report and financial 
statements 2004
UK
Mediasurface plc
Mediasurface House
Newbury Business Park
London Road
Newbury
Berkshire
RG14 2QA
Phone: +44 (0)1635 262000 
Fax: +44 (0)1635 262001
Email: info@uk.mediasurface.com
Web: http://www.mediasurface.co.uk
CENTRAL EUROPE
Mediasurface BV
Gebouw Media Valley 1
Naarderweg 16
1217 GL Hilversum
Postbus 371
1200 AJ Hilversum
The Netherlands
Phone: +31 (0)35 625 7890 
Fax: +31 (0)35 625 7899
Email: info@nl.mediasurface.com
Web: http://www.mediasurface.nl
UNITED STATES
Mediasurface Inc
Three Stamford Landing, 4th Floor
46 Southfields Avenue
Stamford
CT, 06902
USA
Phone: +1 (203) 323 7173
Fax: +1 (203) 323 0595
Email: info@us.mediasurface.com
Web: http://www.mediasurface.com serious websites
driven by
business people
loved by IT MEDIASURFACE PLC Report and Financial Statements 2004 01
financial and operating highlights
01 FINANCIAL AND OPERATING HIGHLIGHTS
02 CHAIRMAN’S STATEMENT 
03 CHIEF EXECUTIVE’S REPORT
05 BOARD OF DIRECTORS
06 COMPANY INFORMATION
07 DIRECTORS’ REPORT
09 REPORT ON CORPORATE GOVERNANCE 
11 INDEPENDENT AUDITORS’ REPORT 
12 CONSOLIDATED PROFIT AND LOSS ACCOUNT
12 CONSOLIDATED STATEMENT OF TOTAL
RECOGNISED GAINS AND LOSSES
13 CONSOLIDATED BALANCE SHEET  
14 COMPANY BALANCE SHEET 
15 CONSOLIDATED CASHFLOW STATEMENT 
16 NOTES TO THE ACCOUNTS 
● Turnover up 4.7% to £5.40 million (2003: £5.16 million)
● Cash of £1.40 million as at 30 September 2004 
(2003: £0.88 million)
● Significantly reduced Loss of £0.41 million 
(2003: loss of £1.44 million)
● Annualised recurring revenue of £1.72 million 
(2003: £1.63 million)
● Raised £2.0 million from new and existing investors 
(£1.59 million net of placing costs)
● Launched Version 5.0 in March 2004 including the
innovative new smart client Morello
● Launched Version 5.1 in September 2004 containing 
further exciting features
● Pipeline opportunities continue to increase both 
in quantity and quality chairman’s statement
The year 2004 included two events which represented major milestones
in Mediasurface’s development and marked a significant turning point for
the Company.
Firstly, in March 2004 the Company launched Mediasurface Version 5.0 which
included the innovative new product Morello which empowers the business user
to leverage the full benefit of Content Management Software. In short, the product
has been received positively by existing and potential new customers alike.
The Company is now well positioned to compete effectively going forward.
Secondly, in August 2004 the Company successfully floated on the London
Stock Exchange Alternative Investment Market raising £2 million before placing
costs. The flotation has now given the Company the resources to fully exploit
the potential of Morello in the market place, develop further releases and provide
a basis for further acquisitions in the future.
Revenues increased by 4.7% to £5.4 million during the year, together with tight
cost control, losses for the full year were reduced from £1.44 million for the year
ended 30 September 2003 to £0.41 million in the year under review. Cash reserves
stood at £1.40 million. 
In line with stated policy, earnings for the foreseeable future will be re-invested
to finance the growth of the Company and acquisition strategy. Consequently
the Directors do not recommend the payment of a dividend. 
We were pleased to welcome the Rt Hon. Francis Maude MP to the Mediasurface
Board in August 2004. His experience of government has given us a breadth of
understanding in one of the Company’s important customer segments.
The full financial impact of Morello has not been felt in the financial year under
review due to the length of new business sales cycles, however, the Company
is now engaged with major new opportunities and the Directors are confident
these will drive revenue growth in the coming financial year.
MICHAEL JACKSON
Chairman
9 December 2004
02 MEDIASURFACE PLC Report and Financial Statements 2004 chief executive’s report
The year ended 30 September 2004 represented another year of considerable
improvement for the business as a whole recording an improvement in both
revenue and a further very significant reduction in trading losses, continuing the
trend established by the management team installed in late 2002. Both of these
improvements have however been achieved without compromising the company’s
investment in Research and Development, the long term future of the business.
Mediasurface is a software company earning a large portion of its revenues through
the licencing of its products and as such these products must be perceived to be
innovative, well differentiated and of real value to the end customer. In order to
achieve this the Company has developed a vision which has guided all of our
product development and all of our sales and marketing messaging. It is vital for
a software company such as Mediasurface to have such a vision and to remain
innovative enough to grow and attract new customers.
The Company’s vision is to empower “typical” business users with the capability
to build significant applications (websites, intranets and extranets) using extremely
easy to use commonplace desktop tools that are already familiar to them. These
users now have the ability to build, manage and run very significant applications
capable of scaling to very high levels of load with perhaps very large user
communities without the dependency on significant technical resources. The
business user should however be secure in the knowledge that the underlying
technology, which they need never be exposed to, is fully compliant with their
Company’s corporate IT standards and that the use of Mediasurface products
releases their IT resources for deployment on other added value activities.
We summarise this vision into nine words
“Serious websites, driven by business people, loved by IT”. 
It is this vision and the incremental steps the Company has taken to realise
it has delivered continued improvements in revenues and trading results.
In March of 2004, the Company made the most significant step yet towards
realising this vision through the release of its new flagship product, Morello
(www.hellomorello.com). This application is built using the Microsoft .NET framework
and Windows technology which is core technology for the vast majority of the
world’s desktops. As a consequence business users are now able to leverage
the power of their familiar desktop applications to participate fully in the content
lifecycle that underpins their applications. This new addition to the Mediasurface
suite has provided the Company with real differentiation in sales cycles which has
led to the Company being far more competitive in the marketplace, this is reflected
in sales pipeline improvements in all geographies. The Company intends to
continue to further develop its products in line with its vision during 2005.
Sales revenues during 2004 improved for the Company but perhaps the most
significant indicators come from the new business and new product to existing
customer revenue ratios. In 2003 existing customer revenue with our old product
instituted 59% of revenues with 41% from new business or product and in 2004
37% from old customers and product and 63% from new business and new
product. This demonstrates both the value of the new Morello product and also
MEDIASURFACE PLC Report and Financial Statements 2004 03 04 MEDIASURFACE PLC Report and Financial Statements 2004
the Company’s new found competitive capability. Another significant factor has
been the Company’s rejuvenation of its US business which, although still in its
early phase has led to an increase in US revenues of 27% compared to 2003.
