NORCON PLC
Norcon plc
Annual Report 2010
Registered Address: 
Fort Anne, Douglas, 
Isle of Man, IM1 5PD
Correspondence Address: 
5 Andrea Kalvou St., 
PO Box 54843, 
Limassol, Cyprus,CY 3728
www.norconplc.com
Tel: +357 25 736 830     
Fax: +357 25 736 831
Email: info@norconplc.com
 
 
 
Norcon plc 
2010 ANNUAL REPORT 
May 31, 2011 
 
 
 
 
 
 
 
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DIRECTORS, SECRETARY AND ADVISORS 2
HIGHLIGHTS 3
CHAIRMAN’S STATEMENT 4
CHIEF EXECUTIVE’S REVIEW 5
FINANCIAL REVIEW 7
BOARD OF DIRECTORS’ REPORT 9
INDEPENDENT AUDITORS’ REPORT 11
2010 CONSOLIDATED FINANCIALS 12
NOTES TO THE 2010 CONSOLIDATED FINANCIALS 16
NOTICE OF ANNUAL GENERAL MEETING 40
PROXY NOTICE 42
NORCON PLC
1
Contents Board of Directors: Trond Tostrup (Chairman)
Arnold Rørholt
Jørn Longem
Gaute Vik
Marne Martin (Corporate Secretary)
Kenneth West
Registered office: Fort Anne
Douglas
IM1 5PD
Isle of Man
Nominated Adviser: finnCap
60 New Broad Street
London EC2M 1JJ UK
Independent Auditors: PKF Savvides & Co Ltd
Certified Public Accountants
229 Arch. Makarios Avenue
Meliza Court
4th, 5th & 6th Floor
3105 Limassol – Cyprus
UK Solicitors: Eversheds LLP
One Wood Street
London EC2V 7WS
UK
Isle of Man Advocates: Cains Advocates Limited
Fort Anne
Douglas
Isle of Man IM1 5PD
Cyprus Solicitors: Chrysses Demetriades & Co.
Fortuna Court
284 Makarios III Avenue
3105 Limassol – Cyprus
Registrars Capita Registrars (Isle of Man)
3rd Floor, Exchange House
54-62 Athol Street
Douglas, Isle of Man IM1 1JD
Bankers: Bank of Cyprus Public Company Ltd
BNP Paribas, Cyprus
DnB NOR, Norway
Saudi Investment Bank, Saudi Arabia
National Bank of Abu Dhabi, UAE
National Bank of Kuwait, Kuwait
ABN Amro Bank N.V., Indonesia
HSBC Bank Middle East Limited, Oman
NORCON PLC
2
DIRECTORS, SECRETARY AND ADVISERS We the Board of Directors are happy to present to our Shareholders yet another profitable year. Management has worked
diligently to conclude a profitable outturn to the year. Our core client relationships have been maintained and in some cases
strengthened and we also continue to make progress in expanding our presence in core target markets such as the Middle
East, Africa and Southeast Asia. At the same time, we remain optimistic about the long term prospects in our target markets
around the world given the fundamental demand drivers in those markets.
The highlights of our year are referenced below:
Financial Highlights
Trading has been consistent with the management team’s revised FY expectations:
• Revenue of US$68.6m (FY 2009: US$78.2m)
• Operating profits of US$7.3m (FY 2009: US$11.6m)
• Profit before tax of US$6.7m (FY 2009: US$10.7m) 
• Profit after tax of US$4.3m (FY2009: US$7.7m)
• Cash at year-end of US$12.1m
– Strengthened by US$6.3m Placing successfully closed in 2010
– Operational cash conversion significantly stronger in H2 with net cash of US$6.1m at year end
• Pro forma earnings per share on a basic basis of US$0.09 (FY 2009: US$0.19) with weighted average number of shares
increasing by 5.9 million shares
• Consistent dividend policy of at least 50% of net income, with a Board recommendation that a final dividend for 2010
results of US$2.36 cents per share be payable to all shareholders on the register as of 24 June 2011, subject to
shareholder approval at the Company’s general meeting.
Operational Highlights
Important strategic gains made both in core markets and in defined future growth areas:
• Important renewals secured or underway in Middle East markets, where the demand environment remains strong 
• Diversification efforts continue, with wins in new verticals and new geographies
• Favourable long-term market drivers for growth
NORCON PLC
3
  I am pleased to report that the Company has, in a challenging year, delivered a profitable set of final results for the year ended
31 December 2010.
As we advised in our Trading Update of 10 December 2010, a number of challenges affected our financial performance this
year.  Some contracts with new clients were slower to emerge than first anticipated, mainly due to M&A activities amongst
telecom operators with which we had previously been in advanced discussions, in addition to associated regulatory issues
that caused delays to other potential projects. This coupled with unusual end of service costs of specific personnel and
aborted acquisition activities had the impact of reducing gross and net margins. We have worked diligently in spite of these
challenges this year to maintain a profitable performance as a business whilst, at the same, continued with our efforts to move
our strategic expansion plans forward. As a consequence, our position as an independent market leader in our core markets
has been maintained. We are also pleased to have further strengthened our Company’s operational cash flow conversion rates
during 2010.
Our efforts to further expand geographically, and into new end-markets, have continued in to the start of 2011 and will be our
focus throughout the year ahead. We are seeing some of the delayed projects advance and further opportunities with new
clients to support our 2011 expectations and longer term growth ambitions.
While Norcon has not in 2010 been able to achieve growth, we have demonstrated the inherent stability of our business in
core markets and that of our client relationships. 
We have a strong, flexible and highly capable team at Norcon and I would like to thank my Board colleagues and each of our
employees for their commitment, enthusiasm and efforts this year.
Trond Tostrup
Chairman
NORCON PLC
4
Chairman’s Statement Strategic Progress
This year has seen Norcon take further steps to implement its diversification strategy. Where opportunities to expand our
services in to new market verticals have emerged, we have taken advantage of them. In addition, where opportunities to work
with new or existing clients in new target geographies have come to light, we have worked hard to prove our capabilities, win
new mandates and broaden our footprint.
Demand drivers continue to support our strategy. Globally, the demand for outsourcing and project management services
continues to grow in the telecoms sector. 4G deployments are under discussion in Scandinavia and we have already
positioned ourselves to take advantage of this long term opportunity by opening an office in the region in spring 2010. The
unrest seen in parts of the Middle East has not impacted our operations in the markets where we are present. We therefore
continue to see a strong demand there for the services that we offer.
A number of multinational telecom operators are pursuing plans to further transform their networks: a trend that we also
expect to benefit from as it develops. Likewise, the defence business has remained stable from prior years, with some
opportunity for new projects in that sector as well. Trends like these represent a strengthening opportunity for Norcon to grow
the level of business it undertakes for existing clients, as well as to expand its customer base.
Our business with our core clients has remained stable. These strong client relationships present the Company with the
potential for additional geographical growth as existing clients enter new territories. We also continue to see opportunities to
develop into new, complementary service areas.
Operational Focus
Despite a year-on-year reduction in turnover and profits, due to the challenges outlined above by our Chairman, and against
high comparative numbers from 2009, the core of our business has delivered a robust performance and the Group has
remained profitable during the year with improved cash conversion.
Norcon’s relationships with its core customers remain as strong as ever with client retention rates remaining well above 90%
consistent with prior years. We have also placed particular emphasis on our business development efforts, working hard to
convert pipeline prospects during 2010.
Routes to Growth
We aim to grow our long-term outsourcing and project management business organically. In pursuit of this aim our focus will
continue to rest both on client retention and new contract wins with both current and new clients in new territories.
Norcon will continue to look at opportunities to further extend into the Southeast Asian and African regions, as well as into
Scandinavia where we have already boosted our presence so far this year. This may involve following our clients as they
themselves expand internationally, as we have done with a key telecommunications client in Scandinavia: supporting it both at
home and, now, in projects in its own international markets. This may also involve joint-ventures or partnerships, where other
local partners can complement our existing consultancy strengths.
Dividend
The Company paid its first interim dividend of US$1m in November 2010. The Board had re-confirmed in early April its
dividend policy of paying out at a dividend of at least 50% of net income when the annual accounts for 2010 had been
approved.
As of today, the Board of Directors recommended a final dividend of US$1.15m, in an amount of US$0.02356133 per ordinary
share in respect of the financial year ended 31 December 2010. This final dividend is to be paid to all holders of ordinary shares
appearing in the register of members of the Company at 24 June 2011 (“the Record Date”), subject to shareholder approval
at the Annual General Meeting of Shareholders on 27 June 2011.
NORCON PLC
5
Chief Executive’s Review People
On behalf of the Company, I would like to take this opportunity to thank all our employees for their excellent commitment,
contribution and hard work during the year. I would also like to welcome the new employees and joint venture partners in new
geographical territories who have joined our group this year.
Outlook
We remain positive about our prospects for 2011 and are also confident that opportunities exist for Norcon to continue to
grow organically over the longer term.
Arnold Rørholt
Chief Executive Officer
NORCON PLC
6
Chief Executive’s Review continued We are pleased to release our audited numbers for the full year 2010.
Summary
Norcon’s performance during the past twelve months has been profitable, albeit at a lower level than in the prior year as
explained above, with improved cash generation from operations and a stronger net asset position as year-end positives.
Revenue for 2010 totalled US$68.6m (FY2009: US$78.2m). The decrease was primarily due to due to M&A activities amongst
telecom operators with which Norcon has been in advanced discussions and associated regulatory issues causing delays
and/or potential project elimination. Gross profit for 2010 was US$12.2m (FY2009: US$15.6m).
Gross margin for 2010 was 18% for the year (FY 2009: 20%), due to increased cost of sales related to increased accruals
and expenses in 2010.
Profit before Tax of US$6.7m for 2010 compared to the 2009 figure of US$10.7m due to higher than expected expenses
related to unusual end of service costs of specific personnel and aborted acquisition activities.
Profit after tax was US$4.3m for 2010 compared to the 2009 result of US$7.7m. The percentage tax accrued for 2010 was
36% versus 28% in 2009 due to the significantly greater non-tax deductible expenses in 2010. Such non-tax deductible
expenses in 2010 shall yield tax benefits in future periods. The underlying tax rates in the respective jurisdictions were
unchanged.
Pro forma basic earnings per share were US$0.9 for the full year 2010 compared to the US$0.18 earnings per share for 2009.
The weighted average number of shares in 2010 was 47,174,875 and in 2009 41,312,771 respectively.
Costs
Cost of sales totaled US$56.4m for 2010 compared to US$62.5m in 2009.
