next fifteen communications group plc  annual report 20 1 0
wwwnextfi fteencom
next fifteen communications group plc 
the triangle
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making global 
connections
next fifteen communications group plc
annual report 2010 
13938ra10coverindd   1 13938ra10coverindd   1 16112010   1231 16112010   1231 get connected
introduction
i	
	 what do you think
	 visit 	 our	 website	 	
	 w wwnextfifteencom	 	
	 a nd	 give	 us	 your	 	 	
	 thoughts
next fifteen continues to look at the most  
effective way to communicate with its  
shareholders and other stakeholders following 
positive feedback we have once again created 
an enhanced online annual report that can be 
found on our website wwwnextfifteencom and 
would urge you to take a look at the case studies 
showing some of the work we do for our clients
it would be great to hear feedback from shareholders 
on the annual report or any other aspect of the  
business we would be happy to answer questions 
from shareholders at any time rather than waiting  
for the annual general meeting in january
we look forward to hearing from you
tim dyson	 chief	 executive	 officer
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13938ra10coverindd   2 18112010   1151 overview
adjusted basic earnings 
per share pence
2
845p
2009 648p
30
10
09
08
07
845
648
862
709
our results
financial highlights
operational highlights
1
 see note 5 of the fi nancial statements  
2
 see note 10 of the fi nancial statements
ebitda increased to £84m from 
£55m last year
22 of clients are serviced in 
more than one country but they 
represent 63 of revenue
acquired m booth  associates 
a consumerfocused pr agency 
based in new y ork in august 2009
acquired 55 of upstream asia 
to create bite asia in october 2009
acquired a further 36 of us 
policy communications business 
463 communications taking 
stake to 76
created beyond a new digital 
consultancy by combining 
context analytics with 
acquired type 3
revenue £m
£723m
2009 £654m
11
10
09
08
07
723
654
631
593
adjusted profit before tax £m
1
£661m
2009 £525m
26
10
09
08
07
661
525
658
558
dividend per share pence
185p
2009 170p
9
10
09
08
07
185
170
170
150
01
next fifteen communications group plc
annual report 2010
ifc introduction
01 highlights
02 our global footprint
04 our global brands
06 chairman’s statement
bu usines ss review
08 chief executive offi  cer’s 
review
10 operational review
22 financial review
g gov vernance
26 board of directors
28 senior management 
team
30 report of the directors
35 remuneration report
40 directors’ statement on 
corporate governance
43 statement of directors’ 
responsibilities
44 independent auditors’ 
report
f fi in na anc cial sta atements
46 consolidated income  
statement
47 consolidated statement 
of comprehensive 
income
48 consolidated balance 
sheet
49 consolidated statement 
of changes in equity
50 consolidated statement 
of cash fl ow
52 notes to the accounts
87 company balance sheet
88 reconciliation of 
movements in 
shareholders’ funds
89 notes forming part of the 
company fi nancial 
statements
a add d di iti ion na al i info ormation
94 fiveyear fi nancial 
information
95 financial calendar
95 advisers
95 investor relations 
contacts
96 contact information
13938ra10p0129indd   01 13938ra10p0129indd   01 16112010   1214 16112010   1214 making connections 
worldwide
next fifteen has 48 offi  ces in 19 countries and a client list that 
includes many of the highestprofi le international brands 
the group employs more than 900 people and has become 
one of the world’ s most respected communications groups
the group has achieved this level of global coverage largely through 
organic growth from its 1981 start up but has in recent years 
supplemented that with some notable acquisitions the group 
remains ambitious and is committed to international expansion 
and intends to open more offi  ces for existing brands with the 
possibility of further acquisitions where the strategic fi t and value 
are compelling
our global footprint
us and canada
the headquarters of many of the world’s largest 
companies are in the us and so unsurprisingly it is 
our largest market for public relations next fifteen 
has 14 offi  ces located in some of the us technology 
industry’s major cities and one in canada our staff  of 
over 300 provides some of the highest quality pr 
media and analyst relations public aff airs research 
digital consultancy and fi nancial communications 
in the marketplace 
united kingdom
the united kingdom remains an important market 
for the group with more than 200 employees in 
fi ve brands providing pr research and digital 
communications to some of the world’s largest 
technology and consumer names including ibm 
amd microsoft and cocacola london is the 
headquarters of next fifteen and is the group’s 
largest employment city
brands operating in the us and canada
 text 100  bite  outcast 
 463 beyond m booth
brands operating in the united kingdom
 text 100 bite redshift research
 lexis beyond
02
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   02 13938ra10p0129indd   02 16112010   1214 16112010   1214 europe and africa
next fifteen has 1 2 offi  ces and a licensed partner 
in europe and africa with around 100 consultants 
providing services to companies of all sizes many of 
our accounts in this region are multicountry 
engagements and bite is seeking to extend its reach 
with the opening of an offi  ce in germany in the 
coming year
asia pacifi c
with 16 offi  ces and three licensed partners 
next fifteen has a considerable presence in a region 
where local knowledge is often the most vital 
criterion for success in business the group’s 275 staff  
and many licensed practitioners serve clients in ten 
countries across the region these include some of 
the world’s largest technology companies but 
increasingly covers other sectors too
brands operating in europe and africa
 text 100 bite
brands operating in asia pacifi c
 text 100 bite
iv
visit our website 
wwwnextfi fteencom 
for more on our offi  ces
overview
business review
governance
financial statements
additional information
03
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   03 13938ra10p0129indd   03 16112010   1214 16112010   1214 next fifteen communications group plc is the 
holding company for a worldwide group of 
communications consultancies
it comprises fi ve independently operating subsidiary pr 
brands next fifteen also owns a research business a policy 
communications business and a digital consultancy 
our global brands
text100
text 100 is next fifteen’s largest brand founded in 
1981 it now employs over 400 people in 26 offi  ces in 
major commercial centres around the world it has 
built its reputation on an intimate knowledge of the 
technology industry a painstaking focus on quality a 
passion for new ideas and a commitment to fl awless 
execution these attributes put into practice every 
day by highquality professionals with immense local 
knowledge enable text 100 to work for some of the 
world’s most powerful companies including ibm 
lenovo cisco xerox and sandisk
wwwtext100com
bite
bite which was founded in 1995 employs over 180 
people from its offi  ces in london stockholm paris 
san francisco new york toronto beijing hong kong 
shanghai singapore and sydney bite brings 
determination and zeal to its communications 
campaigns for its range of b2b and b2c clients 
bite has built its business on a strategy of developing 
creative resultsoriented campaigns for market
leading brands and for fastgrowing startup brands 
its client list includes amd hp  microsoft and sony
wwwbitecommunicationscom
the outcast agency
next fifteen acquired the outcast agency in 2005 
from its offi  ces in new york and san francisco 
outcast partners with some of the worlds most 
innovative companies to devise smart 
communications strategies that amplify their unique 
narratives the agency works with clients of every 
size in industries ranging from consumer gadgets to 
web services greentech to enterprise hardware 
software to social networking and more outcasts 
clients include amazon emc facebook intuit 
salesforcecom nike netfl ix vmware and yahoo
wwwtheoutcastagencycom
lexis public relations
next fifteen bought a 25 stake in lexis public 
relations in 2005 and in 2008 increased its
ownership to 100 now employing around 
90 members of staff  lexis is a fullservice agency 
with consumer corporate healthcare sport and 
youth divisions these provide indepth pr expertise 
supported by planning creative digital marketing 
sponsorship and design specialists lexis delivers 
awardwinning campaigns for some of the uk’s 
bestknown brands including barclays boots 
cocacola dove and unilever
wwwlexisprcom
04
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   04 13938ra10p0129indd   04 16112010   1214 16112010   1214 m booth
next fifteen acquired new yorkbased m booth  
associates in august 2009 which expanded next 
fifteen’s presence in the consumerpr market 
m booth specialises in building strong and powerful 
brands it represents some of the world’s bestknown 
corporations and products across several industries 
including consumer goods consumer health beauty 
fashion and retailing travel and lifestyle food and 
beverage wine and spirits online brands corporate 
communications and technology its client list 
includes jcpenney vaseline and us virgin islands
wwwmboothcom
redshift research
redshift research was established as a subsidiary of 
the group in 2007  it is a fullservice market research 
consultancy which conducts both businessto
business and consumer research it has a strong 
record in the consumer technology and it sectors 
particularly in support of pr research
    
