##### Table of Contents



SECURITIES AND EXCHANGE COMMISSION
 Washington D.C. 20549
 FORM 20-F
 o
    
    REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934
 OR
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2007
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 o
    
    SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
  Commission file number: 0-22320
 Trinity Biotech plc
   Ireland
  IDA Business Park, Bray, Co. Wicklow, Ireland
   Title of each class
    
    Name of each exchange on which registeredNone
    
    None
  American Depositary Shares (each representing 4 A Ordinary Shares, par value $0.0109)
 None
  74,756,765 Class A Ordinary Shares and 700,000 Class B Shares
  o þ
  o þ
  þ o
  o þ o
  o þ
  o þ




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##### 



TABLE OF CONTENTS
 PagePART IItem 1
    
    Identity of Directors, Senior Management and Advisors
    
    
    1Item 2
    
    Offer statistics and Expected timetable
    
    
    1Item 3
    
    Selected Consolidated Financial Data
    
    
    1Item 4
    
    Information on the Company
    
    
    7Item 5
    
    Operating and Financial Review and Prospects
    
    
    14Item 6
    
    Directors and Senior Management
    
    
    35Item 7
    
    Major Shareholders and Related Party Transactions
    
    
    38Item 8
    
    Financial Information
    
    
    40Item 9
    
    The Offer and Listing
    
    
    40Item 10
    
    Memorandum and Articles of Association
    
    
    42Item 11
    
    Qualitative and Quantitative Disclosures about Market Risk
    
    
    52Item 12
    
    Description of Securities other than Equity Securities
    
    
    53PART IIItem 13
    
    Defaults, Dividend Arrangements and Delinquencies
    
    
    54Item 14
    
    Material Modification to the Rights of Security Holders and Use of Proceeds
    
    
    54Item 15
    
    Control and Procedures
    
    
    54Item 16A
    
    Audit Committee Financial Expert
    
    
    55Item 16B
    
    Code of Ethics
    
    
    55Item 16C
    
    Principal Accounting Fees and Services
    
    
    55PART IIIItem 17
    
    Consolidated Financial Statements
    
    
    56Item 18
    
    Consolidated Financial Statements
    
    
    56Item 19
    
    Exhibits
    
    
    125Exhibit 12.1Exhibit 12.2Exhibit 13.1Exhibit 13.2Exhibit 15.1




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##### Table of Contents




  
 Item 1 Identity of Directors, Senior Management and Advisers
  
 Item 2 Offer Statistics and Expected Timetable
  
 Item 3 Selected Consolidated Financial Data
   1




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CONSOLIDATED STATEMENT OF OPERATIONS DATA
 Year ended December, 312007
    
    
    2006
    
    
    2005
    
    
    2004Total
    
    
    Total
    
    
    Total
    
    
    TotalUS$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Revenues
    
    
    143,617
    
    
    
    118,674
    
    
    
    98,560
    
    
    
    80,008Cost of sales
    
    
    (75,643
    )
    
    
    (62,090
    )
    
    
    (51,378
    )
    
    
    (40,047
    )Cost of sales  restructuring expenses
    
    
    (953
    )
    
    
    
    
    
    
    
    
    
    
    Cost of sales  inventory write off/ provision
    
    
    (11,772
    )
    
    
    (5,800
    )
    
    
    
    
    
    
    Total cost of sales
    
    
    (88,368
    )
    
    
    (67,890
    )
    
    
    (51,378
    )
    
    
    (40,047
    )Gross profit
    
    
    55,249
    
    
    
    50,784
    
    
    
    47,182
    
    
    
    39,961Other operating income
    
    
    413
    
    
    
    275
    
    
    
    161
    
    
    
    302Research and development expenses
    
    
    (6,802
    )
    
    
    (6,696
    )
    
    
    (6,070
    )
    
    
    (4,744
    )Research and development  restructuring expenses
    
    
    (6,907
    )
    
    
    
    
    
    
    
    
    
    
    Total research and development expenses
    
    
    (13,709
    )
    
    
    (6,696
    )
    
    
    (6,070
    )
    
    
    (4,744
    )Selling, general and administrative expenses
    
    
    (51,010
    )
    
    
    (42,422
    )
    
    
    (34,651
    )
    
    
    (29,332
    )Selling, general and administrative  restructuring
expenses (including goodwill impairment of US$19,156,000)
    
    
    (20,315
    )
    
    
    
    
    
    
    
    
    
    
    Total selling, general and administrative expenses
    
    
    (71,325
    )
    
    
    (42,422
    )
    
    
    (34,651
    )
    
    
    (29,332
    )Operating (loss)/ profit
    
    
    (29,372
    )
    
    
    1,941
    
    
    
    6,622
    
    
    
    6,187Financial income
    
    
    457
    
    
    
    1,164
    
    
    
    389
    
    
    
    302Financial expenses
    
    
    (3,148
    )
    
    
    (2,653
    )
    
    
    (1,058
    )
    
    
    (824
    )Net financing costs
    
    
    (2,691
    )
    
    
    (1,489
    )
    
    
    (669
    )
    
    
    522(Loss)/ profit before tax
    
    
    (32,063
    )
    
    
    452
    
    
    
    5,953
    
    
    
    5,665Income tax (expense)/ credit
    
    
    (3,309
    )
    
    
    2,824
    
    
    
    (673
    )
    
    
    49(Loss)/ profit for the year (all attributable to equity
holders)
    
    
    (35,372
    )
    
    
    3,276
    
    
    
    5,280
    
    
    
    5,714Basic (loss)/ earnings
per A ordinary share
(US Dollars)
    
    
    (0.47
    )
    
    
    0.05
    
    
    
    0.09
    
    
    
    0.10Basic (loss)/ earnings per B ordinary share
(US Dollars)
    
    
    (0.94
    )
    
    
    0.10
    
    
    
    0.18
    
    
    
    0.20Diluted (loss)/ earnings per A ordinary share
(US Dollars)
    
    
    (0.47
    )
    
    
    0.05
    
    
    
    0.09
    
    
    
    0.09Diluted (loss)/ earnings per B ordinary share
(US Dollars)
    
    
    (0.94
    )
    
    
    0.10
    
    
    
    0.18
    
    
    
    0.18Basic (loss)/ earnings per ADS
(US Dollars)
    
    
    (1.86
    )
    
    
    0.19
    
    
    
    0.36
    
    
    
    0.41Diluted (loss)/ earnings per ADS
(US Dollars)
    
    
    (1.86
    )
    
    
    0.19
    
    
    
    0.35
    
    
    
    0.37Weighted average number of A shares used in computing
basic EPS
    
    
    76,036,579
    
    
    
    70,693,753
    
    
    
    58,890,084
    
    
    
    55,132,024Weighted average number of A shares used in computing
diluted EPS
    
    
    76,036,579
    
    
    
    72,125,740
    
    
    
    67,032,382
    
    
    
    65,527,802
  2




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Consolidated Balance Sheet Data
 December
    
    
    December
    
    
    December
    
    
    December31,2007
    
    
    31,2006
    
    
    31, 2005
    
    
    31, 2004US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Net current assets (current assets less current liabilities)
    
    
    36,298
    
    
    
    61,435
    
    
    
    44,964
    
    
    
    53,448Non current liabilities
    
    
    (35,623
    )
    
    
    (45,928
    )
    
    
    (19,083
    )
    
    
    (16,636
    )Total assets
    
    
    215,979
    
    
    
    249,131
    
    
    
    184,602
    
    
    
    156,040Capital stock
    
    
    991
    
    
    
    978
    
    
    
    830
    
    
    
    776Shareholders equity
    
    
    136,845
    
    
    
    167,262
    
    
    
    133,618
    
    
    
    118,894
  Risk Factors
  Trinity Biotechs operating results may be subject to fluctuations.
 
    
    Trinity Biotechs operating results may fluctuate as a result of many factors related to
its business, including the competitive conditions in the industry, major reorganisations of
the Groups activities, loss of significant customers, delays in the development of new
products and currency fluctuations, as described in more detail below, and general factors
such as the size and timing of orders, the prevalence of various diseases and general economic
conditions. In the event of lower operating profits, this could have a negative impact on cash
generated from operations and also negatively impact shareholder value.
 A need for capital might arise in the future if Trinity Biotechs capital requirements increase or
revenues decrease.
 
    
    Up to now Trinity Biotech has funded its operations through the sale of its shares and
securities convertible into shares, cashflows from operations and bank borrowings. Trinity
Biotech expects that the proceeds of equity financings, bank borrowings, lease financing,
current working capital and sales revenues will fund its existing operations and payment
obligations. However, if our capital requirements are greater than expected, or if our
revenues do not generate sufficient cashflows to fund our operations, we may need to find
additional financing which may not be available on attractive terms or at all. Any future
financing could have an adverse effect on our current shareholders or the price of our shares
in general.
 Trinity Biotechs acquisition strategy may be less successful than expected, and therefore, growth
may be limited.
 
    
    Trinity Biotech has historically grown organically and through the acquisition of, and
investment in, other companies, product lines and technologies. There can be no guarantees
that recent or future acquisitions can be successfully assimilated or that projected growth in
revenues or synergies in operating costs can be achieved. Our ability to integrate future
acquisitions may also be adversely affected by inexperience in dealing with new technologies,
and changes in regulatory or competitive environments. Additionally, even during a successful
integration, the investment of managements time and resources in the new enterprise may be
detrimental to the consolidation and growth of our existing business.
 The diagnostics industry is highly competitive, and Trinity Biotechs research and development
could be rendered obsolete by technological advances of competitors.
 
    
    Trinity Biotechs principal business is the supply of medical diagnostic test kits and
related diagnostic instrumentation. The diagnostics industry is extremely competitive.
Trinity Biotech is competing directly with companies which have greater capital resources and
larger marketing and business organisations than Trinity Biotech. Trinity Biotechs ability to
grow revenue and earnings may be adversely impacted by competitive product and pricing
pressures and by its inability to gain or retain market share as a result of the action of
competitors.
  3




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We have invested in research and development (R&D) but there can be no guarantees that our R&D
programmes will not be rendered technologically obsolete or financially non-viable by the
technological advances of our
competitors, which would also adversely affect our existing product lines and inventory. The
main competitors of Trinity Biotech (and their principal products with which Trinity Biotech
competes) include Dade-Behring (Sysmex® CA, D-Dimer plus, Enzygnost®), Zeus Scientific Inc.
(Zeus EIA, IFA), Diasorin Inc. (ETI), Abbott Diagnostics (AxSYM, IMx), Diagnostic Products
Corp.  DPC (Immulite), Bio-Rad (ELISA, WB & A1c), Roche Diagnostics (COBAS AMPLICOR,
Ampliscreen, Accutrend) and OraSure Technologies, Inc (OraQuick ®).
 Trinity Biotech is highly dependent on suitable distributors worldwide.
 
    
    Trinity Biotech currently distributes its product portfolio through distributors in
approximately 80 countries worldwide. Our continuing economic success and financial security
is dependent on our ability to secure effective channels of distribution on favourable trading
terms with suitable distributors.
 Trinity Biotechs business could be adversely affected by changing market conditions resulting in
the reduction of the number of institutional customers.
 
    
    The diagnostics industry is in transition with a number of changes that affect the market
for diagnostic test products. Changes in the healthcare industry delivery system have resulted
in major consolidation among reference laboratories and in the formation of multi-hospital
alliances, reducing the number of institutional customers for diagnostic test products. There
can be no assurance that we will be able to enter into and/or sustain contractual or other
marketing or distribution arrangements on a satisfactory commercial basis with these
institutional customers.
 Trinity Biotechs long-term success depends on its ability to develop new products subject to
stringent regulatory control. Even if new products are successfully developed, Trinity Biotechs
proprietary know-how, manufacturing techniques and trade secrets may be copied by competitors.
Furthermore, Trinity Biotechs patents have a limited life time and are thereafter subject to
competition with generic products. Also, competitors might claim an exclusive patent for products
Trinity Biotech plans to develop.
 
    
    We are committed to significant expenditure on research and development (R&D). However,
there is no certainty that this investment in research and development will yield technically
feasible or commercially viable products. Our organic growth and long-term success is
dependent on our ability to develop and market new products but this work is subject to very
stringent regulatory control and very significant costs in research, development and
marketing. Failure to introduce new products could significantly slow our growth and
adversely affect our market share.
    
    Even when products are successfully developed and marketed, Trinity Biotechs ownership of
the technology behind these products has a finite life. In general, generic competition, which
can arise through replication of the Trinity Biotechs proprietary know-how, manufacturing
techniques and trade secrets or after the expiration of a patent, can have a detrimental
effect on a products revenue, profitability and market share. There can be no guarantee that
the net income and financial position of Trinity Biotech will not be adversely affected by
competition from generic products. Conversely, on occasion, certain companies have claimed
exclusive patent, copyright and other intellectual property rights to technologies in the
diagnostics industry. If these technologies relate to Trinity Biotechs planned products,
Trinity Biotech would be obliged to seek licences to use this technology and, in the event of
being unable to obtain such licences or it being obtainable on grounds that would be
materially disadvantageous to Trinity Biotech, we would be precluded from marketing such
products, which could adversely impact our revenues, sales and financial position.
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Trinity Biotechs patent applications could be rejected or the existing patents could be
challenged; our technologies could be subject to patent infringement claims; and trade secrets and
confidential know-how could be obtained by competitors.
 
    
    We can provide no assurance that the patents Trinity Biotech may apply for will be
obtained or that existing patents will not be challenged. The patents owned by Trinity
Biotech and its subsidiaries may be challenged by third parties through litigation and
could adversely affect the value of our patents. We can provide no assurance that our
patents will continue to be commercially valuable.
    
    Trinity Biotech currently owns 30 US patents with remaining patent lives varying from
less than one year to 16 years. In addition to these US patents, Trinity Biotech owns a
total of 7 additional non-US patents with expiration dates varying between the years 2008
and 2023.
    
    Also, our technologies could be subject to claims of infringement of patents or
proprietary technology owned by others. The cost of enforcing our patent and technology
rights against infringers or defending our patents and technologies against infringement
charges by others may be high and could adversely affect our business.
    
    Trade secrets and confidential know-how are important to our scientific and commercial
success. Although we seek to protect our proprietary information through confidentiality
agreements and other contracts, we can provide no assurance that others will not
independently develop the same or similar information or gain access to our proprietary
information.
 Trinity Biotechs business is heavily regulated and non-compliance with applicable regulations
could reduce revenues and profitability.
 
    
    Our manufacturing and marketing of diagnostic test kits are subject to government
regulation in the United States of America by the Food and Drug Administration (FDA),
and by comparable regulatory authorities in other jurisdictions. The approval process for
our products, while variable across countries, is generally lengthy, time consuming,
detailed and expensive. Our continued success is dependent on our ability to develop and
market new products, some of which are currently awaiting approval from these regulatory
authorities. There is no certainty that such approval will be granted or, even once
granted, will not be revoked during the continuing review and monitoring process.
    
    We are required to comply with extensive post market regulatory requirements.
Non-compliance with applicable regulatory requirements of the FDA or comparable foreign
regulatory bodies can result in enforcement action which may include recalling products,
ceasing product marketing, paying significant fines and penalties, and similar actions
that could limit product sales, delay product shipment, and adversely affect
profitability.
 Trinity Biotechs success is dependent on certain key management personnel.
 
    
    Trinity Biotechs success is dependent on certain key management personnel. Our key
employees at December 31, 2007 were Ronan OCaoimh, our Executive Chairman, Brendan
Farrell, our CEO, Rory Nealon, our COO, Jim Walsh, Director and Kevin Tansley, our CFO and
Secretary. Competition for qualified employees among biotechnology companies is intense,
and the loss of such personnel or the inability to attract and retain the additional highly
skilled employees required for the expansion of our activities, could adversely affect our
business. In the USA, the UK, France, Germany and Sweden we have been able to attract and
retain qualified personnel. In Ireland, we have experienced some difficulties in attracting
and retaining staff due to competition from other employers in our industry and due to the
strength of the Irish economy.
 Trinity Biotech is dependent on its suppliers for the primary raw materials required for its test
kits.
 
    
    The primary raw materials required for Trinity Biotechs test kits consist of antibodies,
antigens or other reagents, glass fibre and packaging materials which are acquired from third
parties. Although Trinity Biotech does not expect to be dependent upon any one source for
these raw materials, alternative sources of antibodies with the characteristics and quality
desired by Trinity Biotech may not be available. Such unavailability could affect the quality
of our products and our ability to meet orders for specific products.
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Trinity Biotech may be subject to liability resulting from its products or services.
 
    
    Trinity Biotech may be subject to claims for personal injuries or other damages
resulting from its products or services. Trinity Biotech has global product liability
insurance in place for its manufacturing subsidiaries up to a
maximum of 6,500,000 (US$9,569,000) for any one accident, limited to a maximum of
6,500,000 (US$9,569,000) in any one year period of insurance. A deductible of US$25,000
is applicable to each insurance event that may arise. There can be no assurance that our
product liability insurance is sufficient to protect us against liability that could have a
material adverse effect on our business.
 Currency fluctuations may adversely affect our earnings and assets.
 
    
    Trinity Biotech records its transactions in US Dollars, euro and Swedish Kroner and
prepares its financial statements in US Dollars. A substantial portion of our expenses is
denominated in euro. However, Trinity Biotechs revenues are primarily denominated in US
Dollars. As a result, the Group is affected by fluctuations in currency exchange rates,
especially the exchange rate between the US dollar and the euro, which may adversely affect
our earnings and assets. The percentage of 2007 consolidated revenue denominated in US Dollars
was approximately 65%. Of the remaining 35% revenue, 27% relates to revenue denominated in
Euro and 8% relates to sterling, yen and Swedish Kroner denominated revenues. Thus, a 10%
decrease in the value of the euro would have approximately a 3% adverse impact on consolidated
revenues.
    
    As part of the process of mitigating foreign exchange risk, the principal exchange risk
identified by Trinity Biotech is with respect to fluctuations in the euro. This is
attributable to the level of euro denominated expenses exceeding the level of euro denominated
revenues thus creating a euro deficit. Trinity Biotech continuously monitors its exposure to
foreign currency movements and based on expectations on future exchange rate exposure
implements a hedging policy which may include covering a portion of this exposure through the
use of forward contracts. In the medium term, our objective is to increase the level of
non-US Dollar denominated revenue, thus creating a natural hedge of the non-US Dollar
expenditure.
 The conversion of our outstanding employee share options and warrants would dilute the ownership
interest of existing shareholders.
 
    
    The warrants issued in 2004 and the total share options exercisable at December 2007, as
described in Item 18, note 20 to the consolidated financial statements, are convertible into
American Depository Shares (ADSs), 1 ADS representing 4 Class A Ordinary Shares. The
exercise of the share options exercisable and of the warrants will likely occur only when the
conversion price is below the trading price of our ADSs and will dilute the ownership
interests of existing shareholders. For instance, should the options and warrant holders of
the 6,417,223 A Ordinary shares (1,604,306 ADSs) exercisable at December 31, 2007 be
exercised, Trinity Biotech would have to issue 6,417,223 additional A ordinary shares
(1,604,306 ADSs). On the basis of 74,756,765 A ordinary shares outstanding at December 31,
2007, this would effectively dilute the ownership interest of the existing shareholders by
approximately 8%.
 It could be difficult for US holders of ADSs to enforce any securities laws claims against Trinity
Biotech, its officers or directors in Irish Courts.
 
    
    At present, no treaty exists between the United States and Ireland for the reciprocal
enforcement of foreign judgements. The laws of Ireland do however, as a general rule,
provide that the judgements of the courts of the United States have in Ireland the same
validity as if rendered by Irish Courts. Certain important requirements must be satisfied
before the Irish Courts will recognise the United States judgement. The originating court
must have been a court of competent jurisdiction, the judgement may not be recognised if it
is based on public policy, was obtained by fraud or its recognition would be contrary to
Irish public policy. Any judgement obtained in contravention of the rules of natural
justice will not be enforced in Ireland.
  6




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Item 4 Information on the Company
 History and Development of the Company
     Acquisition of the immuno-technology business of Cortex Biochem Inc
  Acquisition of certain components of the distribution business of Sterilab Services UK
  Acquisition of Haemostasis business of bioMerieux Inc
  Acquisition of the distribution business of Laboratoires Nephrotek SARL
  Acquisition of Primus Corporation
  Acquisition of Research Diagnostics Inc
   7




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Principal Markets
   Principal Products
  Infectious
    
    ClinicalHaemostasis
    
    Diseases
    
    Chemistry
    
    Point of CareBiopool®
    
    Bartels®
    
    Primus
    
    UniGoldAmax
    
    CAPTIA
    
    EZ
    
    CapillusDestiny
    
    MarDx®
    
    
    
    Recombigen®MicroTrakMarBlot®
  Haemostasis
 ®
     Infectious Diseases
   8




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1.
    
    The increased Trinity Biotech instrumentation offering/portfolio through collaboration
with Adaltis and Dynex and implementation of a system sell (i.e. combining instruments and
reagents) strategy;2.
    
    Focus on key accounts in affiliate markets;3.
    
    Expansion of product portfolio to meet market demands.
  Clinical Chemistry
   Point of Care (POC)
    Sales and Marketing
  Manufacturing and Raw Materials
   9




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Competition
  Patents and Licences
 Patents
   Licences
      Government Regulation
    10




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FDA Regulation
  Access to US Market.
 5 10(k) Clearance Pathway
 PMA Approval Pathway
  BLA approval pathway.
 Clinical Studies
 Postmarket Regulation
    11




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CLIA classification
    Regulation outside the United States
  Organisational Structure
    12




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Property, Plant and Equipment
  
    
     
  Capital expenditures and divestitures
   13




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Item 5 Operating and Financial Review and Prospects
 Operating Results
   Overview
  Factors affecting our results
     Critical Accounting Policies and Estimates
     14




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Research and development expenditure
     Impairment of intangible assets and goodwill
  
    
    Significant underperformance relative to expected historical or projected future operating results;
    
    Significant changes in the manner of our use of the acquired assets or the strategy for our
overall business;
    
    Obsolescence of products;
    
    Significant decline in our stock price for a sustained period; and our market capitalisation
relative to net book value.
  15




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
    
    An increase in goodwill impairment of US$23.5 million in the event of a 10% decrease in
the growth in revenues.
    
    A decrease in goodwill impairment of US$18.6 million in the event of a 10% increase in
the growth in revenues.
  
    
    An increase in goodwill impairment of US$18.0 million in the event of a 10% increase in
the discount rate.
    
    A decrease in goodwill impairment of US$16.3 million in the event of a 10% decrease in
the discount rate.
  Allowance for slow-moving and obsolete inventory
    16




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Allowance for impairment of receivables
  Accounting for income taxes
    Impact of Recently Issued Accounting Pronouncements
 ,
  17




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Results of Operations
 Year ended December 31, 2007 compared to the year ended December 31, 2006
 The following compares our results in the year ended December 31, 2007 to those of the year ended
December 31, 2006 under IFRS. Our analysis is divided as follows:
 1.
    
    Overview2.
    
    Revenues3.
    
    Operating Expenses4.
    
    Retained Profit
 1. Overview
  
    
    the rationalisation of the Haemostasis and Infectious Diseases reagent and
instrumentation product lines resulting in an inventory write off of US$11,772,000;
    
    the closure of the Groups operation in Sweden, resulting in an inventory write off of
US$147,000 (included in the total inventory write off in 2007 of US$11,772,000), a write
down of property, plant & equipment of US$42,000, termination payments of US$332,000 and
accrued lease obligations of US$116,000;
    
    the streamlining of the Groups development activities which resulted in a write off
of capitalised development and license costs of US$6,667,000 and,
    
    the reorganisation of the US sales force coupled with a redundancy programme to reduce
headcount across the Group resulting in additional termination payments of US$1,703,000
(exclusive of termination payments made as part of the closure of the Swedish
manufacturing operation of US$332,000). Total termination payments for the year amounted
to US$2,035,000 of which US$2,016,000 has been accrued at December 31, 2007.
 Impairment of Assets
  Restructuring
    
    
    Impairment
    
    
    TotalUS$000
    
    
    US$000
    
    
    US$000Cost of salesInventory provision
    
    
    11,772
    
    
    
    
    
    
    
    11,772Termination payments
    
    
    953
    
    
    
    
    
    
    
    95312,725
    
    
    
    
    
    
    
    12,725Research & developmentWrite-off of capitalised development and license costs
    
    
    6,667
    
    
    
    
    
    
    
    6,667Termination payments
    
    
    240
    
    
    
    
    
    
    
    2406,907
    
    
    
    
    
    
    
    6,907Selling, general & administration expensesImpairment of goodwill
    
    
    
    
    
    
    19,156
    
    
    
    19,156Termination payments
    
    
    842
    
    
    
    
    
    
    
    842Lease obligation provision
    
    
    116
    
    
    
    
    
    
    
    116Other
    
    
    201
    
    
    
    
    
    
    
    2011,159
    
    
    
    19,156
    
    
    
    20,315Total restructuring expenses and goodwill impairment
before tax
    
    
    20,791
    
    
    
    19,156
    
    
    
    39,947Income tax impact of restructuring expenses and
goodwill impairment
    
    
    (1,584
    )
    
    
    
    
    
    
    (1,584
    )Total restructuring expenses and goodwill impairment
after tax
    
    
    19,207
    
    
    
    19,156
    
    
    
    38,363
  18




---



##### Table of Contents



2. Revenues
      19




---



##### Table of Contents



Revenues by Product Line
  Year ended December 31,2007
    
    
    2006US$000
    
    
    US$000
    
    
    % ChangeRevenuesInfectious diseases
    
    
    41,293
    
    
    
    42,051
    
    
    
    (2
    %)Haemostasis
    
    
    60,759
    
    
    
    46,476
    
    
    
    31
    %Clinical Chemistry
    
    
    17,061
    
    
    
    14,868
    
    
    
    15
    %Point of Care
    
    
    24,504
    
    
    
    15,279
    
    
    
    60
    %Total
    
    
    143,617
    
    
    
    118,674
    
    
    
    21
    %
  Infectious Diseases Revenues
  Haemostasis Revenues
  Clinical Chemistry Revenues
  Point of Care
  Revenues by Geographical Region
  Year ended December 31,2007
    
    
    2006US$000
    
    
    US$000
    
    
    % ChangeRevenuesAmericas
    
    
    68,481
    
    
    
    60,748
    
    
    
    13
    %Europe
    
    
    43,631
    
    
    
    34,452
    
    
    
    27
    %Asia/Africa
    
    
    31,505
    
    
    
    23,474
    
    
    
    34
    %Total
    
    
    143,617
    
    
    
    118,674
    
    
    
    21
    %
  20




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##### Table of Contents




    
    An increase in haemostasis sales including the full year impact of bioMerieux
haemostasis products which was acquired in June 2006 (US$12,224,000);
    
    the growth in the sales of Trinitys Unigold rapid HIV test.
    3. Operating Expenses
  Year ended December 31,2007
    
    
    2006US$000
    
    
    US$000
    
    
    % ChangeRevenues
    
    
    143,617
    
    
    
    118,674
    
    
    
    21
    %Cost of sales
    
    
    (75,643
    )
    
    
    (62,090
    )
    
    
    22
    %Cost of sales  restructuring expenses
    
    
    (953
    )
    
    
    
    
    
    
    100
    %Cost of sales  inventory write off/ provision
    
    
    (11,772
    )
    
    
    (5,800
    )
    
    
    103
    %Gross profit
    
    
    55,249
    
    
    
    50,784
    
    
    
    9
    %Other operating income
    
    
    413
    
    
    
    275
    
    
    
    50
    %Research & development
    
    
    (6,802
    )
    
    
    (6,696
    )
    
    
    2
    %Research & development  restructuring expenses
    
    
    (6,907
    )
    
    
    
    
    
    
    100
    %SG&A expenses
    
    
    (51,010
    )
    
    
    (42,422
    )
    
    
    20
    %SG&A expenses  restructuring expenses
    
    
    (20,315
    )
    
    
    
    
    
    
    100
    %Operating (loss)/ profit
    
    
    (29,372
    )
    
    
    1,941
    
    
    
    (1614
    %)
 Cost of sales
    21




---



##### Table of Contents



Gross margin
  Research and development expenses
  Selling, General & Administrative expenses (SG&A)
  Year ended December 31,
    
    
    Increase/2007
    
    
    2006
    
    
    (decrease)US$000
    
    
    US$000
    
    
    US$000
    
    
    % ChangeSG&A (excl.
share-based payments
and amortisation)
    
    
    46,368
    
    
    
    38,719
    
    
    
    7,649
    
    
    
    20
    %SG&A restructuring
expenses and
goodwill impairment
    
    
    20,315
    
    
    
    
    
    
    
    20,315
    
    
    
    100
    %Share-based payments
    
    
    1,224
    
    
    
    1,016
    
    
    
    208
    
    
    
    20
    %Amortisation
    
    
    3,418
    
    
    
    2,687
    
    
    
    731
    
    
    
    27
    %Total
    
    
    71,325
    
    
    
    42,422
    
    
    
    28,903
    
    
    
    68
    %
 Selling General & Administrative Expenditure (excluding share-based payments and amortisation)
   22




---



##### Table of Contents




    
    Increased SG&A costs in the Head Office/Irish operations of US$4,327,000. This is
mainly due to a combination of strengthening of the Groups marketing and central
administration functions in conjunction with increased professional fees associated with
the implementation of Sarbanes Oxley;
    
    An increase of US$2,057,000 in the Groups European operations (excluding Ireland). Of
this increase, US$1,465,000 related to the full year impact of the direct sales operation
in France acquired in 2006. The remaining increase of US$592,000 arose principally in the
UK mainly due to the increase in employee numbers
and related costs associated with the expansion of this entity following the acquisition of
the haemostasis business of bioMerieux in 2006.
    
