9 1
Contents
Page
Directors, Secretary and Advisors 2
Financial Highlights 3
Chairman’s Overview 4
Chief Executive Officer’s Operating Review 5
Report of the Chief Financial Officer 7
Five Year Review 9
Directors 10
Report of the Directors 11
Corporate Governance Report 20
Corporate Social Responsibility Report 23
Directors’ Remuneration Report 24
Report of the Independent Auditor on the Consolidated Financial Statements 31
Consolidated Income Statement 33
Consolidated Balance Sheet 34
Consolidated Cash Flow Statement 35
Consolidated Statement of Recognised Income and Expense 36
Notes to the Financial Statements 37
Report of the Independent Auditor - Company 61
Company Balance Sheet 63
Notes to the Company’s Financial Statements 64
Notice of Annual General Meeting 68
Financial Calendar 71
Useful Information Sources for Shareholders 72 2
Company registration number: 2330913
Directors, Secretary and Advisors
Principal business address:
No. 1 Croydon
12-16 Addiscombe Road
Croydon
Surrey CR0 0XT
Registered office:
Bensham House
324 Bensham Lane
Thornton Heath
Surrey CR7 7EQ
Directors:
Dr. Keith Hellawell QPM
Rakesh V Patel
Ajay M Patel
Ram Swamy
Nick Woollacott
Paul Edwards MBE
Secretary:
S Venkateswaran
Principal bankers:
The Royal Bank of Scotland plc
280 Bishopsgate
London EC2M 4RB
Solicitors:
Jones Day
Solicitors
21 Tudor Street
London EC4Y 0DJ
Cripps Harries Hall LLP
Wallside House
12 Mount Ephraim Road
Tunbridge Wells
Kent TN1 1EG
Auditor:
Grant Thornton UK LLP
Registered Auditors
Chartered Accountants
Grant Thornton House
Melton Street
Euston Square
London NW1 2EP
Brokers:
Panmure Gordon & Co Limited
155 Moorgate
London EC2M 6XB
Numis Securities Limited
The London Stock Exchange Building
10 Paternoster Square
London EC4M 7LT
Registrars:
Capita Registrars
Northern House
Woodsome Park
Fenay Bridge
Huddersfield HD8 0GA 3
2009 2008
£’000 £’000
Trading results
Revenue 98,397 84,934
Proﬁt before tax 21,329 12,395
Proﬁt after tax 13,882 6,253
Proﬁt before tax is stated after charging/(crediting) the following items:
Research and development expenditure 672 275
Amortisation costs 4,299 4,300
Impairment losses 749 483
Professional costs in connection with Serious Fraud Ofﬁce investigation and
Department of Health claims (2,100) 328
Balance sheet
Non-current assets 20,311 22,537
Current assets 56,249 43,636
Total assets 76,560 66,173
Non-current liabilities 1,116 805
Current liabilities 23,477 25,998
Total liabilities 24,593 26,803
Equity 51,967 39,370
Total equity and liabilities 76,560 66,173
Shareholder returns
Earnings per share
Basic (pence) 39.7 16.9
Diluted (pence) 39.7 16.9
Dividends
Proposed dividend per share (pence) 5.8 5.5
Dividends paid during the year (pence) 8.4 7.6
Financial Highlights On 3 December 2008, the Court of Appeal ﬁnally put an end to the Serious Fraud Ofﬁce’s endeavour
to prosecute the Company. Despite the outcome being positive the persistence and length of the
litigation, over six years, have caused damage to the reputation of the Group. It is a credit to the
management that through this turbulent time the business has delivered strong growth, proﬁts and
cash ﬂows. The Board is committed to continue to build its market position by providing quality
service and products, and focusing on strengthening mutually beneﬁcial business partnerships with
the Company’s stakeholders.
Our refocus on the Pharmaceuticals and Consumer Health product businesses has delivered
encouraging results. During the year, senior managers have devoted a signiﬁcant amount of time to
restructure the business and upgrade its systems and processes for future growth. The systems
upgrade with a majority of SAP systems and processes implementation is due for completion by the
end of this calendar year.
The pharmaceutical side of our business continues to provide good margins and we are actively
pursuing the introduction of new products to ensure that this continues. Our Consumer Health
business remains “work in progress” and is undergoing strategic changes. There are encouraging
positive signs from the sale of our branded weight management products.
We also have developed strategies to increase our market share in the territories we cover outside
the UK and bring new quality products to the consumer in a more cost effective and efﬁcient way.
I hope to report positive progress during the course of the current ﬁnancial year.
We are in a very sound ﬁnancial position with substantial cash balance of £27.5 million and no
debt. We intend to spend our cash reserves on new product introductions, creating brands in the
future and paying dividends.
The Group has strengthened its corporate governance by having a strong non-executive Director
presence on the Board and a newly appointed CFO, Ram Swamy. We are fully committed to continue
to improve our corporate governance platform; for example, this year we launched our risk
management assessment program across the Group.
I am pleased to inform you that Kirti V. Patel has agreed to rejoin the Board as Group Executive
Director in August 2009. Kirti has been closely associated with the Company from its inception,
most recently as strategic advisor. I am conﬁdent Kirti’s undoubted knowledge and standing within
the pharmaceutical industry will add much value to our future success.
After a successful last ﬁnancial year, we have had an encouraging start to the current ﬁnancial year
but we expect to face a more challenging economic environment in the short-term future. I am
conﬁdent that Goldshield is a Group which can grow further, with the support of its dedicated
employees.
Dr. Keith Hellawell QPM
Chairman
24 June 2009
4
Chairman’s Overview 5
I am pleased to report another encouraging performance across the Group for the year ended 31
March 2009. Our efforts to concentrate on the core Pharmaceuticals and Consumer Health
businesses have proved successful and have delivered Group revenues of £98.4 million, an increase
of 15.9% over 2008 (£84.9million) or 12.2% at constant exchange rates. Our proﬁt before tax and
exceptionals was £20.0 million (2008: £13.2 million), excluding a credit of £2.1 million in relation
to litigation costs (2008: charge of £0.3 million) and a £0.7 million non-cash impairment charge
(2008: £0.7 million). Earnings per share were 39.7 pence (2008: 16.9 pence). During the year,
the Group generated cash of £12.9 million from operating activities (2008: £4.8 million), and we
ﬁnished the year with £27.5 million of cash (2008: £19.2 million). I am delighted to report that
we have proposed to increase the ﬁnal dividend to 5.8 pence, which brings the total dividend to 8.7
pence (2008: 8.0 pence), an increase of 8.8%.
Our pharmaceuticals product portfolio has performed well with sales of £73.8 million (2008: £63.8
million) and operating proﬁt of £23.8 million (2008: £14.0 million) beneﬁting from a combination
of favourable product mix and operational efﬁciencies. Despite this encouraging performance, the
Pharmaceuticals business is facing increasing regulatory costs and pricing pressure on its branded
pharmaceuticals products sold to the NHS due to the Pharmaceutical Price Regulation Scheme. This
has a 3.9% price reduction effective as of February 2009 and further 1.9% price reduction as of
January 2010.
Sales from the Consumer Health business are up to £23.5 million (2008: £19.2 million) reﬂecting,
in particular, a strong performance by our two leading weight management products: Lipobind and
Appesat. However, the Consumer Health business incurred an operating loss of £4.7 million (2008:
loss of £1.6 million) due to a challenging market environment and increased investment in brand
building. The product lines have been rationalised, a number of non-core product areas have been
closed and the division has been restructured, resulting in non-recurring costs last year in the region
of £1 million. While we believe that this division has good long term prospects, especially in weight
management and joints & mobility, further work is required to build a sustainable business and we
expect the division to continue to be loss-making in the current ﬁnancial year.
Our decision to restructure our US business by strengthening the direct sales has shown encouraging
performance. It is our intention to operate in our core markets - Europe and North America - and
invest in new products and our marketing capabilities.
During the year we have made major efforts to improve efﬁciency with a rationalisation of our
product base and a review and reorganisation of processes to strengthen our operational platform.
In line with this, we are implementing SAP business management systems. I expect the majority of
systems and processes integration to be complete by the end of the calendar year.
We have made signiﬁcant progress in strengthening our senior management in the areas of quality,
regulatory, technical and medical affairs which will greatly assist us in supporting and growing our
product-focused business. As already mentioned in the Chairman’s report I am pleased to welcome
Kirti Patel back to the Group Board. He will be a valuable addition to the Group.
A detailed business review is provided on pages 11 to 13 in the Report of the Directors.
This is an exciting period for the Group. We remain committed to the development of lifestyle
consumer health brands and the introduction of new pharmaceutical products. Our strong balance
sheet allows us to be conﬁdent of weathering the economic downturn and our cash ﬂow and cash
reserves facilitate our commitment to grow the business. We intend to use our resources to invest
Chief Executive Officer’s Operating Review 6
in new product introductions via development, in-licensing and acquisitions together with building
brands. Long term sustainable growth is an area that is at the forefront of our objectives and I am
conﬁdent we can maximise value for our shareholders.
The past year has been one of a major change for the Group and I would like to extend my gratitude
to the entire staff at Goldshield for their hard work and commitment.
Rakesh Patel
Chief Executive Officer
24 June 2009
Chief Executive Officer’s Operating Review
(continued) 7
Revenue
The revenue for the year grew by 15.9% to £98.4 million (2008: £84.9 million).
Revenues in the UK and Western Europe have increased to £89.8 million (2008: £77.6 million)
primarily due to increase in sales by all the units of Pharmaceutical division and through the Retail
distribution channel of Consumer Health division.
Revenues in North America grew by 29.4% to £6.6 million (2008: £5.1 million) due to an upswing
in the Canadian business, growth of active customers and favourable currency translations.
Gross proﬁt
The Group’s gross proﬁt for the year was £68.2 million (2008: £57.5 million). The gross margin
achieved was 69.3% (2008: 67.7%).
Earnings and operating results
The Group Earnings before Tax, Amortisation, Impairment and Exceptional costs (EBTA) were £24.2
million (2008: £17.5 million) a growth of 38.3%. The reconciliation to the Group’s operating proﬁt
is given below:
2009 2008
£’million £’million
Operating profit 20.2 11.2
Amortisation 4.3 4.3
Impairment losses 0.7 0.5
Exceptional legal and professional costs (2.1) 0.3
Finance income 1.1 1.2
EBTA 24.2 17.5
The Group operating proﬁt was £20.2 million (2008: £11.2 million) representing a margin of
20.5% (2008: 13.2%). The operating proﬁt is stated after:
• Exceptional legal and professional costs in connection with the Serious Fraud Ofﬁce and
Department of Health litigation, credit of £2.1 million (2008: charge of £0.3 million).
• Impairment in relation to the goodwill of the Regina Health Limited business and property, plant
and equipment of the Well Being Centre at Ahmedabad and Consumer Health Direct business in
India amounting to £0.7 million (2008: £0.5 million).
Research and development expenditure
Research and development expenditure incurred and written off directly to the income statement
was £0.7 million (2008: £0.3 million). As at 31 March 2009 the Group does not have any capitalised
development expenditure (2008: £nil).
Taxation
The taxation charge of £7.4 million (2008: £6.1 million) represents an effective tax rate 34.9%
(2008: 49.6%). The tax charge is higher than the standard rate principally as a result of tax
disallowance on amortisation, impairment, other expenses and the tax losses of some of our
overseas business which are not available to be offset against proﬁts elsewhere in the Group.
The deferred tax credit included in the tax charge was £0.4 million (2008: Deferred tax charge of
£0.2 million). The deferred tax credit is due to the temporary difference on account of amortisation
of intangible assets.
Report of the Chief Financial Officer Earnings and dividends
Basic earnings per share is 39.7 pence (2008: 16.9 pence) and the diluted earnings per share is
39.7 pence (2008: earnings of 16.9 pence).
The Directors propose a dividend of 5.8 pence per share (2008: 5.5 pence).
The dividend paid during the year was 8.4 pence (2008: 7.6 pence). The proposed dividend will
be subject to approval at the Annual General Meeting, to be held on 5 August 2009, and is expected
to be paid on 19 August 2009 to Ordinary Shareholders on the register at the close of business on
24 July 2009.
Cash ﬂow and liquidity
During the year the Group generated £12.9 million from operating activities (2008: £4.8 million).
The primary use of the operating cash was to meet increased working capital needs of the business
and payment of corporation tax and dividends to shareholders. The Group has not bought back any
shares during the year (In 2008 it used £4.67 million to buy back 1,650,000 shares which have
subsequently been held as Treasury Shares). In addition, the Group has expended £1.4 million on
property, plant and equipment (2008: £1.2 million) and an amount of £1.0 million towards
purchase and implementation of Enterprise Resource Planning (ERP) software costs. The Group also
funded the Employee Beneﬁt Trust (EBT) for the purchase of shares to be used for the Group’s
Long-Term Incentive Plan (LTIP) amounting to £0.8 million (2008: £1.9 million).
The Group ended the year with a cash balance of £27.5 million (2008: £19.2 million). The Group
deployed its cash surpluses in money market instruments, earning interest income for the year. The
average rate of interest earned on short term deposits during the year was 5.7% (2008: 6.8%).
Ram Swamy
Chief Financial Ofﬁcer
24 June 2009
8
Report of the Chief Financial Officer
(continued) 9
2009 2008 2007 2006 2005
£’000 £’000 £’000 £’000 £’000
Trading results
Revenue 98,397 84,934 74,274 80,025 80,767
Operating profit/(loss) 20,237 11,164 (98) 6,532 4,821
Profit before tax 21,329 12,395 603 6,807 4,503
Profit/(loss) after tax 13,882 6,253 (1,763) 3,880 471
Balance sheet
Non-current assets 20,311 22,537 26,411 32,321 40,056
Current assets 56,249 43,636 43,785 38,065 29,385
Total assets 76,560 66,173 70,196 70,386 69,441
Non-current liabilities 1,116 805 1,117 1,649 2,639
Current liabilities 23,477 25,998 28,397 23,265 23,513
Total liabilities 24,593 26,803 29,514 24,914 26,152
Net current assets 32,772 17,638 15,388 14,800 5,872
Cash and cash equivalents 27,462 19,197 23,321 15,855 6,168
Equity 51,967 39,370 40,682 45,472 43,289
Shareholder returns
Earnings/(loss) per share
Basic (pence) 39.7 16.9 (4.7) 10.5 1.3
Diluted (pence) 39.7 16.9 (4.7) 10.4 1.3
Dividends
Proposed dividend per share (pence) 5.8 5.5 5.1 5.1 4.5
Dividends paid during the year (pence) 8.4 7.6 6.8 6.2 4.0
Employee numbers
Average number of employees in the year 910 930 922 870 831
Five Year Review 10
The Directors of the Company, none of whom are related to each other, are:
DR. KEITH HELLAWELL QPM, LLB, MSc, LLD, non-executive Chairman, joined the board on 15
May 2006. He has over 40 years experience in the public sector being a former Chief Constable of
two British police forces. Between 1998 and 2002, working directly to the Prime Minister, he co-
ordinated and delivered the United Kingdom national and international anti-drugs policy. During this
time he also advised a number of other Governments and international bodies on drugs policies. In
addition he has over nine years experience in private sector management serving as a non-executive
Chairman or Director of a number of diverse companies including: 1998/99 Evans of Leeds Limited
(property), 2003/06 Dalkia plc (energy) and 2004/06 Sterience Limited (sterilisation plants) both
subsidiaries of the French company Veolia Env. He is an executive consultant to a Swedish H.R. group
and runs his own small communications company.
RAKESH V PATEL BA (Hons), FCCA, Chief Executive Ofﬁcer, joined Goldshield in 1992 and was
appointed as Finance Director in 1998. He managed core operational functions as well as business
units within the Group and became CEO in July 2007.
AJAY M PATEL BA (Hons) MIDM, DipCIM, DipMRS, Group Executive Director, joined Goldshield in
1993. From 1993 to 1998, he was responsible for the Group’s European Healthcare business,
predominantly Direct to Consumer and retail Over The Counter in the UK. In 1998 he became Marketing
Director and is now responsible for the Group’s global Consumer Health division.
RAM SWAMY, Chief Financial Ofﬁcer, joined Goldshield on 6 August 2008. He has a Masters Degree
in Commerce (Advanced Cost Management), is a Certiﬁed Public Accountant from the US, Chartered
Accountant and Cost & Works Accountant from India, and holds certiﬁcation in Corporate and Industrial
Legislation (Company Secretary from India). He has over 19 years’ experience in the pharmaceutical,
healthcare, marketing and ﬁnance sectors and was previously employed at Iron Mountain (USA) as
Chief Financial Ofﬁcer of its medical record management business. Ram Swamy is responsible for the
Group’s Shared Services including Finance, Information Technology and Management Information
Systems.
NICK WOOLLACOTT BSc (Hons) Physics, Companion IGEM, non-executive Director, is a former
FTSE 100 Executive Director who has spent most of his career on the commercial side of the energy
sector, primarily in international oil, gas and electricity. He has sat on many boards both nationally and
internationally and has wide experience of developing, acquiring or disposing of businesses in the UK
and overseas. He has also had direct responsibility for running a workforce of over 15,000 people.
More recently he was Senior Independent Director of Enterprise plc, the North-West based support
services business, being involved in its move from the AIM market to a full listing and then, later,
overseeing its move back into private-equity supported private ownership. He is a board member of
Cyril Sweett Group plc, an AIM listed construction and project management business. At Goldshield
he chairs the Audit Committee.
PAUL EDWARDS MBE, non-executive Director, has over 20 years of international management
experience gained in the pharmaceutical and biotechnology sectors. Currently he is the Chief
Executive of Ruston Poole International Limited, one of Europe’s leading specialist executive search
ﬁrms within the healthcare sector. In recognition of his work, he received the MBE in 1997 for his
services in the biotechnology industry. At Goldshield he chairs the Remuneration Committee.
Directors 11
Report of the Directors
The Directors present their report for Goldshield Group plc for the year ended 31 March 2009.
Principal activities
The quoted Company is a parent undertaking and did not trade with third parties during the year.
The Group is engaged in the development, marketing and distribution of pharmaceutical and
consumer health products.
Results and dividends
The trading results for the year and the Group’s ﬁnancial position at the end of the year are shown
in the attached ﬁnancial statements and are discussed further in the business review below.
The Company has paid the following dividends during the year: 2009 2008
£’000 £’000
Dividends paid on ordinary shares (5.5 pence per share on 20 August
2008 and 2.9 pence per share on 8 January 2009/ 5.1 pence per share
on 20 August 2007 and 2.5 pence per share on 10 January 2008) 2,948 2,817
In addition, a dividend of 5.8 pence (2008: 5.5 pence) on the ordinary shares has been proposed
after the end of the ﬁnancial year. The proposed dividend is expected to be paid on 19 August 2009
to those members on the register at the close of business on 24 July 2009.
Business review
Financial overview
Revenue for the year ended 31 March 2009 was £98.4 million - a rise of 15.9% on last year (2008:
£84.9million). Proﬁt before tax was £21.3 million (2008: £12.4 million).
The Directors are pleased with the Group’s performance during the year. A more detailed analysis of
the ﬁnancial performance and position of the business are provided below.
