlikely that the option or shares will vest.
(l) Provisions
A provision is recognised in the Balance Sheet when the Group has a legal or constructive obligation as a result of a past event. 
The provisions are not discounted.
(i) Warranty
 Provision for warranty is made only for those customer claims in respect of which the Group expects to incur liability.
(ii) Restructuring
 A provision for restructuring is recognised when the Group has approved a detailed and formal restructuring plan, and the 
restructuring either has commenced or has been announced publicly. Future operating costs are not provided for.
(m) Revenue recognition
Revenue is recognised by the fair value of consideration receivable excluding VAT.
(i)  Sales r epr esent the invoiced value of goods, where the significant risks and rewards of ownership have been transferred to 
the buyer. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration due or the 
possible return of goods. The sale is recognised at the date the goods are dispatched to the customer.
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1. Significant Accounting Policies continued
(m) Revenue recognition continued
(ii) Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate 
applicable.
(n) Government grants
Government grants are recognised in the Balance Sheet initially as deferred income in note 20. Grants in respect of assets are 
transferred to the Income Statement as other operating income over the estimated useful life of the asset concerned. Grants to 
compensate for expenses are transferred to the Income Statement in the same periods as the expenses are incurred.
(o) Taxation
The tax charge for the year includes the charge for tax currently payable and deferred taxation. The current tax charge represents 
the estimated amount due that arises from the operations of the Group in the financial year and after making adjustments in 
respect of prior years.
Deferred tax is recognised in respect of all differences between the carrying amount of assets and liabilities in the financial 
statements and the corresponding tax bases used in the computation of taxable profit, except where the temporary difference 
arises from goodwill or from the initial recognition of assets or liabilities that affect neither accounting nor taxable profit.
A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which 
the asset can be utilised.
Deferred tax is measured at the tax rates that are enacted or substantially enacted at the Balance Sheet date.
(p) Equity
Ordinary shares are classified as equity which is determined by the nominal value of shares that have been issued to date. When 
the Company purchases its own shares, the consideration is deducted from shareholders’ equity until the shares are either 
cancelled or reissued. When this happens any consideration received is included in equity attributable to equity shareholders. 
The share premium account represents premiums received on the initial issuing of the Share Capital.
Other reserves comprise a S131 CA1985 merger reserve created on acquisitions in prior years. 
Retained earnings include all current and prior year results as disclosed in the income statement. The hedging and translation 
reserve show impact of foreign currency movements on consolidation.
(q) Dividend distribution
The annual final dividend is not provided for until approved by shareholders, whilst interim dividends are charged in the period 
when they are paid.
(r) Exceptional operating items
Exceptional operating items are material items which individually or, if of a similar type, in aggregate, need to be disclosed by 
virtue of their size or incidence because of their relevance to understanding the entity’s financial performance.
2. Critical accounting judgements and key sources of estimation uncertainty
Financial Risk Management
Principal risks and uncertainties facing the Group are set out in the Directors’ Report on pages 21 and 22 of these financial 
statements.
 The Group makes estimates and assumptions about the future. The resulting accounting estimates seldom equal the related actual 
results. The key sources of estimation uncertainty that have a material risk to the carrying value of assets and liabilities within the 
next financial year are discussed below:
Defined benefit scheme
Details of the Group’s defined benefit pension scheme are set out in notes 1 (k)(ii) and 5 of the financial statements. The scheme 
has been accounted for in accordance with IAS 19 “Employee benefits”. The main area of judgement and estimation is the valuation 
of the pension scheme liabilities, which represent the net present value of projected future pension payments. These calculations 
are performed by the scheme actuary, with whom the Directors have agreed the underlying assumptions to be applied. The key 
assumptions are rates of increase in pension benefits, mortality rates, inflation and the discount rate applied to produce the net 
present value. The discount rate is derived from market rates on AA corporate bonds at the balance sheet date. Sensitivities applied 
to the key assumptions and their impact on the scheme liabilities are set out in note 5 of these financial statements.
Goodwill
Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to which goodwill has 
been allocated. The value in use calculation requires the estimation of future cash flows expected to arise from the cash-generating 
unit and a suitable discount rate in order to calculate present value. Details are set out in note 12.
Recoverability of internally generated asset — research and development
During the year, management have considered the recoverability of the carrying value of development expenditure of £0.4 million on 
its balance sheet. The projects continue to progress satisfactorily and customer reaction has confirmed management’s estimates of 
anticipated revenues from the projects. Management are confident that the carrying amount of the asset is recoverable.
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 Notes to the Financial Statements continued
for the year ended 31 March 2009
2. Critical accounting judgements and key sources of estimation uncertainty continued
Key Judgements applying the Group’s accounting policies
The Group’s accounting policies are set out in Note 1. The key Judgements are as follows;
Capitalisation of development cost
The criteria for capitalisation of development costs are set out in note 1 (f) above. The Director’s have to apply their Judgement in 
deciding whether any research and development costs meet these criteria.
Deferred tax
Management consider it reasonable to recognise deferred tax assets attributable to the defined benefit pension scheme deficit, 
unused tax losses, accelerated capital allowances and other timing differences based on future profit projections.
3. Business and geographical segments
For management purposes, the Group is currently organised into three operating divisions, Satellite communications (Paradise 
Datacom), Microwave components & manufacturing services (Labtech Microwave), and Aerostructures (CML). These divisions 
are the basis on which the Group reports its primary segment information.
 2009 2008
 Sales Profit Margin Sales Profit Margin
Business segment £000 £000 % £000 £000 %
Satellite communications  18,338 3,631 20% 15,288 3,172 21%
Microwave components &
manufacturing services  7,302 4 0% 7,899 154 2%
Aerostructures   13,865 2,049 15% 12,878 1,778 14%
Eliminate intra-segment trading (229)   (103)  
Continuing operations 39,276 5,684 14% 35,962 5,104 14%
Central costs  (1,053)   (1,286)
Underlying operating profit 39,276 4,631 12% 35,962 3,818 11%
Net finance costs  (551)   (509)
Underlying profit before tax 39,276 4,080 10% 35,962 3,309 9%
Exceptional operating items (see note 7)  (417)   —
Taxation  (1,138)   (953)
Total for the period 39,276 2,525  35,962 2,356 
Intra-segment sales are charged at prevailing market rates.
 
 Assets Liabilities Net Assets Liabilities Net
 £000 £000 £000 £000 £000 £000
Satellite communications 23,559 (5,020) 18,539 20,047 (4,723) 15,324
Microwave components & 
manufacturing services 6,185 (3,352) 2,833 5,863 (4,500) 1,363 
Aerostructures 8,386 (4,451) 3,935 8,064 (4,654) 3,410 
Continuing operations 38,130 (12,823) 25,307 33,974 (13,877) 20,097 
Centre and consolidation adjustments (2,262) (1,063) (3,325) (2,189) 1,809 (380) 
Defined benefit pension obligation 1,698 (6,063) (4,365) 1,459 (5,212) (3,753)
Total for the period 37,566 (19,949) 17,617 33,244 (17,280) 15,964
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 3. Business and geographical segments continued
2009 Capital expenditure Funded by Amortisation Other
   Finance and  non-cash
 Tangible Intangible Lease depreciation Impairment expenses
 £000 £000 £000 £000 £000 £000
Satellite communications 499 207 — (498) — —
Microwave components &
manufacturing services 413 — (296) (444) (354) —
Aerostructures 472 — (71) (443) — —
Continuing operations 1,384 207 (367) (1,385) (354) —
Centre — — — (9) — —
Pension finance cost — — — — — (340)
Total for the period 1,384 207 (367) (1,394) (354) (340)
2008  Capital expenditure Funded by Amortisation Other
    Finance and non-cash
  Tangible Intangible Lease depreciation expenses
  £000 £000 £000 £000 £000
Satellite communications  210 204 — (401) —
Microwave components &
manufacturing services  150 — (100) (496) —
Aerostructures  597 — (453) (382) 2
Continuing operations  957 204 (553) (1,279) 2
Centre  —   (11) 5
Pension finance cost  — — — — (59)
Total for the period  957 204 (553) (1,290) (52)
Geographical segments
The Group’s operations are located in the United Kingdom, with the exception of Paradise Datacom LLC, which is registered in 
the USA.
 Sales Total assets Capital expenditure
 2009 2008 2009 2008 2009 2008
 £000 £000 £000 £000 £000 £000
UK 15,884  16,507  26,261  26,548  939  776 
Rest of Europe 6,922  6,486  — — — —
North America 7,173  6,159  11,305  6,696  652  385 
Rest of World 9,297  6,810  — — — —
 39,276  35,962  37,566  33,244  1,591  1,161 
The sales analysis in the above table is based on the location of the customer. The analysis of assets and capital expenditure is 
based on the location of the operation.
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 Notes to the Financial Statements continued
for the year ended 31 March 2009
 4. Inter est
  2009 2008
  £000 £000
Interest receivable
Bank deposit interest   12 27
Interest payable
Bank loans and overdrafts   (158) (341)
Finance leases  (100) (118)
Amortisation of loan arrangement fees  — (18)
Total  (258) (477)
5. Pension commitments
The Group operates a defined benefit pension scheme that was closed to new members in January 2000 and ceased further service 
accrual for employees in September 2002. The scheme has a net deficit, for which the Group agreed a Schedule of Contributions 
with the Trustee in May 2009. This requires payment of £820,000 a year for 3 years and £860,000 for 7 years thereafter, plus scheme 
expenses (previously £820,000 a year to 2016). In addition, the Group has arranged a £2.4 million guarantee in favour of the scheme, 
based on certain of the Group’s assets. The scheme owns the 999 year lease of the premises occupied by Labtech Ltd, a Group 
subsidiary, at Presteigne, Powys. The premises are let under a 24 year lease expiring in 2018 at a current commercial rental of
£75,750 per annum.
In 2008/09, the Group undertook a further project involving an invitation to certain of the non-pensioner members to transfer out of
the scheme. The offer included a supplementary sum to be paid by the Group. At the end of the year, 29 members had accepted the 
offer which closed at the end of April 2009. The scheme actuary has evaluated the effect of the transactions as a net curtailment
gain of £295,000. After the Group’s expected payments of £189,000, a net credit of £106,000 has been taken to the Income 
Statement. £183,000 remains to be paid over to the members upon finalisation of the procedures for transfer.
