wwwlupuscapitalcouk
lupus capital plc
annual report  
accounts 2010
lupus capital plc
65 buckingham gate
london sw1e 6as
44 020 7976 8000
wwwlupuscapitalcouk
lupus capital plc annual report  accounts 2010 contents
01 highlights
02 our business at a glance 
04 chairman’s statement
06  chief executive officer’s and chief  
financial officer’s review
08 business review
12 principal risks and uncertainties
14  corporate social responsibility report
16 board of directors
18 directors’ report 
20 corporate governance
23 directors remuneration report
29 independent auditors’ report
30  consolidated income statement
31  consolidated statement of  
comprehensive income
31  consolidated statement of changes 
in equity
32 consolidated balance sheet
33 group cash flow statement
34  notes to the financial statements
60 independent auditor’s report
61 company balance sheet
62 notes to the company financial  
 statements
65 advisers
65 definitions
65 roundings
65 exchange rates
66 notice of annual general meeting
71 form of proxy
lupus capital plc is a leading international supplier of building 
products to the door and window industry and the world’s 
number one manufacturer of marine breakaway couplings 01
lupus capital plc
annual report  accounts 2010
highlights ⁄
operational highlights total group
healthy growth in sales and operating  ⁄
profit despite flat building products 
markets
sustained improvements in gross and  ⁄
net margins
underlying earnings per share  ⁄
increased by 36 per cent to 1306p 
operating cash conversion in year of  ⁄
105 per cent
underlying net debt reduced to   ⁄
£947 million
resumption of dividend payments ⁄
sales
£2662m
2009 £2416m  10
gross profit margin
349
2009 333
underlying operating profit
£337m
2009 £256m 32
underlying operating margin
126
2009 106
underlying eps
1306p
2009 939p 39
dividend per share
20p
2009 nil
underlying net debt
£947m
2009 £1162m 19 02
lupus capital plc
annual report  accounts 2010
our business at a glance ⁄
1
us building  
products
sales
£1 1 7 2m
2009 £1057m 11
underlying operating profit
£144m
2009 £108m 33
amesbury
our us building products division operates as 
the amesbury group with manufacturing and 
distribution capability throughout the usa 
amesbury offers the complete range of door 
and window sealing solutions and hardware
amesbury is america’s leading manufacturer  
of door and window seals with brands such  
as foamtite
®
 and schlegel’s qlon
®
 and 
highquality textile offerings in addition 
amesbury manufactures custom thermoplastic 
extrusions and multidurometer profiles
amesbury also manufactures block and tackle 
and constant force window balances for single 
and doublehung windows and is a leading 
door hardware distributor
building products manufacturing
building products sourcing 
distribution
gall thomson
americas uk  continental europe
asia  australasia
see page 8 for more details 03
lupus capital plc
annual report  accounts 2010
see page 9 for more details
sales
£947m
2009 £797m 19
underlying operating profit
£7 9m
2009 £63m 26
grouphomesafe
our uk building products division operates 
as grouphomesafe grouphomesafe is 
a leader in the design development 
manufacture and distribution of innovative 
solutions to improve performance and 
enhance protection and security for the 
residential building and home 
improvement markets 
grouphomesafe provide a wide range of 
products and solutions including window 
and door hardware sash window 
renovation composite doors and weather
stripping seals
see page 10 for more details
sales
£398m
2009 £367m 8
underlying operating profit
£45m
2009 £26m 74
schlegel
we operate in a number of countries 
worldwide with manufacturing sites in 
germany spain belgium and australia 
and numerous distribution and sourcing 
operations this gives us a unique insight 
into local markets and offers the potential 
to sell our extensive product range 
internationally
our core brand internationally is schlegel 
whose seals are sold in more than 75 
countries around the world also 
manufactured are related products such as 
cleaning brushes static control devices for 
copiers and printers speciality automotive 
products such as sunroof seals and truck 
spray suppressants tractor seat trim and 
sway bar bushes
see page 10 for more details
sales
£137m
2009 £126m 9
underlying operating profit
£68m
2009 £59m 16
gall thomson
gall thomson is the world’s leading 
supplier of marine breakaway couplings 
its subsidiary klaw is a supplier of 
industrial couplings including quick release 
couplings and breakaway couplings
a gall thomson marine breakaway 
coupling is used in the oil and gas industry 
to enable a loading line to part safely and 
then to shut off the product supply in the 
event of a vessel moving off station during 
the loading or discharging of oil and gas 
products whether at offshore moorings or 
jetty terminals the purpose of the 
breakaway coupling is to prevent 
environmental pollution without damage to 
pumping and transfer equipment
2 3 4
uk building  
products
international  
building products
oil services 04
lupus capital plc
annual report  accounts 2010
jamie pike
chairman
sales
£2662m
2009 £2416m  10
underlying operating profit
£337m
2009 £256m 32
underlying operating margin
126
2009 106
sales by sector
2010 operating profit by sector
total sales – £2662m
 uk bp 357
 us bp 441
 int’l bp 150
 gt 52
total operating  
profit – £337m
 uk bp 234
 us bp 429
 int’l bp 134
 gt 203
 chairman’s  ⁄
statement
overview
2010 was an encouraging year for lupus despite the building 
products markets in the us uk and europe continuing to show 
little growth our strategy of self help involving focused customer 
service tight cost control supply chain efficiencies and 
management of working capital has enabled the group to gain 
market share and make further progress in what remains a highly 
competitive environment gall thomson our oil and gas services 
business enjoyed another year of excellent performance
during the year the group appointed a new executive team in 
louis eperjesi and james brotherton completing the board 
restructuring that began in 2009
the board is pleased that the group is now in a position to 
resume dividend payments to shareholders reflecting the 
improved operational performance of the group underpinned  
by consistent cash conversion
2011 is not expected to deliver material improvement in conditions 
in building products markets and significant input cost pressures 
are expected to continue for the foreseeable future however  
our strong market positions combined with our balance sheet 
strength quality of product and service offering and focus on 
market share growth through self help initiatives means that the 
group is well positioned to maintain margins and take advantage 
of any sustained increase in activity levels
financial performance in the period
total sales of £2662 million increased by 102 per cent from prior 
year 2009 £2416 million in constant currency terms on a like for 
like basis total sales increased in the year by 124 per cent 
despite challenging trading conditions and increasing raw material 
costs the group’s gross profit margin increased to 349 per cent 
from 333 per cent in 2009 the dropthrough margin on 
incremental sales for the year was 328 per cent underlying 
operating profit increased by 316 per cent to £337 million 2009 
£256 million underlying earnings per share increased by 367 
pence or 391 per cent to 1306 pence 2009 939 pence
during the year the group continued to focus on the tight 
management of working capital operational cash generation and 
the reduction of net debt despite the 102 per cent increase in 
sales in 2010 the group generated £17 million cash from net 
working capital reductions 2009 £107 million operating cash  05
lupus capital plc
annual report  accounts 2010
balance sheet strength and capital investment plans as well  
as the requirement to comply with the terms of the group’s  
facility agreements
the final dividend of 20 pence 2009 nil pence per share is 
recommended for payment on 7 june 2011 to shareholders on the 
register at the close of business on 3 may 2011 the exdividend 
date will be 27 april 2011
outlook
our building products division has made a steady start to 2011 
with sales and orders broadly in line with 2010 although the 
seasonal nature of the businesses and short order books means 
that the first quarter offers little visibility on the full year
2011 is not expected to deliver material improvement in conditions 
in our key building products markets and significant input cost 
pressures are expected to continue for the foreseeable future 
however our strong market positions combined with balance 
sheet strength quality of product and service offering and focus 
on market share growth through self help initiatives means that the 
group is well positioned to take advantage of any sustained 
increase in activity levels
our oil and gas services division continues to see increasing 
demand for its mbc and industrial coupling products and has a 
very strong order book coming into 2011
we expect the group will continue to make further progress during 
2011 from a sound financial platform
jamie pike
chairman 
23 march 2011
conversion being the proportion of underlying operating profit 
converted into cash exceeded 100 per cent at 105 per cent in 
2010 2009 142 per cent during 2010 the group repaid £211 
million of debt to bring the total debt repayments made since the 
refinancing in july 2009 to £414 million at 31 december 2010 the 
group’s underlying net debt was £947 million which was £215 
million lower than prior year 2009 £1162 million
board
there were a number of changes to the board during the year 
louis eperjesi was appointed as chief executive officer in 
february 2010 and james brotherton was appointed as chief 
financial officer in may 2010 there are three independent 
nonexecutive directors jamie pike chairman les tench and 
martin towers
james brotherton was appointed as a director after the 2010 
annual general meeting and so is required to offer himself for 
reelection at the 2011 annual general meeting in accordance with 
best practice the board have agreed that each director will 
voluntarily offer themselves for reelection at each annual general 
meeting that they are not required to retire from office accordingly 
jamie pike louis eperjesi les tench and martin towers will 
voluntarily offer themselves for reelection at the 2011 annual 
general meeting
dividends
lupus is a cash generative business operating in mature markets 
and in the ordinary course would expect to pay a regular dividend 
to shareholders the banking arrangements entered into in june 
2009 precluded the payment of dividends by the group until both 
group and subsidiary net debt ratios had reduced
over the past two financial years the focus of the group has been 
on deleveraging the balance sheet and utilising surplus cash in the 
permanent paydown of debt the outcome of this focus is a 
significantly strengthened balance sheet underpinned by 
sustained trading performance and means that the group now has 
the consent of its banks to make a modest dividend payment 
accordingly the board is recommending to shareholders the 
payment of a final dividend of 20 pence per share the final 
dividend will absorb approximately £26 million of cash resources
over time the absolute level of future dividend payments will  
take into account the group’s underlying earnings cash flows 
over the past two financial years the focus  ⁄
of the group has been on deleveraging the 
balance sheet and utilising surplus cash in the 
permanent paydown of debt the outcome of 
this focus is a significantly strengthened balance 
sheet underpinned by sustained trading 
performance and means that the group now 
has the consent of its banks to make a modest 
dividend payment  chief executive  ⁄
officer’s and  
chief financial 
officer’s review
06
lupus capital plc
annual report  accounts 2010
underlying net debt £m
80
100
120
140
160
dec 10 dec 08 jun 09 dec 09 jun 10
before capitalised fees
group 2010 operational performance
during 2010 we remained focused on maintaining tight controls 
over costs in all our businesses headcount at 31 december 2010 
of 2004 was in line with the prior year 2009 2003 as we flexed 
labour where necessary and permitted limited selective hiring of 
permanent personnel only where merited by business activity 
levels significant increases in raw material prices were seen during 
the year most notably in steel and oil derivative products and local 
management were diligent in passing these on to customers in 
order to protect our gross margins 
throughout 2010 we have continued to reassess and flex our 
global production footprint to optimise our margins and improve 
our customer offering the conversion of our chinese 
manufacturing operation to a sourcing operation in february 2010 
has allowed us greater flexibility in obtaining the lowest cost 
highest quality product production levels at the group’s mexican 
operation have been significantly increased during the year and we 
vacated our site at tipton in the west midlands building work has 
started in sioux falls south dakota for a planned expansion to 
consolidate our sioux falls door hardware and balance 
manufacturing businesses onto a single site this is expected to be 
completed during 2011
we have continued our focus on tight management of working 
capital despite increased turnover we successfully increased our 
stock turn in 2010 and reduced our investment in inventory held at 
the year end during the year a number of our customers ceased 
trading however vigilant management of customer credit risks 
throughout the year starting at the point of sale meant that bad 