    Increased SG&A costs of US$1,265,000 in the USA. This is primarily due to the full year
impact of the increased personnel and related costs following the acquisition of the
haemostasis business of bioMerieux in June 2006.
 SG&A restructuring expenses and goodwill impairment
  Share-based payments
   Amortisation
    23




---



##### Table of Contents



4. ( Loss)/ profit for the year
  Year ended December 31,2007
    
    
    2006US$000
    
    
    US$000
    
    
    % ChangeOperating (loss)/ profit
    
    
    (29,372
    )
    
    
    1,941
    
    
    
    (1613
    %)Net financing costs
    
    
    (2,691
    )
    
    
    (1,489
    )
    
    
    81
    %(Loss)/ profit before tax
    
    
    (32,063
    )
    
    
    452
    
    
    
    (7194
    %)Income tax (expense)/ credit
    
    
    (3,309
    )
    
    
    2,824
    
    
    
    (217
    %)(Loss)/ profit of the year
    
    
    (35,372
    )
    
    
    3,276
    
    
    
    (1180
    %)
 Net Financing Costs
  Taxation
  (Loss)/ profit for the year
   24




---



##### Table of Contents



Year ended December 31, 2006 compared to the year ended December 31, 2005
 The following compares our results in the year ended December 31, 2006 to those of the year ended
December 31, 2005 under IFRS. Our analysis is divided as follows:
 1.
    
    Overview2.
    
    Revenues3.
    
    Operating Expenses4.
    
    Retained Profit
 1. Overview
     2. Revenues
      25




---



##### Table of Contents



Revenues by Product Line
  Year ended December 31,2006
    
    
    2005US$000
    
    
    US$000
    
    
    % ChangeRevenuesInfectious diseases
    
    
    42,051
    
    
    
    44,078
    
    
    
    (5
    %)Haemostasis
    
    
    46,476
    
    
    
    29,766
    
    
    
    56
    %Clinical Chemistry
    
    
    14,868
    
    
    
    11,880
    
    
    
    25
    %Point of Care
    
    
    15,279
    
    
    
    12,836
    
    
    
    19
    %Total
    
    
    118,674
    
    
    
    98,560
    
    
    
    20
    %
  Infectious Diseases
  Haemostasis Revenues
  Clinical Chemistry Revenues
  Point of Care
  Revenues by Geographical Region
  Year ended December 31,2006
    
    
    2005US$000
    
    
    US$000
    
    
    % ChangeRevenuesAmericas
    
    
    60,748
    
    
    
    50,627
    
    
    
    20
    %Europe
    
    
    34,452
    
    
    
    25,301
    
    
    
    36
    %Asia/Africa
    
    
    23,474
    
    
    
    22,632
    
    
    
    4
    %Total
    
    
    118,674
    
    
    
    98,560
    
    
    
    20
    %
  
    
    The inclusion of sales of US$9,822,000 of bioMerieux haemostasis products from the date
of acquisition in June 2006;
    
    The full year impact of Primus, which was acquired in July 2005, of US$3,012,000;
    
    Partially offset by the US$2,338,000 reduction in sales to Wampole.
  26




---



##### Table of Contents



3. Operating Expenses
  Year ended December 31,2006
    
    
    2005US$000
    
    
    US$000
    
    
    % ChangeRevenues
    
    
    118,674
    
    
    
    98,560
    
    
    
    20
    %Cost of sales
    
    
    (62,090
    )
    
    
    (51,378
    )
    
    
    21
    %Cost of sales  inventory provision
    
    
    (5,800
    )
    
    
    
    
    
    
    100
    %Gross profit
    
    
    50,784
    
    
    
    47,182
    
    
    
    8
    %Other operating income
    
    
    275
    
    
    
    161
    
    
    
    71
    %Research & development
    
    
    (6,696
    )
    
    
    (6,070
    )
    
    
    10
    %SG&A expenses
    
    
    (42,422
    )
    
    
    (34,651
    )
    
    
    23
    %Operating profit
    
    
    1,941
    
    
    
    6,622
    
    
    
    (71
    %)
 Cost of sales
   Gross Margin
  Research and development
   27




---



##### Table of Contents



Selling, General & Administrative expenses (SG&A)
  Year ended December 31,
    
    
    Increase/2006
    
    
    2005
    
    
    (decrease)US$000
    
    
    US$000
    
    
    US$000
    
    
    % ChangeSG&A (excl.
share-based payments
and amortisation)
    
    
    38,719
    
    
    
    31,800
    
    
    
    6,919
    
    
    
    22
    %Share-based payments
    
    
    1,016
    
    
    
    1,048
    
    
    
    (32
    )
    
    
    (3
    %)Amortisation
    
    
    2,687
    
    
    
    1,803
    
    
    
    884
    
    
    
    49
    %Total
    
    
    42,422
    
    
    
    34,651
    
    
    
    7,771
    
    
    
    23
    %
 Selling General & Administrative Expenditure
   
    
    Increased SG&A costs of US$3,901,000 in the USA. This is partially due to the full year
impact of Primus which was acquired in July 2005 of US$2,524,000. The remaining increase of
US$1,377,000 is mainly attributable to increased personnel and related costs following the
acquisition of the haemostasis business of bioMerieux;
    
    Increased SG&A costs in the Head Office/Irish operations of US$1,390,000. This is
mainly due to a combination of strengthening of the Groups marketing and central
administration functions in conjunction with the increase in scale of the Group and level
of activity of the Irish manufacturing operation;
    
    An increase of US$1,538,000 in the Groups European operations (excluding Ireland). Of
this increase US$363,000 related to the newly established direct sales operation in France.
The remaining increase of US$1,175,000 arose principally in Germany and UK mainly due to
the increase in employee numbers and related costs associated with the expansion of these
entities following the acquisition of the haemostasis business of bioMerieux.
 Share-based payments
   Amortisation
    28




---



##### Table of Contents



4. Profit for the year
  Year ended December 31,2006
    
    
    2005US$000
    
    
    US$000
    
    
    % ChangeOperating Profit
    
    
    1,941
    
    
    
    6,622
    
    
    
    (71
    %)Net financing costs
    
    
    (1,489
    )
    
    
    (669
    )
    
    
    123
    %Profit before tax
    
    
    452
    
    
    
    5,953
    
    
    
    (92
    %)Income tax credit/(expense)
    
    
    2,824
    
    
    
    (673
    )
    
    
    (520
    %)Profit of the year
    
    
    3,276
    
    
    
    5,280
    
    
    
    (38
    %)
 Net Financing Costs
  Taxation
  Profit for the year
  Liquidity and Capital Resources
 Financing
   29




---



##### Table of Contents



Working capital
   
    
    The ability of the Group to continue to generate revenue growth from its existing
product lines;
    
    The ability of the Group to generate revenues from new products following the successful
completion of its development projects;
    
    The extent to which capital expenditure is incurred on additional property plant and
equipment;
    
    The level of investment required to undertake both new and existing development
projects;
    
    Successful working capital management in the context of a growing group.
    Cash management
   30




---



##### Table of Contents




    
    A decrease in accounts receivable by US$5,226,000 due to better collections of
outstanding debtor receipts;
    
    An increase in trade and other payables by US$1,966,000 due to the combination of
increased activity in the Group, including the impact of the acquisitions undertaken during
the year;
    
    An increase in inventory by US$7,101,000 due to a combination of increased activity in
the Group and the building up safety stock levels on key finished products.
   
    
    Payments for acquisitions in 2007 (US$4,414,000) consisting of payments for the
acquisition of the immuno-technology business of Cortex of US$2,925,000 (including
acquisition expenses) and payments for the acquisition of certain components of the
distribution business of Sterilab of US$1,489,000 (including acquisition expenses). In
addition, payments were made during 2007 relating to acquisitions in 2006 totalling
US$3,472,000. Deferred consideration of US$3,208,000 and US$239,000 was paid to bioMerieux
and Nephrotek respectively during 2007. A further amount of US$25,000 was paid during 2007
relating to accrued acquisition expenses at December 31, 2006;
    
    Payments to acquire intangible assets of US$7,851,000 (2006: US$6,085,000), which
principally related to development expenditure capitalised as part of the Groups on-going
product development activities;
    
    Acquisition of property, plant and equipment of US$8,262,000 (2006: US$4,751,000)
incurred as part of the Groups investment programme for its manufacturing and distribution
activities;
    
    Movements in financial fixed assets, which resulted in a cash inflow of US$15,500,000 in
2007 (2006: a cash outflow of US$6,500,000), was due to the requirement to maintain a
certain level of cash deposits (restricted cash) with the Groups lending banks being
removed during 2007. At December 31, 2006 the Group was required to keep US$15,500,000 on
deposit as restricted cash with its lending banks. This restriction was removed during
2007, resulting in a cash outflow from investing activities of US$15,500,000 in 2007.
   31




---



##### Table of Contents



Contractual obligations
  Payments due by Periodless than 1
    
    
    
    
    
    
    
    
    
    
    more thanTotal
    
    
    year
    
    
    1-3 Years
    
    
    3-5 Years
    
    
    5 yearsContractual Obligations
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Bank loans
    
    
    44,330
    
    
    
    17,497
    
    
    
    18,430
    
    
    
    8,403
    
    
    
    Capital (finance) lease
obligations
    
    
    2,616
    
    
    
    779
    
    
    
    1,048
    
    
    
    789
    
    
    
    Other financial liabilities
    
    
    2,725
    
    
    
    2,725
    
    
    
    
    
    
    
    
    
    
    
    Operating lease obligations
    
    
    62,551
    
    
    
    4,943
    
    
    
    8,050
    
    
    
    6,436
    
    
    
    43,122Total
    
    
    112,222
    
    
    
    25,944
    
    
    
    27,528
    
    
    
    15,628
    
    
    
    43,122
  Impact of Inflation
  Impact of Currency Fluctuation
    32




---



##### Table of Contents



Off-Balance Sheet Arrangements
  Leases with Related Parties
  Research & Development (R&D) carried out by third parties
  Research and Products under Development
 History
  Centres of Excellence
   Microtitre Plate Development Group
 Development of microtitre plate assay for the detection of EU Lyme IgG and IgM
  HIV Incidence Assay
  Western Blot Development Group
  US Lyme Western Blot
   33




---



##### Table of Contents



Automated Blotting Instrument and Blot Scanner
  Clinical Chemistry
 TriStat POC
  Haemoglobin assay development
  Medium throughput HPLC for Haemoglobin testing
  Haemostasis Development Group
 Destiny Max Development Project
  Trend Information
   34




---



##### Table of Contents



Item 6 Directors and Senior Management
 Directors
 Name
    
    Age
    
    TitleRonan OCaoimh
    
    
    52
    
    
    Executive ChairmanBrendan K. Farrell
    
    
    60
    
    
    Chief Executive OfficerRory Nealon
    
    
    40
    
    
    Director, Chief Operations OfficerJim Walsh, PhD
    
    
    49
    
    
    Non Executive DirectorDenis R. Burger, PhD
    
    
    64
    
    
    Non Executive DirectorPeter Coyne
    
    
    48
    
    
    Non Executive DirectorExecutive OfficersKevin Tansley
    
    
    37
    
    
    Chief Financial Officer & Company Secretary
 Board of Directors & Executive Officers
 Ronan OCaoimh, Executive Chairman
 Brendan Farrell, Chief Executive Officer
 Rory Nealon, Chief Operations Officer
 Jim Walsh, PhD, Non-executive director
  35




---



##### Table of Contents



Denis R. Burger, PhD, Non-executive director
 Peter Coyne, Non-executive director
 Kevin Tansley, Chief Financial Officer
 Compensation of Directors and Officers
   DefinedSalary/
    
    
    Performance
    
    
    contribution
    
    
    Total
    
    
    TotalBenefits
    
    
    related bonus
    
    
    pension
    
    
    2007
    
    
    2006Director
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Ronan OCaoimh
    
    
    656
    
    
    
    207
    
    
    
    64
    
    
    
    927
    
    
    
    854Brendan Farrell
    
    
    509
    
    
    
    125
    
    
    
    47
    
    
    
    681
    
    
    
    602Rory Nealon
    
    
    365
    
    
    
    124
    
    
    
    20
    
    
    
    509
    
    
    
    377Jim Walsh
    
    
    169
    
    
    
    85
    
    
    
    16
    
    
    
    270
    
    
    
    3991,699
    
    
    
    541
    
    
    
    147
    
    
    
    2,387
    
    
    
    2,232
 Total
    
    
    TotalNon-executive
    
    Fees
    
    
    2007
    
    
    2006director
    
    US$000
    
    
    US$000
    
    
    US$000Denis R. Burger
    
    
    65
    
    
    
    65
    
    
    
    50Peter Coyne
    
    
    65
    
    
    
    65
    
    
    
    50130
    
    
    
    130
    
    
    
    100
  36




---



##### Table of Contents



Chief Financial
    
    
    
    
    
    
    
    
    
    DefinedOfficer &
    
    Salary/
    
    
    Performance
    
    
    contribution
    
    
    Total
    
    
    TotalCompany
    
    Benefits
    
    
    related bonus
    
    
    pension
    
    
    2007
    
    
    2006Secretary
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Kevin Tansley *
    
    
    53
    
    
    
    
    
    
    
    2
    
    
    
    55
    
    
    
    53
    
    
    
    
    
    
    
    2
    
    
    
    55
    
    
    
    
 *
    
    appointed November 1, 2007
     Board Practices
      37




---



##### Table of Contents



Employees
   Stock Option Plan
    Number of A
    
    
    Range of
    
    
    Range ofOrdinary Shares
    
    
    Exercise Price
    
    
    Exercise PriceSubject to Option
    
    
    per Ordinary Share
    
    
    per ADSTotal options outstanding
    
    
    7,788,878
    
    
    US$0.98-US$4.00
    
    
    US$
    3.92-US$16.00
  
 Item 7 Major Shareholders and Related Party Transactions
     38




---



##### Table of Contents



Number of A
    
    
    Percentage
    
    
    Number of B
    
    
    Percentage
    
    
    PercentageOrdinary Shares
    
    
    Outstanding
    
    
    Ordinary Shares
    
    
    Outstanding
    
    
    TotalBeneficially
    
    
    A Ordinary
    
    
    Beneficially
    
    
    B Ordinary
    
    
    VotingOwned
    
    
    Shares
    
    
    Owned
    
    
    Shares
    
    
    PowerRonan OCaoimh
    
    
    4,837,287
    (1)
    
    
    6.4
    %
    
    
    
    
    
    
    
    
    
    
    6.3
    %Brendan Farrell
    
    
    1,934,135
    (2)
    
    
    2.5
    %
    
    
    
    
    
    
    
    
    
    
    2.5
    %Rory Nealon
    
    
    531,250
    (3)
    
    
    0.7
    %
    
    
    
    
    
    
    
    
    
    
    0.7
    %Jim Walsh
    
    
    1,889,240
    (4)
    
    
    2.5
    %
    
    
    
    
    
    
    
    
    
    
    2.5
    %Denis R. Burger
    
    
    182,833
    (5)
    
    
    0.2
    %
    
    
    
    
    
    
    
    
    
    
    0.2
    %Peter Coyne
    
    
    155,833
    (6)
    
    
    0.2
    %
    
    
    
    
    
    
    
    
    
    
    0.2
    %Kevin Tansley
    
    
    39,999
    (7)
    
    
    0.05
    %
    
    
    
    
    
    
    
    
    
    
    0.05
    %Potenza Investments
Inc,
(Potenza)
Statenhof Building,
Reaal 2A 23 50AA
Leiderdorp
Netherlands
    
    
    
    
    
    
    
    
    
    
    500,000
    (8)
    
    
    71.4
    %
    
    
    1.3
    %Officers and
Directors as a
group (7 persons)
    
    
    9,570,577
    (1)(2)(3)(4)(5)(6)(7)
    
    
    12.55
    %
    
    
    
    
    
    
    
    
    
    
    12.0
    %
 (1)
    
    Includes 1,145,832 shares issuable upon exercise of options.(2)
    
    Includes 1,345,000 shares issuable upon exercise of options.(3)
    
    Includes 331,250 shares issuable upon exercise of options.(4)
    
    Includes 535,625 shares issuable upon exercise of options.(5)
    
    Includes 135,833 shares issuable upon exercise of options.(6)
    
    Includes 155,833 shares issuable upon exercise of options.(7)
    
    Includes 39,999 shares issuable upon exercise of options.(8)
    
    These B shares have two votes per share. Related Party Transactions
     
 
  39




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##### Table of Contents



 
      
 Item 8 Financial Information
 Legal Proceedings
  
 Item 9 The Offer and Listing
   40




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##### Table of Contents



ADSsHigh
    
    
    LowYear Ended December 312003
    
    $
    26.88
    
    
    $
    5.002004
    
    $
    23.96
    
    
    $
    9.402005
    
    $
    11.72
    
    
    $
    6.282006
    
    $
    9.54
    
    
    $
    7.092007
    
    $
    11.75
    
    
    $
    5.722006Quarter ended March 31
    
    $
    9.31
    
    
    $
    8.20Quarter ended June 30
    
    $
    9.51
    
    
    $
    7.45Quarter ended September 30
    
    $
    9.30
    
    
    $
    7.09Quarter ended December 31
    
    $
    9.54
    
    
    $
    8.342007Quarter ended March 31
    
    $
    10.45
    
    
    $
    8.68Quarter ended June 30
    
    $
    11.74
    
    
    $
    9.13Quarter ended September 30
    
    $
    11.75
    
    
    $
    10.05Quarter ended December 31
    
    $
    11.40
    
    
    $
    5.72Month EndedMarch 31, 2007
    
    $
    10.05
    
    
    $
    8.81April 30, 2007
    
    $
    10.82
    
    
    $
    9.13May 31, 2007
    
    $
    11.28
    
    
    $
    10.51June 30, 2007
    
    $
    11.74
    
    
    $
    11.11July 31, 2007
    
    $
    11.75
    
    
    $
    10.33August 31, 2007
    
    $
    11.45
    
    
    $
    10.05September 30, 2007
    
    $
    11.41
    
    
    $
    10.25October 31, 2007
    
    $
    11.40
    
    
    $
    8.76November 30, 2007
    
    $
    9.28
    
    
    $
    8.10December 31, 2007
    
    $
    8.45
    
    
    $
    5.72January 31, 2008
    
    $
    6.95
    
    
    $
    6.20February 29, 2008
    
    $
    6.55
    
    
    $
    4.52
   41




---



##### Table of Contents



Item 10 Memorandum and
Articles of Association
 Objects
  Powers and Duties of Directors
      Rights, Preferences and Restrictions Attaching to Shares
     42




---



##### Table of Contents



Action Necessary to Change the Rights of Shareholders
  Calling of AGMs and EGMs of Shareholders
     43




---



##### Table of Contents



Other Provisions of the Memorandum and Articles of Association
  
    
    which would have an effect of delaying, deferring or preventing a change in control of the
Company and which would operate only with respect to a merger, acquisition or corporate
restructuring involving the Company (or any of its subsidiaries); or
    
    governing the ownership threshold above which a shareholder ownership must be disclosed; or
    
    imposing conditions governing changes in the capital which are more stringent than is
required by Irish law.
  Irish Law
    Material Contracts
   44




---



##### Table of Contents



Exchange Controls and Other Limitations
Affecting Security Holders
     Taxation
      45




---



##### Table of Contents



US Federal Income Tax Consequences to US Holders
         46




---



##### Table of Contents



47




---



##### Table of Contents



48




---



##### Table of Contents



Republic of Ireland Taxation
          49




---



##### Table of Contents




    
    the depository banks ADS register shows that the direct beneficial owner of the
dividends has a US address on the register, or
    
    there is an intermediary between the depository bank and the beneficial shareholder and
the depository bank receives confirmation from the intermediary that the beneficial
shareholders address in the intermediarys records is in the US.
   
    
    an individual resident in the US (or certain other countries with which Ireland has a
double taxation treaty) and who is neither resident nor ordinarily resident in Ireland; or
    
    a corporation that is not resident in Ireland and which is ultimately controlled by
persons resident in the US (or certain other countries with which Ireland has a double
taxation treaty); or
    
    a corporation that is not resident in Ireland and whose principal class of shares (or
its 75% parents principal class of shares) are substantially or regularly traded on a
recognised stock exchange; or
    
    is otherwise entitled to an exemption from DWT.
 Disposals of Ordinary Shares or ADSs
   
   50




---



##### Table of Contents



. 
  
 
  
  51




---



##### Table of Contents



Dividend Policy
   Documents on Display
  
 Item 11 Qualitative and Quantitative Disclosures about Market Risk
 Qualitative information about Market Risk
         52




---



##### Table of Contents



Quantitative information about Market Risk
 Interest rate sensitivity
    GroupMaturity
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    After
    
    
    
    
    
    
    FairBefore December 31
    
    2008
    
    
    2009
    
    
    2010
    
    
    2011
    
    
    2012
    
    
    2013
    
    
    Total
    
    
    valueLong-term debtVariable rate  US$000
    
    
    15,146
    
    
    
    8,183
    
    
    
    8,221
    
    
    
    8,258
    
    
    
    
    
    
    
    
    
    
    
    39,808
    
    
    
    39,808Average interest rate
    
    
    6.74
    %
    
    
    6.74
    %
    
    
    6.74
    %
    
    
    6.74
    %
    
    
    
    
    
    
    
    
    
    
    6.74
    %Fixed rate  US$000
    
    
    674
    
    
    
    464
    
    
    
    438
    
    
    
    460
    
    
    
    289
    
    
    
    
    
    
    
    2,325
    
    
    
    2,318Average interest rate
    
    
    5.88
    %
    
    
    6.28
    %
    
    
    6.14
    %
    
    
    6.12
    %
    
    
    6.12
    %
    
    
    
    
    
    
    6.09
    %
 Exchange rate sensitivity
   
 Item 12 Description of Securities Other than Equity Securities
   53




---



##### Table of Contents



Part II
 
 Item 13 Defaults, Dividend Arrearages and Delinquencies
  
 Item 14 Material Modifications to the Rights of Security Holders and Use of Proceeds
  
 Item 15 Control and Procedures
 Evaluation of Disclosure Controls and Procedures
 .
  Managements Annual Report on Internal Control over Financial Reporting
      54




---



##### Table of Contents



Changes in Internal Controls over Financial Reporting
  ,
 Item 16
 
 16A Audit Committee Financial Expert
    
 16B Code of Ethics
  
 16C Principal Accounting fees and services
 Fees Billed by Independent Public Accountants
 Year ended December 31,
    
    
    Year ended December 31,2007
    
    
    2006US$000
    
    
    %
    
    
    US$000
    
    
    %Audit
    
    
    997
    
    
    
    93
    %
    
    
    683
    
    
    
    75
    %Audit-related
    
    
    
    
    
    
    
    
    
    
    206
    
    
    
    23
    %Tax
    
    
    71
    
    
    
    7
    %
    
    
    20
    
    
    
    2
    %Total
    
    
    1,068
    
    
    
    
    
    
    
    909
   55




---



##### Table of Contents



Pre-Approval Policies and Procedures
  Exemptions from the Listing Requirements and Standards for Audit Committee
  Purchase of equity securities by the issuer and affiliates and purchasers
  
 Part III
 
 Item 17 Financial Statements
  
 Item 18 Financial Statements
  56




---



##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  Internal Control  Integrated Framework
    Internal
Control  Integrated Framework
  
  57




---



##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
     Internal Control  Integrated
Framework
 
  58




---



##### Table of Contents



CONSOLIDATED STATEMENTS OF OPERATIONS
 Year ended December, 312007
    
    
    2006
    
    
    2005Total
    
    
    Total
    
    
    TotalNotes
    
    US$000
    
    
    US$000
    
    
    US$000Revenues
    
    2
    
    
    143,617
    
    
    
    118,674
    
    
    
    98,560Cost of sales
    
    
    
    
    (75,643
    )
    
    
    (62,090
    )
    
    
    (51,378
    )Cost of sales  restructuring expenses
    
    3
    
    
    (953
    )
    
    
    
    
    
    
    Cost of sales  inventory write off/ provision
    
    3, 2
    
    
    (11,772
    )
    
    
    (5,800
    )
    
    
    Total cost of sales
    
    
    
    
    (88,368
    )
    
    
    (67,890
    )
    
    
    (51,378
    )Gross profit
    
    
    
    
    55,249
    
    
    
    50,784
    
    
    
    47,182Other operating income
    
    5
    
    
    413
    
    
    
    275
    
    
    
    161Research and development expenses
    
    
    
    
    (6,802
    )
    
    
    (6,696
    )
    
    
    (6,070
    )Research and development  restructuring expenses
    
    3
    
    
    (6,907
    )
    
    
    
    
    
    
    Total research and development expenses
    
    
    
    
    (13,709
    )
    
    
    (6,696
    )
    
    
    (6,070
    )Selling, general and administrative expenses
    
    
    
    
    (51,010
    )
    
    
    (42,422
    )
    
    
    (34,651
    )Selling, general and administrative  restructuring
expenses (including goodwill impairment of
US$19,156,000)
    
    3
    
    
    (20,315
    )
    
    
    
    
    
    
    Total selling, general and administrative expenses
    
    
    
    
    (71,325
    )
    
    
    (42,422
    )
    
    
    (34,651
    )Operating (loss)/ profit
    
    
    
    
    (29,372
    )
    
    
    1,941
    
    
    
    6,622Financial income
    
    4
    
    
    457
    
    
    
    1,164
    
    
    
    389Financial expenses
    
    2, 4
    
    
    (3,148
    )
    
    
    (2,653
    )
    
    
    (1,058
    )Net financing costs
    
    
    
    
    (2,691
    )
    
    
    (1,489
    )
    
    
    (669
    )(Loss)/ profit before tax
    
    6
    
    
    (32,063
    )
    
    
    452
    
    
    
    5,953Total income tax (expense)/ credit
    
    2, 9
    
    
    (3,309
    )
    
    
    2,824
    
    
    
    (673
    )(Loss)/ profit for the year (all attributable to equity
holders)
    
    2
    
    
    (35,372
    )
    
    
    3,276
    
    
    
    5,280Basic (loss)/ earnings per ordinary share (US Dollars)
    
    10
    
    
    (0.47
    )
    
    
    0.05
    
    
    
    0.09Diluted (loss)/ earnings per ordinary share (US Dollars)
    
    10
    
    
    (0.47
    )
    
    
    0.05
    
    
    
    0.09Basic (loss)/ earnings per ADS (US Dollars)
    
    10
    
    
    (1.86
    )
    
    
    0.19
    
    
    
    0.36Diluted (loss)/ earnings per ADS (US Dollars)
    
    10
    
    
    (1.86
    )
    
    
    0.19
    
    
    
    0.35
  59




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##### Table of Contents



CONSOLIDATED STATEMENTS OF RECOGNISED INCOME AND EXPENSE
 Year ended December, 312007
    
    
    2006
    
    
    2005Notes
    
    US$000
    
    
    US$000
    
    
    US$000Foreign exchange translation differences
    
    19
    
    
    1,072
    
    
    
    1,347
    
    
    
    (1,740
    )Cash flow hedges:Effective portion of changes in fair value
    
    
    
    
    224
    
    
    
    226
    
    
    
    (295
    )Deferred tax on income and expenses
recognised directly in equity
    
    
    
    
    (23
    )
    
    
    4
    
    
    
    41Net income/ (expense) recognised directly in equity
    
    
    
    
    1,273
    
    
    
    1,577
    
    
    
    (1,994
    )Cash flow hedge recycled
to the statement of operations
    
    
    
    
    
    
    
    
    (166
    )
    
    
    (183
    )(Loss)/ profit for the year
    
    2
    
    
    (35,372
    )
    
    
    3,276
    
    
    
    5,280Total recognised income
and expense (all attributable to equity holders)
    
    
    
    
    (34,099
    )
    
    
    4,687
    
    
    
    3,103
  60




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##### Table of Contents



CONSOLIDATED BALANCE SHEETS
 December 31,
    
    
    December 31,2007
    
    
    2006Notes
    
    US$000
    
    
    US$000ASSETSNon-current assetsProperty, plant and equipment
    
    11
    
    
    26,409
    
    
    
    22,255Goodwill and intangible assets
    
    12
    
    
    104,928
    
    
    
    121,768Deferred tax assets
    
    13
    
    
    3,937
    
    
    
    7,656Other assets
    
    14
    
    
    896
    
    
    
    515Total non-current assets
    
    
    
    
    136,170
    
    
    
    152,194Current assetsInventories
    
    15
    
    
    44,420
    
    
    
    45,572Trade and other receivables
    
    16
    
    
    25,683
    
    
    
    32,676Income tax receivable
    
    
    
    
    782
    
    
    
    368Derivative financial instruments
    
    30
    
    
    224
    
    
    
    Financial assets  restricted cash
    
    17
    
    
    
    
    
    
    15,500Cash and cash equivalents
    
    18
    
    
    8,700
    
    
    
    2,821Total current assets
    
    
    
    
    79,809
    
    
    
    96,937TOTAL ASSETS
    
    2
    
    
    215,979
    
    
    
    249,131EQUITY AND LIABILITIESEquity attributable to the equity holders of the parentShare capital
    
    19
    
    
    991
    
    
    
    978Share premium
    
    19
    
    
    153,961
    
    
    
    151,774(Accumulated deficit)/ retained earnings
    
    19
    
    
    (22,908
    )
    
    
    10,818Translation reserve
    
    19
    
    
    797
    
    
    
    (275
    )Other reserves
    
    19
    
    
    4,004
    
    
    
    3,967Total equity
    
    
    
    
    136,845
    
    
    
    167,262Current liabilitiesInterest-bearing loans and borrowings
    
    21
    
    
    15,821
    
    
    
    10,382Convertible notes-interest bearing
    
    22
    
    
    
    
    
    
    1,836Income tax payable
    
    
    
    
    86
    
    
    
    44Trade and other payables
    
    23
    
    
    24,779
    
    
    
    20,459Other financial liabilities
    
    24
    
    
    2,725
    
    
    
    3,120Provisions
    
    25
    
    
    100
    
    
    
    100Total current liabilities
    
    
    
    
    43,511
    
    
    
    35,941Non-current liabilitiesInterest-bearing loans and borrowings
    
    21
    
    
    26,312
    
    
    