Other operating costs, including net financial, operating and administration expenses totaled US$4.9m for 2010 up from
US$4.2m in 2009. This increase is primarily due to placing and due diligence expenses.
Net other costs decreased to US$0.6m from US$0.8m, largely related to the decrease in the accrual related to the Long Term
Incentive Program.
Taxation 
Taxes were accrued in the amount of US$2.4m during 2010 (FY 2009: US$3.0m). The blended effective tax rate based on
the tax accruals made for each business unit increased to 36% in 2010 from 28% in 2009. This substantial increase in the
blended rate is largely related to the timing of accruals related to amounts dis-allowable for tax calculations, which were
significantly higher in 2010 than 2009. The underlying tax rates in the countries in which we operate are unchanged.
Foreign Exchange 
Foreign exchange translation gains and losses in the period remain non material. The Company is continuing its policy of
denominating revenue and expenses either in the local currency if pegged to the US dollar or in US dollars to the extent
feasible.
Cash Flow
Cash flow continues to be positive for the year as a whole. Cash conversion accelerated in 2010 compared to 2009, with cash
conversion of approximately 100% of operating profits. This is the first time the Company has been able to achieve this metric.
Balance Sheet
The Balance Sheet performance of the Company was quite strong. Net cash balances improved year on year by
approximately US$5.5m. As at 31 December 2010, cash was US$12.1m (FY2009: US$7.2m) with positive net cash of
NORCON PLC
7
Financial Review
  US$6.1m (FY2009:US$0.5m), reflecting the decreased utilisation of the short term loan, the balance of which was $6.0m as
at year end 2010 (FY 2009: US$6.4m) related to short term accounts receivable factoring.
The Company remains net asset positive, with net assets increasing significantly to US$22.8m in 2010 (FY 2009: US$17.0m).
Total trade and other receivables decreased to US$31.6m from US$38m in the prior year. Trade and unbilled receivable
balances decreased year on year to a total of US$24.6m from a total of US$25.7m. Retentions receivable decreased to
US$3.9 m compared to US$8.5 m in 2009.
Trade payables have decreased significantly to US$4.0m as of year-end 2010 compared to US$12.9m in the preceding year.
In non-current liabilities, the accrual related to employees terminal benefits increased to US$9.8m from US$7.3m. This
US$2.5m increase in the accrual had the effect of decreasing earnings due to the accrued expense and because such
expense was largely disallowable, increasing the effective tax rate.
Relating to the 2010 earnings, a US$1.0m interim dividend was paid in November 2010. On 31 May 2011, the Board of
Directors recommended the payment of a final Dividend related to 2010 profits of US$2.15m in aggregate, of which the
residual to be paid is US$1.15m. Retained earnings and other reserves totaled US$21.9m as at the end of 2010 compared
to US$16.1m as at the end of the 2009.
International Financial Reporting Standards (IFRS) 
The Consolidated Financial Statements of Norcon and its branches and subsidiary companies have been audited by PKF
Savvides&Co Ltd., the Company’s auditor. These consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRSs) as adopted by the European Union (EU) under the historical cost
convention.
Marne Martin
Chief Financial Officer
NORCON PLC
8
Financial Review continued  The Board of Directors presents its report and audited consolidated financial statements of NORCON PLC and its subsidiaries
(the Group) for the year ended 31 December 2010.
Incorporation
The Company NORCON PLC was incorporated in the Isle of Man on 2 June 2008 (Registered Number 002730V), as a
company limited by shares under the Isle of Man Companies Act 2006. On 28 July 2008, the Company became public and
had been admitted for trading at the AIM Market of the London Stock Exchange.
Principal activities
The principal activities of the Group, which are unchanged from last year, are the provision of project management and
outsourcing services as well as consulting engineers. The Group comprises of the holding company Norcon PLC, registered in
the Isle of Man, the subsidiary company Norconsult Telematics Limited, registered in Cyprus (which includes
branches/operations in Saudi Arabia, U.A.E. Abu Dhabi, Kuwait, Indonesia and Qatar) and its subsidiary companies Norconsult
Telematics and Company LLC registered in the Sultanate of Oman, Norconsult Telematics AS registered in Norway, Norcon
Global Management & Consulting Ltd registered in Cyprus and the associate company Norconsult Telematics (Saudi) Ltd
registered in the Kingdom of Saudi Arabia.
Review of current position, future developments and significant risks
The Group’s development to date, financial results and position as presented in the financial statements are considered
satisfactory.
The main risks and uncertainties faced by the Group and the steps taken to manage these risks are described in note 3 of
the financial statements.
Results and Dividends 
The Group’s results are set out in the following pages. The Board of Directors recommends the payment of a dividend as
detailed below and the remaining net profit for the year is retained.
Dividends
In July 2010, The Board of Directors paid a dividend of US$3,860,000 out of the 2009 profits (2008:US$3,220,000), and on
3 December 2010, paid an interim dividend of US$1,000,000 out of the first half 2010 profits. The Board of Directors remains
committed to maintaining the policy established upon the IPO in 2008 of paying a dividend of at least 50% on the year’s net
profit after tax.
Share capital
Authorised Share capital 
Under its Memorandum the Company fixed its share capital at 100,000,000 ordinary shares of nominal value of Stg£0.01 each.
Issued capital
The Company was admitted to trading on 28 July 2008 on the AIM Market of the London Stock Exchange and issued
41,123,188 ordinary shares of nominal value of Stg£0.01 each. In connection with the listing a total of 2,246,376 ordinary
shares were sold to new investors out of which 1,123,188 were issued at a share premium of Stg£0.68 per share and were
new shares whilst the other 1,123,188 were sold by existing shareholders.
On 9 October 2009, the company made the first issue of its LTIP Award plan for 758,833 ordinary shares of Stg£0.01 each,
which were admitted for trading on the AIM Market of the London Stock Exchange. The total number of shares issued
following the admission of these ordinary shares was 41,881,521 (Note 22).
NORCON PLC
9
Board of Directors Report On 29 March 2010, the company issued 3,521,668 new ordinary shares of Stg£0.01 each at a share premium of Stg£0.74
per share (cum-dividend). On 9 April 2010 the company issued 2,639,286 ordinary shares of Stg£0.01 each at a share
premium of Stg£0.69 per share (ex-dividend).
On 28 July 2010, the company made the second issue of LTIP Award plan for 758,333 ordinary shares Stg£0.01 each. The
total number of shares issued thereafter was 48,800,808 ordinary shares (Note 22).
For comparative purposes, the 2009 results presented here are compared to the audited 2008 numbers (the consolidated
numbers for the period from 1 January to 1 June 2008 of Norcon’s 100% subsidiary Norconsult Telematics Ltd. (“NTL”) and
Norcon consolidated numbers for the period from 2 June to 31 December 2008): the same convention as followed last year
in the annual results financial review).
Board of Directors
The members of the Group’ s Board of Directors as at 31 December 2010 and at the date of this report are presented. All directors
presently members of the Board continue in office.
Events after the reporting period 
Any significant events that occurred after the end of the reporting period are described in note 31 to the financial statements.
Independent Auditors
The Independent Auditors, PKF Savvides & Co Ltd, have expressed their willingness to continue in office and a resolution
giving authority to the Board of Directors of Directors to fix their remuneration will be proposed at the Annual General Meeting.
By order of the Board of Directors,
Director
Limassol – Cyprus, 11 April 2011
NORCON PLC
10
Board of Directors Report continued PKF Savvides & Co Ltd
Accountants &
business advisers
To the Members of NORCON PLC
Report on the Consolidated Financial Statements
We have audited the consolidated financial statements of the parent company NORCON PLC (the “Company”) and its
subsidiaries (“the Group”), which comprise the consolidated statement of financial position as at 31 December 2010, and the
consolidated statements of comprehensive income, changes in equity and cash flows for the year then ended, and a summary
of significant accounting policies and other explanatory notes.
Board of Directors’ Responsibility for the Consolidated Financial Statements 
The Board of Directors is responsible for the preparation of consolidated financial statements that give a true and fair view in
accordance with International Financial Reporting Standards as adopted by the European Union (EU). This responsibility
includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of
consolidated financial statements that are free from material misstatement, whether due to fraud or error; selecting and
applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.
Auditor’s Responsibility 
Our responsibility is to express an opinion on these consolidated financial statements based on our audit. We conducted our
audit in accordance with International Standards on Auditing. Those Standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance whether the consolidated financial statements
are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the consolidated
financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of
material misstatement of the consolidated financial statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the entity’s preparation of consolidated financial statements
that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board of Directors
as well as evaluating the overall presentation of the consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the consolidated financial statements give a true and fair view of the financial position of NORCON PLC and
its subsidiaries as at 31 December 2010, and of its financial performance and their cash flows for the year then ended in
accordance with International Financial Reporting Standards as adopted by the EU.
Other Matters
This report, including the opinion, has been prepared for and only for the Company’s members as a body and for no other
purpose. We do not, in giving this opinion, accept or assume responsibility for any other purpose or to any other person to
whose knowledge this report may come to.