Our mainland European business based in the Netherlands also remained strong
delivering 36% of corporate sales. It is the Directors’ belief that the short term
focus for the Company should remain focussed on our three geographies UK,
US and Benelux. The nature of the sales cycles (typically six to nine months)
together with the relative size of individual sales transaction when compared to the
Company’s overall revenues has meant that during 2004 the Company has been
vulnerable to sales slippage, where for example sales transactions fail to conclude
prior to a half or full year end. To a certain degree the Company remains vulnerable
to this however three factors should mitigate against this during 2005.
• As a result of the marketplace’s interest in Morello, more opportunities are
being generated which in turn should provide the Company with greater
coverage to replace any slipping revenue. 
• The Company continues to grow recurring revenues, up 5.5% compared
to last year, which reduces the dependency on new business sales. 
• The Company has commenced activities to provide Small and Mid-sized
Enterprises (‘SME’s’) with a hosted version of our products which they can
pay for on a monthly fee basis. This proposition is attractive to the SME
market because of the reduced initial capital outlay and is now facilitated
by the Morello product. This hosted or ASP model will deliver more modest
total deal sizes and greater volumes which will smooth out and reduce the
dependency on larger transactions close to half-year or full-year ends.
The listing of the Company on the AIM market was completed for a number of
reasons as stated in the prospectus. However one which should be individually
mentioned is Merger and Acquisition. The benefit to the Company of such a listing
can now be realised during 2005 and indeed in subsequent years to enable it
to execute purchase transactions to fuel its other inorganic growth strategy. The
Directors believe the Company is well placed to execute appropriate acquisitions
through the strength of the incumbent management team and should now have
the “management bandwidth” to undertake such transactions. 
The twin streams of the growth strategy (organic and acquisition) will continue
to be deployed during 2005 and these coupled with the maintenance of good
fiscal governance and cost control will remain the management team maxims.
The Directors believe that the improvements made during 2004 coupled to this
maxim should see the Company well placed to further build on its improvements
in revenues and trading position.
LAWRENCE FLYNN
Chief Executive Officer
9 December 2004
chief executive’s report (continued) board of directors
MEDIASURFACE PLC Report and Financial Statements 2004 05
MICHAEL JACKSON
Non-Executive Chairman
(Aged 54)
Michael is Chairman
of The Sage Group plc,
and Chairman of Elderstreet
Investments Limited, a City
of London based venture
capital and investment
company. Michael is a
Director and investor in
a number of quoted and
unquoted companies,
including Planit Holdings plc,
Netstore plc, Computer
Software Group plc and
Micromuse, Inc. Michael
qualified as a chartered
accountant with Coopers
& Lybrand.
LAWRENCE FLYNN
Chief Executive Officer
(Aged 40)
Lawrence joined Mediasurface
in March 2002 and has
18 years experience within
the IT applications industry.
Since 1993 he has had
P&L responsibility at Minerva
Industrial Systems plc,
the professional services
division of Origin UK Limited,
and Europe Middle East and
Africa operations of the
Wonderware Corporation
and i2 Technologies Inc.
DAVID DEACON 
Chief Financial Officer
(Aged 44)
David joined Mediasurface
in September 2002 and
is an Associate of the
Chartered Management
Accountants. He has 25
years financial, commercial
and management experience
gained in the UK and
internationally for a range
of technology businesses
including Kalamazoo
International plc,
Wonderware Corporation
and R L Polk & Co.
FRANCIS MAUDE 
Non-Executive Director
(Aged 51)
A barrister by training,
Francis was first elected to
Parliament in 1983. He was
a government minister
between 1985 and 1992
holding the posts of Minister
for Corporate and Consumer
Affairs at the DTI, Minister
of State at the Foreign Office
and Financial Secretary
to the Treasury. Following
the 1997 election, he was
Shadow Secretary for Media,
Culture and Sport from 1997
to 1998, Shadow Chancellor
from 1998 to 2000 and
Shadow Foreign Secretary
from 2000 to 2001. He is
currently Non-Executive
Chairman of Incepta,
Chairman of Prestbury
Holdings, Deputy Chairman
and Senior Independent
Director of Benfield Group,
and Chairman of The Jubilee
Investment Trust.
VIN MURRIA 
Non-Executive Director
(Aged 42)
Vin Murria is a Partner at
Elderstreet Capital Partners.
Prior to joining Elderstreet
Vin was European COO
for Kewill Systems plc
which was focused in
the key application areas
of Enterprise Systems,
Logistics and E-commerce.
Vin has a Computer Science
(First Class) Hons and
an MBA and is currently
a Director in a number
of quoted and unquoted
companies including
Computer Software Group plc
and Leeds Group plc. 06 MEDIASURFACE PLC Report and Financial Statements 2004
company information
DIRECTORS
M Jackson
L B Flynn
D A Deacon
F Maude
V Murria
SECRETARY
D A Deacon
REGISTERED OFFICE
Mediasurface House
Newbury Business Park
London Road
Berkshire RG14 2QA
NOMINATED ADVISOR AND BROKER
KBC Peel Hunt Limited
111 Old Broad Street
London EC1A 4DD
BANKERS
National Westminster Bank Plc
104 Tottenham Court Road
London W1A 3AW
SOLICITORS
Dorsey & Whitney
21 Wilson Street
London EC2M 2TD
AUDITORS
Nexia Audit Limited
Chartered Accountants
No.1 Riding House Street
London W1A 3AS
REGISTRARS
Computershare Investor Services plc
PO Box 82
The Pavillions
Bridgewater Road 
Bristol BS99 7NH
COMPANY REGISTRATION NUMBER 
4016495 MEDIASURFACE PLC Report and Financial Statements 2004 07
directors’ report
for the year ended 30 September 2004
The Directors present their audited financial statements for the year ended 30 September 2004.
PRINCIPAL ACTIVITIES
The Company is a holding Company. The principal activities of the Group comprise the development, marketing
and implementation of software solutions for the Internet and other digital channels. A more detailed review of
the business can be found in the Chairman’s and Chief Executive Report on pages 2 to 4.
RESULTS AND DIVIDENDS
The financial statements for the year ended 30 September 2004 are set out on pages 12 to 28. The Group loss
for the year, after taxation, was £406,121 loss (2003: £1,443,526 loss). No dividend is proposed.
SHARE ISSUES
On 26 August 2004 the Company placed 16,666,666 Ordinary shares of 1p raising £2,000,000 before placing costs.
Details of changes in share capital during the year are set out in note 17 to the accounts.
DIRECTORS AND THEIR INTERESTS
The Directors who served throughout the year except as stated were as follows:
M Jackson
L B Flynn
D A Deacon
D Rimer (resigned 17 August 2004)
F Maude (appointed 29 July 2004)
V Murria (appointed 29 July 2004)
The Directors who served during the year and their beneficial interests in the Company’s ordinary share capital
as at 30 September 2004 (or date of resignation) were as follows:
1p Ordinary 10p B Preferred 10p Preferred 10p Ordinary 1p Deferred
2004 2003 2004 2003 2004 2003 2004 2003 2004 2003
M Jackson 2,473,232 — — 189,437 — 994,680 — 6,468 — 2,163,593
L B Flynn 1,055,027 — — 83,120 — 443,312 — — — —
D A Deacon 55,395 — — 27,706 — — — — — —
F Maude — — — — — — — — — —
V Murria — — — — — — — — — —
During the year options were granted to L B Flynn and D A Deacon. Details of Directors’ share options are given
in note 8 to the accounts. 