    33,076Other financial liabilities
    
    24
    
    
    
    
    
    
    2,568Other payables
    
    26
    
    
    74
    
    
    
    838Deferred tax liabilities
    
    13
    
    
    9,237
    
    
    
    9,446Total non-current liabilities
    
    
    
    
    35,623
    
    
    
    45,928TOTAL LIABILITIES
    
    2
    
    
    79,134
    
    
    
    81,869TOTAL EQUITY AND LIABILITIES
    
    
    
    
    215,979
    
    
    
    249,131
  61




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##### Table of Contents



CONSOLIDATED STATEMENT OF CASH FLOWS
 Year ended December 31,2007
    
    
    2006
    
    
    2005Notes
    
    US$000
    
    
    US$000
    
    
    US$000Cash flows from operating activities(Loss)/ profit for the year
    
    
    
    
    (35,372
    )
    
    
    3,276
    
    
    
    5,280Adjustments to reconcile net profit to cash provided
by operating activities:Depreciation
    
    
    
    
    4,341
    
    
    
    3,736
    
    
    
    2,434Amortisation
    
    
    
    
    3,418
    
    
    
    2,687
    
    
    
    1,803Income tax expense/ (credit)
    
    
    
    
    3,309
    
    
    
    (2,824
    )
    
    
    673Financial income
    
    
    
    
    (457
    )
    
    
    (1,164
    )
    
    
    (389
    )Financial expense
    
    
    
    
    3,148
    
    
    
    2,653
    
    
    
    1,058Share-based payments
    
    
    
    
    1,403
    
    
    
    1,141
    
    
    
    1,368Foreign exchange losses on operating cash flows
    
    
    
    
    (26
    )
    
    
    (100
    )
    
    
    (292
    )Loss/ (profit) on disposal / retirement of property,
plant and equipment
    
    
    
    
    17
    
    
    
    (2
    )
    
    
    469Goodwill impairment
    
    3
    
    
    19,156
    
    
    
    
    
    
    
    Non- cash restructuring expenses
    
    3
    
    
    18,573
    
    
    
    
    
    
    
    Inventory write off
    
    
    
    
    
    
    
    
    5,800
    
    
    
    Other non-cash items
    
    
    
    
    577
    
    
    
    469
    
    
    
    232Operating cash flows before changes in working capital
    
    
    
    
    18,087
    
    
    
    15,672
    
    
    
    12,636Decrease/ (increase) in trade and other receivables
    
    
    
    
    5,226
    
    
    
    (9,962
    )
    
    
    (8,034
    )(Increase)/ decrease in inventories
    
    
    
    
    (7,101
    )
    
    
    (5,434
    )
    
    
    1,311Increase in trade and other payables
    
    
    
    
    1,966
    
    
    
    8,041
    
    
    
    4,689Cash generated from operations
    
    
    
    
    18,178
    
    
    
    8,317
    
    
    
    10,602Interest paid
    
    
    
    
    (2,802
    )
    
    
    (1,642
    )
    
    
    (972
    )Interest received
    
    
    
    
    429
    
    
    
    839
    
    
    
    371Income taxes paid
    
    
    
    
    (456
    )
    
    
    (146
    )
    
    
    (792
    )Net cash provided by operating activities
    
    
    
    
    15,349
    
    
    
    7,368
    
    
    
    9,209Cash flows from investing activitiesPayments to acquire subsidiaries and businesses
    
    27
    
    
    (4,414
    )
    
    
    (39,334
    )
    
    
    (13,129
    )Deferred consideration to acquire subsidiaries and
businesses
    
    
    
    
    (3,472
    )
    
    
    (6,802
    )
    
    
    Cash received with subsidiary
    
    
    
    
    
    
    
    
    
    
    
    
    127Payments to acquire intangible assets
    
    
    
    
    (7,851
    )
    
    
    (6,085
    )
    
    
    (5,509
    )Disposal/ (acquisition) of financial assets
    
    
    
    
    15,500
    
    
    
    (6,500
    )
    
    
    (1,852
    )Proceeds from disposal of property, plant and equipment
    
    
    
    
    84
    
    
    
    205
    
    
    
    4Acquisition of property, plant and equipment
    
    
    
    
    (8,262
    )
    
    
    (4,751
    )
    
    
    (4,039
    )Net cash used in investing activities
    
    
    
    
    (8,415
    )
    
    
    (63,267
    )
    
    
    (24,398
    )Cash flows from financing activitiesProceeds from issue of ordinary share capital
    
    
    
    
    454
    
    
    
    25,265
    
    
    
    4,755Proceeds from borrowings, short-term debt
    
    
    
    
    5,000
    
    
    
    6,000
    
    
    
    1,800Proceeds from borrowings, long-term debt
    
    
    
    
    
    
    
    
    24,000
    
    
    
    7,200Expenses paid in connection with share issue and debt
financing
    
    
    
    
    (70
    )
    
    
    (1,526
    )
    
    
    (195
    )Repayment of long-term debt
    
    
    
    
    (8,285
    )
    
    
    (1,276
    )
    
    
    (1,217
    )Proceeds from new finance leases
    
    
    
    
    2,087
    
    
    
    78
    
    
    
    154Payment of finance lease liabilities
    
    
    
    
    (294
    )
    
    
    (276
    )
    
    
    (348
    )Repayment of convertible debt
    
    
    
    
    
    
    
    
    (3,644
    )
    
    
    (1,822
    )Repayment of other financial liabilities
    
    
    
    
    
    
    
    
    
    
    
    
    (648
    )Net cash provided by (used in) financing activities
    
    
    
    
    (1,108
    )
    
    
    48,621
    
    
    
    9,679Increase/ (decrease) in cash and cash equivalents
    
    
    
    
    5,826
    
    
    
    (7,278
    )
    
    
    (5,510
    )Effects of exchange rate movements on cash held
    
    
    
    
    53
    
    
    
    218
    
    
    
    252Cash and cash equivalents at beginning of year
    
    
    
    
    2,821
    
    
    
    9,881
    
    
    
    15,139Cash and cash equivalents at end of year
    
    18
    
    
    8,700
    
    
    
    2,821
    
    
    
    9,881
  62




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 20071.
    
    BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIESThe principal accounting policies adopted by Trinity Biotech plc and its subsidiaries, (the
Group), are as follows:a)
    
    Statement of complianceThe consolidated financial statements have been prepared in accordance with International
Financial Reporting Standards (IFRS) both as issued by the International Accounting Standards
Board (IASB) and as subsequently adopted by the European Union (EU) (together IFRS). The
IFRS applied are those effective for accounting periods beginning on or after 1 January
2007. Consolidated financial statements are required by Irish law to comply with IFRS as adopted
by the EU which differ in certain respects from IFRS as issued by the IASB. These differences
predominantly relate to the timing of adoption of new standards by the EU. However, as none of
the differences are relevant in the context of Trinity Biotech, the consolidated financial
statements for the periods presented comply with IFRS both as issued by the IASB and as adopted
by the EU.b)
    
    Basis of preparationThe consolidated financial statements have been prepared in United States Dollars (US$), rounded to
the nearest thousand, under the historical cost basis of accounting, except for derivative
financial instruments and share-based payments which are initially recorded at fair value.
Derivatives are also subsequently carried at fair value.The preparation of financial statements in conformity with IFRS requires management to make
judgements, estimates and assumptions that affect the application of policies and amounts reported
in the financial statements and accompanying notes. The estimates and associated assumptions are
based on historical experience and various other factors that are believed to be reasonable under
the circumstances, the results of which form the basis of making the judgements about the carrying
value of assets and liabilities that are not readily apparent from other sources. Actual results
may differ from these estimates.The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised if the revision affects
only that period or in the period of the revision and future periods if the revision affects both
current and future periods.Judgements made by management that have a significant effect on the financial statements and
estimates with a significant risk of material adjustment in the next year are discussed in note
31.Having considered the Groups current financial position, its cashflow projections, its existing
bank debt facility and other potential sources of funding available to the Group, the directors
believe that the Group will be able to continue in operational existence for at least the next 12
months from the date of approval of these consolidated financial statements and that it is
appropriate to continue to prepare the consolidated financial statements on a going concern basis.The accounting policies set out below have been applied consistently to all periods presented in
these consolidated financial statements. The accounting policies have been applied consistently by
all Group entities.Certain prior year amounts have been reclassified to conform to current presentation.c)
    
    Basis of consolidationSubsidiariesSubsidiaries are entities controlled by the Company. Control exists when the Company has the
power, directly or indirectly, to govern the financial and reporting policies of an entity so as to
obtain benefits from its activities. In assessing control, potential voting rights that presently
are exercisable or convertible are taken into account. The financial statements of subsidiaries
are included in the consolidated financial statements from the date that control commences until
the date that control ceases.Transactions eliminated on consolidationIntra-group balances and any unrealised gains or losses or income and expenses arising from
intra-group transactions are eliminated in preparing the consolidated financial statements.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007d)
    
    Property, plant and equipmentOwned assetsItems of property, plant and equipment are stated at cost less any accumulated depreciation and any
impairment losses (see note 1(h)). The cost of self-constructed assets includes the cost of
materials, direct labour and attributable overheads. It is not Group policy to revalue any items
of property, plant and equipment.Depreciation is charged to the statement of operations on a straight-line basis to write-off the
cost of the assets over their expected useful lives as follows:
 
    
    Leasehold improvements
    
    5-10 years
    
    Office equipment and fittings
    
    10 years
    
    Buildings
    
    50 years
    
    Computer equipment
    
    3-5 years
    
    Plant and equipment
    
    5-10 years
 Land is not depreciated. The residual values, if not insignificant, useful lives and depreciation
methods of property, plant and equipment are reviewed and adjusted if appropriate, at each balance
sheet date.Leased assets  as lesseeLeases under terms of which the Group assumes substantially all the risks and rewards of ownership
are classified as finance leases. Property, plant and equipment acquired by way of finance lease
is stated at an amount equal to the lower of its fair value and present value of the minimum lease
payments at inception of the lease, less accumulated depreciation and any impairment losses.Depreciation is calculated in order to write-off the amounts capitalised over the estimated useful
lives of the assets, or the lease term if shorter, by equal annual instalments. The excess of the
total rentals under a lease over the amount capitalised is treated as interest, which is charged to
the statement of operations in proportion to the amount outstanding under the lease. Leased assets
are reviewed for impairment (see note 1(h)).Leases other than finance leases are classified as operating leases, and the rentals thereunder
are charged to the statement of operations on a straight line basis over the period of the leases.
Lease incentives are recognised in the statement of operations on a straight-line basis over the
lease term.Leased assets  as lessorLeases where the Group substantially transfers the risks and benefits of ownership of the asset to
the customer are classified as finance leases within finance lease receivables. The Group
recognises the amount receivable from assets leased under finance leases at an amount equal to the
net investment in the lease. Finance lease income is recognised as revenue in the statement of
operations reflecting a constant periodic rate of return on the Groups net investment in the
lease.Assets provided to customers under leases other than finance leases are classified as operating
leases and carried in property, plant and equipment at cost and are depreciated on a straight-line
basis over the useful life of the asset or the lease term, if shorter.Subsequent costsThe Group recognises in the carrying amount of an item of property, plant and equipment the cost of
replacing part of such an item when that cost is incurred if it is probable that the future
economic benefits embodied within the item will flow to the Group and the cost of the replaced item
can be measured reliably. All other costs are recognised in the statement of operations as an
expense as incurred.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2007e)
    
    Business combinationsAll business combinations are accounted for by applying the purchase method.The cost of a business combination is measured as the aggregate of the fair values at the date of
exchange of assets given, liabilities incurred or assumed and equity instruments issued in exchange
for control together with any directly attributable expenses. To the extent that settlement of all or
any part of a business combination is deferred for a period of 12 months or longer, the fair value
of the deferred component is determined through discounting the amounts payable to their present
value at the date of exchange. The discount component is unwound as an interest charge in the
statement of operations over the life of the obligation.Where a business combination agreement provides for an adjustment to the cost of the combination
contingent on future events, the estimated present value of the adjustment is included in the cost
at the acquisition date. Changes in these amounts subsequently are reflected in goodwill.When the initial accounting for a business combination is determined provisionally, any subsequent
adjustments to the provisional values allocated to the identifiable assets, liabilities and
contingent liabilities are made within twelve months of the acquisition date and treated
retrospectively as an adjustment to goodwill.f)
    
    GoodwillIn respect of business combinations that have occurred since January 1, 2004 (being the transition
date to IFRS), goodwill represents the difference between the cost of the acquisition and the fair
value of the net identifiable assets acquired.In respect of acquisitions prior to this date, goodwill is included on the basis of its deemed
cost, which represents the amount recorded under the old basis of accounting, Irish GAAP,
(Previous GAAP). Save for retrospective restatement of deferred tax as an adjustment to retained
earnings in accordance with IAS 12, Income Taxes,the classification and accounting treatment of
business combinations undertaken prior to the transition date were not reconsidered in preparing
the Groups opening IFRS balance sheet as at January 1, 2004.To the extent that the Groups interest in the net fair value of the identifiable assets,
liabilities and contingent liabilities acquired exceeds the cost of a business combination, the
identification and measurement of the related assets, liabilities and contingent liabilities are
revisited accompanied by a reassessment of the cost of the transaction, and any remaining balance
is immediately recognised in the statement of operations.At the acquisition date, any goodwill is allocated to each of the cash generating units expected to
benefit from the combinations synergies. Following initial recognition, goodwill is stated at
cost less any accumulated impairment losses (see note 1(h)).g)
    
    Intangibles, including research and development (other than goodwill)An intangible asset, which is an identifiable non-monetary asset without physical substance, is
recognised to the extent that it is probable that the expected future economic benefits
attributable to the asset will flow to the Group and that its cost can be measured reliably. The
asset is deemed to be identifiable when it is separable (that is, capable of being divided from the
entity and sold, transferred, licensed, rented or exchanged, either individually or together with a
related contract, asset or liability) or when it arises from contractual or other legal rights,
regardless of whether those rights are transferable or separable from the Group or from other
rights and obligations.Intangible assets acquired as part of a business combination are capitalised separately from
goodwill if the intangible asset meets the definition of an asset and the fair value can be
reliably measured on initial recognition. Subsequent to initial recognition, these intangible
assets are carried at cost less any accumulated amortisation and any accumulated impairment losses
(note 1(h)). Definite lived intangible assets are reviewed for indicators of impairment annually
while indefinite lived assets and those not yet brought into use are tested for impairment
annually, either individually or at the cash generating unit level.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007Research and developmentExpenditure on research activities, undertaken with the prospect of gaining new scientific or
technical knowledge and understanding, is recognised in the statement of operations as an expense
as incurred. Expenditure on development activities, whereby research findings are applied to a
plan or design for the production of new or substantially improved products and processes, is
capitalised if the product or process is technically and commercially feasible and the Group has
sufficient resources to complete the development. The expenditure capitalised includes the cost of
materials, direct labour and attributable overheads and third party costs. Subsequent expenditure
on capitalised intangible assets is capitalised only when it increases the future economic benefits
embodied in the specific asset to which it relates. All other development expenditure is expensed
as incurred. Subsequent to initial recognition, the capitalised development expenditure is carried
at cost less any accumulated amortisation and any accumulated impairment losses (note 1(h)).Expenditure on internally generated goodwill and brands is recognised in the statement of
operations as an expense as incurred.AmortisationAmortisation is charged to the statement of operations on a straight-line basis over the estimated
useful lives of intangible assets, unless such lives are indefinite. Intangible assets are
amortised from the date they are available for use. The estimated useful lives are as follows:
 
    
    Patents and licences
    
    6-15 years
    
    Capitalised development costs
    
    15 years
    
    Other (including acquired customer and supplier lists)
    
    6-15 years
 Certain trade names acquired are deemed to have an indefinite useful life.Where amortisation is charged on assets with finite lives, this expense is taken to the statement
of operations through the selling, general and administrative expenses line.Useful lives are examined on an annual basis and adjustments, where applicable, are made on a
prospective basis.h)
    
    ImpairmentThe carrying amount of the Groups assets, other than inventories and deferred tax assets, are
reviewed at each balance sheet date to determine whether there is any indication of impairment. If
any such indication exists, the assets recoverable amount (being the greater of fair value less
costs to sell and value in use) is assessed at each balance sheet date.Fair value less costs to sell is defined as the amount obtainable from the sale of an asset or
cash-generating unit in an arms length transaction between knowledgeable and willing parties, less
the costs that would be incurred in disposal. Value in use is defined as the present value of the
future cash flows expected to be derived through the continued use of an asset or cash-generating
unit. 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 future cash flow estimates have not yet
been adjusted. The estimates of future cash flows exclude cash inflows or outflows attributable to
financing activities and income tax. For an asset that does not generate largely independent cash
flows, the recoverable amount is determined by reference to the cash generating unit to which the
asset belongs.For goodwill, assets that have an indefinite useful life and intangible assets that are not yet
available for use, the recoverable amount is estimated at each balance sheet date at the cash
generating unit level. The goodwill and indefinite-lived assets were reviewed for impairment at
December 31, 2005, December 31, 2006 and December 2007. See note 12.An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating
unit exceeds its recoverable amount. Impairment losses are recognised in the statement of
operations.Impairment losses recognised in respect of cash-generating units are allocated first to reduce the
carrying amount of any goodwill allocated to cash-generating units and then to reduce the carrying
amount of other assets in the units on a pro-rata basis.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007An impairment loss is reversed only to the extent that the assets carrying amount does not exceed
the carrying amount that would have been determined, net of depreciation or amortisation, if no
impairment loss had been recognised.An impairment loss in respect of goodwill is not reversed.Following recognition of any impairment loss (and on recognition of an impairment loss reversal),
the depreciation or amortisation charge applicable to the asset or cash generating unit is adjusted
prospectively with the objective of systematically allocating the revised carrying amount, net of
any residual value, over the remaining useful life.i)
    
    InventoriesInventories are stated at the lower of cost and net realisable value. Cost is based on the
first-in, first-out principle and includes all expenditure which has been incurred in bringing the
products to their present location and condition, and includes an appropriate allocation of
manufacturing overhead based on the normal level of operating capacity. Net realisable value is
the estimated selling price of inventory on hand in the ordinary course of business less all
further costs to completion and costs expected to be incurred in selling these products.The Group provides for inventory, based on estimates of the expected realisability of the Groups
inventory. The estimated realisability is evaluated on a case-by-case basis and any inventory that
is approaching its use-by date and for which no further re-processing can be performed is written
off. Any reversal of an inventory provision is recognised in the statement of operations in the
year in which the reversal occurs.j)
    
    Trade and other receivablesTrade and other receivables are stated at their amortised cost less impairment losses
incurred. Cost approximates fair value given the short dated nature of these assets.k)
    
    Trade and other payablesTrade and other payables are stated at cost. Cost approximates fair value given the short
dated nature of these liabilities.l)
    
    Cash and cash equivalents
Cash and cash equivalents comprise cash balances and short-term deposits with a maturity of three
months or less. The Group has no short-term bank overdraft facilities. Where restrictions are
imposed by third parties, such as lending institutions, on cash balances held by the Group these
are treated as financial assets in the financial statements.m)
    
    Interest-bearing loans and borrowingsLoans and borrowings, including promissory notesUnder IFRS interest-bearing loans, borrowings and promissory notes are recognised initially at
fair value less attributable transaction costs. Subsequent to initial recognition,
interest-bearing borrowings are stated at amortised cost, with any difference between cost and
redemption value being recognised in the statement of operations over the period of the
borrowings on an effective interest basis.Convertible notesUnder IFRS convertible notes that can be converted into share capital at the option of the holder,
where the number of shares issued does not vary with changes in their fair value, are accounted for
as compound financial instruments. Transaction costs that relate to the issue of a compound
financial instrument are allocated to the liability and equity components in proportion to the
allocation of proceeds. The equity component of the convertible notes is calculated as the excess
of the issue proceeds over the present value of the future interest and principal payments,
discounted at the market rate of interest applicable to similar liabilities that do not have a
conversion option. The interest expense recognised in the statement of operations is calculated
using the effective interest rate method.n)
    
    Share-based paymentsFor equity-settled share-based payments (share options), the Group measures the services received
and the corresponding increase in equity at fair value at the measurement date (which is the
grant date) using a trinomial model. Given that the share options granted do not vest until the
completion of a specified period of service, the fair value, which is assessed at the grant date,
is recognised on the basis that the services to be rendered by employees as consideration for the
granting of share options will be received over the vesting period.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007The share options issued by the Group are not subject to market-based vesting conditions as
defined in IFRS 2, Share-based Payments. Non-market vesting conditions are not taken into
account when estimating the fair value of share options as at the grant date; such conditions are
taken into account through adjusting the number of equity instruments included in the measurement
of the transaction amount so that, ultimately, the amount recognised equates to the number of
equity instruments that actually vest. The expense in the statement of operations in relation to
share options represents the product of the total number of options anticipated to vest and the
fair value of those options; this amount is allocated to accounting periods on a straight-line
basis over the vesting period. Given that the performance conditions underlying the Groups
share options are non-market in nature, the cumulative charge to the statement of operations is
only reversed where the performance condition is not met or where an employee in receipt of share
options relinquishes service prior to completion of the expected vesting period. Share based
payments, to the extent they relate to direct labour involved in development activities, are
capitalised, see 1(g).The proceeds received net of any directly attributable transaction costs are credited to share
capital (nominal value) and share premium when the options are exercised. The Group does not
operate any cash-settled share-based payment schemes or share-based payment transactions with
cash alternatives as defined in IFRS 2.o)
    
    Government grantsGrants that compensate the Group for expenses incurred such as research and development,
employment and training are recognised as revenue or income in the statement of operations on a
systematic basis in the same periods in which the expenses are incurred. Grants that compensate
the Group for the cost of an asset are recognised in the statement of operations as other
operating income on a systematic basis over the useful life of the asset.p)
    
    Revenue recognitionGoods sold and services renderedRevenue from the sale of goods is recognised in the statement of operations when the significant
risks and rewards of ownership have been transferred to the buyer. Revenue from products is
generally recorded as of the date of shipment. Revenue is recognised when the Group has satisfied
all of its obligations to the customer. Revenue, including any amounts invoiced for shipping and
handling costs, represents the value of goods supplied to external customers, net of discounts
and excluding sales taxes.Revenue from services rendered is recognised in the statement of operations in proportion to the
stage of completion of the transaction at the balance sheet date.Revenue is recognised to the extent that it is probable that economic benefit will flow to the
Group, that the risks and rewards of ownership have passed to the buyer and the revenue can be
measured. No revenue is recognised if there is uncertainty regarding recovery of the
consideration due at the outset of the transaction or the possible return of goods.The Group leases instruments under operating and finance leases as part of its business. In cases
where the risks and rewards of ownership of the instrument pass to the customer, the fair value of
the instrument is recognised as revenue at the commencement of the lease and is matched by the
related cost of sale. In the case of operating leases of instruments which typically involve
commitments by the customer to pay a fee per test run on the instruments, revenue is recognised on
the basis of customer usage of the instruments. See also note 1(d).Other operating incomeRental income from sub-leasing premises under operating leases, where the risks and rewards of the
premises remain with the lessor, is recognised in the statement of operations as other operating
income on a straight-line basis over the term of the lease.q)
    
    Employee benefitsDefined contribution plansThe Group operates defined contribution schemes in various locations where its subsidiaries are
based. Contributions to the defined contribution schemes are recognised in the statement of
operations in the period in which the related service is received from the employee.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007Other long-term benefitsWhere employees participate in the Groups other long-term benefit schemes (such as permanent
health insurance schemes under which the scheme insures the employees), or where the Group
contributes to insurance schemes for employees, the Group pays an annual fee to a service provider,
and accordingly the Group expenses such payments as incurred.Termination benefitsTermination benefits are recognised as an expense when the Group is demonstrably committed, without
realistic possibility of withdrawal, to a formal detailed plan to either terminate employment
before normal retirement date, or to provide termination benefits as a result of an offer made to
encourage voluntary redundancy.r)
    
    Foreign currencyA majority of the revenue of the Group is generated in US Dollars. The Groups management has
determined that the US dollar is the primary currency of the economic environment in which the
Company and its subsidiaries (with the exception of the Groups subsidiaries in Germany and Sweden)
principally operate. Thus the functional currency of the Company and its subsidiaries (other than
those subsidiaries in Germany and Sweden) is the US Dollar. The functional currency of the German
and Swedish subsidiaries is the euro and the Swedish Kroner, respectively. The presentation currency
of the Company and Group is the US Dollar. Monetary assets and liabilities denominated in foreign
currencies are translated at the rates of exchange ruling at the balance sheet date. The resulting
gains and losses are included in the statement of operations. Non-monetary assets and liabilities
that are measured in terms of historical cost in a foreign currency are translated using the
exchange rate at the date of the transaction.Results and cash flows of subsidiary undertakings, which have a functional currency other than the
US Dollar, are translated into US Dollars at average exchange rates for the year, and the related
balance sheets have been translated at the rates of exchange ruling on the balance sheet date. Any
exchange differences arising from the translations are recognised in the currency translation
reserve via the statement of recognised income and expense.s)
    
    Derivative financial instrumentsThe activities of the Group expose it primarily to changes in foreign exchange rates and interest
rates. The Group uses derivative financial instruments, when necessary, such as forward foreign
exchange contracts to hedge these exposures.The Group enters into forward contracts to sell US Dollars forward for euro. The principal exchange
risk identified by the Group is with respect to fluctuations in the euro as a substantial portion
of its expenses are denominated in euro but its revenues are primarily denominated in US Dollars.
Trinity Biotech monitors its exposure to foreign currency movements and may use these forward
contracts as cash flow hedging instruments whose objective is to cover a portion of this euro
expense.At the inception of a hedging transaction entailing the use of derivatives, the Group documents the
relationship between the hedged item and the hedging instrument together with its risk management
objective and the strategy underlying the proposed transaction. The Group also documents its
quarterly assessment of the effectiveness of the hedge in offsetting movements in the cash flows of
the hedged items.Derivative financial instruments are recognised at fair value. Where derivatives do not fulfil the
criteria for hedge accounting, they are classified as held-for-trading and changes in fair values
are reported in the statement of operations. The fair value of forward exchange contracts is
calculated by reference to current forward exchange rates for contracts with similar maturity
profiles and equates to the current market price at the balance sheet date.The portion of the gain or loss on a hedging instrument that is deemed to be an effective cash flow
hedge is recognised directly in the hedging reserve in equity and the ineffective portion is
recognised in the statement of operations. As the forward contracts are exercised the net
cumulative gain or loss recognised in the hedging reserve is transferred to the statement of
operations and reflected in the same line as the hedged item.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007t)
    
    Segment reportingA segment is a distinguishable component of the Group that is engaged either in providing products
or services (business segment), or in providing products or services within a particular economic
environment (geographical segment), which is subject to risks and returns different to those of
other segments. Stemming from the Groups internal organisational and management structure and its
system of internal financial reporting, segmentation by geographic location of assets is regarded
as being the predominant source and nature of the risks and returns facing the Group and is thus
the primary segment format under IAS 14, Segment Reporting.Business segmentation is therefore the
secondary segment format.u)
    
    Tax (current and deferred)Income tax on the profit or loss for the year comprises current and deferred tax. Income tax is
recognised in the statement of operations except to the extent that it relates to items recognised
directly in equity, in which case it is recognised in equity.Current tax represents the expected tax payable (or recoverable) on the taxable profit for the year
using tax rates enacted or substantively enacted at the balance sheet date and taking into account
any adjustments stemming from prior years.Deferred tax is provided on the basis of the balance sheet liability method on all temporary
differences at the balance sheet date which is defined as the difference between the tax bases of
assets and liabilities and their carrying amounts in the financial statements. Deferred tax assets
and liabilities are not subject to discounting and are measured at the tax rates that are
anticipated to apply in the period in which the asset is realised or the liability is settled based
on tax rates and tax laws that have been enacted or substantively enacted at the balance sheet
date. The amount of deferred tax provided is based on the expected manner of realisation or
settlement of the carrying amount of assets and liabilities.Deferred tax assets and liabilities are recognised for all temporary differences (that is,
differences between the carrying amount of the asset or liability and its tax base) with the
exception of the following:
 i.
    
    Where the deferred tax liability arises from goodwill not deductible for tax purposes
or the initial recognition of an asset or a liability in a transaction that is not a
business combination and affects neither the accounting profit nor the taxable profit or
loss at the time of the transaction; andii.
    