PKF Savvides & Co Ltd
Certified Public Accountants
Limassol, 11 April 2011
NORCON PLC
11
Independent Auditors’ Report 2010 2009
Note US$ US$
Revenue 6 68.597.874 78.174.068
Cost of Sales (56.445.691) (62.531.380)
––––––––––– –––––––––––
12.152.183 15.642.688
Net profit from investing activities 7 16.574 72.207
Administration expenses (4.881.176) (4.134.894)
Other expenses 8 (269) (483)
––––––––––– –––––––––––
Operating profit 9 7.287.312 11.579.518
Finance costs 11 (572.476) (843.109)
Share of results of associates before tax (1.365) (695)
––––––––––– –––––––––––
Profit before tax 6.713.471 10.735.714
Tax 12 (2.421.186) (3.011.639)
––––––––––– –––––––––––
Net Profit for the Year 4.292.285 7.724.075
Other comprehensive income – –
––––––––––– –––––––––––
Total comprehensive income for the year 4.292.285 7.724.075
––––––––––– –––––––––––
––––––––––– –––––––––––
Attributable to:
Equity holders of the parent 4.294.586 7.727.754
––––––––––– –––––––––––
Minority interest (2.301) (3.679)
4.292.285 7.724.075
––––––––––– –––––––––––
––––––––––– –––––––––––
Basic earnings per share attributable to equity holders of the parent (cent) 13 9,10 18,71
––––––––––– –––––––––––
––––––––––– –––––––––––
Diluted earnings per share attributable to equity holders of the parent (cent) 13 8,72 17,63
––––––––––– –––––––––––
––––––––––– –––––––––––
NORCON PLC
12
Consolidated Statement of Comprehensive Income
Year ended 31 December 2010
The notes on pages 16 to 36 form an integral part of these consolidated financial statements. 2010 2009
Notes US$ US$
ASSETS
Non current assets
Property, plant and equipment 15 178.334 93.270
Investments in associated undertakings 16 591.560 592.925
–––––––––––– ––––––––––––
769.894 686.195
–––––––––––– ––––––––––––
Current assets
Trade and other receivables 17 31.556.403 37.993.477
Cash at bank and in hand 18 12.075.188 7.192.521
–––––––––––– ––––––––––––
43.631.591 45.185.998
–––––––––––– ––––––––––––
Total assets 44.401.485 45.872.193
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
EQUITY AND LIABILITIES
Equity
Share capital 19 937.100 833.117
Other reserves 20 14.569.790 8.093.742
Retained earnings 7.324.122 8.035.624
–––––––––––– ––––––––––––
22.831.012 16.962.483
Non controlling interests 12.005 14.306
–––––––––––– ––––––––––––
Total equity 22.843.017 16.976.789
–––––––––––– ––––––––––––
Non current liabilities
Employees’ terminal benefits 23 9.786.806 7.300.495
–––––––––––– ––––––––––––
9.786.806 7.300.495
–––––––––––– ––––––––––––
Current liabilities
Trade and other payables 24 3.966.278 12.858.948
Borrowings 21 6.019.868 6.687.133
Current tax liabilities 25 1.785.516 2.048.828
–––––––––––– ––––––––––––
11.771.662 21.594.909
–––––––––––– ––––––––––––
Total liabilities 21.558.468 28.895.404
–––––––––––– ––––––––––––
Total equity and liabilities 44.401.485 45.872.193
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
On 11 April 2011 the Board of Directors of NORCON PLC authorised these financial statements for issue.
................................................... ................................................... ...................................................
Gaute Vik Marne Elizabeth Martin Trond Tostrup
Director Director Director
NORCON PLC
13
Consolidated Statement of Financial Position
31 December 2010
The notes on pages 16 to 36 form an integral part of these consolidated financial statements. Attributable to equity holders of the Company
Other 
Share reserves Retained Non controlling
Note capital (Note 20) earnings Total interests Total
US$ US$ US$ US$ US$ US$
Balance at 1 January 2009 820.655 7.629.328 3.460.782 11.910,765 18.056 11.928.821
Issue of share capital 19 12.462 – 12.462 – 12.462
Total comprehensive income – – 7.727.754 7.727.754 (3.679) 7.724.075
Dividends 14 – – (3.220.000) (3.220.000) – (3.220.000)
Exchange difference arising on the
translation and consolidation of
foreign companies’ financial statements – (102.270) 67.088 (35.182) (71) (35.253)
Equity settled employee benefits reserve – 566.684 – 566.684 – 566.684
––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––
Balance at 31 December
2009/1 January 2010 833.117 8.093.742 8.035.624 16.962.483 14.306 16.976.789
Issue of share capital 19 103.983 6.257.283 6.361.266 – 6.361.266
Total comprehensive income  – – 4.294.586 4.294.586 (2.301) 4.292.285
Dividends 14 – – (4.860.000) (4.860.000) – (4.860.000)
Equity settled employee benefits reserve – 233.340 – 233.340 – 233.340
Exchange difference arising on the translation
and consolidation of foreign companies’
financial statements – (14.575) (146.088) (160.663) – (160.663)
––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––
Balance at 31 December 2010 937.100 14.569.790 7.324.122 22.831.012 12.005 22.843.017
––––––––––– ––––––––––– ––––––––––– ––––––––––– ––––––––––– –––––––––––
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NORCON PLC
14
Consolidated Statement of Changes in Equity
Year ended 31 December 2010
The notes on pages 16 to 36 form an integral part of these consolidated financial statements. 2010 2009
Note US$ US$
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax 6.713.471 10.735.714
Adjustments for:
Depreciation of property, plant and equipment 15 53.307 50.752
Exchange difference arising on the translation of non current assets in foreign currencies (1.033) 4.477
Exchange difference arising on the translation and consolidation of foreign companies
financial statements (160.663) (35.253)
Share of loss from associates 16 1.365 695
Loss from the sale of property, plant and equipment 269 483
Profit from the closing down of subsidiary – (7.861)
Interest income 7 (16.574) (64.346)
Interest expense 11 322.657 301.892
Expense recognized in comprehensive income in respect of equity settled
share based payments 233.340 566.684
–––––––––––– ––––––––––––
Cash flows from operations before working capital changes 7.146.139 11.553.237
Decrease/(increase) in trade and other receivables 6.437.074 (6.005.304)
(Decrease)/increase in trade and other payables (8.892.670) 2.634.907
Increase in employees’ terminal benefits 2.486.311 1.136.693
–––––––––––– ––––––––––––
Cash flows from operations 7.176.854 9.319.533
Tax paid (2.684.498) (2.964.089)
–––––––––––– ––––––––––––
Net cash flows from operating activities 4.492.356 6.355.444
–––––––––––– ––––––––––––
CASH FLOWS FROM INVESTING ACTIVITIES
Payment for purchase of property, plant and equipment 15 (137.607) (13.719)
Proceeds from disposal of property, plant and equipment – 789
Proceeds from the closing down of subsidiary – 7.861
Interest received 16.574 64.346
–––––––––––– ––––––––––––
Net cash flows (used in)/from investing activities (121.033) 59.277
–––––––––––– ––––––––––––
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of share capital 6.361.266 12.462
Repayments of borrowings (501.208) (4.208.167)
Interest paid (322.657) (301.892)
Dividends paid (4.860.000) (3.220.000)
–––––––––––– ––––––––––––
Net cash flows from/(used in) financing activities 677.401 (7.717.597)
–––––––––––– ––––––––––––
Net increase/(decrease) in cash and cash equivalents 5.048.724 (1.302.876)
Cash and cash equivalents:
At beginning of the year 6.944.227 8.247.103
–––––––––––– ––––––––––––
At end of the year 18 11.992.951 6.944.227
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
NORCON PLC
15
Consolidated Statement of Cash Flows
Year ended 31 December 2010
The notes on pages 16 to 36 form an integral part of these consolidated financial statements. NORCON PLC
16
1. Incorporation and principal activities 
Country of incorporation 
The Company NORCON PLC (the “Company”) was incorporated in the Isle of Man on 2 June 2008, as a company limited
by shares under the Isle of Man Companies Act 2006. On the 28 July 2008, the company became public and had been
admitted for trading at the AIM Market of the London Stock Exchange. Its registered office is at Fort Anne, Douglas, IM1 5PD,
Isle of Man.
Principal activities 
The principal activities of the Group, which are unchanged from last year, are the provision of project management and
outsourcing services as well as consulting engineers. The group comprises of the holding company Norcon PLC, registered
in the Isle of Man, the subsidiary company Norconsult Telematics Limited, registered in Cyprus (which includes
branches/operations in Saudi Arabia, U.A.E. Abu Dhabi, Kuwait, Indonesia and Qatar) and its subsidiary companies
Norconsult Telematics and Company LLC registered in the Sultanate of Oman, Norconsult Telematics AS registered in Norway,
Norcon Global Management & Consulting Ltd registered in Cyprus and the associate company Norconsult Telematics (Saudi)
Ltd registered in the Kingdom of Saudi Arabia.
2. Accounting policies 
The principal accounting policies adopted in the preparation of these consolidated financial statements are set out below.
These policies have been consistently applied to all years presented in these consolidated financial statements unless
otherwise stated.
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). The consolidated financial statements have been prepared under the
historical cost convention.
The preparation of financial statements in conformity with IFRSs requires the use of certain critical accounting estimates and
requires Management to exercise its judgment in the process of applying the Group’s accounting policies. It also requires the
use of assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.
Although these estimates are based on Management’s best knowledge of current events and actions, actual results may
ultimately differ from those estimates.
Adoption of new and revised IFRSs 
During the current period the Group adopted all the new and revised IFRSs and International Accounting Standards (IAS),
which are relevant to its operations.
At the date of authorisation of these financial statements some Standards were in issue but not yet effective. The Board of
Directors expects that the adoption of these Standards in future periods will not have a material effect on the consolidated
financial statements of the Group.
Basis of consolidation
The Group consolidated financial statements comprise the financial statements of the parent company NORCON PLC and
the financial statements of the following: Norconsult Telematics Ltd, including Saudi Arabia, U.A.E. Abu Dhabi, Qatar, Kuwait
and South East Asia branches of the company and the subsidiary companies Norconsult Telematics and Company LLC,
registered in the Sultanate of Oman, Norconsult Telematics AS registered in Norway and Norcon Global Management &
Consulting Ltd registered in Cyprus and the activity of the associate company Norconsult Telematics (Saudi) Ltd, registered
in the Kingdom of Saudi Arabia.
The consolidated financial statements include the audited financial statements of subsidiary Norconsult Telematics Ltd and
Saudi Arabia, U.A.E. Abu Dhabi, Qatar, Kuwait and South East Asia branches. The financial statements of Saudi Arabia
branch, the Saudi Arabia associate and Norway subsidiaries are prepared in accordance with local accepted accounting
standards. The financial statements of the U.A.E. Abu Dhabi, Kuwait and South East Asia branches and the Oman subsidiary
are prepared in accordance with International Financial Reporting Standards.
Notes to the Consolidated Financial Statements
Year ended 31 December 2010 2. Accounting policies (continued)
The Branch in Saudi Arabia is registered under a temporary license (No. 767) expiring on 17 August 2011.
The Branch in Abu Dhabi, UAE operates under Commercial Registration No.1003263 from the Department of Economic
Development which expires on 29 December 2011.
All inter company transactions and balances between Group companies have been eliminated during consolidation. The
financial statements are prepared in United States Dollars. The exchange rates used for the translation of the financial
statements are shown in note 28.
The consolidated financial statements have been prepared under IFRS but do not fall under the scope of IFRS 3 in relation to
the combination of the company and its direct subsidiary Norconsult Telematics Ltd. The acquisition of the shares in
Norconsult Telematics Ltd by Norcon PLC is considered to be a combination of entities under common control.