Key performance indicators
The Directors have overseen the progress of the overall Group strategy and its individual strategic
elements closely by the reference to certain ﬁnancial and non-ﬁnancial key performance indicators
which are analysed below. These key performance indicators are discussed in the divisional review
in the Report of the Directors.
2009 2008 Change
£ million £ million £ million %
Revenue 98.4 84.9 13.5 15.9
Gross proﬁt 68.2 57.5 10.7 18.6
Proﬁt before tax, impairment
and exceptional items 20.0 13.2 6.8 51.5
2009 2008
Number Number
Average number of employees 910 930 12
Earnings and operating results
The Group Earnings before Tax, Amortisation, Impairment and Exceptional costs (EBTA) were £24.2
million (2008: £17.5 million). The reconciliation to the Group’s operating proﬁt is given below:
2009 2008
£’million £’million
Operating profit 20.2 11.2
Amortisation 4.3 4.3
Impairment losses 0.7 0.5
Exceptional legal and professional costs (2.1) 0.3
Finance income 1.1 1.2
EBTA 24.2 17.5
The Group operating proﬁt was £20.2 million (2008: £11.2 million) representing a margin of
20.5% (2008: 13.2%). The operating proﬁt is stated after:
• Exceptional legal and professional costs in connection with the Serious Fraud Ofﬁce and
Department of Health litigation, credit of £2.1 million (2008: charge of £0.3 million).
• Impairment in relation to the goodwill of the Regina Health Limited business and property, plant
and equipment of the Well Being Centre at Ahmedabad and Consumer Health Direct business in
India amounting to £0.7 million (2008: £0.5 million).
Research and development expenditure
Research and development expenditure incurred and written off directly to the income statement
was £0.7 million (2008: £0.3 million). As at 31 March 2009 the Group does not have any
capitalised development expenditure (2008: £nil).
Taxation
The taxation charge of £7.4 million (2008: £6.1 million) represents an effective tax rate 34.9%
(2008: 49.6%). The tax charge is higher than the standard rate principally as a result of tax
disallowance on amortisation, impairment, other expenses and the tax losses of some of our
overseas businesses which are not available to be offset against proﬁts elsewhere in the Group.
The deferred tax credit included in the tax charge was £0.4 million (2008: Deferred tax charge of
£0.2 million). The deferred tax credit is due to the temporary difference on account of amortisation
of intangible assets.
Cash ﬂow and liquidity
During the year the Group generated £12.9 million from operating activities (2008: £4.8 million).
The primary use of the operating cash was to meet increased working capital needs of the business
and payment of corporation tax and dividends to shareholders. The Group has not bought back any
shares during the year (In 2008 it used £4.67 million to buy back 1,650,000 shares which have
subsequently been held as Treasury Shares). In addition, the Group has expended £1.4 million on
property, plant and equipment (2008: £1.2 million) and an amount of £1.0 million towards
purchase and implementation of Enterprise Resource Planning (ERP) software costs. The Group also
funded the Employee Beneﬁt Trust (EBT) for the purchase of shares to be used for the Group’s
Long-Term Incentive Plan (LTIP) amounting to £0.8 million (2008: £1.9 million).
The Group ended the year with a cash balance of £27.5 million (2008: £19.2 million). The Group
deployed its cash surpluses in money market instruments, earning interest income for the year. The
average rate of interest earned on short term deposits during the year was 5.7% (2008: 6.8%).
Report of the Directors
(continued) 13
Pharmaceuticals division
The Pharmaceuticals division achieved total sales of £73.8 million (2008: £63.8 million)
representing 15.7% growth. The operating proﬁt was £23.8 million (2008: £14.0 million), an
increase of 70.0%. The business beneﬁted from product portfolio mix and efﬁcient operational
platform across the Group.
Our European retail brand business achieved sales of £43.0 million (2008: £36.6 million), an
increase of 17.5% in sales. The increase is attributable to improvements in our service levels and
growth in our pain and anti-infective products portfolios well above our expectations. However,
increasing pressure across Europe by authorities to reduce the reimbursement cost of medicines has
impacted our growth.
Our Hospitals business in Europe recorded sales of £13.3 million (2008: £12.6 million), an
increase of 5.6% in sales. Synopsis, our osteoarthritis pain management product, was launched in
March 2009. Business increased by winning more contract lines on the national tenders in England,
Wales and Northern Ireland.
Retail generics achieved sales of £11.5 million (2008: £9.3 million), an increase of 23.6%.
The business has beneﬁted from product rationalisation initiatives and better operational efﬁciencies.
Country distributors’ business achieved sales of £5.9 million (2008: £5.3 million), an increase of
11.3% delivered by better sales of existing products into our existing markets.
Consumer Health division
The Consumer Health division recorded sales of £23.5 million (2008: £19.2 million) representing
an increase of 22.4% over the previous year. The increase is mainly attributed to increased sales of
our branded products via retail channel. However, the business incurred losses of £4.7 million due
to challenging market conditions and extensive investment in brand building (2008: loss of
£1.6 million). In addition, during the year we have discontinued our Consumer Health Direct
business in India and closed our last Wellbeing clinic in Ahmedabad in line with our product-focused
long term strategy. Our primary focus in the future remains to grow our European and North-
American businesses.
Brand building efforts were focused on two top selling brands in the Weight Management category:
Appesat was introduced in 2009 while maintaining the growth of Lipobind. We are committed to
develop and launch new branded products in the lifestyle consumer health segments, particularly in
weight management and joints & mobility.
European Direct to Consumer business achieved sales of £11.6 million (2008: £11.1 million), an
increase of 4.5% beneﬁting from extended distribution network via direct to consumer and the web.
Consumer Health Retail Europe achieved sales of £4.7 million (2008: £2.7 million), an increase of
74.0%. The year witnessed establishing new partnerships with a wider range of national accounts
and retailers, and completion of product rationalisation.
North America business achieved sales of £6.6 million (2008: £5.1 million), an increase of 29.4%.
The improvement is attributable to the change in the management structure, focus on the Direct
Sales in the operating business model and positive impact of currency translation.
Future outlook and strategy
Our strategy to move back to the Group’s core strengths of marketing pharmaceutical products and
developing lifestyle consumer health brands has delivered good results. Supporting restructuring
of the business divisions is carried out with focus on product portfolio mix, efﬁcient processes
and systems, and long term growth and proﬁtability. Our SAP (Enterprise Resource Planning)
implementation program remains on schedule. We anticipate that the majority of systems and
processes integration will be completed by this calendar year. We are committed to continue to
invest in product development, marketing and brand building across the Group.
Report of the Directors
(continued) 14
Principal risks and uncertainties
The management of the business and the nature of Group’s strategy are subject to a number of risks.
Capacity constraints of suppliers of key products
The planned sales growth of some of our key pharmaceutical products may be impacted due to
capacity constraints of our suppliers, the availability of Active Pharmaceutical Ingredients and receipt
of timely approvals of Marketing Authorisations. The senior management is working on initiatives to
mitigate these risks in order to deliver the forecasted sales growth.
Foreign exchange risk
The Group operates internationally and is exposed to foreign exchange risks arising from various
currency exposures, primarily with respect to the US dollar and EURO. Wherever relevant, the
agreements with suppliers provide for remedy due to variation in exchange rates beyond a threshold
limit.
Economic downturn
The success of the Consumer Health business is reliant on consumer spending. The current
economic downturn, resulting in a reduction of consumer spending power, will have an impact on
the sales achieved by the Group.
The Group keeps abreast of economic conditions; marketing and pricing strategies will be modiﬁed
to reﬂect the changes in market conditions.
High proportion of ﬁxed overheads and variable revenues
A large proportion of the Group’s overheads are ﬁxed. There is the risk that any signiﬁcant changes
in revenue may lead to the inability to cover such costs.
Senior management closely monitors ﬁxed overheads against budget on a monthly basis and cost
saving exercises is implemented when there is an anticipated decline in revenues.
Competition
The market in which the Group operates is highly competitive. As a result there is a constant
downward pressure on margins and the additional risk of being unable to meet customers’
expectations. Policies of constant price monitoring, ongoing market research and customer
relationship management frameworks are in place to mitigate such risks.
Pharmaceutical Price Regulation Scheme (PPRS)
PPRS changes have resulted in a 3.9% price reduction effective as of February 2009 and a further
1.9% price reduction as of January 2010.
Capital risk management
The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a
going concern in order to provide returns for shareholders and beneﬁts for stakeholders. Consistent
with others in the industry and of its size, the Group believes that an optimum capital structure is
currently achieved entirely through equity and with no net debt. Total equity at 31 March 2009 was
£52.0 million (2008: £39.4 million).
In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends
paid to shareholders, issue new shares or raise future funds through debt.
The capital structure of the Company, and the rights and obligations attaching to shares in the
Company, are detailed in note 12 to the ﬁnancial statements.
Essential contracts
The Group’s performance is largely reliant on sourcing high quality products at the lowest possible
prices. Whilst price is important, the Directors do not believe that lowering price is an acceptable
alternative to producing quality products. The Group has beneﬁted from a number of contracts with
suppliers which have proved essential in enabling the Group to deliver quality products at the lowest
possible price.
Report of the Directors
(continued) 15
In addition the Group has a number of members of staff who, due to their knowledge of the Group
and its intellectual property, are essential to the continued smooth running of the business. The Group
reviews its employment policies at regular intervals, including a review of its performance-related pay
policies, so as to ensure these members of staff continue to remain incentivised and their goals remain
congruent with those of the Group. All employment contracts contain non-compete agreements. All
employment contracts also stipulate that all intellectual property remains that of the Group.
Directors
The details of Directors who served during the year are set out below.
The beneﬁcial interests of the Directors and their families in the shares of the Company at 1 April
2008, or their date of appointment if later, and 31 March 2009, as recorded in the register
maintained by the Company, were as follows:
5p Ordinary shares
31 March 2009 1 April 2008
Executive Directors or date of appointment
Rakesh V Patel 655,804 655,804
Ajay M Patel 495,000 495,000
Ram Swamy (w.e.f. 6 August 2008) ––
Non-executive Directors
Dr. Keith Hellawell QPM ––
Nick Woollacott ––
Paul Edwards MBE ––
As at 24 June 2009 there had been no change in Directors’ shareholdings since 31 March 2009.
Details of Directors’ share options and awards are set out in the Remuneration Report on page 29.
Rakesh V Patel and Ajay M Patel retire by rotation, and being eligible, offers themselves for re-election
at the Company’s forthcoming Annual General Meeting.
Ram Swamy who was appointed as a director on 6 August 2008 retires and being eligible, offers
himself for re-election at the Company’s forthcoming Annual General Meeting.
Group employees
The Group’s employees are fundamental to the future success of the business. Regular training
programmes are offered to new recruits and existing members of staff. Annual staff satisfaction
surveys are undertaken to ensure that the training programs and other staff initiatives meet the
needs of staff.
To ensure the aspirations of employees are congruent with the objectives of the Group, all employees
are incentivised based on performance. The success of the Group is dependent upon the quality and
performance of its employees and the Group continues to ensure this through continuous training
and development, facilitated by Investors in People. The Group has also enhanced its performance
evaluation process supported by SAP .
Information about the Group’s activities is regularly communicated to all employees through an
internal web-site called the ‘Grapevine’.
It is the policy of the Group to give full and fair consideration of the employment of disabled persons
in jobs suited to their individual circumstances and, as appropriate, to consider them for recruitment
opportunities, career development and training where possible, arrangements are made for the
continuing employment of employees who become disabled whilst in Group’s employment.
Report of the Directors
(continued) 16
Report of the Directors
(continued)
Employee sharesave scheme
An employee sharesave scheme is open to all eligible employees. Under the terms of the scheme
the Directors may offer options to purchase ordinary shares in the Company to employees who enter
into an HM Revenue & Customs approved sharesave contract. The price of each share option is at
a discount of 20% from the market price at the date of granting the options. Options may normally
be exercised during the period of six months after the completion of the sharesave contract.
Share options
During the year no new share options were granted to employees. Details of the options granted to
date are set out in note 12 to the ﬁnancial statements.
Long-Term Incentive Plan (LTIP)
The Company has also introduced a LTIP to select senior management personnel (including the
executive Directors). The awards under the LTIP are based on performance targets to be achieved
in terms of Earnings Per Share and Total Shareholders Return.
Details of the Directors’ Share Options and LTIP awards are shown in the Directors’ Remuneration
Report on page 29.
Charitable and political donations
Donations to charitable organisations amounted to £61,000 (2008: £nil).
Donations to political organisations amounted to £nil (2008: £nil).
Substantial shareholders
Director shareholdings
Director name Amount % Holding
Rakesh V Patel 655,804 1.8%
Ajay M Patel 495,000 1.3%
As at 13 May 2009 the Company has been advised of the following holdings, in addition to those
of the Directors disclosed above, of 3% or more of the nominal value of the Company’s shares:
Name Shareholding %
Schroder Investment Management Limited 10,797,297 29.4%
Halifax Share Dealing Services 1,811,011 4.9%
Ajit R Patel 1,750,000 4.8%
Kirti V Patel 1,558,868 4.2%
Legal & General Investment Management Limited 1,536,785 4.2%
Gartmore Investment Management 1,394,403 3.8%
Payment policy and practice
It is the Group’s policy to settle the terms of payment with suppliers when agreeing the terms of the
transaction to ensure that suppliers are aware of these terms. In general the trading terms entered
into are payment at the end of the month following the month of invoice. Trade payables due at the
year end amount to 33 days’ purchases (2008: 38 days).
Auditor
Grant Thornton UK LLP have expressed willingness to continue in ofﬁce. In accordance with section
489 (4) of the Companies Act 2006 a resolution to re-appoint Grant Thornton UK LLP will be
proposed at the Annual General Meeting to be held on 5 August 2009. 17
Annual General Meeting (AGM)
It is proposed that the next AGM of the Company will be held on 5 August 2009, at 10.00 am,
notice of which is set out on pages 68 to 70. In addition to the proposed resolutions to receive the
Report and Accounts, declare a dividend, re-appoint Directors in accordance with the Company’s
Articles of Association, to appoint Grant Thornton UK LLP as Auditor and to authorise the Directors
to ﬁx the Auditor’s remuneration, and to approve the Remuneration Report, it is proposed that the
following business be transacted:
Directors’ authority to allot securities (Resolution 8 - Ordinary resolution)
The Directors seek to renew this authority each year at the AGM. The effect of resolution 8 is to
grant to the Directors authority to allot new securities limited to an aggregate nominal amount of
£581,378 representing approximately one third of the Company’s issued share capital as at 31
March 2009 (being the date of the Company’s last Annual Accounts). This renewed authority would
remain in force for 15 months from the passing of the resolution or, if earlier, until the next AGM.
Disapplication of pre-emption rights (Resolution 9 - Special resolution)
The Directors seek to renew this authority each year at the AGM. Under the Companies Act 1985,
shareholders have “rights of pre-emption” in relation to the issue of equity securities. This means
that if new shares in the Company are to be offered for subscription for cash they must ﬁrst be
offered to the existing shareholders in proportion to their holdings at the time of such offer. The
Companies Act requires that the Directors seek the approval of the shareholders if they wish to
disapply these rights. The Directors are seeking authority to disapply pre-emption rights over
1,760,135 equity securities, representing approximately 5% of the issued share capital of the
Company as at 31 March 2009. This renewed authority would remain in force for 15 months from
the passing of the resolution or, if earlier, until the next AGM.
Company’s authority to purchase its own shares (Resolution 10 - Special resolution)
The Directors are seeking to renew the authority for the Company to purchase in the open market
up to 10% of the issued share capital of the Company. The Company undertakes that it will, if the
resolution is passed, only exercise such authority to buy back its own shares if such purchase would
have the effect of increasing the earnings per share and if they believed that to do so would be in
the best interests of the shareholders generally.
If the resolution is passed the Company will be authorised to buy in one transaction or any number
of transactions an aggregate maximum of 3,488,271 shares, representing approximately 10% of the
issued share capital of the Company as at 19 June 2009 (being the latest practicable date prior to
publication of the Notice of AGM).
The maximum price the Company will be permitted to pay will be equal to 5% above the average
middle market quotations for the ﬁve business days preceding the transaction and the minimum
price will be 5 pence (being the nominal value of the shares).
The total number of options to subscribe for ordinary shares outstanding as at 19 June 2009 was
130,284 representing approximately 0.37% of the issued share capital of the Company at such date.
If the authority to purchase shares were to be exercised in full, the total number of options to
subscribe for ordinary shares outstanding as at 19 June 2009 would represent 0.32% of the issued
share capital (assuming no other further ordinary shares were issued after that date).
Notice of General Meetings (Resolution 11 – Special resolution)
The Shareholder Rights Directive is intended to be implemented in the UK in August of this year.
One of the requirements of the Directive is that all general meetings must be held on 21 days’ notice
unless shareholders agree to a shorter notice period. The Company is currently able to call general
meetings (other than annual general meetings and general meetings for the passing of special
resolutions) on 14 days’ notice and would like to preserve this ability. In order to be able to do so
after August 2009, shareholders must have approved the calling of general meetings (other than
Report of the Directors
(continued) annual general meetings or general meetings for the passing of special resolutions) on 14 clear days’
notice. We are proposing resolution 11 at the AGM to seek this approval. The approval will be
effective until the Company’s next annual general meeting when it is intended that a similar
resolution will be proposed.
Statement of Directors’ Responsibilities
The Directors are responsible for preparing the Annual Report and the ﬁnancial statements in
accordance with applicable law and regulations.
Company law requires the Directors to prepare ﬁnancial statements for each ﬁnancial year which
give a true and fair view of the state of affairs of the parent Company and the Group as at the end
of the ﬁnancial year and of the proﬁt or loss of the Group for the ﬁnancial year. Under that law the
Directors are required to prepare the Group ﬁnancial statements in accordance with International
Financial Reporting Standards as adopted by the European Union (IFRSs). The Directors have
elected to prepare the parent Company ﬁnancial statements in accordance with United Kingdom
Generally Accepted Accounting Practice (UK GAAP). In preparing these ﬁnancial statements, the
Directors are required to:
• select suitable accounting policies and then apply them consistently
• make judgements and estimates that are reasonable and prudent
• for the Group ﬁnancial statements, state whether applicable IFRSs have been followed, subject to
any material departures disclosed and explained in the ﬁnancial statements;
• for the parent Company ﬁnancial statements, state whether applicable UK Accounting Standards
have been followed, subject to any material departures disclosed and explained in the ﬁnancial
statements;
• prepare the ﬁnancial statements on the going concern basis unless it is inappropriate to presume
that the Company will continue in business.
The Directors are responsible for keeping proper accounting records that disclose with reasonable
accuracy at any time the ﬁnancial position of the Company and enable them to ensure that the
ﬁnancial statements comply with the Companies Act. They are also responsible for safeguarding the
assets of the Company and hence for taking reasonable steps for the prevention and detection of
fraud and other irregularities.
In so far as the Directors are aware:
• there is no relevant audit information of which the Company’s auditors are unaware; and
• the Directors have taken all steps that they ought to have taken to make themselves aware of any
relevant audit information and to establish that the auditors are aware of that information.