    Where, in respect of temporary differences associated with investments in subsidiary
undertakings, the timing of the reversal of the temporary difference is subject to control
and it is probable that the temporary difference will not reverse in the foreseeable
future.
 Where goodwill is tax deductible, a deferred tax liability is not recognised on initial recognition
of goodwill. It is recognised subsequently for the taxable temporary difference which arises when
the goodwill is amortised for tax with no corresponding adjustment to the carrying value of the
goodwill.The carrying amounts of deferred tax assets are subject to review at each balance sheet date and
are derecognised to the extent that future taxable profits are considered to be inadequate to allow
all or part of any deferred tax asset to be utilised.v)
    
    ProvisionsA provision is recognised in the balance sheet when the Group has a present legal or constructive
obligation as a result of a past event, and it is probable that an outflow of economic benefits
will be required to settle the obligation.w)
    
    Cost of salesCost of sales comprises product cost including manufacturing and payroll costs, quality control,
shipping, handling, and packaging costs and the cost of services provided.x)
    
    Finance income and costsFinancing expenses comprise costs payable on leases, loans and borrowings including promissory
notes. Interest payable on loans and borrowings, promissory notes and convertible notes is
calculated using the effective interest rate method. Interest payable on finance leases is
allocated to each period during the lease term so as to produce a constant periodic rate of
interest on the remaining balance of the liability. Financing expenses also includes the financing
element of long term liabilities which have been discounted.Finance income comprises interest income on deposits and is recognised in the statement of
operations as it accrues, using the effective interest method.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007y)
    
    Warrant reserveThe Group calculates the fair value of warrants at the date of issue taking the amount directly to
equity. The fair value is calculated using a recognised valuation methodology for the valuation of
financial instruments (that is, the trinomial model). The fair value which is assessed at the
grant date is calculated on the basis of the contractual term of the warrants.z)
    
    New IFRS Standards and Interpretations not appliedThe IASB and IFRIC have issued additional standards and interpretations which are effective for
periods starting after January 1, 2007, some of which have not yet been adopted by the EU. The
following standards and interpretations have yet to be adopted by the Group:
 Effective dateInternational Financial Reporting Standards (IFRS/IAS)IFRS 3
    
    (Revised) Business Combinations
    
    July 1, 2009 (adopted bythe EU)IFRS 8
    
    Operating Segments
    
    January 1, 2009 (adopted bythe EU)IAS 1
(amendment)
    
    Presentation of Financial Statements
    
    January 1, 2009 (not adopted by the EU)IAS 23
(amendment)
    
    Borrowing Costs
    
    January 1, 2009 (not adopted by
the EU)IAS 27
    
    Consolidated and Separate Financial Statements
    
    July 1, 2009 (not adopted by
the EU)IAS 32/ IAS 1
(amendment)
    
    Puttable Instruments and Obligations arising
on Liquidation
    
    January 1, 2009 (not adopted bythe EU)IFRS Share- based Payments
    
    Vesting Conditions and Cancellations
    
    January 1, 2009 (not adopted by
the EU)International Financial Reporting Interpretations Committee (IFRIC)IFRIC 11
    
    Group and Treasury Share Transactions
    
    January 1, 2008 (adopted by the
EU)IFRIC 12
    
    Service Concession Arrangements
    
    January 1, 2008 (not adopted by
the EU)IFRIC 13
    
    Customer Loyalty Programmes
    
    January 1, 2009 (not adopted by
the EU)IFRIC 14
    
    The Limit on a Defined Benefit Asset, Minimum Funding Requirements and
their Interaction
    
    January 1, 2008 (not adopted by
the EU)
 The Group does not anticipate that the adoption of these standards and interpretations will have a
material effect on its financial statements on initial adoption. Upon adoption of IFRS 8 and IAS 1,
the Group may be required to disclose additional information on its operating segments but this
will have no effect on reported income or net assets.2.
    
    SEGMENT INFORMATIONSegment information is presented in respect of the Groups geographical and business segments. The
primary format, geographical segments, is based on the Groups management and internal reporting
structure. Sales of product between companies in the Group are made on commercial terms which
reflect the nature of the relationship between the relevant companies. Segment results, assets and
liabilities include items directly attributable to a segment as well as those that can be allocated
on a reasonable basis. Unallocated items comprise interest-bearing loans, borrowings and expenses
and corporate expenses. Segment capital expenditure is the total cost during the period to acquire
segment plant, property and equipment and intangible assets that are expected to be used for more
than one period, whether acquired on acquisition of a business combination or through acquisitions
as part of the current operations.Geographical segmentsThe Group comprises two main geographical segments (i) the Americas and (ii) Rest of World. The
Groups geographical segments are determined by the location of the Groups assets and operations.The Group has also presented a geographical analysis of the segmental data for Ireland on the basis
of the aggregation thresholds contained in IAS 14.
  71




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007Business segmentsThe Group operates in one business segment, the market for diagnostic tests for a range of diseases
and other medical conditions. In determining the nature of its segmentation, the Group has
considered the nature of the products, their risks and rewards, the nature of the production base,
the customer base and the nature of the regulatory environment. The Group acquires, manufactures
and markets a range of diagnostic products. The Groups products are sold to a similar customer
base and the main body whose regulation the Groups products must comply with is the Food and Drug
Administration (FDA) in the US.The following presents revenue and profit information and certain asset and liability information
regarding the Groups geographical segments.a)
    
    The distribution of revenue by geographical area based on location of assets was as
follows:Revenue
 Rest of WorldAmericas
    
    
    Ireland
    
    
    Other
    
    
    Eliminations
    
    
    TotalYear ended December 31, 2007
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Revenue from external customers
    
    
    37,095
    
    
    
    64,210
    
    
    
    42,312
    
    
    
    
    
    
    
    143,617Inter-segment revenue
    
    
    24,815
    
    
    
    27,196
    
    
    
    10,134
    
    
    
    (62,145
    )
    
    
    Total revenue
    
    
    61,910
    
    
    
    91,406
    
    
    
    52,446
    
    
    
    (62,145
    )
    
    
    143,617
 Rest of WorldAmericas
    
    
    Ireland
    
    
    Other
    
    
    Eliminations
    
    
    TotalYear ended December 31, 2006
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Revenue from external customers
    
    
    33,247
    
    
    
    55,665
    
    
    
    29,762
    
    
    
    
    
    
    
    118,674Inter-segment revenue
    
    
    21,161
    
    
    
    24,968
    
    
    
    9,679
    
    
    
    (55,808
    )
    
    
    Total revenue
    
    
    54,408
    
    
    
    80,633
    
    
    
    39,441
    
    
    
    (55,808
    )
    
    
    118,674
 Rest of WorldAmericas
    
    
    Ireland
    
    
    Other
    
    
    Eliminations
    
    
    TotalYear ended December 31, 2005
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Revenue from external customers
    
    
    31,136
    
    
    
    54,859
    
    
    
    12,565
    
    
    
    
    
    
    
    98,560Inter-segment revenue
    
    
    22,197
    
    
    
    14,402
    
    
    
    6,594
    
    
    
    (43,193
    )
    
    
    Total revenue
    
    
    53,333
    
    
    
    69,261
    
    
    
    19,159
    
    
    
    (43,193
    )
    
    
    98,560
 b)
    
    The distribution of revenue by customers geographical area was as follows:Revenue
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Americas
    
    
    68,481
    
    
    
    60,748
    
    
    
    50,627Europe (including Ireland) *
    
    
    43,631
    
    
    
    34,452
    
    
    
    25,301Asia / Africa
    
    
    31,505
    
    
    
    23,474
    
    
    
    22,632143,617
    
    
    
    118,674
    
    
    
    98,560
 *
    
    Revenue for customers in Ireland is not disclosed separately due to the immateriality of these revenues.  72




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007c)
    
    The distribution of revenue by major product group was as follows:Revenue
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Infectious diseases
    
    
    41,293
    
    
    
    42,051
    
    
    
    44,078Haemostasis
    
    
    60,759
    
    
    
    46,476
    
    
    
    29,766Point of care
    
    
    24,504
    
    
    
    15,279
    
    
    
    12,836Clinical chemistry
    
    
    17,061
    
    
    
    14,868
    
    
    
    11,880143,617
    
    
    
    118,674
    
    
    
    98,560
 d)
    
    The distribution of segment results by geographical area was as follows:
 Rest of WorldAmericas
    
    
    Ireland
    
    
    Other
    
    
    TotalYear ended December 31, 2007
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Result before goodwill
impairment and restructuring
expenses
    
    
    15
    
    
    
    10,868
    
    
    
    447
    
    
    
    11,330Goodwill impairment (note 3)
    
    
    
    
    
    
    (19,156
    )
    
    
    
    
    
    
    (19,156
    )Restructuring expenses (note 3)
    
    
    (6,215
    )
    
    
    (11,961
    )
    
    
    (2,615
    )
    
    
    (20,791
    )Result after goodwill
impairment and restructuring
    
    
    (6,200
    )
    
    
    (20,249
    )
    
    
    (2,168
    )
    
    
    (28,617
    )Unallocated expenses *
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (755
    )Operating loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (29,372
    )Net financing costs (note 4)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,691
    )Loss before tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (32,063
    )Income tax expense (note 9)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,309
    )Loss for the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (35,372
    )
 Rest of WorldAmericas
    
    
    Ireland
    
    
    Other
    
    
    TotalYear ended December 31, 2006
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Result
    
    
    (6,621
    )
    
    
    10,790
    
    
    
    (1,843
    )
    
    
    2,326Unallocated expenses *
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (385
    )Operating profit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,941Net financing costs (note 4)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,489
    )Profit before tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    452Income tax credit (note 9)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,824Profit for the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,276
 Rest of WorldAmericas
    
    
    Ireland
    
    
    Other
    
    
    TotalYear ended December 31, 2005
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Result
    
    
    (369
    )
    
    
    10,339
    
    
    
    (1,581
    )
    
    
    8,389Unallocated expenses *
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,767
    )Operating profit
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    6,622Net financing costs (note 4)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (669
    )Profit before tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,953Income tax expense (note 9)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (673
    )Profit for the year
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,280
 *
    
    Unallocated expenses represent head office general and administration costs of the Group which
cannot be allocated to the results of any specific geographical area.  73




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007e)
    
    The distribution of segment assets and segment liabilities by geographical area was as
follows:
 Rest of WorldAmericas
    
    
    Ireland
    
    
    Other
    
    
    TotalAs at December 31, 2007
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Assets and liabilitiesSegment assets before goodwill impairment and
restructuring
    
    
    61,551
    
    
    
    154,285
    
    
    
    24,090
    
    
    
    239,926Goodwill impairment (note 3)
    
    
    
    
    
    
    (19,156
    )
    
    
    
    
    
    
    (19,156
    )Impact of restructuring
    
    
    (5,469
    )
    
    
    (10,626
    )
    
    
    (2,115
    )
    
    
    (18,210
    )Segment assets after goodwill impairment and
restructuring
    
    
    56,082
    
    
    
    124,503
    
    
    
    21,975
    
    
    
    202,560Unallocated assets:Income tax assets (current and deferred)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,719Cash and cash equivalents
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,700Total assets as reported in the Group balance sheet
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    215,979Segment liabilities before restructuring
    
    
    5,885
    
    
    
    15,387
    
    
    
    4,390
    
    
    
    25,662Impact of restructuring (note 23)
    
    
    808
    
    
    
    691
    
    
    
    517
    
    
    
    2,016Segment liabilities after restructuring
    
    
    6,693
    
    
    
    16,078
    
    
    
    4,907
    
    
    
    27,678Unallocated liabilities:Income tax liabilities (current and deferred)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,323Interest-bearing
loans and borrowings (current andnon-current)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    42,133Total liabilities as reported in the Group balance
sheet
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    79,134
 Rest of WorldAmericas
    
    
    Ireland
    
    
    Other
    
    
    TotalAs at December 31, 2006
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Assets and liabilitiesSegment assets
    
    
    57,162
    
    
    
    145,473
    
    
    
    20,151
    
    
    
    222,786Unallocated assets:Income tax assets (current and deferred)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8,024Restricted cash
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    15,500Cash and cash equivalents
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,821Total assets as reported in the Group balance sheet
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    249,131Segment liabilities
    
    
    6,268
    
    
    
    17,130
    
    
    
    3,687
    
    
    
    27,085Unallocated liabilities:Income tax liabilities (current and deferred)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,490Interest-bearing loans and borrowings and convertible notes (current and non-current)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    45,294Total liabilities as reported in the Group balance
sheet
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    81,869
  74




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007f)
    
    The distribution of long-lived assets, which are property, plant and equipment, goodwill and
intangible assets and other non-current assets (excluding deferred tax assets), by
geographical area was as follows:
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Rest of World  Ireland
    
    
    95,675
    
    
    
    110,936Rest of World  Other
    
    
    10,029
    
    
    
    8,537Americas
    
    
    26,529
    
    
    
    25,065132,233
    
    
    
    144,538
 g)
    
    The distribution of depreciation and amortisation by geographical area was as follows:
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Depreciation:Rest of World  Ireland
    
    
    1,450
    
    
    
    1,336
    
    
    
    1,118Rest of World  Other
    
    
    1,537
    
    
    
    1,163
    
    
    
    427Americas
    
    
    1,354
    
    
    
    1,237
    
    
    
    8894,341
    
    
    
    3,736
    
    
    
    2,434Amortisation:Rest of World  Ireland
    
    
    2,971
    
    
    
    2,298
    
    
    
    1,569Rest of World  Other
    
    
    151
    
    
    
    104
    
    
    
    87Americas
    
    
    296
    
    
    
    285
    
    
    
    1473,418
    
    
    
    2,687
    
    
    
    1,803
 h)
    
    The distribution of share-based payment expense by geographical area was as follows:
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Rest of World  Ireland
    
    
    1,146
    
    
    
    922
    
    
    
    1,174Rest of World  Other
    
    
    37
    
    
    
    24
    
    
    
    22Americas
    
    
    220
    
    
    
    195
    
    
    
    1721,403
    
    
    
    1,141
    
    
    
    1,368
 See note 20 for further information on share-based payments.i)
    
    The distribution of the goodwill impairment and restructuring expenses (see note 3) by
geographical area was as follows:
 December 31, 2007US$000Impairment:Rest of World  Ireland
    
    
    19,156Rest of World  Other
    
    
    Americas
    
    
    19,156Restructuring expenses:Rest of World  Ireland
    
    
    11,961Rest of World  Other
    
    
    6,215Americas
    
    
    2,61520,791
  75




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007The total restructuring expenses above of US$20,791,000 includes an inventory write off of
US$11,772,000. In 2007, as part of the restructuring plan (see note 3), Trinity Biotech undertook
to reduce the number of products and instruments within the two key product lines of Haemostasis
and Infectious Diseases. As a result, the Group has recognised US$11,772,000 for inventory written
off relating to those Haemostasis and Infectious Diseases products and instruments being
rationalised for the year ended December 31, 2007. The write off was included as part of the total
restructuring expenses in cost of sales in the 2007 statement of operations. The distribution of
the inventory write off by geographical area was as follows:
 December 31, 2007US$000Inventory write offRest of World  Ireland
    
    
    4,146Rest of World  Other
    
    
    2,279Americas
    
    
    5,34711,772
 In 2006, the Group undertook to write off inventory of US$5.8 million. Following the acquisition
of the haemostasis business of bioMerieux Inc (bioMerieux), Trinity Biotech sought to combine
the range of products acquired with the Groups existing product range. As part of this process
it was decided to discontinue various existing products and this resulted in a US$5.8 million
write-off of inventory. This write-off was disclosed as a separate line item in cost of sales in
the 2006 statement of operations. The distribution of the inventory provision recognised in 2006
by geographical area was as follows:
 December 31, 2006US$000Inventory provisionRest of World  Ireland
    
    
    1,751Rest of World  Other
    
    
    2,362Americas
    
    
    1,6875,800
 j)
    
    The distribution of interest expense by geographical area was as follows:
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Rest of World  Ireland
    
    
    2,595
    
    
    
    1,982
    
    
    
    894Rest of World  Other
    
    
    15
    
    
    
    12
    
    
    
    8Americas
    
    
    538
    
    
    
    659
    
    
    
    1563,148
    
    
    
    2,653
    
    
    
    1,058
 k)
    
    The distribution of taxation (expense)/ credit by geographical area was as follows:
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Rest of World  Ireland
    
    
    531
    
    
    
    (1,156
    )
    
    
    (1,105
    )Rest of World  Other
    
    
    (662
    )
    
    
    975
    
    
    
    236Americas
    
    
    (3,178
    )
    
    
    3,005
    
    
    
    196(3,309
    )
    
    
    2,824
    
    
    
    (673
    )
 l)
    
    During 2007, 2006 and 2005 there were no customers with 10% or more of total revenues.
  76




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007m)
    
    The distribution of capital expenditure, including expenditure on non-current assets in
business combinations, by geographical area was as follows:
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Rest of World  Ireland
    
    
    14,742
    
    
    
    38,716Rest of World  Other
    
    
    3,130
    
    
    
    4,471Americas
    
    
    3,199
    
    
    
    2,78921,071
    
    
    
    45,976
 3.
    
    RESTRUCTURING EXPENSES AND IMPAIRMENTIn December 2007, the Board of Directors of Trinity Biotech announced a restructuring of the
business. This restructuring included the following elements:
 
    
    the rationalisation of the Haemostasis and Infectious Diseases reagent and
instrumentation product lines;
    
    the reorganisation of the US sales force;
    
    the closure of the Groups operation in Sweden;
    
    the streamlining of the Groups development activities and,
    
    a redundancy programme to reduce headcount across the Group.
 The impact of this restructuring resulted in an after tax charge to the statement of operations of
US$19,207,000 for the year ended December 31, 2007.In addition, in accordance with the provisions of IAS 36 Impairment of Assets, the Group also
recognised an impairment provision of US$19,156,000 against goodwill (see note 12).The impact of the above items on the statement of operations for the year ended December 31, 2007
is as follows:
 Restructuring
    
    
    Impairment
    
    
    TotalUS$000
    
    
    US$000
    
    
    US$000Cost of salesInventory provision
    
    (a) (c)
    
    
    11,772
    
    
    
    
    
    
    
    11,772Termination payments
    
    (c) (d)
    
    
    953
    
    
    
    
    
    
    
    95312,725
    
    
    
    
    
    
    
    12,725Research & developmentWrite-off of capitalised development
and license costs
    
    (b)
    
    
    6,667
    
    
    
    
    
    
    
    6,667Termination payments
    
    (c) (d)
    
    
    240
    
    
    
    
    
    
    
    2406,907
    
    
    
    
    
    
    
    6,907Selling, general & administration expensesImpairment of goodwill (note 12)
    
    
    
    
    
    
    
    
    19,156
    
    
    
    19,156Termination payments
    
    (c) (d)
    
    
    842
    
    
    
    
    
    
    
    842Lease obligation provision
    
    (c)
    
    
    116
    
    
    
    
    
    
    
    116Other
    
    
    
    
    201
    
    
    
    
    
    
    
    2011,159
    
    
    
    19,156
    
    
    
    20,315Total inventory write off, restructuring
expenses and goodwill impairment before
tax
    
    
    
    
    20,791
    
    
    
    19,156
    
    
    
    39,947Income tax impact of inventory write off,
restructuring expenses and goodwill
impairment (note 9)
    
    
    
    
    (1,584
    )
    
    
    
    
    
    
    (1,584
    )Total inventory write off, restructuring
expenses and goodwill impairment after
tax
    
    
    
    
    19,207
    
    
    
    19,156
    
    
    
    38,363
  77




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007The total future claim on cash of the restructuring activities for the year ended December 31,
2007 amounted to US$2,218,000. This cash outflow primarily relates to US$2,035,000 payable in
connection with the termination payments. The non cash element of the restructuring expenses
amounted to US$18,573,000 and the goodwill impairment of US$19,156,000 also has no cash impact.(a)
    
    Under the restructuring plan, Trinity Biotech undertook to reduce the number of products and
instruments within the two key product lines of Haemostasis and Infectious Diseases. The
purpose of the rationalisation was to reduce complexity in the business, to improve selling
and operating efficiencies and to eliminate low revenue generating products. As a result, the
Group has recognised US$11,772,000, including US$147,000 in respect of the closure of the
Swedish operation (see note (c)), for inventory written off relating to those Haemostasis and
Infectious Diseases products and instruments being rationalised for the year ended December
31, 2007.(b)
    
    The Group has made a decision to terminate or suspend a number of product development
projects, which resulted in a write-off of capitalised development and license costs for the
year ended December 31, 2007 of US$6,667,000.Under IFRS the Group writes off research and development expenditure as incurred, with the
exception of expenditure on projects whose outcome has been assessed with reasonable certainty as
to technical feasibility, commercial viability and recovery of costs through future revenues. Such
expenditure is capitalised at cost within intangible assets as development costs. Factors which
impact our judgement to capitalise certain research and development expenditure include the degree
of regulatory approval for products and the results of any market research to determine the likely
future commercial success of products being developed. We review these factors each year to
determine whether our previous estimates as to feasibility, viability and recovery should be
changed.In December 2007, the Group announced its decision to focus on a smaller number of R&D projects,
with a particular focus on projects which will make the greatest contribution to the strategic
growth and development of the Group. Consequently, it was decided to terminate or suspend a number
of projects. As a result, US$5,134,000 of development costs were written off for the year ended
December 31, 2007. The write off of capitalised developments costs in 2007 relates to a number of
specific projects, the two most significant being the HIV over-the-counter (OTC) product and the
development of the HIV Western Blot confirmatory test which accounts for US$2,772,000 of the total
amount of capitalised development costs written off of US$5,134,000. The decision to suspend the
HIV OTC project is based on the latest assessment of expected market size for this product. The
Groups market assessment, carried out in 2007, has indicated that the market opportunity for this
product is significantly less than was originally envisaged. The Groups decision to suspend the
development of its HIV Western Blot confirmatory test is also due to changes in the marketplace.
The remaining development projects, which account for US$2,631,000 of the total capitalised development costs
being written off in 2007 have resulted from the strategic decision made by the Group in 2007 to
focus on a smaller number of R&D projects.Based on the decision to suspend a number of projects, US$439,000 was also written off for license
costs which were capitalised in prior years. These license costs related to projects which have
been written off in the current period.A further of US$1,094,000 was written off technology intangible assets acquired from bioMerieux.
This represents the portion of such assets which relate to instruments and reagents which are
being culled as part of the restructuring (see note 12).(c)
    
    As part of the restructuring, Trinity Biotech decided to close its manufacturing facility
located in Umea, Sweden. This facility manufactures a portion of the Groups Haemostasis
products and was acquired as part of the Biopool AB acquisition in 2001. These products will
be transferred to Trinitys Irish and US facilities in 2008. As part of the closure of this
facility, the Group recognised an inventory write off of US$147,000 and a write down of
property, plant and equipment of US$42,000. A total of US$448,000 has been accrued at
December 31, 2007 which consists of termination payments of US$332,000, and lease obligations
of US$116,000.(d)
    
    The reduction in the number of products, the more focused R&D approach and the closure of
the Swedish operation have enabled the Group to reduce its workforce and consequently total
redundancy costs of US$1,470,000 have been accrued for at December 31, 2007 (see note 23).
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 20074.
    
    FINANCIAL INCOME AND EXPENSES
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005Note
    
    US$000
    
    
    US$000
    
    
    US$000Financial income:Interest income
    
    
    
    
    457
    
    
    
    1,164
    
    
    
    389Financial expense:Finance lease interest
    
    
    
    
    (65
    )
    
    
    (27
    )
    
    
    (33
    )Interest payable on
interest bearing loans
and borrowings
    
    21
    
    
    (2,834
    )
    
    
    (2,167
    )
    
    
    (312
    )Convertible note interest
    
    22
    
    
    
    
    
    
    (278
    )
    
    
    (713
    )Other interest expense
    
    
    
    
    (249
    )
    
    
    (181
    )
    
    
    (3,148
    )
    
    
    (2,653
    )
    
    
    (1,058
    )(2,691
    )
    
    
    (1,489
    )
    
    
    (669
    )
 Other interest expense recognised in 2007 and 2006 comprises an interest expense arising from the
discounting of the deferred consideration payable to bioMerieux, resulting from the acquisition of
the haemostasis business during 2006, to reflect the present value of this additional
consideration, see note 24.5.
    
    OTHER OPERATING INCOME
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Rental income from premises
    
    
    233
    
    
    
    204
    
    
    
    161Employment/ training grants
    
    
    180
    
    
    
    71
    
    
    
    413
    
    
    
    275
    
    
    
    161
 6.
    
    (LOSS)/PROFIT BEFORE TAXThe following amounts were charged/ (credited) to the statement of operations:
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Directors emoluments
(including non- executive
directors):Remuneration
    
    
    2,370
    
    
    
    2,213
    
    
    
    1,752Pension
    
    
    147
    
    
    
    119
    
    
    
    131Share based payments
    
    
    920
    
    
    
    732
    
    
    
    828Auditors remunerationAudit fees
    
    
    1,544
    
    
    
    629
    
    
    
    688Non audit fees
    
    
    77
    
    
    
    50
    
    
    
    164Depreciation  leased assets
    
    
    260
    
    
    
    120
    
    
    
    92Depreciation  owned assets
    
    
    4,081
    
    
    
    3,616
    
    
    
    2,342Amortisation
    
    
    3,418
    
    
    
    2,687
    
    
    
    1,803Loss/ (profit) on the disposal
of property, plant and
equipment
    
    
    16
    
    
    
    (2
    )
    
    
    469Net foreign exchange differences
    
    
    68
    
    
    
    (240
    )
    
    
    (295
    )Operating lease rentals:Plant and machinery
    
    
    38
    
    
    
    85
    
    
    
    17Land and buildings
    
    
    3,798
    
    
    
    2,838
    
    
    
    1,800Other equipment
    
    
    407
    
    
    
    240
    
    
    
    125
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 20077.
    
    PERSONNEL EXPENSES
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Wages and salaries
    
    
    48,385
    
    
    
    42,113
    
    
    
    35,595Social welfare costs
    
    
    5,118
    
    
    
    4,407
    
    
    
    3,613Pension costs
    
    
    1,388
    
    
    
    987
    
    
    
    761Share-based payments
    
    
    1,403
    
    
    
    1,141
    
    
    
    1,36856,294
    
    
    
    48,648
    
    
    
    41,337
 Personnel expenses are shown net of capitalisations. Total personnel expenses (wages and salaries,
social welfare costs and pension costs), inclusive of amounts capitalised, for the year ended
December 31, 2007 amounted to US$60,502,000 (2006: US$49,647,000) (2005: US$42,088,000). Total
share based payments, inclusive of amounts capitalised in the balance sheet, amounted to
US$1,482,000 for the year ended December 31, 2007 (2006: US$1,262,000) (2005: US$1,368,000).
See note 20.Included in personnel expenses for the year ended December 31, 2007 is US$2,035,000 which relates
to termination payments resulting from the restructuring announced in December 2007 (see note 3).The average number of persons employed by the Group in the financial year was 802 (2006: 794)
(2005: 703) and is analysed into the following categories:
 December 31,
    
    
    December 31,
    
    
    December 31,2007
    
    
    2006
    
    
    2005Research and development
    
    
    51
    
    
    
    44
    
    
    
    42Administration and sales
    
    
    268
    
    
    
    246
    
    
    
    207Manufacturing and quality
    
    
    483
    
    
    
    504
    
    
    
    454802
    
    
    
    794
    
    
    
    703
 8.
    
    PENSION SCHEMEThe Group operates defined contribution pension schemes for certain of its full time employees. The
benefits under these schemes are financed by both Group and employee contributions. Total
contributions made by the Group in the financial year and charged against income amounted to
US$1,388,000 (2006: US$987,000) (2005: US$761,000) (note 7). This represents the total cost paid
and due by the Group to the pension schemes for the financial year and as such it was not necessary
to accrue or prepay pension contributions at the year end.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 20079.
    