None of the Directors had any beneficial interest in the issued share capital of any other group company,
as defined by the Companies Act 1985, at any time during the year.
SUBSTANTIAL SHAREHOLDINGS
As at 30 November 2004 the Company was aware of the following interests in 3% or more of its issued
share capital.
Number 
Shareholder of shares % Holding
Elderstreet
1
20,120,338 26.31
3i 19,243,358 25.16
Index Ventures
2
13,422,227 17.55
Amadeus
3
3,444,768 4.50
RBS Trust Artemis New Ent FD 2,916,667 3.81
Reuters Greenhouse Fund LP 2,455,534 3.21
Note
1) Includes Elderstreet Capital Partners Nominees Limited, Elderstreet Downing VCT plc, Triven VCT plc and Elderstreet
Millenium VCT plc
2) Includes Index Ventures 1 (Jersey) L.P, Index ventures 1 (Delaware) L.P, Index Ventures GmbH & Co KG, Index Ventures
1 Parallel Entrepreneur Fund (Jersey) L.P. Index Ventures Management SA
3) Includes Amadeus 1 Fund and Amadeus Affiliates Fund 08 MEDIASURFACE PLC Report and Financial Statements 2004
directors’ report (continued)
for the year ended 30 September 2004
CHARITABLE AND POLITICAL DONATIONS
The Group made no charitable or political donations during the year (2003: £Nil).
PAYMENT OF CREDITORS
It is the Group’s practice to agree credit terms with all suppliers and pay all approved invoices within these
agreed terms. The average trade creditor days for the year were 117 days (2003: 77 days).
CORPORATE GOVERNANCE
The Company is committed to high standards of corporate governance and is accountable to the shareholders
for good governance. The Board currently consists of an independent Chairman, the Chief Executive, the Chief
Financial Officer and two Non-Executive Director, and meets regularly, typically on a monthly basis. These
individuals demonstrate a range of experience sufficient to bring considered judgement on all business issues
and standards of conduct vital to the Company’s success.
POST BALANCE SHEET EVENTS
No circumstances have arisen since the balance sheet date in respect of matters which would require
adjustment or disclosure in the accounts.
AUDITORS
A resolution to re-appoint Nexia Audit Limited as the Company’s auditor will be proposed at the forthcoming
Annual General Meeting. 
By order of the Board
DAVID DEACON
Company Secretary
Registered Office
Mediasurface House
Newbury Business Park
London Road
Newbury, RG14 2QA
9 December 2004 report on corporate governance
for the year ended 30 September 2004
MEDIASURFACE PLC Report and Financial Statements 2004 09
COMBINED CODE
The Group is committed to applying the highest principles of corporate governance having regard to the
current stage of the development of the Group and comply, as far as practicable, with the Combined Code
on Corporate Governance.
INTERNAL CONTROLS
The Board takes responsibility for establishing and maintaining reliable systems of control in all areas of operation.
These systems of control, especially of financial control, can only provide reasonable, not absolute, assurance
that no material loss or misstatement has occurred.
The key features of the system of internal control are set out below:
• The Group has established a clearly defined and focused management structure which is subject to
regular review
• The Group prepares and monitors financial reporting on a monthly basis against budget, forecast and other
key performance indicators
• The Group conducts regular internal systems reviews of Subsidiary operations
The Board considers that there have been no substantial weaknesses in internal financial controls that have
resulted in any material losses, contingencies or uncertainties, which need to be disclosed in the accounts. The
Board has considered the need for an internal audit function within the Group and concluded there is no current
need for such a function. The Board can confirm there is an ongoing process for identifying, evaluating and
managing the significant risks faced by the Group, and that this process has been in place for the year under
review and up to the date of the approval of the Annual Review and Accounts. This process is regularly
reviewed by the Board.
STATEMENT OF DIRECTORS RESPONSIBILITIES
United Kingdom 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 Company and Group as at the end of the financial
year and of the profit or loss of the Company and Group for that period. In preparing those financial statements,
the Directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and estimates that are reasonable and prudent;
• state whether applicable accounting standards have been followed, subject to any material departure
disclosed and explained in the accounts;
• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
Group will continue in business.
The Directors are responsible for keeping proper accounting records, which disclose with reasonable accuracy
at any time the financial position of the Company and Group and to enable them to ensure that the financial
statements comply with the Companies Act. They are also responsible for the system of internal control,
safeguarding the assets of the Company and Group and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities. The Directors are responsible for ensuring that the Directors’
Report and other information included in the Annual Report is prepared in accordance with UK company law.
They are also responsible for ensuring that the Annual Report includes information required by the AIM rules.
The maintenance and integrity of the Group’s website is the responsibility of the Directors. The work carried out
by the auditors does not involve consideration of these matters and accordingly, the auditors accept no liability
for any changes that may have occurred to the information contained in the accounts since they were initially
presented on the web site.
Legislation in the UK governing the preparation and the dissemination of the accounts and other information
included in annual accounts may differ from legislation in other jurisdictions. 10 MEDIASURFACE PLC Report and Financial Statements 2004
report on corporate governance
(continued)
for the year ended 30 September 2004
ACCOUNTING POLICIES
The Board considers the appropriateness of its accounting policies on an annual basis. The Board believes that
its accounting policies and estimation techniques are prudent in particular in relation to income recognition,
research and development and deferred expenses.
BOARD OF DIRECTORS
The Board, comprises of two Executive Directors, a Non-Executive Chairman and two Non-Executive Directors,
is responsible for the overall strategy and direction of Mediasurface plc, as well as approving potential acquisitions,
major capital expenditure items and financing matters. The Board meets at least once a month. The Board is
provided with timely information in a form and of a suitable quality to enable it to discharge its duties. Advice from
independent advisors is available if required. The Board monitors exposure to key business risks and reviews
strategic direction of the Group, the annual budgets as well as their progress against those budgets.
The Board Members and their roles are described on page 5. In accordance with the Company’s Articles
of Association, one third of Directors are required to retire by rotation at the Annual General Meeting.
SHAREHOLDER RELATIONS
Mediasurface plc is dedicated to open communication with all its shareholders. Communication is primarily
through the Annual General Meeting where participation is encouraged so that the Board may answer questions.
The Group maintains a website www.mediasurface.com which contains up to date information on the Company
which shareholders are advised to visit from time to time.
Every shareholder receives a full Annual Report each year end and at the half year receive an interim report.
Care is taken to ensure that any price sensitive information is released to all shareholders, institutional and
private at the same time in accordance with London Stock Exchange rules.
Mediasurface plc is committed to give full, timely and realistic assessment of its business in a balanced way, 
in all price-sensitive reports and presentations.
AUDIT COMMITTEE
The Audit Committee is formally constituted with terms of reference. The Committee consists of Michael Jackson
(Chairman) who is the Non-Executive Chairman, Francis Maude a Non-Executive Director and David Deacon an
Executive Director.