The defined benefit scheme was valued by the scheme actuary at 31 March 2009. The key assumptions applied were:
  At 31 March At 31 March
  2009 2008
  % %
Rate of increase in pensions in payment  2.70 3.50 
Discount rate  6.83  6.50 
Inflation  2.70  3.50
Expected return on plan assets (being the weighted average return for the scheme assets at
31 March, less administration expenses)  5.70 6.50
Mortality: On actuarial advice, the mortality assumptions were changed to the more prudent assumptions adopted by the Trustee 
for the latest triennial valuation of the scheme.
The market value of the assets and obligations of the defined benefit scheme, and the expected rates of return, are as follows:
  Long-term rate
  of return expected
 Value at 31 March  at 31 March
 2009 2008 2009 2008
 £000 £000 % %
Equities 7,490  10,290  7.50  8.00 
Freehold property 700  700  9.00  9.00 
Property fund 562  702  7.50  8.00 
Government Bonds 1  1  3.75  4.60 
Corporate Bonds 1,313  1,947  6.83  6.50 
Cash 147  240  0.50  5.25 
Fair value of assets 10,213  13,880   
Present value of scheme obligations (16,276) (19,092)   
Actuarial deficit (6,063) (5,212)  
Deferred tax 1,698  1,459   
Actuarial deficit after deferred tax (4,365) (3,753)  
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 5. Pension commitments continued
The sensitivities regarding the principal assumptions used to measure the scheme liabilities are set out below:
Assumption Change in assumption Impact on scheme liabilities
Discount rate Decrease by 0.5% Increase by £1.06 million
Rate of inflation Increase by 0.5% Increase by £0.57 million
Rate of mortality Increase by 1 year Increase by £0.57 million
The Group’s policy is to recognise all actuarial gains and losses immediately. Consequently there are no unrecognised gains or
losses. The cumulative amount recognised since 1 April 2004 is a loss of £6,076,000 (2008: £4,169,000).
  2009 2008
  £000 £000
Movement in scheme obligations during the year:
As at 1 April  (19,092) (20,699)
Interest  (1,203) (1,101)
Curtailment and settlement gain  295 72
Distributions  1,410 1,108 
Actuarial gains and losses  2,314 1,528
As at 31 March  (16,276) (19,092)
Movement in scheme assets during the year:
As at 1 April  13,880 15,416 
Distributions  (1,410) (1,108)
Contributions  1,066 931 
Expected return on assets  898 1,042 
Actual return (loss £(3,323,000) (2008: profit £1,359,000)) less expected return on assets  (4,221) (2,401) 
As at 31 March  10,213 13,880 
The amounts reflected in the Group’s Income Statement are as follows:
  2009 2008
  £000 £000
Operating profit recognised in Administration expenses
 Curtailment gain  295 72
 Settlement cost  (189) —
Total  106 72
Net finance cost
 Expected return on pension scheme assets  898 1,042 
 Interest on pension scheme obligations  (1,203) (1,101)
Total  (305) (59)
The actuarial gains and losses are recognised net of tax in the Statement of Recognised Income and Expense:
Actual return less expected return on scheme assets  (4,221) (2,401) 
Actuarial gains and losses arising on scheme obligations  2,314 1,528
  (1,907) (873)
Less: deferred tax thereon  534 244 
Actuarial gains and losses  (1,373) (629)
The history of experience gains and losses is as follows: 2009 2008 2007 2006 2005
  £000 £000 £000 £000 £000
Fair value of assets  10,213 13,880 15,416 14,944  12,107
Present value of scheme obligations  (16,276) (19,092) (20,699) (27,992) (25,025)
Deficit  (6,063) (5,212) (5,283) (13,048) (12,918)
Difference between the expected and actual return 
on scheme assets:
Amount (£000)  (4,221) (2,401) (271) 1,886  (73)
Percentage of scheme assets  -41% -17% -2% 13% -1%
Experience gains and losses on scheme liabilities:
Amount (£000)  2,314 1,528 56 (2,829) (2,065)
Percentage of present value of the scheme obligations 14% 8% 0% -10% -8%
Defined contribution schemes
The Group also operates defined contribution schemes for all qualifying employees. The assets of the schemes are held separately 
from those of the Group. In 2009, £462,000 was expensed (2008: £415,000), representing contributions payable to these schemes
by the Group at rates specified in the scheme rules.
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 Notes to the Financial Statements continued
for the year ended 31 March 2009
 6. Analysis of profit before taxation
  2009 2008
The profit before taxation is stated after charging:  £000 £000
Realised foreign exchange losses  105  4 
Depreciation of tangible assets  1,170  1,133 
Impairment of tangible assets  354  
Research and development expenses  2,667  1,978 
Amortisation of capitalised development costs (included in Research and development expenses)   224  157 
Cost of inventories recognised as an expense  24,683  24,579 
Impairment of trade receivables  14  34 
Auditors’ remuneration (see note below)  83 98 
Staff costs (see note 8)  13,897  12,493 
Operating lease rentals:  plant hire  5  128 
 property  815  715
Loss on sale of fixed assets  7 1
Fair value of derivative financial instruments (forward contracts)  8  — 
and after crediting:  
Deferred income from government grants  7  7 
Gain on sale of fixed assets  10  11 
Fees payable to the Company’s auditors comprise:  
Services to the Company and its subsidiaries:  
Audit of the financial statements of the Group and subsidiaries  54 54 
Audit of the financial statements of the parent company  5 5 
Other services pursuant to legislation — regulatory reporting  1 1 
Other services relating to taxation — compliance  20 20 
 — advisory  3 18 
  83 98 
Services to the Intelek pension scheme for audit of its financial statements   6 6 
Total fees   89 104 
7. Exceptional operating items
  2009 2008
 Note £000 £000
Gain arising on transfers from the defined benefit pension scheme  see note 5 106 —
Asset impairment and restructuring at Labtech (a) (470) —
Costs incurred on aborted transactions and dormant companies (b)  (53) —
   (417) —
(a) A review was undertaken of the resources at Labtech Microwave taking into account the reduction of volume sales activity and 
change of business strategy. The financial effect was a redundancy charge in the year of £116,000 and an impairment charge 
against fixed assets of £354,000, total £470,000.
(b) The Group undertook various studies on acquisition and disposal opportunities during the year that did not come to fruition. 
There was also an exercise commenced to liquidate dormant companies owned by the Group.
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 8. Employees
  2009 2008
  No. No.
The average monthly number of Group employees, including executive Directors, was:
Production  364 343 
Administration and sales  54 48 
  418 391 
Costs in respect of these employees were:  £000 £000
Wages and salaries  12,347 11,046 
Social security costs  1,088 1,032 
Other pension costs — defined contribution scheme (see note 5)  462 415 
  13,897 12,493 
Directors’ emoluments, pension arrangements and share options are disclosed in the Remuneration Report on page 30, details of 
which form part of these financial statements.
Related party transactions in the year are limited to compensation for senior executives identified on page 20. The remuneration of
the Directors is disclosed in the Remuneration Report on page 30. The remuneration of the divisional executives is detailed below:
  2009 2008
  £000 £000
Salaries and short-term benefits  389 329 
Bonus  82 93 
Post employment benefits  18 18 
  489 440 
9. Taxation
  2009 2008
  £000 £000
Continuing operations
UK Tax  — —
Overseas Tax:
Current tax on income for the year  (522) (486)
Adjustment in respect of prior years  (45) 69 
Total  (567) (417) 
Current taxation  (567) (417) 
Deferred taxation (note 19)  (571) (536)
Total taxation  (1,138) (953)
The differences between the total taxation for continuing operations shown above and the amount 
calculated by applying the standard rate of UK corporation tax to the profit before tax is as follows:
Profit on ordinary activities before taxation  3,663 3,309 
Theoretical tax at UK corporation tax rate 28% (2008: 30%)  (1,026) (993)
Effects of:
 different tax rates  (213) (63)
 adjustments in respect of prior years  (16) 77 
 research and development tax credit  61 17 
 export/manufacturing tax credit  28 23 
 other (expenditure) that is not tax deductible/income that is not taxable  28 (14)
Actual taxation  (1,138) (953)
Taxation on items charged to equity
Deferred tax credit on actuarial gains and losses on defined benefit plans (Continuing operations)  534 244
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 Notes to the Financial Statements continued
for the year ended 31 March 2009
 10. Earnings per Share
Basic earnings per share (EPS) were calculated based on the profit for the year divided by the weighted average number of ordinary 
shares outstanding during the period, excluding those held by the Employee Share Trust and those held by Directors that remain 
subject to performance conditions. These excluded shares are accounted for as an investment in own shares (see note 26). The total 
for 2009 was 84,951,439 (2008: 84,833,409). Diluted EPS is calculated by adjusting the number of shares used in the basic EPS 
calculation to assume conversion of all dilutive potential ordinary shares resulting from outstanding employee share plans. There were 
330,500 exercisable share options in existence at the year end (2008: 340,500) the exercise price for which is below the average fair 
value of 15.6p per share of the ordinary shares in issue during the year. These create a dilution in shares of 238,830 (2008: 232,167).
In order to provide a trend measure of underlying performance, the Board also monitors underlying EPS, computed as follows:
 Earnings EPS
 2009 2008 2009 2008
 £000 £000 p p
Profit for the year 2,525 2,356 2.97 2.78
Add back: Exceptional operating items (see note 7) 417 — 0.49 —
Tax on these items (117) — (0.14) —
Underlying 2,825 2,356 3.32 2.78
Effective tax rate on underlying profit 31% 29%  
11. Dividends
The following dividend payments have been made on the Ordinary 5p shares in issue:
    2009 2008
 Rate Date Shares in issue £000 £000
Final 2006/07 0.26p 26 September 2007 87,376,072  227
Interim 2007/08 0.15p 23 January 2008 87,376,072  131
Final 2007/08 0.30p 24 September 2008 87,376,072  262 —
Interim 2008/09 0.165p 21 January 2009 87,376,072  144 —
Less: dividends paid on shares in the employee share trust   (3) (3)
    403  355
At 31 March 2009, the 2008/09 final dividend had not been approved by Shareholders and as such was not included as a liability.