debts written off amounted to only 01 per cent of sales 2009 03 
per cent 
we continue to promote the financial strength of the group to the 
credit insurers of our major suppliers in order to optimise the credit 
terms that we receive from our supplier base and to work closely 
with our customer base to ensure we understand their balance 
sheet position and creditworthiness
financial performance in the period
for the year ended 31 december 2010 compared with the prior 
year
sales
total sales of £2662 million increased by 102 per cent from prior 
year 2009 £2416 million in constant currency terms on a like for 
like basis total sales increased in the year by 124 per cent 
margins
despite challenging trading conditions and increasing raw material 
costs the group’s gross profit margin increased to 349 per cent 
from 333 per cent in 2009 the underlying operating margin for 
the group increased from 106 per cent in 2009 to 126 per cent 
in 2010 
the group continued to flex its cost base in line with demand such 
that the dropthrough margin on incremental sales in the year was 
328 per cent
james brotherton
chief financial officer
louis eperjesi
chief executive officer
we have continued  
our focus on tight 
management of working 
capital despite 
increased turnover we 
successfully increased 
our stock turn in 2010 
and reduced our 
investment in inventory 
held at the year end  07
lupus capital plc
annual report  accounts 2010
during 2010 the group repaid £21 1 million of  ⁄
debt to bring the total debt repayments made 
since the refinancing in july 2009 to £414 million
cash flow
despite the 102 per cent increase in sales in 2010 the group 
generated £17 million cash from net working capital reductions 
2009 £107 million these reductions combined with the 
increased operating profit generated by the group meant that the 
net cash inflow from operating activities of £363 million remained 
broadly in line with prior year 2009 £365 million 
operating cash conversion being the proportion of underlying 
operating profit converted into cash exceeded 100 per cent at 
105 per cent in 2010 2009 142 per cent 
capital expenditure increased by 57 per cent to £35 million 2009 
£22 million 
net debt position
during 2010 the group repaid £211 million of debt to bring the 
total debt repayments made since the refinancing in july 2009 to 
£414 million 
at 31 december 2010 the group’s underlying net debt was £947 
million which was £215 million lower than prior year 2009 £1162 
million despite adverse exchange rate movements increasing net 
debt by £20 million 
average underlying net debt during the year was £1139 million 
2009 £1356 million under the ifrs definition which reduces 
debt by the unamortised bank fees net debt at the year end was 
£917 million 2009 £1110 million
banking
at 31 december the group had headroom against its banking 
covenants ranging from 47 per cent to 75 per cent and the board 
remains confident that the group will continue to operate within its 
banking covenants as set out in the current banking facility 
agreements which expire in july 2012 
the group’s key banking performance metric being the  
proportion of net debt to underlying ebitda at the year end  
was 238x 2009 366x calculated on the same basis as the 
banking covenants
defined benefit pension and post retirement benefit schemes
the group’s principal defined benefit pension scheme and post 
retirement healthcare benefit scheme is operated in the us the 
pension scheme is closed to new entrants and post retirement 
healthcare benefit contributions are capped
at 31 december 2010 the defined benefit obligation for all group 
pension and post retirement healthcare benefit schemes was 
£189 million 2009 £174 million and the schemes had plan assets 
of £116 million 2009 £99 million resulting in a slightly reduced 
net deficit on the schemes of £73 million 2009 £75 million
louis eperjesi   james brotherton
chief executive officer  chief financial officer
23 march 2011
profits
underlying earnings before interest tax depreciation and 
amortisation were £402 million 2009 £323 million 
underlying operating profit increased by 316 per cent to £337 
million 2009 £256 million on a constant currency basis this 
represents an increase of 304 per cent over the prior year 
underlying administrative expenses increased by £42 million or 77 
per cent to £591 million 2009 £549 million administration costs 
included higher freight commission and management incentive 
costs associated with the increased levels of activity and higher 
legal costs associated with defence of intellectual property rights
net finance costs decreased by £06 million to £120 million 2009 
£126 million reflecting reduced debt levels the 2009 interest rate 
benefited from the lower margins payable on the group’s facilities prior 
to the refinancing in july 2009 net cash interest paid of £93 million 
2009 £105 million was 12 per cent lower than that paid in 2009
fair value losses on financial instruments increased by £09 million 
in 2010 due to outofthemoney interest rate hedges taken out in 
2007 that did not expire until 30 september 2010 during the year 
the group entered into a number of interest rate swap transactions 
which had the economic effect of fixing the group’s cost of funds 
before the applicable margin at between 185 and 2045 per cent 
until july 2012
underlying profit before taxation was 561 per cent higher at £245 
million 2009 £157 million
earnings per share
underlying earnings per share increased by 367 pence or 391 per 
cent to 1306 pence 2009 939 pence basic earnings per share 
increased from 032 pence in 2009 to 543 pence 
exceptional costs
exceptional costs of £04 million 2009 £21 million were incurred 
during the period principally in connection with the outsourcing of 
further activity from the uk to china and the general meeting held 
in february 2010
taxation
the tax charge increased to £25 million in 2010 2009 tax  
credit £11 million excluding the effect of the change in tax  
rates on deferred tax assets and the adjustments in respect of 
prior periods the underlying tax rate on the underlying profit 
before taxation was 32 per cent 2009 28 per cent the 
underlying tax rate increased during 2010 due to the geographic 
mix of profit growth 
the underlying cash tax rate in the year was 9 per cent 2009 14 
per cent and is lower than the underlying tax rate due to historic 
losses the underlying cash tax rate is expected to trend towards 
the underlying tax rate over the coming years
financial position
during the year the group continued to focus on the tight 
management of working capital operational cash generation and 
the reduction of net debt  08
lupus capital plc
annual report  accounts 2010
business review ⁄
 hardware 
£623m 24
 reinforcer 
£233m 9
 extrusions 
£168m 6
 balances 
£387m 15
sales by product
 composite doors 
£182m 7
 foam sealing 
£490m 18
 pile sealing 
£403m 15
 other 
£37m 1
 oil services 
£137m 5
metres of pile seals sold
4721m
 
metres of foam seals sold
1958m
 
window balances sold
407m
 
locks sold
325m
 
marine breakaway couplings sold
78
 
building products
the building products division comprises the group’s door and 
window hardware and seals operations the division’s businesses 
are market leaders and operate across the americas the uk 
europe and asia in 2010 trading in our building products 
businesses recovered significantly against a background of 
broadly flat markets
us building products
the amesbury group our north american building products 
business continued its sales led recovery through a combination 
of customers rebuilding inventories and net gains in market share 
despite relatively sluggish markets we estimate that new build 
activity in the us market increased by around 6 per cent across 
the year as a whole with demand skewed towards the first quarter 
as a consequence of the homebuyer tax credit that expired in 
april 2010 we estimate that repair and remodelling activity 
which constitutes approximately 70 per cent of the market 
increased by around 4 per cent over the year and was supported 
particularly in the final quarter by the 1500 tax credit for the 
installation of energy efficient windows which expired on  
31 december 2010 
our us business was less affected by commodity input prices 
than other businesses during 2010 as it procures key commodities 
on longterm contracts and agrees surchargediscount 
arrangements with key customers by reference to third party indices
key initiatives in the year included the expansion of the national 
accounts program to leverage our product offering within the 
north american customer base the continued ramp up of 
manufacturing at the group’s mexican facility and a restructured 
approach to amesbury marketing
intumescent seal
qlon fire rated door seal  
is an allinclusive seal that 
combines the superior 
performance of qlon to resist 
air water and sound penetration 
with the fire and smoke 
protection provided by category 
g and h rated gaskets 09
lupus capital plc
annual report  accounts 2010
uk building products
our uk building products business grouphomesafe generated 
encouraging sales by increasing market share in 2010 despite the 
depressed nature of some of our end markets while new build 
activity in the uk market was up by around 30 per cent we 
estimate that repair maintenance and improvement activity which 
constitutes approximately 95 per cent of the market decreased by 
around 5 per cent
the weakness of sterling and increases in the prices of imported 
raw materials and finished goods produced significant input cost 
pressures during the year these pressures were mitigated by an 
unwavering focus on cost down initiatives and prompt action to 
increase prices of the 19 per cent increase in total sales year on 
year approximately half of this increase was due to price 
increases despite input cost pressures and the losses incurred 
within our composite doors business the underlying operating 
margin for grouphomesafe improved slightly in the year
during the period we have consolidated our uk sales force teams 
into a single customer facing unit and successfully launched 
“grouphomesafe” as the new umbrella brand for our uk building 
products business these initiatives have been well received by both 
customers and employees and have generated incremental sales 
during the second half of the year for the group 2010 has also seen 
an increased focus on improving our customer service within the uk 
market as we seek to differentiate ourselves from the competition 
by setting industry leading standards for delivery on time and in full
our composite door business which is principally focused on 
the social housing market experienced a significant decrease in 
demand during the second half of 2010 and was loss making 
across the year as a whole demand for composite doors within 
the social housing market is expected to continue to weaken into 
2011 in 2010 actions were taken to reduce the cost base flex 
labour in line with sales streamline manufacturing processes 
improve customer service levels and redirect the sales focus into 
building an increased share of the growing trade and retail 
composite door markets the composite doors business has now 
been fully integrated into the wider grouphomesafe business and 
this should assist the business to access the grouphomesafe 
customer base taken together these measures mean that the 
composite door business is much better positioned to cope with 
the structural changes seen in its end markets and we expect an 
improved performance from the business in 2011
double locking nightlatch
designed to replace most existing front door 
locks it has been designed with an ergonomic 
internal locking handle offering added security 
against forced entry the main 
lock bolt is “automatically” 
deadlocked when the door is 
closed preventing the main 
bolt being retracted by a 
credit card
ventrolla help sarah beeny restore the windows at her grade 
ii listed georgian mansion
as part of the channel four series “beeny’s restoration nightmare” 
ventrolla our sash window renovation business renovated over 100 
windows in her grade ii listed georgian mansion rise hall including 
one large window spanning two floors sarah said “ventrolla were 
the first port of call when i needed to complete the huge task of 
restoring all the windows at rise hall having worked with them 
previously i knew they would work wonders on improving both the 
look and energy efficiency of the windows” 10
lupus capital plc
annual report  accounts 2010
business review ⁄
international building products
our international building products division which goes to market 
under the schlegel brand has seen sales increase in 2010 
compared with the corresponding period last year with 
encouraging increases in demand in australasia south america 
scandinavia and eastern europe tempered by weaker demand for 
products in southern europe the geographic mix of the sales 
growth combined with high levels of operational gearing 
enhanced the division’s overall margins 
 
during the year our continued focus on cross selling opportunities 
achieved some notable successes in our australian operation 
demand was also boosted by australian government incentives for  
first time buyers the strength of the australian dollar reduced 
import costs and increased the translated results of the 
australian operation 
we have also bolstered our presence in south america with the 
expansion of our brazilian sales office which is starting to generate 
revenues and gain market share and is being used as a base to 
target other south american markets 
in europe we are rolling out the same crm system that has been 
successfully established in the uk which will help to focus and 