    INCOME TAX EXPENSE / (CREDIT)
 (a)
    
    The charge for tax based on the profit comprises:
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Current tax expenseCorporation tax at 12.5%
    
    
    60
    
    
    
    519
    
    
    
    361Manufacturing relief
    
    
    
    
    
    
    (49
    )
    
    
    60
    
    
    
    470
    
    
    
    361Overseas tax *
    
    
    114
    
    
    
    25
    
    
    
    (172
    )Adjustment in respect of prior years **
    
    
    (67
    )
    
    
    (290
    )
    
    
    Total current tax expense
    
    
    107
    
    
    
    205
    
    
    
    189Deferred tax expense / (credit) ***Origination and reversal of temporary
differences (see note 13)
    
    
    (1,042
    )
    
    
    (107
    )
    
    
    926Origination and reversal of net
operating losses (see note 13)
    
    
    4,244
    
    
    
    (2,922
    )
    
    
    (442
    )Total deferred tax expense / (credit)
    
    
    3,202
    
    
    
    (3,029
    )
    
    
    484Total income tax charge / (credit) in
the statement ofoperations ****
    
    
    3,309
    
    
    
    (2,824
    )
    
    
    673
 *
    
    The overseas tax charge in 2007 relates primarily to US State Taxes. The overseas tax charge in
2006 relates primarily to US State Taxes. The credit in 2005 of US$172,000 relates primarily to a
current year trading loss in Sweden which the Group was able to offset against its deferred
corporation tax liabilities in Sweden from previous years. No similar credits arose in 2007 or
2006.**
    
    The credit in 2007 principally arises in respect of the finalisation of a claim for Irish
Research and Development Tax Credits (R&D tax credits) in respect of the year ended December 31,
2006. The credit in 2006 of US$290,000 relates primarily to the release of US$200,000 that had
been provided at
December 31, 2005 which was not considered to be required at December 31, 2006. The remaining
US$90,000 principally arises in respect of the finalisation of a claim for R&D tax credits in
respect of the year ended December 31, 2005.***
    
    In 2007 there was a deferred tax credit of US$538,000 (2006: US$741,000 expense) recognised in
respect of Ireland. In 2007, there was a deferred tax expense of US$3,740,000 (2006: US$3,770,000
credit) recognised in respect of overseas tax jurisdictions.****
    
    The income tax charge in 2007 includes a tax credit of US$1,584,000 relating to the
restructuring (see note 3). It also includes a tax expense of US$3,780,000 relating to the
derecognition of deferred tax assets previously recognised, which primarily arose on tax losses
carried forward in the Groups US operations. The derecognition of these deferred tax assets was
considered appropriate in light of the increased tax losses caused by the restructuring and
uncertainty over the timing of the utilisation of the tax losses. December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005Effective tax rate
    
    US$000
    
    
    US$000
    
    
    US$000(Loss)/ profit before taxation
    
    
    (32,063
    )
    
    
    452
    
    
    
    5,953As a percentage of (loss)/ profit before tax:Current tax
    
    
    (0.34
    %)
    
    
    46.32
    %
    
    
    3.17
    %Total (current and deferred)
    
    
    (10.32
    %)
    
    
    (625.44
    )%
    
    
    11.31
    %
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007The following table reconciles the applicable Republic of Ireland statutory tax rate to the
effective total tax rate for the Group:
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005Irish corporation tax
    
    
    12.50
    %
    
    
    12.50
    %
    
    
    12.50
    %Manufacturing relief
    
    
    
    
    
    
    (10.76
    %)
    
    
    Adjustments in respect of prior years
    
    
    0.21
    %
    
    
    (64.15
    %)
    
    
    Effect of tax rates on overseas earnings
    
    
    5.08
    %
    
    
    (529.98
    %)
    
    
    (5.10
    %)Effect of non deductible expenses
    
    
    (8.24
    %)
    
    
    43.90
    %
    
    
    3.91
    %Effect of current year net operating
losses and temporary differences for
which no deferred tax asset was
recognised
    
    
    (9.00
    %)
    
    
    
    
    
    
    Effect of derecognition of deferred tax
assets relating to loss carryforwards
and temporary differences at the start
of the period
    
    
    (11.79
    %)
    
    
    
    
    
    
    Effect of benefit of loss carryforwards
    
    
    
    
    
    
    (25.18
    %)
    
    
    Effect of
Irish income taxable at higher tax rate
    
    
    (0.13
    %)
    
    
    2.44
    %
    
    
    R&D tax credit
    
    
    1.05
    %
    
    
    (54.21
    %)
    
    
    Effective tax rate
    
    
    (10.32
    %)
    
    
    (625.44
    %)
    
    
    11.31
    %
 Deferred tax recognised directly in equity
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Relating to forward
contracts as hedged
instruments
    
    
    23
    
    
    
    4
    
    
    
    4123
    
    
    
    4
    
    
    
    41
 (b)
    
    The distribution of profit before taxes by geographical area was as follows:
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000Rest of World  Ireland
    
    
    (23,143
    )
    
    
    9,585
    
    
    
    7,873Rest of World  Other
    
    
    (2,182
    )
    
    
    (1,855
    )
    
    
    (1,567
    )Americas
    
    
    (6,738
    )
    
    
    (7,278
    )
    
    
    (353
    )(32,063
    )
    
    
    452
    
    
    
    5,953
 (c)
    
    At December 31, 2007, the Group had unutilised net operating losses as follows:
 December 31, 2007
    
    
    December 31, 2006
    
    
    December 31, 2005US$000
    
    
    US$000
    
    
    US$000US
    
    
    9,158
    
    
    
    8,138
    
    
    
    3,331France
    
    
    1,085
    
    
    
    264
    
    
    
    Germany
    
    
    3,540
    
    
    
    2,320
    
    
    
    668Ireland
    
    
    290
    
    
    
    290
    
    
    
    UK
    
    
    160
    
    
    
    580
    
    
    
    24414,233
    
    
    
    11,592
    
    
    
    4,243
 The utilisation of these net operating loss carryforwards is limited to future profitable
operations in the US, France, Germany, Ireland and the UK. The US net operating loss has a maximum
carryforward of 20 years. US$3,043,000 of the net operating losses in the US will expire by
December 31, 2024, US$5,095,000 will expire by December 31, 2026, and US$1,020,000 will expire by
December 31, 2027. The French, German, Irish and UK losses can be carried forward indefinitely.At December 31, 2007, the Group recognised a deferred tax asset of US$203,000 in respect of net
operating loss carryforwards in Germany, UK and France, as there are sufficient taxable temporary
differences relating to the same taxation authority and the same taxable entity which will result
in taxable amounts against which the unused tax losses can be utilised before they expire. The
utilisation of these net operating loss carryforwards is limited to future profitable operations in
Germany, UK and France.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007At December 31, 2007, the Group had unrecognised deferred tax assets in respect of unused tax
losses, unused tax credits and deductible temporary differences as follows:
 December
    
    
    December
    
    
    December
    
    
    December31,2007
    
    
    31,2006
    
    
    31,2005
    
    
    31,2004US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000US  unused tax losses
    
    
    3,717
    
    
    
    
    
    
    
    Germany  unused tax losses
    
    
    945
    
    
    
    
    
    
    
    France  unused tax losses
    
    
    290
    
    
    
    87
    
    
    
    Ireland  unused tax losses
    
    
    73
    
    
    
    
    
    
    
    US  unused tax credits
    
    
    314
    
    
    
    185
    
    
    
    316
    
    
    
    302US  deductible temporary differences
    
    
    1,600Unrecognised Deferred Tax Asset
    
    
    6,939
    
    
    
    272
    
    
    
    316
    
    
    
    302
 A deferred tax asset of US$3,717,000 (2006: US$Nil) in respect of net operating losses in the US,
US$945,000 (2006: US$Nil) in respect of net operating losses in Germany, US$290,000 (2006:
US$87,000) in respect of net operating losses in France and US$73,000 (2006: US$Nil) in respect of
net operating losses in Ireland were not recognised at December 31, 2007 due to uncertainties
regarding full utilisation of these losses in the related tax jurisdiction in future periods (see
note 13). The Group has US state credit carryforwards of US$314,000 at December 31, 2007 (2006:
US$326,000). A deferred tax asset of US$314,000 (2006: US$185,000) in respect of US state credit
carryforwards was not recognised in 2007 due to uncertainties regarding future full utilisation of
these state credit carryforwards in the related tax jurisdiction in future periods. Excepting
state credit carryforwards of US$11,000 which expire by December 31, 2008 and US$5,000 which expire
by December 31, 2009, the balance of the state credits carry forward indefinitely.
 (d)
    
    There are no income tax consequences for the Company attaching to the payment of dividends by
Trinity Biotech plc to shareholders of the Company.
 10.
    
    (LOSS)/ EARNINGS PER SHAREBasic (loss)/ earnings per ordinary shareBasic (loss)/ earnings per ordinary share for the Group is computed by dividing the loss after
taxation of US$35,372,000 (2006: profit after tax of US$3,276,000) (2005: profit after tax of
US$5,280,000) for the financial year by the weighted average number of A ordinary and B
ordinary shares in issue of 76,036,579 (2006: 70,693,753) (2005: 58,890,084). 1,400,000 of the
total weighted average shares used as the EPS denominator relate to the 700,000 B ordinary
shares in issue. In all respects these shares are treated the same as A ordinary shares except
for the fact that they have two voting rights per share, rights to participate in any liquidation
or sale of the Group and to receive dividends as if each Class B ordinary share were two Class
A ordinary shares. Hence the (loss)/ earnings per share for a B ordinary share is exactly
twice the (loss)/ earnings per share of an A ordinary share.
 December 31,
    
    
    December 31,
    
    
    December 31,2007
    
    
    2006
    
    
    2005A ordinary shares
    
    
    74,636,579
    
    
    
    69,293,753
    
    
    
    57,490,084B ordinary shares
    
    
    1,400,000
    
    
    
    1,400,000
    
    
    
    1,400,000Basic (loss)/ earnings per share denominator
    
    
    76,036,579
    
    
    
    70,693,753
    
    
    
    58,890,084Reconciliation to weighted average earnings per
share denominator:Number of A ordinary shares at January 1 (note 19)
    
    
    73,601,497
    
    
    
    60,041,521
    
    
    
    54,904,318Number of B ordinary shares at January 1
(multiplied by 2)
    
    
    1,400,000
    
    
    
    1,400,000
    
    
    
    1,400,000Weighted average number of shares issued during
the year
    
    
    1,035,082
    
    
    
    9,252,232
    
    
    
    2,585,766Basic (loss)/ earnings per share denominator
    
    
    76,036,579
    
    
    
    70,693,753
    
    
    
    58,890,084
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007The weighted average number of shares issued during the year is calculated by taking the number of
shares issued by the number of days in the year each share is in issue divided by 365 days.Diluted (loss)/ earnings per ordinary shareDiluted (loss)/ earnings per ordinary share is computed by dividing the loss after tax of
US$35,372,000 (2006: profit after tax of US$3,276,000) (2005: profit after tax of US$5,280,000)
for the financial year, adjusted for the after tax effect of the interest saving on convertible
notes of US$nil (2006: US$nil) (2005: US$535,000) by the diluted weighted average number of
ordinary shares in issue of 76,036,579 (2006: 72,125,740) (2005: 67,032,382).The basic weighted average number of shares for the Group may be reconciled to the number used in
the diluted (loss)/ earnings per ordinary share calculation as follows:
 December 31,
    
    
    December 31,
    
    
    December 31,2007
    
    
    2006
    
    
    2005Basic (loss)/ earnings per share denominator
(see above)
    
    
    76,036,579
    
    
    
    70,693,753
    
    
    
    58,890,084Issuable on exercise of options and warrants
    
    
    
    
    
    
    1,431,987
    
    
    
    2,168,545Issuable on conversion of convertible notes
    
    
    
    
    
    
    
    
    
    
    5,973,753Diluted (loss)/ earnings per share denominator *
    
    
    76,036,579
    
    
    
    72,125,740
    
    
    
    67,032,382
 *
    
    At December 31, 2007, the number of shares issuable on the exercise of options and warrants is
anti-dilutive and hence the diluted (loss)/ earnings per share has been calculated excluding the
number of shares issuable on the exercise of options and warrants. If the number of shares
issuable on the exercise of options and warrants had not been anti-dilutive, 1,854,825 shares
issuable on the exercise of options and warrants would have been included in the diluted (loss)/
earnings per share denominator in 2007. The after tax effect of the interest saving on convertible
notes is nil in 2007 as the final interest payment on the convertibles notes was paid on January
2, 2007. The after tax effect of the interest saving on convertible notes for 2006 was anti-dilutive and
hence the diluted earnings per share has been calculated excluding the after tax effect of the
interest saving on the convertible notes of US$208,000 in 2006. If the after tax effect on
interest saving on convertible notes had not been anti-dilutive, 2,209,506 shares issuable on the
conversion of convertible notes would have been included in the diluted earnings per share
denominator in 2006.The after tax effect of the interest saving on convertible notes for 2005 was not anti-dilutive
and therefore 2,168,545 shares issuable on the exercise of options and 5,973,753 shares issuable
on the conversion of convertible notes have been included in the diluted earnings per share
denominator for 2005.Earnings per ADSIn June 2005, Trinity Biotech adjusted its ADS ratio from 1 ADS: 1 Ordinary Share to 1 ADS: 4
Ordinary Shares. Earnings per ADS for all periods presented have been restated to reflect this
exchange ratio.Basic (loss)/ earnings per ADS for the Group is computed by dividing the loss after taxation of
US$35,372,000 (2006: profit after tax of US$3,276,000) (2005: profit after tax of US$5,280,000)
for the financial year by the weighted average number of ADS in issue of 19,009,144 (2006:
17,673,438) (2005:14,722,521).
 December 31,
    
    
    December 31,
    
    
    December 31,2007
    
    
    2006
    
    
    2005A ordinary shares  ADS
    
    
    18,659,144
    
    
    
    17,323,438
    
    
    
    14,372,521B ordinary shares  ADS
    
    
    350,000
    
    
    
    350,000
    
    
    
    350,000Basic (loss)/ earnings per share denominator
    
    
    19,009,144
    
    
    
    17,673,438
    
    
    
    14,722,521
 Diluted (loss)/ earnings per ADS for the Group is computed by dividing the loss after taxation of
US$35,372,000 (2006: profit after tax of US$3,276,000) (2005: profit after tax of US$5,280,000)
for the financial year, adjusted for the after tax effect of interest saving on convertible notes
of US$nil (2006: US$nil) (2005: US$535,000) by the diluted weighted average number of ADS in
issue of 19,009,144 (2006: 18,031,435) (2005: 16,758,095).
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007The basic weighted average number of ADS shares for the Group only may be reconciled to the number
used in the diluted earnings per ADS share calculation as follows:
 December 31,
    
    
    December 31,
    
    
    December 31,2007
    
    
    2006
    
    
    2005Basic (loss)/ earnings per share denominator
(see above)
    
    
    19,009,144
    
    
    
    17,673,438
    
    
    
    14,722,521Issuable on exercise of options and warrants
    
    
    
    
    
    
    357,997
    
    
    
    542,136Issuable on conversion of convertible notes
    
    
    
    
    
    
    
    
    
    
    1,493,438Diluted (loss)/ earnings per share denominator *
    
    
    19,009,144
    
    
    
    18,031,435
    
    
    
    16,758,095
 *
    
    At December 31, 2007, the number of ADSs issuable on the exercise of options and warrants is
anti-dilutive and hence the diluted (loss)/ earnings per share has been calculated excluding the
number of ADSs issuable on the exercise of options and warrants. If the number of ADSs issuable on
the exercise of options and warrants had not been anti-dilutive, 463,706 ADSs issuable on the
exercise of options and warrants would have been included in the diluted (loss)/ earnings per ADS
denominator in 2007. The after tax effect of the interest saving on convertible notes is nil in 2007 as the final
interest payment on the convertibles notes was paid on January 2, 2007. The after tax effect of
the interest saving on convertible notes for 2006 was anti-dilutive and hence the diluted earnings
per ADS share has been stated excluding the after tax effect of the interest saving on the
convertible notes of US$208,000 in 2006. If the after tax effect on interest saving on convertible
notes had not been anti-dilutive, 552,377 ADSs issuable on the conversion of convertible notes
would have been included in the diluted earnings per ADS denominator in 2006. The after tax effect
of the interest saving on convertible notes for 2005 was not anti-dilutive and therefore 542,136
ADSs issuable on the exercise of options and 1,493,438 ADSs issuable on the conversion of
convertible notes have been included in the diluted earnings per ADS denominator for 2005.
  85




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  DECEMBER 31, 2007
 11.
    
    PROPERTY, PLANT AND EQUIPMENT
 Computers,Freehold land
    
    
    Leasehold
    
    
    fixtures and
    
    
    Plant andand buildings
    
    
    improvements
    
    
    fittings
    
    
    equipment
    
    
    TotalUS$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000CostAt January 1, 2006
    
    
    5,064
    
    
    
    3,025
    
    
    
    3,975
    
    
    
    17,198
    
    
    
    29,262Acquisitions through
business combinations
(note 27)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,418
    
    
    
    2,418Other additions
    
    
    18
    
    
    
    370
    
    
    
    1,023
    
    
    
    2,935
    
    
    
    4,346Disposals / retirements
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (629
    )
    
    
    (629
    )Exchange adjustments
    
    
    357
    
    
    
    12
    
    
    
    24
    
    
    
    526
    
    
    
    919At December 31, 2006
    
    
    5,439
    
    
    
    3,407
    
    
    
    5,022
    
    
    
    22,448
    
    
    
    36,316At January 1, 2007
    
    
    5,439
    
    
    
    3,407
    
    
    
    5,022
    
    
    
    22,448
    
    
    
    36,316Acquisitions through
business combinations
(note 27)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    23
    
    
    
    23Other additions
    
    
    15
    
    
    
    266
    
    
    
    549
    
    
    
    7,856
    
    
    
    8,686Disposals / retirements
    
    
    
    
    
    
    
    
    
    
    (52
    )
    
    
    (1,107
    )
    
    
    (1,159
    )Exchange adjustments
    
    
    382
    
    
    
    2
    
    
    
    9
    
    
    
    446
    
    
    
    839At December 31, 2007
    
    
    5,836
    
    
    
    3,675
    
    
    
    5,528
    
    
    
    29,666
    
    
    
    44,705Accumulated depreciationAt January 1, 2006
    
    
    (682
    )
    
    
    (987
    )
    
    
    (1,987
    )
    
    
    (6,404
    )
    
    
    (10,060
    )Charge for the year
    
    
    (112
    )
    
    
    (318
    )
    
    
    (609
    )
    
    
    (2,697
    )
    
    
    (3,736
    )Disposals / retirements
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    120
    
    
    
    120Exchange adjustments
    
    
    (24
    )
    
    
    (12
    )
    
    
    (18
    )
    
    
    (331
    )
    
    
    (385
    )At December 31, 2006
    
    
    (818
    )
    
    
    (1,317
    )
    
    
    (2,614
    )
    
    
    (9,312
    )
    
    
    (14,061
    )At January 1, 2007
    
    
    (818
    )
    
    
    (1,317
    )
    
    
    (2,614
    )
    
    
    (9,312
    )
    
    
    (14,061
    )Charge for the year
    
    
    (119
    )
    
    
    (347
    )
    
    
    (799
    )
    
    
    (3,076
    )
    
    
    (4,341
    )Disposals / retirements
    
    
    
    
    
    
    
    
    
    
    52
    
    
    
    430
    
    
    
    482Restructuring write off
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (133
    )
    
    
    (133
    )Exchange adjustments
    
    
    (33
    )
    
    
    (2
    )
    
    
    (1
    )
    
    
    (207
    )
    
    
    (243
    )At December 31, 2007
    
    
    (970
    )
    
    
    (1,666
    )
    
    
    (3,362
    )
    
    
    (12,298
    )
    
    
    (18,296
    )Carrying amountsAt December 31, 2007
    
    
    4,866
    
    
    
    2,009
    
    
    
    2,166
    
    
    
    17,368
    
    
    
    26,409At December 31, 2006
    
    
    4,621
    
    
    
    2,090
    
    
    
    2,408
    
    
    
    13,136
    
    
    
    22,255
  Assets held under operating leases (where the Company is the lessor)
 
   86




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##### Table of Contents



NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  DECEMBER 31, 2007
 Assets held under finance leases
  Freehold
    
    
    
    
    
    
    Computers,land and
    
    
    Leasehold
    
    
    fixtures and
    
    
    Plant andbuildings
    
    
    improvements
    
    
    fittings
    
    
    equipment
    
    
    TotalAt December 31, 2007
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Depreciation charge
    
    
    
    
    
    
    43
    
    
    
    46
    
    
    
    171
    
    
    
    260Carrying valueAt December 31, 2007
    
    
    
    
    
    
    244
    
    
    
    382
    
    
    
    2,287
    
    
    
    2,913
 Freehold
    
    
    
    
    
    
    Computers,land and
    
    
    Leasehold
    
    
    fixtures and
    
    
    Plant andbuildings
    
    
    improvements
    
    
    fittings
    
    
    equipment
    
    
    TotalAt December 31, 2006
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Depreciation charge
    
    
    
    
    
    
    39
    
    
    
    46
    
    
    
    35
    
    
    
    120Carrying valueAt December 31, 2006
    
    
    
    
    
    
    271
    
    
    
    185
    
    
    
    198
    
    
    
    654
 Property, plant and equipment under construction
   87




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##### Table of Contents



NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  DECEMBER 31, 2007
 12.
    
    GOODWILL AND INTANGIBLE ASSETS
 Development
    
    
    Patents andGoodwill
    
    
    costs
    
    
    licences
    
    
    Other
    
    
    TotalUS$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000CostAt January 1, 2006
    
    
    54,938
    
    
    
    12,317
    
    
    
    5,143
    
    
    
    16,992
    
    
    
    89,390Acquisitions, through business
combinations (note 27)
    
    
    21,679
    
    
    
    
    
    
    
    4,950
    
    
    
    6,435
    
    
    
    33,064Other additions
    
    
    
    
    
    
    5,862
    
    
    
    
    
    
    
    286
    
    
    
    6,148Exchange adjustments
    
    
    
    
    
    
    61
    
    
    
    
    
    
    
    6
    
    
    
    67At December 31, 2006
    
    
    76,617
    
    
    
    18,240
    
    
    
    10,093
    
    
    
    23,719
    
    
    
    128,669At January 1, 2007
    
    
    76,617
    
    
    
    18,240
    
    
    
    10,093
    
    
    
    23,719
    
    
    
    128,669Acquisitions, through business
combinations (note 27)
    
    
    2,982
    
    
    
    
    
    
    
    
    
    
    
    1,500
    
    
    
    4,482Other additions
    
    
    
    
    
    
    7,508
    
    
    
    
    
    
    
    372
    
    
    
    7,880Exchange adjustments
    
    
    
    
    
    
    64
    
    
    
    
    
    
    
    11
    
    
    
    75At December 31, 2007
    
    
    79,599
    
    
    
    25,812
    
    
    
    10,093
    
    
    
    25,602
    
    
    
    141,106Accumulated amortisationAt January 1, 2006
    
    
    
    
    
    
    (464
    )
    
    
    (1,512
    )
    
    
    (2,217
    )
    
    
    (4,193
    )Charge for the year
    
    
    
    
    
    
    (468
    )
    
    
    (611
    )
    
    
    (1,608
    )
    
    
    (2,687
    )Exchange adjustments
    
    
    
    
    
    
    (18
    )
    
    
    
    
    
    
    (3
    )
    
    
    (21
    )At December 31, 2006
    
    
    
    
    
    
    (950
    )
    
    
    (2,123
    )
    
    
    (3,828
    )
    
    
    (6,901
    )At January 1, 2007
    
    
    
    
    
    
    (950
    )
    
    
    (2,123
    )
    
    
    (3,828
    )
    
    
    (6,901
    )Charge for the year
    
    
    
    
    
    
    (547
    )
    
    
    (797
    )
    
    
    (2,074
    )
    
    
    (3,418
    )Goodwill impairment
    
    
    (19,156
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (19,156
    )Restructuring write off (note 3)
    
    
    
    
    
    
    (5,134
    )
    
    
    (1,533
    )
    
    
    
    
    
    
    (6,667
    )Exchange adjustments
    
    
    
    
    
    
    (31
    )
    
    
    
    
    
    
    (5
    )
    
    
    (36
    )At December 31, 2007
    
    
    (19,156
    )
    
    
    (6,662
    )
    
    
    (4,453
    )
    
    
    (5,907
    )
    
    
    (36,178
    )Carrying amountsAt December 31, 2007
    
    
    60,443
    
    
    
    19,150
    
    
    
    5,640
    
    
    
    19,695
    
    
    
    104,928At December 31, 2006
    
    
    76,617
    
    
    
    17,290
    
    
    
    7,970
    
    
    
    19,891
    
    
    
    121,768
     December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Fitzgerald trade name
    
    
    970
    
    
    
    970RDI trade name
    
    
    560
    
    
    
    560Primus trade name
    
    
    1,870
    
    
    
    1,8703,400
    
    
    
    3,400
  88




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##### Table of Contents



NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  DECEMBER 31, 2007
  Impairment testing for intangibles including goodwill and indefinite lived assets
   December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Trinity Biotech Manufacturing Limited
    
    
    20,042
    
    
    
    39,156Benen Trading Limited
    
    
    14,121
    
    
    
    12,086Primus Corporation
    
    
    9,558
    
    
    
    9,558Biopool US Inc
    
    
    5,821
    
    
    
    5,821MarDx Diagnostics Inc
    
    
    3,571
    
    
    
    3,571Trinity Biotech UK (Sales) Limited
    
    
    4,233
    
    
    
    3,328Clark Laboratories Inc
    
    
    2,994
    
    
    
    2,994Trinity Biotech GmbH
    
    
    1,830
    
    
    
    1,830Trinity Biotech France SARL
    
    
    1,673
    
    
    
    1,67363,843
    
    
    
    80,017
  Impairment loss arising on annual impairment review
  December 31, 2007US$000Bartels
    
    
    7,340Cambridge
    
    
    3,005Ortho
    
    
    783Dade
    
    
    8,02819,156
   89




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##### Table of Contents



NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  DECEMBER 31, 2007
 Impairment loss on bioMerieux technology asset
   
    
    An increase in goodwill impairment of US$23.5 million in the event of a 10% decrease in
the growth in revenues.
    
    A decrease in goodwill impairment of US$18.6 million in the event of a 10% increase in
the growth in revenues.
  
    
    An increase in goodwill impairment of US$18.0 million in the event of a 10% increase in
the discount rate.
    
    A decrease in goodwill impairment of US$16.3 million in the event of a 10% decrease in
the discount rate.
  13.
    
    DEFERRED TAX ASSETS AND LIABILITIES
 Recognised deferred tax assets and liabilities
  Assets
    
    
    Liabilities
    
    
    Net2007
    
    
    2006
    
    
    2007
    
    
    2006
    
    
    2007
    
    
    2006US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Property, plant and equipment
    
    
    15
    
    
    
    29
    
    
    
    (1,618
    )
    
    
    (1,752
    )
    
    
    (1,603
    )
    
    
    (1,723
    )Intangible assets
    
    
    
    
    
    
    
    
    
    
    (6,998
    )
    
    
    (6,285
    )
    
    
    (6,998
    )
    
    
    (6,285
    )Inventories
    
    
    1,733
    
    
    
    1,886
    
    
    
    
    
    
    
    
    
    
    
    1,733
    
    
    
    1,886Provisions
    
    
    1,520
    
    
    
    1,055
    
    
    
    
    
    
    
    
    
    
    
    1,520
    
    
    
    1,055Other items
    
    
    466
    
    
    
    239
    
    
    
    (621
    )
    
    
    (1,409
    )
    
    
    (155
    )
    
    
    (1,170
    )Tax value of loss carryforwards
recognised
    
    
    203
    
    
    
    4,447
    
    
    
    
    
    
    
    
    
    
    
    203
    
    
    
    4,447Deferred tax assets/(liabilities)
    
    
    3,937
    
    
    
    7,656
    
    
    
    (9,237
    )
    
    
    (9,446
    )
    
    
    (5,300
    )
    
    
    (1,790
    )
   90




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##### Table of Contents



NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  DECEMBER 31, 2007
      Unrecognised deferred tax assets
  December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Deductible temporary differences
    
    
    3,944
    
    
    
    Capital losses
    
    
    6,138
    
    
    
    6,138US state credit carryforwards
    
    
    314
    
    
    
    185Net operating losses
    
    
    13,560
    
    
    
    26423,956
    
    
    
    6,587
      91




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##### Table of Contents



NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  DECEMBER 31, 2007
   Unrecognised deferred tax liabilities
  Movement in temporary differences during the year
 Balance
    
    
    
    
    
    
    
    
    
    
    
    BalanceJanuary 1,
    
    
    Recognised in
    
    
    Recognised on
    
    
    Recognised
    
    
    December 31,2007
    
    
    income
    
    
    acquisitions
    
    
    in equity
    
    
    2007US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Property, plant and equipment
    
    
    (1,723
    )
    
    
    120
    
    
    
    
    
    
    
    
    
    
    
    (1,603
    )Intangible assets
    
    
    (6,285
    )
    
    
    (428
    )
    
    
    (285
    )
    
    
    
    
    
    
    (6,998
    )Inventories
    
    
    1,886
    
    
    
    (153
    )
    
    
    
    
    
    
    
    
    
    
    1,733Provisions
    
    
    1,055
    
    
    
    465
    
    
    
    
    
    
    
    
    
    
    
    1,520Other items
    
    
    (1,170
    )
    
    
    1,038
    
    
    
    
    
    
    
    (23
    )
    
    
    (155
    )Tax value of loss
carryforwards recognised
    
    
    4,447
    
    
    
    (4,244
    )
    
    
    
    
    
    
    
    
    
    
    203(1,790
    )
    
    
    (3,202
    )
    
    
    (285
    )
    
    
    (23
    )
    
    
    (5,300
    )
 Balance
    
    
    
    
    
    
    
    
    
    
    
    BalanceJanuary 1,
    
    
    Recognised in
    
    
    Recognised on
    
    
    Recognised
    
    
    December 31,2006
    
    
    income
    
    
    acquisitions
    
    
    in equity
    
    
    2006US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Property, plant and equipment
    
    
    (1,650
    )
    
    
    (73
    )
    
    
    
    
    
    
    
    
    
    
    (1,723
    )Intangible assets
    
    
    (4,492
    )
    
    
    (422
    )
    
    
    (1,371
    )
    
    
    
    
    
    
    (6,285
    )Inventories
    
    
    981
    
    
    
    906
    
    
    
    
    
    
    
    
    
    
    
    1,886Provisions
    
    
    640
    
    
    
    415
    
    
    
    
    
    
    
    
    
    
    
    1,055Other items
    
    
    (455
    )
    
    
    (719
    )
    
    
    
    
    
    
    4
    
    
    
    (1,170
    )Tax value of loss
carryforwards recognised
    
    
    1,525
    
    
    
    2,922
    
    
    
    
    
    
    
    
    
    
    
    4,447(3,451
    )
    
    
    3,029
    
    
    
    (1,371
    )
    
    
    4
    
    
    
    (1,790
    )
 14.
    
    OTHER ASSETS
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Finance lease receivables (see note 16)
    
    
    773
    
    
    
    439Other assets
    
    
    123
    
    
    
    76896
    
    
    
    515
   92




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##### Table of Contents



NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  DECEMBER 31, 2007
 15.
    
    INVENTORIES
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Raw materials and consumables
    
    
    10,849
    
    
    
    10,598Work-in-progress
    
    
    9,243
    
    
    
    10,167Finished goods
    
    
    24,328
    
    
    
    24,80744,420
    
    
    
    45,572
     December 31,
    
    
    December 31,
    
    
    December 31,2007
    
    
    2006
    
    
    2005US$000
    
    US$000
    
    US$000Opening provision at January 1
    
    
    7,284
    
    
    
    3,654
    
    
    
    3,798Charged during the year
    
    
    13,856
    
    
    
    6,280
    
    
    
    823Utilised during the year
    
    
    (2,323
    )
    
    
    (2,511
    )
    
    
    (967
    )Released during the year
    
    
    (583
    )
    
    
    (139
    )
    
    
    Closing provision at December 31
    
    
    18,234
    
    
    
    7,284
    
    
    
    3,654
 16.
    
    TRADE AND OTHER RECEIVABLES
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Trade receivables, net of impairment losses
    
    
    23,104
    
    
    
    28,359Prepayments
    
    
    1,665
    
    
    
    3,492Value added tax
    
    
    108
    
    
    
    422Finance lease receivables
    
    
    388
    
    
    
    268Other receivables
    
    
    418
    
    
    
    13525,683
    
    
    
    32,676
   93




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##### Table of Contents



NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  DECEMBER 31, 2007
 Leases as lessor
 (i) Finance lease commitments  Group as lessor
  December 31, 2007US$000MinimumGross
    
    
    Unearned
    
    
    paymentsinvestment
    
    
    income
    
    
    receivableLess than one year
    
    
    673
    
    
    
    285
    
    
    
    388Between one and five years (note 14)
    
    
    1,448
    
    
    
    675
    
    
    
    7732,121
    
    
    
    960
    
    
    
    1,161
 December 31, 2006US$000MinimumGross
    
    
    Unearned
    
    
    paymentsinvestment
    
    
    income
    
    
    receivableLess than one year
    
    
    429
    
    
    
    161
    
    
    
    268Between one and five years (note 14)
    
    
    887
    
    
    
    448
    
    
    
    4391,316
    
    
    
    609
    
    
    
    707
  (ii) Operating lease commitments  Group as lessor
   December 31, 2007US$000Land andbuildings
    
    
    Instruments
    
    
    TotalLess than one year
    
    
    232
    
    
    
    2,198
    
    
    
    2,430Between one and five years
    
    
    929
    
    
    
    3,566
    
    
    
    4,495More than five years
    
    
    871
    
    
    
    
    
    
    
    8712,032
    
    
    
    5,764
    
    
    
    7,796
 December 31, 2006US$000Land andbuildings
    
    
    Instruments
    
    
    TotalLess than one year
    
    
    171
    
    
    
    948
    
    
    
    1,119Between one and five years
    
    
    684
    
    
    
    1,513
    
    
    
    2,197More than five years
    
    
    812
    
    
    
    
    
    
    
    8121,667
    
    
    
    2,461
    
    
    
    4,128
  94




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##### Table of Contents



NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS  DECEMBER 31, 2007
 17.
    