The dividend is expected to be £262,000, 0.30 pence per share, and to be paid on 23 September 2009 to shareholders on the
register at 28 August 2009.
12. Goodwill
  2009 2008
  £000 £000
Cost
At 1 April  15,667 15,696
Exchange adjustment  739 (29)
At 31 March  16,406 15,667 
Amortisation/impairment
At 1 April  (2,301) (2,305)
Exchange adjustment  (80) 4
At 31 March  (2,381) (2,301)
Net book value
At 31 March  14,025 13,366
The goodwill relates entirely to the satellite communications business segment, a cash-generating unit. No impairment has been 
recognised in either 2008 or 2009. The recoverable amount of the business segment is evaluated based on its value in use. The 
exchange adjustment arises on translation of the goodwill held in US$ for one of the investments in the business segment.
Impairment
During the year, the goodwill was tested for impairment against cash flow projections for the unit discounted at management’s 
estimate of the risk adjusted cost of capital. The Group tests annually for impairment, or more frequently if there are indicators 
that goodwill might be impaired. Management’s key assumptions for its cash flows are based on their past experience and future 
expectations of the market. The satellite communications business was acquired in 2001 and hence there is a good historical trend 
analysis on which to base expectations. The cash flows were taken from the unit’s business plan for 2010 to 2012, extended for
seven years thereafter at the projected market growth rate of 2.5%. The pre-tax discount rate applied was 11% based on the 
weighted average cost of capital based on its cost of equity and cost of debt. These assumptions reflect management’s past 
experience and are consistent with external sources of information. After applying a sensitivity analysis to the results, in particular
for presumed growth rates, management concluded that no impairment was required. Management are not aware of any other 
changes that would necessitate changes in its key estimates and sensitivities to revenues.
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 13. Intangible assets
  2009 2008
Development    £000 £000
Cost
At 1 April  711 508
Exchange adjustment  141 (1)
Additions  207 204
At 31 March  1,059 711
Amortisation
At 1 April  (328) (171)
Exchange adjustment  (21) —
Charge for the year  (224) (157)
At 31 March  (573) (328)
Net book value
At 31 March  486 383
The additions relate entirely to assets acquired from third parties. The useful economic life of the intangible assets is three years. 
Amortisation is charged to Research and Development expenses in the Income Statement.
14. Property, plant and equipment
 Freehold Leasehold Plant and
 properties properties Equipment Total
 £000 £000 £000 £000
Cost at 1 April 2007 12  971 17,714 18,697 
Exchange adjustment — —  (21) (21) 
Additions — 12  945 957 
Disposals — — (71) (71)
Cost at 31 March 2008 12  983 18,567 19,562 
Exchange adjustment — — 683  683
Additions — 40  1,344  1,384
Disposals — — (1,247) (1,247)
Cost at 31 March 2009 12  1,023 19,347 20,382
Depreciation at 1 April 2007 (1) (382) (12,263) (12,646)
Exchange adjustment — — 15 15
Charge for the year — (64) (1,069) (1,133)
Disposals — — 66 66 
Depreciation at 31 March 2008 (1) (446) (13,251) (13,698)
Exchange adjustment — — (466) (466)
Charge for the year — (50) (1,120) (1,170)
Impairment loss — — (354) (354)
Disposals — — 1,217 1,217
Depreciation at 31 March 2009 (1)  (496) (13,974) (14,471)
Carrying Amount  31 March 2009 11  527 5,373 5,911
 31 March 2008 11 537  5,316 5,864 
The impairment loss on plant and equipment arose in connection with the restructuring of Labtech Microwave (see note 7).
The carrying amount of plant and equipment includes £3,001,000 (2008: £3,303,000) in respect of assets held under finance 
leases, the depreciation charge on which amounted to £656,000 (2008: £508,000). The carrying amount of leasehold properties 
includes £216,000 (2008: £221,000) in respect of a long leasehold property and £311,000 (2008: £316,000) in respect of short 
leasehold property.
At 31 March 2009, the Group had entered into contractual commitments for the acquisition of property, plant and equipment 
amounting to £184,000 (2008: £190,000).
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 Notes to the Financial Statements continued
for the year ended 31 March 2009
 15. Inventories
  2009 2008
  £000 £000
Raw materials and components  3,800 2,147 
Work in progress  1,980 1,394 
Finished goods  324 165 
  6,104 3,706 
The above inventory has been pledged as security for the Group’s bank loans and overdrafts.
In the Directors’ opinion, the replacement cost of inventories does not differ materially from the stated amounts.
16. Trade and other receivables
  2009 2008
  £000 £000
Trade receivables  Gross  7,030 5,834 
 Provision for impairment  (62) (97)
Other receivables  12 61 
Prepayments and accrued income  513 494 
  7,493 6,292 
The Group has no significant concentration of credit risk, with trade receivables spread over a large number of customers and 
representing an average of 57 days of sales (2008: 46 days). 
After considering individual amounts due and the probability of recovery, provision for impairment has been taken or released as set 
out below:
  2009 2008
Provision for impairment  £000 £000
Balance brought forward at 1 April  (97) (71)
Exchange adjustment  (17) —
Impairment loss recognised  (14) (34)
Amounts written off as uncollectable  15 8
Amounts recovered  51 —
Balance carried forward  (62) (97)
Included in the provision for impairment are individually impaired receivables, the ageing for which is:
  2009 2008
  £000 £000
Up to 90 days  (55) (77)
90–120 days  — —
120+ days  (7) (20)
  (62) (97)
Included in the Group’s trade receivables are the following amounts that are past due at the reporting date, but for which the Group 
has not provided:
  2009 2008
Period overdue  £000 £000
Up to 90 days  1,127 856
90–120 days  90 6
120+ days  149 142
  1,366 1,004
The Directors believe that there is no further impairment provision required and that the carrying amounts of trade and other 
receivables approximate to their fair values. The Group reserves its right to charge interest on overdue receivables, with each case 
being dependent on its commercial circumstances.
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 17. Current tax (liabilities)/assets
  2009 2008
  £000 £000
Overseas taxation  (47) 112 
18. Cash and cash equivalents
Cash and cash equivalents comprise cash held by the Group and short-term bank deposits with maturity of three months or less. 
The carrying value of these assets approximates to their fair value. The credit risk on liquid funds is limited because counterparties 
are banks with high credit ratings assigned by international credit-rating agencies.
  2009 2008
  £000 £000
Cash  35 206 
Cash held on deposit  978 1,039 
  1,013 1,245 
19. Deferred taxation
    Defined  Other
    benefit Capital timing
    pension allowances differences Losses Net
At 1 April 2007    1,479  (70) 452  252  2,113 
Charge to Income Statement    (264) 169  (245) (196) (536)
Charge to Equity    244  — — — 244 
Exchange adjustment    — 3  2  — 5 
At 31 March 2008    1,459  102  209  56  1,826 
Comprising: Deferred tax asset   1,459  275  486  56  2,276 
 Deferred tax liability   — (173) (277) — (450)
At 1 April 2008
Charge to Income Statement    (295) (92) (182) (2) (571)
Charge to Equity    534  — — — 534 
Exchange adjustment    — (91) (138) — (229)
At 31 March 2009    1,698  (81) (111) 54  1,560 
Comprising:  Deferred tax asset   1,698  333  449  54  2,534 
 Deferred tax liability   — (414) (560) — (974)
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 Notes to the Financial Statements continued
for the year ended 31 March 2009
 20. Deferred government grants
  2009 2008
  £000 £000
At 1 April  (78) (86)
Grants received  (129) — 
Income Statement  7 8
At 31 March  (200) (78)
21. Trade and other payables
  2009 2008
  £000 £000
Trade payables  (3,605) (2,898)
Other taxes and social security  (657) (616)
Other payables  (510) (414)
Accruals   (2,916) (2,453)
  (7,688) (6,381)
22. Provisions and other liabilities
 2009 2008
 Restructuring Warranty Total Restructuring Warranty Total
 £000 £000 £000 £000 £000 £000
At 1 April (34) (16) (50) (251) (14) (265)
Exchange adjustment  (12) (12) — — —
Income Statement (77) (86) (163) — (2) (2)
Utilised 27 19 46 217 — 217
At 31 March (84) (95) (179) (34) (16) (50)
The warranty and restructuring provisions are not discounted and are estimated to be fully utilised within 12 months. The restructuring 
provision relates to redundancy costs at Labtech Microwave.
23. Share capital
  2009 2008
  £000 £000
Authorised:
110,000,000 (2008: 110,000,000) Ordinary 5p shares  5,500 5,500 
Allotted and fully paid:
87,376,072 (2008: 87,376,072) Ordinary 5p shares  4,369  4,369 
Share options
Details of the Group share option schemes are set out in the Remuneration Report on page 29. At 31 March 2009 there were 
outstanding options under the Executive Scheme in respect of 1,185,000 ordinary shares, exercisable between 2009 and 2013 at 
prices varying between 10.5p and 35.5p per share.