wwwredshiftresearchcouk
beyond
beyond is next fifteen’s digital consultancy launched 
in september 2010 by integrating context analytics 
next fifteen’s research and analytics business 
type 3 a recently acquired digital creative agency 
and consultants from bite communications beyond’s 
mission is to rethink the traditional digitalagency 
approach and use a combination of earned owned 
and paid media to maximise relevant traffi  c to brand 
properties and experiences beyond had offi  ces in 
san francisco london and new york  
wwwbyndcom
463 communications
next fifteen owns a 76 stake in 463 a 
communications consultancy based in washington 
dc this seniorlevel fi rm helps corporations industry 
groups and other agency teams develop databased 
communications campaigns around key issues that 
establish business technology and public policy 
leadership and brand building
www463com
visit our website 
wwwnextfi fteencom for 
more on our brands
fv
overview
business review
governance
financial statements
additional information
05
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   05 13938ra10p0129indd   05 16112010   1214 16112010   1214 next fifteen communications group plc 
‘next fifteen’ or ‘the group’ the global public 
relations consultancy group is pleased to report its 
results for the year to 31 july 2010 the group has 
emerged from the global recession to produce 
record results and continues to trade well despite 
ongoing uncertainties in the western economies 
the group has reported revenues up 106 to 
£723m 2009 £654m profi tability has recovered 
well with profi t before tax up 68 to £53m 
2009 £32m while adjusted profi t was up 26 
to £66m 2009 £52m see note 5 basic earnings 
per share rose 84 to 675p 2009 367p with 
adjusted basic earnings per share up 30 at 845p 
2009 648p see note 10 the group continues to 
have a strong balance sheet ending the year with 
net debt of £09m 2009 net cash of £18m see note 
1 9 achieved after making £51m of acquisition
related payments in view of these results and the 
current trading the board has proposed a fi nal 
dividend of 1375p per share which sees dividends 
increase 9 to 185p for the year 2009 170p 
the group has recently acquired an 85 stake in 
san franciscobased the blueshirt group llc 
an investor relations company that services 
the technology market see note 29 
the blueshirt acquisition will give opportunities 
for cross referrals between the group’s existing us 
businesses whilst also opening up a revenue 
stream in a new sector of communications
corporate activity
at the start of the fi nancial year the group 
announced the acquisition of new yorkbased 
consumer agency m booth  associates inc this 
was followed in october 2009 by the acquisition of 
the asian pr assets of aimlisted upstream marketing 
and communications inc which expands the 
group’s operations in asia pacifi c upstream has 
been integrated into bite’s business to complement 
its existing us and european operations during the 
year the group purchased a further 36 stake in 
463 communications llc a usbased policy 
communication consultancy increasing its holding 
to 76 just after the year end the group launched 
beyond a digital agency which has offi  ces in 
london new york and san francisco this was 
created by combining the group’s existing context 
analytics business and type 3 limited a digital 
agency acquired in august 2010 this new venture 
has already secured clients that include google 
cisco hilton hotels and virgin america lastly the 
group recently acquired onexeno limited a digital 
marketing agency in hong kong which has been 
integrated with bite’s operations in that region 
chairman’ s statement
“ the group has 
emerged from the 
global recession to 
produce record 
results”
see page 23 for more 
on our results
             p
adjusted eps p
845p
2009 648p
30
10
09
08
07
845
648
862
709
dividend per share p
185p
2009 170p
9
10
09
08
07
185
170
170
150
06
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   06 13938ra10p0129indd   06 16112010   1214 16112010   1214 segmental performance 
the us and canada pr business was strengthened 
by the addition of m booth and now delivers around 
half the revenue for the group and more than half its 
profi ts the uk pr segment remains the second 
biggest despite a yearonyear decline but grew 
7 5 in the second half showing good momentum 
europe and africa had stable revenue aided by 
a stronger euro and it was pleasing to see an 
improvement in the operating margin the asia 
pacifi c segment showed 30 revenue growth 
aided by stronger currency and the acquisition of 
upstream which added £2m of revenue but as a 
breakeven business it had the eff ect of reducing 
segment margins the upstream business is now in 
profi t which will help segment margins improve 
in the future the other segments are research 
and digital consultancy where good progress 
is being made
clientbase continues to improve
the group has an impressive clientbase that 
includes ibm microsoft cisco facebook hp  amd 
unilever and cocacola this has been further 
improved by the addition of tivo allied bakeries 
hershey’s alibaba bloom energy trend micro and 
schneider electric the top ten clients accounted for 
32 of revenues at the year end this compares to 
36 in 2009 unlike some other marketing services 
groups next fifteen has no direct exposure to 
government spending and will therefore be largely 
unaff ected as western governments cut back on 
expenditure in this area
strategy
the group continues to explore organic growth 
opportunities supported by selective acquisitions 
of specialist agencies in growth sectors hence the 
acquisitions of m booth upstream onexeno type 3 
and blueshirt mentioned above the creation of 
digital agency beyond which increases the group’s 
capabilities in social media and related digital 
services is further evidence that the group 
continues to focus on longterm growth 
with strong cashgeneration from operations and 
existing acquisition facilities the group remains 
well placed to make additional targeted acquisitions 
of a size that would maintain a strong balance sheet 
an approach that the board continues to feel is 
prudent given the current economic climate
prospects
the group has recovered well from the economic 
slowdown and has continued to invest in its future 
while maintaining one of the most conservative 
balance sheets in the uk marketing services sector 
it remains highly ambitious and believes it has 
signifi cant opportunities for growth over the 
medium term through both organic growth and 
selective acquisitions the group is experiencing an 
improvement in trading conditions particularly in 
north america and asia but will continue to manage 
the business in a way that refl ects the general 
uncertainty that surrounds the pace of economic 
recovery that said in the fi rst two months of the 
current fi nancial year the group has seen good 
momentum and the board remains optimistic 
about prospects for the year
will whitehorn
chairman
12 november 2010
overview
business review
governance
financial statements
additional information
07
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   07 13938ra10p0129indd   07 18112010   1259 18112010   1259 last year i wrote that there was no substitute 
for doing great work i also referenced the growing 
role digital communications was playing in the 
marketing world in the last 1 2 months digital 
has become the focus of all forms of marketing 
as companies grapple with the shift away from 
traditional media towards social networks social 
media and the growing consumption of webbased 
content from both traditional and completely new 
sources this is a shift that creates a great opportunity 
for an agency group like ours it is forcing brands 
to completely rethink the way they tackle their 
marketing in the past brands have ‘controlled’ their 
messaging and brand positioning through a series 
of controlled events such as placed advertising 
press conferences and product placement today 
consumers are starting their own conversations 
about products and brands on places such as 
facebook or on vertical social networks through 
ning or grouply as a result brands now have 
to fi gure out how to shape a conversation they 
didn’t start and can’t control these are in short 
exciting times
digital from every angle
against this backdrop of change the agency world 
has had to cope with global economic uncertainty 
making the bets we have had to take feel all the 
more challenging i’m pleased to report that as a 
group our results show that we are already seeing 
returns on the investments made in digital and i am 
excited to see the doors that digital is starting to 
open for our business we are approaching digital 
from every angle we are embedding digital thinking 
and products into our traditional services but we 
have also created a specialist digital agency to off er 
advanced digital services to all the group’s clients 
this new agency is called appropriately beyond and 
it has offi  ces in london san francisco and new york 
it brings together traditional web developers 
graphic designers analysts search specialists and 
pr consultants in the creation of a set of services that 
are closer to digital advertising than pr in the way 
they look but fully embrace the infl uence model at 
the core of public relations this may be why it has 
already secured clients that include cisco virgin 
america google and hilton hotels
more than just technology
when the dot com bubble burst in 2001 we were 
a technology specialist group today we derive a 
quarter of our revenues from clients that include 
unilever boots hersheys and most recently dyson 
and no i’m not related in the next few years we will 
look to invest in the corporate pr and healthcare 
arena further diversifying our clientbase while still 
remaining highly specialised in the services we off er 
these customers these moves coupled with the 
continued expansion of the technology industry 
ensure that there is no reason why our business 
should stop expanding
chief executive offi  cer’s review
73 2
number of clients 
2009 626
854
average number of staff 
2009 847
48
offi  ces worldwide 
2009 43
see pages 45 for 
more on our brands
             p
08
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   08 13938ra10p0129indd   08 16112010   1214 16112010   1214 global hasn’t gone away
while our industry has been tackling digital it can’t 
ignore the importance of emerging markets and
the desire of large companies to manage their 
communications globally these shifts are 
understandable first the importance of markets 
such as china and india cannot be overstated right 
now second the shift towards the internet being 
the new platform for communications is breaking 
down traditional geographic borders particularly in 
developed countries this is why we have continued 
to invest in emerging markets with the acquisitions 
of upstream asia that extends our bite business 
into the asia pacifi c region and of onexeno which 
adds to our ability to provide digital services in 
those markets
more growth to come
while there is still some uncertainty around the 
global economy i am confi dent that our business 
will deliver robust growth in the coming year 
the investments of the last few years are already 
providing revenue growth and that will only 
continue which should again lead to record results 
in the year to 31 july 201 1 to be in this position is 
testament to the quality of the businesses that make 
up the group and the decisions they’ve made 
i’m pleased to say that all of our businesses are set 
to expand which should only be good news for 
our shareholders 
to end this review i would like to thank all the 
people who make up next fifteen for their eff orts 
in the last year to deliver the strong recovery we 
achieved i would also like to thank you as 
shareholders for your continued support 
we have ambitious plans for the group which 
we hope you will all be a part of
“ in the last 1 2 
months digital 
has become the 
focus of all forms 
of marketing as 
companies grapple 
with the shift away 
from traditional 
media”
tim dyson
chief executive offi  cer 
12 november 2010
follow tim on twitter
timdyson
overview
business review
governance
financial statements
additional information
09
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   09 13938ra10p0129indd   09 16112010   1214 16112010   1214 operational review
introduction
the us market remains the most important for the 
group generating 52 of group revenue in the 
year ended 31 july 2010 the year started with bite 
having to adjust to the loss of its biggest client 
sun microsystems following suns takeover by 
oracle text 100 also started the year on the back 
foot with the focus rightly on client retention and 
cost containment despite these challenges both 
businesses responded extremely positively with 
bite winning the hp corporate account focusing 
on innovation and sustainability and text 100 
winning schneider electric and a number of project 
assignments from existing large clients such as ibm 
lenovo and cisco outcast had the most successful 
year developing new business and cultivating 
stronger relationships with existing clients such 
as admob intuitt urbo t ax and yahoo which 
signifi cantly increased their budgets helping to drive 
1 5 revenue growth for outcast despite a faltering 
recovery in the us economy
corporate activity
in august 2009 the group welcomed new york 
based consumer agency m booth  associates to 
its us interests and it made a very successful start 
to life within the next fifteen family during the year 
the group also increased its investment in policy 
communications company 463 communications 
to 76 in august 2010 beyond was formed by 
bringing together the existing context analytics 
business and combining it with the recently acquired 
type 3 to create a specialist digital consultancy with 
a base in san francisco and an offi  ce in new york 
in november 2010 the group acquired 85 of the 
blueshirt group llc a technologyfocused fi nancial 
communications company based in san francisco 
and new york these investments demonstrate the 
group’s commitment to and confi dence in the us 
market the group now has 1 5 offi  ces in the us and 
canada region and employs over 300 members 
of staff 
client wins and extended relationships
in tough economic times the focus is rightly on 
keeping existing clients happy however to grow 
their business the next fifteen brands were also 
busy pitching and winning some exciting new 
clients m booth added schwan’s pirate’s booty 
hershey’s and evenfl o whilst also extending its 
relationship with american express outcast won 
new clients including acadia bloom energy 
kaching netfl ix and vevo and extended existing 
relationships with autodesk salesforcecom and 
emc bite’s year was dominated by bedding in the 
new global hp corporate account but it also won 
new retainer accounts from ezshield mocana 
parallels and tivo in addition to schneider electric 
text 100’s other new clients included 
communispace kroll ontrack and nvidia
us and canada
£3 7 3m
revenue
american express ibm facebook 
xerox cisco yahoo 
hp amd lenovo 
vmware emc intuit
salesforcecom jcpenney sybase
key clients
10
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   10 13938ra10p0129indd   10 16112010   1214 16112010   1214 visit our website 
wwwnextfi fteencom for 
more on this story
fv
overview
business review
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11
next fifteen communications group plc
annual report 2010
it’ s y ou
the outcast agency san francisco 
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13938ra10p0129indd   11 13938ra10p0129indd   11 16112010   1214 16112010   1214 operational review continued
social media and digital communications
the biggest trend in the last year has been the 
widespread acceptance of digital and social 
media as a phenomenon that has changed the 
communication landscape forever overall 
clients’ understanding of social media and digital 
communications has moved from a tactical 
consideration to a strategic imperative that 
underpins most if not all communications 
programmes whether it is corporate and senior 
executive blogs facebook and t witter management 
building online communities ipad and iphone 
application launches or searchengine optimisation 
clients are looking for better ways to engage with 
their target audiences and measure the return on 
investment from pr that is searchable and sociable 
as summed up by an outcast senior executive 
“we live and breathe social media everyday – from 
our work with facebook to building social media 
communities for netfl ix to pioneering new 
measurement tools we are all social outcasts”
working together 
the next fifteen brands in the region have had a 
successful year working together m booth is working 
with bite to support amd in its vision technology 
work beyond has supported m booth in its 
work with american express and evenfl o 
463 communications and bite have worked 
together on verisign’s 25 years of com campaign 
and 463 communications also supported text 100 in 
schneider electric’s one government programme 
aimed at driving energy effi  ciency awareness 
among key stakeholders in washington dc on a 
broader front outcast used text 100 in the 
international launch of the amazon kindle
recognition
doing great work is important for clients and 
rewarding when recognised by others text 100 was 
honoured for corporate media relations work for 
‘recasting ibm’s image for a smarter planet’ and for 
businesstobusiness marketing with xerox bite won 
sabre’s hardware technology campaign of the year 
for an amd campaign on battery life
people
as the new fi nancial year started there were two 
signifi cant changes to the senior management in 
the us firstly the outcast agency welcomed alex 
constantinople who joined as a partner in the role 
of chief operating offi  cer from conde nast’s wired 
magazine but that news was tempered by the 
decision of cofounder margit wennmachers to 
leave the agency for a career in venture capital with 
client andreessen horowitz over at bite the search 
for a new leader of the us business was concluded 
with the appointment of michelle herman who 
brings a wealth of experience from her roles both 
inhouse and within the agency world most 
recently at waggener edstrom
the year ahead
with the recent acquisition of the blueshirt group 
llc next fifteen has a strong business in the 
fi nancial pr fi eld and the opportunity to off er a 
broader portfolio of skills to its clients in the us 
as calendar year 2010 unfolded momentum 
was building and our expectation is that 
notwithstanding the economic risks the us 
businesses should see a progressive year with 
organic growth returning in the fi rst half of the 
current fi nancial year to add to the boost provided 
by the acquisitions of blueshirt and type 3
us and canada continued
12
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   12 13938ra10p0129indd   12 16112010   1214 16112010   1214 visit our website 
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t elling 500 million 
stories
the outcast agency san francisco 
fa face c bo ook ok app ppoi oint nted e o out utc ca ca ast s to 
pr promot ote e the 50 500 0 mi mill llio on n u us sers mile est s one 
in a p pos ositive ligh ght t  illus str trat atin ing how 
face cebo book plays ys s a a b benefi efi cial role in t th th the e e e
li iv ve ves s of of p p peo eop pl ple e ar arou ound t the h world
ou ou utc tcas as st t t pa part rt rtne ne nere re red d d i wi wi h th th t d d d dev l el elop p per ers to o o o 
cr crea ea e te te e a a ‘ ‘fa fa ace ce cebo b book k ok ok s s s s sto to tori ries es es s’ ’ ’ ’ ’ ap ap ppl pl pl plic ic ic c t at ati io io i n n 
fo for r us us user ers s to to o o p p pos ost t un u un n u iq iq que ue u ue a a and d nd nd d p p p p per er erso so so sona na nal l l 
a ac c cc co c un n un n unts ts t ts t a a a abo bo o out ut ut h h h how ow w ow t the h he hey y y y us use e fa f fa a a ace ce ce ceb bo bo bo bo o o k ok k ok ok o ok k 
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next fifteen communications group plc
annual report 2010
13938ra10p0129indd   13 13938ra10p0129indd   13 16112010   1214 16112010   1214 introduction
the uk is the second most important revenue 
market for the group representing over 20 of total 
revenue it is also the place where the group was 
founded back in 1 981 and although tim dyson the 
group ceo has been based in the us for the last 
1 5 years most of the remaining central functions are 
in london the uk had a tough calendar year 2009 
which resulted in revenue for the year to 31 july 2010 
being down 98 there was a focus on cost 
reduction so that the businesses can benefi t faster 
from operational gearing as revenue growth returns
client wins
despite the economic climate and the clear need to 
deliver outstanding work to existing clients there 
was still a desire to pitch and win new clients 
this resulted in new business from mtv psion 
kroll ontrack safenet hp  harman international 
and allied bakeries
research
research agency redshift has a diff erent business 
model being almost exclusively reliant on ad hoc 
projects therefore the success of this business 
depends on its ability to win deliver and secure 
repeat commissions from clients working with 
other parts of the group was a key objective when 
redshift was formed and this has been extended 
of late through its work with m booth in new york 
redshift now generates 30 of its revenue from 
international clients and the growth and 
eff ectiveness of its online consumer panel has 
been critical to this international expansion 
increased momentum in social media 
with client budgets under pressure greater 
emphasis was placed on return on investment and 
metrics to prove wise spending this has coincided 
with the industry reaching tippingpoint in social 
media and digital communications which are now 
embedded in over 90 of client pr programmes 
the mass penetration of the internet means 
that consumers can easily access opinion on 
organisations and their products opinion became 
a critical factor in any purchase decision and pr 
is ideally placed to infl uence opinion 
operational review continued
£1 5  1 m
revenue
boots coca cola dove
microsoft hp harman
amd sony ibm
unilever nxp actavis
barclays logica burton’s foods
key clients
united kingdom
14
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   14 13938ra10p0129indd   14 16112010   1214 16112010   1214 bringing 
happiness 
and rewards 
lexis
the brief was to o a ass s ss sso o o ociate cocacola 
with happiness  le le lexi xi xis s s s did this by creating 
a sequel to the h hu hu u hu huge ge e e e gely successful 
happiness mach hi in ne fi fi lm developed in 
the us but with h h a a a u u un niquely british twist 
th through the inte te e e e eg gr gr g at t t t tion of traditional 
di d di digi gi g gita ta a tal l l an an nd d so so s ci c a a al al m m me e e ed edia a i ia  
t t t t th the e e ca ca ca camp mp mpai ai a aign gn n gn e e e e e e e e ex x xc xc xc xc xc xc xc xc x xc xc x xc x x e ee ee e e ee e e eede de e d ded d d ex x expe pe pect ct c ctat a at atio io i ions ns ns 
w w wi wi wi w w th th th o o ove ver 37 37 375 5 5 50 00 00 0 0 0 0 0 00 00 0 000 0 0 0 0 0 v vi vi vi i vi v v e e e e ew e ew ew w e e s s s in in in in t t the he e fi fi fir r rst t s 
mo m mo mo m mo m mon nt nth h an an nd d d 1 1 1 m m m mi mi i i i i i m m m m m m m l ll l ll l l ll l ll ll l io i i i i io io io o io o io o o on n n n n n    n n n n n n n n n s s s soc oc ocia ia ial l me e me e ed di i di i d dia a 
im im im m im im m m mpr pre es i i sion ons s
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15
ne n ne e ex x x x x x x x x x x x x x x x x ex x x x xt t t f f f f t t f t t t f t t ift ift ift ift ift t t i i e e e e een een een een n een en e e een n e e e n e n co c co c co c c m m mmu mun n ni nic ic c c c c n c n c c c i i a a a a a a at at t t t t ti i i i at t a i i a at at tio o o o ons ns s s s s n o o s s o on ons g g gr gr gr r r g g gr r r g gro o o o ou oup oup o ou u ou ou oup oup p p p p p o o o oup o ou oup u ou oup o ou oup oup o o ou u ou o o o ou oup ou oup p p  pl pl pl lc
an an n nn nn n n n n n n a n n n nu u ua ua a a a al al al l ua ual a ua u u l a ua u u l l re re re e  re re re  r por por r r r o or r r or r o t t t t t t 2 2 2 2 2 t t t 2 2 t t t t t t 0 010 10 0 0 0 0
13938ra10p0129indd   15 13938ra10p0129indd   15 16112010   1215 16112010   1215 we are helping clients move from a siloed approach 
to marketing disciplines to one of truly integrated 
campaigns whereby traditional media infl uencer 
engagement and social media work to complement 
the complete marketing mix bite has embraced this 
change with its point of view methodology which 
is a specialistdriven approach encompassing digital 
strategy and execution sales and marketing 
programmes design and written and visual content 
creation the client’s story is clearly defi ned in terms 
of the target community and the conversations they 
are having with the aim of presenting relevant and 
compelling content across multiple channels
london hub
as well as being an important market in its own 
right london acts as lead offi  ce for a number of 
paneuropean and global programmes text 100 
delivers over 60 of its uk client campaigns across 
multiple markets these campaigns including ibm 
sandisk and amd where it works alongside bite – 
which itself runs signifi cant european campaigns 
for new clients hp and harman international 
from london
recognition
the uk businesses have been through a diffi  cult year 
but they all recognise the continued need to put hr 
at the heart of their business t alented people attract 
the best clients and that combination has again 
resulted in some great client work for brands such
as nxp semiconductors guinness world records 
and channel 4 which was shortlisted for awards 
text 100 lexis and bite all featured in the sunday 
times best small company to work for list in the uk s
with bite coming 7th
the year ahead
the year ended 31 july 2010 has been diffi  cult but 
the new fi nancial year started with momentum 
the uk businesses of next fifteen have weathered 
the downturn and taken the right action and are 
well positioned to benefi t from the improving 
outlook albeit with an increase in the level of project 
work rather than retainers next fifteen invested in 
the uk market with the recent glasshouse 
partnership acquisition for lexis and the creation 
of beyond following the acquisition of type 3 and 
the group is confi dent that good progress will be 
achieved in the uk during the current fi nancial year
operational review continued
united kingdom continued
16
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   16 13938ra10p0129indd   16 16112010   1217 16112010   1217 turismo madrid 
lexis
th th the e e re regi g on on o of f ma ma ma adr dr dr d id id id i i is s s s bi bi bi bidd dd d dd d dd dd din in n in in i i g g g g g to to h h hos os s s s st t t 
th th the e e ry ry ry ryde de de de er r r r r cu cu c cu cu cup p p in in i in 2 2 201 018 8 8 an and d d is is c c c c com om om o p pe pet ting ng ng g g g 
ag agai ai ai ains ns ns nst t t t fr fr fr fran an an an nce ce ce ce  ge ge ge ge erm rm rm rman an an an n an a y y y y y y h h h h h h hol ol ol o o o la la la a la l nd nd n 
an an an n n a d d d d d d po po po po po p rt rt rt r ug ug ug ugal al l l  
th th h he e e br br br b b b ie ie i i ie i f f f f f f wa wa wa wa a was s s s s to to to to d d d dri ri r rive v ve v p p p p p pan an ane e e eur ur u u u ur r rop p p o o ea ea e e n n
a aw w w w w war ar ar ar re en en e en en e e es es es es es ss s s s s s an an n n n n n nd d d d d d po po o osi s si siti ti i t ve ve e e e m m m mes essa sa sag gi gin n ng g g 
ar arou ou ou oun n n nd nd nd d m m m m m ma a a adr r ri ri rid’ d’ d’ d’ d’ d’ d s s s s b b bi i id d d d   p pa a ar ar a ti ti i tic c c cula la lar rl rl rly y y
a ac ac ac a r ro o oss ss ss ss ss m m m m m med ed ed ed e ia a c c c co o o on on o su su u u u u ume m m m d d d d d by by by y y t the he he he h h h h 
r r ry ry ry r de de de e de de d r r r r r cu cu cu cu cu cu c cup p p p p p c co co o c co c m mm mm mm mm m m it it it tte te te te t t te ee e e e e l l l l l lex ex ex ex ex ex e is is is s is is c c c c c c cre re re re eat at at ated ed ed ed e e e 
a a a a  15 15 5 15 5 5 5m m m mon on on onth th th th m m m mar ar ar arke ke ke keti ti ti ting ng ng ng c c c com om om ommu mu m m ni nica ca a a a a at ti t t on on on on n n ns s s s
pr pr pr pr p p pr pr pr p og og og g og og og ogra ra ramm mm m m e e
le le e e e e e le e e e e exi xi i xi x x xi i i is s s s h h ha ha ha ha h ha a a a a a a h ha ha a a as s s s s s s s s s s s s s s s s he he he e he he e h he e h he h h h h h he he he h h h h he h h h help lp l e ed ed d ed d d d d d d d d d d d d d d d d d dr ri ri ri ri i r ri r r ri r ve ve ve ve ve ve ve e ve ve ve e ve ve e e ve ve ve ve ve ve e e e e p p p p p  p  p pos o o it it it t it t t tiv v v v v v v v v v v iv v v v ve e e e e e e e
aw aw aw w w w w w w w war ar r ar ren en en en n n n n n n e en n n n enes es es es e es es es e es e e es ss s s s s s s s s s s s s s o o of of of o o o of o m m m ma ad ad ad ad d d d d d d ad d d d i i i ri ri ri ri rid d d d’ d’ d’ d’ ’ d’ d’ d s s s s s s s s s s bi bi bi bi b b bi bi b b b d d d d w w w w w w w w w w w w w w w w w w w w w wh hi hi h h h h h h hi h h ch ch h ch ch h c i i i i i i i i i is s s s s s s s s s s s s 
cu cu cu u cu cu u c rr rr rr rren en nt t t tl tl t t t t t tl t t t t tl t t t y y y y y y y y y y vi vi i vi vi vi vi vi v e e ew e ew ew ew w e e e ew e e e e e e e ew e e e ed d d d d ed d d d a a a a a a a a a a   a a a a a a as s s s s s s s s jo jo jo o jo jo o join i in in n n n n i in in in in in in in n nt t t t t t t t t fa fa fa fa f f fa a f v v vo v vo vo vo vo vo o o o o vo o v vo vo vo vo vo o o o o o v v ur ur r ur r ur u it it it it ite e e e e e e e 
a a a al l a al al l a o o on on on on o o o g g g g g w w w wi wi w w wi w wi wi w w wi wi wi wi w w th th th th th th h h th t t t t t th th th t f f f f f f f f r r ra ra ra ra a a r r r r r nc c nc nc c c c ce e e e    e e e e e e e e e e e  e e e e e e e e e e
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next fifteen communications group plc
annual report 2010
13938ra10p0129indd   17 13938ra10p0129indd   17 16112010   1217 16112010   1217 operational review continued
introduction
the europe and africa region represented 1 35 
of group revenue in the year ended 31 july 2010 
parts of the region were aff ected in a similar way to 
the united kingdom in terms of client budget cuts in 
the calendar year 2009 although the overall impact 
was mitigated by pleasing performances from paris 
madrid milan and munich for text 100 the region 
was restructured into two regions and resulted in 
senior staff  being closer to the business and its key 
clients the amsterdam offi  ce is now managed as
 a branch offi  ce of paris and the three nordic offi  ces 
of text 100 are now managed under a unifi ed 
leadership structure the cost of making these 
changes had an impact on margins but has resulted 
in a stronger growthoriented culture and will 
benefi t the business in the coming year
clients become more global
the group has a strong balance between local 
regional and global client wins within the region 
local clients include litex in norway and lg in italy 
new regional clients included mtv kroll ontrack and 
safenet new international client relationships in the 
region include schneider electric a signifi cant us 
client expanding into the nordics the johannesburg 
offi  ce started to work with cisco four years after text 
100 won the account in north america cisco is its 
secondlargest global account europe is also a vital 
region for bite’s global clients hp and amd
clients become more social
europe is no diff erent to the rest of the world in 
the extent to which clients are embracing the need 
to adopt social media practices digital activity is 
becoming integrated into daily client programmes 
rather than being just oneoff  creative executions 
bite gained industry recognition for a campaign it 
ran for nuance and text 100 expanded its social 
media practice and now has a team of six specialists 
across the region
ambitions grow in europe
europe is a key region and the group is investing 
through the bite brand where the region has an 
important role to play in bite’s global network and its 
consistent approach to client experience bite has a 
shortterm plan to build a strong european off er 
based on offi  ces in uk france germany and 
sweden the swedish offi  ce is long established and 
under new leadership is providing strategic counsel 
to leading brands such as warner xerox iomega and 
checkpoint the french business has been launched 
as soundbite communications and already has hp 
and parallels as founding clients the next piece of 
the european jigsaw is germany where a bite offi  ce 
presence is anticipated in 201 1 to complement the 
established text 100 offi  ce
the year ahead
the group has set modest growth expectations 
for the region there is recovery underway but it 
remains fragile and there is anxiety as to how the 
austerity measures imposed by many european 
governments will impact on our large technology 
clients the group expects that a combination of 
a strong client list and a new offi  ce opening will 
generate revenue increases
£9 7 m
revenue
europe and africa
ibm pc tools panasonic
sandisk symantec nxp
lenovo fujitsu safenet
the mathworks vodafone facebook
amd xerox cadence
key clients
18
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   18 13938ra10p0129indd   18 16112010   1217 16112010   1217 nordic appetites 
text 100
se se se e seve ve v v v n n n n ye y ye ye ye year ar ar rs s s ago text 100 in the 
nord rdic ics wa wa wa was represented by a single 
offi offi offi offi   ce ce ce i i in n n s st s ockholm as it became 
ap ap ap ppa p rent that multinational companies 
to a large extent wanted a nordic arena 
text 100 decided to do something 
ab b ab abou ou out t t th th this is is  an an and d d to to toda da d y y th t ere are 30 text 
10 100 0 co cons nsul ulta tant ts s working in this region 
“our clients love this we get more and 
more business opportunities through 
th he e fa fact ct t tha hat t we we c can an o off er a one point of 
co cont ntac act t so solu luti tion on t to o no nord rdic ic m mar arke keti ting ng” ”
sara mönd dell managing director of text 100 in 
the nordics region
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1 9
nex nex nex next f t f t f t ift ift ift ifteen een en een co co co commu mmu mmu mmunic nic nic nicati ati ati a ons ons ons n gr gr gr g oup oup oup oup pl pl p plc c c
ann ann ann nn a ual ual ual ual re re re repor por por o t 2 t 2 t 2 t 2010 010 010 010
13938ra10p0129indd   19 13938ra10p0129indd   19 16112010   1217 16112010   1217 introduction 
asia pacifi c represents one of our biggest 
opportunities but also one of our principal 
management challenges because of the geographic 
and cultural diversity of the region asia pacifi c 
increased its share of group revenue from 1 2 in 
the year ended 31 july 2009 to 14 in the year 
ended 31 july 2010 with a reported growth rate of 
30 this growth came largely from the acquisition 
of upstream asia in late october 2009 see note 26 
which has been integrated into bite but also from 
strong recovery in australia singapore and malaysia 
next fifteen now has 16 offi  ces spread from india in 
the west to china in the north and australia in the 
south plus a further three licensed partners and has 
a mediumterm goal to increase the region’s share 
of group revenue to 20 which will include asean 
markets such as thailand indonesia and vietnam 
as they open up
client activity
both text 100 and bite have an established 
technology strength in the region for example text 
100 helped launch the flip pocket video camera for 
cisco in australia and singapore and in india helped 
to promote a successful visit from yahoo’s carol 
bartz on the more traditional technology front ibm’s 
smarterplanet has been a key thought leadership 
focus in the region and bite has been working to 
promote skype for business mobile and video 
as well as csr activities that took skype into 
the education and healthcare sectors however both 
brands extend beyond technology with clients in 
the automotive consumer food healthcare travel 
and fi nancial sectors which provides a greater scope 
for revenue growth
social media and digital communications
the markets in the region are progressing at diff erent 
speeds in the integration of social media into pr 
campaigns but growth will continue in social 
media networking and infl uencer campaigns as 
the blurring of lines between advertising digital 
and pr continues our businesses ensure that their 
consultants are trained to deliver integrated digital 
programmes bite has also seen demand for 
dedicated social media and digital support and 
so recently acquired digital marketing boutique 
onexeno to help deliver this capability
the year ahead
next fifteen continues to believe in the longterm 
growth prospects in china and the asia pacifi c 
region china is a market in which organic growth 
has been diffi  cult to achieve at a suffi  cient rate to 
improve market share so further acquisition activity 
in this country is under review for the region as a 
whole strong organic revenue growth is expected 
in the current year as the service capability and 
geographic spread continue to open up new 
growth opportunities
operational review continued
£102 m
revenue
asia pacifi c
lenovo symantec nokia 
ibm cisco sandisk 
the mathworks nxp paypal
vmware swift htc
hp motorola sungard
key clients
next fifteen communications group plc
annual report 2010
20
13938ra10p0129indd   20 13938ra10p0129indd   20 16112010   1217 16112010   1217 visit our website 
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taking htc 
beyond ‘quietly 
brilliant’ 
t echnology 
bite
t ta ta ta a t t t iw iw iw w iw w iw w wan an an anb b b b b bas as as as as a d d d ed ed d d ed ed h h h h htc tc tc tc tc tc tc c n n n n n n n nee ee ee ee ee ee e de de de de de de d de d d d d d d d d d d to t c c c c cha ha ha ha ha h ha a a h ll ll ll ll ll l ll len e en e e e e ge e e e e e e e  
ma ma ma ma ma ma main inst st st st st stre re re re re re re re r a am am am am am m am b b b b b b b br r ra ra ra ra and nd nd nd nd nd d nd ds s s s s s s in in n in in in i i in t t t t t t t the he he he he h hei i i ir ir i a app pp pp pp p pp pp p ro ro ro ro ro ro r ac ac ac ac ac c a ac c ch h h h h h h h h to to o  
ho ho ho ho ho ow w w w w w w w co co co co co co ons nsum um um um mer er er er er er r e s s s s s s s s s s pu pu pu pu pu pu pu pu purc rc rcha ha ha hase se se se se a a a a and nd nd nd nd nd n i i i i int nter r er rac ac ac ac ac c ct t t t t 
wi wi wi wi wi wi wi with th th t t t t t t the he he he he eir ir ir ir ir m m m m m m m m mob ob ob b b b o il il il il i i e e e e e e de d de de de e e e evi vi vi vi vi vi v v v ce ce ce ce ce e c s s s s s
bi b bi bi b te te te te te te te e t d d d d d d d d dev ev ev v ev ev ev v vel el el e e e op op p p ped ed ed d ed a a a a a c c c c clo lo lose se e se sely ly ly ly l ly ly ly ly i i i i i i nt nt nt nt nt nt n eg eg eg eg eg eg eg g e ra ra ra ra ra rate te te te te ted d d d d d 
co co co co co o comm mm mm mm mm m m m m un un un un n u un unic ic ic ic c ic c cat at at at at at t at a io io o o ons ns ns ns ns ns s s n n p   pro ro ro ro ro ro o o o ogr gr r r r gr g am am am am am m m m amme me me me m m me me me e e t t t t t t tha h ha ha h ha a ha h h t t t t t t t 
wo wo wo wo wo wo wo wo wo o wo wo o w wo o o oul ul u u ul ul ul ul ul u ul u ul uld d d d d d d d d d d co co co co co o o o o o co ons ns ns ns ns ns ns ns ns s ns nsis i i is is s i i te te te te e e e ent nt nt nt nt t nt nt t nt nt nt nt nt ntly ly ly ly l l ly r r r r r r r re et et et et et et et et et et e et t tel el el el el el el el el el e e ell l l l l l l l th th th h th th th h h h th t th h his is is is is is s s is s is is is s m m m m m m m m m m m m m m mes es e e es es es s es s e es es e es s ssa sa sa sa sa sa a a sa a a a s sa s ge e ge ge ge ge ge ge ge ge ge e g ge ge g ge 
t t t t th th th th t t t t t t t t t th h th h t t ro ro ro ro ro ro ro o ro ro ro o o ro o o ro o o oug ug ug ug ug ug ug ug ug ug ug u ug ug ug ug u ug g g ug g g g gh h h h h h h h h h h h h h h pr pr p pr p pr pr p pr pr pr pr r pr pr pr r pr r r pr pr pr pr pr p p p od od o o o od od od od o o o o o o o o o o u uc u uc uc uc c c c c c uc uc uc uc c uc u uc c c c uc ct t t t t t t t t t t t t t t t t t t t t la la la la l la la l un un un un un un un un un un un n u u un n un n n n n un un unch ch ch ch ch ch ch ch ch ch c c ch h h ch h ch ch ch ch h c c es es es es es es es es es e es es s es es s es s             pr pr pr pr pr pr pr pr pr pr pr pr pr p p p pr p p p p p p od od od od d d d d d d d od d d d d od d od o o od d oduc uc uc uc uc uc uc uc uc uc uc c c uc uc uc uc u u u u u u u uc u u t t t t t t t t 
r re re re re re re re re re e e e e re e e re re re e e e re e e re e revi vi vi vi vi vi v vi vi vi vi i vi v v v vi vi v v v ew ew ew ew ew ew ew ew ew ew ew w w w ew ew w w w ew w ew ew e ew w w ew w w ew ews s s s s s s s s s s s s s s s s s s s s s s s s s s  s s s s e e e e e e e e e e e e e e e e e e e e e ex xe xe x x x x x x x x x x x x x x x x cu cu u u u u u u u u u u u u u u u u u u u uti ti ti ti ti ti ti ti i ti ti ti ti ti ti ti ti t t ti ti t ti ti i i ti t ve ve ve v ve ve ve ve ve ve ve ve ve ve ve v ve ve ve v v ve ve ve ve ve ve e p p p ro o o o o o o o o o o o o o o o o o o o rofi fi fi fi fi fi fi fi fi fi fi fi li li li i li li i i i i i li li l li i li i li i i i li li ing ng ng ng n ng n n n n ng ng ng ng ng ng ng ng ng ng n ng g g ng ng n ng n n ng ng ng g ng n n n ng   th th th th th th h th th th th th th h th th th h th th th th th t ou ou ou ou ou ou ou ou ou u u u u ou u ou ou u ou ou u u u ou o ou ou ou o gh gh gh gh gh gh gh gh gh gh gh gh gh gh gh gh gh gh g g g g gh gh g g gh g g g gh g g gh gh g g g t t t t t t t t t t t t t t t t t
le e e e e le e le e le e le e le le le le e le le le le le le le le l l l le e le le l le e ead ad ad ad ad ad ad ad ad ad ad ad ad ad ad ad ad ad ad d ad a ad ad ad d d ad a ad ad d ad a ad a ad ad a ad a ad ad ad d d der er er e er er er er er er er er er e e er er e e e e er er er er e er r r r r er r e e er e er e e e e e sh sh sh sh sh sh sh sh sh s sh s s sh sh sh s s s s s s sh s sh sh h sh h h h h sh h sh sh s s s ip ip ip ip ip p ip p ip ip ip ip ip ip p ip ip p p   is is is s s s s is s s s s s is is s s s s s s s s s ssu su su su su su su su s su su su su su su su s su s s su su u su su u su su s s s su u ues es es e es es es es es es es s es es es es es es s es e es s s s s s s s s es m m m m m m m m m m m m m m m m m m m m m m m m m m m m m m m m man an an n n an an a an a a a an a anag ag ag ag ag ag ag ag ag a ag ag ag ag ag ag ag g g ag ag ag ag ag ag g g ag ag g g gem em em em em em em em em em em em em m m em m m em em m m m e em em m em em em m em em m m m m e em m m em em m em m m e em m m em m e e en en en en en en en en en en en n n n n en en en en en e e en n en en e e e en n n n n e en e ent t t t t t t t t t t t t t t t t t t t t t t t an an an an an an an n an a an an an an an an an an an an an an an an an an an n n n a a a an a an an and d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d d
s s so so so so so so so so so o o o o o o o o so so so so so so o o o o o s so so so o o o so so o o so s ci ci ci ci ci i i ci ci ci ci ci ci i ci ci ci ci c c c ci ci ci ci cia al al a al al al al a al al al al al a a m m m m m m m m m m m m m m m m m m m m m m med ed ed ed ed ed ed ed ed ed ed ed ed ed ed d ed d d ed ed ed ed ed ed d ed ed d ed d d ed ed ed d d d ed ed d d d e ed d d d dia ia ia ia ia ia ia ia ia ia a i ia ia ia ia ia a ia ia ia ia ia ia ia ia ia i ia ia ia ia ia a ia a a a a a a a a a a a a a a a a a a a a a a a a a a a ac ct ct c c ct ct ct ct c c c c c c c ct tiv iv iv iv iv v iv v v v v iv v iv iv v v v v v i it it it it t it it it it it it it it it i it t t t t t it i it it it it it t t t t t ty y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y y 
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ann ann ann ann ann ann ann ann nn nn an ann ann a a a ann n a a a n an a an an an a a a a a a a a a a a ual ual ua u ua ua al ual l l u ua ual al ual ual a al a ual l a u re re re re re re re re re r re r r r r r r r r re re re re re re re re re re r re re e re re re r re re re re re re re r r r r r r r r r r r r re re r r r re r r r r re e re r re r r r r re r r r re r r r re e re re e re r re re re e r re r r r r r r r r r r r r rep por p po po p p por por po o o por po po po po po por por or p p p p por po po por por o or p p p po po po po o po p p p po po po por por por o por por o o por o p p po por o o or or or o or o or por por o o o or or or o o or or o o or r o o o o o o o o o o p p p p p p p p t t 2 t t 2 t 2 t 2 t 2 t 2 t 2 t 2 2 t 2 2 2 t 2 t 2 t t2 t 2 t2 t 2 t 2 t 2 2 2 2 t 2 2 2 2 2 2 2 t 2 t 2 t t 2 2 2 t2 t 2 t t 2 t 2 2 2 2 2 2 t t t 2 t 2 2 2 2 2 2 t2 t 2 t 2 2 2 2 2 2 2 2 2 2 2 2 2 2 t t 2 2 2 2 2 2 2 t 2 2 2 2 2 2 2 2 2 t 2 t 2 t t 2 2 2 t 2 2 t t 2 20 0 0 01 010 010 01 01 0 01 1 01 01 010 010 010 0 0 010 010 0 0 0 0 01 010 0 01 01 010 10 010 0 0 0 010 10 0 0 01 0 0 010 01 10 010 010 0 0 0 0 0 010 010 0 01 10 01 0 0 01 0 0 0 01 1 0 010 0 010 01 0 010 0 01 10 0 01
21
13938ra10p0129indd   21 13938ra10p0129indd   21 16112010   1217 16112010   1217 overview
the year to 31 july 2010 was a year which started in 
the wake of the world fi nancial crisis but ended with 
an increasing momentum as the group saw more 
encouraging signs of optimism from some of its 
clients fullyear comparisons do not reveal the full 
story as the group experienced little impact from 
the fi nancial crisis until january 2009 the sixth month 
of the comparative period revenue grew by 106 
to £723m 2009 £654m but when adjusting for 
the acquisitions of m booth and upstream asia and 
currency movements underlying activity was down 
55 this reduced underlying activity came in the 
fi rst half of the year and growth returned in the 
second half by 36 there are a number of 
accounting adjustments that distort the underlying 
performance of the group and in this review the 
adjusted profi t and earnings numbers have been 
used adjusted profi t before income tax increased 
by 26 to £66m 2009 £52m see note 5 and the 
adjusted eps rose by 30 to 845p 2009 648p 
see note 10 the group ebitda
1
a a was £84m 
2009 £55m and it generated £51m from operating 
activities after tax 2009 £48m however £51m 
expended on acquisitionrelated payments resulted 
in a group net debt position of £09m compared to 
a positive net funds position of £18m in 2009
2
 