    FINANCIAL ASSETS
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Restricted cash
    
    
    
    
    
    
    15,500
  18.
    
    CASH AND CASH EQUIVALENTS
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Cash at bank and in hand
    
    
    4,193
    
    
    
    2,579Short-term deposits
    
    
    4,507
    
    
    
    242Cash and cash equivalents in the statements of cash flows
    
    
    8,700
    
    
    
    2,821
   95




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##### Table of Contents



NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2007
  Share
    
    
    Sharecapital
    
    
    capital
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Convertible
    
    
    (AccumulatedA
    
    
    B
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    notes
    
    
    deficit)/ordinary
    
    
    ordinary
    
    
    Share
    
    
    Translation
    
    
    Warrant
    
    
    Owned
    
    
    Hedging
    
    
    equity
    
    
    retainedshares
    
    
    shares
    
    
    premium
    
    
    reserve
    
    
    reserve
    
    
    shares
    
    
    reserves
    
    
    component
    
    
    earnings
    
    
    TotalUS$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Balance at January 1, 2005
    
    
    764
    
    
    
    12
    
    
    
    116,665
    
    
    
    118
    
    
    
    3,803
    
    
    
    (2,373
    )
    
    
    373
    
    
    
    164
    
    
    
    (368
    )
    
    
    119,158Total recognised income and expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,740
    )
    
    
    
    
    
    
    
    
    
    
    (437
    )
    
    
    
    
    
    
    5,280
    
    
    
    3,103Share-based payments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,368
    
    
    
    1,368Options and warrants exercised
    
    
    27
    
    
    
    
    
    
    
    2,464
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,491Class A shares issued on conversion of
convertible notes
    
    
    27
    
    
    
    
    
    
    
    5,439
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,466Share issue expenses
    
    
    
    
    
    
    
    
    
    
    (341
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (341
    )Own shares sold
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,373
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,373Balance at December 31, 2005
    
    
    818
    
    
    
    12
    
    
    
    124,227
    
    
    
    (1,622
    )
    
    
    3,803
    
    
    
    
    
    
    
    (64
    )
    
    
    164
    
    
    
    6,280
    
    
    
    133,618Balance at January 1, 2006
    
    
    818
    
    
    
    12
    
    
    
    124,227
    
    
    
    (1,622
    )
    
    
    3,803
    
    
    
    
    
    
    
    (64
    )
    
    
    164
    
    
    
    6,280
    
    
    
    133,618Total recognised income and expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,347
    
    
    
    
    
    
    
    
    
    
    
    64
    
    
    
    
    
    
    
    3,276
    
    
    
    4,687Share-based payments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,262
    
    
    
    1,262Options exercised
    
    
    2
    
    
    
    
    
    
    
    212
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    214Class A shares issued on conversion of
convertible notes
    
    
    20
    
    
    
    
    
    
    
    3,624
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,644Class A shares issued in private placement
    
    
    126
    
    
    
    
    
    
    
    24,879
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    25,005Share issue expenses
    
    
    
    
    
    
    
    
    
    
    (1,168
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,168
    )Balance at December 31, 2006
    
    
    966
    
    
    
    12
    
    
    
    151,774
    
    
    
    (275
    )
    
    
    3,803
    
    
    
    
    
    
    
    
    
    
    
    164
    
    
    
    10,818
    
    
    
    167,262Balance at January 1, 2007
    
    
    966
    
    
    
    12
    
    
    
    151,774
    
    
    
    (275
    )
    
    
    3,803
    
    
    
    
    
    
    
    
    
    
    
    164
    
    
    
    10,818
    
    
    
    167,262Total recognised income and expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,072
    
    
    
    
    
    
    
    
    
    
    
    201
    
    
    
    
    
    
    
    (35,372
    )
    
    
    (34,099
    )Share-based payments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,482
    
    
    
    1,482Options exercised
    
    
    4
    
    
    
    
    
    
    
    450
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    454Class A shares issued on conversion of
convertible notes
    
    
    9
    
    
    
    
    
    
    
    1,813
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,822Convertible notes  transfer to retained
earnings on maturity
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (164
    )
    
    
    164
    
    
    
    Share issue expenses
    
    
    
    
    
    
    
    
    
    
    (76
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (76
    )Balance at December 31, 2007
    
    
    979
    
    
    
    12
    
    
    
    153,961
    
    
    
    797
    
    
    
    3,803
    
    
    
    
    
    
    
    201
    
    
    
    
    
    
    
    (22,908
    )
    
    
    136,845
  96




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Share capital
 Class A Ordinary shares
    
    
    Class A Ordinary sharesIn thousands of shares
    
    2007
    
    
    2006In issue at January 1
    
    
    73,602
    
    
    
    60,041Issued for cash
    
    
    285
    
    
    
    11,739Issued for non cash (note 22)
    
    
    870
    
    
    
    1,822In issue at December 31
    
    
    74,757
    
    
    
    73,602
 Class B Ordinary shares
    
    
    Class B Ordinary sharesIn thousands of shares
    
    2007
    
    
    2006In issue at January 1
    
    
    700
    
    
    
    700Issued for cash
    
    
    
    
    
    
    In issue at December 31
    
    
    700
    
    
    
    700
 The Group had authorised share capital of 200,000,000 A ordinary shares of US$0.0109 each (2006:
100,000,000 A ordinary shares of US$0.0109 each) and 700,000 B ordinary shares of US$0.0109 each
(2006: 700,000 B ordinary shares of US$0.0109 each) as at December 31, 2007.
 (a)
    
    During 2007, the Group issued 285,216 A Ordinary shares from the exercise of warrants and
employee options for a consideration of US$454,000, settled in cash. A further 870,052 shares
(equivalent to US$1,821,000) were issued on a non cash basis as the Group made its final
convertible debt repayment by way of shares during the year, which resulting in the release of
the carrying amount of the convertible notes liability on the balance sheet (see note 22). In
2007, the Group incurred costs of US$76,000 (2006: US$1,168,000) (2005: US$317,000) in connection
with the issue of shares.(b)
    
    In April 2006, Trinity Biotech completed a US$25,005,000 private placement of 11,593,840 of
Class A Ordinary Shares of the Group. The Group issued a further 145,156 shares from the
exercise of employee options for a consideration of US$214,000. Transactions costs relating to
the private placement and the exercise of employee options amounted to US$1,168,000. 1,821,980
shares (equivalent to US$3,644,000) were issued on a non cash basis as the Group made part of
its convertible debt repayments by way of shares (see note 22).(c)
    
    Since its incorporation the Group has not declared or paid dividends on its A Ordinary
Shares or B Ordinary Shares. The Group anticipates, for the foreseeable future, that it
will retain any future earnings in order to fund its business operations. The Group does
not, therefore, anticipate paying any cash or share dividends on its A Ordinary or B
Ordinary shares in the foreseeable future. As provided in the Articles of Association of the
Company, dividends or other distributions will be declared and paid in US Dollars.(d)
    
    The Class B Ordinary Shares have two votes per share and the rights to participate in any
liquidation or sale of the Group and to receive dividends as if each Class B Ordinary Share
were two Class A Ordinary Shares. In all other respects they rank pari passu with the A
ordinary shares.
 Currency translation reserveThe currency translation reserve comprises all foreign exchange differences arising from the
translation of the financial statements of foreign currency denominated operations of the Group
since January 1, 2004.Warrant reserveThe warrant reserve comprises the equity component of share warrants issued by the Group for the
purpose of fundraising. The Group calculates the fair value of warrants at the date of issue
taking the amount directly to a separate reserve within equity. The fair value is calculated using
the trinomial model. The fair value which is assessed at the grant date is calculated on the basis
of the contractual term of the warrants. In accordance IFRS 2, 1,258,824 warrants with a fair
value of US$3,803,000 (2006: 1,258,824 warrants with a fair value of US$3,803,000) have been classified
as a separate reserve. A further 58,500 warrants were issued by the Group in 2001 and consequently
they do not fall within scope of IFRS 2 and hence have not been fair valued. There were no new
warrants issued by the Group in 2007 or 2006.
  97




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 The following input assumptions were made to fair value the warrants:
 Fair value at date of measurement
    
    
    US$3.02Share price
    
    
    US$4.78Exercise price
    
    
    US$5.25Expected volatility
    
    
    78.31
    %Contractual life
    
    

    5 yearsRisk free rate
    
    
    3.26
    %Expected dividend yield
    
    
    
 Owned sharesIn April 2004, the Group completed the acquisition of the assets of Fitzgerald Industries
International Inc (Fitzgerald) for US$16,000,000 in cash (before contingent consideration and costs).
The acquisition was partly funded by the issue of 2,783,984 A Ordinary Shares of the Group. As
at December 31, 2004, the Group funded the in substance repurchase of 817,470 shares with a value
of US$2,373,000. All of these shares were resold in the market in 2005.
 Hedging reserveThe hedging reserve comprises the effective portion of the cumulative net change in the fair value
of cash flow hedging instruments related to hedged transactions entered into but not yet
crystallised.
 Convertible notes  equity componentUnder IAS 32, the equity and liability elements of the convertible notes are recorded separately,
with the equity component of the convertible notes being calculated as the excess of the issue
proceeds over the present value of the future interest and principal repayments, discounted at the
market rate of interest applicable to similar liabilities that do not have a conversion option.
Transaction costs are allocated to the liability and equity components in proportion to the
allocation of proceeds. On January 2, 2007, the maturity date of the convertible notes, the amount
classified as equity of US$164,000 was reclassified from equity to retained earnings.
 20.
    
    SHARE OPTIONS AND SHARE WARRANTS
 WarrantsThe Company granted warrants to purchase 940,405 Class A Ordinary Shares in the Company to agents
of the Company who were involved in the Companys private placements in 1994 and 1995 and the
debenture issues in 1997, 1999 and 2002. A further warrant to purchase 100,000 Class A Ordinary
Shares was also granted to a consultant of the Company. At December 31, 2007 there were no
warrants outstanding under these awards. In January 2004, the Company completed a private placement
of 5,294,118 Class A Ordinary Shares of the Company at a price of US$4.25 per A Ordinary share.
The investors were granted five year warrants (vesting immediately) to purchase an aggregate of
1,058,824 Class A Ordinary Shares in the Company at an exercise price of US$5.25 per share. The
Company granted further warrants (vesting immediately) to purchase 200,000 Class A Ordinary
Shares in the Company to agents of the Company who were involved in this private placement in
January 2004 at an exercise price of US$5.25. These warrants also have a term of five years. At
December 31, 2007 there were warrants to purchase 1,258,824 A Ordinary shares in the Company
outstanding under this award.
 December 31, 2007
    
    
    December 31, 2006Outstanding at beginning of year
    
    
    1,317,324
    
    
    
    1,317,324Granted
    
    
    
    
    
    
    Exercised
    
    
    (10,000
    )
    
    
    Forfeited
    
    
    (48,500
    )
    
    
    Outstanding at end of year
    
    
    1,258,824
    
    
    
    1,317,324
 OptionsUnder the terms of the Companys Employee Share Option Plan, options to purchase 7,809,295
(excluding warrants of 1,258,824) A Ordinary Shares were outstanding at December 31, 2007. Under
the plan, options are granted to officers, employees and consultants of the Group at the discretion
of the Compensation Committee (designated by the board of directors), under the terms outlined
below.
  98




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 The terms and conditions of the grants are as follows, whereby all options are settled by physical
delivery of shares:
 Vesting conditionsThe options vest following a period of service by the officer or employee. The required period of
service is determined by the Compensation Committee at the date of grant of the options (usually
the date of approval by the Compensation Committee) and it is generally over a four year period.
There are no market conditions associated with the share option grants.
 Contractual lifeThe term of an option will be determined by the Compensation Committee, provided that the term may
not exceed seven years from the date of grant (some of the Groups earlier plans had a ten year
life). All options will terminate 90 days after termination of the option holders employment,
service or consultancy with the Group (or one year after such termination because of death or
disability) except where a longer period is approved by the Board of Directors. Under certain
circumstances involving a change in control of the Group, the Compensation Committee may accelerate
the exercisability and termination of the options up to a maximum of one year.
 The number and weighted average exercise price of share options and warrants per ordinary share is
as follows (as required by IFRS 2, this information relates to all grants of share options and
warrants by the Group):
 Weighted-averageOptions and
    
    
    exercise price
    
    
    Rangewarrants
    
    
    US$
    
    
    US$Outstanding January 1, 2005
    
    
    9,946,341
    
    
    
    2.10
    
    
    
    0.81-5.25Granted
    
    
    1,670,000
    
    
    
    1.69
    
    
    
    1.59-3.00Exercised
    
    
    (2,615,376
    )
    
    
    1.00
    
    
    
    0.81-1.75Forfeited
    
    
    (152,508
    )
    
    
    1.99
    
    
    
    0.98-4.00Outstanding at end of period
    
    
    8,848,457
    
    
    
    2.35
    
    
    
    0.81-5.25Exercisable at end of year
    
    
    4,589,342
    
    
    
    US$2.69
    
    
    
    0.81-5.25Outstanding January 1, 2006
    
    
    8,848,457
    
    
    
    2.35
    
    
    
    0.81-5.25Granted
    
    
    1,617,000
    
    
    
    2.02
    
    
    
    1.35-2.30Exercised
    
    
    (145,155
    )
    
    
    1.47
    
    
    
    0.98-1.75Forfeited
    
    
    (708,235
    )
    
    
    2.15
    
    
    
    0.81-5.00Outstanding at end of period
    
    
    9,612,067
    
    
    
    US$2.32
    
    
    
    0.98-5.25Exercisable at end of year
    
    
    5,605,469
    
    
    
    US$2.50
    
    
    
    0.98-5.25Outstanding January 1, 2007
    
    
    9,612,067
    
    
    
    US$2.32
    
    
    
    0.98-5.25Granted
    
    
    364,667
    
    
    
    2.24
    
    
    
    1.35-2.80Exercised
    
    
    (285,210
    )
    
    
    1.59
    
    
    
    0.98-2.72Forfeited
    
    
    (623,405
    )
    
    
    2.07
    
    
    
    0.98-4.00Outstanding at end of period
    
    
    9,068,119
    
    
    
    US$2.36
    
    
    
    0.98-5.25Exercisable at end of year
    
    
    6,417,223
    
    
    
    US$2.48
    
    
    
    0.98-5.25
 The weighted average share price per A Ordinary share at the date of exercise for options
exercised in 2007 is US$2.59 (2006: US$2.19) (2005: US$2.09).
 The opening share price per A Ordinary share at the start of the financial year was US$2.14 (2006
US$2.04) (2005: US$2.93) and the closing share price at December 31, 2007 was US$1.70 (2006: US$2.14)
(2005: US$2.04). The average share price for the year ended December 31, 2007 was US$2.47.
  99




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 A summary of the range of prices for the Companys stock options and warrants for the year ended
December 31, 2007 follows:
 Outstanding
    
    
    ExercisableWeighted-
    
    
    
    
    
    
    
    
    
    
    Weighted-avg
    
    
    
    
    
    
    
    
    
    
    avgcontractual
    
    
    
    
    
    
    
    
    
    
    contractualWeighted
    
    
    life
    
    
    
    
    
    
    Weighted
    
    
    lifeExercise price
    
    No. of
    
    
    avg exercise
    
    
    remaining
    
    
    No. of
    
    
    avg exercise
    
    
    remainingrange
    
    options
    
    
    price
    
    
    (years)
    
    
    options
    
    
    price
    
    
    (years)US$0.81-US$0.99
    
    
    1,218,834
    
    
    
    US$0.98
    
    
    
    1.44
    
    
    
    1,218,834
    
    
    
    US$0.98
    
    
    
    1.44US$1.00-US$2.05
    
    
    3,033,711
    
    
    
    US$1.60
    
    
    
    3.32
    
    
    
    2,005,868
    
    
    
    US$1.55
    
    
    
    2.48US$2.06-US$2.99
    
    
    3,250,750
    
    
    
    US$2.37
    
    
    
    4.66
    
    
    
    1,660,364
    
    
    
    US$2.49
    
    
    
    3.90US$3.00-US$5.25
    
    
    1,564,824
    
    
    
    US$4.89
    
    
    
    1.37
    
    
    
    1,532,157
    
    
    
    US$4.92
    
    
    
    1.329,068,119
    
    
    
    
    
    
    
    
    
    
    
    6,417,223
 The weighted-average remaining contractual life of options outstanding at December 31, 2007 was
3.21 years (2006: 4.00 years). The information above also includes outstanding warrants.
 A summary of the range of prices for the Companys stock options and warrants for the year ended
December 31, 2006 follows:
 Outstanding
    
    
    ExercisableWeighted-
    
    
    
    
    
    
    
    
    
    
    Weighted-avg
    
    
    
    
    
    
    
    
    
    
    avgcontractual
    
    
    
    
    
    
    
    
    
    
    contractualWeighted
    
    
    life
    
    
    
    
    
    
    Weighted
    
    
    lifeExercise price
    
    No. of
    
    
    avg exercise
    
    
    remaining
    
    
    No. of
    
    
    avg exercise
    
    
    remainingrange
    
    options
    
    
    price
    
    
    (years)
    
    
    options
    
    
    price
    
    
    (years)US$0.81-US$0.99
    
    
    1,233,834
    
    
    
    US$0.98
    
    
    
    2.43
    
    
    
    1,233,834
    
    
    
    US$0.98
    
    
    
    2.43US$1.00-US$2.05
    
    
    3,635,210
    
    
    
    US$1.60
    
    
    
    4.12
    
    
    
    1,868,542
    
    
    
    US$1.52
    
    
    
    2.60US$2.06-US$2.99
    
    
    3,153,366
    
    
    
    US$2.39
    
    
    
    5.29
    
    
    
    1,038,772
    
    
    
    US$2.57
    
    
    
    4.01US$3.00-US$5.25
    
    
    1,589,657
    
    
    
    US$4.87
    
    
    
    2.39
    
    
    
    1,464,321
    
    
    
    US$5.01
    
    
    
    2.239,612,067
    
    
    
    
    
    
    
    
    
    
    
    5,605,469
 The recognition and measurement principles of IFRS 2 have been applied to share options granted
under the Companys share options plans since November 7, 2002 which have not vested by January 1,
2005 in accordance with IFRS 2.
  100




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Charge for the year under IFRS 2
 The charge for the year is calculated based on the fair value of the options granted which have not
yet vested.
 The fair value of the options is expensed over the vesting period of the option. US$1,403,000 was
charged to the statement of operations in 2007, (2006: US$1,141,000) (2005: US$1,368,000) split as
follows:
 December 31,
    
    
    December 31,
    
    
    December 31,2007
    
    
    2006
    
    
    2005US$000
    
    
    US$000
    
    
    US$000Share-based payments  cost of sales
    
    
    71
    
    
    
    89
    
    
    
    110Share-based payments  research and development
    
    
    108
    
    
    
    36
    
    
    
    210Share-based payments  selling, general and administrative
    
    
    1,224
    
    
    
    1,016
    
    
    
    1,048Total
    
    
    1,403
    
    
    
    1,141
    
    
    
    1,368
 The total share based payments charge for the year was US$1,482,000. However, a total of US$79,000
(2006: US$121,000) (2005: US$nil) of research and development share based payments was capitalised in
intangible assets during the year.
 The fair value of services received in return for share options granted are measured by reference
to the fair value of share options granted. The estimate of the fair value of services received is
measured based on a trinomial model. The following are the input assumptions used in determining
the fair value of share options granted in 2007, 2006 and 2005:
 Key
    
    
    
    
    
    
    Key
    
    
    
    
    
    
    Keymanagement
    
    
    Other
    
    
    management
    
    
    Other
    
    
    management
    
    
    Otherpersonnel
    
    
    employees
    
    
    personnel
    
    
    employees
    
    
    personnel
    
    
    employees2007
    
    
    2007
    
    
    2006
    
    
    2006
    
    
    2005
    
    
    2005Weighted average
fair value at
measurement date
    
    
    
    
    
    
    US$0.96
    
    
    
    US$1.17
    
    
    
    US$0.97
    
    
    
    US$0.95
    
    
    
    US$0.75Total share options
granted
    
    
    
    
    
    
    364,667
    
    
    
    860,000
    
    
    
    757,000
    
    
    
    650,000
    
    
    
    1,019,000Weighted average
share price
    
    
    
    
    
    
    US$2.28
    
    
    
    US$2.09
    
    
    
    US$1.95
    
    
    
    US$1.67
    
    
    
    US$1.69Weighted average
exercise price
    
    
    
    
    
    
    US$2.28
    
    
    
    US$2.09
    
    
    
    US$1.95
    
    
    
    US$1.67
    
    
    
    US$1.71Weighted average
expected volatility
    
    
    
    
    
    
    47.41
    %
    
    
    56.11
    %
    
    
    54.88
    %
    
    
    60.3
    %
    
    
    59.72
    %Weighted average
expected life
    
    
    
    
    
    4.18 years
    
    5.73 years
    
    4.47 years
    
    5.33 years
    
    3.28 yearsWeighted average
risk free interest
rate
    
    
    
    
    
    
    4.35
    %
    
    
    4.55
    %
    
    
    4.83
    %
    
    
    4.51
    %
    
    
    4.01
    %Expected dividend
yield
    
    
    
    
    
    
    0
    %
    
    
    0
    %
    
    
    0
    %
    
    
    0
    %
    
    
    0
    %
 No options were granted to the key management during 2007.
 The expected life of the options is based on historical data and is not necessarily indicative of
exercise patterns that may occur. The expected volatility is based on the historic volatility
(calculated based on the expected life of the options). The Group has considered how future
experience may affect historical volatility. The profile and activities of the Group are not
expected to change in the immediate future and therefore Trinity Biotech would expect estimated
volatility to be consistent with historical volatility.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 21.
    
    INTEREST-BEARING LOANS AND BORROWINGS
 This note provides information about the contractual terms of the Groups interest-bearing loans
and borrowings. For more information about the Groups exposure to interest rate and foreign
currency risk, see note 30.
 December 31, 2007
    
    
    December 31, 2006Note
    
    
    US$000
    
    
    US$000Current liabilitiesFinance lease liabilities
    
    
    
    
    
    
    657
    
    
    
    256Bank loans, secured
    
    
    28 (c)- Repayable by instalment
    
    
    
    
    
    
    8,220
    
    
    
    8,157- Repayable not by instalment
    
    
    
    
    
    
    6,944
    
    
    
    1,96915,821
    
    
    
    10,382Non-current liabilitiesFinance lease liabilities
    
    
    
    
    
    
    1,648
    
    
    
    248Bank loans, secured
    
    
    28 (c)- Repayable by instalment
    
    
    
    
    
    
    24,664
    
    
    
    32,82826,312
    
    
    
    33,076
 Bank loansTrinity Biotech has a US$48,340,000 club banking facility with Allied Irish Bank plc and Bank of
Scotland (Ireland) Limited (the banks). The facility consists of a five year US Dollar floating
interest rate term loan of US$41,340,000 and a one year revolver of US$7,000,000. The facility was
amended in October 2007, increasing the revolver loan element of the facility from US$2,000,000 to
US$7,000,000. The term loan is repayable in ten equal biannual instalments which commenced in January
2007. Two principal repayments of US$4,134,000 each were paid in January and July 2007. This facility
is secured on the assets of the Group (see note 28 (c)).Various covenants apply to the Groups bank
borrowings. At December 31, 2007, the total amount outstanding under the facility amounted to
US$39,808,000. The debt is stated net of unamortised funding costs of US$264,000
 Since December, 31 2007, the Group has agreed new covenants with the banks under revised terms and
conditions for the facility. In addition the Group has agreed a revised repayment schedule for the
outstanding debt, which will result in an extension to the repayment period and will reduce the
level of repayments in the 12 months after December 31, 2007 (see note 30).
 Finance lease liabilities
 Finance lease liabilities are payable as follows:
 December 31, 2007US$000Minimumleasepayments
    
    
    Interest
    
    
    PrincipalLess than one year
    
    
    779
    
    
    
    122
    
    
    
    657In more than one year, but not more than two
    
    
    550
    
    
    
    89
    
    
    
    461In more than two years but not more than five
    
    
    1,287
    
    
    
    100
    
    
    
    1,1872,616
    
    
    
    311
    
    
    
    2,305
 December 31, 2006US$000Minimumleasepayments
    
    
    Interest
    
    
    PrincipalLess than one year
    
    
    278
    
    
    
    22
    
    
    
    256In more than one year, but not more than two
    
    
    234
    
    
    
    8
    
    
    
    226In more than two years but not more than five
    
    
    23
    
    
    
    1
    
    
    
    22535
    
    
    
    31
    
    
    
    504
 Under the terms of the lease arrangements, no contingent rents are payable.
  102




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Promissory notesDuring 2006, the Group issued a promissory note for the payment of deferred consideration to
bioMerieux as part of the acquisition of their haemostasis business. However, these notes are
non-interest bearing and are included under Other Financial Liabilities at December 31, 2007 and
December 31, 2006 (see note 24).
 Terms and debt repayment schedule
The terms and conditions of outstanding interest bearing loans and borrowings at December 31, 2007
are as follows:
 Nominal
    
    
    
    
    
    
    Fair
    
    
    Carrying
    
    
    Fair
    
    
    Carryinginterest
    
    
    Year of
    
    
    Value
    
    
    Value
    
    
    Value
    
    
    ValueFacility
    
    Currency
    
    
    rate
    
    
    maturity
    
    
    December 31, 2007
    
    
    December 31, 2006Fixed bank loans
    
    USD
    
    
    5.00
    %
    
    
    2009
    
    
    
    19
    
    
    
    20
    
    
    
    36
    
    
    
    37Floating (LIBOR) bank
loans
    
    USD
    
    
    6.74
    %
    
    
    2009 -2011
    
    
    
    39,808
    
    
    
    39,808
    
    
    
    42,916
    
    
    
    42,917Finance lease liabilities
    
    Euro
    
    
    5.43
    %
    
    
    2007 -2012
    
    
    
    2,153
    
    
    
    2,142
    
    
    
    322
    
    
    
    324Finance lease liabilities
    
    GBP
    
    
    6.82
    %
    
    
    2008 -2010
    
    
    
    145
    
    
    
    163
    
    
    
    179
    
    
    
    180Total interest-bearing
loans and borrowings
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    42,125
    
    
    
    42,133
    
    
    
    43,453
    
    
    
    43,458
 22.
    
    CONVERTIBLE NOTES  INTEREST BEARING
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Convertible notesDue within one year
    
    
    
    
    
    
    1,836Total
    
    
    
    
    
    
    1,836
 At December 31, 2007 the balance outstanding on the convertible notes, resulting from the private
placement of US$20,000,000 in July 2003 and a further US$5,000,000 in January 2004 was US$nil. The final
principal repayment of US$1,822,000 was made by way of shares in January 2007. The final interest
payment of US$14,000 was made in cash on the same date.
 Under IAS 32, the equity and liability elements of the convertible notes were recorded separately,
with the equity component of the convertible notes being calculated as the excess of the issue
proceeds over the present value of the future interest and principal repayments, discounted at the
market rate of interest applicable to similar liabilities that do not have a conversion option.
Transaction costs were allocated to the liability and equity components in proportion to the
allocation of proceeds. The corresponding interest expense recognised in the statement of
operations is calculated using the effective interest rate method. The effective interest rate is
the normal coupon rate of 3% adjusted for the effect of transaction costs and the amount classified
as equity.
 2007
    
    
    2006US$000
    
    
    US$000Proceeds from issue of convertible notes
    
    
    25,000
    
    
    
    25,000Transaction costs
    
    
    (1,307
    )
    
    
    (1,307
    )Net
    
    
    23,693
    
    
    
    23,693Converted to shares
    
    
    (17,355
    )
    
    
    (15,533
    )Cash repayments
    
    
    (7,288
    )
    
    
    (7,288
    )Amount classified as equity
    
    
    (297
    )
    
    
    (297
    )Accreted interest capitalised
    
    
    1,247
    
    
    
    1,261Carrying amount of liability at December 31
    
    
    
    
    
    
    1,836
  103




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 The amount of the convertible notes classified as equity on January 1, 2005 of US$297,000 is net of
attributable transaction costs of US$16,000. Of the US$297,000, US$71,000 has been reclassified from
equity to share capital and share premium following the share conversions in December 2003 and
January 2004. On January 2, 2007, the maturity date of the convertible notes, the amount
classified as equity of US$226,000 was stated net of the related deferred tax asset of US$62,000 and
carried at US$164,000. The net balance of US$164,000 classified as equity at the date of maturity was
reclassified from equity to retained earnings on maturity.
 23.
    