In the absence of an IFRS that specifically applies to this transaction the company has relied on the hierarchy in IAS 8,
paragraphs 10 12 to decide on the appropriate accounting treatment. Specifically, the following relevant hierarchy has been
checked whether it applies to the transaction:
• IFRS and interpretations
• Definitions, recognition and measurement principles in the framework
• Recent pronouncements for other standard setting bodies with similar framework
• Other accounting literature
• Accepted industry practice
The income and expenses of the subsidiary are included in the consolidated financial statements from the date of the
combination. The underlying carrying amount of the assets and liabilities of the subsidiaries have been recorded on the
combination date. When the cost of acquiring of the shares in the subsidiary company is less that the respective underlying
net assets value of this subsidiary, the difference is credited to a merger reserve in the shareholder’s equity.
Business combinations 
The acquisition of subsidiaries in Norconsult Telematics Limited is accounted for using the purchase method. The cost of the
acquisition is measured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or
assumed, and equity instruments issued by the Group in exchange for control of the acquiree, plus any costs directly
attributable to the business combination. The acquiree's identifiable assets, liabilities and contingent liabilities that meet the
conditions for recognition under IFRS 3 are recognised at their fair values at the acquisition date, except for non current assets
(or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non Current Assets Held for Sale and
Discontinued Operations, which are recognised and measured at fair value less costs to sell.
Goodwill arising on acquisition is recognised as an asset and initially measured at cost, being the excess of the cost of the
business combination over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities
recognised. If, after reassessment, the Group’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and
contingent liabilities exceeds the cost of the business combination, the excess is recognised immediately in profit or loss.
The interest of minority shareholders in the acquiree is initially measured at the minority's proportion of the net fair value of the
assets, liabilities and contingent liabilities recognised.
Minority interests in the net assets (excluding goodwill) of consolidated subsidiaries are identified separately from the Group’s
equity therein. Minority interests consist of the amount of those interests as the date of the original business combination and
the minority's interest in the subsidiary's equity are allocated against the interests of the Group except to the extent that the
minority has a binding obligation and is able to make an additional investment to cover the losses.
Associates
Associates are all entities over which the Group has significant influence but not control, generally accompanying a
shareholding of between 20% and 50% of the voting rights. Investments in associates are initially recognised at cost and are
accounted for by the equity method of accounting.
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010
NORCON PLC
17 NORCON PLC
18
2. Accounting policies (continued)
Segmental reporting 
A segment is a component of the Group distinguishable by economic activity (business segment), or by its geographical
location (geographical segment), which is subject to risks and rewards that are different from those of other segments.
Revenue recognition 
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the group and the revenue can
be reliably measured, regardless of when the payment is being made.
Revenue comprises the fair value of the consideration received or receivable as per the invoiced amount for the sale of goods
and services net of rebates and discounts. Revenues earned by the Group are recognised on the following bases:
• Rendering of services
Sales of services are recognised in the accounting period in which the services are rendered by reference to completion
of the specific transaction assessed on the basis of the actual service provided as a proportion of the total services to
be provided.
• Work executed 
Revenue from a contract to provide services is recognized by reference to the progress of completion of the contract
based on the provisions of each contract.
Revenue from time and material contracts is recognized at the contractual rates as labour hours are delivered and direct
expenses are incurred and is based on the value of work performed as well as on time spent on each contract.
Revenue is recognised on the percentage of completion basis. No profit is taken until the related contract has
progressed to the point where the ultimate realizable profit can be determined reasonably. On other contracts, revenue
is recognized based on the value of work performed. Where the contract outcome cannot be measured reliably, revenue
is recognised only to the extent that the expenses incurred are eligible to be recovered.
• Interest income
Interest income is recognised based on an accrual basis.
Employee benefits
Provision is made for amounts payable under GCC laws and regulations applicable to employees’ accumulated period of
service at the balance sheet date.
Equity-settled share based payment
Equity settled share payments to employees and directors are measured at the fair value of the equity instrument as of the
grant date 28 July 2008 or the date a significant change to the vesting condition made, the most recent of which date was
16 December 2008.
The fair value of the equity settled share based payment is expensed over the vesting period. The corresponding increase in
equity is credited directly to shareholders’ equity.
This policy is applied to all equity settled share based benefits which were granted on 28 July 2008 and considered as earned
upon approval of the remuneration committee in the given year with vesting as of the anniversary date 28 July in the given year.
The first year's vesting condition has been confirmed as satisfied by the remuneration committee as of the vesting date of
28 July, 2009 based on the confirmation by the committee as of 30 March 2009 that the net income condition was met related
to the approved plan.
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010 2. Accounting policies (continued)
The second year’s vesting condition has been met and confirmed by the remuneration committee on 22 March 2010 with
vesting on 28 July 2010. Subsequently based on this year's results the vesting condition for the 2010 financial year has not
been met and therefore no additional shares will be issued to qualified employees for the year 2011.
Debtors and provisions for bad debts
Bad debts are written off to the consolidated statement of comprehensive income and a specific provision is made, where it
is considered necessary. No general provision for bad debts is made. Trade debtors are stated after deducting the specific
provision for bad and doubtful debts, if any.
Finance income 
Finance income includes interest income which is recognised based on an accrual basis.
Finance costs 
Interest expense and other borrowing costs are charged to the consolidated statement of comprehensive income as incurred.
Foreign currency translation
(1) Functional and presentation currency
Items included in the Group’s financial statements are measured using the currency of the primary economic
environment in which the entity operates (‘the functional currency’). The financial statements are presented in United
States Dollars (US$), which is the Group's functional and presentation currency.
(2) Translation from functional to presentation currency
For the purpose of presenting consolidated financial statements, the assets and liabilities of the Group’s foreign
operations are expressed in United States dollars using exchange rates prevailing at the statement of financial position
date. Income and expense items are translated at the average exchange rates for the period, unless exchange rates
fluctuated significantly during that period, in which case the exchange rates at the transactions are used. The exchange
rates used are disclosed in note 28. Exchange differences arising, if any, are classified as equity and recognised in the
Group's foreign currency translation reserve. Such exchange differences are recognised in the statement of
comprehensive income in the period in which the foreign operation is disposed of.
(3) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates
of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the
translation at year end exchange rates of monetary assets and liabilities denominated in foreign currencies are
recognised in the consolidated statement of comprehensive income.
Tax 
Current tax liabilities and assets are measured at the amount expected to be paid to or recovered from the taxation authorities,
using the tax rates and laws that have been enacted, or substantively enacted, by the reporting date.
Dividends 
Interim dividends are recognised in equity in the year in which they are declared. Proposed dividends are recorded in the
Group's financial statements in the year in which they are approved by the Group’s shareholders.
Property, plant and equipment 
Property, plant and equipment are stated at historical cost less accumulated depreciation and any accumulated impairment
losses.
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010
NORCON PLC
19 2. Accounting policies (continued)
Depreciation is calculated on the straight line method so as to write off the cost of each asset to its residual value over its
estimated useful life. The annual depreciation rates used are as follows:
%
Motor vehicles 15 – 33,33
Furniture, fixtures and office equipment 15 – 33,33
Computer hardware and software – cost 20 – 33,33
The assets residual values and useful lives are reviewed, and adjusted if appropriate, at each reporting date.
Where the carrying amount of an asset is greater than its estimated recoverable amount, the asset is written down immediately
to its recoverable amount.
Gains and losses on disposal of property, plant and equipment are determined by comparing proceeds with carrying amount
and are included in the consolidated statement of comprehensive income.
Financial instruments 
Financial assets and financial liabilities are recognised in the Group’s consolidated statement of financial position when the
Group becomes a party to the contractual provisions of the instrument.
Trade receivables
Trade receivables are measured at initial recognition at fair value, and are subsequently measured at cost. Appropriate
allowances for estimated irrecoverable amounts are recognised in profit or loss when there is objective evidence that the asset
is impaired. The allowance recognised is measured as the difference between the asset's carrying amount and the present
value of estimated future cash flows.
Investments
The Group classifies its investments in equity and debt securities in the following categories: financial assets at fair value
through profit or loss, held to maturity investments and available for sale financial assets. The classification depends on the
purpose for which the investments were acquired. Management determines the classification of investments at initial
recognition and re evaluates this designation at every reporting date.
• Financial assets at fair value through profit or loss
This category has two sub categories: financial assets held at fair value through profit and loss and those designated at
fair value through profit or loss at inception. A financial asset is classified in the held at fair value through profit and loss
category if acquired principally for the purpose of generating a profit from short term fluctuations in price. Assets in this
category are classified as current assets if they are either held at fair value through profit and loss or are expected to be
realised within twelve months from the reporting date.
• Held-to-maturity investments
Investments with fixed or determinable payments and fixed maturity that the Management has the positive intent and
ability to hold to maturity, other than loans and receivables originated by the Group, are classified as held to maturity
investments. Such investments are included in non current assets, except for maturities within twelve months from the
reporting date, which are classified as current assets.
• Available-for-sale financial assets
Investments intended to be held for an indefinite period of time, which may be sold in response to needs for liquidity or
changes in interest rates, are classified as available for sale; these are included in non current assets unless Management
has the express intention of holding the investment for less than 12 months from the reporting date or unless they will need
to be sold to raise operating capital, in which case they are included in current assets.
NORCON PLC
20
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010 2. Accounting policies (continued)
Regular way purchases and sales of investments are recognised on trade date which is the date on which the Group commits
to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial assets not
carried at fair value through profit or loss. Investments are derecognised when the rights to receive cash flows from the
investments have expired or have been transferred and the Group has transferred substantially all risks and rewards of ownership.
Available for sale financial assets and financial assets at fair value through profit or loss are subsequently carried at fair value.
Loans and receivables and held to maturity investments are carried at amortised cost using the effective interest method.
Realised and unrealised gains and losses arising from changes in the fair value of financial assets at fair value through profit or
loss are included in the consolidated statement of comprehensive income in the period in which they arise. Unrealised gains and
losses arising from changes in the fair value of available for sale financial assets are recognised in other comprehensive income
and then in equity. When available for sale financial assets are sold or impaired, the accumulated fair value adjustments are
included in the consolidated statement of comprehensive income.
The fair values of quoted investments are based on current bid prices. If the market for a financial asset is not active (and for
unlisted securities), the Group establishes fair value by using valuation techniques. These include the use of recent arm's length
transactions, reference to other instruments that are substantially the same and discounted cash flow analysis, making maximum
use of market inputs and relying as little as possible on entity specific inputs. Equity investments for which fair values cannot be
measured reliably are recognised at cost less impairment.