enhance our customer facing service and cross selling 
opportunities across europe
oil services
our oil services division comprises the gall thomson and klaw 
businesses gall thomson environmental is the world’s leading 
supplier of marine breakaway couplings “mbcs” and through its 
klaw subsidiary is a supplier of industrial couplings including 
quick release and breakaway couplings 
gall thomson generated an increase in sales of 92 per cent 
across the year as a whole and improved margins due to increased 
sales of the higher margin mbc product as expected an increase 
in deferred orders and delayed shipments in the second half 
lowered the overall growth for the whole year from the exceptional 
growth generated in the first half
enquiry levels and order intake in both businesses was very strong 
towards the end of the year and has continued into 2011
saracen hs window lock
the saracen hs shootbolt 
system combines strength and 
durability with exceptional security 
and performance the combination 
of a robust central gearbox with twin 
mushrooms bidirectional bolts and 
roller cams offer the ultimate in 
window security
klaw marine breakaway 
couplings are designed 
specifically to be installed 
within a hose string where the 
coupling would have a length 
of hose attached to both sides 
typical applications include 
ship to offshore platform and 
ship to ship product transfer 
operations 11
lupus capital plc
annual report  accounts 2010
we had a vision that our eight autonomous uk units should be 
combined into one market leading group embracing our eight 
market leading brands each brand commands either first or 
second position in the uk market but operated entirely 
independent of each other under local managers the vision 
was to combine the 30 strong unit sales people into one 
cohesive sales team all selling all of the brands leveraging our 
individual brand strength to sell other group brands to our loyal 
customer base
in february 2010 we launched an all new business 
grouphomesafe comprising era esh homesafe ews 
linear schlegel securidor and balanceuk ventrolla our sash 
window renovation market leader remains an autonomous 
brand through its independent strength in both the retail and 
architectural sash window community
the sales people were transferred into grouphomesafe and 
trained on all the group brands salesforcecom the leading 
global crm cloud software and phocas a clever business 
information tool provide real time sales orders otif 
performance gross margin debtor and inventory information 
for the sales and support teams to better serve their customer
by june the benefits were already emerging with new business 
wins through cross selling ie selling more brands to existing 
customers
the software tools enable management and sales people  
alike to view customer sales orders and otif seamlessly  
as if the eight different and diverse local erp systems were 
one enabling us to serve and support the customer across the 
entire brand spectrum
essential to the launch of grouphomesafe was a brand 
management project revitalising and redesigning all the uk 
websites providing a shop window through which to promote 
our strong brands a homesafe retail door portal incorporating 
a configurator was introduced schlegel seals and era locks 
door and window hardware technical information and drawings 
are available to download to help designers and specifiers make 
informed choices new brand brochures and marketing material 
support the sales team in promoting the grouphomesafe vision
grouphomesafe treat the uk market as two distinct segments 
oem and distribution each headed by a sales director oem 
serves the window and door makers supplying every 
component the window and door maker needs even 
manufacturing and supplying the finished door itself making 
grouphomesafe the uk’s strongest biggest and most 
comprehensive supplier distribution serves diy retailers such 
as bq and wickes builder’s merchants such as travis 
perkins and howden and locksmiths through the securidor  
homesafe brands we serve the social housing replacement 
entrance door market both directly with housing associations 
and local authorities and through main contractors and 
maintenance providers
in 2010 grouphomesafe increased sales 10 by cross selling 
to the top 50 oem and distribution customers
case study
grouphomesafe 12
lupus capital plc
annual report  accounts 2010
principal risks and uncertainties ⁄
risk description ⁄
the overall growth and demand for the group’s products is 
subject to the usual drivers of construction activity ie general 
economic conditions interest rates businessconsumer 
confidence levels unemployment population growth etc this 
demand can be unpredictable and the group has a low visibility 
of future orders from its customers during any economic 
downturn customers and competitors may apply pressure to 
prices and this pressure can lead to lasting changes in terms of 
pricing policies delivery capabilities and market expectations 
mitigation ⁄
the geographic spread of our business and our ability to flex 
our cost base helps to mitigate some of this risk 
risk description ⁄
the group may face significant competition both actual and 
potential including competition from global competitors which 
have large capital resources in the provision of similar goods 
and services to those which are provided by the group 
competition in the industry is based upon range and quality of 
services offered geographical reach reputation and client 
relationships aggressive pricing from our competitors could 
cause a reduction in our revenues and margins
mitigation ⁄
some of our markets are relatively concentrated with two or 
three key players while others are highly fragmented and offer 
significant opportunities for consolidation and penetration 
furthermore the directors believe that in view of its range of 
products focus on setting industry leading standards for 
delivery on time and in full geographical spread strategic focus 
and reputation the group can compete effectively with its 
competitors we aim to minimise the impact of aggressive 
pricing by competitors through a low cost manufacturing 
strategy supported by our programmes of continuous process 
improvements and building longterm relationships with our 
customers based on value quality service and added value 
technical support
risk description ⁄
the success of the group will to some extent be dependent 
on the continuation of satisfactory commercial relationships with 
the major customers of the group
mitigation ⁄
the group aims to build longterm relationships with our 
customers based on value quality service and added value 
technical support the group has a well diversified customer 
base the top ten customers account for less than 25 of total 
group sales
market conditions
competitors
loss of major customers 13
lupus capital plc
annual report  accounts 2010
risk description ⁄
the group’s future success is substantially dependent on the 
continued services and performance of its executive directors 
and senior management and its ability to continue to attract and 
retain highly skilled and qualified personnel 
mitigation ⁄
to reinforce the company’s strategy to motivate and retain key 
individuals the remuneration committee with the help of 
outside consultants has recently revamped remuneration 
packages offered to executive directors and key senior 
management this now incorporates a significant element of 
performance related remuneration to align executive interests 
with those of shareholders a key element of this was the 
introduction of the lupus capital long term incentive plan in 
november 2010 
risk description ⁄
the group operates on a global basis and is therefore exposed 
to transactional and translational foreign exchange risk against 
sterling the group is also exposed to interest rate risks 
liquidity and credit risks  
mitigation ⁄
the group denominates some of its debt in foreign currency to 
match some of its exposure to the translational balance sheet 
risks associated with overseas subsidiaries ancillary bank 
facilities are available to manage some of the foreign exchange 
transactional risks and interest rate exposure through the use of 
derivative financial instruments the group maintains adequate 
cash balances and credit facilities based on forecasts of 
expected cash flow further information on these risks is given 
in note 18 to the group’s financial statements
risk description ⁄
the raw materials used in the group’s businesses include 
commodities that experience price volatility such as oil 
derivatives steel aluminium and zinc caused by changes in 
supply and demand and commodity market fluctuations the 
group’s ability to deliver according to market demands 
depends in large part on obtaining timely and adequate 
supplies of components and raw materials on competitive 
terms failure by any of the group’s suppliers could significantly 
limit the group’s sales and increase its costs 
mitigation ⁄
the group looks to minimise these risks through strong 
longterm relationships with suppliers economies of 
purchasing multiple suppliers and inventory management in 
addition the group will seek to increase the price of its products 
or apply surcharges to its customers to recover unavoidable 
input cost increases
key executives and personnel
financial risks
raw material costs and supply chain failures 14
lupus capital plc
annual report  accounts 2010
corporate social   ⁄
 responsibility report
the company being quoted on aim is not required to comply  
with the provisions of the combined code nevertheless the 
directors acknowledge the importance of corporate social 
responsibility reporting and have chosen to make the following 
voluntary disclosures
lupus considers that minimising its impact on the environment 
and ensuring that it has a positive interaction with its employees 
and the local communities it has a presence in to be important 
factors in its success
health and safety
the board is committed to providing a clean healthy and safe 
working environment and accepts collective responsibility for 
health and safety management the board considers this to  
make good business sense and regards it as a duty owed to  
its stakeholders the chief executive is the board member 
responsible for the group’s health and safety performance  
and through the divisional management the operational 
management of each individual operating unit is responsible for 
their own health and safety performance standards for health 
and safety vary widely across the countries where the group 
operates as a minimum the standards adopted are those 
required by law but the policy is to seek to exceed these where 
there is a demonstrable benefit
the profile of the importance of safe working practices has  
been increased throughout the group with details of accidents 
potentially serious hazards and remedial or preventative measures 
taken being shared between all sites a health and safety  
report is made by the chief executive officer to the board at  
each of its meetings
it is essential that all employees are made aware of the importance 
to the group of health and safety issues and ensure that the 
working environment is as safe as practical local management 
are tasked with creating a health and safety management  
system which
•	 i d e n t i f i e s	a n d	a s s e s s e s	r i s k s 
•	 t a k e s	a c t i o n s	t o	r e d u c e	r i s k s 
•	 d e v e l o p s	s a f e	wo r k i n g	p r a c t i c e s 	a n d
•	 e m p h a s i s e s	t r a i n i n g	a n d	d e v e l o p m e n t 
as part of this management system each location is internally 
audited corrective actions are identified and a plan is put in place 
to address deficiencies raised
the group requires that the causes of all accidents dangerous 
incidents and nearmiss situations are promptly and thoroughly 
investigated a range of investigatory procedures are used to 
achieve this with the intended purpose of avoiding or reducing the 
risk of repetition 
operations representing over 53 of the value of total group sales 
in 2010 have achieved accreditation for ohsas 18001 health and 
safety or for osha sharp the safety  health achievement 
recognition program run by the occupational safety  health 
administration of the united states department of labor “osha 
sharp” most of the other operations in the group have 
programmes in place with the objective of achieving accreditation
ethics
the group aims to act responsibly and with integrity respecting 
the laws and regulations of all the countries within which it 
operates as well as internationally accepted standards of 
responsible business conduct the group requires high standards 
of professional and ethical conduct from all employees and 
directors every business within the group is expected to operate 
with policies and procedures which are consistent with the group’s 
values and standards in all dealings all employees and other 
persons acting on behalf of the group are expected to
•	 e n g a g e	i n	h o n e s t	a n d	e t h i c a l	c o n d u c t 	i n c l u d i n g	t h e	a v o i d a n c e	
a n d	r e p o r t i n g	o f	a n y	c o n f l i c t s	o f	i n t e r e s t 
•	 m a i n t a i n	 e f f e c t i v e	 p r o c e d u r e s	 t o	 p r e v e n t	 c o n f i d e n t i a l	 i n f o r m a t i o n	
b e i n g	m i s u s e d	o r	u s e d	f o r	p e r s o n a l	g a i n 
•	 a d v a n c e	t h e	l e g i t i m a t e	i n t e r e s t s	o f	t h e	g r o u p 	h a v i n g	r e g a r d	t o	
t h e	g r o u p ’ s	v a l u e s	a n d	s t a n d a r d s 
•	 c o m p l y	w i t h	a l l	a p p l i c a b l e	l aw s	a n d	r e g u l a t i o n s	i n	e v e r y	c o u n t r y	
i n	w h i c h	t h e	g r o u p	o p e r a t e s 