Responsibility statement required by Disclosure and Transparency Rules
To the best of our knowledge:
• the ﬁnancial statements, prepared in accordance with the applicable set of accounting standards,
give a true and fair view of the assets, liabilities, ﬁnancial position and proﬁt or loss of the
Company and the undertakings included in the consolidation taken as a whole; and
• the management report includes a fair review of the development and performance of the business
and the position of the Company and the undertakings included in the consolidation taken as a
whole, together with a description of the principal risks and uncertainties that they face.
Rakesh V Patel
Chief Executive Ofﬁcer
18
Report of the Directors
(continued) 19
Cautionary statement on forward-looking statements and related
information
This document contains a number of forward-looking statements relating to the Group with respect
to, amongst others, the following: ﬁnancial conditions; results of operations; economic conditions in
which the Group operates; the business of the Group; and management plans and objectives. The
Group considers any statements that are not historical facts as "forward-looking statements". They
relate to events and trends that are subject to risks and uncertainties that could cause the actual
results and ﬁnancial position of the Group to differ materially from the information presented in the
relevant forward-looking statement. When used in this document the words "estimate", "project",
"intend", "aim", "anticipate", "believe", "expect", "should" and similar expressions, as they relate to the
Group or the management of it, are intended to identify such forward-looking statements. Readers
are cautioned not to place undue reliance on these forward-looking statements which speak only as
at the date of this document. Neither the Group nor any member of the Group's management
undertake any obligation publicly to update or revise any of the forward looking statements, whether
as a result of new information, future events or otherwise, save in respect of any requirement under
applicable laws, the Listing Rules, and other regulations.
The Directors are responsible for the maintenance and integrity of the corporate and ﬁnancial
information included on the Company's website. Legislation in the United Kingdom governing
the preparation and dissemination of ﬁnancial statements may differ from legislation in other
jurisdictions.
BY ORDER OF THE BOARD
S Venkateswaran
Secretary
24 June 2009
Report of the Directors
(continued) 20
Application of principles
The Group is committed to applying the best principles of Corporate Governance. The Compliance
Statement is given under the Combined Code 2006 issued by the FRC (the combined code).
Compliance statement
The Company has complied throughout the year with the Code provisions set out in section 1 of the
Combined Code.
Board composition
The Company is controlled through its Board of Directors. The Board comprises the non-executive
Chairman and two other non-executive Directors, the Chief Executive Ofﬁcer, the Chief Financial
Ofﬁcer and one other executive Director. The Board’s main roles are to create value for shareholders,
to approve the Company’s strategic objectives and to ensure that the necessary ﬁnancial and other
resources are made available to enable them to meet those objectives. Speciﬁc responsibilities
reserved to the Board include: setting Group strategy, reviewing operational and ﬁnancial
performance, approving major acquisitions, divestments and capital expenditure; approving
appointments to the Board and the Company Secretary, approving policies relating to Directors
remuneration and the severance of Directors’ contracts; and ensuring that a satisfactory dialogue
takes place with shareholders.
The executive Directors of the Board are:
Rakesh V Patel
Ajay M Patel
Ram Swamy
All the above executive Directors submit themselves for re-election at least every three years and at the
ﬁrst AGM after appointment.
The non-executive Directors are Nick Woollacott, Paul Edwards MBE and Dr. Keith Hellawell QPM,
who is also Chairman of the Group.
Nick Woollacott is the Senior independent non-executive Director and also chairs the Audit Committee.
Paul Edwards MBE is another independent non-executive Director and also chairs the Remuneration
Committee.
The Board met 9 times during the year under review. At each meeting the Board receives reports from
the Chief Executive Ofﬁcer and other Directors and senior management as required.
The Board has three Committees, whose terms of reference can be inspected by prior arrangement at
Goldshield’s ofﬁce in Croydon.
Audit Committee
Nick Woollacott (Chairman)
Paul Edwards MBE
The Audit Committee’s duties include reviewing the external audit arrangements, including the
scope, results and cost effectiveness of the audit, any changes in accounting policies and
procedures, the judgmental decisions affecting ﬁnancial reporting, compliance with accounting
standards and with the Companies Act and considering the auditors’ comments on internal controls
and management’s response. The Audit Committee monitors the nature and extent of non-audit
services provided by the auditors to ensure their independence and objectivity is maintained.
Nick Woollacott is a member of the Audit Committee of an AIM listed company and has past
experience as a member of Audit committees of listed companies. The Board is of the opinion that
Nick Woollacott satisﬁes the requirement for recent and relevant ﬁnancial experience.
Audit Committee meetings are also attended by invitation by representatives of the Group’s auditors,
Corporate Governance Report 21
the Chairman, the Chief Executive Ofﬁcer, the Chief Financial Ofﬁcer and the Company Secretary.
The Committee considers the Group’s annual and interim ﬁnancial statements and any questions
raised by the auditors on the statements and ﬁnancial systems.
During the year, the Audit Committee met twice and reviewed the Group’s draft ﬁnancial statements
and interim results statement prior to Board approval and considered the external auditors’ detailed
reports thereon. The Committee also reviewed the performance of the in-house internal audit
function. The audit plan is independently drawn up by the in-house internal audit department and
discussed with the Audit Committee for adequacy of coverage. The Audit Committee also directs the
internal audit department to carry out speciﬁc assignments. The internal audit reports are given to
the operating heads, and are also independently discussed with the Audit Committee for their
feedback and suggestions which are then implemented upon.
The Group’s auditors, Grant Thornton UK LLP , provide some non-audit services. The majority of
these are compliance services on various taxation issues within the Group, and do not compromise
their independence as auditors. The level of non-audit fees (which are less than the audit fees) are
reviewed annually by the Committee.
Remuneration Committee
Paul Edwards MBE (Chairman)
Nick Woollacott
Dr. Keith Hellawell QPM, Group Chairman attends the meetings of the Remuneration Committee by
invitation.
The Remuneration Committee met twice in the ﬁnancial year and determined the Directors’
remuneration and the issue of share options. None of the Committee members have any personal
ﬁnancial interest in the matters to be decided, nor potential conﬂicts of interest arising from cross-
directorships nor any day to day involvement in the running of the business. The Committee consults
with the Board about its proposals and has access to professional advice from inside and outside
the Group.
Nomination Committee
Dr. Keith Hellawell QPM (Chairman)
Nick Woollacott
Paul Edwards MBE
The Nomination Committee meets as required to select and recommend suitable candidates to the
Board for both executive and non-executive appointments. The selection process includes search
using external agencies. As at 31 March 2009, the number of non-executive Directors stood at 3,
complying with the provision of Combined Code 2006 issued by the FRC (the combined code).
The number of scheduled Board meetings and Committee meetings attended by each Director during
the year was as follows:
Scheduled Audit Remuneration Nomination
Board Committee Committee Committee
Name of the Director Meetings Meetings Meetings Meetings
Dr. Keith Hellawell QPM - Chairman 9 / (9) 2 / (2)(*) 2 / (2)(*) 2 / (2)
Rakesh V Patel 9 / (9) 2 / (2)(*) n/a n/a
Ajay M Patel 9 / (9) n/a n/a n/a
Ram Swamy (w.e.f. 6 August 2008) 7 / (7) 1 / (1)(*) n/a n/a
Nick Woollacott 8 / (9) 2 / (2) 2 / (2) 2 / (2)
Paul Edwards MBE 9 / (9) 2 / (2) 2 / (2) 2 / (2)
Figure in brackets indicate maximum number of meetings in the period in which the individual was a Board member
Corporate Governance Report
(continued) n/a - indicates not applicable (*) Attendance by invitation
Shareholder relations
The Chairman and the Chief Executive Ofﬁcer meet and telephone institutional shareholders to
discuss the Group’s strategy and ﬁnancial performance. Efforts are made to keep shareholders
informed through analysts’ meetings, road shows and soundings taken from individual shareholders
as and when required.
All shareholders can gain access to information about the Group, including the annual report,
through the Goldshield website www.goldshieldplc.com.
Risk management and internal controls
The Directors acknowledge their responsibility for the Group’s system of internal controls. The intent
is to manage risk rather than eliminate it and controls cannot provide an absolute assurance against
material misstatement or loss. Decision on key issues is taken by the Board keeping in mind the
possible risks associated with the situation and ability of the Group to manage those risks effectively.
The key features of the Group’s systems of internal controls are as follows:
• Control environment: short and direct lines of responsibility are designed to ensure that business
risks are communicated for prompt review. The performance of each business unit is reviewed at
regular monthly meetings. The full Board also reviews the same at regular Board meetings held at
least six times each year. A period of at least ﬁve days each year is set aside for strategic planning
and assessment of risks affecting the Group attended by senior managers from all parts of the
Group when matters of strategic importance are discussed with speciﬁc emphasis on training and
development. Further, the Board meets every quarter for a two day strategic meeting during which
the Board evaluates the strategic direction and performance of the Group.
• Operating procedures: key quality and ﬁnancial controls are documented as operating procedures
setting out responsibilities and ﬁnancial authority levels.
• Budgeting: a comprehensive budgeting procedure is followed. The Chief Financial Ofﬁcer presents
an annual forecast at Group level for discussion and agreement by the Board.
• Information systems: the Group’s accounting systems are backed up and scaleable to meet
business needs.
Sufﬁcient precautions are taken to retain the processed data in an off-site location, which forms part
of the disaster recovery program followed by the Group. The Group has selected SAP as the
Enterprise Resource Planning software which is on schedule to be implemented by the end of the
calendar year.
A regular review takes place with the Group insurance brokers to assess the adequacy of the Group’s
insurance cover in the face of operational and other risks of the business.
The Board fully recognises the importance of adopting appropriate risk and control measures. The
Group has initiated steps in introducing a risk management program with a requirement to have
speciﬁc risk management objectives for key associates. The Audit Committee has reviewed the annual
report from the in-house internal audit function and is satisﬁed with the scope and quality of audit work
taken up in different areas of operational controls and the work undertaken to compile a comprehensive
Risk Register. The Committee also reviews the internal audit reports keeping in mind the need to take
remedial actions on signiﬁcant audit ﬁndings pursuant to C.2.1 of the Combined Code.
Going concern
After considering the plans of the Group for the forthcoming year and after making enquiries, the
Directors have a reasonable expectation that the Group has adequate resources to continue in
operational existence for the foreseeable future. For this reason they continue to adopt the going
concern basis in preparing the ﬁnancial statements. An explanation of the Group’s cash ﬂow position
at 31 March 2009 is set out on page 35.
Corporate Governance Report
(continued)
22 23
Goldshield is committed to being a socially responsible corporate citizen.
Environment
Measures to save energy and ﬁnite resources are taken where practicable; in particular relating to
controlled use of energy, paper and other resources. The Board does not consider it appropriate to
implement a detailed environmental policy for its activities given that it does not itself manufacture
products. The Board does however share current concerns on environmental issues and will where
possible ensure that its activities are carried out in an environmentally friendly manner. The Group
has partnered with TREES FOR THE FUTURE, INC., in 2008. T .F .T .F . is a non-proﬁt organisation
dedicated to helping people of the world’s poorest communities to begin environmentally beneﬁcial,
self-help projects. Through this partnership, Goldshield has planted 39,757 trees around the world.
Health and safety
The Board aims to take due and proper care of risks to the health, safety and welfare of its
employees taking into account the differences that apply to legislative requirements in the different
countries where it operates. Particular attention is paid to ﬁre drills and other safety procedures in
establishments operated by the Group.
Ethics
The Group has policies on business practices, receipt of gifts, use of the internet and whistle
blowing. The Group realises that its reputation depends on adopting ethical and socially responsible
procedures and will encourage adoption of necessary employment, health and safety and other
appropriate procedures to meet this objective.
Employment
The Group employs over 900 employees worldwide based in the United Kingdom and India,
principally, and in other countries. Our success depends on the skills and attitude of our employees.
Our human resource strategies are aimed at ensuring that employees are trained to be competent to
fulﬁl their roles and with an opportunity to develop to their full potential. Emphasis is placed on
sharing knowledge for the beneﬁt of employees and the Group.
The Group operates in an international market and we believe all employees shall be treated with
dignity and respect. Decisions relating to recruitment, development, promotion and training of
individual employees are based on an objective assessment of skills and job requirements.
Community involvement
Employees are encouraged to make contributions to charities and other community causes and
collections are regularly made for charitable purposes. The Group is involved making donations of
medicine to charities and securing the environment by planting trees.
Corporate Social Responsibility Report 24
Directors’ Remuneration Report
Introduction
This report has been prepared in accordance with the requirements of Schedule 7A to the
Companies Act 1985 (as amended by the Directors’ Remuneration Report Regulations 2002). It
also describes the Company's compliance with the Combined Code of Corporate Governance in
relation to remuneration matters.
The report is divided into two parts. The ﬁrst part contains commentary of the remuneration policy
which is not required to be audited. The second part contains the remuneration tables which have
been audited in accordance with the relevant statutory requirements.
Section 1: Information not subject to audit
The Remuneration Committee
The Remuneration Committee (the Committee) is comprised of independent non-executive Directors.
The Committee is chaired by Paul Edwards MBE. None of the Committee members has any personal
ﬁnancial interest in the matters to be decided, nor potential conﬂicts of interest arising from cross
directorships nor any day-to-day involvement in the running of the business.
The role of the Committee is to recommend to the Board the policy for the remuneration of the
Company Chairman, the executive Directors and the management tier below Board level.
The Committee invites the Chief Executive Ofﬁcer and other executive Directors to attend its
meetings when appropriate although no person is present for any discussion or decision relating to
their personal remuneration. The Committee receives external advice from Hewitt New Bridge Street.
The Committee met twice during the course of the year. Its terms of reference are available from the
Company Secretary on request.
Remuneration Policy
The Committee aims to ensure that Directors’ remuneration is fair and in line with market rates in
comparable companies. Incentive schemes are designed to provide rewards for achieving objectives
that will increase shareholder value. A signiﬁcant proportion of remuneration is performance-related.
The table below summarises each key element of Executive Director's Remuneration:
In setting the remuneration policy for executive Directors, the Committee considers how packages
compare with remuneration for employees across the Company more generally. The Committee also
has discretion to consider corporate performance on environmental, social and governance (ESG)
issues when setting the remuneration of executive Directors. The Committee does not believe that
ESG risks are inadvertently raised by the remuneration structure currently in place.
The remuneration policy is reviewed annually by the Committee.
Element of Remuneration Purpose Policy Operation
Package
Base salary • To recruit and retain key executives. • To pay at around the mid-market • Cash
• To reﬂect the individual's experience level relative to similarly sized • Monthly
and role within the Company. companies in relevant sectors. • Pensionable
• Recognise applicable skills • Reviewed annually
and experience.
Annual bonus • To incentivise and reward annual • Maximum bonus potential set by • Cash
performance against reference to market comparators • Annual
pre-determined targets. (65% of base salary for all • Non-pensionable
Executive Directors).
Long-Term • To incentivise executives to deliver • To provide the opportunity to earn • 50% of each award
Incentive Plan superior returns for shareholders. upper quartile reward from the LTIP is based on Total
(LTIP) • To align the interests of executives for outstanding performance. Shareholder Return.
and shareholders. • 170% of base salary for the Chief • 50% of each awards
• To help retain key executives over Executive Ofﬁcer and up to 120% of based on Earnings
the longer-term. base salary for other Directors. per Share targets.
Pension • To contribute to retirement savings. • To provide median level deﬁned • Deﬁned contribution.
contribution pension beneﬁts.
• 12% of base salary Company
contribution. 25
Elements of Remuneration
Base Salary
Executive Directors’ base salaries are reviewed annually by the Committee taking into account the
responsibilities, skills and experience of each individual, and the salary levels within companies of
similar size in the pharmaceutical and healthcare sectors and the executive Director market generally.
Salaries were last reviewed in May 2009 when it was decided to increase the salaries as detailed
below:
Base salary levels as at 1 April 2008 and 2009 are as follows:
1
Appointed 6 August 2008
Beneﬁts
Beneﬁts comprise medical insurance, critical illness insurance and life insurance.
Annual Bonus
Executive Directors participate in an annual bonus arrangement based on EBITDA (Earnings Before
Interest, Tax, Depreciation and Amortisation) targets related to the proﬁt expectations in the
Company’s business plan and the market, pre-determined business unit ﬁnancial targets and non-
ﬁnancial targets. The Committee has discretion to vary, increase or decrease bonuses that are
mechanistically produced by these formulae.
The maximum annual bonus was capped at 65% of base salary for 2008/09.
The annual bonus awarded for 2008/09 was 65% of base salary to Rakesh V Patel, 52% to
Ajay M Patel and 56% on pro-rated base salary to Ram Swamy.
Long-term Incentive Plan (LTIP)
The LTIP was approved by shareholders at the 2007 Annual General Meeting and is the primary
long-term incentive arrangement operated by the Company. Awards granted during 2008/09
ﬁnancial year have the following features:
• Awards are granted at the discretion of the Committee.
• Awards are in the form of Performance Shares.
• Performance conditions are 50% Total Shareholder Return (TSR) and 50% Earnings per Share
(EPS) growth.
• The maximum award size is 170% of base salary (face value) per annum.
• Performance and vesting periods are normally three years. There is no retesting of performance
targets (i.e. awards lapse if performance targets are not met).
• On a change in control of the Company, the number of LTIP shares to be released to a participant
will be determined by the Committee at its discretion. In the exercise of its discretion, the
Committee may take into account the period elapsed from the start of the performance period to
the date of the change in control, and the performance of the Company over the same period.
For awards granted in 2008/09:
• 150/170th of the Chief Executive Ofﬁcer’s award, 100/120th of the Group Executive Director's
award and 100/120th of the Chief Financial Ofﬁcer's award will vest if both the TSR and EPS
maximum performance levels are achieved. If they are both achieved then the Committee may
allow the remaining 20% of salary award to vest.
Directors’ Remuneration Report
(continued)
Name Role Salary at 1 April 2009 Salary at 1 April 2008
Rakesh V Patel Chief Executive Ofﬁcer £325,000 £315,000
Ajay M Patel Group Executive Director £232,000 £225,000
Ram Swamy
1
Chief Financial Ofﬁcer £175,000 – 26
• The performance target attached to 50% of an LTIP award is based on absolute TSR performance.
25% of this part of an award will vest for compound TSR growth of 12.5% per annum rising on
a straight line basis to full vesting for compound growth of 25% per annum.
• The performance target attached to the other 50% of an LTIP will vest for performance against
EPS targets deﬁned as proﬁt after tax excluding exceptional legal costs divided by weighted
average number of equity shares. 25% of this part of an award will vest for EPS of 22.5 pence
on 31 March 2011 rising on a straight line basis to full vesting for EPS of 30 pence.
The Committee considers that the combination of EPS and TSR performance provides a good
balance of performance metrics, with EPS targets aligned to ﬁnancial achievement and TSR targets
aligned to market value growth for shareholders. TSR calculations are prepared by a third-party data
provider and are reviewed by the Committee.
It is the intention of the Committee to make further awards during the 2009/10 ﬁnancial year under
the LTIP using similar performance conditions to those above that are robust and challenging, whilst
taking into account prevailing industry and market conditions.
Goldshield Group plc Share Option Plan
The Company has made awards under the Goldshield Group plc Share Option Plan in the past. No
grants were made to Executive Directors during the year under this Plan.