this level of debt represents gearing of only 3 
and still leaves the group with an extremely strong 
base from which to deliver further growth
geographic and client analysis
the group has 48 offi  ces in 1 9 countries and a 
further four licensed partners
during the last year the proportion of the group’s 
revenue outside the uk was 79 us and canada 
remained the largest geographic region accounting 
for almost 52 of revenue including digital and 
research with the uk share of revenue being 21 
the group generated around 73 of its revenue in 
the two strongest markets for public relations and 
marketing services the us and canada pr region 
grew by 1 9 to £363m 2009 £305m following the 
acquisition of m booth which added £7 3m the uk 
pr revenue declined almost 10 on last year but 
when taking the second half over the fi rst half the 
uk pr business grew by 7 5 showing that the 
region is clearly in recovery in calendar year 2010 
in europe and africa the businesses experienced a 
downturn in activity in the year but the stronger 
euro reduced the reported fall in revenue to only 
05 at £97m 2009 £98m the asia pacifi c region 
grew by 30 to £102m 2009 £7 8m thanks to the 
acquisition of upstream asia which added £2m 
stronger currency translation and good results 
posted by our operations in australia malaysia 
and singapore
it is also pleasing to note that the concentration of 
the group’s key clients reduced further the top ten 
clients now represent approximately 32 of the 
revenue of the business 2009 36 with no single 
client accounting for more than 6 of the total 
the group still has an impressive list of global blue 
chip clients with all of the top ten clients generating 
annual fees in excess of £13m
the number of clients rose by 1 7 following the 
acquisitions referenced above but there was a more 
signifi cant 34 rise in the number of project clients
the average client size fell by 6 to £96000 because 
of the increased number of projects but it was 
pleasing to see a 25 increase in the number of 
clients that we represent in more than one country 
these international clients represent 22 of total 
clients but more signifi cantly they are almost three 
times the size of the average client so provide a 
better opportunity for revenue growth
foreign exchange risk
the group has established treasury policies and 
procedures which monitor exposure to the us dollar 
and euro which are the two main operating 
currencies other than sterling following the world 
fi nancial crisis and the sharp movement in currency 
rates the group reassessed its policy on placing 
forward cover the result is that cover periods have 
shortened and cover is now based on the expected 
surplus cash receipts returned to the uk within the 
current fi nancial year only as a result of this policy 
change there should be much reduced volatility in 
the accounting charges arising from the requirement 
to fair value these contracts
financial review
1 
operating profi t before depreciation and amortisation
2  
see net debt analysis in the capital risk management section 
of note 19 of the fi nancial statements
next fifteen communications group plc
annual report 2010
22
13938ra10p0129indd   22 13938ra10p0129indd   22 16112010   1218 16112010   1218 key performance indicators
overview
business review
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financial statements
additional information
next fifteen communications group plc
annual report 2010
23
staff costs to revenue 
688
2009 670
00
10
09
08
07
688
670
673
674
net cash from operating activities £m
£51m
2009 £48m
00
10
09
08
07
51
48
85
52
adjusted profit before income tax 
margin 
91
2009 80
00
10
09
08
07
91
80
104
94
earnings before interest tax 
depreciation and amortisation £m
£84m
2009 £55m
00
10
09
08
07
84
55
74
72
10
asia pacific
09
141
120
revenue by segment 
europe and africa
10
09
135
149
uk
10
09
200
246
us and canada
10
09
501
466
other segments
10
09
23
19
10
asia pacific
09
14
37
adjusted operating profit 
by segment 
europe and africa
10
09
111
106
uk
10
09
214
276
us and canada
10
09
654
578
other segments
10
09
07
03
13938ra10p0129indd   23 13938ra10p0129indd   23 16112010   1218 16112010   1218 margin performance
the adjusted profi t before tax margin of the group 
increased to 91 from 80 last year following the 
recovery and increasing momentum in the second 
half of the fi nancial year excluding head offi  ce costs 
the adjusted operating profi t margin was 1 54 
compared to 167 last year the group’s businesses 
have worked very hard in diffi  cult economic 
circumstances to remain close to the target 
minimum margin threshold of 16 before head 
offi  ce costs the us and uk are operating above 
this level at 201 and 165 respectively but there 
is still much to achieve in some of the smaller and 
less sophisticated markets in the asia pacifi c region 
and in the small nonpr businesses the staff  cost 
to revenue ratio is critical to managing margin 
performance but this increased to 688 2009 
67 0 which is 38 higher than our mediumterm 
target of 65 the main reasons for the increase in 
the year are increased bonus payments in some 
businesses higher share scheme charges for the 
modifi ed longterm incentive plan ‘ltip’ higher 
staff  cost ratios in the acquired upstream asia 
business and salary pressures in some markets 
running ahead of client budgets
cash fl ow
the net cash generated from operations before 
tax payments was strong once again at £66m 
2009 £63m which was 101 of operating profi t 
the main investment activities in the year requiring a 
cash payment were £31m for the initial payment for 
m booth in august 2009 £10m for the purchase of 
the increased 36 stake in 463 communications and 
£07m for the purchase of upstream asia in october 
2009 dividends paid to next fifteen shareholders 
totalled £09m this has undoubtedly been a much 
more diffi  cult year for working capital the group has 
faced pressure on payment terms from some clients 
particularly those fi nanced by debt it would appear 
that they have turned to their suppliers for fi nance 
where bank refi nancing has been more diffi  cult and 
more expensive typically these are large companies 
with professional procurement teams who still 
off er a good credit risk but who unilaterally extend 
payment terms on a take it or leave it basis in the 
face of these pressures the fi nance teams within 
the group have done a great job in managing 
the debtor profi le and bad debt exposure
balance sheet
the key movements in the group’s balance sheet 
are the goodwill arising from the acquisitions of 
m booth and upstream asia and the increased 
receivables and payables consolidated following 
these acquisitions the cash balances were £7 3m 
compared to £7 1m last year with the acquisitions 
largely funded from drawing down £3m from the 
bank facilities described below the net debt 
position after deducting bank borrowings and 
fi nance leases was £09m 2009 £18m net cash 
net assets at 31 july 2010 were £27 6m 
2009 £249m
treasury and funding
the group has a revolvingcredit facility from
barclays bank of £5m until march 201 1 which it 
used to fund the purchases of lexis and outcast 
the facility is available in a combination of sterling 
us dollar and euro at an interest rate of 125 over 
libor in addition the group has a £6m revolving
credit facility with barclays bank repayable in 
december 201 1 to help fund any future acquisitions 
at a rate of 225 over libor of which £26m 
was used to fund the initial consideration for the 
purchase of m booth in august 2009 also available 
is an overdraft facility of £15m available in sterling 
us dollar and euro all of the uk businesses are part 
of a composite accounting system which allows the 
off set of uk overdrawn and credit balances in the 
us the group has consolidated facilities with wells 
fargo supported by a us27m credit line for letters 
of credit and working capital purposes in addition 
wells fargo provided a us1m loan facility at libor 
plus 25 repayable over fi ve years to partly fund 
the purchase of the additional stake in 463 
communications the group aims to return any 
surplus cash to the uk subject to any local transfer 
restrictions and as far as possible to hold only 
moderate nondeposit cash balances in overseas
subsidiaries subject to working capital needs
financial review continued
next fifteen communications group plc
annual report 2010
24
13938ra10p0129indd   24 13938ra10p0129indd   24 16112010   1218 16112010   1218 taxation
the total tax charge for the year is £16m 
2009 £09m on consolidated profi t before tax 
of £53m 2009 £32m this represents an eff ective 
tax rate of 30 being 2 higher than last year 
refl ecting the higher tax rates in the us where an 
increasing proportion of our profi ts are made 
following the acquisition of m booth there were 
also losses in some of the individual entities that 
make up upstream asia the higher tax charge also 
refl ects a decline in the value of our uk deferred tax 
asset as corporate tax rates are set to fall
earnings
basic earnings per share adjusted for the highlighted 
items shown in note 5 rose 30 to 845p see note 
10 this rise refl ects the increased profi t levels but 
was mitigated by the worsening of the tax charge in 
the year and the increased number of shares used 
in the calculation this arises from shares issued in 
relation to the acquisition of a further stake in 463 
communications and also takes into account shares 
issued after the year end in relation to the m booth 
contingent consideration earned during the year 
the calculation is also impacted by shares issued 
from the esop during the year when employees 
exercised share options
the diluted adjusted earnings per share rose by 1 7 
to 7 53p and this is 109 less than the adjusted basic 
fi gure this increased level of dilution is coming from 
the options and performance shares outstanding 
under the ltip  which are now expected to vest 
following modifi cations to the scheme approved by 
shareholders at the agm in january 2010 dilution 
also arises as a result of taking into account shares 
that are expected to be issued in the future as part 
  of the contingent consideration for the m booth 
acquisition made in august 2009
dividends
the proposed fi nal ordinary dividend per share is 
1375p which takes the total for the year to 185p a 
9 increase on the total dividend of 170p last year 
it will be paid on 4 february 201 1 assuming that 
it is approved at the agm on 25 january 201 1 
the board continues to review its dividend policy 
over the medium term and aims to strike a balance 
between the relevance placed on dividends by 
shareholders and the needs of the company to 
invest for future growth
david dewhurst
finance director 
12 november 2010
“ the group has an 
extremely strong 
base from which to 
deliver further 
growth”
overview
business review
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financial statements
additional information
next fifteen communications group plc
annual report 2010
25
13938ra10p0129indd   25 13938ra10p0129indd   25 16112010   1218 16112010   1218 board of directors
1
4
2
3
1 will whitehorn – chairman  
2 tim dyson – chief executive offi  cer  
3 david dewhurst – finance director
4 ian taylor – nonexecutive director
annual report 2010
26
13938ra10p0129indd   26 13938ra10p0129indd   26 16112010   1218 16112010   1218 1 will whitehorn 
chairman 

aged 50
will whitehorn joined virgin group as group public 
relations manager in 1 987  over the following years 
he was responsible for presenting virgin’s joint 
venture strategy and spent several months working 
in japan and began to move into a more general 
management role will worked on the strategy to 
expand the brand into new areas such as fi nancial 
services and telecoms from 1 995 onwards will 
became part of a team developing the virgin
branded venture capital model for global expansion 
in 1 997  he became a director of virgin rail group 
and in 2000 he was appointed brand development 
and corporate aff airs director for virgin in 2004 he 
became president of virgin galactic in 2007  he took 
on that role in an executive capacity and became 
a special adviser to sir richard branson he is also a 
trustee of the virgin unite social entrepreneurship 
and environmental notforprofi t foundation
will is a member of the development board of the 
university of aberdeen in 2007  he was also invited 
to join the advisory board of the british national 
space centre he is also a member of the first
minister of scotland’s ‘globalscot’ business 
mentoring network will was appointed as 
nonexecutive chairman of next fifteen 
communications group plc in january 2004 
and is chairman of the nomination committee
2 tim dyson 
chief executive offi  cer 

aged 49
tim joined the group in 1984 straight from 
loughborough university and became its ceo in 
1992 as one of the early pioneers of tech pr he has 
worked on major corporate and product campaigns 
with such companies as cisco microsoft ibm sun
and intel tim oversaw the fl otation of the company 
on the london stock exchange and has managed 
a string of successful acquisitions by the group 
in recent years including m booth in the us and 
upstream in the asia pacifi c tim moved from 
london to set up the group’s fi rst us business 
in 1995 in seattle and is now based in palo alto 
the heart of silicon valley outside next fifteen 
tim is on the advisory boards of several emerging 
technology companies tim also writes a blog 
at httptimdysonwordpresscom where he 
comments on news and topical issues aff ecting 
the public relations industry 
3 david dewhurst aca 
finance director aged 47
david dewhurst graduated from the university of 
birmingham in 1984 with a bcom degree he then 
joined kpmg peat marwick as a trainee accountant 
qualifying in 1987  david worked as a corporate 
accountant and business analyst for hillsdown 
holdings plc between 1988 and 1990 and was then 
group accountant for premier brands limited one 
of hillsdown’s subsidiaries in 1992 david became 
group finance director for strong  fisher holdings 
plc before being appointed in 1997  to the same 
post at the media business group plc he joined 
the board of next fifteen communications group 
plc as finance director in 1999 to take the company 
through its fl otation in december 1999
4 ian taylor mbe 
nonexecutive director 

aged 65
ian taylor graduated from keele university with a 
degree in economics politics and modern history 
he spent 18 years in investment banking and 
development capital in london and paris before 
being elected as member of parliament for esher 
now esher and walton in 1987  he stood down 
at the 2010 general election
he was minister for science and technology at the 
department of trade and industry from 1994–1997  
during the last conservative administration and 
subsequently chaired or was an offi  cer of several 
allparty parliamentary committees including those 
on science information technology and space 
ian is a director of or adviser to a number of 
companies especially in the technology security 
and communication sectors
he joined the board in 1999 and is chairman 
of the remuneration and audit committees
 member of the audit committee
 member of the remuneration committee
 member of the nomination committee
next fifteen communications group plc
annual report 2010
27
overview
business review
governance
financial statements
additional information
13938ra10p0129indd   27 13938ra10p0129indd   27 16112010   1218 16112010   1218 senior management team
aedhmar hynes – text 100
aedhmar hynes is the ceo of text 100 a global 
communications consultancy that counsels 
companies that use technology as a competitive 
advantage under her leadership text 100 has 
evolved into the creative thoughtpartner of choice 
in public relations and integrated communications 
aedhmar has worked with text 100 for over 20 years 
prior to her appointment as ceo she was regional 
director of text 100’s us operations based in new 
york she is a board member of the council of pr 
firms a trustee of the arthur w page society and 
a member of the aspen institute roundtable on 
technology she also serves as a board director of 
technoserve a nonprofi t organisation dedicated 
to helping entrepreneurial men and women 
build businesses in the developing world in 2008 
aedhmar was voted one of the 25 most powerful 
pr people in the industry by prweek and named k
a henry crown fellow of the aspen institute
clive armitage – bite communications
clive joined the group in 1 990 working in text 100’s 
london offi  ce in 1 994 he was seconded to 
johannesburg south africa to help set up and 
establish text 100’s fi rst presence in africa 
he returned from south africa in 1 995 to help 
cofound bite communications clive became ceo 
of bite communications in 1 998 and subsequently 
moved to san francisco in 2003 to manage the 
acquisition of applied communications and its 
subsequent integration into bite communications 
clive is now based back in bite’s london offi  ce 
where he continues to oversee bite’s international 
growth clive is also the nonexecutive chairman 
of bite’s sister agency lexis pr additionally clive 
is a member of the board of trustees of football 
charity lionsraw
margot raggett – lexis public relations
margot joined lexis in 1 993 as its fi rst graduate 
trainee and rose through the ranks as the company 
grew she instigated and was part of a successful 
management buyout team in 2002 at which point 
she became operations director during her career 
she has advised clients ranging from cocacola 
to domino’s pizza boots to early learning centre 
she has also been integral to the unilever business 
which has grown with lexis over the past six years 
margot became ceo of lexis in august 2007 
caryn marooney – the outcast agency
as cofounder partner and ceo of the outcast 
agency caryn is at the forefront of the 
communications industry’s evolution helping to 
create value in companies of every size from early 
stage onward as they navigate the new world of 
dynamic social media campaigns direct consumer 
and user engagement and emerging markets 
she has worked with several of outcast’s longterm 
clients including vmware for more than seven years 
from early positioning to acquisition to ipo and 
salesforcecom for more than 1 1 years from early 
positioning around ‘the end of software’ through 
a highly successful ipo and more recently to its 
position as a cloud computing leader she works 
with cuttingedge digital clients including amazon 
leading a team that launched the original kindle 
and kindle dx and facebook spearheading 
communications that led the company from 
30 million to more than 500 million users 
caryn has also recently led teams for several 
startups that have gone on to achieve some of 
the most successful tech acquisitions in recent 
years including admob which was acquired by 
googlefor us750m and omniture which was 
acquired by adobe for us15bn 
caryn holds a bachelor’s degree from 
cornell university 
next fifteen communications group plc
annual report 2010
28
13938ra10p0129indd   28 13938ra10p0129indd   28 16112010   1218 16112010   1218 margi booth – m booth
margi booth founded m booth  associates in 1 985 
to create innovative communications programs for 
highly respected consumer lifestyle and corporate 
brands under her leadership the agency’s client 
roster has grown to include american express 
unilever jcpenney hershey’s and ebay among 
others in addition the fi rm was recently named 
2009 creative agency of the year and among the 
ten best places to work in public relations prior to 
founding m booth margi was a vice president at 
ruder finn where she headed up their broadcast 
department she was named one of the 50 most 
powerful women in the pr industry and is a new 
york women in communications matrix award 
recipient for career advancement in public relations 
she is a founding member of the council of 
public relations firms and is a board member 
of the national center for the learning disabilities 
the center for palliative care and the community 
resource exchange
tom galvin – 463 communications
tom galvin’s 20year career has been spent at the 
highest level of both the corporate and political 
arenas prior to founding 463 communications tom 
served as vice president of corporate 
communications and government relations at 
verisign and managed cisco’s corporate public 
relations team in that role tom served as a lead 
strategist on corporate communications initiatives 
and helped brand john chambers as an elite ceo 
tom also spent over a decade as a political journalist 
participating in more than 10000 interviews with 
over 1000 newsmakers – from us presidents and 
other world fi gures to business leaders and 
technology visionaries
david hargreaves – beyond
david joined the group in 2005 following the 
acquisition of his boutique communications 
consultancy credo communications by bite 
prior to setting up credo david was deputy 
managing director at 1 20person technology 
agency firefl y communications 
in may 2008 following a successful twoyear period 
running and growing bite uk winning clients such 
as facebook and linkedin david moved to san 
francisco to run bite north america
in november 2009 david left his fulltime role at 
bite to set up next fifteen’s new digital consultancy 
overseeing the integration of context analytics 
into the new consultancy and then completing 
the acquisition of type 3 to create beyond which 
launched in september 2010
overview
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financial statements
additional information
next fifteen communications group plc
annual report 2010
29
13938ra10p0129indd   29 13938ra10p0129indd   29 16112010   1218 16112010   1218 next fifteen communications group plc
annual report 2010
report of the directors 
 
30  
the directors present their annual report together with the audited financial statements of next fifteen communications group plc 
the ‘company’ and its subsidiaries the ‘group’ for the year ended 31 july 2010  
principal activity 
the principal activity of the group during the year continued to be the provision of public relations services the group’s business 
is organised into four reportable segments being the provision of public relations services in the us and canada uk europe and 
africa and asia pacific within these segments the group operates five independent pr brands that operate as autonomous 
businesses thus enabling them to service competing clients these are text 100 bite the outcast agency lexis public relations 
and m booth  associates inc it also operates a policy communications business 463 communications llc  
other operating segments are research and digital consultancy within these segments the group operates a research business 
redshift research and a digital consultancy beyond 
review of business and future prospects 
a detailed review of the business current trading and future developments of the group is given in the chairman’s statement the 
chief executive officer’s review and the financial review the latter of which includes an overview of the key performance indicators 
of the business details of the group’s principal risks and uncertainties are given in the directors’ statement on corporate 
governance 
results and dividends 
the group’s financial statements for the year ended 31 july 2010 show that profit before tax for the financial year was 
£5304000 2009 £3158000 the group made a profit attributable to shareholders of the company for the year of £3675000 
2009 £1932000 the interim dividend paid during the year was 0475p per share 2009 045p a final dividend of 1375p per 
share 2009 125p has been proposed making the total for the year 185p per share 2009 170p 
company’s listing  
the company continues to be listed on the alternative investment market aim of the london stock exchange 
acquisitions  
on 3 august 2009 the company acquired new yorkbased m booth  associates inc the initial consideration paid on completion 
was us4m further consideration of up to a maximum of us1325m may be payable over the course of the next four years 
subject to the achievement of certain revenue and profit performance targets the total maximum consideration is therefore 
us1725m any contingent consideration that may be payable may be satisfied by cash or up to 25 in the company’s shares 
at the option of the company 
on 27 october 2009 the company acquired the marketing communications trading subsidiaries of upstream marketing and 
communications inc ‘upstream asia’ a hong kongbased company the businesses trade in hong kong singapore australia 
and china and were integrated into bite communications group the initial consideration was us09m paid in cash and the 
assumption of us02m of upstream asia’s liabilities making a total of us11m the company owns 55 of bite asia holdings 
limited the parent company of the acquired upstream asia subsidiaries and asset pioneer limited ‘asset pioneer’ owns the 
residual 45 the company entered into an option deed under which it has an obligation to acquire asset pioneer’s shares over 
a fiveyear period based on the profitability of the acquired businesses  
on 31 october 2009 the company acquired a further 30 stake in 463 communications llc ‘463 communications’ this took the 
company’s total stake to 70 the company paid consideration of us214m in cash and shares of the company 
on 28 may 2010 the company acquired a further 6 stake in 463 communications this took the company’s total stake to 76 
the company paid consideration of us120000 in cash  overview
business review
governance
additional information
next fifteen communications group plc
annual report 2010
financial statements
 
 
31 
financial instruments  
information on both the group’s financial risk management objectives and the group’s policies on exposure to relevant risks in 
respect of financial instruments is set out in note 19 
directors  
the names and biographical details of the directors who held office at the date of this report appear on page 27 
in accordance with the company’s articles of association onethird of the directors must retire by rotation each year 
david dewhurst will retire from the board at the next annual general meeting of the company and offer himself for reelection 
as ian has been a nonexecutive director for eleven years in accordance with good corporate governance he will retire and offer 
himself for reelection every year ian is engaged pursuant to a letter of appointment he continues to be an effective nonexecutive 
director and demonstrates commitment to the role 
additional information relating to directors’ remuneration service agreements and interests in the company’s shares is given in the 
remuneration report 
other than service contracts no director has a material interest in any contract to which the company or any of its subsidiaries is a 
party the company has maintained insurance to cover directors’ and officers’ liabilities and costs for claims in connection with any 
act or omission by its directors or officers in the execution of their duties no claims have been made against this policy  
substantial shareholdings 
on 12 november 2010 the following interests in 3 or more of the issued share capital had been notified to the company 
name 
ordinary shares of 
25p each 
 of ordinary share 
capital 
liontrust asset management 7796465 1405
tim dyson 5781004 1042
herald investment management 5231796 943
blackrock investment management uk 5116482 922
tom lewis 3074538 554
octopus investments 3060122 551
matt ravden 3004294 541
river and mercantile asset management  2723644 491
the market price of the company’s shares during the year was as follows  
price at 1 august 2009 48p
highest price 71p
lowest price 48p
price at 31 july 2010 60p
charitable donations 
during the year the group made charitable donations of £32000 2009 £19000 
political donations 
it is the group’s policy not to make donations for political purposes 
payments to suppliers  
it is the policy of the group to agree suitable terms and conditions for its business transactions with all suppliers these terms and 
conditions range from standard written terms to individually drafted contracts once such terms are agreed it is the group’s policy 
to adhere fully to them provided the supplier has also complied with the terms and conditions the number of days taken by the 
company to pay suppliers on the basis of trade creditors at 31 july 2010 and average daily purchases for the year was 31 days 
2009 28 days  next fifteen communications group plc
annual report 2010
report of the directors continued 
 
32 
employee involvement 
the group operates a policy of regularly informing all employees of the group’s financial performance through a combination 
of meetings and electronic communications in addition the group’s employee share option schemes longterm incentive 
schemes and bonus schemes encourage employees at all levels to contribute to the achievement of the group’s shortterm 
and longterm goals 
equal opportunities 
the group gives full and fair consideration to all applications for employment made by people with disabilities having regard to 
their particular aptitudes and abilities the group’s policies for training career development and promotion do not disadvantage 
such people the group seeks to recruit develop and employ throughout the organisation suitably qualified capable and 
experienced people irrespective of sex age race religion or belief marital or civil partnership status or sexual orientation 
health and safety 
the group recognises and accepts its responsibilities for health safety and the environment the group is committed to 
maintaining a safe and healthy working environment in accordance with applicable requirements at all locations in the uk and 
overseas the finance director is responsible for the implementation of the group policy on health and safety health and safety 
is included on the agenda of every board meeting and all health and safety issues are fully considered 
annual general meeting 
the annual general meeting of the company will be held at the company’s offices at the triangle 517 hammersmith grove 
london w6 0lg on tuesday 25 january 2011 at midday the notice convening the meeting is included in the mailing with this 
annual report for those shareholders who requested a hard copy and is also available on the company’s website at 
wwwnextfifteencom 
subsequent events 
on 4 august 2010 beyond corporation limited acquired the entire issued share capital of ukbased type 3 limited while beyond 
international corporation acquired the entire issued share capital of usbased type 3 limited consideration of £300000 in cash 
was paid on completion the company owns 51 of both beyond corporation limited and beyond international corporation 
together referred to as ‘beyond’ while the residual is owned by three employee shareholders the company has entered into a 
shareholders’ agreement under which the noncontrolling interest holders have the option to sell half of their shareholding back to 
the company in either october 2013 october 2014 or october 2015 based on the profitability of each business the consideration 
is uncapped by october 2015 the company will have acquired half of their shareholding bringing the company’s holding to 755 
on 1 september 2010 lexis public relations limited ‘lexis’ acquired the entire issued share capital of ukbased glasshouse 
partnership limited the initial consideration paid on completion was £80000 contingent consideration may be payable in cash 
and the company’s shares over the course of the next two years subject to the achievement of certain revenue and staff metric 
performance targets 
on 1 september 2010 bite communications hong kong limited acquired the business and assets of onexeno limited a hong 
kong company this business was integrated into bite communications group limited’s asia pacific operations the initial 
consideration paid in cash on completion was hk1105000 with further consideration payable based on the revenue of retained 
clients over the 12 months following completion  
on 1 november 2010 the group acquired an 85 stake in usbased investor relations company the blueshirt group llc 
‘blueshirt’ the initial consideration paid in cash on completion was us3m contingent consideration will be paid over the course 
of four years based on a multiple of average profits and margin performance these contingent payments are estimated to total 
us8m there is an option for the sellers to sell the remaining 15 stake in blueshirt after five years from completion and an option 
for the company to acquire the remaining 15 after six years from completion provided that the value of the business at the 
relevant time has reached a certain level   overview
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governance
additional information
next fifteen communications group plc
annual report 2010
financial statements
 