•	 m a i n t a i n	a	h e a l t h y	a n d	s a f e	wo r k i n g	e n v i r o n m e n t	f o r	e m p l o y e e s	
t o	wo r k	i n 
•	 t r e a t	c u s t o m e r s	f a i r l y 	o p e n l y	a n d	h o n e s t l y 
•	 b e	i n t o l e r a n t	o f	d i s c r i m i n a t i o n	o r	h a r a s s m e n t	o f	a n y	k i n d 
•	 m a i n t a i n	h i g h	s t a n d a r d s	o f	i n t e g r i t y	i n	 b u s i n e s s	r e l a t i o n s h i p s	
w i t h	s u p p l i e r s 	a n d
•	 e n c o u r a g e	t h e	u s e	o f	t h o s e	s u p p l i e r s	w h o	o p e r a t e	w i t h	v a l u e s	
and standards equivalent to those of the group
employees
training and development
employees are provided with training in order to give them the 
necessary skills to perform their duties and where appropriate to 
develop those skills and progress their career the group invests in 
a range of development activities including nvqs and 
apprenticeship schemes and supports other professional and 
technical training
customers and suppliers
the group seeks to be honest and fair in its relationships with 
customers and suppliers to provide customers with standards of 
product and service that have been agreed and to pay suppliers 
and subcontractors on agreed terms it is group policy to 
maintain accreditation to the quality management standard iso 
9001 and encourage operating units to gain accreditation to any 
specific standards required by the markets served currently 
operating units with 91 per cent of the group’s turnover have iso 
9001 accreditation
community
the board encourages and supports initiatives by operating units 
to engage with their local community operating units and their 
staff participate in a variety of local activities including projects with 
local schools and charity events the group policy on donations is 
to support local educational and charitable causes and in 
particular those where employees and their families are involved in 
the fund raising 15
lupus capital plc
annual report  accounts 2010
amesbury continues to be a leader in its communities as well 
as its industry with regard to the focus and responsibility of 
reducing its carbon footprint 
accomplishments achieved over the past year include the 
following 
recycled  reused in production
•	 1 6 5  1 8 8	l b s	o f	r e c y c l e d	c o r r u g a t e d
•	 2 0  6 8 9	l b s	o f	r e c y c l e d	p a p e r
•	 8 9 8  5 7 4	l b s	o f	r e p e l l e t i z e d	p l a s t i c s	
recycled not in landfills
•	 5 1 5  2 4 2	l b s	o f	d i e	d r o o l
•	 2 0  2 0 0	l b s	o f	p o l y p r o p y l e n e
•	 5 7  3 0 0	l b s	o f	p o l y e t h y l e n e
•	 6 2  0 0 0	l b s	o f	s t e e l
•	 1 5  0 0 0	l b s	o f	s t a i n l e s s	s t e e l
•	 3  4 0 0	l b s	o f	b r a s s
in 2010 an initiative was established to reduce significantly 
electrical consumption at each facility it was determined that 
by replacing existing lighting with energy efficient lighting 
there would be an annual reduction of 1519644 kilowatts 
this project will reduce carbon dioxide by 10101 tons 
sulphur dioxide by 40 tons and nitrogen oxide by 15 tons 
per year by removing these pollutants from the air we had 
the same effect on the environment as planting 279 acres of 
trees removing 245 cars from the road each year saving 
2987 barrels of oil per year or saving 125448 gallons of 
gasoline per year
case study green initiatives at 
the amesbury group
the environment
the board recognises its responsibilities as a manufacturing 
concern to continue to reduce the environmental impact of its 
factories in addition the group aims to develop and supply 
products to help customers meet their own environmental 
objectives and the demands of their customers and of government
the most significant areas of environmental impact associated with 
the group’s operations are energy consumption waste to landfill 
the use of outer packaging and transport
•	 p r o c e s s	d e v e l o p m e n t 	t h e	g r o u p	s e e k s	t h r o u g h	i n t e r n a l	
developments and investment to reduce the resource 
consumption of manufacturing sites the reuse of waste is 
encouraged across the group
•	 e n e r g y	c o n s u m p t i o n 	t h e	g r o u p	c o n t i n u e s	t o	i n v e s t	i n	e n e r g y	
efficiency measures such as lighting and improved heating and 
cooling systems
•	 w a s t e	t o	l a n d f i l l 	t h e	g r o u p	a c t s	t o	m i n i m i s e	t h e	a m o u n t	o f	
waste sent to landfill by selling for recycling any waste that 
cannot be used internally
•	 o u t e r	p a c k a g i n g	a n d	t r a n s p o r t 	t h e	g r o u p	m i n i m i s e s	t h e	u s e	o f	
outer packaging where appropriate and encourages the use of 
returnable outer packaging formats the group reduces the 
environmental impact of transport through vehicle efficiency 
measures such as improved load fill reductions in empty 
running and route optimisation
in developing new products the group aims to minimise the 
environmental impact and maximise energy efficiency and the 
potential for recycling while continuing to meet the performance 
and customer requirements the increasing dangers from climate 
change and rising fuel costs are making the specification of 
thermally efficient products imperative the group monitors 
developments in alternative materials and production processes 
which may reduce the environmental impact of its products 
the group is committed to the introduction of environmental 
management systems such as iso 14001 currently five of the 
group’s manufacturing sites have achieved accreditation to the 
environmental management systems standard iso 14001 16
lupus capital plc
annual report  accounts 2010
board of directors ⁄
les tench 
nonexecutive director
les tench aged 65 has considerable experience in building 
products having joined crh plc in 1992 where from 1998 until his 
retirement in december 2002 he was managing director of crh 
europe – building products he was also a nonexecutive director 
of the privately owned family business shepherd building group 
limited construction and engineering manufacturing and property 
development from 1994 until 2004 and was nonexecutive 
chairman of sig plc from 2004 until january 2011
 
mr tench is currently a nonexecutive director of norcros plc
martin towers
nonexecutive director
martin towers aged 58 was chief executive of spice plc until its 
sale to cinven in december 2010 previously he was group finance 
director of kelda group plc from 2003 until february 2008 
mr towers is a fellow of the institute of chartered accountants in 
england and wales and began his career with coopers  lybrand 
now pricewaterhousecoopers before moving to the retailer ward 
white group plc he has served as group finance director of 
mccarthy  stone plc the spring ram corporation plc and allied 
textile companies plc he was a nonexecutive director of 
homestyle group plc from 2004 to 2006
mr towers is currently a nonexecutive director of kcom group 
plc and rpc group plc
jamie pike 
nonexecutive chairman
jamie pike aged 55 was chief executive of foseco plc an 
international business serving the foundry and steel making 
industries until its acquisition by cookson group plc in april 2008 
he led the buyout of foseco from burmah castrol in 2001 which 
culminated in flotation on the main market in 2005 mr pike was 
educated at oxford holds an mba from insead and is a member 
of the institute of mechanical engineers
his early career was as a consultant with bain and co and a t 
kearney before joining burmah castrol in 1991 he rose to chief 
executive of burmah castrol chemicals before leading the foseco 
buyout he has previously been a nonexecutive director of two 
ftse 250 companies rmc group plc and kelda group plc mr 
pike is also chairman of rpc group plc mba polymers inc and 
the defence support group
louis eperjesi 
chief executive officer
louis eperjesi aged 49 was appointed to the board in february 
2010 mr eperjesi has an extensive and successful track record in 
the building materials and manufacturing sectors most recently at 
kingspan group plc the international building products business 
where he was an executive director on the main board and 
divisional managing director of kingspan insulated panels the 
group’s largest division 
prior to joining kingspan mr eperjesi held a range of senior 
management positions at subsidiaries of baxi group plc redland 
plc lafarge and caradon plc
james brotherton 
chief financial officer
james brotherton aged 41 joined lupus as head of corporate 
development in 2004 he was previously a director in the 
investment banking division of citigroup having also worked for 
hsbc and ernst and young he is a chartered accountant 
mr brotherton was appointed as chief financial officer of lupus in 
may 2010
lr james brotherton les tench louis eperjesi jamie pike and martin towers  corporate governance   ⁄
financial statements
17
lupus capital plc
annual report  accounts 2010
in this section
18 directors’ report 
20 corporate governance
23 directors remuneration report
29 independent auditors’ report
30  consolidated income statement
31  consolidated statement of comprehensive income
31  consolidated statement of changes in equity
32 consolidated balance sheet
33 group cash flow statement
34 notes to the financial statements
60 independent auditor’s report
61 company balance sheet
62 notes to the company financial statements
65  advisers
65 definitions
65 roundings
65 exchange rates
66 notice of annual general meeting
71 form of proxy 18
lupus capital plc
annual report  accounts 2010
directors report ⁄
review of the business
the review of the business is set out on pages 8 to 11 
principal activities 
the company is a holding company the principal activities of the group are unchanged from last year and is a leading 
international supplier of building products to the door and window industry and the world’s number one manufacturer of marine 
breakaway couplings  
future developments 
the statement by the chairman and chief executive officer set out on pages 4 to 7 contains details of the progress of the group 
during the year together with an indication of future developments 
results and dividends 
the group profit for the year after taxation amounted to £7047000 2009 £413000 
no dividends were paid in the financial year 2009 nil the board is recommending a final dividend of 20 pence per ordinary 
share 2009 nil to be paid on 7 june 2011 subject to approval at the forthcoming annual general meeting of the company to 
shareholders on the register on 3 may 2011 the exdividend date will be 27 april 2011
the board 
the directors who have held office during the last financial year and in the subsequent period to the date of this report are listed 
on page 16 mr taylor mr jackson and mr tate who were directors of the company stepped down from the board on 22 
january 2010 in addition mr mulhall and mr feltonsmith were also directors of the company until they retired from the board on 
31 march 2010 and on 7 may 2010 respectively mr eperjesi joined the board on 22 february 2010 and mr brotherton joined the 
board on 28 may 2010 
except for their shareholdings the nonexecutive directors are entirely independent there were no contracts subsisting during or 
at the end of the year in which a director was or is materially interested the company maintains a policy of insurance against 
directors’ and officers’ liabilities
 
a description of the board’s method of operation its work during the year and that of its committees is given in the report on 
corporate governance on pages 20 to 22 
reelection of directors 
mr brotherton having been appointed by the board since the last annual general meeting will seek reelection at the annual 
general meeting in accordance with best practice the board have agreed that each director will voluntarily offer themselves for 
reelection at each annual general meeting that they are not required to retire from office accordingly mr pike mr eperjesi 
mr tench and mr towers will voluntarily offer themselves for reelection at the 2011 annual general meeting
new long term incentive plan
the lupus long term incentive plan was described in the circular dated 10 november 2010 and approved by shareholders at the 
general meeting on 30 november 2010 it is a new scheme unrelated to the 2004 arrangements and the board have resolved 
that no further awards will be made under either the 2004 or 2008 incentive plans the details of awards to directors under this 
plan are given in the directors’ remuneration report on page 23 
purchase of the company’s own shares
no resolution concerning the purchase of the company’s own shares was put forward at the agm on 28 may 2010 and no shares 
were purchased by the company during the year ended 31 december 2010 
it is expected that the requirements of the lupus long term incentive plan outlined above may be met by the purchase of shares 
in the market although these requirements are not imminent the directors believe that the company should now obtain a fresh 
authority for this purpose they therefore propose resolution 13 to obtain authority to make market purchases up to the date of the 
agm in 2012 the authority will be limited to 1499 of voting shares in issue that is excluding shares held in treasury 
resolution 13 is proposed as a special resolution in accordance with best practice
auditors 
in accordance with section 489 of the companies act 2006 an ordinary resolution to reappoint grant thornton uk llp as 
auditors will be proposed at the annual general meeting this is item 8 in the notice of meeting 
directors’ remuneration
the company being quoted on aim is not required to comply with the directors’ remuneration report regulations 2002 or the 
disclosure provisions of schedule 7a of the companies act 1985 and the ukla listing rules nevertheless the company has 