All-Employee Share Scheme
The Company operates a Sharesave Scheme that is open to all employees in the UK, including
Executive Directors. No performance conditions are attached to options granted under the Scheme
as it is an HM Revenue & Customs approved all-employee scheme.
Pension
The Company contributes 10% of base salary for each executive Director, either to a Company
Deﬁned Contribution pension scheme, an Executive Personal Pension, or provides an equivalent
taxable cash allowance. For the year commencing 1 April 2009 this has been increased to 12% of
base salary.
Shareholding Requirements
There is no minimum shareholding requirement for any Director, although the Committee
encourages Executive Directors to increase their shareholdings over time.
Chairman and Non-Executive Directors
Non-executive Directors’ remuneration is set by the Board as a whole (except the Chairman's fee
which is set by the Committee) reﬂecting time commitment, responsibility of each role and fees
paid in comparable companies. Non-executive Directors are not able to participate in any of the
Company's share incentive schemes or annual bonus arrangements, and do not receive any other
beneﬁts.
Fee levels as at 1 April 2008 and 2009 are as follows:
1. Chairman of the Audit Committee 2. Chairman of the Remuneration Committee
Directors’ Remuneration Report
(continued)
Name Role Fee at 1 April 2009 Fee at 1 April 2008
Dr Keith Hellawell QPM Company Chairman £111,240 £108,000
Nick Woollacott Non-Executive Director
1
£36,050 £35,000
Paul Edwards MBE Non-Executive Director
2
£36,050 £35,000 Details of actual fees paid for the year ended 31 March 2009 are displayed on page 28.
Service Contracts
The Company’s contracts of service for executive Directors are for a twelve monthly renewable period
(six months for non-executive Directors). There are no other provisions relating to early termination.
External Directorships
No executive Director currently holds any external non-executive directorships.
Remuneration strategy throughout the Group
The Chief Executive Ofﬁcer’s strategy, with the support of the Committee, is to ensure that support
departments and sales units operate as if they were independent entities with performance schemes
structured for the delivery of commercial targets. This has enabled managers to partake in the bonus
plan based on the performance of their respective units, which has helped to focus attention on driving
the performance of those units.
Total Shareholder Return performance graph
The graph below shows the Company's ﬁve-year performance, measured by Total Shareholder Return
(TSR), compared with the FTSE Small Cap Index (excluding Investment Trusts). The FTSE Small Cap
Index is a widely recognised comparator index. The graph indicates that over the 5 years to 31 March
2009, £100 invested in Goldshield Group plc shares would have grown in value to £152, whilst £100
invested in the Index would have reduced in value to £62 over the same period.
Total shareholder return
Source: Thomson Financial
This graph shows the value, by 31 March 2009, of £100 invested in Goldshield Group plc on 31 March 2004 compared with
the value of £100 invested in the FTSE SmallCap (excluding Investment Trusts). The other points plotted are the values at
intervening ﬁnancial year-ends.
27
Directors’ Remuneration Report
(continued)
Date of Notice period from Compensation payable
contract the Company on early termination
Dr Keith Hellawell QPM 15 May 2006 6 months Contractual
Nick Woollacott 8 August 2007 6 months Contractual
Paul Edwards MBE 8 August 2007 6 months Contractual
Rakesh V Patel 5 April 2006 12 months Contractual
Ajay M Patel 5 April 2006 12 months Contractual
Ram Swamy 6 August 2008 6 months Contractual 28
Directors’ Remuneration Report
(continued)
Section 2: Information subject to audit
Directors’ Emoluments
Salary/ Taxable Bonus Total Total
fees beneﬁts payable Pension 2009 2008
Executive Directors ££ £ £ £ £
Rakesh V Patel 315,000 4,017 204,750 31,500 555,267 396,449
Ajay M Patel 225,000 4,370 117,000 22,500 368,870 321,941
Ram Swamy
1
132,673 1,431 55,000 – 189,104 –
Non-executive Directors
Dr. Keith Hellawell QPM
2
146,000 –– – 146,000 123,492
Nick Woollacott 35,000 –– – 35,000 22,840
Paul Edwards 35,000 –– – 35,000 19,577
Former Directors
Executive Directors
Ajit R Patel –– – – – 638,067
Kirti V Patel –– – – – 387,478
Mike Reardon –– – – – 400,713
Non-executive Directors
Peter M Brown –– – – – 13,756
Ken O Pelton –– – – – 43,875
888,673 9,818 376,750 54,000 1,329,241 2,368,188
Notes:
(1) Ram Swamy, Chief Financial Ofﬁcer joined the Company on 6 August 2008 and his salary includes £25,000 for
signing fees as a one time payment and £9,788 as taxable cash allowance in lieu of pension.
(2) Fees paid to Dr. Keith Hellawell QPM, includes an amount of £38,000 for additional consulting work carried out on
behalf of Goldshield Group plc in connection with the Serious Fraud Ofﬁce case. 29
Directors' LTIP awards
Goldshield Long-Term Incentive Plan (LTIP) Awards
Mid market
Lapsed Released price at date
At start Awarded during the during the At end of award Date of Date of
of year in year year year of year (pence) award vesting
Rakesh V Patel
Performance shares 192,890 –– – 192,890 231.0 12 Sep 07 12 Sep 10
Performance shares – 211,243 –– 211,243 253.5 17 Sep 08 12 Sep 11
192,890 211,243 –– 404,133
Ajay M Patel
Performance shares 119,593 –– – 119,593 231.0 12 Sep 07 12 Sep 10
Performance shares – 106,509 –– 106,509 253.5 17 Sep 08 12 Sep 11
119,593 106,509 –– 226,102
Ram Swamy
Performance shares – 47,337 –– 47,337 253.5 17 Sep 08 12 Sep 11
– 47,337 –– 47,337
1. For awards granted on 12 September 2007:
• 150/170th of the Chief Executive Ofﬁcer’s award and 100/120th of the Group Executive Director's award will vest if
both the TSR and EPS maximum performance levels are achieved; and if they are both achieved then the Committee
may allow the remaining 20% of salary award to vest.
• The performance target attached to 50% of an LTIP award is based on absolute TSR performance. 25% of this part of
an award will vets for compound TSR growth of 12.5% per annum rising on a straight line basis to full vesting for
compound growth of 25% per annum, and
• The performance target attached to the other 50% of an LTIP will vest for performance against EPS targets (deﬁned as
proﬁt after tax excluding exceptional legal costs divided by weighted average number of equity shares) 25% of this part
of an award will vest for EPS of 20 pence on 31 March 2010 rising on a straight line basis to full vesting for EPS of
27.5 pence.
2. For awards granted on 17 September 2008:
• 150/170th of the Chief Executive Ofﬁcer’s award and 100/120th of the Group Executive Director's award and of the
Chief Financial Ofﬁcer’s award will vest if both the TSR and EPS maximum performance levels are achieved; and if
they are both achieved then the Committee may allow the remaining 20% of salary award to vest.
• The performance target attached to 50% of an LTIP award is based on absolute TSR performance. 25% of this part
of an award will vets for compound TSR growth of 12.5% per annum rising on a straight line basis to full vesting for
compound growth of 25% per annum, and
• The performance target attached to the other 50% of an LTIP will vest for performance against EPS targets (deﬁned
as proﬁt after tax excluding exceptional legal costs divided by weighted average number of equity shares) 25% of this
part of an award will vest for EPS of 22.5 pence on 31 March 2011 rising on a straight line basis to full vesting for
EPS of 30 pence.
Directors’ share options
The interests of the Directors in options over ordinary shares during the year were as follows:
Exercise Date from
At start At end Price which Expiry
of year Granted Lapsed Exercised of year (pence) exercisable date
Ajay M Patel
Sharesave 6,531 –– – 6,531 275.2 1 Aug 09 31Jan 10
6,531 –– – 6,531
Directors’ Remuneration Report
(continued) No share options have been granted to the non-executive Directors.
The options granted under the unapproved share scheme were allotted as part of the remuneration
package for nil consideration.
The market price of the ordinary shares at 31 March 2009 was 311 pence and the range during
the year ended 31 March 2009 was 160.25 pence to 325 pence.
On behalf of the Board
Paul Edwards MBE
Chairman of the Remuneration Committee
24 June 2009
30
Directors’ Remuneration Report
(continued) 31
We have audited the consolidated ﬁnancial statements of Goldshield Group plc for the year ended
31 March 2009 which comprise the Consolidated Income Statement, the Consolidated Balance
Sheet, the Consolidated Cash Flow Statement, the Consolidated Statement of Recognised Income
and Expense and notes 1 to 26. These consolidated ﬁnancial statements have been prepared under
the accounting policies set out therein.
We have reported separately on the parent company ﬁnancial statements of Goldshield Group plc
for the year ended 31 March 2009 and the information in the Directors’ Remuneration Report that
is described as having been audited.
This report is made solely to the Company’s members, 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 members those matters we are required to state to them in an auditor’s report and for
no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility
to anyone other than the Company and the Company’s members as a body for our audit work, for
this report, or for the opinions we have formed.
Respective responsibilities of Directors and auditor
The Directors’ responsibilities for preparing the Annual Report and the consolidated ﬁnancial
statements in accordance with United Kingdom law and International Financial Reporting Standards
(IFRSs) as adopted by the European Union are set out in the Statement of Directors’ Responsibilities
within the Report of the Directors.
Our responsibility is to audit the consolidated ﬁnancial statements and the Directors’ Remuneration
Report in accordance with relevant legal and regulatory requirements and International Standards
on Auditing (UK and Ireland).
We report to you our opinion as to whether the consolidated ﬁnancial statements give a true and fair
view and whether the consolidated ﬁnancial statements have been properly prepared in accordance
with the Companies Act 1985 and Article 4 of the IAS Regulation. We also report to you whether
in our opinion the information given in the Report of the Directors is consistent with the ﬁnancial
statements.
In addition we report to you if, in our opinion, 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 review whether the Corporate Governance Statement reﬂects the Company’s compliance with
the nine provisions of the 2006 Combined Code speciﬁed for our review by the Listing Rules of the
Financial Services Authority, and we report if it does not. We are not required to consider whether
the Board’s statements on internal control cover all risks and controls, or form an opinion on the
effectiveness of the Group’s corporate governance procedures or its risk and control procedures.
We read other information contained in the Annual Report and consider whether it is consistent with
the audited consolidated ﬁnancial statements. The other information comprises only the Directors,
Secretary and Advisors, the Business Highlights, Chairman's Overview, Chief Executive Ofﬁcer's
Operating Review, Report of the Chief Financial Ofﬁcer, Five Year Review, Directors, Report of the
Directors, Corporate Governance Report, Corporate Social Responsibility Report and the unaudited
part of the Directors’ Remuneration Report. We consider the implications for our report if we become
aware of any apparent misstatements or material inconsistencies with the consolidated ﬁnancial
statements. Our responsibilities do not extend to any other information.
Report of the Independent Auditor on the
consolidated financial statements to the
Members of Goldshield Group plc 32
Report of the Independent Auditor on the consolidated
financial statements to the Members of Goldshield Group plc
(continued)
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 examination, on a test basis, of evidence
relevant to the amounts and disclosures in the consolidated ﬁnancial statements. It also includes an
assessment of the signiﬁcant estimates and judgments made by the Directors in the preparation of
the consolidated ﬁnancial statements, and of whether the accounting policies are appropriate to the
Group's circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we
considered necessary in order to provide us with sufﬁcient evidence to give reasonable assurance
that the consolidated 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 consolidated ﬁnancial statements.
Opinion
In our opinion:
• the consolidated ﬁnancial statements give a true and fair view, in accordance with IFRSs as
adopted by the European Union, of the state of the Group’s affairs as at 31 March 2009 and of
its proﬁt for the year then ended;
• the consolidated ﬁnancial statements have been properly prepared in accordance with the
Companies Act 1985 and Article 4 of the IAS Regulation; and
• the information given in the Directors' Report is consistent with the ﬁnancial statements.
Separate opinion in relation to IFRSs
As explained in Note 1 to the consolidated ﬁnancial statements, the Group, in addition to complying
with its legal obligation to comply with IFRSs as adopted by the European Union, has also complied
with the IFRSs as issued by the International Accounting Standards Board.
In our opinion the consolidated ﬁnancial statements give a true and fair view, in accordance with
IFRSs, of the state of the Group’s affairs as at 31 March 2009 and of its proﬁt for the year then ended.
GRANT THORNTON UK LLP
REGISTERED AUDITOR
CHARTERED ACCOUNTANTS
LONDON
24 JUNE 2009 33
Consolidated Income Statement
for the year ended 31 March 2009
Before Before
impairment impairment
and and
Notes exceptional Exceptional Total exceptional Exceptional Total
items items Impairment 2009 items items Impairment 2008
£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Revenue 2 98,397 –– 98,397 84,934 –– 84,934
Cost of sales (30,162) –– (30,162) (27,425) –– (27,425)
Gross proﬁt 68,235 –– 68,235 57,509 –– 57,509
Distribution costs (5,519) –– (5,519) (4,340) –– (4,340)
Impairment losses 7/8 –– (749) (749) –– (483) (483)
Exceptional legal and
professional costs – 2,100 – 2,100 – (328) – (328)
Other administrative expenses (43,830) –– (43,830) (41,194) –– (41,194)
Administrative expenses (43,830) 2,100 (749) (42,479) (41,194) (328) (483) (42,005)
Operating proﬁt 3 18,886 2,100 (749) 20,237 11,975 (328) (483) 11,164
Finance costs 5 (4) –– (4) (10) –– (10)
Finance income 5 1,096 –– 1,096 1,241 –– 1,241
Proﬁt before tax 19,978 2,100 (749) 21,329 13,206 (328) (483) 12,395
Income tax expense 6 (6,859) (588) – (7,447) (6,240) 98 – (6,142)
Proﬁt after tax 13,119 1,512 (749) 13,882 6,966 (230) (483) 6,253
Earnings per share
Basic (pence) 14 39.7 16.9
Diluted (pence) 14 39.7 16.9
Dividends paid
Dividends paid during
the year (pence) 8.4 7.6
Dividends paid during
the year (£’000) 15 2,948 2,817 2,817
The accompanying accounting policies and notes form an integral part of these ﬁnancial statements. 34
Consolidated Balance Sheet
as at 31 March 2009
Notes 2009 2008
£’000 £’000
Assets
Non-current
Intangible assets 7 14,906 17,416
Property, plant and equipment 8 4,803 4,106
Held to maturity investments 21 – 377
Deferred tax assets 13 602 638
20,311 22,537
Current
Inventories 9 14,229 11,686
Trade and other receivables 10 14,558 12,753
Cash and cash equivalents 11 27,462 19,197
56,249 43,636
Total assets 76,560 66,173
Equity
Equity attributable to shareholders of Goldshield Group plc
Share capital 12 1,919 1,919
Share premium 22,274 22,274
Treasury shares (4,667) (4,667)
Shares held by employee beneﬁt trust (2,762) (1,939)
Translation reserve 2,868 691
Retained earnings 32,335 21,092
Total equity 51,967 39,370
Liabilities
Non-current
Deferred tax liabilities 13 1,116 805
1,116 805
Current
Provisions 17 – 3,335
Trade and other payables 18 19,428 16,974
Other liabilities 19 1,411 1,122
Current tax liabilities 2,638 4,567
23,477 25,998
Total liabilities 24,593 26,803
Total equity and liabilities 76,560 66,173
The ﬁnancial statements were approved by the Board of Directors on 24 June 2009 and signed on their behalf by:
Rakesh V Patel, Chief Executive Ofﬁcer
Ram Swamy, Chief Financial Ofﬁcer
The accompanying accounting policies and notes form an integral part of these ﬁnancial statements. 35
Consolidated Cash Flow Statement
for the year ended 31 March 2009
2009 2008
Note £’000 £’000
Cash ﬂows from operating activities
Result for the period before tax 21,329 12,395
Depreciation 614 617
Amortisation 4,299 4,300
Impairment losses
– intangible assets 505 237
– property, plant and equipment 244 246
Equity settled share options/rewards 309 (102)
Proﬁt/(loss) on disposal of assets
– intangible assets – (43)
– property, plant and equipment 15 (4)
Finance costs 4 10
Finance income (1,096) (1,241)
26,223 16,415
Increase in inventories (2,543) (3,206)
Increase in trade and other receivables (1,805) (769)
Increase/(decrease) in provisions, trade payables and other liabilities 713 (1,923)
Taxes paid (9,734) (5,767)
Net cash from operating activities 12,854 4,750
Cash ﬂows from investing activities
Additions
– intangible assets (950) (39)
– property, plant and equipment (1,381) (1,206)
Proceeds from disposals of assets
– intangible assets – 150
– property, plant and equipment 44 5
Proceeds on maturity/(purchase)
of held to maturity investments 377 (377)
Interest received 1,096 1,241
Net cash from investing activities (814) (226)
Cash ﬂows from ﬁnancing activities
Proceeds from share issue – 785
Purchase of shares held by employee beneﬁt trust (823) (1,939)
Purchase of treasury shares – (4,667)
Interest paid (4) (10)
Dividends paid (2,948) (2,817)
Net cash from ﬁnancing activities (3,775) (8,648)
Net increase/(decrease) in cash and cash equivalents 8,265 (4,124)
Cash and cash equivalents at beginning of the year 19,197 23,321
Cash and cash equivalents at end of the year 11 27,462 19,197
The accompanying accounting policies and notes form an integral part of these ﬁnancial statements. 36
Consolidated Statement of Recognised Income
and Expense for the year ended
31 March 2009
2009 2008
£’000 £’000
Currency translation differences 3,024 1,651
Deferred tax on translation reserve (847) (476)
Net income recognised directly in equity 2,177 1,175
Proﬁt for the period 13,882 6,253
Total recognised income for the period 16,059 7,428
The accompanying accounting policies and notes form an integral part of these ﬁnancial statements. 37
Notes to the Financial Statements
1. PRINCIPAL ACCOUNTING POLICIES
Corporate information
The consolidated financial statements of Goldshield Group plc for the year ended 31 March 2009 were
authorised for issue by the Board of Directors on 24 June 2009 and the balance sheets were signed on
the Board’s behalf by Rakesh V Patel and Ram Swamy. Goldshield Group plc is a public limited company
incorporated in England and Wales whose shares are publicly traded on the London Stock Exchange.
The principal activities of the Group are described in the Report of the Directors that accompanies
these financial statements.
Basis of preparation
The consolidated financial statements have been prepared in accordance with International Financial
Reporting Standards (IFRSs) as adopted by the European Union (EU) and as issued by the
International Accounting Standards Board (IASB).
A summary of the accounting policies applied in the preparation of these consolidated financial
statements is given below. These policies have been consistently applied to all the periods presented,
unless otherwise stated.
Adoption of new and revised Standards and Interpretations
In the current year, the Group has adopted all of the new and revised Standards and Interpretations
issued by the IASB and the International Financial Reporting Committee (the IFRIC) of the IASB that
are relevant to its operations and effective for the annual reporting periods beginning on 1 April 2008.
The adoption of these new and revised Standards and interpretations do not have a material ﬁnancial
impact on the ﬁnancial statements of the Group.