 
33 
corporate governance  
the company’s statement on corporate governance is set out in pages 40 to 42 of these financial statements and forms part of this 
directors’ report 
additional information for shareholders 
the following information is provided to shareholders as a result of the implementation of the european directive on takeover bids 
200425ec into english law this is a summary only the relevant provisions of the company’s articles of association ‘the 
articles’ and the companies act ‘the act’ should be consulted if further information is required  
share capital 
details of changes in the issued ordinary share capital of the company during the year are set out in note 20 of the financial 
statements  
rights and obligations attached to shares 
the rights attached to the company’s ordinary shares being the only share class of the company are set out in the articles 
subject to the act and applicable law shares may be issued with such rights and restrictions as the company may by ordinary 
resolution determine or if the company has not determined as the board may determine there is currently no applicable 
resolution in effect  
voting rights 
at a general meeting of the company on a show of hands every member present or by proxy shall have one vote on a poll every 
member present in person or by proxy shall have one vote for every share of which he or she is a holder no member may attend 
or vote nor exercise any other rights conferred by being a holder of ordinary shares unless all calls or other sums payable on every 
share held have been paid a member may lose the entitlement to vote at a general meeting where that holder has failed to 
respond to a disclosure notice made by the company under the act with information concerning interests held in those shares  
restriction on transfer of shares 
the directors may refuse provided such refusal does not prevent dealings in the shares of the company from taking place in an 
open and proper manner a transfer of certificated shares unless it is  
i in respect of a share which is fully paid 
ii in respect of a share on which the company has no lien 
iii in respect of only one class of shares 
iv in favour of a single transferee or not more than four joint transferees and 
v duly stamped if required and delivered for registration at the place designated by the board accompanied by the 
certificate of shares and such other evidence of title as may be reasonably required to show the right of the transferor to 
make the transfer 
the board may refuse the registration of a transfer of an uncertificated share in the circumstances set out in the uncertificated 
securities regulations and where in the case of a transfer to joint holders the number of joint holders to whom the uncertificated 
share is to be transferred exceeds four  
dividends 
subject to the provisions of the act the company may by ordinary resolution declare a final dividend to be paid to members 
according to their respective rights and interests in the profits of the company but no such dividend shall exceed the amount 
recommended by the board the board may pay such interim dividends as appear to the board to be justified by the profits of 
the company available for distribution   next fifteen communications group plc
annual report 2010
report of the directors continued 
 
34 
appointment of directors 
directors may be appointed by ordinary resolution or by the board in addition to any power of removal under the act the 
company may by ordinary resolution remove any director before the expiration of his period of office 
power of the directors 
subject to the act the company’s memorandum of association and the articles and to any directions given by special resolution 
of the company the business of the company shall be managed by the board which may exercise all the powers of the company 
whether relating to the management of the business or not  
amendment to the articles 
amendment to the articles may be made by special resolution of the company in general meeting in accordance with the act  
acquisition of the company’s own shares 
the company may purchase its own shares in accordance with the relevant provisions of the act subject to the resolution of the 
shareholders 
any shares which have been bought back may be held as treasury shares or if not so held must be cancelled immediately upon 
completion of the purchase thereby reducing the company’s issued share capital the company has the power to buy back up to 
5488839 during the period up to the next annual general meeting the maximum price per ordinary share which can be paid on 
any occasion is limited to 105 of the average of the middlemarket quotations as derived from the london stock exchange’s daily 
official list for the five business days prior to the date of the purchase being made  
auditors 
all the current directors have taken all the steps that they ought to have taken to make themselves aware of any information 
needed by the group’s auditors for the purpose of their audit and to establish that the auditors are aware of that information 
the directors are not aware of any relevant audit information of which the auditors are unaware 
the auditors bdo llp have indicated a willingness to continue in office and a resolution that they be reappointed will be 
proposed at the forthcoming annual general meeting 
by order of the board 
david dewhurst 
company secretary 
12 november 2010 
  overview
business review
governance
additional information
next fifteen communications group plc
annual report 2010
financial statements
remuneration report 
 
35 
the remuneration committee the ‘committee’ and its role 
for the year ended 31 july 2010 the committee consisted of the company’s two nonexecutive directors ian taylor committee 
chairman and will whitehorn the chief executive attends certain meetings of the committee by invitation to discuss other 
executives’ performance as appropriate during the year the committee received advice from the chief executive in respect of 
the remuneration of the finance director the committee takes professional advice as and when it considers this necessary  
the committee’s principal function is to determine the remuneration packages of the company’s senior executives and executive 
directors and make recommendations to the board concerning the allocation of bonuses and longterm incentive rewards to the 
two executive directors and to senior executives in the group in addition it considers the objectives set for each senior executive 
and how he or she has performed against these targets its key terms of reference are to 
• determine and agree with the board a general policy for the remuneration of the executive directors and senior executives 
• determine the total individual remuneration package of each executive director  
• determine the policy for and scope of pension arrangements for executive directors and 
• determine and approve the longterm performance incentive arrangements for executive directors and senior executives 
of the group 
it takes into consideration the performance of the senior executives and directors and sets the scale and structure of their 
remuneration and the basis of their service agreements with due regard to the interests of shareholders no one may participate in 
decisions regarding his or her own remuneration the committee’s terms of reference are published on the company’s website 
remuneration policy 
the group’s remuneration policy aims are to 
• attract develop motivate and retain at all levels talented people of the calibre required to continue the group’s growth 
and development 
• ensure that key executives are appropriately rewarded for their contribution to the group and 
• encourage the holding of company shares as an effective way of aligning the interests of employees with those of shareholders 
in framing this policy the remuneration committee and the board have given consideration to the provision of the combined 
code on corporate governance and the qca guidelines for smaller quoted companies in arriving at its recommendations the 
committee considers salary surveys covering aim small cap and international pr companies 
remuneration package for executive directors  
the policy for executive directors’ remuneration is to ensure they are fairly rewarded for their individual contribution to the 
group’s performance this is done through a combination of a competitive salary and the opportunity to increase remuneration 
with shortterm and longterm incentives executive remuneration packages are reviewed each year the remuneration package 
for executive directors consists of a basic salary benefits an annual performancerelated bonus pension and participation in 
a longterm incentive plan details for each director are set out below as the chief executive has a large shareholding in the 
company this is also taken into consideration when decisions are made regarding shortterm and longterm incentives for him  
shortterm incentives  
executive directors’ remuneration includes an element of performancerelated pay so that awards can be aligned to improvements 
in shareholders’ value the level of bonuses is entirely at the discretion of the remuneration committee bonuses are based on the 
performance of the group as a whole against budgets and the committee’s assessment of the performance of individuals against 
the personal objectives they have been set  next fifteen communications group plc
annual report 2010
remuneration report continued 
 
36 
longterm incentives 
the remuneration committee recommends the award of share options and performance shares to executive directors and senior 
executives to incentivise and retain them the current plan in place is the next fifteen communications group plc longterm 
incentive plan ‘ltip’ which provides share option and performance share awards to directors and senior employees  
under the terms of the ltip participants are either awarded share options with a grant price equal to the market price on the day 
before the grant date or are awarded performance shares in the company which are released to the participant upon both the 
satisfaction of certain performance conditions and the participant remaining an employee of the group during the year the 
following performance shares were awarded to directors 
name of director number of shares grant date 
end of 
performance 
period 
executive directors   
tim dyson 150000 february 2010 31 july 2013 
david dewhurst 150000 february 2010 31 july 2013 
in october 2008 the company granted performance shares to nonexecutive directors but has not granted any new awards to 
them this year and following consultation with some shareholders will not grant any such awards in the future  
at the next fifteen general meeting held on 26 january 2010 shareholder approval was obtained to modify the performance 
conditions relating to all new awards under the ltip from february 2010 and to apply the changes to grants made in financial years 
ended 31 july 2008 and 31 july 2009 the new performance conditions will be based upon two measures – an adjusted earnings 
per share ‘eps’ measure and a budgeted profit measure the performance shares under the ltip are subject to the following 
new conditions 
• the eps growth of the group must exceed the retail prices index ‘rpi’ by an average of 10 or more per annum over the 
performance period for 50 of the award to vest 
• if there is an average of between 3 and 10 eps growth over rpi per annum over the performance period between 10 
and 50 of the award will vest on a straightline basis 
• if eps does not grow an average of 3 or more over rpi per annum over the performance period the full 50 of the award 
measured by reference to the eps measure will lapse 
• the remaining 50 of an award may vest if the profit of the particular business in which a participant is employed meets its 
budgeted profit before management charges interest and tax targets over the performance period 
• to the extent that the budgeted profit targets are not met for every 1 below budget 5 of an award will lapse on a straight
line basis 
• if a business’ adjusted profit before management charges interest and tax is 10 or more below budget over the performance 
period the full 50 of the award measured by reference to the budgeted profit measure will lapse  
performance will be measured over a period of four consecutive financial years of the group commencing with the financial year 
in which the award was granted the level of vesting will be determined using the best three of the four years’ performance for 
each performance measure 
eps growth will be calculated from the information published in the group’s accounts the awards will vest when the preliminary 
results for the final financial year of the relevant performance period are released  overview
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additional information
next fifteen communications group plc
annual report 2010
financial statements
 
 
37 
various employees and directors still have options that were issued under previous next fifteen executive share option schemes 
under such schemes share options were issued at the market price on the day before the option was granted or on another date 
no more than 30 days prior to the grant date the share options become exercisable on the following dates 
• the first onethird of the total number granted on the third anniversary of the date of granting 
• the second onethird of the total number granted on the fourth anniversary of the date of granting 
• the final onethird of the total number granted on the fifth anniversary of the date of granting 
the share options will lapse on the date of cessation of the participant’s employment with the group or ten years after the date on 
which the options were granted 
for all options granted after 30 november 1999 there is a performance criterion that the options may not be exercised unless the 
group’s eps has over a threeyear period beginning not earlier than the financial year in which the option is granted and ending on 
the financial year preceding the year in which the option is exercised grown by at least 30 options granted before this date did 
not have specific performance criteria share price growth was expected to be derived from eps growth but without a hurdlerate 
for exercise 
for more information on share options and performance shares see note 21 and 22  
directors’ service contracts 
all executive directors have rolling contracts that are terminable on six months’ notice there are no contractual entitlements to 
compensation on termination of the employment of any of the directors other than payment in lieu of notice at the discretion of 
the company the executive directors are allowed to accept appointments and retain payments from sources outside the group 
provided such appointments are approved by the board in writing details of the executive directors’ current service contracts are 
executive director 
date of current 
letter of contract notice period 
tim dyson 1 june 1997 6 months
david dewhurst 7 july 1999 6 months
nonexecutive directors 
the executive directors are responsible for setting the nonexecutive directors’ fees all nonexecutive directors are engaged 
under letters of appointment terminable on three months’ notice at any time owing to his length of service as a nonexecutive 
director ian taylor has a letter of appointment that is renewable by the company annually after each annual general meeting 
nonexecutive directors are not entitled to any pension benefit or any payment in compensation for early termination of their 
appointment details of the date of the current letters of appointment for nonexecutive directors are 
nonexecutive director 
date of current  
letter of contract notice period 
will whitehorn 23 january 2007 3 months
ian taylor 27 january 2010 3 months
  next fifteen communications group plc
annual report 2010
remuneration report continued 
 
38 
directors’ remuneration 
 
salary and  
fees  
2010  
£’000 
performance 
related bonus  
2010  
£’000 
pension 
contributions 
2010 
£’000 
other 
benefits 
2010 
£’000 
gains made 
on exercise of 
share options 
2010 
£’000 
total  
2010  
£’000 
total  
2009  
£’000 
executive 
directors 
    
tim dyson  377 38 38 41 – 494 456 
david dewhurst  185 19 19 3 66 292 219 
nonexecutive 
directors  
    
will whitehorn  104 – – – – 104 104 
ian taylor  39 – – – – 39 39 
directors’ share options 
at 1 august 2009 the following director held options to purchase 25p ordinary shares but these were exercised before 
31 july 2010 
name of director 
unexercised  
options  
at 1 august  
2009 
granted 
during year 
exercised 
during year 
unexercised 
options 
at 31 july 
2010
exercise  
price 
date from  
which exercisable 
david dewhurst 200000 – 200000 – 300p 22102005 
as at 31 july 2010 the following directors held the following performanceshare awards under the ltip over ordinary shares 
of 25p each 
name of director 
number of shares 
at 1 august 
2009 
shares lapsing 
during year 
number of 
shares 
at 31 july 
2010 grant date 
end of 
performance 
period 
executive directors   
david dewhurst 27918 27918 – 18102006 3172009 
 45860– 45860 09112007 3172011 
 80000– 80000 21112008 3172012 
 –– 150000 09022010 3172013 
   
tim dyson – – 150000 09022010 3172013 
   
nonexecutive directors   
will whitehorn 30000 – 30000 22102008 3172012 
ian taylor 30000 – 30000 22102008 3172012 
  overview
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next fifteen communications group plc
annual report 2010
financial statements
 
 
39 
directors’ interests in the shares of next fifteen communications group plc 
the interests of the directors in the share capital of the company at 1 august 2009 and 31 july 2010 are detailed below 
  ordinary shares share options ltip performance shares
 1 august 2009 31 july 2010 1 august 2009 31 july 2010 1 august 2009 31 july 2010
executive directors    
david dewhurst 229438 299438 200000 – 153778 275860
tim dyson 5781004 5781004 – – – 150000
nonexecutive directors    
will whitehorn 1000126 1095126 – – 30000 30000
ian taylor 65000 65000 – – 30000 30000
performance graph 
the following graph illustrates the group’s total shareholder return since 31 july 2005 relative to the ftse media and 
entertainment index 
 
the graph looks at the value by the end of july 2010 of £100 invested in the company compared with £100 invested in the ftse 
media and entertainment index 
on behalf of the board 
ian taylor 
chairman of the remuneration committee 
12 november 2010 
 
  next fifteen communications group plc
annual report 2010
directors’ statement on corporate governance 
 
40 
the board is accountable to the company’s shareholders for good corporate governance the company is committed to high 
standards of corporate governance throughout the group and has adopted appropriate measures for a company of its size 
this report sets out the measures it has taken 
the board  
the board of directors is responsible for the strategic direction investment decisions and effective control of the group 
as tim dyson the chief executive is located in san francisco the board meets mainly by telephone conference at least monthly 
and at other times when required they meet facetoface when possible and aim to do so at least quarterly there is a schedule 
of matters reserved for board approval which is regularly reviewed and includes among other things the group’s annual budget 
establishment of new subsidiaries property leases significant acquisitions or disposals of fixed assets and significant client 
contracts during the year 16 board meetings were held which included five facetoface meetings the others being by telephone 
conference all directors attended all meetings save for will whitehorn who was unable to attend one meeting 
the audit committee and remuneration committee comprise the two nonexecutive directors ian taylor committee chairman 
and will whitehorn the nomination committee comprises will whitehorn committee chairman ian taylor and tim dyson 
there were two remuneration committee meetings and two audit committee meetings during the year and these were attended 
by all members 
prior to each board meeting every member of the board receives an agenda supporting documents and when relevant monthly 
trading results together with a detailed commentary the nonexecutive directors are encouraged to ask for further information 
if necessary 
the nonexecutive directors held meetings during the year without the executives present to discuss among other things the 
performance of the company and that of the executive directors 
chairman and chief executive  
the roles of the chairman and chief executive are separate and clearly defined the chairman will whitehorn is responsible for 
the leadership of the board and the chief executive tim dyson is responsible for managing the group’s operations 
board balance and independence  
there were no changes to the board during the year to 31 july 2010 the board comprises two executive directors tim dyson 
chief executive and david dewhurst finance director there are two nonexecutive directors will whitehorn chairman and 
ian taylor who is the company’s senior independent director biographies of all the directors are set out on page 27 the board 
considers that the current board structure is appropriate and it complies with the qca guidelines for smaller quoted companies 
which permits an independent chairman to be counted as one of the two independent nonexecutive directors the board 
considers that notwithstanding their interests in the shares and performance shares of the company as set out on page 39 the 
nonexecutive directors are independent of the management of the group the longterm incentive plan awards to the non
executive directors in 2008 provide a basis for aligning the interests of the nonexecutive directors with those of the company’s 
shareholders the company has not granted any new performance shares to the nonexecutive directors and will not grant any 
such awards in the future 
the board has considered whether the length of service of ian taylor 11 years has compromised his independence ian taylor 
continues to be an effective director and his long association with the company has provided him with detailed understanding of 
the company’s operations its market and the issues determining its success he constructively challenges recommendations made 
before making decisions the board does not consider his long service as a director to be detrimental to his objectivity and it should 
not raise any concerns about his ability to perform his duties  
appointments to the board 
appointments to the board are the responsibility of the board upon recommendation of the nomination committee there was 
no requirement for a nomination committee meeting during the year  
information and professional development 
the directors have adopted a number of policies and procedures to help them operate effectively these include access to 
independent professional advice appropriate training for new and existing directors is provided where necessary  overview
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next fifteen communications group plc
annual report 2010
financial statements
 
 
41 
reelection of directors 
in accordance with the company’s articles of association onethird of the directors must retire by rotation each year this year 
david dewhurst will retire and be subject to reelection as ian has been a nonexecutive director for 11 years he will in 
accordance with good corporate governance retire and offer himself for reelection every year  
remuneration 
the remuneration report on pages 35 to 39 sets out details of the directors’ remuneration and the work of the remuneration 
committee 
financial reporting 
the statement of the directors’ responsibilities in respect of the financial statements is set out on page 43 the directors have 
reviewed the group’s budget and cash requirements for the year ending 31 july 2011 and considered outline plans for the group 
thereafter the directors are satisfied that the company and the group have adequate resources to continue in operational 
existence for the foreseeable future accordingly they continue to adopt the goingconcern basis in preparing the financial 
statements 
internal control and principal risks  
the directors have responsibility for the system of internal control for the group and for reviewing its effectiveness it is the 
responsibility of management to implement board policies on risk and control the group’s system of internal control is designed 
to manage and reduce rather than eliminate risk 
the board assesses key areas of internal control and risk management and sets policies accordingly at least once a year each of 
the core businesses is given the task of identifying and setting out its own key risks the resulting document must contain a review 
of the extent and likelihood of each risk and the effectiveness of the controls that manage these risks the board also requires the 
businesses to identify and report any significant risks that arise during the year as soon as they arise the audit committee reviews 
the businesses’ risk documents and produces a significantrisks document for the group which is considered and approved by the 
board it identifies ways to manage and control these risks and sets policies accordingly 
the board can therefore confirm that there is a process for identifying evaluating and managing the significant risks facing the 
group it has been in place throughout the year and is uptodate as at the date of approval of these financial statements and is 
regularly reviewed  
the board considers the principal risks and uncertainties facing the group to be 
• employee risk – the ability of the group to continue to recruit new talent and retain existing employees as a public relations 
business the group is very reliant on highly skilled employees who are vital to its success even in the current economic climate 
the competition for this talent is high steps are continually taken to ensure high levels of staff motivation and development 
the group’s hr teams regularly consider the remuneration and benefits offered to employees and seek to ensure all businesses 
provide exciting and challenging career development  
• client risk – the loss of clients unpredictably or for reasons outside the group’s control the loss of significant clients continues to 
be a risk to the group it has successfully reduced its reliance on a few key clients through a process of adding new businesses 
to the group but losing a major client unexpectedly can have a significant impact on resourcing and revenue ensuring a good 
marketing plan and identifying new business opportunities is key to all businesses as is taking all appropriate steps to retain 
existing clients  
• currency risk – as a global business currency fluctuations continue to be a feature of the group’s translated results most of the 
group’s revenue is matched by costs arising in the same currency the company is listed in the uk but makes much of its profit 
outside of the uk the board continues to consider if and when hedging policies should be in place and to take steps to reduce 
this risk where it is considered appropriate ultimately as a global business the group is well placed to take advantage of growth 
opportunities in the other parts of the world  
the board has considered the need for a separate internal audit function but has decided that because of the size of the group this 
function will continue to be carried out by existing finance staff this decision will continue to be reviewed annually  next fifteen communications group plc
annual report 2010
directors’ statement on corporate governance continued 
 
42 
audit committee and auditors  
the audit committee meets periodically and at least twice per year with the external auditors and with other directors and 
management attending by invitation the primary role of the committee is to keep under review the group’s financial reporting 
procedures and financial systems and controls and to ensure the integrity of the financial information reported to shareholders 
its key terms of reference are 
• reviewing the findings of the audit work undertaken by the group’s auditors 
• reviewing the effectiveness of the financial reporting and internal control procedures 
• reviewing the relationship with external auditors and 
• determining the level of the auditors’ fees 
its terms of reference are available on the company’s website at wwwnextfifteencom the independence and objectivity of 
the auditors is considered by the committee on a regular basis the split between audit and nonaudit work for the year is set 
out in note 4 to the financial statements the nonaudit fees were in respect of nonaudit tax services advice on the company’s 
share option and longterm incentive schemes and corporate finance advisory work this work is not considered to affect the 
independence or objectivity of the auditors the committee also receives an annual confirmation of independence from the 
auditors 
environment 
due to the nature of its businesses the board considers that its direct or indirect impact on the environment is minimal and of 
lowrisk however the company still seeks to minimise the environmental impact of its activities and its business practices support 
environmental good practice such as reducing paper wastage through reuse recycling use of electronic communications and 
reducing business travel by replacing facetoface meetings with conference calls 
relations with shareholders 
the company meets regularly with its institutional shareholders and is keen to encourage shareholder participation at the annual 
general meeting at which the chief executive makes a presentation summarising the progress of the group throughout the year 
and invites any questions from attendees proxy votes are disclosed following a show of hands on each resolution shareholders 
were encouraged to submit questions to the board throughout the year which were responded to promptly the company also 
publishes its annual and interim reports on its website as well as the company’s regulatory news announcements and some 
analyst reports the company also adds video clips to its website when it announces its interim and fullyear results to explain 
the results further these measures enable information on the company to reach a greater number of investors and interested 
stakeholders 
the chairman chief executive and finance director regularly attend onetoone meetings with key institutional shareholders after 
the publication of the company’s interim and preliminary results while the other nonexecutive director does not ordinarily attend 
meetings with major shareholders he would do so if requested by the shareholders  overview
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next fifteen communications group plc
annual report 2010
financial statements
statement of directors’ responsibilities 
 
43 
the directors are responsible for preparing the annual report and the financial statements the directors are required to prepare 
the financial statements for the group in accordance with applicable law and international financial reporting standards ifrs as 
adopted by the european union and the rules of the london stock exchange for companies trading securities on the alternative 
investment market the directors have chosen to prepare financial statements for the company in accordance with uk generally 
accepted accounting practice 
international accounting standard 1 requires that financial statements present fairly for each financial period the group’s financial 
position financial performance and cash flows this requires the faithful representation of the effects of transactions other events 
and conditions in accordance with the definitions and recognition criteria for assets liabilities income and expenses set out in the 
international accounting standards board’s ‘framework for the preparation and presentation of financial statements’ in virtually 
all circumstances a fair presentation will be achieved by compliance with all applicable international financial reporting standards 
a fair presentation also requires the directors to 
• consistently select and apply appropriate accounting policies 
• present information including accounting policies in a manner that provides relevant reliable comparable and understandable 
information and 
• provide additional disclosures when compliance with specific requirements in ifrs is insufficient to enable users to understand 
the impact of particular transactions other events and conditions on the entity’s financial position and financial performance 
company law requires the directors to prepare financial statements for each financial year which give a true and fair view of the 
state of affairs of the company and of the profit and loss of the company for that period in preparing these financial statements 
the directors are required to 
• select suitable accounting policies and then apply them consistently 
• prepare the financial statements on the goingconcern basis unless it is inappropriate to presume that the company will 
continue in business 
• make judgements and estimates that are reasonable and prudent 
• state whether applicable accounting standards have been followed subject to any material departures disclosed and explained 
in the financial statements 
the directors are responsible for keeping proper accounting records that are sufficient to show and explain the company’s 
transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure 
that the financial statements comply with the companies act 2006 they are also responsible for safeguarding the assets of the 
company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities  
financial statements are published on the company’s website in accordance with legislation in the united kingdom governing the 
preparation and dissemination of financial statements which may vary from legislation in other jurisdictions the maintenance and 
integrity of the company’s website is the responsibility of the directors the directors’ responsibility also extends to the ongoing 
integrity of the financial statements contained therein 
by order of the board 
david dewhurst 
company secretary 
12 november 2010 
  next fifteen communications group plc
annual report 2010
independent auditors’ report to the members  
of next fifteen communications group plc 
 
44 
we have audited the financial statements of next fifteen communications group plc for the year ended 31july 2010 which 
comprise the consolidated income statement the consolidated statement of comprehensive income the consolidated and 
company balance sheets the consolidated statement of changes in equity the consolidated statement of cash flow the company 
reconciliation of movements in shareholders’ funds and the related notes the financial reporting framework that has been applied 
in the preparation of the group financial statements is applicable law and international financial reporting standards ifrss as 
adopted by the european union the financial reporting framework that has been applied in preparation of the parent company 
financial statements is applicable law and united kingdom accounting standards united kingdom generally accepted 
accounting practice  
this report is made solely to the company’s members as a body in accordance with chapter 3 of part 16 of the companies act 
2006 our audit work has been undertaken so that we might state to the company’s members those matters we are required to 
state to them in an auditor’s report and for no other purpose to the fullest extent permitted by law we do not accept or assume 
responsibility to anyone other than the company and the company’s members as a body for our audit work for this report or for 
the opinions we have formed 
respective responsibilities of directors and auditors 
as explained more fully in the statement of directors’ responsibilities the directors are responsible for the preparation of the 
financial statements and for being satisfied that they give a true and fair view our responsibility is to audit the financial statements 
in accordance with applicable law and international standards on auditing uk and ireland those standards require us to comply 
with the auditing practices board’s apb’s ethical standards for auditors  
scope of the audit of the financial statements 
an audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable 
assurance that the financial statements are free from material misstatement whether caused by fraud or error this includes an 
assessment of whether the accounting policies are appropriate to the group’s and the parent company’s circumstances and have 
been consistently applied and adequately disclosed the reasonableness of significant accounting estimates made by the directors 
and the overall presentation of the financial statements  
opinion on financial statements 
in our opinion  
• the financial statements give a true and fair view of the state of the group’s and the parent company’s affairs as at 31july 2010 
and of the group’s profit for the year then ended 
• the group financial statements have been properly prepared in accordance with ifrss as adopted by the european union 
• the parent company’s financial statements have been properly prepared in accordance with united kingdom generally 
accepted accounting practice and 
• the financial statements have been prepared in accordance with the requirements of the companies act 2006  overview
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next fifteen communications group plc
annual report 2010
financial statements
 