The Group assesses at each reporting date whether there is objective evidence that a financial asset or a group of financial assets
is impaired. In the case of equity securities classified as available for sale, a significant or prolonged decline in the fair value of the
security below its cost is considered as an indicator that the securities are impaired. If any such evidence exists for available for
sale financial assets the cumulative loss which is measured as the difference between the acquisition cost and the current fair
value, less any impairment loss on that financial asset previously recognised in profit or loss, is removed from equity and
recognised in the consolidated statement of comprehensive income. Impairment losses recognised in the consolidated statement
of comprehensive income on equity instruments are not reversed through the consolidated statement of comprehensive income.
Cash and cash equivalents
For the purpose of the consolidated statement of cash flows, cash and cash equivalents comprise cash on hand, deposits
held at call with banks and bank overdrafts. In the consolidated statement of financial position, bank overdrafts are included
in borrowings in current liabilities.
Borrowings
Borrowings are recorded initially at the proceeds received, net of transaction costs incurred. Borrowings are subsequently
stated at cost. Any differences between the proceeds (net of transaction costs) and the redemption value is recognised in the
consolidated statement of comprehensive income over the period of the borrowings.
Trade payables
Trade payables are initially measured at fair value, and are subsequently measured at cost.
Derecognition of financial assets and liabilities 
Financial assets
A financial asset (or, where applicable a part of a financial asset or part of a group of similar financial assets) is derecognised when:
• the rights to receive cash flows from the asset have expired;
• the Group retains the right to receive cash flows from the asset, but has assumed an obligation to pay them in full
without material delay to a third party under a ‘pass through’ arrangement; or
• the Group has transferred its rights to receive cash flows from the asset and either (a) has transferred substantially all
the risks and rewards of the asset, or (b) has neither transferred nor retained substantially all the risks and rewards of
the asset, but has transferred control of the asset.
Financial liabilities
A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires.
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010
NORCON PLC
21 NORCON PLC
22
2. Accounting policies (continued)
When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of
an existing liability are substantially modified, such an exchange or modification is treated as a derecognition of the original
liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in profit or loss.
Impairment of assets 
Assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment. Assets that are
subject to depreciation or 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. The recoverable amount is the higher of an asset's fair value less costs to
sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are
separately identifiable cash flows (cash generating units).
Offsetting financial instruments 
Financial assets and financial liabilities are offset and the net amount reported in the consolidated statement of financial position
if, and only if, there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on
a net basis, or to realise the asset and settle the liability simultaneously. This is not generally the case with master netting
agreements, and the related assets and liabilities are presented gross in the consolidated statement of financial position.
Impairment of tangible and intangible assets 
At each reporting date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether
there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount
of the assets is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate
the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash generating unit to
which the asset belongs.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future
cash flows are discounted to their present value using a pre tax discount rate that reflects current market assessments of the
time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash generating unit) is reduced to its recoverable amount. An impairment loss is
recognised immediately in income statement, unless the relevant asset is carried at a revalued amount, in which case the
impairment loss is treated as a revaluation decrease.
Share capital 
Ordinary shares are classified as equity. The difference between the fair value of the consideration received by the Company
and the nominal value of the share capital being issued is taken to the share premium account.
Provisions 
Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is
probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount can be
made. Where the Group expects a provision to be reimbursed, for example under an insurance contract, the reimbursement
is recognised as a separate asset but only when the reimbursement is virtually certain.
Non-current liabilities 
Non current liabilities represent amounts that are due more than twelve months from the reporting date.
Contingent Liabilities
Contingent liabilities are disclosed if the confirmation of the expense or loss is considered possible from future events.
Events after the reporting period
Current assets and liabilities of the company are adjusted to reflect any events after the reporting period and include additional
information for amounts calculated on the basis ruling at the statement of financial position date.
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010 3. Financial risk management
Financial risk factors
The Group is exposed to market price risk, interest rate risk, credit risk, liquidity risk, currency risk, capital risk management
and business risk arising from the financial instruments it holds. The risk management policies employed by the Group to
manage these risks are discussed below:
3.1 Market price risk 
Market price risk is the risk that the value of financial instruments will fluctuate as a result of changes in market prices.
The Group’s available for sale financial assets and financial assets at fair value through profit or loss are susceptible to
market price risk arising from uncertainties about future prices of the investments. The Group’s market price risk is
managed through by investing in fully controlled subsidiaries as well as in associates in which it exercises significant
influence and by continuously monitoring the factors that affect the value.
3.2 Interest rate risk 
Interest rate risk is the risk that the value of financial instruments will fluctuate due to changes in market interest rates.
Borrowings issued at variable rates expose the Group to cash flow interest rate risk. Borrowings issued at fixed rates
expose the Group to fair value interest rate risk. The Group’s Management monitors the interest rate fluctuations on a
continuous basis and acts accordingly.
3.3 Credit risk 
Credit risk arises when a failure by counter parties to discharge their obligations could reduce the amount of future cash
inflows from financial assets on hand at the statement of financial position date. The Group has policies in place to
ensure that sales of services are made to customers with an appropriate credit history and monitors on a continuous
basis the ageing profile of its receivables.
The company monitors receivables on an ongoing basis and continuously follows up outstanding balances for collection.
The credit risk on liquid funds is limited, as the counter parties are well known banks, with high credit rating by international
credit rating agencies.
The maximum exposure to credit risk for the company is represented by the carrying amount of each financial asset as
disclosed in the financial statements.
In line with the high concentration of revenue from two clients, (note 6) accounts receivable are similarly concentrated
(note 17). While based on past experience this has worked out without any problems for the Group, such concentration does
imply potentially greater credit risk.
3.4 Liquidity risk 
Liquidity risk is the risk that arises when the maturity of assets and liabilities does not match. An unmatched position
potentially enhances profitability, but can also increase the risk of losses. The Group has procedures with the object of
minimising such losses such as maintaining sufficient cash.
3.5 Currency risk 
Currency risk is the risk that the value of financial instruments will fluctuate due to changes in foreign exchange rates.
Currency risk arises when future commercial transactions and recognised assets and liabilities are denominated in a
currency that is not the Group's measurement currency. The Group is exposed to foreign exchange risk arising from
various currency exposures primarily with respect to the US Dollar against the Euro and local currencies listed in note
28. The Groups Management monitors the exchange rate fluctuations on a continuous basis and acts accordingly.
3.6 Capital risk management 
The Group manages its capital to ensure that it will be able to continue as a going concern while maximising the return
to shareholders through the optimisation of the debt and equity balance. The Group’s overall strategy remains
unchanged from last year.
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010
NORCON PLC
23 NORCON PLC
24
3. Financial risk management (continued)
3.7 Business risks
The Group has renewed its major clients at virtually a 100% rate in prior years, with major client relationships lasting in
excess of ten years. While the Group aims to work (and frequently does so) through Master Purchase Agreements or
Frame Agreements that cover a multi year period, it does renew contracts on an annual basis. While this practice has
worked very well for the Group during its period of operations, contract renewing on an annual basis as well as high a
concentrated client basis (notes 6 and 17) do convey a certain extent of business risk should in future contracts are not
renewed and/or receivables are not collected.
Fair value estimation
The fair values of the Group’s financial assets and liabilities approximate their carrying amounts at the reporting date.
4. Critical 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 assumptions concerning the future. The resulting accounting estimates will, by definition,
seldom equal the related actual results. The estimates and assumptions 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:
• Income taxes 
Significant judgment is required in determining the provision for income taxes. There are 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 of 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 provisions in the period in which such determination is made.
5. Segmental analysis 
The consolidated entity operates in one business segment (telecommunications, IT and defence systems consulting) for
primary reporting and three geographical segments for secondary reporting being as follows: Europe, Middle East and Asia.
2010 Europe Middle East Asia Total
US$ US$ US$ US$
Results
Income for the year (2.784.282) 6.901.505 175.062 4.292.285
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Assets and Liabilities
Segment assets 4.220.726 39.724.357 456.402 44.401.485
Segment liabilities (383.215) (20.328.805) (846.448) (21.558.468)
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Other segment information
Acquisition/(disposal) of fixed assets (1.066) 133.597 – 132.531
Depreciation 5.287 46.052 1.968 53.307
Net cash flow 1.961.705 3.128.260 (41.241) 5.048.724
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010 5. Segmental analysis (continued)
2009 Europe Middle East Asia Total
US$ US$ US$ US$
Results
Income for the year (1.229.458) 8.432.619 520.914 7.724.075
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Assets and Liabilities
Segment assets 3.652.699 41.551.547 667.947 45.872.193
Segment liabilities 676.005 27.109.401 1.109.998 28.895.404
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Other segment information
Acquisition of fixed assets – 13.719 – 13.719
Depreciation 7.907 40.877 1.968 50.752
Net cash flow (387.988) (985.102) 70.214 (1.302.876)
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
6. Revenue
2010 2009
US$ US$
Consultancy services – 1.192.019
Value of work executed 68.597.874 76.982.049
–––––––––––– ––––––––––––
68.597.874 78.174.068
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
The Group’s revenues are highly concentrated with the majority of it earned from its primary client (approximately 80%) with
a further 9% (approximately) coming from its second largest client.
7. Profit from investing activities
2010 2009
US$ US$
Profit from sale of investments in subsidiaries – 7.861
Interest income 16.574 64.346
–––––––––––– ––––––––––––
16.574 72.207
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
8. Other expenses 
2010 2009
US$ US$
Loss on disposal of property, plant and equipment 269 483
–––––––––––– ––––––––––––
269 483
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
9. Operating profit 
2010 2009
US$ US$
Operating profit is stated after charging the following items:
Depreciation of property, plant and equipment (Note 15) 53.307 50.752
Staff costs including Directors in their executive capacity (Note 10) 3.016.110 2.740.163
Auditors’ remuneration 164.271 205.404
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010
NORCON PLC
25 NORCON PLC
26
10. Staff costs
2010 2009
US$ US$
Wages and salaries 2.782.770 2.173.479
Expenses related to equity settled share-based payments 233.340 566.684
–––––––––––– ––––––––––––
3.016.110 2.740.163
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
11. Finance costs 
2010 2009
US$ US$
Net foreign exchange transaction losses 56.443 342.702
Interest expense 322.657 301.892
Other finance expenses 193.376 198.515
–––––––––––– ––––––––––––
572.476 843.109
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
12. Tax
2010 2009
US$ US$
Overseas tax 2.419.326 3.005.266
Defence contribution current year 1.860 6.373
–––––––––––– ––––––––––––
2.421.186 3.011.639
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
The tax on the Group’s profit before tax differs from the theoretical amount that would arise using the applicable tax rates as
follows:
2010 2009
US$ US$
Profit before tax 6.713.471 10.735.714
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Tax calculated at the applicable tax rates 671.347 1.073.571
Tax effect of allowances and income not subject to tax (671.347) (1.073.571)
Defence contribution current year 1.860 6.373
Overseas tax during the year 2.419.326 3.005.266
–––––––––––– ––––––––––––
Tax charge 2.421.186 3.011.639
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
2010 2009
Corporation tax by country of operations: US$ US$
Corporation tax for Qatar – (22)
Corporation tax for Kuwait 371.721 399.657
Corporation tax for Saudi Arabia 1.876.221 1.955.399
Corporation tax for South East Asia 128.865 639.448
Corporation tax for Norway 42.519 10.784
2.419.326 3.005.266
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010 12. Tax (continued)
The corporation tax rate is 10%. The Board of Directors has decided to register the company as a Cyprus tax resident, as it
is deemed that the management and control of the company is exercised in Cyprus. In this respect tax computation under
Cyprus tax law has been proposed.