Adoption of IFRS Interpretations, new and amendments to IFRS
– Applicable for the Group’s accounting periods beginning on or after 1 April 2009
At the date of approval of these ﬁnancials statements, the following standards, interpretations and
amendments thereto were issued that are mandatory for the Group’s accounting periods beginning on
or after 1 April 2009. Management assessed the relevance of these amendments and interpretations
and concluded that they are either not relevant or material to the Group or resulted in additional
disclosures.
International Financial Reporting Interpretations Committee (IFRIC) interpretations
• IFRIC 12 Service Concession Arrangements
• IFRIC 13 Customer Loyalty Programmes (IASB effective date 1 July 2008)
• IFRIC 14, IAS 19 – The Limit on a Deﬁned Beneﬁt Asset, Minimum Funding Requirements and
their Interaction
• IFRIC 15 Agreements for the Construction of Real Estate (effective 1 January 2009)
• IFRIC 16 Hedges of a Net Investment in a Foreign Operation (effective 1 October 2008)
• IFRIC 17 Distributions of Non-cash Assets to Owners (effective 1 July 2009)
• IFRIC 18 Transfers of Assets from Customers (effective prospectively for transfers on or after 1 July
2009)
Amendments to existing standards
• Amendment to IFRS 2 Share-based Payment-Vesting Conditions and Cancellations (effective 1
January 2009)
• Amendments to IFRS 1 First-time Adoption of International Financial Reporting Standards and IAS
27 Consolidated and Separate Financial Statements-Costs of Investment in a Subsidiary, Jointly
Controlled Entity or Associate (effective 1 January 2009)
• Amendment to IAS 39 Financial Instruments: Recognition and Measurement-Eligible Hedged Items
(effective 1 July 2009)
• Amendment to IFRS 7 Financial Instruments: Disclosures-Improving Disclosures About Financial
Instruments (effective 1 January 2009)
• Amendments to IAS 39 and IFRIC 9 Embedded Derivatives (effective for annual periods ending on
or after 30 June 2009)
• Improvements to IFRSs (effective 1 January 2009 other than certain amendments effective 1 July
2009) 38
International Financial Reporting Standards (IFRS)
• IAS 23 Borrowing Costs (revised 2007) (effective 1 January 2009)
• IAS 27 Consolidated and Separate Financial Statements (Revised 2008) (effective 1 July 2009)
• IFRS 3 Business Combinations (Revised 2008) (effective 1 July 2009)
Basis of consolidation
The Group financial statements consolidate those of the Company and of its subsidiary undertakings
drawn up to 31 March 2009. A subsidiary is an entity which the Company controls, which is achieved
when the Company has the power to control the financials and operating policies of an entity. Profits
or losses on intra-group transactions are eliminated in full. The results of the subsidiary undertakings
acquired during the year have been included from the date of acquisition. On acquisition of a
subsidiary, all of the subsidiary’s assets and liabilities which exist at the date of acquisition are
recorded at the fair values reflecting their condition at that date. Goodwill arising on consolidation,
representing the excess of the fair value of the consideration given over the fair values of the identifiable
net assets acquired, is capitalised net of any provision for impairment. An Employee Benefit Trust that
is controlled by its sponsoring entity, which is the Company in case of the Group, is consolidated into
the financial statements.
Revenue
Revenue from the sale of goods is recognised in the Consolidated Income Statement when the
significant risks and rewards of ownership have been transferred to the buyer. Revenue is measured at
the fair value of the consideration received/receivable by the Group for goods supplied and services
provided, excluding value added tax and trade discounts. Revenue from services rendered is recognised
in the Consolidated Income Statement by reference to the stage of completion of transactions at the
balance sheet date. The stage of completion for the Global Solutions – call centre business is
determined by the man days spent on the project for rendering the service at the end of each billing
cycle. Subscription revenue is accrued over the period of the subscription. Advertising revenue for the
Wellbeing media business is recognised when the related advertisement appears in the magazine.
Intangible assets
Goodwill
All business combinations are accounted for under the purchase method and goodwill has been
recognised on acquisitions of subsidiaries. In respect of business combinations that have occurred since
1 April 2004, goodwill represents the difference between the cost of the acquisition and the fair value
of the net identifiable assets acquired. Goodwill is stated at cost less any accumulated impairment
losses. Goodwill arising on acquisitions before 1 April 2004 has been retained at the previous UK GAAP
amounts at 31 March 2004. Goodwill is allocated to cash generating units and is not amortised but
tested for impairment annually or more frequently if events or changes in circumstances indicate that it
might be impaired.
Other intangible assets
Externally purchased product licences, trademarks, brand-names, know-how and similar intangible
items are capitalised at historical cost, net of any provision for impairment and amortised on a straight
line basis over their estimated useful economic lives which range between seven and ten years. The
amortisation cost has been included within administrative expenses in the Consolidated Income
Statement.
Software
Acquired software licences are capitalised on the basis of the costs incurred to acquire and bring into
use the specific software. These costs are amortised over their estimated useful lives between three
to five years. The amortisation cost has been included within administrative expenses in the
Consolidated Income Statement.
Notes to the Financial Statements
(continued) 39
Property, plant and equipment
Property, plant and equipment is stated at cost less the accumulated depreciation. Depreciation is
charged on a straight line basis over the estimated useful lives on the cost of the assets less their
residual value. Land is not depreciated.
The estimated useful lives are as follows:
Freehold buildings and
leasehold improvements – 25 years or over the period of lease
Ofﬁce equipment – 5 years
Plant and equipment – 6 to 7 years
Motor vehicles – 5 years
Residual values are re-assessed annually.
Directly attributable costs for construction of assets are shown under Capital work in progress and
will be transferred to the relevant category on completion of construction of the asset. Capital work in
progress is carried at cost, less any recognised impairment loss. Depreciation commences when assets
are ready for their intended use.
Impairment of non-ﬁnancial assets
Assets that have an indefinite useful life excluding land, for example goodwill, are not subject to
amortisation and are tested annually for impairment. Assets that are subject to amortisation are
reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s
carrying amount exceeds its recoverable amount. For the purposes of assessing impairment, assets are
grouped at the lowest levels for which there are separately identifiable cash flows (cash generating
units). An impairment loss is recognised at the amount by which the asset’s or cash generating unit’s
carrying amount exceeds its recoverable amount. The recoverable amount is based on the higher of the
fair value less costs to sell and value in use.
If at the balance sheet date there is any indication that an impairment loss recognised in prior periods
for an asset other than goodwill no longer exists, the recoverable amount is reassessed and the asset is
reflected at the recoverable amount.
Research and development expenditure
Expenditure on development activities is capitalised if the product or process is technically and
commercially feasible, the costs are separately identifiable and the Group has sufficient resources to
complete development. Capitalised development costs are stated at cost less accumulated amortisation
and impairment losses. Capitalised development costs are amortised from the point at which the asset
is ready to use on a straight-line basis over its useful life, not exceeding five years. All other research
and development expenditure is written off to the Consolidated Income Statement in the period in which
it is incurred.
Inventories
Inventories are stated at the lower of cost and net realisable value. The cost is determined using the
weighted average price method. The cost of ﬁnished goods comprises of product cost, its packaging
and applicable duties and taxes. Net realisable value is the estimated selling price in the ordinary
course of business, less applicable variable selling expenses.
Accounting for income taxes
Current income tax assets and/or liabilities comprise those obligations to, or claims from, ﬁscal
authorities relating to the current or prior reporting period, that are unpaid at the balance sheet date.
They are calculated according to the tax rates and tax laws applicable to the ﬁscal periods to which
they relate, based on the taxable proﬁt for the year.
Notes to the Financial Statements
(continued)
Notes to the Financial Statements
(continued) 40
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying
amounts of assets and liabilities in the ﬁnancial statements and the corresponding tax bases used
in the computation of taxable proﬁt and is accounted for using the balance sheet liability method.
This involves comparison of the carrying amount of assets and liabilities in the consolidated ﬁnancial
statements with their respective tax bases. However, deferred tax is not provided on the initial
recognition of goodwill, nor on the initial recognition of an asset or liability unless the related
transaction is a business combination or affects tax or accounting proﬁt. Deferred tax liabilities are
always provided for in full. Deferred tax assets and liabilities are calculated, without discounting, at
tax rates that are expected to apply to the period when asset is realised or the liability is settled,
based on tax rates (tax laws) that have been enacted or substantially enacted by the balance sheet
date. All changes in deferred tax assets or liabilities are recognised as a component of tax expense
in the Consolidated Income Statement, except where they relate to items that are charged or credited
directly to equity (such as translation reserve and pre 7 November 2002 grants of share options) in
which case the related deferred tax is also charged or credited directly to equity.
Tax losses available to be carried forward as well as other income tax credits to the Group are assessed
for recognition as deferred tax assets. Deferred tax assets are only recognised to the extent that it is
probable that future taxable proﬁts will be available against which the asset can be recognised and are
reduced to the extent that it is no longer probable that the related tax beneﬁt will be realised.
Deferred income tax is provided on temporary differences arising on investments in subsidiaries except
where the timing of the reversal of the temporary differences is controlled by the Group and it is
probable that the temporary difference will not reverse in the foreseeable future.
Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with an original maturity of three
months or less. Bank overdrafts that are repayable on demand and form an integral part of the Group’s
cash management are included as a component of cash.
Employee beneﬁt trust
The assets and liabilities of the Employee Beneﬁt Trust (EBT) have been included in the consolidated
ﬁnancial statements. Any assets held by the EBT cease to be recognised on the Consolidated Balance
Sheet when the assets vest unconditionally in identiﬁed beneﬁciaries.
The costs of purchasing own shares held by the EBT are shown as a deduction against equity. The
proceeds from the sale of own shares held increase equity. Neither the purchase nor sale of own
shares leads to a gain or loss being recognised in the Consolidated Income Statement.
Employee beneﬁts
The Group operates a deﬁned contribution pension scheme whereby contributions are made to
individual employee pension plans of certain employees. These costs are charged against proﬁts in
respect of the accounting period in which they are paid.
Indian gratuity costs, which represent a form of long term service beneﬁts are accrued based on
actuarial valuation at the balance sheet date, carried out by an independent actuary.
Leased assets
All leased assets are identiﬁed as operating leases if they do not transfer substantially all the risks and
rewards to the lessee.
Payments made under operating leases are charged to the Consolidated Income Statement on a
straight line basis over the period of the lease.
Foreign currencies
The reporting currency for these ﬁnancial statements is GB sterling (£) which is the parent Company’s
functional currency.
Transactions in foreign currencies are translated at the exchange rate ruling at the date of the
transaction into the parent company’s presentational currency. Monetary assets and liabilities in foreign
currencies are translated at the rates of exchange ruling at the balance sheet date. Foreign exchange
differences arising on translation are recognised in proﬁt or loss. Non monetary assets and liabilities
that are measured in terms of historical cost in a foreign entity are translated using the exchange rate
at the date of the transaction.
Notes to the Financial Statements
(continued) 41
All assets and liabilities in the ﬁnancial statements of foreign subsidiaries are translated at the
closing rate at the balance sheet date. The results of foreign operations have been converted into
Group’s reporting currency at the actual rates over the reporting period and the exchange differences
arising have been taken to translation reserve, a component of equity. The exchange differences
arising from re-translation of the net investments in subsidiaries are directly taken to translation
reserve.
Share options
For all employee share options an expense is recognised in the Consolidated Income Statement with a
corresponding credit to equity. The equity share based payment is measured at the fair value at the grant
date using the binomial lattice method. If vesting periods or other vesting conditions apply, the expense
is allocated over the vesting period, based on the best available estimate of the number of share options
expected to vest.
Long-term share incentive plan
As soon as practicable after the start of each performance period, each eligible participant will be
notiﬁed about the number of shares awarded to him/her in respect of that period. The participant
will also be informed about the form of the award, the performance targets to be achieved in relation
to the performance period and any other conditions to which the award may be subject. The fair
value of the share awards granted is recognised as an employee expense with a corresponding
increase in equity. The fair value is measured at each award date and spread over the period during
which the participants become unconditionally entitled to the awards. The fair value of the share
awards is measured using a binomial model, taking into account the terms and conditions upon
which the shares will be released to the participants.
Provisions - Legal and other disputes
Provision is made where a reliable estimate can be made of the likely outcome of legal or other
disputes against the Group. In addition, provision is made for legal and other expenses arising from
claims received or other disputes. No provision is made for other possible claims or where an
obligation exists but it is not possible to make a reliable estimate. Costs associated with claims made
by the Group against third parties are charged to the Consolidated Income Statement as they are
incurred. The provisions are not discounted as the impact is not material.
Exceptional legal and professional costs
Exceptional legal and professional costs are expenditure incurred and provided for defending the legal
claims against the Group by the Department of Health and the Serious Fraud Ofﬁce.
Dividends
Dividends proposed or declared after the balance sheet dates are not recognised as a liability.
However the amounts of such dividends are disclosed in the ﬁnancial statements.
Segmental reporting
A segment is a distinguishable component of the Group that is engaged either in providing products
or services (business segment) or in providing products or services within a particular economic
environment (geographic segment) which is subject to risks and rewards that are different from those
of other segments.
Financial instruments
Financial assets and ﬁnancial liabilities are recognised on the Consolidated Balance Sheet when the
Group becomes a party to the contractual terms of the instrument.
Held to maturity investments
Held to maturity investments are non-derivative ﬁnancial assets with ﬁxed or determinable payments
and a ﬁxed date of maturity where it is the intention of the Directors to hold them until maturity. Held
to maturity investments are measured subsequent to initial recognition at amortised cost using the
effective interest method. If there is objective evidence that the investment has been impaired, the
ﬁnancial asset is measured at the present value of estimated cash ﬂows. Any changes to the carrying
amount of the investment are recognised in the Consolidated Income Statement.
Notes to the Financial Statements
(continued) 42
Loans and receivables
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost
using the effective interest method, less provision for impairment. A provision for impairment of trade
receivables is established when there is objective evidence that the Group will not be able to collect
all amounts due according to the original terms of the receivables. Signiﬁcant ﬁnancial difﬁculties of
the debtor, probability that the debtor will enter bankruptcy or ﬁnancial reorganisation, and default
or delinquency in payments (more than 60 days overdue) are considered indicators that the trade
receivable is impaired. The amount of the provision is the difference between the asset’s carrying
amount and the present value of estimated future cash ﬂows, discounted at the original effective
interest rate. The carrying amount of the asset is reduced through the use of an allowance account,
and the amount of the loss is recognised in the Consolidated Income Statement within ‘Other
administrative expenses’. When a trade receivable is uncollectible, it is written off against the
allowance account for trade receivables. Subsequent recoveries of amounts previously written off are
credited against 'Other administrative expenses' in the Consolidated Income Statement.
Bank borrowings
Interest bearing bank loans and overdrafts are recorded at fair values on initial recognition. Finance
charges including premiums payable on settlement or redemption and direct issue costs, are
accounted for on an accruals basis to the Consolidated Income Statement using the effective interest
method and are added to the carrying value of the instrument to the extent that they are not settled
in the period in which they arise.
Trade payables
Trade payables are not interest bearing and are initially stated at their fair values and thereafter at
amortised cost.
Equity instruments
Equity instruments issued by the Group are recorded at the proceeds received, net of direct issue
costs.
Equity comprises of the following:
- Share capital - represents the nominal value of equity shares
- Share premium - represents the excess over nominal value of fair value of consideration
- Treasury shares - represents purchase of the Company’s equity share capital, the consideration
paid, including any transaction costs and is deducted from total shareholders' equity
- Shares held by Employee Beneﬁt Trust – represents amounts paid for shares of the Company held
by the Employee Beneﬁt Trust of the Long-Term Incentive Plan
- Retained earnings - represents the accumulated retained proﬁts
- Translation reserve - represents gains or losses on foreign currency differences arising on
consolidation of the net investment in subsidiaries.
Notes to the Financial Statements
(continued) 43
2. SEGMENTAL REPORTING
Segment information is presented in the consolidated ﬁnancial statements in respect of the Group’s
business segments, which are the primary basis of segment reporting. The business segment-
reporting format reﬂects the Group’s management and internal reporting structure.
Primary - Business segments
The Group is organised into ﬁve major business units – Retail Brands, Retail Generics, Hospitals,
Consumer Health Europe (CH E) and, Consumer Health North America (CH NA). Other business units
– Country Distributors, Global Services, Wellbeing Centre, Wellbeing Villages, Resorts and
Management Services – constitute Other Segments. These units form the basis for the Group’s
reporting of primary segment information.
Secondary - Geographical segments
The geographical segments are considered for disclosure as secondary segments. Geographical
revenues are segregated based on the location from which the revenues are generated.
Assets are identiﬁed with the segment on the basis of their place of use.
Segment results
Segment results include items directly attributable to a segment as well as those that can be allocated
on a reasonable basis.
All inter-segment transfers are priced and carried out at arm’s length.
Segment assets and liabilities
Segment assets include all operating assets used by a segment and consist principally of operating
cash, trade and other receivables and property, plant and equipment, net of allowances and provisions
which are reported as direct offsets in the Balance Sheet. Segment liabilities include all operating
liabilities and consist principally of trade and other payables and other liabilities.
Segment assets and liabilities do not include deferred income taxes.
Unallocated segment income and expenses
Unallocated segment income comprises interest income and miscellaneous receipts not directly
attributable to any particular segment. Unallocated segment expenditure represents interest on loans
and provision for income taxes, which cannot be directly attributed to any segment.