 
45 
opinion on other matters prescribed by the companies act 2006 
in our opinion the information given in the directors’ report for the financial year for which the financial statements are prepared is 
consistent with the financial statements  
matters on which we are required to report by exception 
we have nothing to report in respect of the following matters where the companies act 2006 requires us to report to you if 
in our opinion 
• adequate accounting records have not been kept by the parent company or returns adequate for our audit have not been 
received from branches not visited by us or 
• the parent company financial statements are not in agreement with the accounting records and returns or 
• certain disclosures of directors’ remuneration specified by law are not made or 
• we have not received all the information and explanations we require for our audit 
scott mcnaughton senior statutory auditor 
for and on behalf of bdo llp statutory auditor 
london 
united kingdom 
12 november 2010 
bdo llp is a limited liability partnership registered in england and wales with registered number oc305127 
 
  next fifteen communications group plc
annual report 2010
consolidated income statement  
for the year ended 31 july 2010 
46  
 note 
2010 
£’000 
2010 
£’000
2009  
£’000  
2009  
£’000  
billings 91175 77287 
revenue 2 72328 65394 
staff costs 3 49757 43792  
depreciation 412 1060 1168  
amortisation and impairment 411 878 513  
reorganisation costs 5 – 1950  
other operating charges 14125 14121  
total operating charges 65820 61544 
operating profit 24 6508 3850 
finance expense 6 1310 839 
finance income 7 106 147 
net finance expense 1204 692 
profit before income tax 25 5304 3158 
income tax expense 8 1591 884 
profit for the year 3713 2274 
attributable to   
owners of the parent 3675 1932 
noncontrolling interests 38 342 
 3713 2274 
earnings per share 10  
basic pence 675 367 
diluted pence 602 366 
 
 
  overview
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next fifteen communications group plc
annual report 2010
financial statements
consolidated statement of comprehensive income 
for the year ended 31 july 2010 
47 
 
 
note 
2010  
£’000  
2009 
£’000 
profit for the year  3713 2274
other comprehensive income   
exchange differences on translating foreign operations   665 1540
translation differences on longterm foreign currency intercompany loans  459 140
net investment hedge 19 111 –
other comprehensive income for the year  1013 1680
total comprehensive income for the year   4726 3954
total comprehensive income attributable to   
owners of the parent  4688 3612
noncontrolling interests  38 342
  4726 3954
 
  next fifteen communications group plc
annual report 2010
consolidated balance sheet  
as at 31 july 2010 
48  
 note 
2010 
£’000 
2010 
£’000
2009  
£’000 
2009  
£’000 
assets   
property plant and equipment 12 2269 1949  
intangible assets 11 27111 18441  
deferred tax assets 18 1531 1695  
other receivables 1319 1008 533  
total noncurrent assets 31919 22618 
trade and other receivables 1319 21892 14595  
cash and cash equivalents 19 7296 7130  
corporation tax asset 282 1115  
total current assets 29470 22840 
total assets 61389 45458 
liabilities   
loans and borrowings 19 2852 4922  
deferred tax liabilities 18 73 42  
other payables 1419 56 73  
provisions for other liabilities and charges 15 – 282  
contingent consideration 1719 4232 –  
share purchase obligation 1719 1349 –  
total noncurrent liabilities 8562 5319 
loans and borrowings 19 5181 156  
trade and other payables 1419 17085 13679  
corporation tax liability 475 559  
provisions for other liabilities and charges 15 58 –  
contingent consideration 1719 1880 228  
derivative financial liabilities 19 419 615  
share purchase obligation 1719 150 –  
total current liabilities 25248 15237 
total liabilities 33810 20556 
total net assets 27579 24902 
equity   
share capital 20 1401 1381  
share premium reserve 5575 5157  
merger reserve 3075 3075  
share purchase reserve 1359 –  
foreign currency translation reserve 2014 1349  
other reserves 24 868 1239  
retained earnings 16791 14424  
total equity attributable to owners of the parent 26629 24147 
noncontrolling interests 950 755 
total equity 27579 24902 
these financial statements were approved and authorised by the board on 12 november 2010 
w whitehorn   d dewhurst 
chairman  finance director 
company number 01579589  overview
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next fifteen communications group plc
annual report 2010
financial statements
consolidated statement of changes in equity 
for the year ended 31 july 2010 
49 
 
 
share 
capital 
£’000
share 
premium 
reserve 
£’000
merger
reserve
£’000
share 
purchase
 reserve
1
£’000
foreign
 currency
translation
reserve
2
£’000
other
reserves
3
£’000
retained 
earnings  
£’000 
equity 
attributable 
to owners of 
the parent  
£’000 
non
controlling 
interests  
£’000 
total 
equity 
£’000
at 1 august 2008 1354 5157 2659 1380 191 1167 12960 19392 246 19638
profit for the year – – – – – – 1932 1932 342 2274
other comprehensive income  
for the year – – – – 1540 – 140 1680 – 1680
total comprehensive income  
for the year – – – – 1540 – 2072 3612 342 3954
dividends ––––––900 900 – 900
acquisition of noncontrolling interest – – – – – – – – 264 264
noncontrolling interest on business 
combination ––––––– – 657 657
shares issued on acquisitions 27 – 416 – – – – 443 – 443
movement in share purchase 
obligation –––1380––391 1771 – 1771
movement in relation to sharebased 
payments ––––––57 57 – 57
deferred tax on sharebased payments – – – – – – 7 7 – 7
movement due to esop share  
option exercises – – – – – 19 44 63 – 63
purchase of own shares – – – – – 91 – 91 – 91
noncontrolling interest dividend – – – – – – – – 226 226
revaluation of investment in associate – – – – – – 93 93 – 93
at 31 july 2009 1381 5157 3075 – 1349 1239 14424 24147 755 24902
profit for the year – – – – – – 3675 3675 38 3713
other comprehensive income  
for the year – – – – 665 111 459 1013 – 1013
total comprehensive income  
for the year – – – – 665 111 4134 4688 38 4726
dividends – – – – – – 932 932 – 932
increase in shareholding of subsidiary – – – – – – 1235 1235 361 1596
noncontrolling interest on business 
combination – – – – – – – – 774 774
shares issued on acquisitions 20 418 – – – – – 438 – 438
share purchase obligation arising  
on acquisitions – – – 1359 – – – 1359 – 1359
movement in relation to sharebased 
payments – – – – – – 606 606 – 606
deferred tax on sharebased payments – – – – – – 166 166 – 166
movement due to esop share  
option exercises – – – – – 482 372 110 – 110
noncontrolling interest dividend – – – – – – – – 256 256
at 31 july 2010 1401 5575 3075 1359 2014 868 16791 26629 950 27579
1
the share purchase obligation for the current year relates to 463 communications llc and upstream marketing and communications inc the movement in the prior 
year relates to the settlement of the share purchase obligation of lexis public relations limited in october 2008  
2
the foreign currency translation reserve is used to record exchange differences arising from the translation of financial statements of overseas subsidiaries 
3
other reserves include esop reserve treasury reserve and hedging reserve analysed in note 24   next fifteen communications group plc
annual report 2010
consolidated statement of cash flow 
for the year ended 31 july 2010 
50  
 note 
2010 
£’000 
2010 
£’000
2009  
£’000 
2009  
£’000 
cash flows from operating activities   
profit for the year 3713 2274  
adjustments for   
depreciation 412 1060 1168  
amortisation and impairment 411 878 513  
finance income 7 106 147  
finance expense 6 1310 839  
loss on sale of property plant  
and equipment 4 11 5  
income tax expense 8 1591 884  
sharebased chargecredit 421 606 57  
movement in fair value of forward  
foreign exchange contracts 4 158 325  
net cash inflow from operating activities 
before changes in working capital 8905 5154 
change in trade and other receivables 1006 2999  
change in trade and other payables 1103 2174  
decreaseincrease in provision 15 224 282  
change in working capital 2333 1107 
net cash generated from operations 6572 6261 
income taxes paid 1465 1476 
net cash from operating activities 5107 4785 
cash flows from investing activities   
acquisition of subsidiaries net of cash acquired 26 4076 4448  
acquisition costs 2629 175 101  
acquisition of property plant and equipment 1178 415  
proceeds on disposal of property plant  
and equipment 19 40  
acquisition of intangible assets 302 134  
net movement in longterm cash deposits 475 202  
interest received 7 68 147  
net cash outflow from investing activities 6119 4709 
net cash from operating and  
investing activities 1012 76 
 
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next fifteen communications group plc
annual report 2010
financial statements
consolidated statement of cash flow continued 
for the year ended 31 july 2010 
51 
 note 
2010 
£’000
2010  
£’000 
2009  
£’000 
2009 
£’000 
net cash from operating and  
investing activities 1012  76
cash flows from financing activities   
proceeds from sale of own shares 110 63 
acquisition of own shares 24 – 91 
net movement in bank borrowings  2559 1462 
capital element of finance lease rental repayment 150 225 
interest paid 6 448 489 
profit share paid to noncontrolling interest partners 9 256 226 
dividend paid to shareholders of the parent 9 932 900 
net cash inflowoutflow from financing activities 883  3330
net decrease in cash and cash equivalents 129  3254
cash and cash equivalents at beginning of the year 7130  9525
exchange gains on cash held 295  859
cash and cash equivalents at end of the year 19 7296  7130
  next fifteen communications group plc
annual report 2010
notes to the accounts  
for the year ended 31 july 2010 
52  
1 accounting policies 
the principal accounting policies applied in the preparation of the consolidated financial statements are set out below 
these policies have been consistently applied to all the years presented unless otherwise stated 
a basis of preparation 
the group’s financial statements have been prepared in accordance with international financial reporting standards adopted by 
the european union ‘adopted ifrs’ ifric interpretations and the companies act 2006 applicable to companies reporting under 
ifrss the consolidated financial statements have been prepared using the historical cost convention as modified by financial assets 
and liabilities including derivative financial instruments at fair value through profit and loss 
the segment information for the year ended 31 july 2009 has been restated in line with ifrs 8 operating segments which 
replaces ias 14 to present the segment information based on the internal reporting provided to the chief operating decision 
maker this restatement amends the disclosure of segmental performance and does not have any effect on the group’s overall 
reported results 
b new and amended standards adopted by the group  
ifrs 3 revised business combinations is effective prospectively to business combinations made in the year to 31 july 2010 
the revised standard was applied to the acquisition of m booth  associates inc ‘m booth’ on 3 august 2009 and upstream 
marketing and communications inc ‘upstream asia’ on 27 october 2009 initial consideration paid in cash was recorded at fair 
value at the acquisition date with contingent consideration and share purchase obligation classified as debt to be subsequently 
remeasured through the income statement which would previously have been recognised through equity acquisition costs 
were also expensed rather than being included within the cost of acquisition the group has recognised the noncontrolling 
interest in relation to the upstream asia business combination at its acquisition date fair value rather than the proportionate share 
of net assets  
ias 27 revised consolidated and separate financial statements treats transactions with noncontrolling interests where there is 
no change in control as transactions with equity owners of the group which will no longer result in goodwill or gain and losses 
for purchases from noncontrolling interests the difference between any consideration paid and the relevant share acquired of the 
carrying value of net assets of the subsidiary is recorded in equity the standard also specifies the accounting when control is lost 
which has not occurred in the year any remaining interest in the entity is remeasured to fair value and a gain or loss is recognised 
in profit or loss there have been no transactions whereby an interest in an entity is retained after the loss of control of that entity 
ias 27 revised has been applied to the increased equity acquired in 463 communications llc ‘463 communications’ 
ias 1 revised presentation of financial statements as a result of the application of this amendment the group has elected to 
present two separate statements an income statement and a statement of comprehensive income previously it presented an 
income statement and a statement of recognised income and expense in addition a statement of changes in equity is now 
presented as a primary statement where previously the information was included in a note the amendment does not change 
the recognition or measurement of transactions and balances in the financial statements 
ifrs 8 operating segments operating segments have been reported in a manner consistent with the internal reporting 
provided to the chief operating decision maker comparative information has been restated in line with the revised standard 
the restatement amends the disclosure of segmental performance and does not have any effect on the group’s overall reported 
results the introduction of ifrs 8 has led to disclosure of an additional operating segment ‘other segments’ as detailed in note 2 
the segmental disclosures do not include total segment assets as they are not regularly reported to the chief operating decision 
maker an exemption which has been adopted early following the 2009 iasb improvement project  
no other standard or amendments that have become effective in the year have resulted in a material effect on the group 
c basis of consolidation 
the group’s financial statements consolidate the results of next fifteen communications group plc and all of its subsidiary 
undertakings using the acquisition method of accounting 
subsidiaries are all entities over which the group has the power to govern the financial and operating policies generally 
accompanying a shareholding of more than one half of the voting rights the existence and effect of potential voting rights 
that are currently exercisable or convertible are considered when assessing whether the group controls another entity  overview
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next fifteen communications group plc
annual report 2010
financial statements
 
 
53 
1 accounting policies continued 
c basis of consolidation continued 
in the consolidated balance sheet the acquiree’s identifiable assets liabilities and contingent liabilities are initially recognised at 
their fair values at the acquisition date the results of acquired operations are included in the consolidated income statement from 
the date on which control is obtained  
where the group obtains and recognises the power to govern the financial and operating policies of an associate undertaking 
the associate becomes a subsidiary the assets liabilities contingent liabilities and results are accounted for in line with subsidiary 
accounting discussed above effective from the date in which control is recognised the acquisition date control can be gained 
where the right to purchase the majority shareholding exists whether or not that right is exercised where the recognition of 
control is accompanied with a purchase of a shareholding in the now subsidiary goodwill is calculated at the acquisition date 
all acquisition costs are expensed  
noncontrolling interests in the net assets of consolidated subsidiaries are identified separately from the parent’s ownership 
interests in them on an acquisitionbyacquisition basis the group recognises any noncontrolling interest in the acquiree 
either at fair value or at the noncontrolling interest’s proportionate share of the acquiree’s net assets noncontrolling interests 
are subsequently measured as the amount of those noncontrolling interests at the date of the original combination and the 
noncontrolling interest’s share of changes in equity since the date of the combination  
intercompany transactions balances and unrealised gains on transactions between group companies next fifteen 
communications group plc and its subsidiaries are eliminated unrealised losses are also eliminated unless the transaction 
provides evidence of an impairment of the asset transferred accounting policies for subsidiaries have been changed where 
necessary to ensure consistency with the policies adopted by the group 
d merger reserve 
where the conditions set out in section 131 of the companies act 1985 section 612 of the companies act 2006 after 
1 october 2009 are met shares issued as part of the consideration in a business combination are measured at their fair value in 
the consolidated balance sheet and the difference between the nominal value and fair value of the shares issued is recognised 
in the merger reserve 
e revenue 
billings represents amounts receivable from clients exclusive of vat sales taxes and trade discounts in respect of charges for fees 
commission and rechargeable expenses incurred on behalf of clients 
revenue is billings less amounts payable on behalf of clients to external suppliers where they are retained to perform part 
of a specific client project or service and represents fees commissions and markups on rechargeable expenses revenue is 
recognised on the following basis 
• retainer and other nonretainer fees are recognised as the services are performed in accordance with the terms of the 
contractual arrangement 
• project fees are recognised on a percentage of completion basis as contract activity progresses if the final outcome can be 
assessed with reasonable certainty the stage of completion is generally measured on the basis of the services performed 
to date as a percentage of the total services to be performed 
• expenses are recharged to clients at cost plus an agreed markup when the services are performed 
f intangible assets 
goodwill goodwill represents the excess of the fair value of consideration payable the amount of any noncontrolling interest in the 
acquiree and acquisition date fair value of any previous equity interest in the acquiree over the fair value of the group’s share of the 
identifiable net assets acquired the fair value of consideration payable includes assets transferred liabilities assumed and equity 
instruments issued the amount relating to the noncontrolling interest is measured on a transactionbytransaction basis at either 
fair value or the noncontrolling interest’s proportionate share of net assets acquired goodwill is capitalised as an intangible asset 
with any impairment in carrying value being charged to the consolidated income statement   next fifteen communications group plc
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notes to the accounts continued 
 
54  
1 accounting policies continued 
f intangible assets continued 
software licences for software that are not integral to the functioning of a computer are capitalised as intangible assets 
costs that are directly associated with the production of identifiable and unique software products controlled by the group 
and that are expected to generate economic benefits exceeding costs beyond one year are recognised as intangible assets 
direct costs include software development employee costs 
amortisation is provided on software at rates calculated to write off the cost less estimated residual value of each asset evenly 
over its expected useful life of five to seven years  
no amortisation is charged on assets in the course of construction until they are available for operational use in the business 
capitalised computer software that is not an asset in the course of construction is amortised on a straightline basis over its useful 
economic life costs associated with maintaining computer software programmes are recognised as an expense as incurred 
trade names trade names acquired in a business combination are recognised at fair value at the acquisition date trade names 
have a finite useful life and are carried at costs less accumulated amortisation amortisation is calculated using the straightline 
method to allocate the cost of trade names over their estimated useful lives of 20 years 
customer relationships contractual customer relationships acquired in a business combination are recognised at fair value at 
the acquisition date the contractual customer relationships have a finite useful life and are carried at cost less accumulated 
amortisation amortisation is calculated using the straightline method over the expected life of the customer relationship 
of three to five years 
g property plant and equipment 
property plant and equipment is stated at cost net of depreciation depreciation is provided on all property plant and 
equipment at annual rates calculated to write off the cost less estimated residual value of each asset evenly over its expected 
useful life as follows 
short leasehold improvements – over the term of the lease or until the first break clause 
office equipment  – 20 – 50 per annum straightline 
office furniture – 20 per annum straightline 
motor vehicles – 25 per annum straightline 
h impairment 
impairment tests on goodwill are undertaken annually at the financial year end other nonfinancial assets including investments 
in associates but excluding deferred tax are subject to impairment tests whenever events or changes in circumstances indicate 
that their carrying amount may not be recoverable 
where the carrying value of an asset exceeds its recoverable amount which is measured as the higher of value in use and fair value 
less costs to sell the asset is impaired accordingly 
where it is not possible to estimate the recoverable amount of an individual asset the impairment test is carried out on the asset’s 
cashgenerating unit defined as the lowest group of assets in which the asset belongs for which there are separately identifiable 
cash flows goodwill is allocated on initial recognition to each of the group’s cashgenerating units that are expected to benefit 
from the synergies of the combination giving rise to the goodwill 
impairment charges are included within amortisation in the consolidated income statement except to the extent they reverse 
gains previously recognised in the consolidated statement of recognised income and expense an impairment loss recognised for 
goodwill is not reversed  overview
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additional information
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financial statements
 
 
55 
1 accounting policies continued 
i foreign currency 
transactions entered into by group entities in a currency other than the currency of the primary economic environment in which 
they operate their ‘functional currency’ are recorded at the exchange rates ruling when the transactions occur foreign currency 
monetary assets and liabilities are translated at the exchange rates ruling at the balance sheet date exchange differences arising 
on the retranslation of unsettled monetary assets and liabilities are recognised immediately in the income statement 
foreign exchange movements on intercompany loans with indefinite terms and for which there is no expectation of a 
demand for repayment are recognised directly in equity  
on consolidation the results of overseas operations are translated into sterling at the average exchange rates for the accounting 
period all assets and liabilities of overseas operations including goodwill arising on the acquisition of those operations are 
translated at the exchange rates ruling at the balance sheet date exchange differences arising on translating the opening net assets 
at opening rates and the results of overseas operations at average rates are recognised directly in the foreign currency translation 
reserve within equity the effective portion arising on the retranslation of foreign currency borrowings which are designated as a 
qualifying hedge is recognised within equity see hedging activities for more detail  
on disposal of a foreign operation the cumulative translation differences recognised in the foreign currency translation reserve 
relating to that operation up to the date of disposal are transferred to the consolidated income statement as part of the profit or 
loss on disposal 
j operating segments 
operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision 
maker the chief operating decision maker who is responsible for allocating resources and assessing performance of the operating 
segments has been identified as the board of directors  
k financial instruments 
financial assets and liabilities are recognised on the group’s balance sheet when the group becomes party to the contractual 
provisions of the asset or liability the group’s accounting policies for different types of financial asset and liability are described 
below 
trade receivables trade receivables are initially recognised at fair value and will subsequently be measured at amortised cost less 
allowances for impairment an allowance for impairment of trade receivables is established when there is objective evidence 
such as significant financial difficulties on the part of the counterparty or default or significant delay in payment that the group 
will not be able to collect all amounts due according to the original terms of the receivables the amount of the allowance is the 
difference between the asset’s carrying amount and the present value of estimated future cash flows associated with the impaired 
receivable such provisions are recorded in a separate allowance account with the loss being recognised as an expense in the other 
operating charges line in the consolidated income statement on confirmation that the trade receivable will not be collectable the 
gross carrying value is written off against the associated allowance 
cash and cash equivalents cash and cash equivalents comprise cash in hand and shortterm call deposits held with banks 
bank overdrafts are shown within loans and borrowings in current liabilities on the consolidated balance sheet except where there 
is a pooling arrangement with a bank that allows them to be offset against cash balances in such cases the net cash balance will 
be shown within cash and cash equivalents in the consolidated balance sheet 
derivative financial instruments derivative financial instruments utilised by the group are protection contracts on us dollar interest 
rate contracts capandcollar and us dollar and euro foreign exchange contracts derivative financial instruments are initially 
recognised at fair value at the contract date and continue to be stated at fair value at the balance sheet date with gains and losses 
on revaluation being recognised immediately in the consolidated income statement the fair value of derivative financial liabilities 
is determined by reference to third party market valuations  
hedging activities the group documents at the inception of the transaction the relationship between hedging instruments and 
hedged items as well as its risk management objectives and strategy for undertaking various hedging transactions the group 
also documents its assessment both at hedge inception and on an ongoing basis of whether the hedging instruments used in 
hedging transactions are highly effective in offsetting changes in fair values of hedged items   next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
56  
1 accounting policies continued 
k financial instruments continued 
where a foreign currency loan is designated as a qualifying hedge of the foreign exchange exposure arising on retranslation of 
the net assets of a foreign operation any gain or loss on the hedging instrument relating to the effective portion of the hedge is 
recognised in other comprehensive income so as to offset the foreign exchange differences arising on the retranslation of the 
foreign operation’s net assets the gain or loss relating to the ineffective portion is recognised immediately in the income statement 
within finance incomeexpense  
gains and losses accumulated in equity on retranslation of the foreign currency loan are recycled through the income statement 
when the foreign operation is partially disposed of or sold at this point the cumulative foreign exchange differences arising on the 
retranslation of the net assets of the foreign operation are similarly recycled through the income statement where the hedging 
relationship ceases to qualify for hedge accounting the cumulative gains and losses remain within the foreign currency translation 
reserve until control of the foreign operation is lost subsequent gains and losses on the hedging instrument are recognised in the 
income statement where there is a change in the ownership interest without effecting control the exchange differences are 
adjusted within reserves  
bank borrowings interestbearing bank loans and overdrafts are recognised at their fair value net of direct issue costs and thereafter 
at amortised cost finance costs are charged to the consolidated income statement over the term of the debt so that the amount 
charged is at a constant rate on the carrying amount finance costs include issue costs which are initially recognised as a reduction 
in the proceeds of the associated capital instrument and unwound over the term of the debt 
share purchase obligation put option agreements that allow the group’s equity partners to require the group to purchase the 
noncontrolling interest are recorded in the balance sheet as liabilities on initial recognition the liability is measured at the present 
value of the ultimate expected payment with the corresponding debit included in the share purchase reserve subsequent 
movements in the present value of the ultimate expected payment are recognised in the consolidated income statement 
trade payables trade payables are initially recognised at fair value and thereafter at amortised cost 
l provisions for other liabilities and charges  
provisions are recognised when the group has a present obligation as a result of a past event and it is probable that the group 
will be required to settle that obligation and are discounted to present value where the effect is material 
provisions are created for vacant or sublet properties when the group has a legal obligation for future expenditure in relation 
to onerous leases the provision is measured at the present value of management’s best estimate of the expenditure required 
to settle the present obligation at the balance sheet date 
m retirement benefits 
pension costs which relate to payments made by the group to employees’ own defined contribution pension plans are charged 
to the consolidated income statement as incurred 
n sharebased payments 
the group issues equitysettled sharebased payments to certain employees the sharebased payments are measured at fair 
value at the date of the grant and expensed on a straightline basis over the vesting period the cumulative expense is adjusted 
for failure to achieve nonmarket performance vesting conditions 
fair value is measured by use of the blackscholes model on the grounds that there are no marketrelated vesting conditions 
the expected life used in the model has been adjusted based on the board’s best estimate for the effects of nontransferability 
exercise restrictions and behavioural considerations  overview
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next fifteen communications group plc
annual report 2010
financial statements
 