The Committee meets at least two times a year and receives reports from the Group’s Auditors. The Committee
also reviews the interim and final accounts prior to approval by the Board. Additionally the Audit Committee also
ensures the independence and objectivity of the external auditors and also reviews the provision of non-audit
services by external auditors.
THE REMUNERATION COMMITTEE
The Remuneration Committee is chaired by Francis Maude and comprises of Vin Murria a Non-Executive Director.
The Committee determines the remuneration and benefits package for the Executive Directors and any changes
to their service contracts. The Committee also approves any share related incentive schemes within the Group.
GOING CONCERN
The Directors have reviewed the Group’s budget and cash flow for 2005/06 and the medium term plan and are
satisfied that it is appropriate to prepare the Accounts on a going concern basis. independent auditors’ report
to the shareholders of Mediasurface plc
We have audited the accounts of Mediasurface plc for the year ended 30 September 2004 which comprise the
Profit and Loss account, the Statement of Total Recognised Gains and Losses, the Balance Sheet, the Cash
Flow Statement and related notes 1 to 26. These accounts have been prepared under the historical cost
convention and the accounting policies set out therein.
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 auditors’ 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 AUDITORS
As described in the Statement of Directors’ Responsibilities the Company’s Directors are responsible for the
preparation of the accounts in accordance with applicable law and United Kingdom Accounting Standards.
Our responsibility is to audit the accounts in accordance with relevant legal and regulatory requirements and
United Kingdom Auditing Standards. 
We report to you our opinion as to whether the accounts give a true and fair view and are properly prepared in
accordance with the Companies Act 1985. We also report to you if, in our opinion, the Directors’ Report is not
consistent with the accounts, if 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 the information specified by law regarding
Directors’ remuneration and transactions with the Company is not disclosed.
We read other information contained in the annual report and consider whether it is consistent with the audited
accounts. The other information comprises only the Chairman’s Statement, the Chief Executive’s Report, the
Directors’ Report and the Report on Corporate Governance. We consider the implications for our report if we
become aware of any apparent misstatements or material inconsistencies with the accounts. Our responsibilities
do not extend to any other information.
BASIS OF AUDIT OPINION
We conducted our audit in accordance with United Kingdom Auditing Standards issued by the Auditing
Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and
disclosures in the accounts. It also includes an assessment of the significant estimates and judgements made
by the Directors in the preparation of the accounts, and of whether the accounting policies are appropriate to
the Company’s circumstances, consistently applied and adequately disclosed.
We planned and performed our audit so as to obtain all the information and explanations which we considered
necessary in order to provide us with sufficient evidence to give reasonable assurance that the accounts 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 accounts.
OPINION
In our opinion the accounts give a true and fair view of the state of affairs of the Company and the Group as
at 30 September 2004 and of the loss of the Group for the year then ended and have been properly prepared
in accordance with the Companies Act 1985.
NEXIA AUDIT LIMITED
Chartered Accountants
Registered Auditors
1 Riding House Street
London
W1A 3AS
9 December 2004
MEDIASURFACE PLC Report and Financial Statements 2004 11 12 MEDIASURFACE PLC Report and Financial Statements 2004
consolidated profit and loss account
for the year ended 30 September 2004
2004 2003
Note £ £
Turnover 2 5,403,482 5,160,933
Cost of sales (142,533) (174,024)
Gross profit 5,260,949 4,986,909
Administrative expenses (5,993,342) (7,204,603)
Operating loss (732,393) (2,217,694)
Interest receivable and similar income 3 7,603 7,553
Interest payable and similar charges 3 (12,604) (19,126)
Loss on ordinary activities before taxation 4 (737,394) (2,229,267)
Tax credit on loss on ordinary activities 5 331,273 785,741
Loss on ordinary activities after taxation
and for the financial year 6,18 (406,121) (1,443,526)
Earnings per share – basic 6 (0.7)p (2.4)p
Earnings per share – diluted 6 (0.6)p (2.4)p
All results are derived from continuing operations.
consolidated statement of total
recognised gains and losses
for the year ended 30 September 2004
2004 2003
£ £
Loss for the financial year (406,121) (1,443,526)
Loss on foreign currency translation of equity investments in overseas subsidiaries (27,479) (31,330)
Total recognised losses relating to the year (433,600) (1,474,856) MEDIASURFACE PLC Report and Financial Statements 2004 13
consolidated balance sheet
as at 30 September 2004
2004 2003
Note £ £
Fixed assets
Goodwill 10 — 45,790
Tangible assets 11 177,969 149,556
177,969 195,346
Current assets
Debtors 13 2,173,866 1,442,375
Cash at bank and in hand 1,395,558 879,406
3,569,424 2,321,781
Creditors: amounts falling due within one year 14 (2,276,041) (2,231,536)
Net current assets 1,293,383 90,245
Total assets less current liabilities 1,471,352 285,591
Creditors: amounts falling due after more than one year 15 (14,384) (19,580)
Net assets 1,456,968 266,011
Capital and reserves
Called up equity share capital 17 764,738 13,474,032
Share premium account 18 9,574,782 8,324,175
Capital redemption reserve 18 13,083,244 —
Merger reserve 18 27,297,412 27,297,412
Profit and loss account 18 (49,263,208) (48,829,608)
Shareholders’ funds 19 1,456,968 266,011
Shareholders’ funds may be analysed as:
Equity interests 1,456,968 266,011
These financial statements were approved by the Board of Directors on 9 December 2004.
Signed on behalf of the Board of Directors
DAVID DEACON LAWRENCE FLYNN
Director Director 14 MEDIASURFACE PLC Report and Financial Statements 2004
company balance sheet
as at 30 September 2004
2004 2003
Note £ £
Fixed assets
Investments 12 — —
Current assets
Debtors – recoverable after more than one year 13 2,586,307 975,000
Creditors: amounts falling due within one year 14 (208,641) (250,437)
Net current assets 2,377,666 724,563
Capital and reserves
Called up equity share capital 17 764,738 13,474,032
Share premium account 18 9,574,782 8,324,175
Capital redemption reserve 18 13,083,244 —
Profit and loss account 18 (21,045,098) (21,073,644)
Shareholders’ funds 2,377,666 724,563
Shareholders’ funds may be analysed as:
Equity interests 2,377,666 724,563
These financial statements were approved by the Board of Directors on 9 December 2004.
Signed on behalf of the Board of Directors
DAVID DEACON LAWRENCE FLYNN
Director Director MEDIASURFACE PLC Report and Financial Statements 2004 15
consolidated cashflow statement
for the year ended 30 September 2004
2004 2003
Note £ £
Net cash outflow from operating activities 20 (1,170,202) (1,077,941)
Returns on investments and servicing of finance 21 (5,001) (11,573)
Taxation 5 227,044 785,741
Capital expenditure 21 (80,816) (164,735)
Cash outflow before financing (1,028,975) (468,508)
Financing 21 1,572,606 785,190
Increase in cash in the year 22 543,631 316,682 16 MEDIASURFACE PLC Report and Financial Statements 2004
notes to the accounts
for the year ended 30 September 2004
1. ACCOUNTING POLICIES
The principal accounting policies are summarised below.