chosen to present a report on directors’ remuneration on pages 23 to 28 the directors have also determined on a voluntary 
basis that this report should be submitted to shareholders for their approval this is resolution 10 in the notice of meeting 19
lupus capital plc
annual report  accounts 2010
allotment of shares
shareholders passed resolutions to authorise the directors to allot shares and within certain limitations to do so free from 
preemption rights at the annual general meeting held on 28 may 2010 
the directors’ authority to allot shares does not expire until 1 may 2015 whereas the disapplication of preemption rights is only 
effective until the conclusion of the company’s 2011 agm the directors believe that the company’s proceedings will be more 
transparent if they seek renewed authority to allot at the same time as they seek authority to disapply preemption rights
therefore the notice of meeting includes resolution 11 which will authorise the directors to allot shares subject to specified limits 
until 1 may 2016 and resolution 12 a special resolution which will authorise the directors to disapply preemption rights in certain 
circumstances and subject to specified limits until the conclusion of the company’s 2012 agm 
substantial shareholders 
in addition to the holdings of the directors described in the directors remuneration report at the latest practicable date before 
publication of this report the company had been notified of or had identified the following direct or indirect interests comprising 
3 or more of its voting share capital the issued share capital less shares held by the company in treasury
ordinary shares 
aviva 18151556 1398
f  c asset management 16158580 1244
standard life 14384891 1108
mr g hutchings 14300417 1101
polar capital 8886077 684
svg investment managers 7137808 550
schroder asset management 6405188 493
epic 4261791 328
creditors payment policy 
group operating companies are responsible for agreeing the terms and conditions under which business transactions with their 
suppliers are conducted it is group policy that payments to suppliers are made in accordance with all relevant terms and 
conditions creditor days for the group have been calculated at 64 days 
financial risk management
a statement on the financial risk management objectives policies and other matters in relation to the use of financial instruments is 
set out in note 18 in the notes to the group financial statements
safety health and the environment 
the board recognises that the highest standards in safety health and environmental issues are an essential part of sound 
business practice the board is committed to improving the impact on the environment from any of its operations and to 
incorporating the principles of sustainable development a full description of the group’s policies with respect to health and safety 
and the environment are given in the corporate social responsibility report on page 14
employees
the group’s excellent performance would not be possible without employees of the highest calibre with the motivation to perform 
to their full potential the group operates on a decentralised structure reflecting the organisation of the group this underscores 
our belief that localised teams operating under common principles are best equipped to deal with the varying cultures operating 
structures and geographic locations that exist in the group 
each operating entity in the group is encouraged to implement comprehensive employment policies designed to motivate 
employees and to determine ways in which their knowledge and skills can best contribute towards the success of the business
employee involvement and communication programmes continue to be developed that are designed to provide equal opportunity 
to all irrespective of sex race religion or colour each company in the group endeavours to provide equality of opportunity in 
recruiting training promoting and developing the careers of disabled people
going concern 
the board believes it is appropriate to continue to adopt the going concern basis in preparing the annual report and accounts as 
stated in the basis of preparation note on page 34
by order of the board 
cavendish administration limited 
company secretary 
23 march 2011
company registration number 3846926 20
lupus capital plc
annual report  accounts 2010
corporate governance ⁄
the company being quoted on aim is not required to comply with the provisions of the combined code nevertheless the 
directors acknowledge the importance of the principles set out in the combined code issued by the financial reporting council 
and have put in place a framework for corporate governance which they believe is appropriate for the company they have 
chosen to make the following voluntary disclosures
the board 
board composition 
the board comprises two executive and three nonexecutive directors 
during the year ended 31 december 2010 there were a number of changes to its personnel
mr taylor mr jackson and mr tate stepped down from the board on 22 january 2010 •	
mr eperjesi was appointed chief executive officer on 22 february 2010 and joined the board at the same time •	
mr mulhall stepped down from the board on 31 march 2010 •	
mr feltonsmith stepped down from the board on 7 may 2010 •	
mr brotherton was appointed chief financial officer on 10 may and joined the board on 28 may 2010 •	
both mr eperjesi and mr brotherton are engaged exclusively on the company’s business and have no outside interests that 
conflict with their responsibilities to the company except for their shareholdings all nonexecutive directors are independent 
how the board operates 
the board meets regularly and is responsible for the overall leadership strategy development and control of the group in order to 
achieve its objectives for continued earnings growth and to enhance shareholder value the board sets the group’s strategic 
aims ensures that the necessary financial and human resources are in place for the group to meet its objectives reviews 
management performance and ensures that high ethical standards of behaviour are followed the board also ensures that there is 
an effective system of controls to safeguard the company’s assets and to enable risks to be properly assessed and managed
the board has a formal schedule of matters specifically reserved for it and this includes key matters such as approval of the 
group’s objectives strategic plans annual budgets financial reporting risk assessment and internal controls monitoring 
operating and financial performance capital and legal structure material capital investments material contracts and transactions 
communication with shareholders board membership and appointments directors’ remuneration and contracts corporate 
governance group policies and delegation of responsibilities matters not specifically reserved for the board are delegated 
to management 
to enable the board to discharge its duties all directors receive appropriate and timely information cavendish administration 
limited the corporate company secretary distributes briefing papers to all directors in advance of board meetings all directors 
have access to the advice and services of the company secretary which is responsible for ensuring that board procedures are 
followed and that applicable rules and regulations are complied with the appointment and removal of the company secretary is a 
matter for the board as a whole in addition procedures are in place to enable the directors to obtain independent professional 
advice in the furtherance of their duties if necessary at the company’s expense 
board meetings 
during the year ended 31 december 2010 the number of board and committee meetings held and attended by their members 
was as follows 
board remuneration committee audit committee nominations committee
director
number of 
meetings
number 
attended
number of 
meetings
number 
attended
number of 
meetings
number 
attended
number of 
meetings
number 
attended
jamie pike 10 10 2 2 3 3 1 1
louis eperjesi 8 8 0 0 0 0 0 0
james brotherton 5 5 0 0 0 0 0 0
martin towers 10 9 2 2 3 3 1 1
leslie tench 10 8 2 2 3 2 1 1
paul feltonsmith 3 3 0 0 0 0 0 0
denis mulhall 3 3 0 0 0 0 0 0
michael jackson 1 0 0 0 0 0 0 0
roland tate 1 1 0 0 0 0 0 0
keith taylor 1 1 0 0 0 0 0 0
reelection of directors 
all directors are subject to reelection by the shareholders at annual general meetings at a maximum interval of three years the 
articles of association provide that directors appointed by the board will be subject to reelection at the first agm thereafter in 
accordance with best practice the board have agreed that each director will voluntarily offer themselves for reelection at each 
annual general meeting that they are not required to retire from office 21
lupus capital plc
annual report  accounts 2010
remuneration 
a report on directors’ remuneration is included on pages 23 to 28 
board committees 
the board has formed an audit and corporate governance committee a remuneration committee and a nominations 
committee each comprised of all independent nonexecutive directors the existence of the committees ensures that time is 
allocated on a formal basis to consider relevant issues 
audit and corporate governance committee 
the audit and corporate governance committee is made up of the nonexecutive directors and meets at least three times a year the 
executive directors also attend certain meetings of the committee the committee considers the appointment and fees of the external 
auditors and discusses the scope of the audit and its findings the committee is also responsible for monitoring compliance with 
accounting and legal requirements and for reviewing the annual and interim financial statements this committee was chaired by mr 
towers during 2010
the audit committee also reviews any nonaudit services provided by the auditors such services have been and are limited to 
the provision of transaction support services and some tax compliance work and tax advice the committee is satisfied that the 
provision of such services does not in any way prejudice the objectivity and independence of the auditor professional firms other 
than the auditors also provide tax compliance work and tax advice
audit independence 
under the ethical standards issued by the auditing practices board an audit engagement partner responsible for the audit of a 
listed company normally serves in that role for a period of no more than five years however there is scope for audit committees to 
decide that a degree of flexibility over the timing of rotation is necessary to safeguard the quality of the audit in 2009 the audit 
committee determined that due to substantial changes occurring at board level it would be in the interests of audit quality that 
the current audit engagement partner should continue in his role until the completion of the audit of the 2010 accounts the audit 
committee is satisfied that by the application of safeguards the extension does not undermine the objectivity and independence 
of the auditor
grant thornton uk llp has agreed to these extensions which will bring the total period served by the audit engagement partner 
to seven years as permitted by the ethical standards
remuneration committee 
the remuneration committee considers and approves the remuneration and benefits of the directors the committee also 
determines the remuneration of the members of the executive management committee of the company and the company 
secretary and of the service providers contracted to perform executive functions for the group as well as longterm share 
incentive and share option schemes for all employees
the membership and work of the committee during the year ended 31 december 2010 is described in detail in the directors’ 
remuneration report on pages 23 to 28 
nominations committee 
the nominations committee identifies and nominates candidates for the office of director of the company it meets as and when 
required and is chaired by mr pike except that mr pike would not chair the committee or attend it if it were to consider the 
appointment of a successor chairman 
internal control 
the directors acknowledge that they are responsible for the group’s system of internal controls and for reviewing the effectiveness 
of those controls the board including the executive directors reviews the internal control framework on an ongoing basis
 
procedures have been developed to safeguard assets against unauthorised use or disposition of assets and to maintain proper 
accounting records to provide reliable financial information both for internal use and for publication in accordance with the 
guidance of the turnbull committee on internal control the procedures are regularly reviewed in the light of an ongoing process to 
identify evaluate and manage the significant risks faced by the company the process has been in place for the full year under 
review and up to the date of the approval of the annual report and financial statements the procedures are designed to manage 
rather than eliminate risk and can only provide reasonable and not absolute assurance against material misstatement or loss 
relations with shareholders 
communications with shareholders are given high priority and there is a regular dialogue with institutional shareholders
 
the board uses the annual general meeting to communicate with private and institutional investors and welcomes their 
participation details of resolutions to be proposed at the annual general meeting can be found in the directors’ report
  22
lupus capital plc
annual report  accounts 2010
the company has set up a website wwwlupuscapitalcouk which shareholders investors and other interested parties may access 