Notes to the Financial Statements
(continued) 44
Primary segment disclosure - Business segments
31 March 2009 Retail Retail Other
Brands Generics Hospitals CH E CH NA Segments Total
£’000 £’000 £’000 £’000 £’000 £’000 £’000
Revenue
External sales 43,014 11,497 13,259 16,318 6,622 7,687 98,397
Total revenue 43,014 11,497 13,259 16,318 6,622 7,687 98,397
Result
Segment result 15,773 3,753 3,745 (3,266) (607) 839 20,237
Operating proﬁt 20,237
Finance costs (4)
Finance income 1,096
Income tax expense (7,447)
Proﬁt for the year 13,882
Other information
Segment assets 19,056 3,793 17,545 4,438 2,383 28,743 75,958
Unallocated corporate assets 602
Consolidated total assets 76,560
Segment liabilities 9,766 2,083 665 2,964 710 4,651 20,839
Unallocated corporate liabilities 3,754
Consolidated total liabilities 24,593
Capital expenditure –– 149 – 27 2,155 2,331
Depreciation and amortisation 3,877 – 53 11 21 951 4,913
Impairment losses –– – – – 749 749
Non-cash expenses other
than depreciation –– – – – 309 309
31 March 2008 Retail Retail Other
Brands Generics Hospitals CH E CH NA Segments Total
£’000 £’000 £’000 £’000 £’000 £’000 £’000
Revenue
External sales 36,585 9,251 12,614 13,751 5,103 7,630 84,934
Total revenue 36,585 9,251 12,614 13,751 5,103 7,630 84,934
Result
Segment result 9,604 1,956 1,587 (833) (454) (696) 11,164
Operating proﬁt 11,164
Finance costs (10)
Finance income 1,241
Income tax expense (6,142)
Proﬁt for the year 6,253
Other information
Segment assets 19,604 3,166 15,469 2,971 1,271 23,054 65,535
Unallocated corporate assets 638
Consolidated total assets 66,173
Segment liabilities 7,596 1,768 1,810 1,985 461 7,811 21,431
Unallocated corporate liabilities 5,372
Consolidated total liabilities 26,803
Capital expenditure 84 – 52 – 23 1,086 1,245
Depreciation and amortisation 3,892 – 36 2 23 964 4,917
Impairment losses –– – – – 483 483
Non-cash expenses other
than depreciation –– – – – (102) (102)
Notes to the Financial Statements
(continued)
Notes to the Financial Statements
(continued) 45
Secondary segment disclosure - Geographical segments 2009 2008
£’000 £’000
Revenue
United Kingdom 74,470 63,714
Ireland 15,365 13,880
North America 6,622 5,103
India 1,940 2,237
Total 98,397 84,934
Assets
United Kingdom 38,816 34,837
Ireland 24,691 21,426
North America 2,383 1,271
India 10,670 8,639
Total 76,560 66,173
Capital expenditure
United Kingdom 75 87
Ireland 149 135
North America 27 23
India 2,080 1,000
Total 2,331 1,245
3. OPERATING PROFIT
The operating proﬁt is stated after charging/(crediting):
2009 2008
£’000 £’000
Auditors' remuneration:
- Audit services (see below) 83 80
- Other services (see below) 233 272
Depreciation and amortisation:
- Intangible assets 4,299 4,300
- Property, plant and equipment 614 617
Hire of plant and machinery 53 50
Impairment losses 749 483
Exceptional legal and professional (credit)/costs (2,100) 328
Other operating lease rentals 1,148 1,146
Foreign exchange losses/(gain) 118 (267)
Research and development:
- current year expenditure 672 275
Operating expenses are included in administrative expenses.
Notes to the Financial Statements
(continued) 46
Auditors’ remuneration for audit and non-audit services in jurisdictions in which the Group has a presence are
analysed below:
Group audit 2009 2008
£’000 £’000
Audit fees to Company’s auditor for audit
of the Group’s annual accounts 83 80
83 80
Other services
Audit fees to Company’s auditor and associates for
Company’s subsidiaries pursuant to legislation 126 110
Non-audit
Advisory 50 73
Corporation tax 46 68
VAT 11 21
233 272
4. DIRECTORS AND EMPLOYEES
Employees
Staff costs during the year were as follows: 2009 2008
£’000 £’000
Wages and salaries 9,619 9,414
Social security costs 617 593
Share options 5 (219)
Long-term incentive plan 304 117
Other pension costs 278 236
10,823 10,141
The average number of employees is analysed below: 2009 2008
Number Number
Administration 273 290
Marketing and selling 544 534
Management 70 81
Warehouse 23 25
910 930
The Group contributes to employee money purchase pension schemes at a percentage of pay (depending on grade).
The share option charge/(credit) includes an amount of £nil (2008: £51,000) pertaining to key management
personnel. The long-term incentive plan cost includes £182,000 (2008: £64,000) pertaining to key management
personnel.
Key managements’ remuneration
The key management personnel have been identiﬁed as the Board of Directors.
The emoluments of the Directors were as follows: 2009 2008
£’000 £’000
Emoluments 1,275 1,349
Payments to third parties for consultancy services – 44
Pension contributions to money purchase pension schemes 54 87
Pay in lieu of notice – 313
Compensation for loss of ofﬁce – 576
1,329 2,369
During the year two Directors (2008: four Directors) participated in money purchase pension schemes.
There was no exercise of share options by the Directors during the year (2008: £243,000 gain on excise of share
options).
Further details of the remuneration, share options and long-term incentive plan share awards of the Directors are
given in the Directors’ Remuneration Report on pages 24 to 30.
Notes to the Financial Statements
(continued) 47
5. FINANCE COSTS AND FINANCE INCOME
Finance costs and ﬁnance income includes all interest related income and expenses. The following amounts have
been included in the income statement line for the reporting periods presented:
2009 2008
£’000 £’000
Interest expense resulting from
- corporation tax (2) –
- others (2) (10)
Finance costs (4) (10)
Interest income resulting from
- special interest bearing account 131 568
- short term bank deposits 958 665
- corporation tax 78
Finance income 1,096 1,241
6. INCOME TAX EXPENSE
2009 2008
£’000 £’000
Result for the year before tax 21,329 12,395
Tax rate 28% 30%
Expected tax expense (5,972) (3,719)
Adjustment for non-deductible expenses
- overseas losses not utilised (135) (637)
- overseas proﬁts not taxed 504 677
- amortisation non-deductible (406) (341)
- other non-deductible expenses (1,510) (2,338)
Adjustment to tax charge in respect of prior periods 72 216
Actual tax expense, net (7,447) (6,142)
Comprising
Current tax expense (7,902) (6,181)
Adjustment to tax charges in respect of prior periods 72 216
(7,830) (5,965)
Deferred tax income/(expense) resulting from the 383 (177)
- origination and reversal of temporary difference 383 (141)
Tax rate adjustment for future period – (36)
(7,447) (6,142)
The Group earns its proﬁt in the UK and overseas. The tax rate used for the tax on proﬁt on ordinary activities
reduced to 28% from 30% from 1 April 2008, being the standard rate for UK corporation tax.
Notes to the Financial Statements
(continued) 48
7. INTANGIBLE ASSETS
Brand names
know-how Capital
licences and work in
trade marks Goodwill Software progress Total
£’000 £’000 £’000 £’000 £’000
Cost
At 1 April 2007 64,575 25,437 –– 90,012
Exchange differences 81 1,484 –– 1,565
Additions –– 39 – 39
Disposals (225) –– – (225)
At 31 March 2008 64,431 26,921 39 – 91,391
At 1 April 2008 64,431 26,921 39 – 91,391
Exchange differences 160 6,995 3– 7,158
Additions –– 66 884 950
Disposals – (600) –– (600)
At 31 March 2009 64,591 33,316 108 884 98,899
Amortisation and impairment losses
At 1 April 2007 51,246 17,734 –– 68,980
Exchange differences 81 420 –– 501
Amortisation 4,297 –3 – 4,300
Impairment losses – 237 –– 237
Disposals (43) –– – (43)
At 31 March 2008 55,581 18,391 3– 73,975
At 1 April 2008 55,581 18,391 3– 73,975
Exchange differences 160 5,651 3– 5,814
Amortisation 4,282 – 17 – 4,299
Impairment losses – 486 19 – 505
Disposals – (600) –– (600)
At 31 March 2009 60,023 23,928 42 – 83,993
Carrying amounts
At 1 April 2007 13,329 7,703 –– 21,032
At 31 March 2008 8,850 8,530 36 – 17,416
At 31 March 2009 4,568 9,388 66 884 14,906
Subsequent to the annual impairment test for 2009, the carrying amount of goodwill is allocated to the following
cash generating units:
2009 2008
£’000 £’000
Hospitals 9,388 8,044
Regina Health Limited – 486
9,388 8,530
The recoverable amounts for the cash generating units given above are determined based on internal discounted
cash ﬂow evaluation. The cash ﬂow evaluation is based on actual operating results and ﬁve year forecasts at the
growth rates stated in the key assumptions.
The key assumptions are:
Growth rates 2009 2008
Hospitals Zero Zero
Regina Health Limited – Zero
Notes to the Financial Statements
(continued)
Notes to the Financial Statements
(continued) 49
Discount rates 2009 2008
Hospitals 8% 8%
Regina Health Limited – 8%
Management assumes the Hospitals business units continue to earn the current level of proﬁt margins and achieve
the same level of sales in the future forecasts.
The growth rate for the Hospitals business is assumed to be zero based on past experience.
The discount rate applied for the impairment review workings is based on the Weighted Average Cost of Capital for
the Group.
The Regina Health Limited business has shown a 42% decline in revenue over previous year due to the economic
downturn and reduced sales from one of its major customers which has led to the recognition of the impairment
charge.
The related goodwill impairment loss of £486,000 (2008: £237,000) is included under “Impairment losses” in
the Consolidated Income Statement.
The Directors believe that any reasonably possible change in the key assumptions on which the recoverable amount
are based would not cause the carrying amount to exceed its recoverable amount.
8. PROPERTY, PLANT AND EQUIPMENT
Land & Capital work Ofﬁce Plant & Motor
buildings in progress equipment equipment vehicles Total
£’000 £’000 £’000 £’000 £’000 £’000
Cost
At 1 April 2007 2,384 130 3,270 670 27 6,481
Exchange differences 169 9 135 60 2 375
Additions 236 197 574 199 – 1,206
Disposals –– (67) –– (67)
At 31 March 2008 2,789 336 3,912 929 29 7,995
At 1 April 2008 2,789 336 3,912 929 29 7,995
Exchange differences 203 25 492 105 2 827
Additions 97 11 1,124 149 – 1,381
Transfers 56 (56) –– – –
Disposals (158) – (2,240) (305) – (2,703)
At 31 March 2009 2,987 316 3,288 878 31 7,500
Depreciation and
impairment losses
At 1 April 2007 142 – 2,288 500 12 2,942
Exchange differences 13 – 87 47 1 148
Depreciation 101 – 444 68 4 617
Impairment losses 82 – 163 1– 246
Disposals –– (64) –– (64)
At 31 March 2008 338 – 2,918 616 17 3,889
At 1 April 2008 338 – 2,918 616 17 3,889
Exchange differences 39 – 449 92 2 582
Depreciation 81 – 435 94 4 614
Impairment losses 116 – 123 5– 244
Disposals (158) – (2,176) (298) – (2,632)
At 31 March 2009 416 – 1,749 509 23 2,697
Carrying amounts
At 1 April 2007 2,242 130 982 170 15 3,539
At 31 March 2008 2,451 336 994 313 12 4,106
At 31 March 2009 2,571 316 1,539 369 8 4,803
Land and buildings includes £1,960,000 (2008: £1,774,000) of land which is not being depreciated.
Notes to the Financial Statements
(continued) 50
9. INVENTORIES
2009 2008
£’000 £’000
Finished goods and goods for resale 17,204 14,807
Write down on inventories (2,975) (3,121)
14,229 11,686
In 2009, a total of £30,162,000 of inventories was included in the Consolidated Income Statement as an
expense (2008: £27 ,425,000).
An amount of £1,504,000 for write down of inventories (2008: £1,586,000) has been included within
administrative expenses in the Consolidated Income Statement.
No reversal of previous write-downs was recognised as a reduction of expense in 2009 or 2008. None of the
inventories are pledged as securities for liabilities.
10. TRADE AND OTHER RECEIVABLES
2009 2008
£’000 £’000
Trade receivables 14,258 12,152
Provision for impairment of trade receivables (625) (452)
Trade receivables, net 13,633 11,700
Prepayments and accrued income 925 1,053
Total 14,558 12,753
Trade receivables that are less than 60 days past due are not considered impaired. As of 31 March 2009, trade
receivables of £815,000 (2008: £225,000) were past due but not impaired. These relate to a number of
independent customers for whom there is no recent history of default.
The ageing analysis of these trade receivables is as follows:
2009 2008
£’000 £’000
Up to two months past due 815 225
As of 31 March 2009, trade receivables of £625,000 (2008: £452,000) were impaired and provided for. The
individually impaired receivables mainly relate to wholesalers/distributors, which are in unexpectedly difﬁcult
economic situations. The ageing of these receivables is as follows:
2009 2008
£’000 £’000
Two to six months past due 258 104
Over six months past due 367 348
625 452
The carrying amounts of the Group's trade receivables are denominated in the following currencies:
2009 2008
Currency £’000 £’000
Sterling 9,816 8,082
Euro 2,861 2,197
US Dollar 651 459
Other currencies 305 962
13,633 11,700
Notes to the Financial Statements
(continued) 51
Movements on the Group provision for impairment of trade receivables are as follows: 2009 2008
£’000 £’000
At 1 April 452 836
Provision for receivables impairment 458 187
Receivables written off during the year as uncollectible (10) (471)
Unused amounts reversed (275) (100)
At 31 March 625 452
The creation and release of provisions for impaired receivables have been included in 'Other administrative
expenses' in the Consolidated Income Statement. Amounts charged to the allowance account are generally
written off, when there is no expectation of recovering additional cash.
The other classes within trade and other receivables do not contain impaired assets.
Trade receivables are usually due within 50 days and do not bear any effective interest rate. All trade receivables
except the factored portion of the Retail Generics segment are subject to credit risk exposure. However the Group
does not identify speciﬁc concentration of credit risk with regards to trade receivables, as the amount recognised
consist of a large number of receivables from various customers.
The fair value of these short term ﬁnancial assets is not individually determined as the carrying amount is a
reasonable approximation of fair value.
11. CASH AND CASH EQUIVALENTS
2009 2008
£’000 £’000
Cash at bank and in hand 9,257 6,073
Short-term bank deposits 18,205 13,124
Total 27,462 19,197
The effective interest rate on short-term bank deposits was 5.7% (2008: 6.8%); these deposits have an average
maturity of 68 days (2008: 38 days).
12. SHARE CAPITAL AND SHARE OPTIONS
2009 2008
£’000 £’000
Authorised
100,000,000 ordinary shares of 5 pence each 5,000 5,000
Allotted, called up and fully paid
38,367,046 ordinary shares of 5 pence each 1,919 1,919
2009 2008
Share issued and fully paid: Number Number
- beginning of the year 38,367,046 37,176,033
- issued during the year – 1,191,013
Share issued and fully paid 38,367,046 38,367,046
During the year no shares were issued under the unapproved employee share option scheme, the employee share
save scheme and the long-term incentive plan.
Share options
Details of Directors’ share options are set out in the Directors’ Remuneration Report on page 29.
The market price at 31 March 2009 was 311 pence and the range during the year ended 31 March 2009 was
160.25 pence to 325 pence.
Notes to the Financial Statements
(continued) 52
The following share options which have been granted by the Company were outstanding at the year end:
Date of grant Earliest Latest 2009 2008
date of date of Number Number
exercise exercise
The ‘unapproved scheme’
5p Ordinary shares at 480.5 pence 11 Aug 99 11 Aug 02 10 Aug 09 18,387 18,387
5p Ordinary shares at 260.7 pence 26 Jul 04 26 Jul 09 25 Jul 14 72,491 83,722
5p Ordinary shares at 270 pence 21 Jul 05 21 Jul 10 20 Jul 15 32,875 49,058
The employee ‘sharesave scheme’
5p Ordinary shares at 275.2 pence 2 Jul 02 1 Aug 09 31 Jan 10 6,531 6,531
5p Ordinary shares at 266 pence 10 Jan 03 1 Feb 08 31 Jul 10 – 2,469
5p Ordinary shares at 126 pence 15 Aug 03 1 Sep 08 28 Feb 09 – 2,527
The Directors’ interests (including beneﬁcial and family interests) in the above share options are set out in the
Directors’ Remuneration Report on page 29.
2009 2008
Weighted Weighted
average 2009 average 2008
exercise Number exercise Number
price of price of
Pence options Pence options
Outstanding at the beginning of the period 286.92 162,694 309.73 2,056,478
Lapsed/forfeited/surrendered during the period 255.24 (32,410) 347.81(1,482,771)
Exercised during the period –– 181.39 (411,013)
Outstanding at the end of the period 294.79 130,284 286.92 162,694
Exercisable at the end of the period 480.50 18,387 455.11 20,856
As at 31 March 2009, the Group maintained three sharebased payment schemes:
Goldshield Group plc unapproved scheme
The unapproved share option scheme is administered by the Group. Options are granted to employees during their
tenure of service and these can be exercised until expiry of 10 years from the date of grant, provided
the employee continues to remain in service at the earliest exercise date. The options are exercisable based
on the achievement of performance criteria with regards to growth in earnings per share and turnover. The
Remuneration Committee has the discretion to consider any exception in meeting the performance criteria when
the options are exercised.
Goldshield Group plc sharesave scheme
The scheme allows all eligible employees to beneﬁt from the growth of the Company through savings deducted
directly from pay, tax-free bonuses and a right to purchase Goldshield Group plc shares in the future but at a ﬁxed
price, which does not exceed the middle market value of a share over the three dealing days immediately
preceding the issue of this invitation. The approved sharesave scheme has option exercise terms of 3,5 or 7 years.
The sharesave scheme can be exercised for 6 months only after the 3,5 or 7 year maturity dates.
The options outstanding at 31 March 2009 have an exercise price in the range of 260.7 pence to 480.5 pence
and a weighted average contractual life of 4.64 years.
There were no share options granted during the year.
Goldshield Group plc Long-Term Incentive Plan
Participation in the plan is restricted to employees (including executive Directors) of the Group who are required to
devote substantially the whole of their working time to their duties to the Group. Ordinarily, the Remuneration
Committee selects participants at or before the start of each performance period but the Remuneration Committee
may, in exceptional circumstances, decide to select participants at any time.
As soon as practicable after the start of each performance period, each participant will be notiﬁed about:
• the number of shares awarded to him/her in respect of that period
• the form of the award
• the performance targets to be achieved in relation to the performance period
Notes to the Financial Statements
(continued)
Notes to the Financial Statements
(continued) 53
• the basis upon which the shares may be released after the end of the performance period and
• any other conditions to which the Award may be subject.
Mid market
price at date
At start Awarded in At end of award Date of Date of
of year the year Lapsed Released of year (pence) award vesting
Performance shares 575,982 – (61,499) – 514,483 231 12 Sep 07 12 Sep 10
Performance shares – 811,994 (68,387) – 743,607 253.5 17 Sep 08 12 Sep 11
575,982 811,994 (129,886) – 1,258,090
2009 2008
Number Number
of awards of awards
Outstanding at the beginning of the period 575,982 –
Granted during the period 811,994 708,862
Lapsed during the period (129,886) (132,880)
Outstanding at the end of the period 1,258,090 575,982
13. DEFERRED TAX ASSETS AND LIABILITIES
Defered tax assets and liabilities are attributable to the following:
2009 2009 2008 2008
Deferred Deferred Deferred Deferred
tax assets tax liabilities tax assets tax liabilities
£’000 £’000 £’000 £’000
Intangible assets –1 – 537
Property, plant and equipment 66 – 66 –
Share options 148 – 61 –
Translation reserve – 1,115 – 268
Other liabilities 23 – 104 –
Unused tax losses 365 – 407 –
Total 602 1,116 638 805
Equity
Translation reserve – 847 – 476
Share options –– – –
Total – 847 – 476
Unrecognised deferred taxes
2009 2008
£’000 £’000
US 10,248 6,840
India 3,801 2,314
14,049 9,154
The tax losses for the US subsidiaries expire in 2028 and losses for Indian subsidiaries expire in 2016. Deferred
tax assets against the tax losses have not been recognised to the extent that the realisation of the related tax
beneﬁt through the future taxable proﬁts is not probable.
Please also refer to note 6 for information on the Group’s tax expense.
Notes to the Financial Statements
(continued) 54
Notes to the Financial Statements
(continued)
14. EARNINGS PER SHARE
The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders
divided by the weighted average number of shares in issue during the year, excluding those held by employee
beneﬁt trust and those held as treasury shares.