Under certain conditions interest income may be subject to defence contribution at the rate of 10%. In such cases this interest
will be exempt from corporation tax. In certain cases, dividends received from abroad may be subject to defence contribution
at the rate of 15%.
Income tax on the Saudi Arabia branch has been provided on the estimated taxable profit at 20% (2009: 20%).
Income tax on the Kuwait branch has been provided on the estimated taxable profit at 15% (2009: 15%).
Income tax on the SE Asia Operations branch has been provided on the estimated taxable profit at 28% plus 20% on the
profit after tax repatriation of profits (2009: 28% plus 20% on the profit after tax repatriation of profits).
The subsidiary company in Norway is subject to 28% tax of its income.
The subsidiary company in Oman is subject to income tax at the rate of 12% on taxable income in excess of RO30.000. No
provision has been made for the current year as the company incurred a loss for the year.
13. Profit per share attributable to equity holders of the parent
Basic earnings per share 2010 2009
Profit attributable to shareholders (US$) 4.294.586 7.727.754
–––––––––––– ––––––––––––
Weighted average number of ordinary shares in issue during the year 47.174.875 41.312.771
–––––––––––– ––––––––––––
Basic earnings per share (cent) 9,10 18,71
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
The tax on the Group’s profit before tax differs from the theoretical amount that would arise using the applicable tax rates
as follows:
02/06/2008 –
2009 31/12/2008
US$ US$
Profit before tax 10.735.714 5.227.880
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Tax calculated at the applicable tax rates 1.073.571 522.788
Tax effect of allowances and income not subject to tax (1.073.571) (304.582)
Defence contribution current year 6.373 4.420
Overseas tax in excess of credit claim used during the year 3.005.266 1.546.158
–––––––––––– ––––––––––––
Tax charge 3.011.639 1.768.784
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010
NORCON PLC
27 NORCON PLC
28
13. Profit per share attributable to equity holders of the parent (continued)
Diluted earnings per share 2010 2009
Profit attributable to shareholders (US$) 4.294.586 7.727.754
–––––––––––– ––––––––––––
Ordinary shares issued 48.800.808 41.881.521
Shares deemed to be issued:
Employee options – 1.516.666
Warrants (note) 411.232 411.232
49.212.040 43.809.419
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Diluted earnings per share (cent) 8,72 17,63
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
14. Dividends
2010 2009
US$ US$
Dividend paid 4.860.000 3.220.000
–––––––––––– ––––––––––––
4.860.000 3.220.000
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
In July 2010, The Board of Directors paid dividend of 3.860.000 out of the 2009 profits (2008: US$3.220.000), and on
3 December 2010, paid an interim dividend of US$1.000.000 out of the first half 2010 profits. The Board of Directors remains’
committed to maintaining the policy established upon the IPO in 2008 of paying at least 50% dividend on the year’s net profit
after tax. A final decision on total dividend to be paid out of the 2010 profits will be made during The Board of Directors
meeting to be held in May 2011.
Dividends are subject to a deduction of special contribution for defence at the rate of 15% for individual shareholders that are
resident in Cyprus.
15. Property, plant and equipment 
Furniture, Computer 
fixtures hardware 
Motor and office and 
vehicles equipment software Total
US$ US$ US$ US$
Cost
Balance at 1 January 2009 9.520 459.049 265.952 734.521
Additions – 9.104 4.615 13.719
Disposals – – (1.556) (1.556)
Exchange differences – – (5.017) (5.017)
Written off – (20.356) (11.874) (32.230)
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Balance at 31 December 2009/1 January 2010 9.520 455.414 265.952 734.521
Additions 118.360 14.260 4.987 137.607
Exchange differences – (1.076) 1.460 384
Written off – (492) (4.968) (5.460)
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Balance at 31 December 2010 127.880 460.489 253.599 841.968
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010 15. Property, plant and equipment (continued)
Depreciation
Balance at 1 January 2009 2.065 411.658 184.746 598.469
Charge 1.90327.70621.14350.752
On disposals – – (284) (284)
Exchange differences – – (540) (540)
Written off – (20.356) (11.874) (32.230)
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Balance at 31 December 2009/1 January 2010 3.968 419.008 193.191 616.167
Charge 25.5757.50020.23253.307
Exchange differences – (1.080) 431 (649)
Written off – (492) (4.699) (5.191)
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Balance at 31 December 2010 29.543 424.936 209.155 663.634
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Net book amount
Balance at 31 December 2010 98.337 35.553 44.444 178.334
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Balance at 31 December 2009 5.552 28.789 58.929 93.270
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
16. Investments in associated undertakings 
2010 2009
US$ US$
Balance at 1 January 592.925 593.620
Share of results of associates before tax (1.365) (695
–––––––––––– ––––––––––––
Balance at 31 December 591.560 592.925
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
The details of the investments are as follows:
Country of Principal 2010 2009
Name incorporation activities Holding Holding 2010 2009
% % US$ US$
Norconsult Telematics 
(Saudi) Ltd Saudi Arabia Dormant 50 50 591.560 592.925
–––––––––––– ––––––––––––
591.560 592.925
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Significant aggregate amounts in respect of associated undertakings:
2010 2009
US$ US$
Assets
Current assets 1.338.354 1.338.354
–––––––––––– ––––––––––––
1.338.354 1.338.354
–––––––––––– ––––––––––––
Liabilities
Current liabilities 155.234 152.504
–––––––––––– ––––––––––––
155.234 152.504
–––––––––––– ––––––––––––
Net assets 1.183.120 1.185.850
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Expenses (2.729) (1.390)
–––––––––––– ––––––––––––
Net loss after tax (2.729) (1.390)
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010
NORCON PLC
29 NORCON PLC
30
17. Trade and other receivables 
2010 2009
US$ US$
Trade receivables 20.188.922 19.490.420
Retentions receivable 3.903.438 8.499.929
Unbilled receivables 4.425.238 6.236.642
Directors’ current accounts – debit balances (Note 26) 70.889 –
Deposits and prepayments 788.097 646.041
Other receivables 2.179.819 3.120.445
–––––––––––– ––––––––––––
31.556.403 37.993.477
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
As at 31 December, the ageing of trade receivables is as follows:
2010 2009
US$ US$
Up to 30 days 9.277.692 9.562.766
31 60 days 5.268.148 7.296.325
61 90 days 4.612.564 932.89
91 120 days 631.473 1.381.495
More than 120 days 399.045 316.938
–––––––––––– ––––––––––––
20.188.922 19.490.420
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
The fair values of trade and other receivables due within one year approximate to their carrying amounts as presented above.
Included in trade receivables are amounts totaling US$16,88m (2009: US$13,92m) due from Government and quasi
Government institutions of the Kingdom of Saudi Arabia out of which approximately US$Nil (2009: US$40.576) is more than
one year old.
Certain trade receivable invoices are assigned to a local bank in Saudi Arabia against a short term loan.
Based on past experience the Group had not faced any problems in recovering its receivables. It should be mentioned that
approximately 80% of the receivables relate to the Group’s primary client, while approximately another 10% emanates from
its second largest client.
18. Cash at bank and in hand
For the purposes of the consolidated statement of cash flows, the cash and cash equivalents include the following:
2010 2009
US$ US$
Cash at bank and in hand 12.075.188 7.192.521
Bank overdrafts (Note 21) (82.237) (248.294)
–––––––––––– ––––––––––––
11.992.951 6.944.227
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
The exposure of the Group to credit risk and impairment losses in relation to cash and cash equivalents is reported in note 3
of the financial statements.
Short term deposits amounting to US$5.230.646 (2009: US$2.576.292) represent deposits kept with the bank against
guarantees issued by the bank in favour of Department of Zakat and Income tax to issue No Objection Letters for release of
retention money from the customers relating to the company's Saudi Arabia branch.
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010 19. Share capital 
2010 2009
Number of 2010 Number 2009
shares GBP of shares GBP
Authorised
Ordinary shares of Stg£0,01 each 100.000.000 1.000.000 100.000.000 1.000.000
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
US$ US$
Issued and fully paid
Balance at 1 January 41.881.521 833.117 41.123.188 820.655
Issue shares of Stg£0,01 each under employee share
based payment benefit 758.333 11.699 758.333 12.462
Issue of shares of Stg£0,01 each 6.160.954 92.284 – –
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Balance at 31 December 48.800.808 937.100 41.881.521 833.117
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– ––––––––––––
Authorised capital
Under its Memorandum the Company fixed its share capital at 100.000.000 ordinary shares of nominal value of Stg£0,01 each.
Issued capital
The Company was admitted to trading on 28 July 2008 at AIM Market London Stock Exchange and issued 41.123.188
ordinary shares of nominal value of Stg£0,01 each. In connection with the listing a total of 2.246.376 ordinary shares were
sold to new investors out of which 1.123.188 were issued at a share premium of Stg£0,68 per share and were new shares
while the other 1.123.188 were sold by existing shareholders.
On 9 October 2009, the company made the first issue of LTIP Award plan for 758.333 Ordinary shares Stg£0,01 each, which
was admitted for trading at AIM Market London Stock Exchange. The total number of shares issued following the admission
of these ordinary shares was 41.881.521 (Note 22).
On 29 March 2010, the company issued 3.521.668 new ordinary shares of Stg£0,01 each at a share premium of Stg£0,74
per share (cum dividend). On 9 April 2010 the company issued 2.639.286 ordinary shares of Stg£0,01 each at a share
premium of Stg£0,69 per share (ex dividend).