    TRADE AND OTHER PAYABLES
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Trade payables
    
    
    8,454
    
    
    
    7,752Payroll taxes
    
    
    514
    
    
    
    415Employee related social insurance
    
    
    520
    
    
    
    438Accrued restructuring expenses
    
    
    2,016
    
    
    
    Accrued liabilities
    
    
    11,821
    
    
    
    8,983Deferred income
    
    
    1,454
    
    
    
    2,87124,779
    
    
    
    20,459
 Accrued restructuring expensesFollowing the announcement of the restructuring in December 2007 (see note 3), the Group
recognised an accrual of US$2,016,000 for expected restructuring costs. Of the total restructuring
accrual of US$2,016,000, US$1,470,000 related to cost accrued for contract termination costs and
employee termination benefits and includes US$332,000 for termination payments accrued as part of
the closure of the Swedish operation. Estimated costs for termination benefits are based on
agreements between management and individual employees. Estimated costs for contract terminations
are based on the terms of the relevant contracts. US$116,000 relates to a building lease and other
non-redundancy obligations arising from the closure of the Swedish manufacturing operation. In
December 2006, the Group renewed its non-cancellable lease for a manufacturing facility in Umea,
Sweden. Resulting from the planned closure of the Swedish manufacturing operation in 2008, the
Group will cease to use this manufacturing facility from March 2008. The lease on the building
expires in December 2008. The obligation for the future lease payments during the period in which
the building will not be used was been accrued for at December 31, 2007.
 24.
    
    OTHER FINANCIAL LIABILITIES
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000ConsiderationDue within 1 year
    
    
    2,725
    
    
    
    3,120Due greater than 1 year
    
    
    
    
    
    
    2,5682,725
    
    
    
    5,688
 ConsiderationIn June 2006, the Group acquired the haemostasis business of bioMerieux for a cash consideration
of US$38.2 million. In addition bioMerieux was entitled to deferred consideration up to a maximum
of US$6.2 million, payable in June 2007 and up to an additional US$5.3 million, payable in June 2008,
depending on the performance of the business during 2006. At December 31, 2006, it was determined
that the deferred consideration of US$3.2 million and US$2.8 million would be payable in July 2007 and
July 2008 respectively. Deferred consideration of US$3,208,000 was paid in July 2007. In accordance
with the Groups policy these deferred consideration amounts have been discounted to reflect their
fair value at the date of acquisition. At December 31, 2007, the fair value of the deferred
consideration still outstanding amounted to US$2,725,000 (2006: US$5,688,000).
 The Group has issued a promissory note for the payment of the deferred consideration. According to
the terms of this promissory note, there are certain events of default which may cause the deferred
consideration to become payable immediately. In this instance the payment may, at the election of
the holder of the promissory note, be payable in shares in Trinity Biotech, at a price of 90% of
the average trading price for the preceding 20 days. As at December 31, 2007 the Group was not in
default of the terms of the promissory note and hence the deferred consideration has been
classified according to the payment terms as outlined above.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 25.
    
    PROVISIONS
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Provisions
    
    
    100
    
    
    
    100
 Movement on provisions during the year is as follows:
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Balance at January 1
    
    
    100
    
    
    
    199Provisions made during the year
    
    
    
    
    
    
    100Provisions released during the year
    
    
    
    
    
    
    (199
    )Balance at December 31
    
    
    100
    
    
    
    100
 During 2007 the Group experienced no significant product warranty claims. However, the Group
believes that it is appropriate to retain a product warranty provision to cover any future claims.
The provision at December 31, 2007 represents the estimated cost of product warranties, the exact
amount which cannot be determined. US$100,000 represents managements best estimates of these
obligations at December 31, 2007.
 26.
    
    OTHER PAYABLES
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Other payables
    
    
    74
    
    
    
    838
 27.
    
    BUSINESS COMBINATIONS
 2007 AcquisitionsIn September 2007, the Group acquired the immuno technology business of Cortex Biochem Inc
(Cortex) for a total cash consideration of US$2,925,000, consisting of cash consideration of
US$2,887,000 and acquisition expenses of US$38,000.In October 2007, the Group acquired certain components relating to the distribution business of
Sterilab Services UK (Sterilab), a distributor of Infectious Diseases products, for a total of
US$1,489,000, consisting of cash consideration of US$1,480,000 and acquisition expenses of US$9,000.
  105




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 The results for both acquisitions in 2007 are incorporated from the date of acquisition in the
consolidated statement of operations for the year ended December 31, 2007.
 Cortex
    
    
    Sterilab
    
    
    TotalUS$000
    
    
    US$000
    
    
    US$000Property, plant and equipment
    
    
    
    
    
    
    23
    
    
    
    23Inventories
    
    
    41
    
    
    
    88
    
    
    
    129Trade and other receivables
    
    
    152
    
    
    
    
    
    
    
    152Intangible assets
    
    
    844
    
    
    
    656
    
    
    
    1,5001,037
    
    
    
    767
    
    
    
    1,804Deferred tax liability (see note 13)
    
    
    102
    
    
    
    183
    
    
    
    285Trade and other payables
    
    
    45
    
    
    
    
    
    
    
    45147
    
    
    
    183
    
    
    
    330Fair value of net assets
    
    
    890
    
    
    
    584
    
    
    
    1,474Goodwill arising on acquisition
    
    
    2,035
    
    
    
    905
    
    
    
    2,9402,925
    
    
    
    1,489
    
    
    
    4,414Consideration:Cash payments
    
    
    2,887
    
    
    
    1,480
    
    
    
    4,367Costs associated with the acquisition
    
    
    38
    
    
    
    9
    
    
    
    472,925
    
    
    
    1,489
    
    
    
    4,414
 Goodwill capitalised during 2007 in respect of the Cortex and Sterilab acquisitions amounted to
US$2,940,000 and comprised:
 Fair valueBook values
    
    
    adjustments
    
    
    Fair value
    
    
    Consideration
    
    
    GoodwillUS$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000CortexTrade and other receivables
    
    
    152
    
    
    
    
    
    
    
    152Inventories
    
    
    218
    
    
    
    (177
    )
    
    
    41Intangible assets
    
    
    
    
    
    
    844
    
    
    
    844370
    
    
    
    667
    
    
    
    1,037Deferred tax liability
    
    
    
    
    
    
    102
    
    
    
    102Trade and other payables
    
    
    45
    
    
    
    
    
    
    
    45325
    
    
    
    565
    
    
    
    890
    
    
    
    2,925
    
    
    
    2,035SterilabProperty, plant and equipment
    
    
    23
    
    
    
    
    
    
    
    23Inventories
    
    
    99
    
    
    
    (11
    )
    
    
    88Intangible assets
    
    
    
    
    
    
    656
    
    
    
    656122
    
    
    
    645
    
    
    
    767Deferred tax liability
    
    
    
    
    
    
    183
    
    
    
    183Trade and other payables
    
    
    
    
    
    
    
    
    
    
    122
    
    
    
    462
    
    
    
    584
    
    
    
    1,489
    
    
    
    905
 Impact of the acquisition
on the statement of operations and
cashflow
Due to their size, the impact of the acquisition of Cortex and Sterilab does not have a significant
impact on the statement of operations and cashflow in 2007.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 The following represents the increases to goodwill which took place in 2007.
 US$000Goodwill recognised with respect to 2007 acquisitions- Cortex
    
    
    2,035- Sterilab
    
    
    905Goodwill recognised with respect to 2006 acquisitions- bioMerieux
    
    
    42Total goodwill movement in 2007
    
    
    2,982
 2006 AcquisitionsIn June 2006, Trinity Biotech acquired the haemostasis business of bioMerieux Inc. (bioMerieux)
for a total consideration of US$44.4 million, consisting of cash consideration of US$38.2 million,
deferred consideration of US$5.5 million (net of discounting) and acquisition expenses of
US$0.7 million. At December 31, 2006, Trinity Biotech had accrued US$5,688,000 for the deferred
consideration to be paid in June 2007 and June 2008 (see note 24). Deferred consideration of
US$3,208,000 (US$3,120,000 net of discounting) was paid to bioMerieux in June 2008. At December 31,
2007, the Group has accrued deferred consideration US$2,725,000 to be paid in June 2008. A further
US$5.5 million of consideration was contingent on the performance of the product line during 2006.
However, the Group had determined that this contingent element is not payable as certain milestones
concerning the performance of the business line were not met during 2006.
 In October, 2006, Trinity Biotech acquired the French distribution business of Laboratoires
Nephrotek SARL (Nephrotek) for a total consideration of US$1,175,000, consisting of cash
consideration of US$1,060,000 and acquisition expenses of US$115,000.
 The results of these acquisitions for 2006 are incorporated from the date of acquisition in the
consolidated statement of operations for the year ended December 31, 2006. The fair value of the
identifiable assets and liabilities were as follows:
 bioMerieux
    
    
    Nephrotek
    
    
    TotalUS$000
    
    
    US$000
    
    

US$000Property, plant and equipment
    
    
    2,354
    
    
    
    64
    
    
    
    2,418Inventories
    
    
    12,529
    
    
    
    345
    
    
    
    12,874Intangible assets
    
    
    11,150
    
    
    
    235
    
    
    
    11,38526,033
    
    
    
    644
    
    
    
    26,677Deferred tax liability (see note 13)
    
    
    1,293
    
    
    
    77
    
    
    
    1,370Trade and other payables
    
    
    1,319
    
    
    
    69
    
    
    
    1,3882,612
    
    
    
    146
    
    
    
    2,758Fair value of net assets
    
    
    23,421
    
    
    
    498
    
    
    
    23,919Goodwill arising on acquisition
    
    
    21,002
    
    
    
    677
    
    
    
    21,67944,423
    
    
    
    1,175
    
    
    
    45,598Consideration:Cash payments
    
    
    38,157
    
    
    
    821
    
    
    
    38,978Deferred consideration
    
    
    5,511
    
    
    
    239
    
    
    
    5,750Costs associated with the acquisition
    
    
    755
    
    
    
    115
    
    
    
    87044,423
    
    
    
    1,175
    
    
    
    45,598
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Goodwill capitalised during 2006 in respect of the acquired haemostasis business from bioMerieux
and the acquired distribution business from Nephrotek amounted to US$21,679,000 and comprises:
 Fair valueBook values
    
    
    adjustments
    
    
    Fair value
    
    
    Consideration
    
    
    GoodwillUS$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000bioMerieuxProperty, plant and equipment
    
    
    2,659
    
    
    
    (305
    )
    
    
    2,354Inventories
(including prepayments)
    
    
    12,848
    
    
    
    (319
    )
    
    
    12,529Intangible assets
    
    
    
    
    
    
    11,150
    
    
    
    11,15015,507
    
    
    
    10,526
    
    
    
    26,033Deferred tax liability
    
    
    
    
    
    
    1,293
    
    
    
    1,293Trade and other payables
    
    
    1,219
    
    
    
    100
    
    
    
    1,31914,288
    
    
    
    9,133
    
    
    
    23,421
    
    
    
    44,423
    
    
    
    21,002NephrotekProperty, plant and equipment
    
    
    96
    
    
    
    (32
    )
    
    
    64Inventories
    
    
    394
    
    
    
    (49
    )
    
    
    345Intangible assets
    
    
    
    
    
    
    235
    
    
    
    235490
    
    
    
    154
    
    
    
    644Deferred tax liability
    
    
    
    
    
    
    77
    
    
    
    77Trade and other payables
    
    
    40
    
    
    
    29
    
    
    
    69450
    
    
    
    48
    
    
    
    498
    
    
    
    1,175
    
    
    
    677
 During the period, following the acquisition, fair value adjustments were made to recognise
intangible assets acquired in 2006. The inventory acquired under the acquisition of the
haemostasis business of bioMerieux was provided to Trinity Biotech on a phased basis over the 12
month period after the acquisition date. Consequently, at December 31, 2006, the fair valuation
of inventory had been assessed on a provisional basis and the fair value exercise was completed in
2007. The final fair valuation of inventory resulted in a write down during 2007 of inventory
acquired of US$42,000. The fair value of all other assets and liabilities was complete at December
31, 2006.
 Provisional
    
    
    Adjustments
    
    
    Adjustments
    
    
    Finalfair value
    
    
    to net assets
    
    
    to costs
    
    
    fair value2006
    
    
    2007
    
    
    2007
    
    
    2007US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000bioMerieuxIntangible assets
    
    
    11,150
    
    
    
    
    
    
    
    
    
    
    
    11,150Working capital
    
    
    14,883
    
    
    
    (42
    )
    
    
    
    
    
    
    14,84126,033
    
    
    
    (42
    )
    
    
    
    
    
    
    25,991Deferred tax liability
    
    
    1,293
    
    
    
    
    
    
    
    
    
    
    
    1,293Trade and other
payables
    
    
    1,319
    
    
    
    
    
    
    
    
    
    
    
    1,31923,421
    
    
    
    (42
    )
    
    
    
    
    
    
    23,379Consideration and costs
    
    
    44,423
    
    
    
    
    
    
    
    
    
    
    
    42,423
  108




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 2005 Acquisitions
 In March 2005, Trinity Biotech completed the acquisition of the assets of Research Diagnostics Inc
(RDI), a provider of immunodiagnostic products for US$4,200,000 in cash. Acquisition expenses
amounted to US$105,000. In July 2005, Trinity Biotech completed the acquisition of 100% of the
equity in Primus Corporation (Primus), a leader in the field of in-vitro diagnostic testing for
haemoglobin A1c and haemoglobin variants for US$14,503,000 consisting of a cash consideration of
US$8,587,000 and a one year promissory note of US$3,000,000. Acquisition expenses amounted to US$211,000.
Under the terms of the purchase agreement, the shareholders of Primus were also entitled to an
additional consideration based on the growth of the Group during the remainder of 2005. At December
31, 2005, the Group has accrued US$2,705,000 for this additional consideration which was paid in
2006.
 The results of these acquisitions for 2005 are incorporated from the date of acquisition in the
consolidated statement of income for the year ended December 31, 2005. The fair value of the
identifiable assets and liabilities were as follows:
 Primus
    
    
    RDI
    
    
    TotalUS$000
    
    
    US$000
    
    
    US$000Property, plant and equipment
    
    
    2,395
    
    
    
    
    
    
    
    2,395Trade and other receivables
    
    
    1,848
    
    
    
    
    
    
    
    1,848Inventories
    
    
    1,304
    
    
    
    113
    
    
    
    1,417Intangible assets
    
    
    4,615
    
    
    
    1,790
    
    
    
    6,40510,162
    
    
    
    1,903
    
    
    
    12,065Deferred tax liability (see note 12)
    
    
    1,825
    
    
    
    216
    
    
    
    2,041Trade and other payables
    
    
    1,649
    
    
    
    
    
    
    
    1,6493,474
    
    
    
    216
    
    
    
    3,690Fair value of net assets
    
    
    6,688
    
    
    
    1,687
    
    
    
    8,375Goodwill arising on acquisition
    
    
    7,688
    
    
    
    2,618
    
    
    
    10,30614,376
    
    
    
    4,305
    
    
    
    18,681Consideration:Cash payments
    
    
    8,587
    
    
    
    4,200
    
    
    
    12,787Less cash transferred with subsidiary
    
    
    (127
    )
    
    
    
    
    
    
    (127
    )Deferred consideration
    
    
    3,000
    
    
    
    
    
    
    
    3,000Other consideration (see note 23)
    
    
    2,705
    
    
    
    
    
    
    
    2,705Costs associated with the acquisition
    
    
    211
    
    
    
    105
    
    
    
    31614,376
    
    
    
    4,305
    
    
    
    18,681
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Goodwill capitalised during 2005 in respect of acquired businesses amounted to US$10,306,000 and
comprises:
 Fair valueBook values
    
    
    adjustments
    
    
    Fair value
    
    
    Consideration
    
    
    GoodwillUS$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000PrimusProperty, plant and equipment
    
    
    2,371
    
    
    
    24
    
    
    
    2,395Trade and other receivables
    
    
    1,848
    
    
    
    
    
    
    
    1,848Inventories
    
    
    1,858
    
    
    
    (554
    )
    
    
    1,304Intangible assets
    
    
    330
    
    
    
    4,285
    
    
    
    4,6156,407
    
    
    
    3,755
    
    
    
    10,162Deferred tax liability
    
    
    
    
    
    
    1,825
    
    
    
    1,825Trade and other payables
    
    
    1,566
    
    
    
    (33
    )
    
    
    1,533Creditors greater than one year
    
    
    116
    
    
    
    
    
    
    
    1164,725
    
    
    
    1,963
    
    
    
    6,688
    
    
    
    14,376
    
    
    
    7,688RDIProperty, plant and equipment
    
    
    10
    
    
    
    (10
    )
    
    
    Inventories
    
    
    146
    
    
    
    (33
    )
    
    
    113Intangible assets
    
    
    
    
    
    
    1,790
    
    
    
    1,790156
    
    
    
    1,747
    
    
    
    1,903Deferred tax liability
    
    
    
    
    
    
    216
    
    
    
    216156
    
    
    
    1,531
    
    
    
    1,687
    
    
    
    4,305
    
    
    
    2,618
 28.
    
    COMMITMENTS AND CONTINGENCIES
 (a)
    
    Capital CommitmentsThe Group has no capital commitments authorised and contracted for as at December 31, 2007 (2006:
US$1,731,000). The capital commitments authorised and contracted for at December 31, 2006 related to
additional plant and equipment required for the Groups premises in Bray, Ireland as part of the
integration of the bioMerieux acquisition. All plant and equipment required as part of the
integration of the bioMerieux acquisition was acquired during 2007.(b)
    
    Leasing CommitmentsThe Group leases a number of premises under operating leases. The leases typically run for
periods up to 25 years. Lease payments are reviewed periodically (typically on a 5 year basis) to
reflect market rentals. Operating lease commitments payable during the next 12 months amount to
US$4,943,000 (2006: US$3,650,000) payable on leases of buildings at Dublin and Bray, Ireland,
Berkshire, UK, Paris, France, Umea, Sweden, Jamestown, New York, Kansas City, Missouri, New
Jersey, Concord, Massachusetts and Carlsbad, California and motor vehicles and equipment in
Sweden, UK and Germany. US$170,000 (2006: US$475,000) of these operating lease commitments relates to
leases whose remaining term will expire within one year, US$1,084,000 (2006: US$194,000) relates to
leases whose remaining term expires between one and two years, US$574,000 (2006: US$937,000) between
two and five years and the balance of US$3,115,000 (2006: US$2,044,000) relates to leases which expire
after more than five years. See note 29 for related party leasing arrangements.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Future minimum operating lease commitments with non-cancellable terms in excess of one year are as follows:
 Year ended2007Operating leasesUS$0002008
    
    
    4,9432009
    
    
    4,3702010
    
    
    3,6802011
    
    
    3,2982012
    
    
    3,138Later years
    
    
    43,122Total lease obligations
    
    
    62,551
 Year ended2006Operating leasesUS$0002007
    
    
    3,6502008
    
    
    3,8592009
    
    
    3,3422010
    
    
    2,7972011
    
    
    2,556Later years
    
    
    32,062Total lease obligations
    
    
    48,266
 For future minimum finance lease commitments, in respect of which the lessor has a charge over the
related assets, see note 21.(c)
    
    Bank SecurityThe Groups bank borrowings (note 21) are secured by a fixed and floating charge over the assets of
Group entities, including specific charges over the shares in the subsidiaries and the Groups
patents. Various covenants apply to the Groups bank borrowings with respect to profitability,
interest cover, capital expenditure, working capital and location of assets. As at December 31,
2007 the Group was in breach of a number of these covenants which had been waived by the banks.
The covenants which were breached concerned the level of earnings before taxation, depreciation and
amortisation for the year end December 31, 2007 (see note 30).At December 31, 2006, the Group was required to maintain US$15,500,000 on deposit with its lending
banks. Resulting from the restrictions on this cash, US$15,500,000 was shown as a financial asset at
December 31, 2006. See note 17. During 2007, the Groups banks agreed to remove this restriction
and at December 31, 2007, the amounts shown as a financial asset is nil at December 31, 2007 (see
note 18).(d)
    
    Section 17 GuaranteesPursuant to the provisions of Section 17, Irish Companies (Amendment) Act, 1986, the Company has
guaranteed the liabilities of Trinity Biotech Manufacturing Limited, Trinity Biotech Manufacturing
Services Limited, Trinity Research Limited, Benen Trading Limited, Trinity Biotech Financial
Services Limited and Trinity Biotech Sales Limited, subsidiary undertakings in the Republic of
Ireland, for the financial year to December 31, 2007 and, as a result, these subsidiary
undertakings have been exempted from the filing provisions of Section 17, Irish Companies
(Amendment) Act, 1986. Where the Company enters into these guarantees of the indebtedness of other
companies within its Group, the Company considers these to be insurance arrangements and accounts
for them as such. The Company treats the guarantee contract as a contingent liability until such
time as it becomes probable that the company will be required to make a payment under the
guarantee. The Company does not enter into financial guarantee with third parties.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 (e)
    
    Government Grant ContingenciesThe Group has received training and employment grant income from Irish development agencies.
Subject to existence of certain conditions specified in the grant agreements, this income may
become repayable. No such conditions existed as at December 31, 2007. However if the income were
to become repayable, the maximum amounts repayable as at December 31, 2007 would amount to US$644,000
(2006: US$581,000).
 29.
    
    RELATED PARTY TRANSACTIONS
 The Group has related party relationships with its subsidiaries, and with its directors and
executive officers.
 Leasing arrangements with related partiesThe Group has entered into various arrangements with JRJ Investments (JRJ), a partnership owned
by Mr OCaoimh and Dr Walsh, directors of the Company, to provide for current and potential future
needs to extend its premises at IDA Business Park, Bray, Co. Wicklow, Ireland.
 In July 2000, Trinity Biotech entered into an agreement with JRJ pursuant to which the Group took a
lease of a 25,000 square foot premises adjacent to the existing facility for a term of 20 years at
a rent of 7.62 per square foot for an annual rent of
190,000 (US$260,000). During 2006, the rent
on this property was reviewed and increased to 11.00 per square foot, resulting in an annual rent
of 275,000 (US$377,000).
 In November 2002, the Group entered into an agreement for a 25 year lease with JRJ for offices that
have been constructed adjacent to its premises at IDA Business Park, Bray, Co. Wicklow, Ireland.
The annual rent of 381,000 (US$522,000) is payable from January 1, 2004.
 In December 2007, the Group entered into an agreement with Mr. OCaoimh and Dr Walsh pursuant to
which the Group took a lease on an additional 43,860 square foot manufacturing facility in Bray,
Ireland at a rate of 17.94 per square foot (including fit out) giving a total annual rent of
787,000 (US$1,158,000).
 Trinity Biotech and its directors (excepting Mr OCaoimh and Dr Walsh who express no opinion on
this point) believe that the arrangements entered into represent a fair and reasonable basis on
which the Group can meet its ongoing requirements for premises.
 Compensation of key management personnel of the Group
 At December 31, 2007, the key management personnel of the Group is made up of five key personnel,
the four executive directors and the Chief Financial Officer/Company Secretary. On November 1,
2007, Mr Kevin Tansley became an executive officer on his appointment to Chief Financial Officer
and Company Secretary.
 In 2006, the key management personnel of the Group was made up of the four executive directors in
that year.
 Compensation for the year ended December 31, 2007 of these personnel is detailed below:
 December 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Short-term employee benefits
    
    
    2,293
    
    
    
    2,113Post-employment benefits
    
    
    149
    
    
    
    119Equity compensation benefits
    
    
    853
    
    
    
    6653,295
    
    
    
    2,897
 Total director emoluments included in note 6 includes non executive directors fees of US$130,000
(2006: US$100,000) and equity compensation benefits of US$67,000 (2006: US$67,000) and excludes the
compensation costs of the Chief Financial Officer of US$55,000. Total directors remuneration is also
included in personnel expenses (note 7).
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Directors and executive officers interests in the Companys shares and share option plan
 A Ordinary Shares
    
    
    Share optionsAt January 1, 2007
    
    
    5,881,205
    
    
    
    4,812,083Exercised
    
    
    
    
    
    
    Granted
    
    
    
    
    
    
    Additions *
    
    
    
    
    
    
    165,000Shares sold
    
    
    
    
    
    
    Shares purchased
    
    
    
    
    
    
    At December 31, 2007
    
    
    5,881,205
    
    
    
    4,977,083
 *
    
    Includes 75,000 options granted to Mr. Kevin Tansley prior to his appointment as Chief
Financial Officer and Company Secretary on 1 November 2007. A Ordinary Shares
    
    
    Share optionsAt January 1, 2006
    
    
    5,881,205
    
    
    
    4,211,666Exercised
    
    
    
    
    
    
    Granted
    
    
    
    
    
    
    860,000Shares sold
    
    
    
    
    
    
    (259,583
    )Shares purchased
    
    
    
    
    
    
    At December 31, 2006
    
    
    5,881,205
    
    
    
    4,812,083
 Rayville Limited, an Irish registered company, which is wholly owned by the four executive
directors and certain other executives of the Group, owns all of the B non-voting Ordinary Shares
in Trinity Research Limited, one of the Groups subsidiaries. The B shares do not entitle the
holders thereof to receive any assets of the company on a winding up. All of the A voting
ordinary shares in Trinity Research Limited are held by the Group. Trinity Research Limited may,
from time to time, declare dividends to Rayville Limited and Rayville Limited may declare dividends
to its shareholders out of those amounts. Any such dividends paid by Trinity Research Limited are
ordinarily treated as a compensation expense by the Group in the consolidated financial statements
prepared in accordance with IFRS, notwithstanding their legal form of dividends to minority
interests, as this best represents the substance of the transactions.
 In December 2006, the Remuneration Committee of the Board approved the payment of a dividend of
US$5,331,000 by Trinity Research Limited to Rayville Limited on the B shares held by it. This
amount was then lent back by Rayville to Trinity Research Limited. This loan was partially used to
fund executive compensation in 2007 and will fund future executive compensation over the next
number of years under the arrangement described above, with the amount of such funding being
reflected in compensation expense over the corresponding period. As the dividend payment is
matched by a loan from Rayville Limited to Trinity Research Limited which is repayable solely at
the discretion of the Remuneration Committee of the Board and is unsecured and interest free, the
Group netted the dividend paid to Rayville Limited against the corresponding loan from Rayville
Limited in the 2007 and 2006 consolidated financial statements.
 The amount of payments to Rayville included in compensation expense was US$1,410,000, US$1,911,000 and
US$2,061,000 for 2005, 2006 and 2007 respectively, of which US$1,333,000, US$1,779,000 and US$1,867,000
respectively related to the key management personnel of the Group. There were no dividends payable
to Rayville Limited as of December 31, 2005, 2006 or 2007. Of the US$2,061,000 of payments made to
Rayville Limited in 2007, US$955,000 represented repayments of the loan to Trinity Research Limited
referred to above.30.
    