 
57 
1 accounting policies continued 
o leased assets 
where substantially all of the risks and rewards incidental to ownership of a leased asset have been transferred to the group 
a ‘finance lease’ the asset is treated as if it had been purchased outright the amount initially recognised as an asset is the 
lower of the fair value of the leased asset and the present value of the minimum lease payments payable over the term of the 
lease the corresponding lease commitment is shown as a liability lease payments are analysed between capital and interest 
the interest element is charged to the consolidated income statement over the period of the lease and is calculated so that it 
represents a constant proportion of the lease liability the capital element reduces the balance owed to the lessor 
where substantially all of the risks and rewards incidental to ownership are not transferred to the group an ‘operating lease’ 
the total rentals payable under the lease are charged to the consolidated income statement on a straightline basis over the 
lease term the aggregate benefit of lease incentives is recognised as a reduction to the rental expense over the lease term 
on a straightline basis 
the land and buildings elements of property leases are considered separately for the purposes of lease classification 
where group assets are leased out under operating leases with the group acting as lessor the asset is included in the balance 
sheet and lease income is recognised over the term of the lease on a straightline basis  
p deferred taxation 
deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the balance sheet differs from 
its tax base except for differences arising on 
• the initial recognition of goodwill 
• the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the 
transaction affects neither accounting nor taxable profit and 
• investments in subsidiaries and jointly controlled entities where the group is able to control the timing of the reversal 
of the difference and it is probable that the difference will not reverse in the foreseeable future 
recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be available against 
which the asset can be utilised 
the amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted by the balance 
sheet date and are expected to apply when the deferred tax liabilitiesassets are settledrecovered 
deferred tax assets and liabilities are offset when the group has a legally enforceable right to offset current tax assets and liabilities 
and the deferred tax assets and liabilities relate to taxes levied by the same tax authority on either 
• the same taxable group company or 
• different group entities which intend either to settle current tax assets and liabilities on a net basis or to realise the assets and 
settle the liabilities simultaneously in each future period in which significant amounts of deferred tax assets or liabilities are 
expected to be settled or recovered 
where a temporary difference arises between the tax base of employee share options and their carrying value a deferred 
tax asset should arise to the extent the future tax deduction exceeds the related cumulative ifrs 2 sharebased payments ‘ifrs 2’ 
expense the excess of the associated deferred tax balance is recognised directly in equity to the extent the future tax deduction 
matches the cumulative ifrs 2 expense the associated deferred tax balance is recognised in the consolidated income statement 
q dividends 
equity dividends are recognised when they become legally payable interim equity dividends are recognised when paid 
final equity dividends are recognised when approved by the shareholders at an annual general meeting  next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
58  
1 accounting policies continued 
r employee share ownership plan esop 
as the group is deemed to have control of its esop trust the trust is treated as a subsidiary and consolidated for the purposes of the 
group accounts the esop’s assets other than investments in the company’s shares liabilities income and expenses are included 
on a linebyline basis in the group financial statements the esop’s investment in the group’s shares is deducted from equity in 
the consolidated balance sheet as if they were treasury shares and presented in the esop reserve 
s treasury shares 
when the group reacquires its own equity instruments those instruments treasury shares are deducted from equity no gain or loss is 
recognised in the consolidated income statement on the purchase sale issue or cancellation of the group’s treasury shares such treasury 
shares may be acquired and held by other members of the group consideration paid or received is recognised directly in equity 
t significant estimates and judgements 
the preparation of the consolidated financial statements requires the group to make certain estimates and assumptions that 
have an impact on the application of the policies and amounts reported in the consolidated financial statements estimates and 
judgements are evaluated based on historical experiences and expected outcomes and are believed to be reasonable at the time 
such estimates and judgements are made although actual experience may vary from these estimates 
i impairment of goodwill in line with las 36 impairment of assets the group is required to test the carrying value of goodwill 
at least annually for impairment as part of this review process the recoverable amount of the goodwill is determined using 
valueinuse calculations which requires estimates of future cash flows and as such is subject to estimates and assumptions 
further details are contained in note 11 
ii taxation the group is subject to income tax in numerous jurisdictions and significant judgement is required in determining the 
provision for income taxes the group recognises assetsliabilities for anticipated tax issues based on estimates of the tax treatment 
where the final tax outcome is different from the amounts that were initially recorded such differences will impact the income tax 
and deferred tax provisions 
the group has provided in full for what it considers to be the likely outcome of ongoing overseas tax litigation based on the 
evidence available at the present time in the event that the overseas tax litigation is resolved in the group’s favour there will be 
a material credit to the group’s income statement tax charge in a future accounting period  
iii contingent consideration share purchase obligation and valuation of put options contingent consideration and share purchase 
obligation relating to acquisitions has been included based on discounted management estimates of the most likely outcome 
the difference between the fair value of the liabilities and the actual amounts payable is charged to the income statement as 
notional finance costs over the life of the associated liability where the agreement gives rise to an obligation that is settled by the 
delivery of a variable number of shares to meet a monetary defined liability these amounts are disclosed as debt changes in the 
estimates of contingent consideration payable and the share purchase obligation is recognised in finance incomeexpense  
u new standards and amendments not applied standards interpretations and amendments to existing standards that have been 
published as mandatory for later accounting periods but are not yet effective and have not been adopted early by the group are as follows 
ias 24 related party transactions effective for accounting periods beginning on or after 1 january 2011 clarifies and simplifies the 
definition of a related party 
ifrs 9 financial instruments will eventually replace ias 39 in its entirety ifrs 9 as issued on 12 november 2009 effective for accounting 
periods beginning on or after 1 january 2013 addresses the classification and measurement of financial assets classification of a financial 
asset is on the basis of an entity’s business model for managing them and the contractual cashflows characteristic of the asset ifrs 9 
outlines the conditions to measure a financial asset at amortised cost and subsequent measurement at amortised cost or fair value as well 
as subsequent reclassification between categories the held to maturity and available for sale classifications have been eliminated ifrs 9 
requires that changes in the fair value of financial liabilities designated as at fair value through profit or loss which relate to changes in own 
credit risk should generally be recognised directly in other comprehensive income  
all other standards interpretations and amendments to existing standards published as mandatory for this accounting periods or 
later accounting period would not have a material effect   overview
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additional information
next fifteen communications group plc
annual report 2010
financial statements
 
 
59 
2 segment information 
description of the types of services from which each reportable segment derives its revenues 
the board of directors has identified the operating segments based on the reports it reviews as the chief operating decision maker 
to make strategic decisions assess performance and allocate resources  
the main activity of the group is the provision of public relations services in key regions across the globe other operating segments 
are research and digital consultancy  
the group’s business is organised into four reportable segments being the provision of public relations services in the uk 
europe and africa us and canada and asia pacific within these segments the group operates a number of separate competing 
businesses in order to offer services to clients in a confidential manner where otherwise there may be issues of conflict 
measurement of operating segment profit  
the board of directors assesses the performance of the operating segments based on a measure of adjusted operating profit 
before reorganisation costs and intercompany recharges which reflects the internal reporting measure used by the board of 
directors this measurement basis excludes the effects of nonrecurring charges such as movement in fair value of financial 
instruments unwinding of the discount on contingent and deferred consideration unwinding of the discount on the share 
purchase obligation amortisation of acquired intangibles and goodwill impairment charges other information provided to 
them is measured in a manner consistent with that in the financial statements  
head office costs relate to group costs before allocation of intercompany charges to the operating segments  
intersegment transactions have not been separately disclosed as they are not material the board of directors does not review 
the assets and liabilities of the group on a segmental basis and therefore this is not separately disclosed  
segmental information for the year ended 31 july 2009 has been restated as a result of the change in accounting policy as 
explained in note 1 
 uk pr
europe and 
africa pr
us and 
canada pr
asia pacific 
pr
other 
segments head office total
£’000   
year ended 31 july 2010   
revenue 14484 9723 36261 10208 1652 – 72328
   
segment adjusted operating profit 2385 1237 7296 154 73 4153 6992
   
year ended 31 july 2009 restated   
revenue 16055 9774 30456 7843 1266 – 65394
   
segment adjusted operating profit 3012 1156 6308 405 35 5186 5730
  next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
60  
2 segment information continued 
a reconciliation of segment adjusted operating profit to profit before income tax is provided as follows 
 
2010  
£’000  
2009  
£’000 
segment adjusted operating profit   
reportable segments  11072 10881 
other segments 73 35 
head office 4153 5186 
 6992 5730 
reorganisation costs – 1950 
goodwill impairment charge 116 116 
amortisation of acquired intangibles 526 139 
movement in fair value of forward foreign exchange contracts 158 325 
total operating profit 6508 3850 
unwinding of discount on contingent and deferred consideration  659 61 
unwinding of discount on share purchase obligation  140 34 
change in estimate of future contingent consideration payable 63 – 
movement in fair value of interest rate capandcollar contract 38 255 
other finance expense 448 489 
other finance income 68 147 
profit before income tax 5304 3158 
3 employee information 
 
2010  
£’000 
2009 
£’000 
staff costs for all employees including directors consist of   
wages and salaries 44414 39011 
social security costs 3673 3713 
pension costs 1064 1125 
sharebased payment chargecredit 606 57 
 49757 43792 
 
 
2010  
number 
2009  
number 
the average number of employees during the year by geographical location was as follows   
uk 165 201 
europe and africa 95 115 
us and canada 309 278 
asia pacific 267 232 
head office 18 21 
 854 847 
details of directors’ remuneration are set out in the remuneration report  
the sharebased payment charge recognised in relation to directors for the year ended 31 july 2010 is £34000 2009 £9000 credit 
  overview
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annual report 2010
financial statements
 
 
61 
4 operating profit 
 
2010  
£’000  
2009
£’000 
this is arrived at after chargingcrediting  
depreciation of owned property plant and equipment 1045 1130
depreciation of assets held under finance leases 15 38
amortisation and impairment of intangible assets 878 513
reorganisation costs – 1950
loss on sale of property plant and equipment 11 5
movement in fair value of forward foreign exchange contracts 158 325
defined contribution pension cost 1064 1124
sharebased payment chargecredit 606 57
operating lease income 198 63
operating lease rentals – property 4502 3940
  – plant and machinery 196 180
foreign exchange loss 504 1432
fees payable to group auditors 436 508
auditors’ remuneration 
during the year the group including its overseas subsidiaries obtained the following services from the company’s auditors and 
its associates 
 
2010  
£’000 
2009
£’000 
fees payable to the company’s auditor for the statutory audit  
of the company’s and consolidated annual statements 95 88
other services  
the auditing of financial statements of the subsidiaries pursuant to legislation 245 187
other services pursuant to legislation 5 5
tax services 61 79
other services 30 149
 436 508
  next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
62  
5 reconciliation of pro forma financial measures 
 
2010  
£’000  
2009  
£’000 
profit before income tax 5304 3158 
movement in fair value of interest rate capandcollar contract
1
 38 255 
movement in fair value of forward foreign exchange contracts
2
 158 325 
reorganisation costs
3
 – 1950 
unwinding of discount on contingent and deferred consideration
4
 659 61 
unwinding of discount on share purchase obligation
5
 140 34 
change in estimate of future contingent consideration payable
6
 63 – 
impairment charge
7
 116 116 
amortisation of acquired intangibles
8
 526 – 
adjusted profit before income tax 6612 5249 
adjusted profit before income tax has been presented to provide additional information which may be useful to the reader and for 
the performance calculation of the adjusted earnings per share used for the vesting of employee share options and performance 
shares  
1
interest rate capandcollar contracts held by the group are recognised at fair value on the balance sheet at each reporting date and the movement on such contracts is 
recognised within finance incomeexpense in the income statement these financial instruments comprise financial products used to manage the interest rate risks of the 
group’s longterm debt obligations the movement in fair value of the interest rate capandcollar contract since 31 july 2009 is a credit of £38000 2009 charge of 
£255000  
2
forward foreign exchange contracts held by the group are recognised at fair value on the balance sheet at each reporting date and the movement on such contracts is 
recognised within operating expenses in the income statement these financial instruments comprise financial products used for hedging currency exposure on us dollar 
and euro the movement in fair value of the forward foreign exchange contracts since 31 july 2009 is a credit of £158000 2009 credit of £325000 
3
reorganisation costs in the year to 31 july 2010 are not considered significant the reorganisation costs of £1950000 in 2009 related to redundancies across the group 
the closure of the text 100 seattle office and the costs associated with the merger of inferno communications limited into bite communications limited ‘bite’ on 
1 may 2009  
4
a finance expense of £645000 has been recognised during the year in relation to the unwinding of the discount on the contingent consideration payable for m booth a 
wholly owned subsidiary of the group since august 2009 and £14000 in relation to the unwinding of the discount on the deferred consideration payable for the outcast 
agency ‘outcast’ a wholly owned subsidiary of the group since june 2005 2009 in relation to outcast only the final deferred consideration payment for outcast was 
made in october 2009  
5
a finance expense of £140000 has been recognised during the year in relation to the unwinding of the discount on the share purchase obligation for upstream asia 
£92000 and 463 communications £48000 2009 in relation to lexis public relations limited only  
6
a finance expense of £63000 has been recognised during the year in relation to a change in the estimate of the contingent consideration payable for m booth  
7
the carrying value of goodwill is reviewed for impairment annually or more frequently if events or changes in circumstances indicate impairment an impairment charge 
has been made for the goodwill recognised by bite on acquisition of credo communications limited ‘credo’ on 31 december 2005 the operations were transferred 
into bite and as a result the decision has been made to write down the goodwill by £116000 as a result of this write down the credo goodwill is now fully impaired 
8
a total amortisation of acquired intangibles charge of £526000 has been recognised in the year in relation to m booth £334000 463 communications £125000 aimpr 
public relations ab £38000 and upstream asia £29000 these are significant noncash charges which arise as a result of acquisitions and were not considered 
significant in the year to 31 july 2009   overview
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financial statements
 
 
63 
6 finance expense 
 
2010  
£’000 
2009 
£’000 
financial liabilities at amortised cost  
bank interest payable 428 454
financial liabilities at fair value through profit and loss  
unwinding of discount on contingent and deferred consideration 659 61
unwinding of discount on share purchase obligation 140 34
change in estimate of future contingent consideration payable 63 –
movement in fair value of interest rate capandcollar contract – 255
other  
finance lease interest 16 35
other interest payable 4 –
finance expense 1310 839
7 finance income 
 
2010 
£’000 
2009 
£’000 
financial assets at amortised cost  
bank interest receivable 53 144
financial assets at fair value through profit and loss  
movement in fair value of interest rate capandcollar contract 38 –
other  
other interest receivable 15 3
finance income 106 147
  next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
64  
8 taxation 
the major components of income tax expense for the year ended 31 july 2010 are 
 
2010 
£’000 
2009 
£’000 
consolidated income statement   
current income tax   
current income tax expense 2361 1189 
adjustments in respect of over provision of current income tax in prior years 331 201 
deferred income tax   
relating to the origination and reversal of temporary differences 351 97 
adjustments in respect of deferred tax for prior years 88 7 
income tax expense reported in the consolidated income statement 1591 884 
consolidated statement of changes in equity   
net revaluation of sharebased remuneration 166 7 
income tax expense reported in equity 166 7 
factors affecting the tax charge for the year   
the tax assessed for the year is higher than the standard rate of corporation tax in the uk of 28  
2009 28 the difference is explained below   
profit before income tax 5304 3158 
corporation tax expense at 28  1485 884 
effects of   
disallowed expenses 277 167 
recognition and utilisation of previously unrecognised tax losses 215 192 
nonutilisation of tax losses 158 30 
higher rates of tax on overseas earnings 708 608 
deductions for overseas taxes 621 597 
adjustments in respect of prior years 201 16 
 1591 884 
the group’s effective corporation tax rate for the year ended 31 july 2010 30 is slightly higher than the prior year 28 and 
standard uk rates due to acquisitions undertaken by the group in the year and the impact of the reduction in the uk corporation 
tax rate as a result of the acquisitions a greater proportion of group profit was generated in higher tax regimes and losses arose in 
territories in which it would not be prudent to recognise deferred tax assets 
as a result of the reduction in the uk corporation tax rate from 28 to 27 that was substantively enacted on 27 july 2010 and 
effective from 1 april 2011 the uk deferred tax balances have been remeasured  
further reductions to the uk corporation tax rate have been announced the changes which are expected to be enacted 
separately each year propose to reduce the rate by 1 per annum to 24 by 1 april 2014 these changes had not been 
substantively enacted at the balance sheet date and therefore are not recognised in the financial statements  overview
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annual report 2010
financial statements
 
 
65 
9 dividend 
 
2010 
£’000 
2009
£’000 
dividends paid during the year  
final dividend paid for prior year of 125p per ordinary share 2008 125p 675 662
interim dividend paid of 0475p per ordinary share 2009 045p 257 238
 932 900
noncontrolling interest dividend1 256 226
1the group acquired control of 463 communications as at 1 august 2008 during the year a profit share was paid to the holders of the noncontrolling interest of £256000 
2009 £226000  
the esop waived its right to dividends in the financial year ended 31 july 2010 £9000 and the year ended 31 july 2009 £18000 
a final dividend of 1375p per share 2009 125p has been proposed this has not been accrued the interim dividend was 0475p 
per share 2009 045p making a total for the year of 185p per share 2009 170p the final dividend if approved at the agm on 
25 january 2011 will be paid on 4 february 2011 to all shareholders on the register of members on 7 january 2011 the exdividend 
date for the shares is 5 january 2011 
10 earnings per share 
 
2010  
£’000 
2009 
£’000 
earnings attributable to ordinary shareholders 3675 1932
movement in fair value of interest rate capandcollar contract after tax 27 184
movement in fair value of forward foreign exchange contracts after tax 114 234
reorganisation costs after tax – 1339
unwinding of discount on contingent and deferred consideration after tax 395 –
unwinding of discount on share purchase obligation 140 71
change in estimate of future contingent consideration payable after tax 38 –
impairment charge 116 116
amortisation of acquired intangibles after tax 377 –
adjusted earnings attributable to ordinary shareholders 4600 3408
 
 
number number 
weighted average number of ordinary shares 54444622 52585175
dilutive share optionsperformance shares outstanding
1
 4767099 133987
other potentially issuable shares
2
 1866697 –
diluted weighted average number of ordinary shares 61078418 52719162
basic earnings per share 675p 367p
diluted earnings per share 602p 366p
adjusted earnings per share 845p 648p
diluted adjusted earnings per share 753p 646p
adjusted and diluted adjusted earnings per share have been presented to provide additional useful information the adjusted 
earnings per share is the performance measure used for the vesting of employee share options and performance shares the only 
difference between the adjusting items in this note and the figures in note 5 is the tax effect of those adjusting items 
2
relates to an estimate of the contingent consideration satisfied in shares payable to m booth in years two to four following completion  
1
relates mainly to performance shares on which the performance criteria are expected to be met and will vest in the year to 31 july 2009 it was deemed that the 
performance criteria would not be met and therefore the performance shares were not expected to vest at the next fifteen annual general meeting held on  
26 january 2010 shareholder approval was obtained to modify the performance conditions relating to all new awards under the next fifteen longterm incentive plan 
from february 2010 and to apply the changes to grants made in the financial years ended 31 july 2008 and 31 july 2009   next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
66  
11 intangible assets 
 
software 
£’000 
trade name 
£’000 
customer 
relationships 
£’000
goodwill  
£’000  
total  
£’000 
cost   
at 1 august 2008 1829 – – 15432 17261 
additions resulting from internal development 134 – – – 134 
acquired through business combinations – 192 465 1507 2164 
exchange differences 62 25 51 1253 1391 
at 31 july 2009 2025 217 516 18192 20950 
additions resulting from internal development 302 – – – 302 
acquired through business combinations
1
 12 1074 1466 5643 8195 
exchange differences 60 100 139 824 1123 
at 31 july 2010 2399 1391 2121 24659 30570 
amortisation and impairment   
at 1 august 2008 618 – – 1181 1799 
charge for the year 258 10 129 – 397 
impairment charge – – – 116 116 
exchange differences 47 – 6 156 197 
at 31 july 2009 923 10 123 1453 2509 
charge for the year 236 67 459 – 762 
impairment charge – – – 116 116 
exchange differences 5 1 10 56 72 
at 31 july 2010 1164 78 592 1625 3459 
net book value at 31 july 2010 1235 1313 1529 23034 27111 
net book value at 31 july 2009 1102 207 393 16739 18441 
1
on 3 august 2009 the group acquired m booth and acquired intangibles of £1282000 relating to customer relationships and £1074000 relating to trade name  
on 27 october 2009 the group acquired upstream asia and acquired intangibles of £184000 relating to customer relationships  
see note 26 
impairment testing for cashgenerating units containing goodwill 
goodwill acquired through business combinations is allocated to groups of cashgenerating units ‘cgus’ for impairment testing 
as follows 
 
2010  
£’000 
2009  
£’000 
bite uk 1512 1628 
lexis uk 8383 8383 
outcast us 6752 6377 
bite us 340 321 
context analytics us 32 30 
m booth us 4983 – 
bite upstream apac 1032 – 
 23034 16739 
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financial statements
 
 
67 
11 intangible assets continued 
the recoverable amounts of all cgus have been determined from valueinuse calculations using a projection period of five years 
for each cashgenerating unit the basis for this is the 2011 budget approved by the board with a further four years based on 
projected pretax cash flows extrapolated using a growth rate of 25 after the initial projection period a steady longterm growth 
rate of 25 and no improvement in operating margin has been applied to the pretax cash flow forecast into perpetuity this is 
considered prudent based on experience and current expectations of the longterm industry growth rate a pretax discount rate 
being the group’s weighted average cost of capital of 110 2009 100 has been used in discounting the projected cash flows 
the board has considered reasonable possible sensitivities in key assumptions on which the valueinuse calculations are based 
if growth rates reduced to 0 or if the discount rate increased to 20 this would not cause the carrying values of the groups of 
cgus to exceed their recoverable amounts in all cases except for lexis sensitivity analysis shows that if the discount rate is 
increased in isolation to 18 the estimated recoverable amount of lexis is equal to carrying value 
the goodwill impairment review performed at year end has resulted in an impairment charge for the goodwill recognised by bite 
on acquisition of credo on 31 december 2005 part of the bite uk cgu the operations were transferred into bite and as a result 
the decision has been made to write down the goodwill by £116000 as a result of this write down the credo goodwill is now fully 
impaired 
there was no other impairment of goodwill as the estimated recoverable amount exceeds the carrying value in all other cases 
12 property plant and equipment 
 
short leasehold 
improvements 
£’000 
office
 equipment 
£’000 
office 
 furniture  
£’000  
motor 
 vehicles  
£’000  
total 
£’000
cost   
at 1 august 2008 2696 4053 1153 106 8008
exchange differences 219 491 141 6 857
additions 11130929 6 455
disposals 88264116 59 527
at 31 july 2009 2938 4589 1207 59 8793
exchange differences 113 165 38 4 320
additions 422600152 11 1185
acquired through business combinations 32 75 53 – 160
disposals 77121 33 132
at 31 july 2010 3498 5358 1429 41 10326
accumulated depreciation   
at 1 august 2008 1374 3322 815 62 5573
exchange differences 105 349 98 4 556
charge for the year 481 534 145 8 1168
disposals 16293111 33 453
at 31 july 2009 1944 3912 947 41 6844
exchange differences 46 184 35 2 267
charge for the year 352 564 134 10 1060
disposals 76418 25 114
at 31 july 2010 2335 4596 1098 28 8057
net book value   
at 31 july 2010 1163 762 331 13 2269
at 31 july 2009 994 677 260 18 1949
the net book value of property plant and equipment for the group includes assets held under finance lease contracts as follows 
£55000 of short leasehold improvements 2009 £62000 and £3000 of office equipment and furniture 2009 £11000  next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
68  
13 trade and other receivables 
 
2010  
£’000  
2009  
£’000 
current 
trade receivables 16475 10684 
less provision for impairment of trade receivables 227 201 
trade receivables – net 16248 10483 
other receivables 604 729 
prepayments and accrued income 5040 3383 
 21892 14595 
noncurrent   
rent deposits 1008 533 
as of 31 july 2010 trade receivables of £227000 2009 £201000 were impaired movements in the provision are as follows 
  
 2010 
 £’000 
 2009  
£’000 
at 1 august 201 233 
acquired through business combinations 37 – 
provision for receivables impairment 155 128 
receivables written off during the year as uncollectable 39 115 
reversed 135 65 
foreign exchange movements 8 20 
at 31 july 227 201 
the provision for receivables impairment has been determined by considering specific doubtful balances and by reference to 
historic default rates owing to the immaterial level of the provision for impairment of receivables no further disclosure is made 
the group considers there to be no material difference between the fair value of trade and other receivables and their carrying 
amount in the balance sheet 
as at 31 july the analysis of trade receivables that were not impaired is as follows 
  
2010  
£’000 
2009  
£’000 
not past due 9114 5272 
up to 30 days 4434 3573 
31 to 60 days 1780 1131 
greater than 61 days 920 507 
at 31 july 16248 10483 
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annual report 2010
financial statements
 
 
69 
14 trade and other payables 
 
2010  
£’000  
2009 
£’000 
current 
trade creditors 2762 1855
finance lease obligation 78 194
other taxation and social security 1350 1363
shortterm compensated absences 1584 1347
other creditors 3646 3659
accruals and deferred income 7665 5261
 17085 13679
noncurrent  
finance lease obligation 56 73
15 provisions for other liabilities and charges 
 
2010  
£’000 
 2009 
£’000 
at 1 august  282 –
additions – 282
used during year 224 –
at 31 july  58 282
current 58 –
noncurrent – 282
provisions comprise liabilities where there is uncertainty about the timing of settlement but where a reliable estimate can be 
made of the amount the provision covers the cost of rent rates and dilapidations on an unoccupied leasehold property due 
to the merger of inferno communications limited into bite communications limited on 1 may 2009 for which the lease runs 
to december 2010 no reimbursement for a sublease is expected and the effect of discounting is deemed immaterial 
16 amounts due under finance leases 
 minimum lease payments 
present value of 
minimum lease payments
 
2010
£’000
2009 
£’000 
2010 
£’000 
2009
£’000 
amounts payable   
within one year 80 209 78 194
in two to five years 60 82 56 73
 140 291 134 267
less finance charges allocated to future periods 6 24 – –
present value of lease obligations 134 267 134 267
  next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
70  
17 other financial liabilities 
 
deferred
 consideration
1
 £’000
contingent 
 consideration
2
 
 £’000 
share 
 purchase 
 obligation
3
 
 £’000 
at 1 august 2008 2769 – 1737 
arising during the year 100 – – 
exchange differences 334 – – 
utilised 3036 – 1771 
unwinding of discount 61 – 34 
at 31 july 2009 228 – – 
arising during the year 9 5102 1364 
exchange differences 2 302 78 
utilised 249 – 83 
unwinding of discount 14 708 140 
at 31 july 2010 – 6112 1499 
current – 1880 150 
noncurrent – 4232 1349 
1
deferred consideration on acquisitions  
in october 2009 us312000 £199000 of final deferred consideration was paid for the outcast agency and sek569000 £50000 of final deferred consideration was 
paid for aimpr public relations ab these both settle the deferred consideration liability outstanding at 31 july 2009  
2
contingent consideration on acquisitions  
on 3 august 2009 the group acquired 100 of the voting equity instruments of new yorkbased m booth  associates inc ‘m booth’ the acquisition of m booth 
includes a contingent consideration arrangement that requires additional consideration to be paid by the company based on achievement of certain revenue and 
performance targets over the course of the next four years  
3
share purchase obligation  
on 27 october 2009 the group acquired 55 of upstream marketing and communications inc ‘upstream asia’ the group has entered into an option deed under 
which it has an obligation to acquire the residual 45 over a fiveyear period based on the profitability of the acquired businesses leading to a share purchase obligation 
of us1213000 £736000 arising on the acquisition date  
on 31 october 2009 the group acquired a further 30 holding in 463 communications taking the group’s total holding to 70 at this point the group was obliged to 
purchase 100 of the business over a sevenyear period leading to a share purchase obligation of us1035000 £628000 arising on the acquisition date a further 6 
was acquired on 28 may 2010 for consideration of us120000 £83000  
see note 26 
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financial statements
 