the website permits users to download copies of published financial reports press releases and stock exchange announcements 
directors’ responsibilities statement  
the directors are responsible for preparing the directors’ report and the financial statements in accordance with applicable law 
and regulations 
company law requires the directors to prepare financial statements for each financial year under that law the directors have 
prepared the group financial statements in accordance with international financial reporting standards as adopted by the 
european union ifrss and have elected to prepare the parent company financial statements in accordance with united kingdom 
generally accepted accounting practice united kingdom accounting standards and applicable laws under company law the 
directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs 
and profit or loss of the company and group for that period in preparing these financial statements the directors are required to 
select suitable accounting policies and then apply them consistently •	
make judgments and accounting 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 and
prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will •	
continue in business 
the directors are responsible for keeping adequate 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 
in so far as each of the directors is aware 
there is no relevant audit information of which the company’s auditor is unaware and •	
the directors have taken all steps that they ought to have taken to make themselves aware of any relevant audit information and •	
to establish that the auditor is aware of that information
the directors are responsible for the maintenance and integrity of the corporate and financial information included on the 
company’s website legislation in the united kingdom governing the preparation and dissemination of financial statements may 
differ from legislation in other jurisdictions 
corporate governance  ⁄ continued 23
lupus capital plc
annual report  accounts 2010
the remuneration report is presented to shareholders by the board and sets out the remuneration policy and details of the 
remuneration of each director the report has been prepared in accordance with the provisions of the companies act 2006 
the “act” and the aim rules for companies as issued by the london stock exchange 
a resolution to approve this report will be proposed at the company’s annual general meeting on 27 may 2011
remuneration committee
the remuneration committee of the board comprises all nonexecutive directors of the company the executive directors may 
by invitation attend meetings and provide advice to the committee except when their own remuneration is discussed during 
2010 the committee was chaired by mr tench and met twice 
the remuneration committee is responsible for 
setting reviewing and recommending to the board for approval the company’s overall remuneration policy and strategy •	
determining and reviewing the terms of appointment and the remuneration arrangements of the executive directors of •	
the company 
determining and reviewing the terms of appointment and the remuneration arrangements of the members of the executive •	
management committee of the company and
approving the rules and launch of any company share share option or cashbased incentive plan and the grant award •	
allocation or issue of shares share options or payments under any such plan
during the year kepler associates were engaged by the committee to provide it with independent remuneration advice kepler 
associates did not provide any other services to the company other than remuneration advice
following a number of changes to the board of directors of the company the remuneration committee undertook a review of 
senior executive remuneration arrangements in conjunction with its independent adviser kepler associates to ensure 
remuneration arrangements align executive interests with those of shareholders reinforce the company’s strategy and motivate 
and retain key individuals as a result of the review and following consultation with the company’s principal shareholders and 
shareholder representative bodies the directors proposed the introduction of a new long term incentive plan at a general 
meeting of the company on 30th november 2010 shareholders passed resolutions to authorise the directors to establish the 
lupus capital long term incentive plan the “ltip” 
remuneration policy 
nonexecutive directors
the board as a whole determines the remuneration of nonexecutive directors based on the recommendations of the executive 
directors and comparison with other companies of a similar size and sector nonexecutive directors do not participate in any 
bonus or sharebased incentive schemes 
executive directors
the remuneration committee considers the need to attract retain and motivate executive directors and senior management in 
determining appropriate remuneration policies and packages it also takes into account the internal pay and benefits practice and 
employment conditions both within the group as a whole and within the particular national context external comparisons examine 
equivalent roles in similar companies taking into account their size business complexity international scope and relative 
performance consideration is also given to the risks arising from market comparisons and inappropriate performance criteria
the remuneration committee has reviewed the remuneration policy during the year and has continued to give particular consideration 
to the issue of performance related remuneration and the provisions contained within section d of the uk corporate governance 
code that the performance related element should form a significant proportion of the remuneration package of executive directors 
the adoption of the ltip in november 2010 enabled progress to be made towards increasing performance related remuneration as a 
proportion of executive directors’ total remuneration and compliance with the uk corporate governance code 
remuneration 
the current remuneration package for the executive directors comprises fixed and variable components the variable 
components are the performance related incentive arrangements referred to in detail below 
directors remuneration report  ⁄ 24
lupus capital plc
annual report  accounts 2010
target stretch
 fixed 60
 performance 
related 40
 fixed 37
 performance 
related 63
executive directors remuneration 2010
target assumes that bonus of 50 of base salary is earned and that 25 of the lupus shares awarded under the ltip in respect of 2010 based on a market value of £111276 at 
31 december 2010 vest stretch assumes that bonus of 100 of base salary is earned and that 100 of the lupus shares awarded under the ltip in respect of 2010 based on 
a market value of £111276 vest
the key components of the remuneration of executive directors are set out below
salary
salaries are reviewed annually by the remuneration committee although not necessarily increased this review takes into 
account an individual’s responsibilities abilities experience performance market competitiveness and pay and conditions in the 
relevant countries across the group as described above
during the year the remuneration committee reviewed executive director salaries and determined that with effect from 1 january 
2011 louis eperjesi and james brotherton’s annual salaries comprising base salary plus an allowance in lieu of pension and 
benefits would be increased by 25 to £307500 and £205000 respectively 
performance related remuneration
annual bonus
the remuneration committee has introduced the following annual bonus framework for executive directors for 2010
target and maximum annual bonus opportunities of 50 per cent and 100 per cent respectively of base salary 70 per cent •	
based on the underlying group profit before tax and 30 per cent based on free cashflow and
50 per cent of bonus amounts will be converted into ordinary shares in the capital of the company under the terms of the •	
recently introduced deferred share bonus plan and released after three years
based on the performance for 2010 against the underlying group profit before tax and the free cash flow targets set the 
committee determined that the chief executive officer and the chief financial officer have each achieved a bonus level of 100 
of their respective base salaries 50 of which will be paid in cash in march 2011 and 50 will be awarded in the form of nilcost 
options deferred for three years under the terms of the deferred share bonus plan
under the deferred share bonus plan 50 of executive director bonuses that would otherwise have been payable will be 
delivered in the form of either conditional share awards or nilcost options to strengthen alignment with shareholders’ interests 
these awards will normally be released together with dividend equivalents in cash or shares after three years in future years 
other key employees may be required to defer a proportion of their bonuses pursuant to the deferred share bonus plan
the lupus capital long term incentive plan “ltip”
the ltip provides for the grant of i performance shares or nilcost options andor ii fairmarket value options vesting on the 
satisfaction of stretching performance criteria over three years subject to individual and overall limits the remuneration 
committee currently intends that longterm incentive awards will be in the form of nilcost options however the remuneration 
committee retains the flexibility to consider other forms of award such as fairmarket value options for future cycles as it is 
mindful that alternative forms of award remain prevalent in some of the geographies eg the us in which the company competes 
for senior executive management
in recognition of the fact that there have been no longterm incentive arrangements in place during 2010 and to enable a smooth 
transition to annual rolling 3year ltip cycles in december 2010 the remuneration committee granted nil or nominal cost options 
over 1413000 ordinary shares in the company to around 50 senior managers executives and executive directors in addition the 
remuneration committee will make awards under the ltip during the summer of 2011 the “2011 award” for subsequent years 
awards made under the ltip will generally be made in the period following the announcement of the company’s fullyear results 
directors remuneration report  ⁄ continued  25
lupus capital plc
annual report  accounts 2010
performance criteria
the vesting of ltip awards are subject to stretching performance criteria set by the remuneration committee at the start of each 
performance period 2010 awards and 2011 awards will vest together with dividends foregone based on 3year cumulative 
underlying earnings per share “eps” for the financial years 2011 to 2013
the remuneration committee adopts a robust process to setting what it feels are stretching but achievable annual and long
term incentive performance targets performance targets are calibrated to be equivalent to at least ‘upper quartile’ performance 
for awards to vest in full and take account of a number of reference points which reflect internal and external expectations 
including the latest internal forecasts broker forecasts for sector comparators eps performance zones used in comparator 
longterm incentives straightline profit growth consistent with median and upper quartile returns over the next three to five years 
and broker forecast data for the company
underlying eps is the performance measure that determines vesting of 2010 and 2011 ltip awards as underlying eps is well
aligned with shareholder interests provides good lineofsight and is well understood the remuneration committee is committed 
to reviewing the possibility of introducing additional performance measures such as total shareholder return “tsr” or cashflow 
as well as the continuing appropriateness of underlying eps in advance of each ltip cycle 
additionally for awards to vest on underlying eps the remuneration committee must satisfy itself that the recorded underlying 
eps is a genuine reflection of the underlying business performance of the company over the performance period
performance criteria 2010 awards
the performance criteria for vesting of 2010 awards is a 3year cumulative underlying eps 201113 performance range of 38p to 
47p in summary if over the 3 financial years 2011 to 2013 cumulative underlying eps is less than or equal to 38p no 2010 
awards will vest 25 per cent of 2010 awards will vest for cumulative underlying eps of 38p rising on a straightline basis to full 
vesting for cumulative underlying eps of 47p or higher
performance criteria 2011 awards
proposed 2011 awards will also vest on cumulative 3year underlying eps for financial years 2011 to 2013 the remuneration 
committee will review and revert to its principal shareholders with the eps targets for 2011 awards in advance of the anticipated 
grant during the summer of 2011
dilution limit
generally it is the intention that ltip awards will be satisfied through the transfer of existing shares by the company’s employees’ 
benefit trust unless the remuneration committee in its discretion feels that a new issue of shares would be more appropriate in 
the event that ltip awards are satisfied through new issue shares the company will operate within the association of british 
insurers’ “abi” guideline dilution limit of 10 per cent in 10 years for all sharebased incentive schemes excluding awards to the 
former executive chairman granted in 2004 and 2008 expected dilution should not exceed the 10 per cent dilution limit even if 
the awards made to the former executive chairman are taken into account
the remuneration committee has the flexibility to operate outside the abi guideline of 5 per cent in 10 years dilution limit for 