Basis of preparation
The financial statements have been prepared in accordance with applicable UK accounting standards and under
the historic cost convention. They have all been applied consistently throughout the year and the preceding year.
The Group has made a loss for the year of £406,121, however, the Company has net assets of £1,456,968 and
the Directors have prepared cash flow forecasts, which predict that the Group will generate increasing levels of
income and as a result a positive net cash position. Therefore the Directors consider the going concern basis to
be appropriate.
Basis of consolidation
The Group financial statements consolidate the financial statements of Mediasurface plc and its subsidiary
undertakings drawn up to 30 September 2004.
In the Company’s financial statements, investments in subsidiary undertakings are stated at cost less provision
for impairment.
Research and development
Research and development expenditure is written off as incurred.
Intangible assets – goodwill
Goodwill arising on the acquisition of subsidiary undertakings and businesses representing any excess of
the fair value of the consideration given over the fair value of the identifiable assets and liabilities acquired is
capitalised and written off on a straight line basis over its useful economic life, which is two years. Provision
is made for any impairment.
Tangible fixed assets
Tangible fixed assets are stated at cost, net of depreciation and any provision for impairment. Depreciation
is provided on all tangible fixed assets at rates calculated to write off the cost, less estimated residual value,
of each asset on a straight-line basis over its expected useful life, as follows:
Leasehold improvements Unexpired period of lease 
Office equipment and computers two years
Furniture and fixtures two years
Investments
Fixed asset investments are shown at cost less provision for impairment.
Taxation
Current tax, including UK corporation tax and foreign tax, is provided at amounts expected to be paid (or recovered)
using the tax rates and laws that have been enacted or substantially enacted by the balance sheet date.
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the
balance sheet date where transactions or events that result in an obligation to pay more tax in the future or
a right to pay less tax in the future have occurred at the balance sheet date. Timing differences are differences
between the Group’s taxable profits and its results as stated in the financial statements that arise from the
inclusion of gains and losses in tax assessments in periods different from those in which they are recognised
in the financial statements.
A net deferred tax asset is regarded as recoverable and therefore recognised only when, on the basis of all
evidence available, it can be regarded as more likely than not that there will be suitable taxable profits from
which the future reversal of the underlying timing differences can be deducted.
Deferred tax is not recognised when fixed assets are re-valued unless by the balance sheet date there is
a binding agreement to sell the re-valued assets and the gain or loss expected to arise on sale has been
recognised in the financial statements. Neither is deferred tax recognised when fixed assets are sold and
it is more likely than not that the tangible gain will be rolled over, being charged to tax only if and when the
replacement assets are sold.
Deferred tax is recognised in respect of the retained earnings of overseas subsidiaries and associates only to
the extent that, at the balance sheet date, dividends have been accrued as receivable or a binding agreement
to distribute past earnings in future has been entered into by the subsidiary. MEDIASURFACE PLC Report and Financial Statements 2004 17
Taxation (continued)
Deferred tax is measured at the average tax rates that are expected to apply in the periods in which the timing
differences are expected to reverse based on tax rates and laws that have been enacted or substantively
enacted by the balance sheet date. Deferred tax is measured on a non-discounted basis.
Revenue recognition and long-term contracts
Revenue from the sale of software relates mainly to perpetual licences, which provide the customer with the
right to use the Group’s products. Where additional services are not essential to the functionality of the software
then revenue is recognised in full on delivery when the following conditions are met:
• persuasive evidence is available that a legally binding agreement exists; 
• the fee is fixed or determinable; and
• collection is probable. 
Maintenance revenue is recognised on a straight-line basis over the life of the related agreement.
Revenue generated from consultancy and training contracts is recognised when the work is performed.
Pension costs and other post retirement benefits
The Company does not operate any defined benefit schemes. For defined contribution schemes the amount
charged to the profit and loss account in respect of pension costs and other post-retirement benefits is the
contributions payable in the year. Differences between contributions payable in the year and contributions
actually paid are shown as either accruals or prepayments in the balance sheet.
Foreign currency
Transactions in foreign currencies are recorded at the rates of exchange at the dates of the transactions or,
if hedged, at the forward contract rates. Monetary assets and liabilities denominated in foreign currencies at the
balance sheet date are reported at the rates of exchange prevailing at that date or, if appropriate, at the forward
contract rates.
The results of overseas operations are translated at the average rates of exchange during the period and their
balance sheets at the rates ruling at the balance sheet date. Exchange differences arising on translation of the
opening net assets and results of overseas operations are dealt with through reserves. All other exchange
differences are included in the profit and loss account.
Leases
Assets held under finance leases and other similar contracts, which confer rights and obligations similar to those
attached to owned assets, are capitalised as tangible fixed assets and are depreciated over the shorter of the
lease terms and their useful lives. The capital elements of future lease obligations are recorded as liabilities,
while the interest elements are charged to the profit and loss account over the period of the leases to produce
a constant rate of charge on the balance of capital repayments outstanding. Hire purchase transactions are
dealt with similarly, except that assets are depreciated over their useful lives.
Rentals under operating leases are charged on a straight-line basis over the lease term, even if the payments
are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are
similarly spread on a straight-line basis over the lease term, except where the period to the review date on
which the rent is first expected to be adjusted to the prevailing market rate is shorter than the full lease term,
in which case the shorter period is used.
Finance costs
Finance costs of debt, non-equity shares and non-equity minority interests are recognised in the profit and loss
account over the term of such instruments at a constant rate on the carrying amount. Where the finance costs
for non-equity shares and non-equity minority interests are not equal to the dividends on these instruments,
the difference is also accounted for in the profit and loss account as an appropriation of profits. 18 MEDIASURFACE PLC Report and Financial Statements 2004
notes to the accounts
for the year ended 30 September 2004
2. SEGMENT INFORMATION
Turnover by Loss on ordinary activities 
destination before taxation Net assets
2004 2003 2004 2003 2004 2003
£ £ £ £ £ £
United Kingdom 3,071,684 3,240,511 (310,649) (1,628,616) 2,518,273 864,126
Rest of Europe 1,924,893 1,600,613 (131,936) (345,141) (646,741) (484,356)
United States 406,905 319,809 (294,809) (255,510) (414,564) (113,759)
Total 5,403,482 5,160,933 (737,394) (2,229,267) 1,456,968 266,011
Turnover by destination is not materially different from the above.