    DERIVATIVES AND FINANCIAL INSTRUMENTS
 The Group uses a range of financial instruments (including cash, bank borrowings, convertible
notes, promissory notes, finance leases, receivables, payables and derivatives) to fund its
operations. These instruments are used to manage the liquidity of the Group in a cost effective,
low-risk manner. Working capital management is a key additional element in the effective management
of overall liquidity. The Group does not trade in financial instruments or derivatives. The main
risks arising from the utilisation of these financial instruments are interest rate risk, liquidity
risk and credit risk.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Effective interest rate and repricing analysisThe following table sets out all interest-earning financial assets and interest bearing financial
liabilities held by the Group at December 31, indicating their effective interest rates and the
period in which they re-price:
 As at December 31,2007
    
    
    
    
    
    Effective
    
    
    Total
    
    
    6 mths or less
    
    
    6-12 mths
    
    
    1-2 years
    
    
    2-5 yearsUS$000
    
    Note
    
    
    interest rate
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Cash and cash
equivalents
    
    
    18
    
    
    
    4.54
    %
    
    
    8,700
    
    
    
    8,700
    
    
    
    
    
    
    
    
    
    
    
    Secured bank loans
 floating
    
    
    21
    
    
    
    6.99
    %
    
    
    (39,808
    )
    
    
    (39,808
    )
    
    
    
    
    
    
    
    
    
    
    Secured bank loans
 fixed
    
    
    21
    
    
    
    5
    %
    
    
    (20
    )
    
    
    
    
    
    
    
    
    
    
    (20
    )
    
    
    Finance lease
liabilities  fixed
    
    
    21
    
    
    
    6.32
    %
    
    
    (2,305
    )
    
    
    (6
    )
    
    
    (39
    )
    
    
    (221
    )
    
    
    (2,039
    )Total
    
    
    
    
    
    
    
    
    
    
    (33,433
    )
    
    
    (31,114
    )
    
    
    (39
    )
    
    
    (241
    )
    
    
    (2,039
    )
 As at December 31,2006
    
    
    
    
    
    Effective
    
    
    Total
    
    
    6 mths or less
    
    
    6-12 mths
    
    
    1-2 years
    
    
    2-5 yearsUS$000
    
    Note
    
    
    interest rate
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Cash and cash
equivalents
    
    
    18
    
    
    
    5.22
    %
    
    
    2,821
    
    
    
    2,821
    
    
    
    
    
    
    
    
    
    
    
    Financial asset 
restricted cash
    
    
    17
    
    
    
    5.22
    %
    
    
    15,500
    
    
    
    15,500
    
    
    
    
    
    
    
    
    
    
    
    Secured bank loans
 floating
    
    
    21
    
    
    
    6.87
    %
    
    
    (42,917
    )
    
    
    (42,917
    )
    
    
    
    
    
    
    
    
    
    
    Secured bank loans
 fixed
    
    
    21
    
    
    
    5
    %
    
    
    (37
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (37
    )Convertible notes -
fixed
    
    
    22
    
    
    
    6.23
    %
    
    
    (1,836
    )
    
    
    (1,836
    )
    
    
    
    
    
    
    
    
    
    
    Finance lease
liabilities  fixed
    
    
    21
    
    
    
    5.91
    %
    
    
    (504
    )
    
    
    (5
    )
    
    
    
    
    
    
    (104
    )
    
    
    (395
    )Total
    
    
    
    
    
    
    
    
    
    
    (26,973
    )
    
    
    (26,437
    )
    
    
    
    
    
    
    (104
    )
    
    
    (432
    )
 The effective interest rate for the convertible notes is the normal coupon rate of 3% adjusted for
the effect of transaction costs and the equity portion of the convertible notes. The effective
interest rate on all other loans and borrowings is the same as the actual interest rates.
 Interest rate riskThe Group borrows in US dollars at floating and fixed rates of interest. Year-end borrowings
totalled US$42,133,000 (2006: US$45,294,000), (net of cash and restricted cash: US$33,433,000 (2006:
US$26,973,000)), at interest rates ranging from 5% to 6.99% (2006: 3.0% to 6.87%).
 The total year-end borrowings consists of fixed rate debt of US$2,325,000 (2006: US$2,377,000) at
interest rates ranging from 5% to 6.32% (2006: 3% to 5%) and floating rate debt of US$39,808,000
(US$42,917,000) at interest rates ranging from 6.49% to 6.99% (2006: 6.62% to 6.87%). In broad terms,
a one-percentage point increase in interest rates would increase interest income by US$87,000 (2006:
US$183,000) and increase the interest expense by US$401,000 (2006: US$433,000) resulting in an increase
in the net interest charge of US$314,000 (2006: increase by US$246,000).
  114




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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Interest rate profile of financial liabilitiesThe interest rate profile of financial liabilities of the Group was as follows:
 December 31, 2007
    
    
    December 31, 2006US$ 000
    
    
    US$ 000Fixed rate instrumentsFixed rate financial liabilities
    
    
    (2,325
    )
    
    
    (2,377
    )Variable rate instrumentsFinancial assets
    
    
    8,700
    
    
    
    18,321Floating rate financial liabilities
    
    
    (39,808
    )
    
    
    (42,917
    )(33,433
    )
    
    
    (26,973
    )
 Fixed rate instrument comprise fixed rate borrowings and finance lease obligations. The weighted
average interest rate and weighted average period for which the rate is fixed is as follows:
 December 31, 2007
    
    
    December 31, 2006Fixed rate financial liabilitiesWeighted average interest rate
    
    
    6.09
    %
    
    
    3.55
    %Weighted average period for which rate is fixed
    
    4.44 years
    
    0.46 years
 Financial assets comprise of cash and cash equivalents at December 31, 2007 and cash and cash
equivalents and restricted cash at December 31, 2006. (see notes 17 and 18).Floating rate financial liabilities comprise other borrowings that bear interest at rates of
between 6.49% and 6.99%. These borrowings are provided by lenders at margins ranging from 1.25% to
1.75% over inter-bank rates.Fair value sensitivity analysis for fixed rate instrumentsThe Group does not account for any fixed rate financial liabilities at fair value through the
statement of operations. Therefore a change in interest rates at December 31, 2007 would not affect
profit or loss.Cash flow sensitivity analysis for variable rate instrumentsA change of 100 basis points in interest rates at the reporting date would have no effect on profit
or loss for the period. This assumes that all other variables, in particular foreign currency
rates, remain constant.Fair ValuesThe table below sets out the Groups classification of each class of financial assets and
liabilities and their fair values:
 Cash flow
    
    
    Liabilities at
    
    
    TotalLoans and
    
    
    hedge
    
    
    amortised
    
    
    carrying
    
    
    FairNote
    
    
    receivables
    
    
    derivatives
    
    
    cost
    
    
    amount
    
    
    ValueDecember 31, 2007Trade receivables
    
    
    16
    
    
    
    23,104
    
    
    
    
    
    
    
    
    
    
    
    23,104
    
    
    
    23,104Cash and cash equivalents
    
    
    18
    
    
    
    8,700
    
    
    
    
    
    
    
    
    
    
    
    8,700
    
    
    
    8,700Finance lease receivable
    
    
    13, 16
    
    
    
    1,161
    
    
    
    
    
    
    
    
    
    
    
    1,161
    
    
    
    1,161Forward contracts used for
hedging
    
    
    
    
    
    
    
    
    
    
    224
    
    
    
    
    
    
    
    224
    
    
    
    224Grant income receivable
    
    
    
    
    
    
    285
    
    
    
    
    
    
    
    
    
    
    
    285
    
    
    
    285Secured bank loans
    
    
    21
    
    
    
    
    
    
    
    
    
    
    
    (39,828
    )
    
    
    (39,828
    )
    
    
    (39,827
    )Finance lease liabilities
    
    
    21
    
    
    
    
    
    
    
    
    
    
    
    (2,305
    )
    
    
    (2,305
    )
    
    
    (2,298
    )Trade and other payables
(excluding deferred
revenue)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (23,327
    )
    
    
    (23,327
    )
    
    
    (23,327
    )Other financial liabilities
    
    
    24
    
    
    
    
    
    
    
    
    
    
    
    (2,725
    )
    
    
    (2,725
    )
    
    
    (2,725
    )Other payables
    
    
    26
    
    
    
    
    
    
    
    
    
    
    
    (74
    )
    
    
    (74
    )
    
    
    (74
    )Provisions
    
    
    25
    
    
    
    
    
    
    
    
    
    
    
    (100
    )
    
    
    (100
    )
    
    
    (100
    )33,250
    
    
    
    224
    
    
    
    (68,359
    )
    
    
    (34,885
    )
    
    
    (34,877
    )
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Cash flow
    
    
    Liabilities at
    
    
    TotalLoans and
    
    
    hedge
    
    
    amortised
    
    
    carrying
    
    
    FairNote
    
    
    receivables
    
    
    derivatives
    
    
    cost
    
    
    amount
    
    
    ValueDecember 31, 2006Trade receivables
    
    
    16
    
    
    
    28,359
    
    
    
    
    
    
    
    
    
    
    
    28,359
    
    
    
    28,359Financial assets 
restricted cash
    
    
    17
    
    
    
    15,500
    
    
    
    
    
    
    
    
    
    
    
    15,500
    
    
    
    15,500Cash and cash equivalents
    
    
    18
    
    
    
    2,821
    
    
    
    
    
    
    
    
    
    
    
    2,821
    
    
    
    2,821Finance lease income
receivable
    
    
    13, 16
    
    
    
    707
    
    
    
    
    
    
    
    
    
    
    
    707
    
    
    
    707Grant income receivable
    
    
    
    
    
    
    105
    
    
    
    
    
    
    
    
    
    
    
    105
    
    
    
    105Secured bank loans
    
    
    21
    
    
    
    
    
    
    
    
    
    
    
    (42,954
    )
    
    
    (42,954
    )
    
    
    (42,953
    )Convertible notes
    
    
    22
    
    
    
    
    
    
    
    (1,836
    )
    
    
    
    
    
    
    (1,836
    )
    
    
    (1,836
    )Finance lease liabilities
    
    
    21
    
    
    
    
    
    
    
    
    
    
    
    (504
    )
    
    
    (504
    )
    
    
    (501
    )Trade and other payables
(excluding deferred
revenue)
    
    
    23
    
    
    
    
    
    
    
    
    
    
    
    (17,588
    )
    
    
    (17,588
    )
    
    
    (17,588
    )Other financial liabilities
    
    
    24
    
    
    
    
    
    
    
    
    
    
    
    (5,688
    )
    
    
    (5,688
    )
    
    
    (5,688
    )Other payables
    
    
    26
    
    
    
    
    
    
    
    
    
    
    
    (838
    )
    
    
    (838
    )
    
    
    (838
    )Provisions
    
    
    25
    
    
    
    
    
    
    
    
    
    
    
    (100
    )
    
    
    (100
    )
    
    
    (100
    )47,492
    
    
    
    (1,836
    )
    
    
    (67,672
    )
    
    
    (22,016
    )
    
    
    (22,012
    )
 Interest rates used for determining fair valueThe interest rates used to discount estimated cash flows, where applicable, based on observable
market rates plus a premium which reflects the risk profile of the Group at the reporting date,
were as follows:
 December 31, 2007
    
    
    December 31, 2006Loans and borrowings
    
    
    6.74% - 6.99
    %
    
    
    6.63% - 6.87
    %Leases
    
    
    5.84% - 7.20
    %
    
    
    5.67% - 6.00
    %
 There was no significant difference between the fair value and carrying value of the Groups trade
receivables and trade and other payables at December 31, 2007 and December, 31 2006 as all fell due
within 6 months.Liquidity riskThe Groups operations are cash generating. Short-term flexibility is achieved through the
management of the groups short-term deposits and through the use of a US$7,000,000 revolver loan
facility.The following are the contractual maturities of financial liabilities, including estimated interest
payments:
 Carrying
    
    
    Contractual
    
    
    6 mths or
    
    
    6 mths -As at December 31, 2007
    
    amount
    
    
    cash flows
    
    
    less
    
    
    12 mths
    
    
    1-2 years
    
    
    2-5 yearsUS$000
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Financial liabilitiesSecured bank loans 
floating
    
    
    39,808
    
    
    
    44,309
    
    
    
    12,537
    
    
    
    4,942
    
    
    
    9,484
    
    
    
    17,346Secured bank loans  fixed
    
    
    20
    
    
    
    21
    
    
    
    9
    
    
    
    9
    
    
    
    3
    
    
    
    Finance lease liabilities
 fixed
    
    
    2,305
    
    
    
    2,616
    
    
    
    408
    
    
    
    371
    
    
    
    550
    
    
    
    1,287Trade & other payables
    
    
    24,779
    
    
    
    24,779
    
    
    
    24,779
    
    
    
    
    
    
    
    
    
    
    
    66,912
    
    
    
    71,725
    
    
    
    37,733
    
    
    
    5,322
    
    
    
    10,037
    
    
    
    18,633
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007Trinity Biotech has a US$48,340,000 club banking facility with AIB plc and Bank of Scotland (Ireland)
Limited (the banks). The facility consists of a five year term loan of US$41,340,000 and a one
year revolver of US$7,000,000. At December 31, 2007, the total amount outstanding under the facility
amounted to US$39,808,000. Various covenants apply to these borrowings. In the event that the Group
breaches these covenants, this may result in the borrowings becoming payable immediately. As at
December 31, 2007, the Group was in breach of a number of these covenants which had been waived by
the banks. The covenants which were breached concerned the level of earnings before taxation,
depreciation and amortisation for the year end December 31, 2007 and the level of the Groups net
debt and net assets excluding intangible assets at December 31, 2007. Following these breaches the
Group has agreed new covenants with the banks under revised terms and conditions for the facility.
These covenants have been calculated based on the expected future results and cash flows of the
Group. In addition to agreeing to revised covenants, since December 31, 2007 the Group has agreed a
revised repayment schedule for the outstanding debt, which will result in an extension to the
repayment period of 12 months and will reduce the level of repayments in the 12 months after
December 31, 2007 by US$3,062,000. In addition, the margin applied to this facility has been
increased to 2.25% above LIBOR.
 Carrying
    
    
    Contractual
    
    
    6 mths or
    
    
    6 mths -As at December 31, 2006
    
    amount
    
    
    cash flows
    
    
    less
    
    
    12 mths
    
    
    1-2 years
    
    
    2-5 yearsUS$000
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Financial liabilitiesSecured bank loans 
floating
    
    
    42,917
    
    
    
    46,306
    
    
    
    6,554
    
    
    
    4,417
    
    
    
    8,834
    
    
    
    26,501Secured bank loans  fixed
    
    
    37
    
    
    
    39
    
    
    
    9
    
    
    
    9
    
    
    
    18
    
    
    
    3Finance lease liabilities
 fixed
    
    
    504
    
    
    
    535
    
    
    
    141
    
    
    
    137
    
    
    
    234
    
    
    
    23Convertible notes
    
    
    1,836
    
    
    
    1,836
    
    
    
    1,836
    
    
    
    
    
    
    
    
    
    
    
    Trade & other payables
    
    
    20,459
    
    
    
    20,459
    
    
    
    20,459
    
    
    
    
    
    
    
    
    
    
    
    65,753
    
    
    
    69,175
    
    
    
    28,999
    
    
    
    4,563
    
    
    
    9,086
    
    
    
    26,527
 Foreign exchange riskThe majority of the Groups activities are conducted in US Dollars. The primary foreign exchange
risk arises from the fluctuating value of the Groups euro denominated expenses as a result of the
movement in the exchange rate between the US Dollar and the euro. Arising from this, where
considered necessary, the Group pursues a treasury policy which aims to sell US Dollars forward to
match a portion of its uncovered euro expenses at exchange rates lower than budgeted exchange
rates. These forward contracts are primarily cashflow hedging instruments whose objective is to
cover a portion of these euro forecasted transactions. All of the forward contracts normally have
maturities of less than one year after the balance sheet date. The forward contract in place at
December 31, 2007 has a maturity of less than one year after the balance sheet date. Where
necessary, the forward contracts are rolled over at maturity. There were no forward contracts in
place at December 31, 2006.With an increasing level of euro denominated sales, the Group anticipates that, over the next three
years, a higher proportion of its non-US Dollar expenses will be matched by non-US Dollar revenues.
The Group had foreign currency denominated cash balances equivalent to US$1,659,000 at December 31,
2007 (2006: US$952,000).The Group states its forward exchange contracts at fair value in the balance sheet. The Group
classifies its forward exchange contracts as hedging forecasted transactions and thus accounts for
them as cash flow hedges. During 2007 and 2006, changes in the fair value of these contracts were
recognized in equity and then in the case of contracts which were exercised during 2007 and 2006,
the cumulative gain or losses were transferred to the statement of operations.At December 31, 2007 the fair value of the forward exchange contract in place amounted to an
asset of US$224,000. There were no forward exchange contracts in place at December 31, 2006.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 The following are the contractual maturities of the forward contract used for hedging in place at
December 31, 2007, which crystallizes in December 2008:
 Carrying
    
    
    Contractual cash
    
    
    6 mths or
    
    
    6 mths - 12As at December 31, 2007
    
    amount
    
    
    flows
    
    
    less
    
    
    mthsUS$000
    
    US$000
    
    
    US$000
    
    
    US$000
    
    
    US$000Forward contract used for hedging:Outflow
    
    
    
    
    
    
    (8,250
    )
    
    
    (5,250
    )
    
    
    (3,000
    )Inflow
    
    
    224
    
    
    
    8,253
    
    
    
    5,248
    
    
    
    3,005224
    
    
    
    3
    
    
    
    (2
    )
    
    
    5
 Sensitivity analysisA 10% strengthening of the US dollar against the following currencies at December 31, 2007 would
have increased/ (decreased) profit or loss and other equity by the amounts shown below. This
analysis assumes that all other variables, in particular interest rates, remain constant.
 Other equityProfit or loss
    
    
    movementsUS$000
    
    
    US$000December 31, 2007Euro
    
    
    1,991
    
    
    
    (20
    )Pound Sterling
    
    
    (580
    )
    
    
    Swedish Kroner
    
    
    9
    
    
    
    December 31, 2006Euro
    
    
    1,836
    
    
    
    (6
    )Pound Sterling
    
    
    (413
    )
    
    
    Swedish Kroner
    
    
    8
    
    
    
    
 A 10% weakening of the US dollar against the above currencies at December 31, 2007 and December 31,
2006 would have the equal but opposite effect on the above currencies to the amounts shown above,
on the basis that all other variables remain constant.Credit RiskThe Group has no significant concentrations of credit risk. Exposure to credit risk is monitored
on an ongoing basis. The Group maintains specific provisions for potential credit losses. To date
such losses have been within managements expectations. Due to the large number of customers and
the geographical dispersion of these customers, the Group has no significant concentrations of
accounts receivable.With respect to credit risk arising from the other financial assets of the Group, which comprise
cash and cash equivalents and forward contracts, the Groups exposure to credit risk arises from
default of the counter-party, with a maximum exposure equal to the carrying amount of these
instruments.The Group maintains cash and cash equivalents and enters forward contract, when necessary, with
various financial institutions. These financial institutions are located in a number of countries
and Group policy is designed to limit exposure to any one institution. The Group performs periodic
evaluations of the relative credit standing of those financial institutions. The carrying amount
reported in the balance sheet for cash and cash equivalents (including restricted cash for the year
ended December 31, 2006) and forward contracts approximate their fair value.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Exposure to credit riskThe carrying amount of financial assets represents the maximum credit exposure. The maximum
exposure to credit risk is as follows:
 Carrying Value
    
    
    Carrying ValueDecember 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000Third party trade receivables
    
    
    23,104
    
    
    
    28,359Finance lease income receivable
    
    
    1,161
    
    
    
    707Financial asset  restricted cash
    
    
    
    
    
    
    15,500Cash & cash equivalents
    
    
    8,700
    
    
    
    2,821Grant income receivable
    
    
    285
    
    
    
    105Forward exchange contracts used for hedging
    
    
    224
    
    
    
    33,474
    
    
    
    47,492
 The maximum exposure to credit risk for trade receivables and finance lease income receivable by
geographic location is as follows:
 Carrying Value
    
    
    Carrying ValueDecember 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000United States
    
    
    11,137
    
    
    
    12,436Euro-zone countries
    
    
    3,969
    
    
    
    5,002UK
    
    
    1,749
    
    
    
    2,428Other European countries
    
    
    583
    
    
    
    458Other regions
    
    
    6,827
    
    
    
    8,74224,265
    
    
    
    29,066
 The maximum exposure to credit risk for trade receivables and finance lease income receivable by
type of customer is as follows:
 Carrying Value
    
    
    Carrying ValueDecember 31, 2007
    
    
    December 31, 2006US$000
    
    
    US$000End-user customers
    
    
    11,974
    
    
    
    13,638Distributors
    
    
    11,723
    
    
    
    13,765Non-governmental organisations
    
    
    568
    
    
    
    1,66324,265
    
    
    
    29,066
 Due to the large number of customers and the geographical dispersion of these customers, the Group
has no significant concentrations of accounts receivable.Impairment LossesThe ageing of trade receivables at December 31, 2007 is as follows:
 Gross
    
    
    Impairment
    
    
    Gross
    
    
    ImpairmentIn thousands of US$
    
    2007
    
    
    2007
    
    
    2006
    
    
    2006Not past due
    
    
    14,288
    
    
    
    151
    
    
    
    17,458
    
    
    
    29Past due 0-30 days
    
    
    5,208
    
    
    
    65
    
    
    
    5,051
    
    
    
    13Past due 31-120 days
    
    
    3,365
    
    
    
    35
    
    
    
    3,600
    
    
    
    345Greater than 120 days
    
    
    900
    
    
    
    406
    
    
    
    3,324
    
    
    
    68723,761
    
    
    
    657
    
    
    
    29,433
    
    
    
    1,074
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007The movement in the allowance for impairment in respect of trade receivables during the year was as
follows:
 In thousands of US$
    
    2007
    
    
    2006
    
    
    2005Balance at January 1
    
    
    1,074
    
    
    
    587
    
    
    
    462Charged to costs and expenses
    
    
    578
    
    
    
    896
    
    
    
    279Amounts recovered during the year
    
    
    (190
    )
    
    
    (100
    )
    
    
    (36
    )Amounts written off during the year
    
    
    (805
    )
    
    
    (309
    )
    
    
    (118
    )Balance at December 31
    
    
    657
    
    
    
    1,074
    
    
    
    587
 The allowance for impairment in respect of trade receivables are used to record impairment losses
unless the Group is satisfied that no recovery of the account owing is possible. At this point the
amount is considered irrecoverable and is written off against the financial asset directly.Capital ManagementThe Groups policy is to maintain a strong capital base so as to maintain investor, creditor and
market confidence and to sustain future development of the business. The Board of Directors
monitors earnings per share as a measure of performance, which the Group defines as profit after
tax divided by the weighted average number of shares in issue.The Board of Directors have a policy to maintain a capital structure consisting of both debt and
equity and constantly monitors the mix of long term debt to equity. This approach is of
particular importance with respect to the acquisition strategy of the Group whereby the Group has
funded recent acquisitions using both equity and long term debt depending on the size of the
acquisition and the capital structure in place at the time of the acquisition.The Group has a long term lending facility with a number of lending banks (see note 21) and
Trinity Biotech is listed on the NASDAQ which allows the Group to raise funds through equity
financing where necessary.The Board of Directors is authorised to purchase its own shares on the market on the following
conditions;
 
    
    the aggregate the aggregate nominal value of the Shares authorised to be acquired shall not
exceed 10% of the aggregate nominal value of the issued share capital of the Company at
the close of business on the date of the passing of the resolution:
    
    the minimum price (exclusive of taxes and expenses) which may be paid for a Share shall be
the nominal value of that Share:
    
    the maximum price (exclusive of taxes and expenses) which may be paid for a Share shall not
be more than the average of the closing bid price on NASDAQ in respect of the ten business
days immediately preceding the day on which the Share is purchased.
 There were no changes to the Groups approach to capital management during the year.Neither the Company nor any of its subsidiaries are subject to externally imposed capital
requirements.
 31.
    
    ACCOUNTING ESTIMATES AND JUDGEMENTS
 The preparation of these financial statements requires the Group to make estimates and judgements
that affect the reported amount of assets, liabilities, revenues and expenses, and related
disclosure of contingent assets and liabilities.On an on-going basis, the Group evaluates these estimates, including those related to intangible
assets, contingencies and litigation. The estimates are based on historical experience and on
various other assumptions that are believed to be reasonable under the circumstances, the results
of which form the basis for making judgements about the carrying values of assets and liabilities
that are not readily apparent from other sources. Actual results may differ from these estimates
under different assumptions or conditions.Key sources of estimation uncertaintyNote 12 contains information about the assumptions and the risk factors relating to goodwill
impairment. Note 20 outlines information regarding the valuation of share options and warrants.
In note 30, detailed analysis is given about the interest rate risk, credit risk, liquidity risk
and foreign exchange risk of the Group.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Critical accounting judgements in applying the Groups accounting policiesCertain critical accounting judgements in applying the groups accounting policies are described
below:Research and development expenditureUnder IFRS as adopted by the EU, we write-off research and development expenditure as incurred,
with the exception of expenditure on projects whose outcome has been assessed with reasonable
certainty as to technical feasibility, commercial viability and recovery of costs through future
revenues. Such expenditure is capitalised at cost within intangible assets and amortised over its
expected useful life of 15 years, which commences when commercial production starts.Factors which impact our judgement to capitalise certain research and development expenditure
include the degree of regulatory approval for products and the results of any market research to
determine the likely future commercial success of products being developed. We review these
factors each year to determine whether our previous estimates as to feasibility, viability and
recovery should be changed.Impairment of intangible assets and goodwillDefinite lived intangible assets are reviewed for indicators of impairment annually while goodwill
and indefinite lived assets are tested for impairment annually, individually or at the cash
generating unit level.Factors considered important, as part of an impairment review, include the following:
 
    
    Significant underperformance relative to expected historical or projected future operating results;
    
    Significant changes in the manner of our use of the acquired assets or the strategy for our overall business;
    
    Obsolescence of products;
    
    Significant decline in our stock price for a sustained period; and our market capitalisation relative to net
book value.
 When we determine that the carrying value of intangibles, non-current assets and related goodwill
may not be recoverable based upon the existence of one or more of the above indicators of
impairment, any impairment is measured based on our estimates of projected net discounted cash
flows expected to result from that asset, including eventual disposition. Our estimated impairment
could prove insufficient if our analysis overestimated the cash flows or conditions change in the
future.Allowance for slow-moving and obsolete inventoryWe evaluate the realisability of our inventory on a case-by-case basis and make adjustments to our
inventory provision based on our estimates of expected losses. We write-off any inventory that is
approaching its use-by date and for which no further re-processing can be performed. We also
consider recent trends in revenues for various inventory items and instances where the realisable
value of inventory is likely to be less than its carrying value.Allowance for impairment of receivablesWe make judgements as to our ability to collect outstanding receivables and where necessary make
allowances for impairment. Such impairments are made based upon a specific review of all
significant outstanding receivables. In determining the allowance, we analyse our historical
collection experience and current economic trends. If the historical data we use to calculate the
allowance for impairment of receivables does not reflect the future ability to collect outstanding
receivables, additional allowances for impairment of receivables may be needed and the future
results of operations could be materially affected.
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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTSDECEMBER 31, 2007
 Accounting for income taxesSignificant judgement is required in determining our worldwide income tax expense provision. In the
ordinary course of a global business, there are many transactions and calculations where the
ultimate tax outcome is uncertain. Some of these uncertainties arise as a consequence of revenue
sharing and cost reimbursement arrangements among related entities, the process of identifying
items of revenue and expense that qualify for preferential tax treatment and segregation of foreign
and domestic income and expense to avoid double taxation. In addition, we operate within multiple
taxing jurisdictions and are subject to audits in these jurisdictions. These audits can involve
complex issues that may require an extended period of time for resolution. Although we believe
that our estimates are reasonable, no assurance can be given that the final tax outcome of these
matters will not be different than that which is reflected in our historical income tax provisions
and accruals. Such differences could have a material effect on our income tax provision and profit
in the period in which such determination is made. In managements opinion, adequate provisions
for income taxes have been made.Deferred tax assets and liabilities are determined for the effects of net operating losses and
temporary differences between the book and tax bases of assets and liabilities, using tax rates
projected to be in effect for the year in which the differences are expected to reverse. While we
have considered future taxable income and ongoing prudent and feasible tax planning strategies in
assessing whether deferred tax assets can be recognised, there is no assurance that these deferred
tax assets may be realisable. The extent to which recognised deferred tax assets are not realisable
could have a material adverse impact on our income tax provision and net income in the period in
which such determination is made.Item 18, note 13 to the consolidated financial statements outlines the basis for the deferred tax
assets and liabilities and includes details of the unrecognized deferred tax assets at year end.
The Group derecognized deferred tax assets arising on unused tax losses except to the extent that
there are sufficient taxable temporary differences relating to the same taxation authority and the
same taxable entity which will result in taxable amounts against which the unused tax losses can be
utilised before they expire. The derecognition of these deferred tax assets was considered
appropriate in light of the increased tax losses caused by the restructuring and uncertainty over
the timing of the utilisation of the tax losses. Except for the derecognition of deferred tax
assets there were no material changes in estimates used to calculate the income tax expense
provision during 2007, 2006 or 2005.32.
    GROUP UNDERTAKINGSThe consolidated financial statements include the financial statements of Trinity Biotech plc and
the following principal subsidiary undertakings:
 Principal Country ofincorporation andName and registered office
    
    Principal activity
    
    operation
    
    
    Group % holdingTrinity Biotech plc
    
    Investment and holding
    
    Ireland
    
    Holding companyIDA Business Park, Bray,
    
    companyCo. Wicklow, IrelandTrinity Biotech Manufacturing
    
    Manufacture and sale of
    
    Ireland
    
    
    100
    %Limited
    
    diagnostic test kitsIDA Business Park, Bray,
Wicklow, IrelandTrinity Research Limited
    
    Research and development
    
    Ireland
    
    
    100
    %IDA Business Park, Bray,
Co. Wicklow, IrelandBenen Trading Limited
    
    Trading
    
    Ireland
    
    
    100
    %IDA Business Park, Bray,
Co. Wicklow, IrelandTrinity Biotech Manufacturing
    
    Engineering services
    
    Ireland
    
    
    100
    %Services Limited
IDA Business Park, Bray,
Co. Wicklow, Ireland
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Principal Country ofincorporation andName and registered office
    
    Principal activity
    
    operation
    
    
    Group % holdingTrinity Biotech Financial
    
    Provision of financial
    
    Ireland
    
    
    100
    %Services Limited
    
    servicesIDA Business Park, Bray,
Co Wicklow, IrelandTrinity Biotech Inc
    
    Holding Company
    
    
    U.S.A.
    
    
    
    100
    %Girts Road,
Jamestown,NY 14702, USAClark Laboratories Inc
    
    Manufacture and sale of
    
    
    U.S.A.
    
    
    
    100
    %Trading as Trinity Biotech (USA)
    
    diagnostic test kitsGirts Road, Jamestown
NY14702, USAMardx Diagnostics Inc
    
    Manufacture and sale of
    
    
    U.S.A.
    
    
    
    100
    %5919 Farnsworth Court
    
    diagnostic test kitsCarlsbad
CA 92008, USAFitzgerald Industries
    
    Management services company
    
    
    U.S.A.
    
    
    
    100
    %International, Inc
2711 Centerville Road, Suite 400
Wilmington, New Castle
Delaware, 19808, USABiopool US Inc (trading as
    
    Sale of diagnostic test kits
    
    
    U.S.A.
    
    
    
    100
    %Trinity Biotech Distribution)
Girts Road, Jamestown
NY14702, USAPrimus Corporation
    
    Manufacture and sale of
    
    
    U.S.A.
    
    
    
    100
    %4231 E 75th Terrace
    
    diagnostic test kits andKansas City,
    
    instrumentationMO 64132, USATrinity Biotech (UK Sales) Limited
    
    Sale of diagnostic test kits
    
    UK
    
    
    100
    %54 Queens Road
Reading RG1 4A2, EnglandTrinity Biotech GmbH
    
    Manufacture of diagnostic
    
    Germany
    
    
    100
    %Lehbrinksweg 59,
    
    instrumentation and32657 Lemgo, Germany
    
    sale of diagnostic test kitsBiopool AB
    
    Manufacture and
    
    Sweden
    
    
    100
    %S-903 47 Umea
    
    sale of diagnostic test kitsSwedenTrinity Biotech France SARL
    
    Sale of diagnostic test kits
    
    France
    
    
    100
    %300A Rue Marcel Paul
21 Des Grands Godets
93 500 Champigny sur marne

France
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Signatures
  TRINITY BIOTECH PLCBy:
    BRENDAN FARRELLMr Brendan FarrellDirector/
Chief Executive OfficerDate: April 2, 2008 By:
    KEVIN TANSLEYMr Kevin TansleyCompany secretary/
Chief Financial OfficerDate: April 2, 2008  124




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Item 19 Exhibits
 Exhibit No.
    
    Description of Exhibit12.1
    
    
    Certification by Chief Executive Officer Pursuant to Section 302 of the
Sarbanes- Oxley Act of 2002.12.2
    
    
    Certification by Chief Financial Officer Pursuant to Section 302 of the
Sarbanes- Oxley Act of 2002.13.1
    
    
    Certification by Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, As
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.13.2
    
    
    Certification by Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, As
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.15.1
    
    
    Consent of Independent Registered Public Accounting Firm (KPMG)
  125