The calculation of diluted earnings per share is based on the basic earnings per share, adjusted to allow for the
issue of shares and the post tax effect of dividends, on the assumed conversion of all dilutive options.
Reconciliations of the earnings and weighted average number of shares used in the calculations are set out below.
2009 2008
Weighted Weighted
average Per share average Per share
Earnings number of amount Earnings number of amount
£’000 shares’000 pence £’000 shares ’000 pence
Proﬁt attributable to shareholders 13,882 34,989 – 6,253 36,915 –
Basic earnings per share 39.7 16.9
Diluted earnings per share 34,989 39.7 36,916 16.9
Weighted average number of ordinary shares 2009 2008
shares shares
000’s 000’s
Issued ordinary share at 1 April 35,203 37,176
Weighted average number of shares issued during the year – 593
Weighted average number of treasury shares (214) (725)
Weighted average number of shares
held by employee beneﬁt trust – (129)
Weighted average number of ordinary share at 31 March 34,989 36,915
Weighted average number of ordinary shares (diluted)
Weighted average number of ordinary shares at 31 March 34,989 36,915
Effect of share options on issue –1
Weighted average number of ordinary shares (diluted) at 31 March 34,989 36,916
15. EQUITY DIVIDENDS
2009 2008
£’000 £’000
Ordinary shares – dividend for 2007 of 5.1 pence
per share paid 20 August 2007 – 1,896
Ordinary shares – dividend for 2007 of 2.5 pence
per share paid 10 January 2008 – 921
Ordinary shares – dividend for 2008 of 5.5 pence
per share paid 20 August 2008 1,936 –
Ordinary shares – dividend for 2009 of 2.9 pence
per share paid 8 January 2009 1,012 –
2,948 2,817
2009 2008
Pence Pence
Proposed dividend per share 5.8 5.5
2009 2008
£’000 £’000
Proposed dividend 2,023 1,936 55
16. STATEMENT OF CHANGES IN EQUITY
Equity attributable to equity holders of
Goldshield Group plc
Share Share Own Translation Retained Total
capital premium shares reserve earnings equity
£’000 £’000 £’000 £’000 £’000 £’000
Balance 1 April 2007 1,859 21,549 – (484) 17,758 40,682
Currency translation differences ––– 1,651 – 1,651
Deferred tax on translation reserve ––– (476) – (476)
Net income recognised
directly in equity ––– 1,175 – 1,175
Proﬁt for the year –––– 6,253 6,253
Total recognised income
for the year ––– 1,175 6,253 7,428
Shares issued 60 725 –– – 785
Purchase of shares held by
employee beneﬁt trust –– (1,939) –– (1,939)
Purchase of treasury shares –– (4,667) –– (4,667)
Employee share based compensation –––– (102) (102)
Dividends paid –––– (2,817) (2,817)
Balance at 31 March 2008 1,919 22,274 (6,606) 691 21,092 39,370
Balance 1 April 2008 1,919 22,274 (6,606) 691 21,092 39,370
Currency translation differences ––– 3,024 – 3,024
Deferred tax on translation reserve ––– (847) – (847)
Net income recognised
directly in equity ––– 2,177 – 2,177
Proﬁt for the year –––– 13,882 13,882
Total recognised income
for the year ––– 2,177 13,882 16,059
Purchase of shares held by
employee beneﬁt trust –– (823) –– (823)
Employee share based compensation –––– 309 309
Dividends paid –––– (2,948) (2,948)
Balance at 31 March 2009 1,919 22,274 (7,429) 2,868 32,335 51,967
Notes to the Financial Statements
(continued) 56
17. PROVISIONS
£’000
Carrying amount 1 April 2008 3,335
Used during the year (1,235)
Unused amount released (2,100)
Carrying amount 31 March 2009 –
The carrying value of provisions at 1 April 2008 represented estimated legal fees of the costs for defending Serious
Fraud Ofﬁce litigation against the Group. However with the judgement of the litigation being in favour of the Group,
the balance unused amount was released during the year.
18. TRADE AND OTHER PAYABLES
2009 2008
£’000 £’000
Trade payables 6,429 5,516
Accruals 12,999 11,458
19,428 16,974
19. OTHER LIABILITIES
2009 2008
£’000 £’000
Other creditors 531 490
Social security and other taxes 880 632
1,411 1,122
20. OPERATING LEASES
The Group’s minimum operating lease payments are as follows:
2009 2008
Land & 2009 Land & 2008
buildings Other buildings Other
£’000 £’000 £’000 £’000
Within one year 953 14 712 14
Between one to ﬁve years 1,277 14 1,116 28
More than ﬁve years 1,167 – 1,346 –
3,397 28 3,174 42
Lease payments recognised as an expense during the period amount to £1,148,000 (2008: £1,146,000). No
sublease income is expected as all assets held under lease agreements are used exclusively by the Group.
No operating lease agreements contain any contingent rent clauses.
The ofﬁce building in India has a renewal option and escalation clause for lease rentals. Apart from the India
ofﬁce building at Mumbai, none of the operating lease agreements contain renewal options or escalation clauses.
The Group did not have any ﬁnancial leases at 31 March 2009 (2008: £nil).
Notes to the Financial Statements
(continued) 57
21. HELD-TO-MATURITY FINANCIAL ASSETS
Held-to-maturity ﬁnancial assets comprise of a secured non-convertible debenture. The redemption date was 14
months from the date of investment. The interest period was the period starting from the allotment date to the
redemption and maturity date. The debenture was redeemed in 2009.
The cost and fair values of this ﬁnancial assets was as follows:
2009 2008
£’000 £’000
Carrying amounts at amortised cost:
Secured non-convertible debenture – 377
– 377
Estimated fair values:
Secured non-convertible debenture – 377
– 377
22. FINANCIAL INSTRUMENTS
The Group uses ﬁnancial instruments, comprising cash, short term borrowings, trade receivables and trade
payables, which arise directly from its operations. The main purpose of these ﬁnancial instruments is to raise
ﬁnance for the Group’s operations.
Capital management
The Groups capital management objectives are to ensure that the entities in the Group will be able to continue
as a going concern whilst maximising the return to shareholders. The Group currently has no debt.
Short term payables and receivables
The Group’s trade and other receivables are actively monitored to avoid signiﬁcant concentrations of credit risk.
Interest rate risk
The Group ﬁnances its operations through a mixture of retained proﬁts and bank facilities. Bank borrowings are
made using variable interest rates.
Liquidity risk
The Group seeks to manage ﬁnancial risk, to ensure sufﬁcient liquidity is available to meet foreseeable needs
and to invest cash assets safely and proﬁtably.
Short-term ﬂexibility is achieved through overdraft facilities and short/medium term borrowings.
Borrowing facilities
The Group has undrawn facilities available of £500,000 expiring within one year (2008: £500,000).
Currency risk
The Group is exposed to translation and transaction foreign exchange risk. In relation to translation risk the
proportion of assets held in the foreign currency are matched to an appropriate level of borrowings in the same
currency. Transaction exposures are hedged when known, mainly using the forward exchange hedge market.
The Group seeks to hedge its exposures using a variety of ﬁnancial instruments, with the objective of minimising
the impact of ﬂuctuations in exchange rates on future transactions and cash ﬂows.
The Group has overseas subsidiaries operating in Ireland where reserves and expenses are denominated in Euros.
£22.8 million (2008: £20.8 million) of the sales of the Group’s business is to customers in continental
Europe/foreign markets excluding North American operations. The majority of these sales are invoiced in the
currencies of the customers involved. The Group policy is to minimise all currency exposures on any balance not
expected to mature within 30 days of its arising through the use of forward currency contracts, however there were
none in place at the year end. All other sales of UK business are denominated in sterling.
Notes to the Financial Statements
(continued) The tables below show the extent to which Group companies have monetary assets and liabilities in currencies
other than their local currency.
Functional currency of operation Net foreign currency monetary assets/(liabilities)
Indian Other
US Dollars Euro Rupees currencies Total
£’000 £’000 £’000 £’000 £’000
2009
Sterling 162 1,835 (31) 752 2,718
US Dollar 1,434 –– – 1,434
Euro 493 96 – (28) 561
Indian Rupees –– 3,313 – 3,313
2,089 1,931 3,282 724 8,026
2008
Sterling 172 2,417 (168) 1,263 3,684
US Dollar 658 –– – 658
Euro 544 –1 – 545
Indian Rupees –– 3,133 – 3,133
1,374 2,417 2,966 1,263 8,020
Fair values
The fair values of the Group’s ﬁnancial instruments are considered equal to the book value. As these ﬁnancial
instruments are not publicly traded, the fair values presented are determined by calculating present values of the
cash ﬂows anticipated until maturity of these ﬁnancial assets.
2009
Held to maturity Loans
Assets as per balance sheet investments and receivables Total
£’000 £’000 £’000
Trade and other receivables – 14,558 14,558
Cash and cash equivalents – 27,462 27,462
– 42,020 42,020
2008
Held to maturity Loans
Assets as per balance sheet investments and receivables Total
£’000 £’000 £’000
Held to maturity investments 377 – 377
Trade and other receivables – 12,753 12,753
Cash and cash equivalents – 19,197 19,197
377 31,950 32,327
2009 Liabilities at fair
value through the
Liabilities as per balance sheet proﬁt and loss Total
£’000 £’000
Trade and other payables 19,428 19,428
Other liabilities 1,411 1,411
20,839 20,839
2008 Liabilities at fair
value through the
Liabilities as per balance sheet proﬁt and loss Total
£’000 £’000
Trade and other payables 16,974 16,974
Other liabilities 1,122 1,122
18,096 18,096
58
Notes to the Financial Statements
(continued) 59
23. CAPITAL COMMITMENTS
During the year ended 31 March 2009, the Group entered into contracts to purchase property, plant and
equipment and implement Enterprise Resource Planning software for £644,000 (2008: £234,000). These
commitments are expected to be settled in the following ﬁnancial year.
24. SUBSIDIARY UNDERTAKINGS
At 31 March 2009 the Company held more than 20% of the allotted share capital of the following signiﬁcant
undertakings:
Name Country of Class of share Proportion Nature of
registration or capital held held business
incorporation
Goldshield Pharmaceuticals Limited England and Wales £1 ordinary shares 100% Marketing and distribution of
pharmaceutical products
Goldshield Limited England and Wales £1 ordinary shares 100% Marketing and distribution of
vitamins and health supplements
Goldshield Management Services Limited England and Wales £1 ordinary shares 100% Management services
Vitamins Direct Limited England and Wales £1 ordinary shares 100% Marketing and distribution of
vitamins and health supplements
Regina Health Limited England and Wales £1 ordinary shares 100% Marketing and distribution of
vitamins and health supplements
B&S House of Health Limited England and Wales £1 ordinary shares 100% Marketing and distribution of
vitamins and health supplements
Natural Essentials Limited England and Wales £1 ordinary shares 100% Marketing and distribution of
vitamins and health supplements
Forley Generics Limited England and Wales £1 ordinary shares 100% Marketing of pharmaceutical
products
Goldshield USA, Inc USA Ordinary shares 100% Intermediate holding company
Golden Pride, Inc USA Ordinary shares 100% Marketing and distribution of
vitamins and health supplements
WT Rawleigh, Co Canada Ordinary shares 100% Marketing and distribution of
vitamins and health supplements
Goldshield Services Pvt. Limited India Ordinary shares 100% Management services
Antigen Pharmaceuticals Limited Ireland Ordinary shares 100% Intermediate holding company
Antigen International Limited Ireland Ordinary shares 100% Marketing and distribution of
pharmaceutical products
Antigen Overseas Limited Ireland Ordinary shares 100% Marketing and distribution of
pharmaceutical products
Anpharm Limited Ireland Ordinary shares 100% Marketing and distribution of
pharmaceutical products
Goldshield Healthcare Pvt. Limited India Ordinary shares 100% Marketing and distribution of
vitamins and health supplements
and telemarketing services
Goldshield Real Estate Pvt. Limited India Ordinary shares 100% Development of Wellbeing Villages
and Resorts
Complete Wellbeing Publishing Pvt. Limited India Ordinary shares 100% Publishing magazines for
consumers and selling copies,
subscriptions and advertising space
Goldshield Direct,Inc. USA Ordinary shares 100% Marketing and distribution of
vitamins and health supplements
Goldshield Management Services, Inc. USA Ordinary shares 100% Management services
Notes to the Financial Statements
(continued) 25. CONTINGENT LIABILITIES
Indemnities and guarantees
The Group has given indemnities in respect of advance payments, deferred purchase consideration and import duty
guarantees issued on its behalf in the normal course of business. The indemnities given at 31 March 2009
amounted to £688,000 (2008: £707,000).
26. ACCOUNTING ESTIMATES AND JUDGEMENTS
Estimates and judgments are continually evaluated and are based on historical experience and
other factors, including expectations of future events that are believed to be reasonable under the circumstances.
The Group makes estimates and judgements concerning the future. The estimates and judgements that have a
signiﬁcant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next
ﬁnancial year are discussed below.
Impairment of goodwill and other intangibles
The Group test annually the carrying values of goodwill and other intangibles for impairment in accordance with
the accounting policy statement in Note 1. The achievement of the growth and proﬁtability by the individual cash
generating units is critical in substantiating the carrying value of goodwill and intangibles. Refer to note 7 of
Consolidated Financial Statements on page 48.
Share options
The share options calculation takes into account future dividends of 6 pence and a volatility rate of 45%, based on
expected share price. It is assumed that the 3 and 5 year share save options are held for 3 and 5 years respectively,
ie. the duration of the savings contracts, because the bonus is paid then and the employee has cash tied up. For
the employee stock options it is assumed that 3 year options will be held for 5 years and that 5 year options will
be held for 6 years. Both could be held for longer before expiry, but on average employees are likely to seek liquidity
or leave the Company before the full term. The risk-free interest rate was determined at 5%. The underlying
expected volatility was based upon a calculation of historic volatility during the period 2002-2004.
Long-Term Incentive Plan
The costs for Long-term incentive plan share rewards were calculated using the Binomial model with the
following assumptions:
Date of award 12 Sep 07 12 Sep 07 17 Sep 08 17 Sep 08
Performance criteria TSR EPS TSR EPS
Number of shares issued under the scheme 354,431 354,431 405,997 405,997
Share price (£) (mid market) £2.31 £2.31 £2.535 £2.535
Option exercise price (£) £0.00 £0.00 £0.00 £0.00
Expected life of awards in years 33 3 3
Volatility 30% 30% 36% 36%
Dividend yield 2.5% 2.5% 3.2% 3.2%
Risk free interest rate 5% 5% 3.5% 3.5%
Binomial model £ fair value £1.39 £2.31 £1.01 £2.535
Income taxes
The Group is subject to taxes in various jurisdictions. Signiﬁcant judgment is required in determining the Group
provision for income taxes. There are many transactions and calculations for which the ultimate tax determination
is uncertain during the ordinary course of business. The Group recognises liabilities for anticipated tax audit issues
based on estimates as to whether additional taxes will be due. Where the ﬁnal tax outcome of these matters is
different from the amounts that were initially recorded, such differences will impact the income tax and deferred
tax provision in the year in which such determination is made.
60
Notes to the Financial Statements
(continued) 61
We have audited the parent Company ﬁnancial statements of Goldshield Group plc for the year ended
31 March 2009 which comprise the Balance Sheet and notes 1 to 13. These parent Company ﬁnancial
statements have been prepared under the accounting policies set out therein. We have also audited the
information in the Directors’ Remuneration Report that is described as having been audited.
We have reported separately on the consolidated ﬁnancial statements of Goldshield Group plc for the
year ended 31 March 2009.
This report is made solely to the Company’s members, 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 members those matters we are required to state to them in an auditor’s report and for no
other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to
anyone other than the Company and the Company’s members as a body for our audit work, for this
report, or for the opinions we have formed.
Respective responsibilities of directors and auditor
The Directors’ responsibilities for preparing the Annual Report, the Directors’ Remuneration Report and
the parent Company ﬁnancial statements in accordance with United Kingdom law and United Kingdom
Accounting Standards (United Kingdom Generally Accepted Accounting Practice) are set out in the
Statement of Directors’ Responsibilities.
Our responsibility is to audit the parent Company ﬁnancial statements and the part of the Directors’
Remuneration Report to be audited in accordance with relevant legal and regulatory requirements and
International Standards on Auditing (UK and Ireland).
We report to you our opinion as to whether the parent Company ﬁnancial statements give a true and
fair view and whether the parent Company ﬁnancial statements and the part of the Directors’
Remuneration Report to be audited have been properly prepared in accordance with the Companies
Act 1985. We also report to you whether in our opinion the information given in the Directors’ Report
is consistent with the parent Company ﬁnancial statements.
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 parent Company ﬁnancial statements. The other information comprises only the Directors,
Secretary and Advisors, Financial Highlights, Chairman's Overview, Chief Executive Ofﬁcer’s
Operating Review, Report of the Chief Financial Ofﬁcer, Five Year Review, Directors, Report of the
Directors, Corporate Governance Report, Corporate Social Responsibility and the unaudited part of
the Directors' Remuneration Report. We consider the implications for our report if we become aware of
any apparent misstatements or material inconsistencies with the parent Company ﬁnancial statements.
Our responsibilities do not extend to any other information.
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 examination, on a test basis, of evidence
relevant to the amounts and disclosures in the parent Company ﬁnancial statements and the part of
the Directors’ Remuneration Report to be audited. It also includes an assessment of the signiﬁcant
estimates and judgments made by the Directors in the preparation of the parent Company ﬁnancial
statements, and of whether the accounting policies are appropriate to the Company’s circumstances,
consistently applied and adequately disclosed.
Report of the Independent Auditor to the
Members of Goldshield Group plc 62
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 parent Company ﬁnancial statements and the part of the Directors’ Remuneration Report to be
audited 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
parent Company ﬁnancial statements and the part of the Directors’ Remuneration Report to be
audited.
Opinion
In our opinion:
•
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;
• the parent Company ﬁnancial statements and the part of the Directors’ Remuneration Report
to be audited have been properly prepared in accordance with the Companies Act 1985; and
• the information given in the Directors’ Report is consistent with the ﬁnancial statements.
GRANT THORNTON UK LLP
REGISTERED AUDITOR
CHARTERED ACCOUNTANTS
LONDON
24 JUNE 2009
Report of the Independent Auditor to the
Members of Goldshield Group plc
(continued) 63
Notes 2009 2008
£’000 £’000
Fixed assets
Intangible assets 5 4,568 8,851
Investments 6 6,213 7,159
10,781 16,010
Current assets
Debtors: due after more than one year 7 3,489 4,521
Debtors: due within one year 7 13,472 4,779
Cash at bank and in hand 16,107 11,234
33,068 20,534
Creditors: amounts falling due within one year 8 (1,593) (2,438)
Net current assets 31,475 18,096
Total assets less current liabilities 42,256 34,106
Provisions for liabilities 9 (1) (537)
42,255 33,569
Capital and reserves
Called up share capital 10 1,919 1,919
Share premium account 11 22,274 22,274
Treasury shares (4,667) (4,667)
Shares held by employee beneﬁt trust (2,762) (1,939)
Proﬁt and loss account 11 25,491 15,982
Shareholders’ funds 12 42,255 33,569
The ﬁnancial statements were approved by the Board of Directors on 24 June 2009 and signed on their behalf by:
Rakesh V Patel, Chief Executive Ofﬁcer
Ram Swamy, Chief Financial Ofﬁcer
The accompanying accounting policies and notes form an integral part of these ﬁnancial statements.