The movement in the year in respect of share options is analysed as follows:
      Exercise
Scheme Date of grant 2009 Exercised Lapsed 2008 price (p) Expiry
1995 approved 20/08/99 55,000  — — 55,000  20.0 21/08/09
 28/01/00 7,500  — — 7,500  33.0 29/01/10
 27/07/00 7,500  — — 7,500  35.0 28/07/10
2000 approved 20/12/00 50,000  — — 50,000  35.5 19/12/10
 10/08/01 99,500  — (10,000) 109,500  34.0 09/08/11
 08/08/02 73,000  — — 73,000  14.0 07/08/12
 08/01/03 157,500  — (10,000) 167,500  10.5 07/01/13
2000 unapproved 10/08/01 135,000  — — 135,000  34.0 09/08/11
 08/08/02 500,000  — — 500,000  19.0 11/02/12
 08/01/03 100,000  — — 100,000  10.5 07/01/13
  1,185,000  — (20,000) 1,205,000 
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 24. Share-based payments
Share options
In accordance with IFRS 2 “Share-based payment”, the Group has appraised share options granted after 7 November 2002. The 
only options applicable to date are those issued on 8 January 2003 at a price of 10.5p, expiring on 7 January 2013. The options were 
issued conditional upon achieving growth in earnings per share at a rate in excess of 2% a year above the retail price index over any 
consecutive three years in the ten year period from 31 March 2002. This condition was met following announcement of the results for 
the year to 31 March 2006. To date, none of the options has been exercised. The details are as follows:
 2009 2008
  Weighted  Weighted
  average  average
 No. price No. price
Outstanding at 1 April 267,500 10.5p 267,500 10.5p
Options forfeited (10,000) 10.5p — 10.5p
Outstanding and exercisable at 31 March 257,500  10.5p 267,500  10.5p
For these options, the fair value has been assessed, applying the Black-Scholes option pricing model. The model assumed volatility 
of 39.1%, expected dividend yield of 2.8%, risk-free interest rate of 4.2%. On this basis, the fair value of the options at grant date 
was 3.8p. No accrual has been taken to the Income Statement as the amounts are not material. At 31 March 2009, a cumulative 
charge of £10,000 would have been accrued (2008: £10,000).
Long-Term Incentive Plan
In October 2006, the Group introduced a Long-Term Incentive Plan (LTIP) under which shares are issued by Intelek’s ESOP trust 
to selected senior managers at grant date, subject to compulsory sale back to the trust at a nominal price to the extent that 
performance conditions are not met. The awards are split equally into two measurement periods, 3 years and 5 years, and again 
into two categories of performance condition, EPS and Share Price. For the EPS tranches, actual adjusted EPS at the end of the 
measurement period is compared with the target EPS. For the Share Price tranches, the growth in share price is compared with the 
growth in the techmark 100 index over the measurement period. The targets are set by the Remuneration Committee. In all cases, if 
less than 80% of the target is met, none of the shares vest, if 80%, 25% vest, if 120%, 100% vest, and pro rata between 80% and 
120%. During the measurement period, the senior managers own the voting rights attaching to the shares and receive dividends. 
However, to the extent that the shares do not vest, the dividends, less tax, have to be paid over to the Trust.
The first award under the LTIP was made in October 2006 to Mr Ian Brodie and Mr Kevin Edwards, details of which are set out in 
the Remuneration Report. In total, 1,750,000 shares were issued at 12.5p a share. Under IFRS 2, the cost of this benefit is required 
to be estimated and taken over the measurement period. As the shares have already been issued, the price is known and has been 
applied to the projected number of shares that will vest. For the EPS tranches, the number of shares has been computed based 
on management projections of EPS. For the Share Price tranches, the number of shares has been computed assuming that (a) 
the share price will grow in line with EPS, modified for the market’s perception of risk, and (b) the techmark 100 index will grow 
consistent with the 3-year period 31.3.04 to 31.3.07. In 2009, a provision of £45,000 has been charged to the Income Statement 
(2008: £43,000), increasing the provision to £111,000 (2008: £66,000).
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 Notes to the Financial Statements continued
for the year ended 31 March 2009
 25. Statement of changes in equity
 
      Distributable reserves
  Share Own Other Hedging Translation Retained 
  capital shares reserves reserve reserve earnings Net
  £000 £000 £000 £000 £000 £000 £000
At 1 April 2007  4,369 (488) 3,411 7 (220) 7,465 14,544
Disposal of own shares (see note 26) — 59 — — — — 59
Exchange difference on hedging  — — — 24 — — 24
Exchange difference on translation of
overseas operation  — — — —  (35) —  (35)
Actuarial losses arising on defined
benefit pension plan net of deferred tax — — — — — (629) (629)
Dividends paid  — — — — — (355) (355)
Transfer from profit and loss account — — — — — 2,356 2,356
At 31 March 2008  4,369 (429) 3,411 31 (255) 8,837 15,964
Disposal of own shares (see note 26) — 11 — — — — 11
Exchange difference on hedging — — — (889) — — (889)
Exchange difference on translation of
overseas operation  — — — — 1,782 — 1,782
Actuarial losses arising on defined 
benefit pension plan, net of 
deferred tax  — — — — — (1,373) (1,373)
Dividends paid  — — — — — (403) (403)
Transfer from profit and loss account — — — — — 2,525 2,525
At 31 March 2009  4,369 (418) 3,411 (858) 1,527 9,586 17,617
Other reserves comprise a Merger Reserve created on acquisition in prior years. The hedging reserve represents the accumulated 
net currency variations on the Group’s net investment hedge (explained in note 32). The translation reserve represents the translation 
differences on the consolidation of the US operations’ asset and liabilities.
26. Own shares
Own shares represent the cost of shares in Intelek plc purchased in the market and held by the Intelek plc Employee Share 
Ownership Plan (ESOP), and shares issued under the Executive LTIP but not yet vested.
The Intelek plc ESOP trust was established by a deed on 7 November 1991 made between the Company and EFG Reads Trustees 
Limited of Jersey. The trust was established for the benefit of the bona fide employees or former employees of the Company and 
other Group Companies (“the Beneficiaries”). The trust is a discretionary trust whose assets are shares in the Company and the 
Trustees have full authority and power to distribute such shares as they deem fit to the Beneficiaries. In addition, the Trustees may 
satisfy options granted by the Company to participants in one or more of the Group’s share option schemes should the Trustees, 
with the agreement of the Company, decide to do so.
Administration costs amount to £5,000 per annum. As of 31 March 2009, the Trust held 620,545 (2008: 690,060) Ordinary shares of 
5p each in the capital of the Company. As of 31 March 2009, 1,185,000 (2008: 1,205,000) shares of the Company are under option 
to the participants in the Group’s Share Option Schemes and the Trustees may by agreement with the Company use all or any of the 
shares in the Trust to satisfy such options. During the year, 69,515 of the shares were sold at 17p to provide shares for the executive 
bonus schemes. In addition, the Trust held signed transfer documents in respect of a further 1,750,000 shares issued under the 
Executive LTIP . These shares will be sold to the Trust for a nominal value to the extent that the LTIP performance conditions are not 
satisfied. For accounting purposes, these shares are included as part of the investment in Own Shares until vesting under the LTIP . 
The total investment in own shares is 2,370,545 (2.7% of the allotted share capital), the market value of which at 31 March 2009 was 
£338,000 (2008: £341,000), i.e. 14.3p per share (2008: 14.0p per share). Dividends on these shares have not been waived.
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 27. Cash generated from operations
  2009 2008
  £000 £000
Underlying operating profit  4,631 3,818 
Depreciation and amortisation   1,394 1,290 
Pension contribution paid towards deficit  (1,066) (931)
Pension curtailment gain (net of expenses)  — (13)
Deferred income  (7) (7)
Profit on disposal of tangible fixed assets  (3) (10) 
(Increase)/decrease in inventories   (1,521) 139
(Increase)/decrease in receivables   (467) 161
Increase in payables   313 32 
Net cash flow before exceptional items  3,274 4,479 
Pension transfer project  — (190)
Other exceptional operating items  (114) (188)
Cash generated from continuing operations  3,160 4,101 
28. Reconciliation of net cash flow to movement in net debt
  2009 2008
  £000 £000
Net increase in cash and cash equivalents  484 1,157
Effect of foreign exchange rates  (619) 35
Repayment of finance leases  704 768 
Cash inflow from debt  (123) (144)
Changes in net debt resulting from cash flows  446 1,816 
New finance leases  (367) (554)
Net movement in debt  79 1,262
Opening debt  (3,864) (5,126)
Closing debt  (3,785) (3,864)
  2009 2008
Analysis of net debt:  £000 £000
Cash at bank  1,013 1,245 
Bank overdrafts and loans  (3,592) (3,566)
Finance leases  (1,206) (1,543)
Total net debt  (3,785) (3,864)
  2009 2008
Reconciliation of cash and cash equivalents  £000 £000
Cash and cash equivalents per balance sheet  1,013 1,245
Bank overdrafts included within ‘current liabilities — borrowings’  (956) (1,053)
Cash and cash equivalents per cash flow  57 192
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 Notes to the Financial Statements continued
for the year ended 31 March 2009
 29. Operating Lease Commitments
Commitments for future minimum lease payments under non-cancellable operating leases fall due as follows:
 2009 2008
 Properties Plant Total  Properties Plant Total
 £000 £000 £000 £000 £000 £000
Within one year 714  28  742  579 31 610
Between one and five years 2,487  41  2,528  2,150 61 2,211
After five years 2,942  — 2,942  2,865 — 2,865
 6,143  69  6,212  5,594 92 5,686
30. Contingent Liabilities and Assets
The Company is guarantor for the lease of the property occupied by Pascall Electronics on the Isle of Wight. The lease expires in 
2016 and is at a current rental of £273,000 per annum. As part of the disposal agreement for Pascall Electronics, the Company 
secured full indemnity for this guarantee from both the purchaser and the purchaser’s ultimate holding company. The Directors 
consider it unlikely that there will be a default that affects the Group under this guarantee. Even if there were to be a default, the 
Group would expect to be able to re-let the property and mitigate much of the liability.
31. Borrowings
a) Summary
  2009 2008
  £000 £000
Bank loans  (3,592) (3,566)
Finance leases  (1,206) (1,543)
  (4,798) (5,109)
Non-current liabilities  (2,987) (2,994)
Current liabilities  (1,811) (2,115)
  (4,798) (5,109)
Bank overdraft and loans are fully secured on the assets of the Group.
b) Borrowing facilities
The Group has the following undrawn committed borrowing facilities:
  2009 2008
  £000 £000
Expiring in less than one year  1,211 1,391
Expiring in more than one year but not more than two years  — —
In more than two years  2,192 2,696
  3,403 4,087
c) Finance leases
 2009 2008
 Minimum  Minimum 
 lease Present lease Present
 payments value payments value
 £000 £000 £000 £000
Within one year (598) (527) (677) (589)
One to five years (726) (679) (1,042) (954)
  
 (1,324) (1,206) (1,719) (1,543)
    
Less future finance charges 118   176 
   
Present value of lease obligations (1,206)   (1,543)
   
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 31. Borrowings continued
d) Interest
The weighted average interest rates paid were as follows:
  2009 2008
  % %
Bank loans  4.4 7.0
Finance leases  7.3 7.2
e) Principal features of the Group’s borrowings
The Group’s borrowing facilities are secured by a debenture over the Group’s assets and unlimited cross guarantees given by the 
Company and certain subsidiary undertakings. The Group has a US$ denominated bank loan of £328,000 being repaid at £164,000 
a quarter. It will be fully repaid by September 2009. The interest rate on the loan is 1.50% above the bank’s base rate.