3. FINANCE CHARGES
2004 2003
£ £
Interest receivable 
Bank interest 7,603 7,553
Interest payable and similar charges
Bank loans and overdrafts 11,515 3,368
Finance leases terminating within five years 1,089 15,758
12,604 19,126
4. LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION
Loss on ordinary activities before taxation is stated after charging:
2004 2003
£ £
Depreciation and amounts written off tangible fixed assets:
– owned 52,216 23,545
Goodwill amortisation 45,790 45,789
Research and development
– current year expenditure 1,136,169 1,200,865
Operating lease rentals:
– equipment 47,908 338,450
– other 309,134 350,859
Auditors’ remuneration
– audit services (Group) 14,890 12,500
– audit services (parent company) 5,000 5,000
– non-audit services (paid to related companies of the auditors) 13,407 30,000
The auditors received £80,870 in respect of fees associated with the listing on AIM. These have been deducted
from the Company share premium account. MEDIASURFACE PLC Report and Financial Statements 2004 19
5. TAX CREDIT ON LOSS ON ORDINARY ACTIVITIES
The tax credit comprises:
2004 2003
£ £
Current tax — —
Overseas tax — —
Adjustment in respect of prior years: — —
Research and development tax credit (331,273) (785,741)
Total current tax (331,273) (785,741)
The tax credit arose from a research and development tax credit claim for the years ending 30 September 2003,
of £227,044 and 30 September 2004 of £104,229. (2003: Years ended 30 September 2001 of £521,175 and
30 September 2002 of £264,566).
In addition, a deferred tax asset has not been recognised in respect of tax losses available to carry forward
against future taxable profits and timing differences relating to depreciation in excess of capital allowances as
the Directors consider there is insufficient evidence that the assets will be recovered. The amount of the asset
not recognised at 30% is £7,382,430 (2003: £4,675,539). These assets will be recovered if the Group makes
future taxable profits.
The difference between the total current tax shown above and the amount calculated by applying the standard
rate of UK corporation tax to the loss before tax is as follows:
2004 2003
£ £
Loss on ordinary activities before tax (737,394) (2,229,267)
Tax on loss ordinary activities at standard UK corporation tax rate of 30% (2003: 19%) (221,218) (423,561)
Effects of:
Expenses not deductible for tax purposes 2,502 123,166
Depreciation in excess of capital allowances 7,426 1,956
Other timing differences — 1,096
Tax losses not recognised 140,552 383,023
Losses utilised in R&D tax credit claim (104,229) (257,038)
Potential R&D tax credit claim not recognised 70,738 171,358
Adjustment in respect of prior years (227,044) (785,741)
Current tax credit for year (331,273) (785,741) 
6. LOSS FOR THE FINANCIAL YEAR
The loss per ordinary share is calculated by reference to the loss attributable to ordinary shareholders divided by
the weighted average number of shares in issue during each period as follows:
2004 2003
£ £
Loss for the year (406,121) (1,443,526)
Basic – Weighted average number of shares in issue 61,450,900 59,356,184
Basic – Loss per share (0.7p) (2.4p)
Fully diluted – Weighted average number of shares in issue 62,154,270 59,356,184
Fully diluted – Loss per share (0.6p) (2.4p) 20 MEDIASURFACE PLC Report and Financial Statements 2004
notes to the accounts
for the year ended 30 September 2004
7. STAFF COSTS
The average monthly number of employees (including Executive Directors) was:
2004 2003
No. No.
Professional services 19 23
Development 17 16
Sales and marketing 23 24
Operations 12 10
71 73
2004 2003
£ £
Their aggregate remuneration comprised:
Wages and salaries 3,564,097 3,712,897
Social security costs 394,010 408,932
Other pension costs 185,858 256,243
4,143,965 4,378,072
8. DIRECTORS’ REMUNERATION, INTERESTS AND TRANSACTIONS
Aggregate remuneration
The total amounts for Directors’ remuneration and other benefits were as follows:
2004 2003
£ £
Emoluments 265,658 262,076
Company contributions to money purchase pension schemes 14,750 —
280,408 262,076
Highest paid director
The above amounts for remuneration include the following in respect of the highest paid Director:
2004 2003
£ £
Emoluments 140,651 150,084
Company contributions to money purchase pension schemes 6,250 —
146,901 150,084
Pensions
The number of Directors who were members of money purchase pension schemes:
2004 2003
No. No.
Money purchase schemes 2 —
Share options
The following options have been granted to the Executive Directors over ordinary 1p shares in the Company.
At start Granted during At end Exercise Exercise Exercise
of year the year Exercised of year price date from date to
L B Flynn — 1,699,417 — 1,699,417 1p Aug 2004 Aug 2014
D A Deacon — 764,738 — 764,738 1p Aug 2004 Aug 2014
Directors’ interests
None of the Directors who held office at 30 September 2004 had interests in the shares and debentures
of Group undertakings other than those listed in the Directors’ Report on page 7. MEDIASURFACE PLC Report and Financial Statements 2004 21
9. RESULT ATTRIBUTABLE TO MEDIASURFACE PLC 
As permitted by Section 230 of the Companies Act 1985, no separate profit and loss account is presented
in respect of the parent company. The parent company’s profit for the financial year amounted to £28,546
(2003: loss £250,437).
10. INTANGIBLE ASSETS – GOODWILL
£
Cost
At 30 September 2004 91,579
Amortisation
At 1 October 2003 (45,789)
Charge for year (45,790)
At 30 September 2004 (91,579)
Net book value
At 30 September 2004 —
At 30 September 2003 45,790
Goodwill arose on the purchase of certain assets of Reef, including their software platform, client base and
domain name reef.com
11. TANGIBLE FIXED ASSETS
Office
Leasehold equipment and Furniture and 
improvements computers fixtures Total
Group ££££
Cost
At 1 October 2003 455,645 3,975,133 385,850 4,816,628
Additions — 80,816 — 80,816
Disposals (321,602) (3,933,814) (384,300) (4,639,716)
Currency exchange movement — (947) — (947)
At 30 September 2004 134,043 121,188 1,550 256,781
Depreciation
At 1 October 2003 328,286 3,954,163 384,623 4,667,072
Charge for the year 13,616 37,825 775 52,216
Disposals (321,602) (3,933,814) (384,300) (4,639,716)
Currency exchange movement — (760) — (760)
At 30 September 2004 20,300 57,414 1,098 78,812
Net book value
At 30 September 2004 113,743 63,774 452 177,969
At 30 September 2003 127,359 20,970 1,227 149,556 22 MEDIASURFACE PLC Report and Financial Statements 2004
notes to the accounts
for the year ended 30 September 2004
12. FIXED ASSET INVESTMENTS
Subsidiary undertakings £
Cost
At 1 October 2003 and 30 September 2004 2,450,826
Provisions for impairment
At 1 October 2003 and 30 September 2004 (2,450,826)
Net book value
At 30 September 2004 —
At 30 September 2003 —
Principal group investments
The Company and the Group have investments in the following subsidiary undertakings, which principally
affected the profits or net assets of the Group. The principal activity of all companies within the Group is
software sales and consultancy.
Subsidiary undertakings Country of incorporation Holdings %
Mediasurface Europe Limited
+
Great Britain (Refer below) 100
Mediasurface Inc United States 10,000 shares of USD 1 100
Mediasurface BV Netherlands 40 shares of NLG 1000 100
+
Held direct by Mediasurface plc as follows:
Number of shares £
Ordinary shares of 5p each 14,814,246 740,712
A Ordinary shares of 5p each 14,527,000 726,350
Series A Participating Redeemable Preferred shares of 5p each 12,323,349 616,167
Series B Participating Redeemable Preferred shares of 5p each 7,351,934 367,597
49,016,529 2,450,826
All subsidiary undertakings have been included in the consolidation. The carrying value of the investment
in Mediasurface Europe Limited has been impaired to £Nil as the subsidiary made a profit of £33,874
(2003: Loss of £592,438) and has net liabilities of £18,144,611 (2003: £18,178,485).