discretionary sharebased incentive schemes to accommodate ltip awards for a broader employee population in managing 
dilution the company will nevertheless be mindful of the 5 per cent in 10 years guideline and will be prudent in managing the flow 
rates keeping shareholders informed of actual and anticipated dilution levels over time the 2010 ltip awards are likely to be 
satisfied through the transfer of existing shares rather than the issue of new shares
assuming that all performance targets are met in full the remuneration committee currently envisages that a maximum of 
515000 of the 1413000 shares subject to the 2010 award approximately 3644 will be satisfied through new issue shares to 
ensure that local trusts tax and securities laws are complied with in certain overseas jurisdiction
shareholding guidelines
the remuneration committee has also adopted shareholding guidelines for executive directors executive directors will be 
expected to retain at least half of the shares vesting net of taxes under the deferred share bonus plan or the ltip until such time 
as a total personal shareholding equivalent to 100 per cent of base salary has been achieved the table below sets out the 
individual requirement and level of shareholding achieved for each executive director at 31 december 2010
directors minimum shareholding
salary
i
£’000
value of
shareholding
ii
£’000
minimum 
shareholding 
as  of salary
actual 
shareholding 
as  of salary
louis eperjesi 250 161 100 64
james brotherton 190 166 100 87
notes to directors’ minimum shareholding table above
i  as at 31 december 2010
ii  based on the closing price of a lupus capital plc ordinary share of £111275 on 31 december 2010 26
lupus capital plc
annual report  accounts 2010
awards to executive directors
the number of shares awarded to the executive directors under the ltip for the 2010 awards and proposed for the 2011 awards 
are as follows
2010 
awards
proposed  
2011 
awards
louis eperjesi 200000 200000
james brotherton 150000 150000
the 2010 awards and the proposed 2011 awards are granted over a fixed number of shares to mitigate the impact of share price 
volatility and strengthen alignment of executive interests with those of shareholders over the period to grant the committee 
intends to adopt the more usual methodology of granting ltip awards by reference to a percentage of base salary from 2012 
onwards and accordingly from 2012 ltip awards of performance shares or nilcost options will be restricted to a maximum of 
100 per cent of base salary 
senior executives below the executive directors
the policy and practice with regard to the remuneration of senior executives below the executive directors who are members of 
the executive management committee is entirely consistent with that for the executive directors these senior executives all have 
a significant portion of their reward package linked to performance they all qualify for an annual bonus and are eligible for 
awards under the ltip and their financial targets are the same as or cascaded from the targets for the executive directors the 
remuneration committee reviews and approves the individual remuneration packages for the executive management committee 
members and the company secretary in accordance with the overriding objectives of the group’s remuneration policy their 
individual performance is reviewed and their increases in base salary annual bonus payments and any ltip awards are subject to 
approval by the remuneration committee each year other senior employees below executive management committee level are 
generally treated consistently with the executive directors and members of the executive management committee with the 
exception that they may participate in local discretionary annual cash bonus plans
summary of directors’ service contracts
the following table shows details of the service contracts for executive directors who were in office at 31 december 2010
name
commencement 
date
notice 
period
louis eperjesi 20072010 12 months
james brotherton 20072010 12 months
for both executive directors their service contracts are terminable on 12 months’ notice to or from the company and contractual 
termination provisions are limited to salary and benefits over the notice period payments are phased monthly and subject to 
mitigation in line with best practice
the nonexecutive directors have letters of appointment which provide a notice period of one month 
name
commencement 
date
notice 
period
jamie pike 23112009 1 month
les tench 17122009 1 month
martin towers 17122009 1 month
directors remuneration report  ⁄ continued  27
lupus capital plc
annual report  accounts 2010
directors emoluments
the remuneration payable to directors which has been audited by the company’s auditors in respect of the year ended 
31 december 2010 was as follows 
directors’ remuneration for the year 
ended 31 december
salaryfees 
£’000
cash 
bonus 
£’000
cash 
payments 
in lieu 
of pension 
and benefits 
£’000
non cash 
benefits 
£000
severance 
payments 
£’000
total 
emoluments 
2010 
£’000 notes
total 
emoluments 
2009 
£’000
current directors
jamie pike 90 – – – – 90 9
louis eperjesi 231 115 46 2 – 394 i na
james brotherton 113 56 6 1 – 176 iiiii na
les tench 30 – – – – 30 1
martin towers 30 – – – – 30 1
past directors
keith taylor 73 – – – – 73 572
denis mulhall 103 – – 2 333 438 iv 420
paul feltonsmith 142 – – – – 142 340
michael jackson 13 – – – – 13 78
roland tate 9 – – – – 9 62
greg hutchings – – – – – – 713
frederic hoad – – – – – – 70
total 834 171 52 5 333 1395 2266
notes to directors’ remuneration table above
i of the total bonus agreed by the committee in respect of louis eperjesi 50 was paid in cash in march 2011 and is disclosed in the table above the other 50 is deferred 
automatically into the deferred share bonus plan non cash benefits consist of life assurance membership of a private medical expenses arrangement and permanent 
health insurance cover
ii the 2010 total emoluments figures in respect of james brotherton are for the period from 28 may 2010 being his date of appointment to the board to 31 december 2010 
of the total bonus agreed by the committee in respect of james brotherton as a director 50 was paid in cash in march 2011 and is disclosed in the table above the other 
50 is deferred automatically into the deferred share bonus plan non cash benefits consist of life assurance and permanent health insurance cover
iii excluded from the table above is the remuneration received by james brotherton for the period up to his appointment to the board on 28 may 2010 in respect of the 2010 
financial year james brotherton received total cash remuneration as a director and employee of £281000
iv denis mulhall’s service agreement entitled him to receive twelve month’s salary and benefits upon termination non cash benefits consist of membership of life assurance 
membership of a private medical expenses arrangement and permanent health insurance cover
louis eperjesi and james brotherton are not members of any of the company’s pension schemes during 2010 louis eperjesi 
entered into salary sacrifice arrangements with the company to pay £46000 of his salary directly into his personal pension plan
deferred share bonus plan awards
awards made on 23 march 2011 in respect of the 2010 financial year under the deferred share bonus plan to executive directors 
are set out below
deferred share bonus plan award date
market 
value at 
award date
shares 
over which 
deferred 
bonus 
awards 
granted 
after the 
year end
1
normal 
vesting date
louis eperjesi 23mar11 £13265 86880 23mar14
james brotherton 23mar11 £13265 68819 23mar14
1 the number of shares awarded is calculated by dividing onehalf of the gross value of the bonus payable by the market value of a share market value means the average of 
the daily closing prices of a share over the five dealing days immediately preceding the award date 28
lupus capital plc
annual report  accounts 2010
ltip
directors’ interests in awards made under the ltip are set out below
awards of £nil cost share options made under the ltip award date
market  
value at 
awards date
shares 
over which 
ltip 
awards 
held at 
1 jan 
2010
shares  
over which 
ltip  
awards 
granted 
during the 
year
shares 
over which 
ltip 
awards 
held at 
31 dec 
2010
expected 
vesting
 date
louis eperjesi 10dec10 £10375 – 200000    200000    23mar14
james brotherton 10dec10 £10375 – 150000    150000    23mar14
options
directors’ interests in options over ordinary shares in the company are set out below
options
options at  
1 jan 2010  
or on later  
appointment
exercised in 
year
granted in 
year
lapsed in 
year
options 
at 31 dec 
2010
exercise 
price
earliest 
normal 
vesting date
james brotherton 100000 – – – 100000  £038 25jul11
james brotherton was awarded options over 100000 shares in july 2008 subject to an eps performance condition for the year 
ended 31 december 2010 the group’s underlying eps for the year ended 31 december 2010 was less than the minimum 
performance threshold of 1352p per share and consequently following the signing of these accounts on 23 march 2011 these 
options will lapse
nonexecutive directors’ fees
the basic fees of the nonexecutive chairman are £90000 per year and £30000 per year for the other nonexecutive directors 
during 2010 martin towers agreed with the company to have all his fees paid directly into his personal pension plan with effect 
from april 2010 which amounted to £22500
shares
the directors’ interests in ordinary shares beneficially held of the company at the end of the financial year were as follows
ordinary shares
ordinary 
shares at  
31 dec 
2010
ordinary 
shares at  
31 dec 
2009
jamie pike 325000  260000    
louis eperjesi 145000  na
james brotherton 149191  na
martin towers 50000    50000     
leslie tench 93750    38750     
denis mulhall na 665000    
paul feltonsmith na –
michael jackson na 123847    
roland tate na 110242    
keith taylor na –
share price
the market price of ordinary shares in lupus capital plc at 31 december 2010 was £111275 and the range during the year was 
£054 to £116
by order of the board 
cavendish administration limited
company secretary 
23 march 2011 
directors remuneration report  ⁄ continued  29
lupus capital plc
annual report  accounts 2010
independent auditor’s report to the members of lupus capital plc ⁄
we have audited the group financial statements of lupus capital plc for the year ended 31 december 2010 which comprise the 
consolidated income statement the consolidated statement of comprehensive income the consolidated statement of changes in 
equity consolidated balance sheet the consolidated cash flow statement and the related notes the financial reporting framework 
that has been applied in their preparation is applicable law and international financial reporting standards ifrss as adopted by 
the european union
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 directors’ responsibilities statement the directors are responsible for the preparation of the group 
financial statements and for being satisfied that they give a true and fair view our responsibility is to audit and express an opinion 
on the group 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
a description of the scope of an audit of financial statements is provided on the apb’s website at  
wwwfrcorgukapbscopeprivatecfm
opinion on financial statements
in our opinion the group financial statements
give a true and fair view of the state of the group’s affairs as at 31 december 2010 and of its profit for the year then ended •	
have been properly prepared in accordance with ifrs as adopted by the european union and •	
have been prepared in accordance with the requirements of the companies act 2006 •	
opinion on other matter prescribed by the companies act 2006
in our opinion the information given in the directors’ report for the financial year for which the group financial statements are 
prepared is consistent with the group financial statements
matters on which we are required to report by exception
we have nothing to report in respect of the following
under the companies act 2006 we are required to report to you if in our opinion
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 •	
other matter
we have reported separately on the parent company financial statements of lupus capital plc for the year ended  
31 december 2010
charles huttonpotts bsc fca
senior statutory auditor
for and on behalf of grant thornton uk llp
statutory auditor chartered accountants
london
23 march 2011 30
lupus capital plc
annual report  accounts 2010
consolidated income statement ⁄
for the year ended 31 december 2010
note
2010 
£’000
2009 
£’000
revenue 3 266212 241621
cost of sales 173403 161104
gross profit 92809 80517
administrative expenses 71278 68527
operating profit 5 21531 11990
analysed as
operating profit before exceptional items and amortisation of intangible assets 33675 25598
exceptional items 4 395 2055
amortisation of intangible assets 10 11749 11553
operating profit 21531 11990
finance income 7 566 450
finance costs 7 12562 13089
net finance costs 11996 12639
profitloss before taxation 9535 649
income tax expensecredit 8 2488 1062
profit for the year 7047 413
earnings per share
– basic eps from continuing operations 9 543p 032p
– diluted eps from continuing operations 9 535p 032p
all results relate to continuing operations
note
2010 
£’000
2009 
£’000
non gaap measure
underlying
1
 profit before taxation 24533 15718
earnings per share
– underlying
1
 basic eps from continuing operations 9 1306p 939p
– underlying
1
 diluted eps from continuing operations 9 1286p 939p
1 before amortisation of intangible assets deferred tax on amortisation of intangible assets exceptional items unwinding of discount on provisions amortisation of borrowing 