 
71 
18 deferred taxation 
temporary differences between the carrying value of assets and liabilities in the balance sheet and their relevant value for tax 
purposes result in the following deferred tax assets and liabilities 
accelerated 
capital 
allowances 
£’000  
shortterm 
compensated 
absences 
£’000 
sharebased 
remuneration 
£’000 
provision for 
impairment 
of trade 
receivables 
£’000 
excess book 
basis over 
tax basis of 
intangible 
assets 
£’000
derivative 
financial 
instruments 
£’000  
other 
temporary 
differences 
£’000 
total 
£’000 
at 1 august 2008 534 494 126 41 151 189 203 1436
creditcharge to income 90 183 63 7 83 17 187 104
exchange differences 46 62 – 7 19 – 10 106
taken to equity    
share option schemes – – 7 – – – – 7
at 31 july 2009 670 373 70 55 87 172 400 1653
creditcharge to income 116 49 185 22 79 59 279 439
exchange differences 25 17 – 4 25 – 55 76
acquired through business 
combinations – ––––– 10 10
offset against goodwill – – – – 886 – – 886
taken to equity    
share option schemes – – 166 – – – – 166
at 31 july 2010 579 439 421 81 919 113 744 1458
after netting off balances the following are the deferred tax assets and liabilities recognised in the consolidated balance sheet 
  
 2010  
£’000 
2009
£’000 
net deferred tax balance  
deferred tax assets 1531 1695
deferred tax liabilities 73 42
net deferred tax asset 1458 1653
deferred tax has been calculated using the anticipated rates that will apply when the assets and liabilities are expected to reverse 
based on tax rates enacted or substantively enacted by the balance sheet date the recoverability of deferred tax assets is 
supported by the expected level of future profits in the countries concerned 
19 financial instruments 
financial risk management policies and strategies 
the group’s principal financial instruments comprise bank loans finance leases cash and shortterm deposits and derivative 
financial instruments the main purpose of these financial instruments is to provide finance for the group’s operations 
the group has various other financial assets and liabilities such as trade receivables and payables which arise directly from 
operations 
the group enters into derivative transactions primarily capandcollar interest rate and forward foreign exchange contracts 
the purpose of such contracts is to protect the profits and surplus funds arising in principal markets from currency fluctuations 
and to manage the interest rate risks on the group’s sources of finance  
the main risks arising from the group’s financial instruments are interest rate risk liquidity risk foreign exchange risk and credit risk 
the board reviews and agrees policies for managing each of these risks and they are summarised below  next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
72  
19 financial instruments continued 
interest rate risk 
the group’s exposure to the risk of changes in market interest rates relates primarily to the group’s longterm debt obligations with 
floating interest rates and capandcollar interest rate derivatives 
the group’s policy is to manage its interest costs arising on variable rate debts by entering into interest rate capandcollar 
contracts these agreements are designated to protect underlying debt obligations against significant increases in interest rates as 
required under the terms of the group’s revolving loan facility with barclays bank at 31 july 2010 us8m of us dollar borrowings 
have been capped at 625 through to march 2012 
the following table demonstrates the sensitivity to a reasonable possible change in interest rates with all other variables held 
constant of the group’s profit before tax at 31 july 2010 based on year end balances and rates 
 
movement in 
basis points 
2010  
£’000  
2009  
£’000 
united kingdom 200 141 5 
us 200 136 143 
a rise in us interest rates of 2 would give a positive movement of £148000 2009 £240000 in the fair value of the interest rate 
capandcollar contract 
the interest rate capandcollar contract is categorised as a level two financial instrument in the fair value hierarchy  
liquidity risk 
the group manages its risk to a shortage of funds with a mixture of long and shortterm committed facilities as at 31 july 2010 
the group had undrawn committed facilities of £4040000 2009 £6000000 in addition the group has an overdraft facility with 
barclays bank of £1500000 2009 £1500000 at a rate of 225 above barclays bank’s base rate available in sterling us dollar 
and euro and a credit line with wells fargo bank of us2735000 £1746000 2009 us2000000 £1206000 at the prime rate 
currently 325 available in us dollars the barclays bank’s overdraft facility is reviewed at the bank’s discretion with no expiry date 
the wells fargo bank’s overdraft facility is reviewed on an annual basis and expires in january 2011 the following table summarises 
the maturity profile based on the remaining period at the balance sheet date to the contractual maturity date of the group’s 
financial liabilities at 31 july 2010 and 2009 based on contractual undiscounted payments 
within
one year 
£000
greater than 
one year 
£’000 
total 
£000 
as at 31 july 2010    
financial liabilities  23623 9932 33555 
derivative financial instruments – cash inflows – – – 
derivative financial instruments – cash outflows 244 152 396 
 23867 10084 33951 
as at 31 july 2009   
financial liabilities 13306 5286 18592 
derivative financial instruments – cash inflows 2870 – 2870 
derivative financial instruments – cash outflows 3218 438 3656 
 13654 5724 19378 
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annual report 2010
financial statements
 
 
73 
19 financial instruments continued 
currency risk 
as a result of significant global operations the group’s balance sheet can be affected significantly by movements in the foreign 
exchange rates against sterling this is largely through the translation of balances denominated in a currency other than the 
functional currency of an entity the group has transactional currency exposures in the europe africa and asia pacific region 
including foreign currency bank accounts and intercompany recharges the group uses currency derivatives to protect significant 
us dollar and euro currency exposures against changes in exchange rates 
the following table demonstrates the sensitivity to reasonable possible changes in exchange rates with all other variables held 
constant of the group’s profit before tax at 31 july 2010 based on year end balances and rates 
 
weakening  
against sterling 
2010  
£’000 
2009 
£’000 
us dollar 20 241 2955
euro 20 564 73
australian dollar 20 282 682
chinese renminbi 20 68 448
hong kong dollar 20 46 9
indian rupee 20 214 92
japanese yen 20 141 12
singapore dollar 20 4 180
south african rand 20 32 17
credit risk 
the group’s principal financial assets are bank balances and cash trade and other receivables which represent the group’s 
maximum exposure to credit risk in relation to financial assets the group trades only with recognised creditworthy third parties 
it is the group’s policy that customers who wish to trade on credit terms be subject to credit verification procedures in addition 
receivable balances are monitored on an ongoing basis with the result that the group’s exposure to bad debts has not been 
significant the amounts presented in the balance sheet are net of provisions for impairment of trade receivables estimated by 
the group’s management based on experience and their assessment of the current economic environment 
the credit risk on liquid funds is limited because the counterparties are reputable banks with high credit ratings assigned by 
international creditrating agencies although the board recognises that in the current economic climate these indicators cannot 
be relied upon exclusively 
maximum exposure to credit risk 
  
 2010  
£’000 
2009
£’000 
total trade and other receivables 22900 15128
cash and cash equivalents 7296 7130
capital risk management 
the group manages its capital to ensure that entities in the group will be able to continue as a going concern while maximising 
the return to stakeholders through the optimisation of the debt and equity balance total capital of the group is calculated as total 
equity as shown in the consolidated balance sheet plus net debt net debt is calculated as total borrowings and finance leases less 
cash and cash equivalents   next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
74  
19 financial instruments continued 
capital risk management continued 
 
2010  
£’000  
2009  
£’000 
total loans and borrowings 8033 5078 
obligations under finance leases 134 267 
less cash and cash equivalents 7296 7130 
net debtfunds 871 1785 
total equity  27579 24902 
total capital 28450 23117 
externally imposed capital requirement 
under the terms of the group’s banking covenants the group must meet certain criteria based on gross borrowings to earnings 
before interest tax depreciation amortisation and impairment interest cover and guarantee ratios on turnover operating profit 
total assets and total operating cash flows to consolidated gross financing costs there have been no breaches of the banking 
covenants in the current or prior year 
fair values of financial assets and liabilities 
fair value is the amount at which a financial instrument can be exchanged in an arm’slength transaction between informed 
and willing parties other than a forced or liquidation sale 
the book value of the group’s financial assets and liabilities equals the fair value of such items as at 31 july 2010 with the exception 
of obligations under finance leases the book value of obligations under finance leases is £134000 2009 £267000 and the fair 
value is £140000 2009 £291000  overview
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next fifteen communications group plc
annual report 2010
financial statements
 
 
75 
19 financial instruments continued 
financial instruments – detailed disclosures 
financial instruments recognised in the balance sheet 
the ias 39 categories of financial assets and liabilities included in the balance sheet and the heading in which they are included are 
as follows 
 
at fair value 
through 
profit and 
loss account 
£’000
financial  
liabilities at  
amortised  
cost  
£’000 
loans and 
receivables  
£’000 
total 
£’000
as at 31 july 2010   
noncurrent financial assets   
other receivables – – 1008 1008
 – – 1008 1008
current financial assets   
cash and cash equivalents – – 7296 7296
trade and other receivables – – 21892 21892
 – – 29118 29118
current financial liabilities   
loans and borrowings – 5181 – 5181
trade and other payables – 17085 – 17085
provisions for other liabilities and charges – 58 – 58
contingent consideration
1
 – 1880 – 1880
derivative financial liabilities 419 – – 419
share purchase obligation
1
 – 150 – 150
 419 24354 – 24773
noncurrent financial liabilities   
loans and borrowings – 2852 – 2852
obligations under finance leases – 56 – 56
contingent consideration
1
 – 4232 – 4232
share purchase obligation
1
 – 1349 – 1349
 – 8489 – 8489
1
see note 17   next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
76  
19 financial instruments continued 
financial instruments recognised in the balance sheet continued 
 
at fair value 
through 
profit and 
loss account 
£’000 
financial
liabilities at 
amortised
cost
£’000 
loans and 
receivables  
£’000 
total  
£’000 
as at 31 july 2009   
noncurrent financial assets   
other receivables – – 533 533 
 ––533 533 
current financial assets   
cash and cash equivalents – – 7130 7130 
trade and other receivables – – 14595 14595 
 ––21725 21725 
current financial liabilities   
loans and borrowings – 156 – 156 
trade and other payables – 13679 – 13679 
deferred consideration
1
 –228– 228 
derivative financial liabilities 615–– 615 
share purchase obligation
1
 ––– – 
 61514063– 14678 
noncurrent financial liabilities   
loans and borrowings – 4922 – 4922 
obligations under finance leases – 73 – 73 
provisions for other liabilities and charges – 282 – 282 
deferred consideration
1
 ––– – 
 –5277– 5277 
1
see note 17  
interestbearing loans and borrowings 
the table below provides a summary of the group’s loans and borrowing as at 31 july 2010 
 
effective interest rate 
2010 
£’000 
2009 
£’000 
current   
obligations under finance leases 342 78 194 
variable rate bank loan barclays bank callloan rate  125 4821 156 
variable rate bank loan 650 96 – 
variable rate bank loan wells fargo bank callloan rate  25 128 – 
fixed rate bank loan 719 136 – 
noncurrent   
obligations under finance leases 342 56 73 
variable rate bank loan barclays bank callloan rate  125 – 4826 
variable rate bank loan barclays bank callloan rate  225 2139 – 
variable rate bank loan 650 – 96 
variable rate bank loan wells fargo bank callloan rate  250 464 – 
fixed rate bank loan 719 249 –  overview
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annual report 2010
financial statements
 
 
77 
19 financial instruments continued 
hedge of net investment in foreign entity 
a proportion of the group’s us dollardenominated borrowings amounting to us4000000 is designated as a hedge of the net 
investment in the group’s us subsidiary m booth  associates inc the fair value of the borrowings at 31 july 2010 is us4000000 
£2554000 the foreign exchange loss of £111000 on translation of the borrowing to functional currency at the end of the 
reporting period is recognised in a hedging reserve in shareholders’ equity  
20 share capital 
calledup share capital 
ordinary shares of 25p each 
 number £’000
allotted called up and fully paid  
at 1 august 2009 55247557 1381
issued in the year in respect of  
further 30 stake in 463 communications llc 805095 20
at 31 july 2010 56052652 1401
21 sharebased payments 
the group uses the blackscholes model to calculate the fair value of options on grant date for new issues and modifications 
at each year end the cumulative expense is adjusted to take into account any changes in estimate of the likely number of shares 
expected to vest details of the relevant option schemes are given in note 22 all the sharebased payment plans are subject 
to nonmarket performance conditions such as adjusted earnings per share targets and continued employment all schemes 
are equitysettled the key inputs are listed below and market price on each grant date is obtained from external publicly 
available sources 
 2010 2009 
riskfree rate 475 413
dividend yield 347 416
volatility
1
 40 35
1
volatility is based on the group’s share price movement between january 2003 and july 2010 in the opinion of the directors this period is appropriate given the group’s 
history of growth and acquisitions and external industry factors 
the group recognised a charge of £606000 2009 £57000 credit 
movement on options granted represented in ordinary shares 
 
outstanding at 
1 august 
2009 
number 
‘000 
granted 
number 
‘000 
lapsed 
number 
‘000 
exercised  
number  
‘000 
outstanding  
31 july  
2010  
number  
‘000 
exercisable 
31 july 
2010 
number 
‘000
executive share option scheme 1276 – 289 318 669 539
longterm incentive plan – options 236 – 112 – 124 94
longterm incentive plan – performance shares 4163 2335 841 132 5525 –
restricted stock grant agreement – 263 – – 263 –
 567525981242450 6581 633
weightedaverage exercise price p 1348 – 1726 2439 671 4971
a total of 450164 shares were exercised during the year ended 31 july 2010 at a weighted average market share price of 6370p  next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
78  
21 sharebased payments continued 
options over ordinary shares outstanding 
range of exercise prices p 0 – 215 
weighted average exercise price p 671 
weighted average contractual life months 29 
the fair value of options granted in the year calculated using the blackscholes model 
 
february 
 2010 
june  
2010 
fair value of performance shares granted under the ltip p 43 46 
share price at date of grant p 60 64 
riskfree rate  475 475 
expected life years 4 4 
expected volatility  40 40 
dividend yield  347 347 
the modification to the performance criteria on 26 january 2010 does not lead to an increase in the fair value at the date of modification therefore no incremental fair 
value is recognised the performance share grants which have been modified are set out in note 22  
performance shares issued by the company under the next fifteen communications longterm incentive plan are granted 
at a nil exercise price 
22 share options 
the company has issued options over its shares to employees as follows 
share option type 
number 
of shares 
option price 
per share option grant date 
next fifteen communications  
executive share option schemes 18000 215p 22 november 2000 
 8200060p21 may 2001 
 37333235p23 october 2001 
 7333330p22 october 2002 
 170000595p22 october 2003 
 380666 
next fifteen communications  
californian executive share option schemes 80000 30p 22 october 2002 
 178334595p22 october 2003 
 3000063p12 may 2004 
 288334 
next fifteen communications  
longterm incentive plan 43254 56p 16 june 2005 
 50892 56p 11 november 2005 
 2954566p10 april 2006 
 123691 
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next fifteen communications group plc
annual report 2010
financial statements
 
 
79 
22 share options continued 
performance shares 
number 
of shares performance period start date performance period end date performance share grant date 
next fifteen communications  
longterm incentive plan 533496 1 august 2007 31 july 2011
1
 9 november 2007
 1002190 1 august 2007 31 july 2011
1
 2 june 2008
 60000 1 august 2008 31 july 2012
1
 22 october 2008
 1704414 1 august 2008 31 july 2012
1
 21 november 2008
 80000 1 may 2009 1 may 2011 1 may 2009
 2110000 1 august 2009 31 july 2013 9 february 2010
 35000 1 august 2009 31 july 2013 4 june 2010
 5525100 
restricted stock grant agreement 262796 3 august 2009 3 august 2012 3 august 2009
1
performance criteria modified on 26 january 2010 
under the next fifteen executive share option schemes save as explained hereafter all options are normally exercisable on or after 
the third anniversary of the date of grant and remain exercisable until the tenth anniversary of the date of the grant to the extent 
that they have vested options will vest in respect of onethird of the shares on each of the third fourth and fifth anniversaries of 
their date of grant options granted to employees in california from 23 october 2001 are exercisable at a rate of 20 per year over 
five years from the date of grant the vesting of all share options granted after 30 november 1999 is conditional on achievement of 
a performance criterion of the group’s earnings per share growing over a threeyear period after the grant by at least 30 
4915432 share optionsperformance sharesconditional shares issued by the company under the next fifteen communications 
executive share option schemes longterm incentive plan and restricted stock grant agreement are optionsperformance 
sharesconditional shares over unissued shares the remaining 1665155 optionsperformance sharesconditional shares will be 
largely satisfied by either shares held by the employee share ownership plan 500897 or by shares held by the company in 
treasury 1164258 see note 23 
at the next fifteen general meeting held on 26 january 2010 shareholder approval was obtained to modify the performance 
conditions relating to all new awards under the next fifteen longterm incentive plan from february 2010 and to apply the 
changes to grants made in the financial years ended 31 july 2008 and 31 july 2009 performance will be measured over a 
period of four consecutive financial years of the group commencing with the financial year in which the award was granted 
the new conditions are based upon two measures – an adjusted earnings per share ‘eps’ measure and a budgeted profit 
measure the level of vesting will be determined using the best three of the four years’ performance for each performance measure 
the growth of adjusted eps of the group must exceed the retail price index ‘rpi’ by an average of 10 or more per annum over 
the performance period for 50 of the award to vest if the growth of adjusted eps over rpi is between an average of 3 and 10 
per annum over the performance period between 10 and 50 of the award will vest on a straightline basis the remaining 50 
of an award may vest if the profit of the particular business in which a participant is employed meets its budgeted profit targets 
over the performance period to the extent that the budgeted profit targets are not met for every 1 below budget 5 of the 
award will lapse on a straightline basis employees who work in group roles will be measured by reference to whole group 
performance rather than any particular business unit 
on 1 may 2009 inferno communications limited ‘inferno’ a wholly owned subsidiary of the group merged into bite 
communications limited ‘bite’ also a wholly owned subsidiary of the group following the merger there was a oneoff grant 
of performance shares to two senior members of inferno who transferred to bite the extent to which the award would vest is 
determined by reference to the retention of key clients by bite for which the participants are the key account directors on 1 may 
2010 60 of the award vested as the clients remained with bite and the final 40 will vest if the clients still remain on 1 may 2011  next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
80  
22 share options continued 
on 3 august 2009 the group acquired m booth  associates inc ‘m booth’ and entered into a restricted stock grant agreement 
of us200000 the number of shares granted was determined by reference to the average of the midmarket price of the 
company’s shares for the ten trading day period ended four days prior to issuance leading to a total of 262796 shares granted 
the fair value of the shares was based on the market value at the date of grant the grant shares will vest in equal amounts on each 
of the first three anniversaries of the date of grant provided that each participant remains a fulltime employee of m booth as of the 
anniversary vesting date  
23 investment in own shares 
employee share ownership plan esop 
the purpose of the esop is to enable the company to offer participation in the ownership of its shares to group employees 
principally as a reward and incentive scheme arrangements for the distribution of benefits to employees which may be the 
ownership of shares in the company or the granting of options over shares in the company held by the esop are made at 
the esop’s discretion in such manner as the esop considers appropriate administration costs of the esop are accounted for 
in the profit and loss account of the company as they are incurred 
at 31 july 2010 the esop held 500897 2009 951061 ordinary shares in the company which represents 09 2009 17 of the 
ordinary share capital the esop reserve of £162000 2009 £644000 represents the cost of these shares held by the esop in the 
company at 31 july 2010 the nominal value of shares held was £12522 2009 £23777 and the market value at 31 july 2010 was 
£300538 2009 £456509 the right to receive dividends on all shares has been waived 
during the year to 31 july 2010 a number of employees exercised their options in total 317664 2009 190000 esop options were 
exercised for proceeds of £109800 2009 £63301 as were 132500 performance shares 
treasury shares 
the group holds 1164258 2009 1164258 treasury shares at a cost of £595000 2009 £595000 the nominal value of shares held 
at 31 july 2010 was £29106 2009 £29106 and the market value was £698555 2009 £558844 the right to receive dividends on 
all shares has been waived 
24 other reserves  
 
esop
 reserve
1
 £’000
treasury
 shares
2
 £’000
hedging  
 reserve  
 £’000 
total other  
 reserves  
 £’000 
at 1 august 2008 663 504 – 1167 
movement due to esop share option exercises 19 – – 19 
purchase of own shares – 91 – 91 
at 31 july 2009 644 595 – 1239 
total comprehensive income for the year – – 111 111 
movement due to esop share option exercises 482 – – 482 
at 31 july 2010 162 595 111 868 
1
the esop trust’s investment in the group’s shares is deducted from equity in the consolidated balance sheet as if they were treasury shares and presented in the 
esop reserve 
2
when the group reacquires its own equity instruments those instruments treasury shares are deducted from equity and presented in the treasury shares reserve  overview
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next fifteen communications group plc
annual report 2010
financial statements
 
 
81 
25 commitments and contingent liabilities 
operating leases – group as lessee 
as at 31 july 2010 the group’s total future minimum lease rentals are as follows 
  
 2010 
land and 
buildings 
£’000 
2010  
other  
£’000  
2009  
land and  
buildings  
£’000  
2009 
other 
£’000 
in respect of operating leases which will expire   
within one year 3767 172 3374 208
in two to five years 10631 399 6797 254
after five years 1779 – 2642 –
 16177 571 12813 462
26 acquisitions 
1 on 3 august 2009 the group acquired 100 of the share capital of new yorkbased m booth  associates inc ‘m booth’ 
a leading pr consultancy in north america as part of the next step in the group’s strategy to build a global consumer agency 
the initial consideration paid in cash on completion was us4000000 £2554000 a balance of us790000 £504000 excess 
working capital acquired which was paid to the vendors is also treated as consideration further consideration of up to a 
maximum of us13250000 £8461000 may be payable over the course of the next four years subject to the achievement 
of certain revenue and profit performance targets the total maximum consideration is therefore us17250000 £11015000 
excluding the payment for excess working capital the first us11250000 £7184000 of contingent consideration that may be 
payable can be satisfied by cash or up to 25 in shares at the option of the group the final us2000000 £1277000 that may 
be payable can be satisfied 100 in shares at the option of the group  
from 3 august 2009 to 31 july 2010 m booth contributed us11500000 £7343000 to revenue and us1688000 £1078000 
profit before tax  
acquisition costs of us184000 £117000 were paid in relation to the purchase of m booth us154000 £98000 recognised in 
the income statement for the year ended 31 july 2009 and us30000 £19000 recognised in the income statement for the year 
ended 31 july 2010 
goodwill arises from anticipated profitability and future operating synergies from combining the operations with the group  
the fair value of the assets acquired includes trade receivables of us3692000 £2357000 the gross amount due under 
contracts is equal to this balance and is all expected to be collectable   next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
82  
26 acquisitions continued 
the following table sets out the book values of the identifiable assets acquired and their fair value to the group 
  
book value 
at acquisition 
£’000 
fair value 
 adjustments
1
 
 £’000  
fair value  
to the group  
£’000 
noncurrent assets   
acquired intangible assets – 2547 2547 
property plant and equipment 91 – 91 
current assets   
cash and cash equivalents 482 – 482 
other current assets 3017 – 3017 
current liabilities 1970 – 1970 
deferred tax liability – 691 691 
net assets acquired 1620 1856 3476 
goodwill  4983 
consideration
2
   
cash consideration  2554 
excess working capital payment  504 
total contingent cash consideration  4190 
total contingent equity consideration  1211 
  8459 
1 
the fair value adjustment relating to intangible assets is due to the recognition of us1818000 £1161000 in respect of the m booth trade name and us2171000 
£1386000 in respect of customer relationships which have been independently valued there is a related deferred tax liability fair value adjustment of us1082000 
£691000 the trade name will be amortised over its useful economic life of 20 years and the customer relationships will be amortised over five years  
2 
the acquisition of m booth includes a contingent consideration arrangement that requires additional consideration to be paid by the group based on achievement 
of certain revenue and performance targets over the course of the next four years the range of undiscounted amounts the group could pay under the contingent 
consideration agreement is between us0 and us13250000 the fair value of the contingent consideration recognised on the acquisition date of us8459000 
£5401000 was estimated by applying the income approach by calculating the fair value of the future estimated payments 
2 on 31 october 2009 the group acquired a further 30 stake in 463 communications llc ‘463 communications’ taking the 
group’s total holding to 70 the group is now obliged to purchase 100 of the business over a sevenyear period the holding 
was acquired for a total consideration of us2139000 £1365000 of which us1426000 £910000 was satisfied in cash and 
us713000 £455000 in shares 805095 shares 
on 28 may 2010 the group acquired a further 6 stake in 463 communications taking the group’s total holding to 76 
the holding was acquired for a total consideration of us120000 £77000 which was satisfied in cash there were no 
acquisition costs incurred in relation to the further interest acquired 
no goodwill has been recognised on the acquisition of the further equity interest in 463 communications the effect of this 
transaction is recorded in equity as there is no change in control  
3 on 27 october 2009 the group acquired the marketing communications trading subsidiaries of upstream marketing and 
communications inc ‘upstream asia’ which has been integrated into the bite communications group the initial consideration 
was us900000 £575000 paid in cash and the assumption of us200000 £128000 of upstream asia’s liabilities of which 
us120000 £77000 were paid on completion the group owns 55 of upstream asia and a hong kong based company 
asset pioneer limited ‘asset pioneer’ owns the residual 45 the group has entered into an option deed under which it has 
a obligation to acquire asset pioneer’s shares over a fiveyear period based on the profitability of the acquired businesses  
in the post acquisition period upstream asia contributed £2016000 to revenue and £18000 loss before tax if the acquisition 
had been completed on the first day of the financial year group revenues for the year would have been £73000000 and profit 
before income tax would have been £5298000 these amounts have been calculated using the group’s accounting policies 
and prorating the ninemonth results across 12 months   overview
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next fifteen communications group plc
annual report 2010
financial statements
 