32. Financial Instruments
The Group’s financial instruments comprise borrowings, cash and cash equivalents and various items such as trade and other 
receivables and trade payables that arise directly from its operations. The main purpose of these instruments is to raise finance for 
operations. The Group has entered into financial derivative instruments using forward foreign currency contracts, which are
described in more detail below. The main risks arising from the Group’s financial instruments are interest rate risk, liquidity risk and 
foreign currency risk. The Board’s policy on these risks is described in note 1 on significant accounting policies and in the Directors’ 
Report, which forms part of these financial statements.
Capital Risk Management 
Operations are financed through a mixture of retained profits, lease finance and bank borrowings. Other than finance leases and 
loan notes, the Board’s policy is to use variable rate borrowings. To ensure continuity of debt funding the Group’s policy is to keep a 
substantial part of debt as due in more than one year’s time. Short-term flexibility is achieved by overdraft facilities.
Carrying and fair values of the Group’s financial assets and liabilities at 31 March:
 2009 2008
 Carrying  Carrying 
 value Fair value value Fair value
Categories of financial instruments £’000 £’000 £’000 £’000
Financial assets (all held as loans and receivables)
— trade and other receivables 6,980  6,980  5,798 5,798
— cash and cash equivalents 1,013  1,013  1,245 1,245
Financial liabilities (held at amortised cost)
— borrowings bank loans (3,592) (3,592) (3,566) (3,566)
 finance leases (1,206) (1,200) (1,543) (1,529)
— trade and other payables (4,772) (4,772) (3,928) (3,928)
   2009 2008
   £000 £000
Forward foreign currency contracts (held in accruals at fair value through the profit and loss/account)  (8) —
Management consider the fair values to approximate to the present value of future cash flows based on market rates.
Management have appraised the sensitivity of the financial result to interest and currency movement as:
(i) a 1% increase in interest rates for variable borrowings would have reduced profit and equity by about £35,000.
(ii) a 1% strengthening in the value of sterling against all other currencies from the levels applicable at 31 March 2009 would have 
reduced profit and equity by about £40,000.
Financial risk management objectives
Management monitor and manage financial risks relating to its operations through it management and review of internal reports. The 
Group is not significantly exposed to interest, credit or liquidity risk and will enter into derivative financial instruments to reduce its
risk to currency exposure with approval from the Board.
Foreign currency risk management
The Group undertakes certain transactions in US Dollar and in Euro, hence its does have exposure to exchange rate fluctuations. 
Exchange rate movements are monitored within approved parameters and the Group holds certain amounts of Euro and US dollar 
as a natural hedge. During the year, management decided to take out certain forward foreign currency contracts to the value of 
US$825,000 at the year end. The Group doesn’t enter into or trade in financial instruments, including derivative financial instruments, 
for speculative purposes. Whilst the Group entered into forward foreign currency contracts during the year to mitigate currency risk, 
it does not apply hedge accounting in the financial statements, and therefore accounts for the contract at its fair value at the balance 
sheet date.
Net investment hedge
The Group has a US-based subsidiary company which can affect the sterling Group Balance Sheet as a result of movements in 
the sterling/dollar exchange rate. The Group has partly hedged the US subsidiary company’s net asset exposure at 31 March 2009 
using bank loans in US$. The net currency movements on the subsidiary net assets and the related bank loans are recognised at 
each year end and recorded through reserves. At 31 March 2009, the Group held $10 million net assets overseas and held loans of 
$4 million designated as a partial hedge against this exposure. The hedge has been tested for effectiveness at inception and at each 
reporting date.
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Report and Accounts 2009
56
 Notes to the Financial Statements continued
for the year ended 31 March 2009
 32. Financial Instruments continued
Forward foreign exchange contracts
At 31 March 2009, the aggregate amount of loss for forward currency exchange contracts taken out to hedge against future sterling 
purchases by the US Business was £8,000 (2008: £nil). This amount has been charged to the Income Statement during the year.
The currency and interest rate profile of the Group’s financial assets and liabilities that are subject to interest rate risk and currency 
risk at 31 March was:
 2009 2008
 Floating Fixed Floating Fixed
 Cash and Bank   Cash and Bank
 cash loans Finance  cash loans Finance 
 equivalent & overdrafts leases Total equivalent & overdrafts leases Total
 £000 £000 £000 £000 £000 £000 £000 £000
Sterling 20  (1,274) (1,206) (2,460) 15 (1,053) (1,543) (2,581)
US dollars 993  (2,318) — (1,325) 1,124 (2,513) — (1,389)
Euro — — — —  106 — — 106
 1,013  (3,592) (1,206) (3,785) 1,245 (3,566) (1,543) (3,864)
The floating rate financial liabilities bear interest at rates based on the Barclays Bank base rate. The fixed rate financial liabilities have 
a weighted average interest rate of 6.1% (2008: 7.2%) over a weighted average period of 2 years (2008: 3 years).
At 31 March, the Group’s financial liabilities have contractual maturities summarised below:
 2009 2008
   1–2 2–5   1–2 2–5
 Total Current years years Total Current years years
Bank overdrafts 
and loans (3,592) (1,284) — (2,308) (3,566) (1,526) (236) (1,804)
Finance leases (1,206) (527) (409) (270) (1,543) (589) (438) (516)
Trade and 
other payables (4,772) (4,772) — — (3,928) (3,928) — —
Derivative financial
instruments (8) (8) — — — — — —
 (9,578) (6,591) (409) (2,578) (9,037) (6,043) (674) (2,320)
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Five Year Summary
  2009 2008 2007 2006 2005
  £000 £000 £000 £000 £000
Sales
Continuing operations  39,276 35,962 36,840  35,212  31,524
Underlying Operating Profit  4,631 3,818 2,905  2,701  2,789
Interest  (246) (450) (373) (311) (447)
Net pension finance cost  (305) (59) (192) (584) (631)
Underlying Profit – Continuing operations  4,080 3,309 2,340  1,806  1,711
Exceptional operating items  (417) — 3,282 — (309)
Profit before taxation  3,663 3,309 5,622  1,806  1,402
Taxation  (1,138) (953) (1,789) (483) (493)
Profit after taxation  2,525 2,356 3,833  1,323 909
Discontinued operations  — — — — 1,893
Profit for the year  2,525 2,356 3,833  1,323  2,802 
Earnings per Ordinary share (pence)
Basic  2.97 2.78 4.53  1.56  3.31 
Diluted  2.96 2.77 4.53  1.56  3.31
Underlying: Continuing operations  3.32 2.78 2.05  1.56  1.33
Dividends per Ordinary share (pence)  0.465 0.45 0.39  0.36  0.36
Net debt  (3,785) (3,864) (5,126) (3,403) (2,344)
Total equity  17,617 15,964 14,544  11,390  10,998 
All information is prepared in accordance with IFRS.
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58
Company Balance Sheet
 as at 31 March 2009
   2009 2008
 Note £000 £000
Fixed assets
Investment in subsidiaries P3, P4 30,268 28,268
Tangible fixed assets P5 3 6
  30,271 28,274
Current assets
Amounts due from subsidiaries  5,590 8,017 
Other debtors  26 38
Deferred tax assets  91 253
Cash and cash equivalents  17 58 
Total current assets  5,724 8,366
Creditors: Amounts falling due within one year
Borrowings P6 (2,081) (1,337)
Amounts due to subsidiaries  (343) (51)
Trade and other creditors  (381) (526)
  (2,805) (1,914)
Net current assets  2,919 6,452
Total assets less current liabilities  33,190 34,726
Creditors: Amounts falling due after more than one year
Borrowings P6 (2,308) (2,040)
Net assets  30,882 32,686
EQUITY
Issued capital  4,369 4,369 
Own shares  (418) (429)
Other reserves  604 604 
Retained earnings — non-distributable P7 14,494 14,494
 — distributable P7 11,833 13,648
Equity shareholders’ funds P8 30,882 32,686
The financial statements on pages 58 to 60 were approved by the Board of Directors and signed on their behalf on 10 June 2009 by:
I D Brodie K N Edwards
Director Director
 Intelek 
Report and Accounts 2009
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 Notes to the Intelek plc Balance Sheet
 Significant accounting policies and basis of preparation
The separate financial statements of the Company are presented as required by the Companies Act 1985. They have been prepared 
under the historical cost convention and in accordance with applicable United Kingdom Generally Accepted Accounting Practice and 
United Kingdom law.
Investments
Fixed asset investments in subsidiaries are shown at cost less provision for impairment.
Employee benefits: Defined benefit scheme
The Company participates in the Group’s multi-employer defined benefit pension scheme. The Company is unable to identify its share of 
the underlying assets of the scheme as the assets form a single fund. Consequently, the Company accounts for the scheme by expensing 
contributions as they become due. Details of the scheme assets and liabilities are set out in the notes to the Group’s financial statements.
Tangible fixed assets
Tangible fixed assets are stated at cost less accumulated depreciation. Depreciation is charged so as to write off the cost of the asset 
over its useful estimated economic life. The principal rate applied is:
Plant and equipment 7%–33%
Deferred taxation
Deferred tax is provided on timing differences that have arisen but not reversed by the balance sheet date, where the timing difference 
results in an obligation to pay more tax, or a right to pay less tax, in the future. Timing differences arise because of differences between 
the treatment of certain items for accounting and taxation purposes. Deferred tax assets are recognised to the extent that it is regarded 
as more likely than not that they will be recovered. Deferred tax is measured at tax rates that are expected to apply in the periods when 
timing differences are expected to reverse, based on tax rates enacted at the balance sheet date.