13. DEBTORS
Group Company
2004 2003 2004 2003
£ £ £ £
Trade debtors 1,660,666 1,071,546 — —
Amount owed by subsidiary undertaking –
due after more than one year — — 2,586,307 975,000
Other debtors 103,315 122,644 — —
Prepayments and accrued income 409,885 248,185 — —
2,173,866 1,442,375 2,586,307 975,000 MEDIASURFACE PLC Report and Financial Statements 2004 23
14. CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR
Group Company
2004 2003 2004 2003
£ £ £ £
Obligations under finance leases 5,195 51,950 — —
Trade creditors 438,300 325,650 — —
Taxation and social security 255,299 328,180 — —
Accruals and deferred income 1,577,247 1,525,756 208,641 250,437
2,276,041 2,231,536 208,641 250,437
15. CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR
Group
2004 2003
£ £
Obligations under finance leases 14,384 19,580
Borrowings are repayable as follows:
2004 2003
£ £
Finance leases
Between one and two years 5,195 51,950
Between two and five years 9,189 14,385
After five years — 5,195
14,384 71,530
16. FINANCIAL INSTRUMENTS DISCLOSURE UNDER FRS 13
The Group uses a limited number of financial instruments comprising cash and short-term deposits and various
items such as trade debtors and creditors, which arise directly from operations. The main financial risks faced
by the Group are those of interest rate, foreign currency movements and cash liquidity. The Board agrees
policies for managing each of these risks as appropriate. The Group does not trade in financial instruments.
In respect of interest rate risk, the Group finances its operations through a mix of cash flow from current
operations together with cash on deposit and bank and other borrowings. Any borrowings are generally at
floating rates of interest and no uses of interest rate swaps have been made. In respect of liquidity risk, the
Group ensures it has adequate cover through the availability of cash resources.
Mediasurface Inc and Mediasurface BV, whose revenues, expenditures and cash flow are denominated in
dollars and euros respectively, provide a natural hedge against foreign currency risk. Gains and losses arising
from this foreign currency exposure are shown in the statement of total recognised gains and losses.
The fair values of the Group’s sterling, dollar and euro financial assets and liabilities are not materially different from
their book values. The Group considers the interest and foreign currency risk to be immaterial to the accounts. 24 MEDIASURFACE PLC Report and Financial Statements 2004
notes to the accounts
for the year ended 30 September 2004
17. CALLED UP SHARE CAPITAL
2004 2003
Number of Number of
shares £ shares £
Authorised
Ordinary Shares of 1p 1,500,000,000 15,000,000 ——
Ordinary shares of 10p —— 6,575,641 657,564
B Preferred Ordinary Shares of 10p —— 5,541,394 554,139
Preferred ordinary shares of 10p each —— 32,492,788 3,249,279
Deferred ordinary shares of 1p each —— 956,614,782 9,566,148
1,500,000,000 15,000,000 1,001,224,605 14,027,130
2004 2003
Number of Number of
shares £ shares £
Allotted issued, called up and fully paid
Ordinary Shares of 1p 76,473,783 764,738 ——
Ordinary shares of 10p —— 3,345,268 334,527
B Preferred Ordinary shares of 10p —— 5,541,394 554,139
Preferred ordinary shares of 10p each —— 30,192,185 3,019,218
Deferred ordinary shares of 1p each —— 956,614,782 9,566,148
76,476,783 764,738 995,693,629 13,474,032
In connection with the admission of the Company to trading on the Alternative Investment Market (‘AIM’) of the
London Stock Exchange plc the following share capital re-organisation was undertaken in accordance with
resolutions passed at an EGM held 5 August 2004.
Out of a sum standing credit of the share premium account a sum equal to £202,773 was applied to make a bonus
issue of 20,277,333 ordinary shares of 1p at par. These were allotted and issued as fully paid in accordance with
and pursuant to the terms of Article 5.3 and 16 of the former Articles of Association of the Company.
61 new Deferred Ordinary shares were allotted to David Deacon for a subscription price of 61p for the purpose
of redeeming all of the issued Deferred Shares pursuant to the agreement referred to in paragraph (2) of EGM
resolution 3.
450,933 new ordinary shares of 1p each was allotted in the capital of the Company for a subscription price of
10p pursuant to the exercise of warrants issued pursuant to an instrument entered into by the Company and
dated 30 September 2002.
The issued share capital of the Company was then sub-divided prior to the allotments described above
such that
• 5,541,394 B Preferred Ordinary Shares of 10p were converted into 5,541,394 Ordinary shares of 1p and
49,872,546 Deferred Ordinary Shares of 1p.
• 30,192,185 Preferred Ordinary Shares of 10p were converted into 30,192,185 Ordinary shares of 1p and
271,729,665 Deferred Ordinary shares of 1p.
• 3,345,272 Ordinary shares of 10p were converted into 3,345,272 Ordinary shares of 1p and 30,107,448
Deferred Ordinary shares of 1p.
1,308,324,502 Deferred Ordinary shares of 1p was then acquired by the Company for an aggregate
consideration of 1p.
Following the above re-organisation the Company had an issued share capital of 59,807,117 Ordinary Shares
of 1p.
On the 26 August 2004 16,666,666 Ordinary 1p were placed on behalf of the Company with new and existing
investors at a price of 12p raising £1,585,767 net of costs. MEDIASURFACE PLC Report and Financial Statements 2004 25
17. CALLED UP SHARE CAPITAL (CONTINUED)
Share options
Give the Share re-organisation described the start position in the following table has been restated accordingly.