 
83 
26 acquisitions continued 
acquisition costs of us123000 £79000 were paid in relation to the acquisition of upstream asia and recognised within the 
consolidated income statement  
goodwill arises from anticipated profitability and future operating synergies from the combination 
the fair value of the assets acquired includes trade receivables of £549000 the gross amount due under contracts totals £582000 
of which £549000 is expected to be collectable  
the following table sets out the book values of the identifiable assets acquired and their fair value to the group 
  
book value  
at acquisition  
£’000  
fair value 
 adjustments
1
 
 £’000 
fair value 
to the group 
£’000
noncurrent assets   
acquired intangible assets – 192 192
software intangible assets 12 – 12
property plant and equipment 63 – 63
current assets   
cash and cash equivalents 388 – 388
other current assets 1054 – 1054
current liabilities 1263 – 1263
deferred tax liability – 52 52
net assets acquired 254 140 394
goodwill   1032
consideration   
cash consideration   575
assumption of liabilities paid on completion   77
   652
fair value of noncontrolling interest
2
   774
   1426
1 
the fair value adjustment relating to intangible assets is due to the recognition of us300000 £192000 in respect of customer relationships which have been 
independently valued there is a related deferred tax liability fair value adjustment of us82000 £52000 the customer relationships will be amortised over five years 
2
the fair value of the noncontrolling interest of £774000 in upstream asia was estimated by calculating the fair value of the future payment obligations  
4 on 9 october 2009 the group paid us312000 £199000 in cash relating to the final deferred consideration for the purchase 
of the outcast agency ‘outcast’ outcast is a wholly owned subsidiary acquired in june 2005  
5 on 30 october 2009 the group paid sek569000 £50000 in cash relating to the final deferred consideration for the purchase 
of the business and certain assets of aimpr public relations ab a company based in stockholm sweden this business was 
integrated into bite’s existing swedish operation  next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
84  
27 subsidiaries 
the group’s principal subsidiaries at 31 july 2010 are listed below 
name country of incorporation 
directly owned by  
the company 
percentage voting  
rights held  
by group 
augustone communications international limited  england  100 
beijing text 100 consulting services limited china 100 
bite communications canada limited canada 100 
bite communications corporation  usa 100 
bite communications group limited england  100 
bite communications limited  england 100 
lexis public relations limited  england 100 
m booth  associates inc usa 100 
next fifteen communications corporation usa  100 
next fifteen communications hong kong limited  hong kong  100 
the outcast agency  usa 100 
panther communications group limited england  100 
proxima public relations sl  spain 100 
redshift research limited  england  100 
text 100 ab  sweden 100 
text 100 bv  netherlands 100 
text 100 corporation  usa 100 
text 100 sarl  france 100 
text 100 gmbh  germany  100 
text 100 international limited  england  100 
text 100 italy srl  italy 100 
text 100 japan kk  japan 100 
text 100 limited  england 100 
text 100 pte limited  singapore 100 
text 100 pty limited  south africa 100 
text 100 pty limited  australia 100 
text 100 sl  spain 100 
text hundred india private limited  india 100 
vox public relations india private limited india 100 
463 communications llc usa 76 
bite asia holdings limited england  55 
bite marketing consulting pte limited singapore 55 
bite communications hong kong limited hong kong 55 
bite marketing consulting pty limited australia 55 
upstream asia china consulting limited china 55 
beyond corporation limited england  51 
beyond international corporation 
usa 51  overview
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next fifteen communications group plc
annual report 2010
financial statements
 
 
85 
27 subsidiaries continued 
the above list does not include all the subsidiary companies of next fifteen communications group plc as the directors consider 
that to give full particulars of all group undertakings would lead to a statement of excessive length a full list of group undertakings 
will be included in the next annual return 
the principal activity of the subsidiary undertakings is public relations work specialising predominantly in the technology sector 
except for lexis public relations limited and m booth  associates inc which work for clients predominantly in nontechnology 
sectors redshift research limited which is a research company and beyond corporation limited and beyond international 
corporation which are digital consultancies  
all subsidiary undertakings operate in the country in which they have been incorporated  
all subsidiary undertakings listed are included in the consolidated results  
28 relatedparty transactions 
the ultimate controlling party of the group is next fifteen communications group plc incorporated in england and wales 
the company has a relatedparty relationship with its subsidiaries note 27 and with directors and executive officers 
transactions between the company and its subsidiaries have been eliminated on consolidation and are not disclosed in this note 
during the year to 31 july 2010 there were no other relatedparty transactions 
29 events after the balance sheet date 
type 3 limited 
on 4 august 2010 beyond corporation limited previously project metal limited acquired the entire issued share capital of 
ukbased type 3 limited and on the same date beyond international corporation previously context analytics corporation 
acquired the entire issued share capital of usbased type 3 limited both type 3 companies offer a fully integrated web design 
service and were acquired as part of the group’s strategy to build a digital consultancy the initial consideration paid in cash 
on completion was £300000 the group owns 51 of both beyond corporation limited and beyond international corporation 
together referred to as ‘beyond’ while the residual is owned by three employee shareholders the group has entered into a 
shareholders’ agreement under which the noncontrolling interest holders have the option to sell half of their shareholding back 
to the group in either october 2013 october 2014 or october 2015 based on the profitability of each business the consideration 
is uncapped by october 2015 the group will have acquired half of their shareholding bringing the group holding to 755  
acquisition costs of £89000 were paid in relation to the purchase of beyond of which £76000 were recognised in the 
consolidated income statement for the year ended 31 july 2010 and the remainder recognised in the consolidated income 
statement in august 2010  
glasshouse partnership limited  
on 1 september 2010 lexis public relations limited ‘lexis’ acquired the entire issued share capital of ukbased glasshouse 
partnership limited ‘glasshouse’ a corporate communications and marketing agency the initial consideration paid in cash on 
completion was £80000 contingent consideration may be payable on the first and second anniversary of completion subject to 
the achievement of certain revenue and staff metric performance targets the contingent consideration that may be payable will 
be satisfied by 60 cash and 40 next fifteen shares and is uncapped on 1 october 2010 the trade and assets of glasshouse 
were transferred to lexis  
acquisition costs of £15000 were paid in relation to the purchase of glasshouse and recognised within the consolidated income 
statement in august 2010   next fifteen communications group plc
annual report 2010
notes to the accounts continued 
 
86  
29 events after the balance sheet date continued 
onexeno limited 
on 1 september 2010 bite communications hong kong limited ‘bite’ acquired the trade and assets of digital marketing agency 
onexeno limited ‘onexeno’ a hong kong company the business was integrated into bite communications group limited’s 
existing asia pacific operation and will offer clients new levels of service expertise and digital communications tools in the region 
the initial consideration paid in cash on completion was hk1105000 £91000 with further uncapped consideration payable 
based on the revenue of retained clients over the 12 months following completion 
acquisition costs of hk14000 £1000 were paid in relation to the purchase of onexeno which were recognised in the 
consolidated income statement in the year ended 31 july 2010  
the blueshirt group llc 
on 1 november 2010 the group acquired an 85 stake in usbased investor relations company the blueshirt group llc 
‘blueshirt’ the acquisition of blueshirt complements the group’s existing businesses by providing financial and corporate 
communications expertise the initial consideration paid in cash on completion was us3000000 £1916000 contingent 
consideration will be paid over the course of four years based on a multiple of average profits and margin performance 
these contingent payments are estimated to total us8000000 £5108000 there is an option for the sellers to sell the 
remaining 15 stake in blueshirt after five years from completion and an option for next fifteen to acquire the remaining 15 
after six years from completion provided that the value of the business at the relevant time has reached a certain level  
acquisition costs estimated at around us85000 £54000 were recognised in the consolidated income statement in the year 
ending 31 july 2011  
information required in order to calculate and recognise goodwill fair value of assets and liabilities noncontrolling interest and 
acquired intangibles in relation to type 3 limited glasshouse onexeno and blueshirt is not yet available and will be shown in the 
interim report for the six months ending 31 january 2011  
  overview
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next fifteen communications group plc
annual report 2010
financial statements
company balance sheet 
as at 31 july 2010 
87 
  
 note 
2010 
£’000
2010  
£’000 
2009  
£’000 
2009 
£’000 
fixed assets    
tangible assets  3 1078  1013
investments  4 52931  15031
 54009  16044
current assets    
debtors amounts falling due within one year  5 8563 6916 
cash at bank and in hand  1507 3080 
 10070 9996 
current liabilities    
creditors amounts falling due within one year  6 13075 7890 
net current assets  3005  2106
debtors amounts falling due after more than one year – 33391 
total assets less current liabilities  51004  51541
creditors amounts falling due after more than one year 7 4072  35409
net assets  46932  16132
capital and reserves    
called up share capital  8 1401 1381 
share premium account  8 5575 5157 
merger reserve  8 3075 3075 
sharebased payment reserve  8 1277 671 
esop reserve  8 162 644 
treasury shares  8 595 595 
profit and loss account  8 36361 7087 
equity shareholders’ funds  46932  16132
these financial statements were approved and authorised for issue by the board on 12 november 2010  
w whitehorn  
chairman  
d dewhurst 
finance director 
company number 01579589 
  next fifteen communications group plc
annual report 2010
reconciliation of movements in shareholders’ funds 
for the year ended 31 july 2010 
88  
 
 
company  
2010  
£’000 
company  
2009  
£’000 
profitloss attributable to shareholders  30578 313 
dividends  932 900 
 29646 1213 
issue of shares  438 443 
movement on sharebased payment reserve  606 57 
disposal of own equity shares held in esop  110 63 
treasury shares  – 91 
net addition to shareholders’ funds  30800 855 
opening shareholders’ funds  16132 16987 
closing shareholders’ funds  46932 16132 
  overview
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next fifteen communications group plc
annual report 2010
financial statements
notes forming part of the company financial statements 
for the year ended 31 july 2010 
89 
1 accounting policies  
the financial statements have been prepared under the historical cost convention and are in accordance with applicable 
accounting standards in the united kingdom as permitted by section 408 of the companies act 2006 the company has not 
presented its own profit and loss account  
merger reserve  
in accordance with the provisions of merger relief under section 131 of the companies act 1985 section 612 of the companies 
act 2006 after 1 october 2009 where the company issues shares as part of an acquisition the company records the cost of the 
investment at the nominal value of the shares issued and records the excess of fair value over nominal value as a merger reserve 
this is applicable where equity interest is greater than 90 
tangible fixed assets  
tangible fixed assets are stated at cost net of depreciation depreciation is provided on all tangible fixed assets at annual rates 
calculated to write off the cost less estimated residual value of each asset evenly over its expected useful life as follows  
office equipment   20 – 50 per annum straightline  
computer software   14 – 20 per annum straightline  
the carrying values of tangible fixed assets are reviewed for impairment periodically if events or changes in circumstances indicate 
the carrying value may not be recoverable  
foreign currencies  
monetary assets and liabilities denominated in foreign currencies are expressed in sterling at the rate of exchange ruling at the 
balance sheet date foreign currency transactions are expressed in sterling at the rates of exchange ruling at the dates of the 
transactions exchange gains and losses and translation differences are taken directly to the profit and loss account  
financial instruments  
derivative financial instruments utilised by the company are interest rate capandcollar contracts and forward foreign exchange 
contracts the company does not enter into speculative derivative contracts all such instruments are used to alter the risk profile 
of an underlying exposure of the company in line with the group’s risk management policies premiums payable under foreign 
exchange contracts are expensed over the life of the contract and any gains and losses arising on these contracts are deferred 
and are recognised in the profit and loss account only when the protected transaction has itself been reflected in the company’s 
financial statements  
leasing transactions  
assets held under finance leases are included in the balance sheet the amount capitalised is the present value of the minimum 
lease payments depreciation on the relevant assets is charged to the profit and loss account over the shorter of the estimated 
useful economic life and the period of the lease the interest element on these obligations is charged to the profit and loss account 
so as to approximate a constant interest rate over the life of each agreement operating lease rentals are charged to the profit and 
loss account in equal amounts over the lease term  
pension costs  
pension costs which relate to payments made by the company to employees’ own defined contribution pension plans are 
charged to the profit and loss account as incurred  
investments  
fixed asset investments are stated at cost less provisions for impairment   next fifteen communications group plc
annual report 2010
notes forming part of the company financial statements continued 
 
90  
1 accounting policies continued 
deferred taxation  
deferred tax is provided in full on timing differences which result in an obligation at the balance sheet date to pay more tax 
or a right to pay less tax at a future date at rates expected to apply when they crystallise based on current tax rates and law 
timing differences arise from the inclusion of items of income and expenditure in tax computations in periods different from 
those in which they are included in the financial statements deferred tax is not provided on timing differences arising from 
the revaluation of fixed assets where there is no commitment to sell the asset or on unremitted earnings of subsidiaries where 
there is no commitment to remit these earnings deferred tax assets are recognised to the extent that it is regarded as more 
likely than not that they will be recovered deferred tax assets and liabilities are not discounted  
sharebased employee remuneration  
there are share options granted prior to 7 november 2002 which remain outstanding at 31 july 2010 details of all grants are 
disclosed in note 22 of the consolidated financial statements  
fair value is measured by use of a blackscholes model on the grounds that there are no marketrelated vesting conditions 
the expected life used in the model has been adjusted based on the board’s best estimate for the effects of nontransferability 
exercise restrictions and behavioural considerations details of the riskfree rate and dividend yield used to underpin these 
assumptions are included in note 21 of the consolidated financial statements the market price on the grant date is obtained 
from external publicly available sources  
employee share ownership plan  
the cost of the company’s shares held by the esop is deducted from shareholders’ funds in the company and company balance 
sheet any gain or loss made by the esop on disposal of the shares it holds is also recognised directly in shareholders’ funds 
other assets and liabilities of the esop including borrowings are recognised as assets and liabilities of the company  
finance costs  
finance costs are charged to profit over the term of the debt so that the amount charged is at a constant rate on the carrying 
amount finance costs include issue costs which are initially recognised as a reduction in the proceeds of the associated capital 
instrument  
dividends  
equity dividends are recognised when they become legally payable interim equity dividends are recognised when paid 
final equity dividends are recognised when approved by the shareholders at an annual general meeting as required by frs 21 
events after the balance sheet date  
dividends receivable from investments are recognised in the profit and loss account in the period in which they are paid  
treasury shares  
when the company reacquires its own equity instruments those instruments treasury shares are deducted from equity no gain 
or loss is recognised in the profit and loss account on the purchase sale issue or cancellation of the company’s treasury shares 
such treasury shares may be acquired and held by other members of the group consideration paid or received is recognised 
directly in equity 
cash flow statement  
the company has applied the exemption allowed under frs 1 and has not presented a cash flow statement the cash flow 
statement has been presented in the group financial statements  
2 profit and loss account of the parent company  
the parent company’s profit after tax for the financial year was £30578000 2009 loss of £313000 this includes a gain 
of £28566000 in relation to the waiver of amounts owed to subsidiary undertakings as part of an intercompany debt 
simplification exercise  overview
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next fifteen communications group plc
annual report 2010
financial statements
 
 
91 
3 tangible assets  
 
office  
equipment  
£’000 
computer 
software  
£’000 
total 
£’000
cost    
at 1 august 2009 468 1284 1752
additions  92 176 268
at 31 july 2010 560 1460 2020
accumulated depreciation    
at 1 august 2009 454 285 739
charge for the year  34 169 203
at 31 july 2010 488 454 942
net book value    
at 31 july 2010  72 1006 1078
at 31 july 2009  14 999 1013
4 investments 
 
company 
equity interest 
in subsidiaries 
£’000
cost  
at 1 august 2009 15031
additional investment in subsidiary undertakings
1
 37900
at 31 july 2010 52931
1
the additional investment relates to ordinary share capital issued by a subsidiary undertaking in exchange for the assignment by the company of an amount due from 
a fellow subsidiary 
the directors consider the value of investments in subsidiary undertakings to be not less than that stated in the balance sheet 
of the company  
the group’s principal subsidiaries are listed in note 27 of the consolidated financial statements  
5 debtors   
 
company  
2010  
£’000 
company 
2009 
£’000 
amounts falling due within one year   
amounts due from subsidiary undertakings  8336 6437
other debtors  93 91
prepayments and accrued income  82 78
corporation tax recoverable  – 223
deferred tax asset  19 39
other taxation 33 48
 8563 6916
amounts falling due after more than one year   
amounts due from subsidiary undertakings
1
 – 33391
total debtors  8563 40307
1
the amounts due from subsidiary undertakings were assigned to a fellow subsidiary undertaking during the year ended 31 july 2010  next fifteen communications group plc
annual report 2010
notes forming part of the company financial statements continued 
 
92  
6 creditors amounts falling due within one year   
 
company  
2010  
£’000 
company  
2009  
£’000 
overdraft  2907 2344 
bank loans
1
 4917 156 
obligations under finance leases  54 118 
trade creditors  227 191 
amounts owed to subsidiary undertakings  4471 5015 
corporation tax 389 – 
other taxation and social security  23 34 
other creditors  41 32 
accruals and deferred income  46 – 
 13075 7890 
1
the 2010 company figure of £4917000 comprises £4821000 in relation to a £5000000 revolvingloan facility at an interest rate of 125 above barclays bank’s callloan 
rate and £96000 in relation to a £252000 loan at an interest rate of 650 
7 creditors amounts falling due after more than one year  
 
company  
2010  
£’000 
company  
2009  
£’000 
bank loan
1
 2139 4922 
obligations under finance leases  19 77 
amounts owed to subsidiary undertakings
2
  1914 30410 
 4072 35409 
1
the 2010 company figure of £2139000 is in relation to a £6000000 revolvingloan facility at an interest rate of 225 above barclays bank’s callloan rate 
the bank loans are valued at the net proceeds drawn down at the exchange rates ruling at the time they are drawn the foreign currency element of the loans is revalued 
at the prevailing rate at 31 july 2010  
2
see note 2 
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financial statements
 
 
93 
8 reserves 
 
share 
capital  
£’000 
share 
premium 
account 
£’000
merger 
reserve 
£’000
share
based 
payment 
reserve 
£’000
esop 
reserve  
£’000 
treasury 
shares  
£’000 
profit  
and loss  
account  
£’000 
total 
£’000
at 1 august 2008 1354 5157 2659 728 663 504 8256  16987 
loss attributable to shareholders – – – – – – 313 313
dividends  – – – – – – 900 900
shares issued on acquisitions
1
 27 – 416 – – – – 443
movement in relation to  
sharebased payments – – – 57 – – – 57
investment in own shares – – – – – 91 – 91
movement due to esop share  
option exercises – – – – 19 – 44 63
at 31 july 2009 1381 5157 3075 671 644 595 7087 16132
profit attributable to shareholders – – – – – – 30578 30578
dividends  – – – – – – 932 932
shares issued on acquisitions
2
 20 418 – – – – – 438
movement in relation to  
sharebased payments – – – 606 – – – 606
movement due to esop share  
option exercises – – – – 482 – 372 110
at 31 july 2010 1401 5575 3075 1277 162 595 36361 46932
1
in respect of lexis public relations limited 
2
in respect of 463 communications llc 
 
  next fifteen communications group plc
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fiveyear financial information 
for the year ended 31 july 2010 unaudited 
94  
 
 
2010
ifrs
£’000
2009
ifrs
£’000 
2008 
restated
ifrs
£000 
2007 
ifrs  
£000 
2006  
restated  
uk gaap  
£000 
profit and loss    
billings  91175 77287 73916 69422 63278 
net revenue  72328 65394 63107 59268 56007 
operating profit before amortisation  
and impairment 7386 4363 6230 5737 3995 
amortisation and impairment 878 513 113 44 727 
operating profit after amortisation  
and impairment 6508 3850 6117 5693 3268 
net interest payable  1204 692 718 627 265 
profit before income tax  5304 3158 5516 5122 3003 
income tax expense  1591 884 1655 1781 1494 
profit for the year  3713 2274 3861 3341 1509 
noncontrolling interests  38 342 198 241 179 
profit attributable to owners of the parent  3675 1932 3663 3100 1330 
dividend per share p  185 170 170 150 1365 
balance sheet    
noncurrent assets 31919 22618 20206 18442 14343 
net current assets  4222 7603 5303 5224 7233 
creditors amounts falling due after  
more than one year  8562 5319 5871 8684 6834 
provisions for liabilities and other charges 58 282 – – – 
net assets  27579 24902 19638 14982 14742 
total equity attributable to owners of the parent  26629 24147 19392 14784 14742 
noncontrolling interests 950 755 246 198 – 
total equity  27579 24902 19638 14982 14742 
cash flow    
group operating profit  6508 3850 6117 5693 3094 
depreciation and amounts written off 
intangible assets  1938 1681 1316 1465 2176 
other noncash items and working capital  1874 730 2166 45 322 
cash flow from operating activities  6572 6261 9599 7203 4948 
returns on investments and servicing of finance  380 342 240 311 325 
taxation  1465 1476 1090 1992 2430 
capital expenditure and investing activities  1461 509 2153 1246 1203 
acquisitions and disposals  4251 4549 829 1959 2354 
equity dividends paid  932 900 807 691 590 
financing  2044 1513 994 1193 2919 
noncontrolling interest dividend paid 256 226 – – – 
decreaseincrease in cash for the year  129 3254 3486 2197 965 
 
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95 
 
final dividend  interim dividend 
exdividend date 5 january 2011 interim results announcement 5 april 2011
record date 7 january 2011 exdividend date 13 april 2011
annual general meeting  25 january 2011 record date 15 april 2011
payment of 2010 final dividend 4 february 2011 payment of 2011 interim dividend 16 may 2011
 
 
preliminary results 
 fullyear results announcement 18 october 2011
 
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limited 
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upstream asia china consulting ltd 
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singapore 
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pty ltd 
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100  
lexis public relations 
wwwlexisprcom 
lexis public relations limited 
8 bolsover street 
london w1w 6ab 
united kingdom 
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f 44 020 7908 6490 
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www463com 
463 communications 
washington dc 
463 communications llc 
1150 17th street 
suite 310 
washington dc 20036 
usa 
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f 1 202 463 0023 
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wwwredshiftresearchcouk 
redshift research ltd 
commotion house 
morley road 
tonbridge 
kent tn9 1ra 
united kingdom 
t 44 01732 356 399 
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wwwbyndcom 
uk 
beyond london 
beyond corporation limited 
8 bolsover street 
london w1w 6ab 
united kingdom 
t 44 020 7908 6555 
us and canada 
beyond san francisco 
beyond international corporation 
77 maiden lane  
3rd floor  
san francisco ca 94108  
usa  
t 1 415 593 8499  
f 1 415 593 8401 
beyond new york 
beyond international corporation 
300 park avenue south 
new york ny 10010 
usa 
t 1 347 687 1019 
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wwwblueshirtgroupcom 
blueshirt san francisco 
the blueshirt group llc 
456 montgomery street 
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usa 
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i	
	 what do you think
	 visit 	 our	 website	 	
	 w wwnextfifteencom	 	
	 a nd	 give	 us	 your	 	 	
	 thoughts
next fifteen continues to look at the most  
effective way to communicate with its  
shareholders and other stakeholders following 
positive feedback we have once again created 
an enhanced online annual report that can be 
found on our website wwwnextfifteencom and 
would urge you to take a look at the case studies 
showing some of the work we do for our clients
it would be great to hear feedback from shareholders 
on the annual report or any other aspect of the  
business we would be happy to answer questions 
from shareholders at any time rather than waiting  
for the annual general meeting in january
we look forward to hearing from you
tim dyson	 chief	 executive	 officer
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Summary:
 last year i wrote that there was no substitute 
for doing great work i also referenced the growing 
role digital communications was playing in the 
marketing world in the last 1 2 months digital 
has become the focus of all forms of marketing 
as companies grapple with the shift away from 
traditional media towards social networks social 
media and the growing consumption of webbased 
content from both traditional and completely new 
sources this is a shift that creates a great opportunity 
for an agency group like ours it is forcing brands 
to completely rethink the way they tackle their 
marketing in the past brands have ‘controlled’ their 
messaging and brand positioning through a series 
of controlled events such as placed advertising 
press conferences and product placement today 
consumers are starting their own conversations 
about products and brands on places such as 
facebook or on vertical social networks through 
ning or grouply as a result brands now have 
to fi gure out how to shape a conversation they 
didn’t start and can’t control these are in short 
exciting times
digital from every angle
against this backdrop of change the agency world 
has had to cope with global economic uncertainty 
making the bets we have had to take feel all the 
more challenging i’m pleased to report that as a 
group our results show that we are already seeing 
returns on the investments made in digital and i am 
excited to see the doors that digital is starting to 
open for our business we are approaching digital 
from every angle we are embedding digital thinking 
and products into our traditional services but we 
have also created a specialist digital agency to off er 
advanced digital services to all the group’s clients 
this new agency is called appropriately beyond and 
it has offi  ces in london san francisco and new york 
it brings together traditional web developers 
graphic designers analysts search specialists and 
pr consultants in the creation of a set of services that 
are closer to digital advertising than pr in the way 
they look but fully embrace the infl uence model at 
the core of public relations this may be why it has 
already secured clients that include cisco virgin 
america google and hilton hotels
more than just technology
when the dot com bubble burst in 2001 we were 
a technology specialist group today we derive a 
quarter of our revenues from clients that include 
unilever boots hersheys and most recently dyson 
and no i’m not related in the next few years we will 
look to invest in the corporate pr and healthcare 
arena further diversifying our clientbase while still 
remaining highly specialised in the services we off er 
these customers these moves coupled with the 
continued expansion of the technology industry 
ensure that there is no reason why our business 
should stop expanding
chief executive offi  cer’s review
73 2
number of clients 
2009 626
854
average number of staff 
2009 847
48
offi  ces worldwide 
2009 43
see pages 45 for 
more on our brands
             p
08
next fifteen communications group plc
annual report 2010
13938ra10p0129indd   08 13938ra10p0129indd   08 16112010   1214 16112010   1214 global hasn’t gone away
while our industry has been tackling digital it can’t 
ignore the importance of emerging markets and
the desire of large companies to manage their 
communications globally these shifts are 
understandable first the importance of markets 
such as china and india cannot be overstated right 
now second the shift towards the internet being 
the new platform for communications is breaking 
down traditional geographic borders particularly in 
developed countries this is why we have continued 
to invest in emerging markets with the acquisitions 
of upstream asia that extends our bite business 
into the asia pacifi c region and of onexeno which 
adds to our ability to provide digital services in 
those markets
more growth to come
while there is still some uncertainty around the 
global economy i am confi dent that our business 
will deliver robust growth in the coming year 
the investments of the last few years are already 
providing revenue growth and that will only 
continue which should again lead to record results 
in the year to 31 july 201 1 to be in this position is 
testament to the quality of the businesses that make 
up the group and the decisions they’ve made 
i’m pleased to say that all of our businesses are set 
to expand which should only be good news for 
our shareholders 
to end this review i would like to thank all the 
people who make up next fifteen for their eff orts 
in the last year to deliver the strong recovery we 
achieved i would also like to thank you as 
shareholders for your continued support 
we have ambitious plans for the group which 
we hope you will all be a part of
“ in the last 1 2 
months digital 
has become the 
focus of all forms 
of marketing as 
companies grapple 
with the shift away 
from traditional 
media”
tim dyson
chief executive offi  cer 
12 november 2010
follow tim on twitter
timdyson
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13938ra10p0129indd   09 13938ra10p0129indd   09 16112010   1214 16112010   1214