On 28 July 2010, the company made the second issue of LTIP Award plan for 758.333 ordinary shares Stg£0,01 each. The
total number of shares issued thereafter is 48.800.808 ordinary shares (Note 22).
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010
NORCON PLC
31 20. Other reserves
Equity 
settled 
employee
Share Merger Statutory benefits Translation 
premium reserve reserve reserve reserve Total
US$ US$ US$ US$ US$ US$
Balance at 1 January 2009 – 7.647.006 (1.588) – (16.090) 7.629.328
Exchange difference arising on the
translation and consolidation of foreign
companies’ financial statements – – (53) – (102.217) (102.270)
–––––––––––– –––––––––––– –––––––––––– –––––––––––– –––––––––––– ––––––––––––
Equity settled employee benefits
reserve (Note 22) – – – 566.684 – 566.684
–––––––––––– –––––––––––– –––––––––––– –––––––––––– –––––––––––– ––––––––––––
Balance at 31 December 2009/
1 January 2010 7.647.006 (1.641) 566.684 (118.307) 8.093.742
Exchange difference arising on the
translation and consolidation of
foreign companies’
financial statements – – – (14.575) (14.575)
Issue of share capital 6.257.283 –––– 6.257.283
Equity settled employee benefits
reserve (Note 22) – – 233.340 – 233.340
–––––––––––– –––––––––––– –––––––––––– –––––––––––– –––––––––––– ––––––––––––
Balance at 31 December 2010 6.257.283 7.647.006 (1.641) 800.024 (132.882) 14.569.790
–––––––––––– –––––––––––– –––––––––––– –––––––––––– –––––––––––– ––––––––––––
–––––––––––– –––––––––––– –––––––––––– –––––––––––– –––––––––––– ––––––––––––
Exchange differences relating to the translation of the net assets of the Group’s foreign operations from their functional
currencies to the Group’s presentation currency (i.e. Currency Units) are recognised directly in other comprehensive income
and accumulated in the foreign currency translation reserve. Exchange differences previously accumulated in the foreign
currency translation reserve are reclassified to profit or loss on the disposal or partial disposal of the foreign operation.
21. Borrowings 
2010 2009
US$ US$
Current borrowings
Bank overdrafts (Note 18) 82.237248.294
Bank loans 5.937.631 6.438.839
–––––––––––– ––––––––––––
6.019.868 6.687.133
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Note
• The short term loan is secured over the assignment of certain trade receivable invoices. It carries interest at commercial
rates and is repayable within next fiscal year.
• The bank overdraft is secured by a guarantee from its subsidiary. It carries interest at commercial rates.
22. Share-based payment
The company has adopted a Long Term Incentive Plan (LTIP) for eligible employees and directors as of 28 July 2008.
The initial plan provides for 2.274.999 shares to be granted to these employees and directors over a five year period. These
shares represent 5,25% of the company's issued share capital. This initial award will count towards the company’s overall
dilution limit for employee shares schemes of 10% in any ten year rolling period.
NORCON PLC
32
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010 22. Share-based payment (continued)
As per the initial LTIP award, one third of the award vested and become exercisable on the first anniversary of the date of the
grant, one third vested and became exercisable on the second anniversary of the date of the grant and the balance would
have been vested and became exercisable on the third anniversary of the date of the grant if the vesting condition of 10%
growth in the consolidated net income year over year has also been met (which it was not related to the 2010 results).
On 9 October 2009, the company made the first issue of LTIP Award plan for 758.333 Ordinary shares Stg£0,01 each,
admitted trading on AIM Market London Stock Exchange. The total number of shares issued following the admission of these
ordinary shares was 41.881.521.
On 28 July 2010, the company made the second issue of LTIP Award plan for 758.333 ordinary shares Stg£0,01 each. The
total number of shares issued thereafter is48.800.808 ordinary shares.
The Company’s Remuneration Committee confirmed that based on the results for 2010 the vesting condition for 2010
financial year has not been met and therefore no additional shares will be issued to key employees for the year 2011, unless
a change of control triggers a vesting of the remaining third tranche of shares in the amount of 758,333. As of 4 April 2011,
the Remuneration Committee also extended the period during which the third tranche of shares could be earned in years four
or five of the plan subject to the financial performance in 2011 or 2012.
23. Employees’ terminal benefits 
Employees’ 
terminal 
benefits
US$
Balance at 1 January 2009 6.163.802
Charged to consolidated statement of comprehensive income 1.136.693
–––––––––––––
Balance at 31 December 2009/1 January 2010 7.300.495
Charged to consolidated statement of comprehensive income 2.486.311
–––––––––––––
Balance at 31 December 2010 9.786.806
––––––––––––
––––––––––––
Provision is made for amounts payable under GCC laws and regulations applicable to employees’ accumulated period of
service at the statement of financial position.
24. Trade and other payables 
2010 2009
US$ US$
Trade payables 1.273.038 9.343.956
Directors’ current accounts – credit balances 449 –
Accruals 2.230.800 3.236.330
Other creditors 461.991 218.197
Payables to related companies (Note 26) – 60.465
–––––––––––– ––––––––––––
3.966.278 12.858.948
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
The fair values of trade and other payables due within one year approximate to their carrying amounts as presented above.
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010
NORCON PLC
33 25. Current tax liabilities
2010 2009
US$ US$
Corporation tax 1.783.666 2.042.523
Special contribution for defence 1.850 6.305
–––––––––––– ––––––––––––
1.785.516 2.048.828
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Corporation tax liabilities by country of operations:
2010 2009
US$ US$
Cyprus (204.957) (221.659)
Saudi Arabia 880.399 904.521
South East Asia 694.308 941.664
Norway 42.195 11.815
Kuwait 371.721 406.182
–––––––––––– ––––––––––––
1.783.666 2.042.523
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
26. Related party transactions 
The Company’s majority shareholders are: 47,19% Norconsult Telematics Holdings Limited, a company incorporated in
Cyprus, 13,53% Mr. Gaute Vik, company director, 9,13% AXA Investment Managers, 5,61% Mr. Arnold Rorholt, company
director, 4,71% Gartmore Investment Management with the remaining 19,83% ownership belonging to a number of
shareholders comprising less than 3,0% each.
The following transactions were carried out with related parties:
26.1 Compensation of key management personnel 
The remuneration of Directors and other members of key management was as follows:
2010 2009
US$ US$
Salaries and benefits 2.339.749 2.093.912
Service awards and bonuses 233.340 566.684
–––––––––––– ––––––––––––
2.573.089 2.660.596
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
26.2 Payables to related parties (Note 24)
2010 2009
Name US$ US$
Teleplan AS – 60.465
–––––––––––– ––––––––––––
– 60.465
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
TeleplanAS is company which is controlled by one of the ultimate shareholders of Norconsult Telematics Holdings Limited.
The above amount was unsecured, interest free and had no fixed date of repayment.
NORCON PLC
34
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010 26. Related party transactions (continued)
26.3 Director’s current account debit balance (Note 17) 
2010 2009
Name US$ US$
Arnold Rorholt 70.889 –
–––––––––––– ––––––––––––
70.889 –
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
The director’s current account is bearing interest at 1,311% per annum, and has no specified repayment date. This loan was
subsequently repaid post-period end (note 31).
27. Shareholders holding more than 5% of share capital 
The shareholders holding more than 5% of the share capital of the Company as at 31 December 2010 were:
31 December 31 December 
2010 2009
%%
Norconsult Telematics Holdings Ltd 47,19 54,98
GauteVik 13,53 15,25
AXA Investment Managers 9,13 5,70
Arnold Rorholt 5,61 5,77
Gartmore Investment Management 4,71 7,35
28. Exchange rates 
The exchange rates against the US$ used for the translation of the financial statements of branches/entities which are using
a different functional currency were:
End of the year rates 2010 2009 2008
SAR 3,75 3,75 3,75
AED 3,676 3,676 3,676
RO 0,3840 0,3840 0,3836
KD 0,2807 0,2859 0,2679
NOK 5,8962 5,8065 7,0323
Average rates
SAR 3,75 3,75 3,75
AED 3,676 3,676 3,676
RO 0,3840 0,3832 0,3831
KD 0,2833 0,2859 0,2679
NOK 5,8514 6,3611 6,2174
29. Contingent liabilities 
The bankers of the Saudi Arabia branch have given bank guarantees limited to the equivalent of US$6.303.153
(2009: US$5.271.267) in respect of contract performance.
Letters of guarantee (Performance Bonds) for the company’s operations in UAE amounting to US$1.220.400
(2009: US$1.220.400) were in issue as at 31st December 2010. This guarantee is 50% secured with a counter guarantee
from a Cyprus bank. A letter of guarantee for AED50.000 for the registration of the Norconsult Abu Dhabi branch was also in
issue as at 31st December 2010.
A bank guarantee amounting to US$33.854 (RO 13.000) was issued by the Group’s subsidiary in Oman.
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010
NORCON PLC
35 30. Commitments 
Operating lease commitments
The future aggregate minimum lease payments under non-cancellable operating leases are as follows:
2010 2009
US$ US$
Within one year 93.978 95.168
–––––––––––– ––––––––––––
93.978 95.168
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
31. Events after the reporting period 
The Board of Directors remains’ committed to maintaining the policy established upon the IPO in 2008 of paying at least 50%
dividend on the year's net profit after tax. A final decision on total dividend to be paid out of the 2010 profits will be made
during The Board of Directors meeting to be held in May 2011.
The loan to the director (note 26) has been repaid during April, 2011.