Cash flow and related party transactions
The Group consolidated financial statements contain a consolidated cash flow statement and therefore the Company has taken 
advantage of the exemption under FRS 1 not to present its own cash flow statement. Similarly, the Company has taken advantage of the 
exemption under FRS 8 not to disclose related party transactions.
Financial instruments
The Group financial statements include disclosure sufficient to satisfy FRS 25 and consequently, the Company has taken advantage of 
the exemption not to present separate financial instrument disclosures. 
Foreign currency translation
Exchange differences arising on foreign currency borrowings, to the extent that they are hedged on the Company’s investment in its 
overseas operation, are reported as movement through the Profit and Loss Reserves.
Non monetary assets, such as the long term loan included in investments, are measured at historical cost and translated using the 
exchange rate at the date of the transaction.
P1. Profit and loss account
As permitted by section 230 of the Companies Act 1985, the Company has elected not to present its own profit and loss account for 
the year. The loss for the year ended 31 March 2009 was (£523,000) (2008: Profit £5,000).
P2. Employees
  2009 2008
The average monthly number of employees, including Executive Directors, was:
Administration  6 7
  £000 £000
Costs in respect of these employees were:
Wages and salaries  598 643
Social security costs  65 77
Other pension costs  59 66
  722 786
P3. Fixed asset investments
  2009 2008
  £000 £000
Cost
At 1 April  29,045 29,045
Additions  2,000 —
At 31 March  31,045 29,045
Provision
At 1 April and 31 March  (777) (777)
Net book value  30,268 28,268
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P3. Fixed asset investments continued
Investments include a long-term loan to Intelek Inc of £10.9 million. The loan is only expected to be repayable if Intelek Inc disposes 
of its investment in Paradise Datacom LLC. The loan bears interest at commercial rates.
The fixed asset addition of £2 million in the year ended 31 March 2009 is a capital contribution to Labtech Limited in order to 
strengthen the subsidiary’s balance sheet.
 P4. Subsidiaries
The principal investments, all of which are wholly owned, are as follows:
 Country of incorporation Activity
Intelek Properties Ltd UK Investment company
Intelek Inc USA Investment company
Paradise Datacom Ltd UK Manufacturer of satellite communications equipment
Paradise Datacom LLC USA Manufacturer of satellite communications equipment
Labtech Ltd UK Manufacturer of microwave communications components
CML Group Ltd UK Manufacturer of aerostructure components
P5. Tangible fixed assets
  Plant and equipment
   £000
Cost at 1 April 2008 and 31 March 2009   80
Depreciation at 1 April 2008   (74)
Charge for the year   (3)
Depreciation at 31 March 2009   (77)
Net book value at 31 March 2009   3
Net book value at 31 March 2008   6
P6. Borrowings
  2009 2008
  £000 £000
Bank overdraft  (1,752) (865)
Bank loans payable within one year  (329) (472)
  (2,081) (1,337)
Bank loans payable:
 in more than one year but not more than two years  — (236)
 in more than two years but not more than five years  (2,308) (1,804)
  (2,308) (2,040)
Further details are included in the Group financial statements, note 31.
P7. Retained earnings
 2009 2008
 Non-   Non-
 distributable Distributable Total distributable Distributable Total
 £000 £000 £000 £000 £000 £000
At 1 April 14,494 13,648 28,142 14,494 14,140 28,634
Loss/(profit) for the year — (523) (523) — 5 5
Dividends — (403) (403) — (355) (355)
Exchange adjustment — (889) (889) — (142) (142)
At 31 March 14,494 11,833 26,227 14,494 13,648 28,142
The non-distributable reserve was established on the sale to a subsidiary of the Company’s investment in another subsidiary at 
perceived market value. The profit arising is not considered distributable as the sale did not give rise to a realised gain for the Group 
as a whole.
P8. Reconciliation of movements in shareholders’ funds
  2009 2008
  £000 £000
At 1 April  32,686 33,119
Disposal of own shares  11 59
Loss/(profit) for the year  (523) 5
Dividends  (403) (355)
Exchange adjustment  (889) (142)
At 31 March  30,882 32,686
Details of the share capital of Intelek plc and of the investment in own shares are disclosed in notes 23, 25 and 26 to the Group’s 
financial statements.
 Notes to the Intelek plc Balance Sheet continued
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61
Notice of Annual General Meeting
 Notice is given that the 2009 Annual General Meeting of the Company will be held at the premises of Intelek plc, South Marston Park, 
Swindon, Wiltshire, SN3 4TR on Friday, 11 September 2009 at 11.30 am. The meeting will be for the following purposes:
Ordinary Business
To consider and, if thought fit, pass the following resolutions as ordinary resolutions:
1 To receive and adopt the Statement of Accounts for the year ended 31 March 2009 together with the Directors’ Report and the 
Auditor’s Report on those accounts.
2 To declare a final dividend for the year ended 31 March 2009 of 0.30 pence per ordinary share in the capital of the Company, to be 
paid on 23 September 2009 to shareholders whose names appear on the register at the close of business on 28 August 2009.
3 To re-elect Mr John Restivo as a Director.
4 To re-elect Mr Kevin Neil Edwards, who retires by rotation, as a Director.
5 To reappoint Grant Thornton UK LLP as auditors to hold office from the conclusion of the meeting until the conclusion of the next 
meeting at which the accounts are laid before the Company.
6 To authorise the Directors to fix the remuneration of the auditors.
Special Business
To consider and, if thought fit, to pass Resolutions 7, 8 and 9 as to which 7 will be proposed and voted on as an Ordinary Resolution, 
and 8 and 9 will be proposed and voted on as Special Resolutions.
7 That the Directors be and are hereby generally and unconditionally authorised pursuant to the provisions of section 80 of the 
Companies Act 1985 (“Act”), to exercise all the powers of the Company to allot relevant securities as defined by section 80 of the 
Act, provided that:
a) the maximum nominal amount of such securities that may be allotted under this authority (within the meaning of section 80 of 
the Act) is £1,131,196; and
b) this authority shall, unless it is (prior to its expiry) duly revoked or is renewed, expire at the conclusion of the Annual General 
Meeting of the Company to be held in 2010 or fifteen months from the date of passing this Resolution (whichever shall occur 
first) save that the Company may, before such expiry, make an offer or agreement which will or may require relevant securities 
to be allotted after such expiry and the Directors of the Company may allot relevant securities in pursuance of such offer or 
agreement as if the power conferred by this Resolution had not yet expired;
and provided also that the authority granted by this Resolution is in substitution for any existing authority to allot relevant securities 
previously granted to the Directors which (to the extent that it remains in force and unexercised) is hereby revoked.
8 That the Company be authorised pursuant to section 166 of the Act to make market purchases (as defined by section 163 of the 
Act) of Ordinary Shares of 5p each in the capital of the Company (“Shares“) on such terms as the Directors of the Company may 
determine, provided that such authority shall be limited as follows:
a) the Company shall purchase not more than 8,737,607 Ordinary Shares (representing 10% of the Company’s issued Ordinary 
Share capital);
b) the price per Ordinary Share (exclusive of dealing and other incidental costs and stamp duty) to be paid by the Company 
shall be:
i) not less than 5p; and
ii) not more than 105% of the average of the middle market quotations for the Shares taken from the Daily Official List of
the London Stock Exchange for each of the five business days immediately preceding the date upon which the purchase
is made;
c) the authority granted by this Resolution shall, unless it is (prior to its expiry) duly revoked, expire at the conclusion of the Annual 
General Meeting to be held in 2010 or fifteen months from the date of passing this Resolution (whichever shall occur first).
However, the Company may purchase its own shares of 5p each after this date provided that any such purchase is made pursuant 
to a contract concluded before the authority expires, under which such purchases will or may be completed or executed wholly 
or partly after such expiry, and provided also that the authority granted by this Resolution is in substitution for any authority to 
purchase its own shares previously granted to the Company which (to the extent that it remains in force and unexercised) is hereby 
revoked.
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62
Notice of Annual General Meeting continued
9 That, subject to and conditional upon the passing of Resolution 7 set out above, the Directors of the Company be and are hereby 
empowered pursuant to Section 95 of the Act to allot equity securities (within the meaning of Section 94 of the Act) for cash 
pursuant to Section 80 of the Act as if Section 89(1) of the Act did not apply to any such allotment, provided that this power shall 
be limited to:
a) the allotment of equity securities in connection with a rights issue in favour of or general offer to Ordinary Shareholders where 
the equity securities respectively attributable to the interests of all the Ordinary Shareholders are proportionate (as nearly 
as may be) to the number of Ordinary Shares held by them (but subject to such exclusions and other arrangements as the 
Directors of the Company may deem necessary or expedient in relation to fractional entitlements and any legal or practical 
difficulties or the requirements of any regulatory body or stock exchange); and
b) the allotment, otherwise than pursuant to subparagraph a) above, of equity securities up to an aggregate nominal value of 
£218,440;
and shall expire at the conclusion of the Annual General Meeting of the Company to be held in 2010 or fifteen months from the 
date of passing this Resolution, whichever shall occur first, save that the Company may before such expiry make an offer or 
agreement which would or may require equity securities to be allotted after such expiry and the Directors of the Company may 
allot equity securities in pursuance of such offer or agreement as if the power conferred hereby had not expired and provided 
also that the authority and power hereby conferred shall be in substitution for any previous authority conferred upon the Directors 
pursuant to the said Section 95 prior to the date of passing this Resolution.
By order of the Board
K N Edwards
Director and Secretary
South Marston Park, Swindon, Wiltshire, SN3 4TR
10 June 2009
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63
 Notes
1 Only those members registered in the register of members of the Company as at 5.00 pm on 9 September 2009 or, in the event 
that the meeting is adjourned, in the register of members 48 hours before the time of any adjourned meeting shall be entitled to 
attend or vote at the meeting in respect of the number of shares registered in their name at that time. Changes to entries in the 
register of members after 5.00 pm on 9 September 2009 or, in the event that the meeting is adjourned, after 48 hours before the 
time of any adjourned meeting shall be disregarded in determining the rights of any person to attend or vote at the meeting.