Company Balance Sheet at 31 March 2009 1. PRINCIPAL ACCOUNTING POLICIES
Basis of preparation
The ﬁnancial statements have been prepared in accordance with applicable United Kingdom accounting standards
and under the historical cost convention. The Directors have reviewed the principal accounting policies and
consider they remain the most appropriate for the Company. The principal accounting policies of the Company
have remained unchanged from the previous year.
Investments
Investments in subsidiary undertakings in the balance sheet of the Company are included at the cost of the
shares held less amounts written off.
Intangible ﬁxed assets
Goodwill, brand names, know-how, licences, trademarks and similar intangible items are capitalised at historical
cost net of any provision for impairment and amortised on a straight line basis over their estimated useful
economic lives, which range between seven and ten years.
Deferred taxation
Deferred tax is recognised on all timing differences where the transactions or events that give the Group an
obligation to pay more tax in the future, or a right to pay less tax in the future have occurred by the balance sheet
date. Deferred tax assets are recognised when it is more likely than not that they will be recovered. Deferred tax
is measured using rates of tax that have been enacted or substantially enacted by the balance sheet date.
Deferred taxes are not discounted.
Foreign currencies
Transactions in foreign currencies are translated at the exchange rate ruling at the date of the transaction. Monetary
assets and liabilities in foreign currencies are translated at the rates of exchange ruling at the balance sheet date.
All other exchange differences are dealt with through the proﬁt and loss account.
Financial instruments
Financial assets and ﬁnancial liabilities are recognised on the Company’s balance sheet when the Company
becomes a party to the contractual terms of the instrument.
•
Trade receivables
Trade receivables do not carry any interest and are stated at their fair values, which equal the estimated present
value of the future cash ﬂows.
•
Bank borrowings
Interest bearing bank loans and overdrafts are recorded at fair value. Finance charges, including premiums payable
on settlement or redemption and direct issue costs, are accounted for on an accruals basis to the proﬁt and loss
account using the effective interest method and are added to the carrying value of instrument to the extent that
they are not settled in the period in which they arise.
•
Trade payables
Trade payables are not interest bearing and are stated at their fair value.
Share options and long-term share incentive plan
The share options and the long-term share incentive plan is available to eligible employees who are employed by
other subsidiaries of the Company.
64
Notes to the Company’s Financial Statements 65
Notes to the Company’s Financial Statements
(continued)
2. RESULT FOR THE FINANCIAL YEAR
The Company has taken advantage of Section 230 of the Companies Act 1985 and has not included its own proﬁt
and loss account in these ﬁnancial statements. The proﬁt after tax for the year of the Company was £12,457,000
(2008: £7,782,000) which is dealt with in the ﬁnancial statements of the Company.
Auditors’ remuneration
The audit fee for the Company was £6,000 (2008: £6,000). Auditors’ remuneration for other services is disclosed
in note 3 of Consolidated IFRS ﬁnancial statements on page 45.
Fees paid to Company’s auditor, Grant Thornton UK LLP , and its associates for services other than statutory audit of
the Company are not disclosed in Goldshield Group plc’s ﬁnancial statements since the consolidated ﬁnancial
statements of Goldshield Group plc are required to disclose non-audit fees on a consolidated basis.
3. DIRECTORS AND EMPLOYEES
There were no employees in the Company as at 31 March 2009 and 31 March 2008.
Details in respect of Directors’ emoluments are included within the Directors’ Remuneration Report on page 28.
4. EQUITY DIVIDENDS
2009 2008
£’000 £’000
Ordinary shares – dividend for 2007 of 5.1 pence per share paid on 20 August 2007 – 1,896
Ordinary shares – dividend for 2007 of 2.5 pence per share paid on 10 January 2008 – 921
Ordinary shares – dividend for 2008 of 5.5 pence per share paid on 20 August 2008 1,936 –
Ordinary shares – dividend for 2009 of 2.9 pence per share paid on 8 January 2009 1,012 –
2,948 2,817
2009 2008
Pence Pence
Proposed dividend per share 5.8 5.5
2009 2008
£’000 £’000
Proposed dividend 2,023 1,936
5. INTANGIBLE FIXED ASSETS
Brand names
know-how
licences and
trade marks Goodwill Total
£’000 £’000 £’000
Cost
At 1 April 2008 48,669 14,605 63,274
At 31 March 2009 48,669 14,605 63,274
Amortisation and impairment losses
At 1 April 2008 40,273 14,150 54,423
Amortisation 3,929 354 4,283
At 31 March 2009 44,202 14,504 58,706
Carrying amounts
At 31 March 2009 4,467 101 4,568
At 31 March 2008 8,396 455 8,851
The Board has considered the useful economic life for signiﬁcant acquisitions and concluded in each case that the
useful economic life ranges between seven and ten years. 66
6. FIXED ASSET INVESTMENTS
2009 2008
£’000 £’000
Investments in Group undertakings at cost 6,213 7,159
2009
Cost £’000
At 1 April 2008 7,159
Additions 1,275
At 31 March 2009 8,434
Amounts written off in year ended 31 March 2009 (2,221)
Net book amount at 31 March 2009 6,213
Shares in subsidiary undertakings
Refer Note 24 of Consolidated ﬁnancial statements on Page 59.
7. DEBTORS
Debtors due after more than one year 2009 2008
£’000 £’000
Amounts owing by subsidiary undertakings 3,489 4,521
Debtors due within one year
Other debtors – 84
Social security and other taxes 34 –
Amounts owing by subsidiary undertakings 13,388 4,635
Prepayments and accrued income 50 60
13,472 4,779
8. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
2009 2008
£’000 £’000
Current taxation 1,248 1,919
Social security and other taxes – 183
Other creditors 339 336
Accruals 6–
1,593 2,438
9. PROVISIONS FOR LIABILITIES
2009 2008
£’000 £’000
Deferred taxation 1 537
Deferred taxation provided for in the ﬁnancial statements is set out below:
Accelerated capital allowances 1 537
Total 1 537
At 1 April 2008 537 1,117
Movement in the year (536) (580)
At 31 March 2009 1 537
Notes to the Company’s Financial Statements
(continued) 67
10. CALLED UP SHARE CAPITAL
2009 2008
£’000 £’000
Authorised
100,000,000 ordinary shares of 5 pence each 5,000 5,000
2009 2008
£’000 £’000
Allotted, called up and fully paid
38,367,046 ordinary shares of 5 pence each 1,919 1,919
There were no shares issued during the year ended 31 March 2009.
Share options and long-term share incentive plan
Refer Note 12 of the Consolidated ﬁnancial statements on pages 51 to 53.
11. SHARE PREMIUM ACCOUNT AND PROFIT AND LOSS ACCOUNT
Proﬁt Share
& loss premium
account account
£’000 £’000
At 1 April 2008 15,982 22,274
Equity dividends paid (2,948) –
Retained proﬁt for the year 12,457 –
At 31 March 2009 25,491 22,274
12. RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS’ FUNDS
2009 2008
£’000 £’000
Proﬁt for the ﬁnancial year after taxation 12,457 7,782
Equity dividends paid (2,948) (2,817)
Issue of shares – 785
Purchase of treasury shares – (4,667)
Purchase of shares held by employee beneﬁt trust (823) (1,939)
Net increase/(decrease) in shareholders’ funds 8,686 (856)
Shareholders’ funds at 1 April 2008 33,569 34,425
Shareholders’ funds at 31 March 2009 42,255 33,569
13. CONTINGENT LIABILITIES
The Company together with a number of other Companies in the Group have entered into an all sums cross
guarantee with one of the Group’s bankers. The total borrowing to which this guarantee related amounted to £nil
at 31 March 2009 (2008: £nil).
Notes to the Company’s Financial Statements
(continued) 68
Notice is hereby given that the Annual General Meeting of Goldshield Group plc will be held at Panmure
Gordon, 155 Moorgate, London EC2M 6XB on 5 August 2009 at 10.00 am when the following business will
be transacted:
Report and accounts
1. To receive the accounts and report of the Directors and auditor for the year ended 31 March 2009.
Appointment of Directors
2. To re-appoint Rakesh V Patel, retiring by rotation, in accordance with Article 100 of the Company’s Articles
of Association, as a Director of the Company.
3. To re-appoint Ajay M Patel, retiring by rotation, in accordance with Article 100 of the Company’s Articles of
Association, as a Director of the Company.
4. To re-appoint Ram Swamy, who was appointed by the Board on 6 August 2008, in accordance with Article
106 of the Company’s Articles of Association, as a Director of the Company.
Auditor
5. To re-appoint Grant Thornton UK LLP as auditor to the Company and to authorise the Directors to ﬁx their
remuneration.
Dividend
6. To declare a dividend of 5.8 pence per Ordinary Share.
Directors’ Remuneration Report
7. To receive and approve the Directors’ Remuneration Report for the year ended 31 March 2009.
Ordinary resolution
8. To consider and, if thought ﬁt, to pass the following resolution, as an ordinary resolution:
That the Directors be and are generally and unconditionally authorised in connection with Section 80 of the
Companies Act 1985 (the “Act”) to allot relevant securities (as deﬁned in Section 80(2) of the Act) (in
substitution for and to the exclusion of any other power previously granted to the Directors of the Company
pursuant to Section 80 of the Act) to an aggregate nominal amount of £581,378 such authority to expire at
the conclusion of 15 months from the date of the passing of the Resolution or, if earlier, the Annual General
Meeting of the Company to be held in 2010 save that the Company may before such expiry make an offer or
agreement which would or might require relevant securities to be allotted after such expiry and the Directors
may allot relevant securities pursuant to such an offer or agreement as if the authority granted by this
Resolution had not expired provided that nothing in this Resolution shall render unauthorised any act done or
allotment of any relevant securities, or any offer or agreement which would or might require relevant securities
to be allotted and made prior to the passing of this Resolution pursuant to any prior authority.
Special resolution
9. To consider and, if thought ﬁt, to pass the following resolution, as a special resolution:-
That, subject to the Resolution set out at item 8 in this notice being duly passed, the Directors be and are
hereby empowered pursuant to Section 95 of the Companies Act 1985 (the "Act") to allot equity securities
(as deﬁned in Section 94(2) of the Act), which are to be paid up in cash, as if Section 89(1) of the Act did
not apply to such allotment, provided that this power shall be limited to:
(a) the allotment of equity securities in connection with an offer by way of rights or other preemptive offer in favour
of the holders of Ordinary Shares and others entitled to participate in such offer where the equity securities
respectively attributable to the interests of ordinary shareholders and others so entitled are proportionate (as
nearly as may be) to the respective number of Ordinary Shares held or deemed to be held by them, subject
only to such exclusions or other arrangements as the Directors deem necessary or expedient to deal with
fractional entitlements, legal or practical problems arising in any overseas territory or the equipment of any
regulatory body or stock exchange, or any other matter whatsoever; and
Notice of Annual General Meeting 69
(b) the allotment (otherwise than pursuant to paragraph (a) above) of equity securities up to an aggregate
nominal amount of £87,207. Such power to be in substitution for and to the exclusion of any other power
previously granted to the Directors of the Company pursuant to Section 95 of the Act, provided that nothing
in this resolution shall render unauthorised or otherwise affect any act done or allotment of equity securities
or any offer or agreement which would or might require equity securities to be allotted, made prior to the
passing of this resolution pursuant to any prior power (and any such prior power shall remain in full force
and effect in relation to any allotment pursuant to or arising out of any offer or agreement as aforesaid) and
the power conferred by this resolution (unless previously varied or revoked by a Special Resolution of the
Company) shall expire at the conclusion of the Annual General Meeting of the Company to be held in 2010
or 15 months after the passing of this resolution whichever is earlier but so that the power conferred by this
resolution shall allow the Company to make before expiry of this power offers or agreements which would
or might require equity securities to be allotted after such expiry and notwithstanding such expiry the
Directors may allot equity securities in pursuance of such offers or agreements.
Special resolution
10. To consider and, if thought ﬁt, to pass the following resolution, as a special resolution:
That the Company be and is hereby generally and unconditionally authorised for the purpose of Section 166
of the Companies Act 1985 (the "Act") to make one or more market purchases (within the meaning of
Section 163(3) of the Act) on the Ofﬁcial List of the UK Listing Authority of Ordinary Shares of 5 pence
each in the capital of the Company ("Ordinary Shares") provided that:
(a) the maximum aggregate number of Ordinary Shares hereby authorised to be purchased is 3,488,271
(representing approximately 10 per cent of the Company’s issued Ordinary share capital as at 19 June
2009);
(b) the minimum price which may be paid for such Ordinary Shares is 5 pence per share (exclusive of
expenses);
(c) the maximum price (exclusive of expenses) which may be paid for an Ordinary Share shall be not more than
5 per cent above the average of the market values for an Ordinary Share as derived from the London Stock
Exchange Daily Ofﬁcial List for the ﬁve business days immediately preceding the date on which the Ordinary
Share is purchased;
(d) unless previously renewed, varied or revoked, the authority hereby conferred shall expire at the conclusion
of the next Annual General Meeting of the Company to be held in 2010 or within 15 months from the date
of passing of this resolution, whichever shall be the earlier; and
(e) the Company may make a contract or contracts to purchase Ordinary Shares under the authority hereby
conferred prior to the expiry of such authority which will or may be executed wholly or partly after the expiry
of such authority and may make a purchase of Ordinary Shares in pursuance of any such contract or
contracts.
Special resolution
11. To consider and, if thought ﬁt, to pass the following resolution, as a special resolution:
That a general meeting other than an annual general meeting or a meeting convened to pass a special
resolution may be called on not less than 14 clear days’ notice.
By Order of the Board
S Venkateswaran
Secretary, 24 June 2009
Registered Ofﬁce: Bensham House, 324 Bensham Lane, Thornton Heath, Surrey CR7 7EQ
Registered in England & Wales under Company Number 2330913
Notice of Annual General Meeting
(continued) 70
Notice of Annual General Meeting
(continued)
NOTES
1. Only holders of Ordinary Shares or their duly appointed representatives are entitled to attend and vote at
the meeting. Members so entitled may appoint one or more persons to attend and (on a poll) vote on their
behalf. A proxy need not be a member of the Company.
2. A form of proxy is enclosed for use in connection with the business set out above. To be valid, the form of
proxy and any power of attorney or other authority under which it is signed must be lodged with the Company’s
Registrars, Capita Registrars, The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU, not less than
48 hours before the time appointed for holding the General Meeting or adjournment as the case may be. You
can only appoint a proxy using the procedures set out in these notes and the notes to the proxy form.
3. Completion and return of a form of proxy does not preclude a member from attending and voting at the meeting.
4. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment
service may do so by using the procedures described in the CREST Manual. CREST personal members or other
CREST sponsored members and those CREST members who have appointed voting service provider(s), should
refer to their CREST sponsor or voting service provider(s) who will be able to take the appropriate action on
their behalf.
In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate
CREST message (a "CREST Proxy Instruction") must be properly authenticated in accordance with Euroclear
UK & Ireland Limited's (formerly CRESTCo's) speciﬁcations and must contain the information required for
such instructions, as described in the CREST Manual. The message, regardless of whether it constitutes the
appointment of a proxy or an amendment to the instruction given to a previously appointed proxy, must in
order to be valid, be transmitted so as to be received by Capita Registrars (ID RA 10) by no later than 10.00
am on 3 August 2009. No such message received through the CREST network after this time will be
accepted. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp
applied to the message by the CREST Applications Host) from which the registrars are able to retrieve the
message by enquiry to CREST in the manner prescribed by CREST . After this time, any change of instructions
to proxies appointed through CREST should be communicated to the appointee through other means.
CREST members and, where applicable, their CREST sponsors or voting service provider(s) should note that
Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular
message. Normal system timings and limitations will therefore apply in relation to the input of CREST Proxy
Instructions. Is it the responsibility of the CREST member concerned to take (or, if the CREST member is a
CREST personal member or sponsored member or has appointed a voting service provider(s), to procure that
his CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a
message is transmitted by means of the CREST system by any particular time. In this connection, CREST
members and, where applicable, their CREST sponsors or voting service providers are referred, in particular,
to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.
The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation
35(5)(a) of the Uncertiﬁcated Securities Regulations 2001.
5. Copies of all Directors’ service contracts will be available for inspection at the principal business address of
the Company, No.1 Croydon, 12-16 Addiscombe Road, Croydon, Surrey CR0 0XT , during normal business
hours on each business day (Saturdays, Sundays and public holidays excluded) and at Panmure Gordon,
155 Moorgate, London EC2M 6XB, ﬁfteen minutes prior to and during the above Annual General Meeting.
6. Pursuant to Regulation 41 of the Uncertiﬁcated Securities Regulations 2001, the Company speciﬁes that only
those shareholders registered in the Register of Members of the Company as at: 6.00 pm on 3 August 2009;
or if this general meeting is adjourned at 6.00pm on the day two days prior to the adjourned meeting, shall
be entitled to attend or vote at the above Annual General Meeting in respect of the number of shares
registered in their name at that time. Changes in the Register of Members after that time will be disregarded
in determining the rights of any person to attend or vote at the meeting.
7. In order to facilitate voting by corporate representatives at the meeting, arrangements will be put in place
at the Meeting so that:
(i) if a corporate member 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 the other corporate representatives for
that member 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
(ii) if more than one corporate representative for the same corporate member attends the Meeting but the
corporate member 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 members are referred to the guidance issued by the Institute of Chartered Secretaries and
Administrators on proxies and corporate representatives, available from www.icsa.org.uk, for further details
of this procedure. The guidance includes a sample form of representation letter to appoint the Chairman as
a corporate representative as described in (i) above.
8. As at 5.00 pm on 23 June 2009, the Company's issued share capital comprised 36,717,046 shares of 5p
each (excluding shares held in treasury). Each share carries the right to one vote at a general meeting of
the Company and, therefore, the total number of voting rights in the Company as at 5.00 pm on 23 June
2009 is 36,717,046. 71
25 June 2009 Announcement of results and proposal of dividend
23 July 2009 Shares become ex-dividend
24 July 2009 Record date for proposed dividend
5 August 2009 2009 Annual General Meeting
19 August 2009 Expected date of payment of proposed dividend
November 2009 Announcement of interim results and interim dividend for the six months
ended 30 September 2009
December 2009 Shares become ex-dividend
January 2010 Payment of interim dividend for 2009/10
June 2010 Announcement of results and proposal of dividend
September 2010 Shares become ex-dividend
Financial Calendar 72
Internet
Information about the Group can be found on the internet at www.goldshieldplc.com
Share price information
Shareholders are able to keep track of the share price through the ﬁnancial press and at the
Group’s internet site in the Investor Relations Section.
Changes in shareholder details
Shareholders should advise any changes in their personal details to the registrar, Capita Registrars,
Northern House, Woodsome Park, Fenay Bridge, Huddersﬁeld,West Yorkshire HD8 OLA.
Useful Information Sources for Shareholders