Options have been granted to employees of the Company under an unapproved share option plan being all
options at the start of the year and an Approved EMI Scheme to subscribe for ordinary shares of 1p each of
the Company as follows:
Granted 
At start during 
of year the year Exercised Lapsed At end of year Exercise Price Exercise date from Exercise date to
181 — — — 181 £132.14 Feb 2005 Sep 2009
20 — — — 20 £32.44 Feb 2005 Mar 2010
147 — — — 147 £33.10 Feb 2005 Mar 2010
3,459 — — — 3,459 £33.14 Feb 2005 Mar 2010
2,011 — — — 2,011 £33.16 Feb 2005 Mar 2010
86 — — — 86 £33.12 Feb 2005 Mar 2010
2,555 — — — 2,555 £33.15 Feb 2005 Mar 2010
95 — — — 95 £33.31 Feb 2005 Mar 2010
318 — — — 318 £33.17 Feb 2005 Mar 2010
36 — — — 36 £132.88 Feb 2005 Jun 2010
76 — — — 76 £132.63 Feb 2005 Jun 2010
127 — — — 127 £131.83 Feb 2005 Jun 2010
505 — — — 505 £131.93 Feb 2005 Jun 2010
90 — — — 90 £132.88 Feb 2005 Sep 2010
132 — — — 132 £130.46 Feb 2005 Sep 2010
37 — — — 37 £136.22 Feb 2005 Sep 2010
30 — — — 30 £140.00 Feb 2005 Sep 2010
286 — — — 286 £132.17 Feb 2005 Dec 2010
272 — — — 272 £131.90 Feb 2005 Dec 2010
64 — — — 64 £131.25 Feb 2005 Mar 2011
19 — — — 19 £132.18 Feb 2005 Mar 2011
477 — — — 477 £132.08 Feb 2005 Mar 2011
272 — — — 272 £131.90 Feb 2005 Mar 2011
15,240 — — — 15,240 £5.50 Feb 2005 Oct 2011
— 7,136,434 — — 7,136,434 £0.01 Aug 2004 Aug 2014
26,535 7,136,434 — — 7,162,969 26 MEDIASURFACE PLC Report and Financial Statements 2004
notes to the accounts
for the year ended 30 September 2004
18. RESERVES
Group
Capital Share
redemption Merger premium Profit and loss
reserve reserve account account Total
£££££
At 1 October 2003 — 27,297,412 8,324,175 (48,829,608) (13,208,021)
Share issues/redemptions — — 1,664,840 — 1,664,840
Issue costs — — (414,233) — (414,233)
Loss on foreign currency translation 
of equity investments in subsidiaries — — — (27,479) (27,479)
Capital redemption reserve 13,083,244——— 13,083,244
Loss for the year — — — (406,121) (406,121)
At 30 September 2004 13,083,244 27,297,412 9,574,782 (49,263,208) 692,230
Company
Capital Share
redemption premium Profit and loss
reserve account account Total
££££
At 1 October 2003 — 8,324,175 (21,073,644) (12,749,469)
Share issues — 1,664,840 — 1,664,840
Issue costs — (414,233) — (414,233)
Capital redemption reserve 13,083,244 — — 13,083,244
Profit for the year — — 28,546 28,546
At 30 September 2004 13,083,244 9,574,782 (21,045,098) 1,612,928
19. RECONCILIATION OF MOVEMENT IN GROUP SHAREHOLDERS’ FUNDS
2004 2003
£ £
Opening shareholders’ funds 266,011 765,867
Loss for the financial year (406,121) (1,443,526)
Other recognised gains and losses relating to the year (27,479) (31,330)
New shares issued 1,624,557 975,000
Closing shareholders’ funds 1,456,968 266,011 MEDIASURFACE PLC Report and Financial Statements 2004 27
20. RECONCILIATION OF OPERATING LOSS ON ORDINARY ACTIVITIES 
TO NET CASH OUTFLOW FROM OPERATING ACTIVITIES
2004 2003
£ £
Operating loss (732,393) (2,217,694)
Exchange difference on fixed asset translation 187 (799)
Depreciation charge 52,216 23,545
Amortisation of goodwill 45,790 45,789
(Increase)/decrease in debtors (627,262) 924,392
Increase in creditors 91,260 146,826
Net cash outflow from operating activities (1,170,202) (1,077,941)
21. ANALYSIS OF CASH FLOWS
2004 2003
£ £
Returns on investments and servicing of finance
Interest received 7,603 7,553
Interest paid (12,604) (19,126)
Net cash outflow (5,001) (11,573)
Capital expenditure
Purchase of tangible fixed assets (80,816) (164,735)
Net cash outflow (80,816) (164,735)
Financing
Issue of share capital 1,624,557 975,000
Capital element of finance lease rental payments (51,951) (189,810)
Net cash inflow 1,572,606 785,190 28 MEDIASURFACE PLC Report and Financial Statements 2004
notes to the accounts
for the year ended 30 September 2004
22. ANALYSIS AND RECONCILIATION OF NET FUNDS
1 October Exchange 30 September 
2003 Cash flow movement 2004
£££ £
Cash in hand and at bank 879,406 543,631 (27,479) 1,395,558
Finance leases (71,530) 51,951 — (19,579)
Net funds 807,876 595,582 (27,479) 1,375,979
2004 2003
£ £
Increase in cash in the year 543,631 348,012
Cash outflow from decrease in debt and lease financing 51,951 189,810
Change in net debt resulting from cash flows 595,582 537,822
Translation difference (27,479) (31,330)
Movement in net debt in year 568,103 506,492
Net funds at 1 October 2003 807,876 301,384
Net funds at 30 September 2004 1,375,979 807,876
23. FINANCIAL COMMITMENTS
At 30 September 2004 there were no capital commitments that had not been provided for.
Annual commitments under non-cancellable operating leases are as follows:
2004 2003
Land and Land and
buildings Other buildings Other
Group ££ ££
Expiry date
– within one year 51,502 62,930 51,502 112,931
– between two and five years 246,908 114,575 246,908 93,004
298,410 177,505 298,410 205,935
Leases of land and buildings are typically subject to rent reviews at specified intervals and provide for the lessee
to pay all insurance, maintenance and repair costs.
24. CONTINGENT LIABILITIES
There were no contingent liabilities at 30 September 2004 (2003: £Nil).
25. RELATED PARTY TRANSACTIONS
At 30 September 2004, an amount of £195,788 was due from Mediasurface (Scotland) Limited. This is an
independent company established by an ex-employee of Mediasurface Europe Limited with common Directors.
For License Sales Mediasurface (Scotland) Limited pay a royalty of 40% and a royalty of 90% for consulting,
training and software maintenance income. Total royalty income in the year ended 30 September 2004 was
£503,323 (2003: £359,015). 
At 30 September 2004, an amount of £4,406 was payable to Elderstreet Private Equity Limited in respect
of Directors fees for M Jackson. The companies are related by virtue of common Directors. Total fees for
the year ended 30 September 2004 were £11,250 (2003: £Nil).
26. CONTROLLING PARTY
No group, individual or individuals, acting in concert, control either directly or indirectly more than 30% 
of the issued share capital of Mediasurface plc and as such there is no controlling party.  report and financial 
statements 2004
UK
Mediasurface plc
Mediasurface House
Newbury Business Park
London Road
Newbury
Berkshire
RG14 2QA
Phone: +44 (0)1635 262000 
Fax: +44 (0)1635 262001
Email: info@uk.mediasurface.com
Web: http://www.mediasurface.co.uk
CENTRAL EUROPE
Mediasurface BV
Gebouw Media Valley 1
Naarderweg 16
1217 GL Hilversum
Postbus 371
1200 AJ Hilversum
The Netherlands
Phone: +31 (0)35 625 7890 
Fax: +31 (0)35 625 7899
Email: info@nl.mediasurface.com
Web: http://www.mediasurface.nl
UNITED STATES
Mediasurface Inc
Three Stamford Landing, 4th Floor
46 Southfields Avenue
Stamford
CT, 06902
USA
Phone: +1 (203) 323 7173
Fax: +1 (203) 323 0595
Email: info@us.mediasurface.com
Web: http://www.mediasurface.com