2 A member is entitled to appoint one or more persons as proxies to exercise all or any of his rights to attend, speak and vote at the 
meeting. A proxy need not be a member of the Company. A member may appoint more than one proxy in relation to the meeting 
provided that each proxy is appointed to exercise the rights attached to a different share or shares held by him. To appoint more 
than one proxy, you will need to complete a separate proxy form in relation to each appointment. You may photocopy the proxy 
form if additional proxy forms are required. You will need to state clearly on each proxy form the number of shares in relation to 
which the proxy is appointed. A failure to specify the number of shares each proxy appointment relates to or specifying a number 
in excess of those held by the member may result in the proxy appointment being invalid. You can only appoint a proxy using the 
procedures set out in these notes and the notes to the proxy form. 
 The appointment of a proxy will not preclude a member from attending and voting in person at the meeting if he or she so wishes.
3 A form of proxy is enclosed. To be valid, it must be completed, signed and sent to the offices of the Company’s registrars, Lloyds 
TSB Registrars, The Causeway, Worthing, West Sussex, BN99 6ZL, so as to arrive no later than 11.30 am on 9 September 2009 
(or, in the event that the meeting is adjourned, no later than 48 hours (excluding any part of a day that is not a working day) before 
the time of any adjourned meeting).
4 In order to facilitate voting by corporate representatives at the meeting, arrangements will be put in place at the meeting so that:
(a) if a corporate shareholder has appointed the chairman of the meeting as its corporate representative with instructions to vote 
on a poll in accordance with the directions of all of the other corporate representatives for that shareholder at the meeting, then 
on a poll those corporate representatives will give voting directions to the chairman and the chairman will vote (or withhold a 
vote) as corporate representative in accordance with those directions; and 
(b) if more than one corporate representative for the same corporate shareholder attends the meeting but the corporate 
shareholder has not appointed the chairman of the meeting as its corporate representative, a designated corporate 
representative will be nominated, from those corporate representatives who attend, who will vote on a poll and the other 
corporate representatives will give voting directions to that designated corporate representative.
Corporate shareholders are referred to the guidance issued by the Institute of Chartered Secretaries and Administrators on proxies 
and corporate representatives (http://www.icsa.org.uk/) for further details of this procedure. The guidance includes a sample form 
of representation letter if the chairman is being appointed as described in (a) above.
5 The following information is available for inspection during normal business hours at the registered office of the Company 
(excluding weekends and public holidays). It will also be available for inspection at the place of the Annual General Meeting from 
9.30 am on the day of the meeting until the conclusion of the meeting:
(a) copies of the service contracts and letters of appointment of the Directors.
6. Biographical details of all those Directors who are offering themselves for re-election at the meeting are set out on page 20 of the 
enclosed annual report and accounts.
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64
Glossary
 Satellite Communications
Amplifier 
A device used to boost the strength of 
an electronic signal. 
Analog 
A form of transmitting information 
characterized by continuously variable 
quantities, as opposed to digital 
transmission, which is characterized 
by discrete bits of information in 
numerical steps. An analog signal is 
responsive to changes in light, sound, 
heat and pressure. 
Aperture 
A cross sectional area of the antenna 
which is exposed to the satellite signal. 
Backhaul 
A terrestrial communications channel 
linking an earth station to a local 
switching network or population centre. 
Bandwidth 
A measure of spectrum (frequency) 
use or capacity. For instance, a voice 
transmission by telephone requires a 
bandwidth of about 3,000 cycles per 
second (3kHz). A TV channel occupies 
a bandwidth of 6 million cycles per 
second (6 MHz) in terrestrial systems. 
In satellite-based systems a larger 
bandwidth of 17.5 to 72 MHz is used to 
spread or “dither” the television signal in 
order to prevent interference. 
Bit 
A single digital unit of information.
Bit Error Rate 
The fraction of a sequence of message 
bits that are in error. A bit error rate of 
10-6 means that there is an average of 
one error per million bits. 
Bit Rate 
The speed of a digital transmission, 
measured in bits per second. 
Block Down Converter 
A device used to convert the 3.7 to 
4.2 kHz signal down to UHF or lower 
frequencies (1 GHz and lower). 
C Band 
This is the band between 4 and 8 GHz 
with the 6 and 4 GHz band being 
used for satellite communications. 
Specifically, the 3.7 to 4.2 GHz satellite 
communication band is used as the 
downlink frequencies in tandem with 
the 5.925 to 6.425 GHz band that serves 
as the uplink. 
Carrier 
The basic radio, television, or telephony 
centre of frequency transmit signal. The 
carrier in an analog signal is modulated 
by manipulating its amplitude (making 
it louder or softer) or its frequency 
(shifting it up or down) in relation to the 
incoming signal. Microwave and satellite 
communications transmitters operate 
in the band from 1 to 14 GHz.
Channel 
A frequency band in which a specific 
broadcast signal is transmitted. 
Television signals require a 6 MHz 
frequency band to carry all the 
necessary picture detail.
DBS 
Direct broadcast satellite. Refers to 
service that uses satellites to broadcast 
multiple channels of television 
programming directly to home mounted 
small-dish antennas. 
Delay 
The time it takes for a signal to go 
from the sending station through the 
satellite to the receiving station. This 
transmission delay for a single hop 
satellite connection is very close to one-
quarter of a second. 
Demodulator 
A satellite receiver circuit which extracts 
or “demodulates” the “wanted” signals 
from the received carrier. 
Digital 
Conversion of information into bits of 
data for transmission through wire, 
fibre-optic cable, satellite, or over 
air techniques. Method allows 
simultaneous transmission of voice, 
data or video. 
Downlink 
The satellite to earth half of a 2-way 
telecommunications satellite link. Often 
used to describe the receive dish end 
of the link. 
Earth Station 
The combination of antenna, amplifiers, 
frequency converters and electronics 
used to transmit/receive a signal 
via satellite. Earth Station antennas 
vary in size from 2 foot to 12 foot (65 
centimetres to 3.7 metres) diameter size 
used for TV reception to as large as 100 
feet (30 metres) in diameter sometimes 
used for international communications. 
Footprint 
A map of the signal strength over 
the earth’s surface. Different satellite 
transponders on the same satellite will 
often have different footprints of the 
signal strength.
Forward Error Correction (FEC) 
Adds unique codes to the digital signal 
at the source so errors can be detected 
and corrected at the receiver. 
Frequency 
The number of times that an alternating 
current goes through its complete cycle 
in one second of time. One cycle per 
second is also referred to as one hertz.
Geostationary 
Refers to a satellite angle with zero 
inclination, so the satellite appears 
to hover over one spot on the earth’s 
equator. For a planet the size and mass 
of the earth, the satellite orbit required is 
22,237 miles above the surface.
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Gigahertz (GHz) 
One billion cycles per second. Signals 
operating above 3 Gigahertz are 
known as microwaves. Above 30 GHz 
they are know as millimetre waves. 
As one moves above the millimetre 
waves signals begin to take on the 
characteristics of Iightwaves. 
Hertz (Hz) 
A measure of frequency. One cycle per 
second.
INMARSAT 
The International Maritime Satellite 
Organization operates a network of 
satellites for international transmissions 
for all types of international mobile 
services including maritime, 
aeronautical, and land mobile. 
INTELSAT 
The International Telecommunications 
Satellite Organization operates a 
network of satellites for international 
transmissions. 
Interference 
Energy which tends to interfere with 
the reception of the desired signals, 
such as fading from airline flights, RF 
interference from adjacent channels, or 
ghosting from reflecting objects such as 
mountains and buildings. 
Ka Band 
The frequency range from 18 to 31 GHz. 
Kbps 
Kilobits per second. Refers to 
transmission speed of 1,000 bits per 
second. 
Kilohertz (kHz) 
Refers to a unit of frequency equal to 
1,000 hertz. 
Klystron 
A microwave tube which uses the 
interaction between an electron beam 
and the RF energy on microwave 
cavities to provide signal amplification. 
The klystron operates on principles of 
velocity modulation very similar to those 
in a TWT except that klystron interaction 
takes place at discrete locations along 
the electron beam. Common types 
of klystrons are the reflex klystron (an 
oscillator having only one cavity), two-
cavity klystron amplifiers and oscillators, 
and multi-cavity klystron amplifiers. 
Ku Band 
The frequency range from 10.9 to 
17 GHz. 
L-Band 
The frequency range from 0.5 to 
1.5 GHz. Also used to refer to the 950 
to 1,450 MHz used for mobile 
communications. 
Low Noise Amplifier (LNA) 
This is the preamplifier between the 
antenna and the earth station receiver. 
For maximum effectiveness, it must 
be located as near to the antenna as 
possible, and is usually attached directly 
to the antenna receive port. The LNA is 
especially designed to contribute the 
least amount of thermal noise to the 
received signal. 
Low Noise Block Downconverter 
(LNB) 
A combination Low Noise Amplifier and 
downconverter built into one device 
attached to the feed. 
Megahertz (MHz) 
Refers to a frequency equal to one 
million hertz, or cycles per second. 
Microwave 
Line-of-sight, point-to-point 
transmission of signals at high 
frequency. Many TV systems receive 
some television signals from a distant 
antenna location with the antenna and 
the system connected by microwave 
relay. Microwaves are also used for 
data, voice, and indeed all types of 
information transmission. 
Microwave Interference 
Interference which occurs when an earth 
station aimed at a distant satellite picks 
up a second, often stronger signal, from 
a local telephone terrestrial microwave 
relay transmitter. Microwave interference 
can also be produced by nearby radar 
transmitters as well as the sun itself. 
Relocating the antenna by only several 
feet will often completely eliminate the 
microwave interference. 
Modem 
Short for modulator/demodulator. A 
communications device that converts 
one form of a signal to another that 
is suitable for transmission over 
communication circuits, typically from 
digital to analog and then from analog 
to digital.
Modulation 
The process of manipulating the 
frequency or amplitude of a carrier in 
relation to an incoming video, voice or 
data signal. 
Modulator 
A device which modulates a carrier. 
Modulators are found as components 
in broadcasting transmitters and in 
satellite transponders. 
Multiplexing 
Techniques that allow a number of 
simultaneous transmissions over a 
single circuit. 
Noise 
Any unwanted and unmodulated energy 
that is always present to some extent 
within any signal. 