NORCON PLC
36
Notes to the Consolidated Financial Statements continued
Year ended 31 December 2010 2010 2009
Page US$ US$
Revenue 
Consultancy services – 1.192.019
Income from value of work executed 35 12.152.183 14.450.669
–––––––––––– ––––––––––––
Gross profit 12.152.183 15.642.688
Operating expenses 
Administration expenses (4.881.176) (4.134.894)
–––––––––––– ––––––––––––
7.271.007 11.507.794
Other operating expenses
Loss on disposal of property, plant and equipment (269) (483)
Profit from sale of investments in subsidiaries – 7.861
Interest income 36 16.574 64.346
–––––––––––– ––––––––––––
Operating profit 7.287.312 11.579.518
Finance costs 36 (572.476) (843.109)
Share of results of associates before tax (1.365) (695)
–––––––––––– ––––––––––––
Net profit for the year before tax 6.713.471 10.735.714
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Detailed Income Statement
Year ended 31 December 2010
NORCON PLC
37 2010 2009
US$ US$
Income
Income from value of work executed 68.597.874 76.982.049
–––––––––––– ––––––––––––
Cost of sales
Consulting fees 225.172 –
Cost of work executed 56.220.519 62.531.380
–––––––––––– ––––––––––––
56.445.691 62.531.380
–––––––––––– ––––––––––––
Gross profit from work executed 12.152.183 14.450.669
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
NORCON PLC
38
Value of Work Executed
Year ended 31 December 2010 2010 2009
US$ US$
Finance income
Bank interest 15.895 64.346
Other interest income 679 –
–––––––––––– ––––––––––––
16.574 64.346
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Finance costs
Interest expense
Bank overdraft interest 321.836 294.883
Interest on taxes 821 7.009
Other finance expenses
Bank charges 193.376 198.515
Net foreign exchange transaction losses
Realised exchange loss 56.443 342.702
–––––––––––– ––––––––––––
572.476 843.109
–––––––––––– ––––––––––––
–––––––––––– ––––––––––––
Finance Income/Cost
Year ended 31 December 2010
NORCON PLC
39 NORCON PLC
40
NOTICE IS HEREBY GIVEN that the Annual General Meeting of the Company will be held on 27 June 2011 at the registered
office of the Company, Fort Anne, Douglas, Isle of Man, IM1 5PD at precisely 12 noon for the following purposes:
Ordinary Business
To consider, and if thought fit, to pass the following resolutions which will be proposed as ordinary resolutions:
1. to receive and adopt the Company’s annual accounts for the financial year ended 31 December 2010 together with the
directors’ report and auditors’ report on those accounts;
2. to declare a final dividend of US$0.02356133 per ordinary share of £0.01 par value each in the capital of the Company
in respect of the financial year ended 31 December 2010, to be paid to all holders of ordinary shares appearing in the
register of members of the Company at 24 June 2011 (“the Record Date”) within six months of such Record Date;
3. to re-elect, as a director of the Company, Mr. Gaute Vik who retires by rotation and, being eligible, offers himself for
re-election in accordance with the Articles of Association (the “Articles”) of the Company;
4. to re-elect, as a director of the Company, Mr. Kenneth West who retires by rotation and, being eligible, offers herself for
re-election in accordance with the Articles of the Company; and
5. to reappoint PKF Savvides & Co Ltd. as auditors to hold office from the conclusion of the meeting to the conclusion of
the next general meeting of the Company at which the accounts are laid before the shareholders at a remuneration to
be determined by the directors of the Company.
Special Business
To consider and, if thought fit, to pass the following resolution which will be proposed as a special resolution:
6. that the Directors of the Company be authorised to allot ordinary shares of £0.01 each in the capital of the Company
(“Ordinary Shares”) for cash as if the provisions of Article 5.2 of the Articles did not apply, provided that this power shall
be limited to the allotment of:
(i) Ordinary Shares up to an aggregate par value equal to 10 per cent. of the aggregate par value of all the Ordinary
Shares in issue at the date of this notice, at such prices, to such persons, on such terms and at such times as
the Directors of the Company may from time to time determine in their discretion; and
(ii) Ordinary Shares pursuant to any share option schemes of the Company in force from time to time; and
such authority shall expire on the earlier of the next annual general meeting of the Company and 15 months after
the date on which this resolution is passed, save that the Company may before such expiry make an offer or
agreement which would or might require Ordinary Shares to be allotted after such expiry and the Directors may
allot Ordinary Shares pursuant to such offer or agreement as if such authority had not expired.
BY ORDER OF THE BOARD
Director
Date 31 May 2011
Fort Anne
Douglas
Isle of Man
IM1 5PD
Notice of Annual General Meeting
To the Members of Norcon plc (“the Company”) 
Notice of Annual General Meeting
To the Members of Norcon plc (“the Company”)   Notes:
1. A member of the Company entitled to attend and vote at the above-mentioned meeting is entitled to appoint another person as his
proxy to attend, to speak and to vote in his stead. A proxy need not be a member of the Company.
2. To be effective, forms of proxy must be lodged at the Company's registered office, Fort Anne, Douglas, Isle of Man, IM1 5PD, not later
than 12 noon on 24 June 2011. Lodgement of a form of proxy will not prevent a member from attending and voting in person.
3. The Company, pursuant to Regulation 22 of the Uncertificated Securities Regulations 2006 (Isle of Man), specifies that only those
members registered in the register of members as at 12 noon. on 24 June 2011 (or in the event that the meeting is adjourned, on the
register of members 48 hours before the time of any adjournment meeting) shall be entitled to attend or vote at the meeting in respect
of the ordinary shares registered in their name at that time. Changes to entries on the register of members after 12 noon on
24 June 2011 (or, in the event that the meeting is adjourned, on the register of members less than 48 hours before the time of any
adjourned meeting) shall be disregarded in determining the rights of any person to attend or vote at the meeting.
4. CREST members who wish to appoint a Proxy or Proxies through the CREST electronic Proxy appointment service may do so for the
AGM and any adjournment thereof by using the procedures described in the CREST manual. CREST personal members or other
CREST sponsored members, and those CREST members who have appointed a 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 CREST Co’s specifications and must contain the information required for such instructions,
as described in the CREST manual. All messages relating to the appointment of a Proxy or an instruction to a previously appointed
Proxy must be transmitted so as to be received by the Registrars no later than 12 noon on 24 June 2011. Normal system timings and
limitations will apply in relation to the input of CREST Proxy instructions. It is therefore the responsibility of the CREST member
concerned to take 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 sponsor(s) or voting service provider(s) 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 18(4)(a) of the Uncertificated
Securities Regulations 2006 (Isle of Man).
NORCON PLC
41
Notice of Annual General Meeting
To the Members of Norcon plc (“the Company”)   NORCON PLC
42 FORM OF PROXY
I/We ................................................................................................................................................................................................................
of ....................................................................................................................................................................................................................
........................................................................................................................................................................................................................
being a shareholder of the Company hereby appoint the Chairman of the meeting or (see note 3)
........................................................................................................................................................................................................................
as my/our proxy to attend, to speak and to vote for me/us on my/our behalf at the Annual General Meeting of the Company to be held at
12 noon on 27 June 2011 and at any adjournment thereof.
Please indicate with an “X” in the space below how you wish your votes to be cast in respect of the resolutions which are set out in the notice
convening the Annual General Meeting (the “Notice”). If no specific direction as to voting is given, the proxy will vote or abstain from voting at
his/her discretion.
Date: ............................................................................................ Signature: .....................................................................................
Please tick here if you are appointing more than one proxy.     Number of shares proxy appointed over.    Ordinary Resolutions For Against Withheld
1. To receive and adopt the Company’s annual accounts for the financial year ended
31 December 2010 together with the directors’ report and auditors’ report on those
accounts.
2. to approve the final dividend of US$0.02356133 is to be distributed to the shareholders as
of 24 June 2011, payable within six months of such record date.
3. to re-elect Mr. Gaute Vik as a director of the Company in accordance with the Articles of
Association of the Company.
4. to re-elect Mr. Kenneth West as a director of the Company in accordance with the Articles of
Association of the Company.
5. To reappoint PKF Savvides & Co. Ltd. as auditors to hold office from the conclusion of the
meeting to the conclusion of the next general meeting of the Company at which the accounts
are laid before the Shareholder, at a remuneration to be determined by the directors of the
Company.
Special Resolution
6. to approve the disapplication of Article 5.2 of the Company’s Articles of Association.
    NORCON P LC
(the “Company”) 
NORCON PLC
43
Notes:
1. As a member of the Company you are entitled to appoint a proxy to exercise all or any of your rights to attend, speak and vote at a general meeting of the Company. You can only
appoint a proxy using the procedures set out in these notes.
2. Appointment of a proxy does not preclude you from attending the meeting and voting in person. If you have appointed a proxy and attend the meeting in person, your proxy appointment
will automatically be terminated.
3. A proxy does not need to be a member of the Company but must attend the meeting to represent you. To appoint as your proxy a person other than the Chairman of the meeting,
insert their full name in the box. If you sign and return this proxy form with no name inserted in the box, the Chairman of the meeting will be deemed to be your proxy. Where you appoint
as your proxy someone other than the Chairman of the meeting, you are responsible for ensuring that they attend the meeting and are aware of your voting intentions.
4. You may appoint more than one proxy provided each proxy is appointed to exercise rights attached to different shares. You may not appoint more than one proxy to exercise rights
attached to any one share. Should you wish to appoint more than one proxy, please photocopy this form. Please indicate in the box underneath the signature block the number of
shares in relation to which they are authorised to act as your proxy. Please also indicate by ticking the box provided if the proxy instruction is one of multiple instructions being given.
All forms must be signed and should be returned together in the same envelope.
5. To direct your proxy how to vote on the resolutions mark the appropriate box with an “X”. To abstain from voting on a resolution, select the relevant “Withheld” box. A vote withheld is
not a vote in law, which means that the vote will not be counted in the calculation of votes for or against the resolution. If no voting indication is given, your proxy will vote or abstain
from voting at his or her discretion. Your proxy will vote (or abstain from voting) as he or she thinks fit in relation to any other matter which is put before the meeting.
6. To appoint a proxy using this form, the form must be:
● completed and signed;
● sent or delivered to the Company’s registered office to the attention of Cains Fiduciaries Limited, at Fort Anne, Douglas, Isle of Man, IM1 5PD;
● received by Cains Fiduciaries Limited no later than 12 noon 24 June 2011.
7. In the case of a member which is a company, this proxy form must be executed under its common seal or signed on its behalf by an officer of the company or an attorney for the
company.
8. Any power of attorney or any other authority under which this proxy form is signed (or a duly certified copy of such power or authority) must be included with the proxy form.
9. In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, only the appointment submitted by the most senior holder will be accepted. Seniority
is determined by the order in which the names of the joint holders appear in the Company’s register of members in respect of the joint holding (the first-named being the most senior).
10. If you submit more than one proxy appointment, the appointment received last before the latest time for the receipt of proxies will take precedence.
✃ Perivan Financial Print  221688 221668 Norcon  R&A_Cover  02/06/2011  14:32  Page ii NORCON PLC
Norcon plc
Annual Report 2010
Registered Address: 
Fort Anne, Douglas, 
Isle of Man, IM1 5PD
Correspondence Address: 
5 Andrea Kalvou St., 
PO Box 54843, 
Limassol, Cyprus,CY 3728
www.norconplc.com
Tel: +357 25 736 830     
Fax: +357 25 736 831
Email: info@norconplc.com
 
 
 
Norcon plc 
2010 ANNUAL REPORT 
May 31, 2011 
 
 
 
 
 
 
 
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