Rain Outage 
Loss of signal at Ku or Ka Band 
frequencies due to absorption and 
increased sky-noise temperature caused 
by heavy rainfall. 
Receiver (Rx) 
An electronic device which enables a 
particular satellite signal to be separated 
from all others being received by an 
earth station, and converts the signal 
format into a format for video, voice 
or data. 
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Glossary continued
66
RF
Radio Frequency refers to alternating 
current having characteristics such that 
if the current is input to an antenna, 
an electromagnetic field is generated 
suitable for wireless broadcasting and 
communication. These frequencies 
cover a significant portion of the 
electromagnetic radiation spectrum, 
extending from 9 kilohertz to thousands 
of gigahertz.
Router 
Network layer device that determines 
the optimal path along which network 
traffic should be forwarded. Routers 
forward packets from one network 
to another based on network layer 
information. 
Satellite 
A sophisticated electronic 
communications relay station orbiting 
22,237 miles above the equator moving 
in a fixed orbit at the same speed and 
direction of the earth (about 7,000 mph 
east to west). 
Slot 
That longitudinal position in the 
geosynchronous orbit into which a 
communications satellite is “parked”. 
Communications satellites are typically 
positioned in slots which are based at 
two to three degree intervals. 
SNG 
Satellite news gathering usually with a 
transportable uplink truck. 
Spectrum 
The range of electromagnetic radio 
frequencies used in transmission of 
voice, data and television. 
SSPA 
Solid state power amplifier. A VSLI solid 
state device that is gradually replacing 
Travelling Wave Tubes in satellite 
communications systems because they 
are lighter weight and are more reliable. 
Synchronization (Sync) 
The process of orienting the transmitter 
and receiver circuits in the proper 
manner in order that they can be 
synchronized. 
Transmitter 
An electronic device consisting of 
oscillator, modulator and other circuits 
which produce a radio or television 
electromagnetic wave signal for 
radiation into the atmosphere by an 
antenna. 
Transponder 
A combination receiver, frequency 
converter, and transmitter package, 
physically part of a communications 
satellite. Transponders have a typical 
output of five to ten watts, operate over 
a frequency band with a 36 to 72 
megahertz bandwidth in the L, C, 
Ku, and sometimes Ka Bands or 
in effect typically in the microwave 
spectrum, except for mobile satellite 
communications. Communications 
satellites typically have between 12 and 
24 on board transponders although the 
INTELSAT VI at the extreme end has 50. 
TWT (Travelling wave tube) 
A microwave tube of special design 
using a broadband circuit in which a 
beam of electrons interacts continuously 
with a guided electromagnetic field to 
amplify microwave frequencies. 
TWTA (Travelling wave tube amplifier) 
A combination of a power supply, a 
modulator (for pulsed systems), and a 
travelling wave tube, often packaged in 
a common enclosure. 
Uplink 
The earth station used to transmit 
signals to a satellite. 
VSAT 
Very small aperture terminal. Refers 
to small earth stations, usually in 
the 1.2 to 2.4 metre range. Small 
aperture terminals under 0.5 metre are 
sometimes referred to as Ultra Small 
Aperture Terminals (USATs) 
Waveguide 
A metallic microwave conductor, 
typically rectangular in shape, used to 
carry microwave signals into and out of 
microwave antennas. 
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67
 Microwave Communications
Aesa Radar
Active Electronically Scanned Array 
Radars use many (up to thousands) 
of small Transmit/Receive electronic 
active circuits on a static radar face to 
electronically scan the radar beam.
ATC
Air Traffic Control radar. Identifies 
air traffic approaching and leaving 
commercial and military airfields.
Broadband Amplifiers
Components which amplify microwave 
signals over a broad range of 
frequencies such as Octaves (e.g. 6–12 
GHz) or multi-octaves (e.g. 2–18 GHz). 
Chip
An unpackaged semiconductor device 
or integrated circuit.
Chip & Wire Assembly
Operation of attaching bare 
semiconductor chips to a circuit or 
package and connecting to the chips 
using thin wires.
Clean Room
A manufacturing area with high levels of 
humidity, temperature and dust control.
Digital Radio Link
A pair of subsystems which can transmit 
and receive high frequency digital data. 
Can be used on mobile telecom base 
stations to provide network connectivity.
DLVA
Detector Log Video Amplifier. Detects 
incoming microwave signals giving 
an output voltage which is directly 
proportional to incoming power 
measured in decibels.
ERDLVA
Extended Range DLVA— detects 
incoming microwave signals over 
a very wide input power range 
(e.g. >70 decibels). 
Laser Profiling
Using a Laser to accurately separate 
individual circuits from a multicircuit 
panel.
MIC
Microwave Integrated Circuit. The 
technology of integrating microwave 
chips into a circuit.
Microwave
A general term relating to the frequency 
bands (~1 GHz to 100 GHz) in which a 
product operates.
Microwave Power Amplifiers
Amplify microwave signals from 
relatively low powers (e.g. 0.001 watts) 
to output levels from ~5 to say 2000 
watts. 
MMIC
Monolithic Microwave Integrated Circuit 
— operating in the microwave frequency 
range. These circuits are made out of 
substrate material suitable for operating 
at very high frequencies, e.g. GaAs 
(Gallium Arsenide), and are available as 
chips or chips in packages.
Multilayer
A PCB consisting of more than 2 
dielectric and copper foil layers.
Package
The package of a semiconductor is 
the physical and electrical interface 
between the chip and the system in 
which it operates.
PCB
Printed Circuit Board — used 
extensively in the electronics industry 
to integrate individual components 
and chips.
Phased Array Radar
Usually uses a static antenna face and 
steers the radar beam electronically as 
opposed to more conventional radars 
which physically rotate through 360º.
PIN Switch
An electronic component capable 
of quickly routing high frequency 
microwave signals by using silicon PIN 
Diodes.
Plated Through Holes
Holes drilled through microwave 
dielectric insulating substrates and 
then electro plated to provide electrical 
connection from top conductor layers to 
bottom conductor layers.
PTFE Substrates
Dielectric material used to produce high 
performance microwave circuits. This 
material contains a significant element 
of PTFE (Teflon) to reduce microwave 
signal transmission losses of power.
Thin Dielectric Substrate
Microwave circuit material with a 
dielectric (sandwiched between 2 
copper foil layers) thickness of say 
0.005 inches.
Ultra Broadband Microwave Amplifier 
Gain Modules
Modular building blocks which can 
be cascaded to make a 2–18 GHz 
microwave amplifier or used in a 
microwave sub-system to provide 
distributed gain at various key points.
Wire Bonding
Operation of electrically connecting to 
semiconductor chips using thin wire 
typically 25 microns in diameter.
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Report and Accounts 2009
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Notes
16329INTELEK.indd   68 23/07/2009   13:34 16329 22/07/2009 Proof 6 16329 22/07/2009 Proof 6
Intelek
Report and Accounts 2009
 www .intelek.plc.uk
Stock exchange code: ITK
 Intelek designs and manufactures
electronic systems for satellite 
and microwave communications 
and is a specialist manufacturer 
for the aerospace market.
 Gr oup Highlights 1
Group Overview 2
Chairman’s Statement 4
Chief Executive’s Review 6
Financial Review 18
Directors and Senior Executives  20
Directors’ Report 21
Statement of Directors’ Responsibilities 24
Corporate Governance Report 25
Remuneration Report 29
Auditor’s Report  32
Consolidated Income Statement 33
Consolidated Statement 
of Recognised Income and Expense 33
Consolidated Balance Sheet 34
Consolidated Cash Flow Statement 35
Notes to the Financial Statements 36
Five Year Summary 57
Company Balance Sheet 58
Notice of Annual General Meeting 61
Glossary 64
Group Company Addresses and Advisers IBC
 Introduction to the markets
and operations of the Group
 Strategy and prospects
Divisional analysis;
achievements and aims
 Glossary of technical terms
Welcome to Intelek plc
Registered Office
Intelek plc
PO Box 25, South Marston Park, 
Swindon, Wiltshire, SN3 4TR
Tel: (01793) 827000
Fax: (01793) 827578
e-mail: info@intelek.plc.uk
Website: www.intelek.plc.uk
CML Group Limited
Price Street, Birkenhead, 
Wirral, CH41 3PT
Tel: (0151) 647 5531
Fax: (0151) 650 0668
e-mail: enquiries@cml-group.com
Website: www.cml-group.com
Auditors
Grant Thornton UK LLP
Chartered Accountants
Enterprise House, 115 Edmund Street,
Birmingham, B3 2HJ
Solicitors
DLA
Victoria Square House,
Victoria Square, Birmingham, B2 4DL
Labtech Limited*
Unit 1, Broadaxe Business Park, 
Presteigne, Powys, LD8 2UH
Tel: (01544) 260093
Fax: (01544) 260310
8 Vincent Avenue, 
Crownhill, Milton Keynes, MK8 0AB
Tel: (01908) 261755
Fax: (01908) 261788
e-mail: sales@labtech.ltd.uk
Website: www.labtechcircuits.com
* Held directly by Intelek plc.
Bankers
Barclays Bank PLC 
Park House, Stoke Gifford, 
Bristol, BS34 8TN
Sovereign Bank 
2790 West College Avenue, Suite 800, 
State College, PA 16801, USA
Paradise Datacom
Paradise Datacom Ltd*
1 Wheaton Road, Witham,
Essex, CM8 3UJ
Tel: (01376) 515636
Fax: (01376) 533762
e-mail: sales@paradise.co.uk
Paradise Datacom LLC
328 Innovation Boulevard,
Suite 100, State College, 
PA 16803, USA
Tel: (001) 814 238 3450
Fax: (001) 814 238 3814
e-mail: sales@paradisedata.com
Website: www.paradisedata.com
Stockbrokers/Nomads
Altium Capital Limited
30 St James’s Square,
London, SW1Y 4AL
Registrars 
and Transfer Office 
Equiniti Limited
The Causeway, Worthing, 
West Sussex, BN99 6DA
Trading Subsidiaries
Advisers
Group Company Addresses
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INTELEK plc
Annual Report 
and Accounts
 for the year ended 31 March 2009
Intelek
Report and Accounts 2009
 INTELEK plc Report and Accounts for the year ended 31 March 2009
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