costs and the associated tax effect 31
lupus capital plc
annual report  accounts 2010
share 
capital 
£’000
share 
premium 
£’000
other
reserves
1
£’000
treasury 
reserve 
£’000
hedging 
reserve 
£’000
translation 
reserve 
£’000
retained 
earnings 
£’000
total 
£’000
at 1 january 2009 6864 101 10389 6764 3938 40819 189929 237400
share based payments – – – – – – 23 23
transactions with owners – – – – – – 23 23
profit after tax – – – – – – 413 413
other comprehensive incomeexpense
exchange differences on retranslation  
of foreign operations – – – – – 11892 – 11892
change in fair value of cash flow hedge – – – – 547 – – 547
losses on settled cash flow hedges released 
to the income statement – – – – 1996 – – 1996
actuarial loss on defined benefit pension 
schemes – – – – – – 926 926
total comprehensive incomeexpense for  
the period – – – – 1449 11892 513 10956
at 31 december 2009 6864 101 10389 6764 2489 28927 189439 226467
share based payments – – – – – – 63 63
transactions with owners – – – – – – 63 63
profit after tax – – – – – – 7047 7047
other comprehensive incomeexpense
exchange differences on retranslation  
of foreign operations – – – – – 4511 – 4511
change in fair value of cash flow hedge – – – – 1925 – – 1925
losses on settled cash flow hedges released 
to the income statement – – – – 2489 – – 2489
actuarial loss on defined benefit pension 
schemes – – – – – – 77 77
total comprehensive income for the period – – – – 564 4511 6970 12045
at 31 december 2010 6864 101 10389 6764 1925 33438 196472 238575
1 other reserves are nondistributable capital reserves which arose on previous acquisitions
consolidated statement of changes in equity ⁄
for the year ended 31 december 2010
consolidated statement of comprehensive income ⁄
for the year ended 31 december 2010
note
2010 
£’000
2009 
£’000
profit for the year 7047 413
actuarial losses on defined benefit plans 117 1403
exchange differences on retranslation of foreign operations 4511 11892
effective portion of changes in value of cash flow hedges 564 1449
tax on items recognised directly in other comprehensive income 8 40 477
other comprehensive income for the year net of tax 4998 11369
total comprehensive incomeexpense attributable to equity shareholders of the company 12045 10956 32
lupus capital plc
annual report  accounts 2010
note
2010 
£’000
2009 
£’000
assets
noncurrent assets
intangible assets 10 328240 333998
property plant and equipment 11 31457 34296
deferred tax 8 7654 7792
367351 376086
current assets
current tax receivable – 395
inventories 12 26048 26036
trade and other receivables 14 32922 29850
cash and cash equivalents 27748 24955
86718 81236
total assets 454069 457322
liabilities
current liabilities
current tax payable 2679 –
trade and other payables 15 40365 36815
provisions 17 3584 3353
finance lease obligations 16 9 8
derivative financial instruments 13 – 2534
interest bearing loans and borrowings 16 5163 3063
51800 45773
noncurrent liabilities
finance lease obligations 16 1 10
deferred tax 8 23369 26091
interest bearing loans and borrowings 16 114304 132887
employee benefit liability 19 7474 7650
provisions 17 14989 17662
derivative financial instruments 13 1998 –
other creditors 1559 782
163694 185082
total liabilities 215494 230855
net assets 238575 226467
equity
capital and reserves attributable to equity holders of the company
called up share capital 20 6864 6864
share premium 101 101
other reserves 10389 10389
treasury reserve 6764 6764
hedging reserve 1925 2489
translation reserve 33438 28927
retained earnings 196472 189439
total equity 238575 226467
the financial statements were approved by the board on 23 march 2011 and signed on its behalf by
louis eperjesi    james brotherton
chief executive officer   chief financial officer
consolidated balance sheet ⁄
as at 31 december 2010 33
lupus capital plc
annual report  accounts 2010
note
2010 
£’000
2009 
£’000
cash flows from operating activities
profitloss before tax 9535 649
adjustments 22 30666 32839
movement in inventories 451 9752
movement in trade and other receivables 2728 3840
movement in trade and other payables 4011 2878
provisions utilised 2515 2981
pension contributions 841 1317
income tax paid 2304 2155
net cash inflow from operating activities 36275 36451
investing activities
payments to acquire property plant and equipment 3314 2144
payments to acquire intangible assets 197 91
interest received 566 450
net cash outflow from investing activities 2945 1785
financing activities
interest paid 9822 10981
refinancing costs paid 23 7405
repayment of short term borrowings 21147 22780
repayment of capital element of finance leases 8 242
net cash outflow from financing activities 31000 41408
increasedecrease in cash and cash equivalents 2330 6742
effect of exchange rates on cash and cash equivalents 463 710
cash and cash equivalents at the beginning of the year 24955 32407
cash and cash equivalents at the year end 27748 24955
group cash flow statement ⁄
for the year ended 31 december 2010 34
lupus capital plc
annual report  accounts 2010
1 basis of preparation and accounting policies
the group’s principal activities are the manufacture supply and distribution of building products and the manufacture and supply 
of coupling products to the oil and gas industry lupus capital plc is the group’s ultimate parent company and it is incorporated 
and domiciled in england and wales at the address shown on page 65
the group’s shares are admitted to trading on aim a market of the london stock exchange
the group’s consolidated financial statements are prepared in accordance with the principal accounting policies adopted by the 
group as set out in note 2 and international financial reporting standards “ifrs” and international financial reporting 
interpretations “ifric” as adopted for use in the european union eu and with those parts of the companies act 2006 
applicable to companies reporting under ifrs
the following standards have been amendedimplemented during the year the group’s consolidated financial statements have 
been prepared in accordance with these changes where relevant
ifrs 2 amendments ‘group cashsettled sharebased payment transactions’ incorporates ifric 8 ‘scope of ifrs 2’ and •	
ifric 11 ‘ifrs 2 – group and treasury share transactions’ and expands on the guidance in ifric 11 to address the 
classification of group arrangements
ifrs 3 revised ‘business combinations’ and consequential amendments to ias 27 ‘consolidated and separate financial •	
statements’ ias 28 ‘investments in associates’ and ias 31 ‘interests in joint ventures’ are effective prospectively to business 
combinations for which the acquisition date is on or after the beginning of the first annual reporting period beginning on or after 
1 july 2009 
ifrs 5 amendment ‘noncurrent assets held for sale and discontinued operations’ clarifies the disclosures required in •	
respect of noncurrent assets or disposal groups classified as held for sale or discontinued operations 
ias 1 amendment ‘presentation of financial statements’ clarifies that the potential settlement of a liability by the issue of •	
equity is not relevant to its classification as current or noncurrent 
ias 27 revised requires the effects of all transactions with noncontrolling interests to be recorded in equity if there is no •	
change in control and these transactions will no longer result in goodwill or gains and losses 
ias 36 amendment ‘impairment of assets’ clarifies that the largest cash generating unit or group of units to which goodwill •	
should be allocated for the purposes of impairment testing is an operating segment as defined by paragraph 5 of ifrs 8 
‘operating segments’ 
ifric 9 ‘reassessment of embedded derivatives and ias 39 financial instruments recognition and measurement’ requires •	
an entity to assess whether an embedded derivative should be separated from a host contract when the entity reclassifies a 
hybrid financial asset out of the ‘fair value through profit or loss’ category 
ifric 16 ‘hedges of a net investment in a foreign operation’ states that in a hedge of a net investment in a foreign operation •	
qualifying hedging instruments may be held by any entity or entities within the group including the foreign operation itself as 
long as the designation documentation and effectiveness requirements of ias 39 that relate to a net investment hedge are 
satisfied 
ifric 17 ‘distribution of noncash assets to owners’ provides guidance on accounting for arrangements whereby an entity •	
distributes noncash assets to shareholders either as a distribution of reserves or as dividends 
ifric 18 ‘transfers of assets from customers’ clarifies the requirements of ifrss for agreements in which an entity receives an •	
item of property plant and equipment from a customer
going concern
the financial statements have been prepared on the going concern basis which assumes that the group will have sufficient funds 
to continue in operational existence for the foreseeable future
the group’s debt facilities expire in july 2012 and the group expects that it will be able to meet its debt facility interest and 
repayment obligations accordingly the group has assumed that the going concern basis of preparation of these financial 
statements is appropriate
2 summary of significant accounting policies
accounting convention
the financial statements are prepared under the historic cost convention as modified by the revaluation of certain financial 
instruments the measurement basis and significant accounting policies are set out below
basis of consolidation
the financial statements consolidate the company and its subsidiary undertakings note 25 drawn up to 31 december each 
year the financial statements of the subsidiaries are prepared as of the same reporting date as the parent using consistent 
accounting policies 
subsidiaries are fully consolidated from the date on which control over financial and operating policies is transferred to the group 
and continue to be consolidated until the date that such control ceases 
notes to the financial statements ⁄ 35
lupus capital plc
annual report  accounts 2010
2 summary of significant accounting policies continued
all business combinations are accounted for using the purchase method the cost of a business combination is measured as the 
aggregate of the fair values at the acquisition date of any assets given liabilities incurred or assumed including contingent 
liabilities and equity instruments issued by the group the identifiable assets and liabilities of the acquiree are measured initially  
at fair value at the acquisition date the excess of the cost of the business combination over the group’s interest in the net fair 
value of the identifiable assets including those of an intangible and tangible nature liabilities and contingent liabilities is recognised 
as goodwill
intercompany transactions balances and unrealised gains on transactions between group companies are eliminated unrealised 
losses are also eliminated but are considered an impairment indicator of the asset transferred accounting policies of subsidiaries 
have been changed where necessary to ensure consistency with the policies adopted by the group 
recent accounting developments
during the year the iasb and ifric have issued the following standards and interpretations with effective dates after the date of 
these financial statements that have not yet been adopted by the company
ifrs 9 financial instruments effective 1 january 2013 •	
prepayments of a minimum funding requirement – amendments to ifric 14 effective 1 january 2011 •	
improvements to ifrss issued 16 april 2009 •	
ias 24 revised 2009 related party disclosures effective 1 january 2011 •	
disclosures – transfers of assets  amendments to ifrs7 effective july 2011 •	
the directors do not anticipate that the adoption of these standards and interpretations will have a material impact on the group’s 
reported results 
principal accounting policies
the preparation of financial statements in conformity with generally accepted accounting policies requires the directors to make 
judgments and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingencies at the date 
of the financial statements and the reported income and expense during the reporting periods 
although the judgments and assumptions are based on the directors’ best knowledge of the amount events or actions actual 
results may differ from these estimates
the accounting policies set out below have been used to prepare the financial statements 
goodwill
goodwill being the difference between the fair value of consideration paid for new interests in group companies and the fair value 
of the group’s share of their net identifiable assets and contingent liabilities at the date of acquisition is capitalised goodwill 
represents consideration paid by the group in anticipation of future economic benefits from assets that are not capable of being 
individually identified and separately recognised
goodwill is not amortised but is subject to an impairment review on an annual basis or more frequently when events or changes in 
circumstances indicate it might be impaired any impairment is charged to the income statement in the period in which it arises 
intangible assets
on acquisition of group companies the group recognises any separately identifiable intangible assets separately from goodwill 
initially measuring the intangible assets at fair value
purchased intangible assets acquired through a business combination including purchased brands customer relationships 
trademarks and licenses are capitalised at fair value and amortised on a straightline basis over their estimated useful economic 
lives as follows
acquired brands – 5 years to indefinite •	
customer relationships – 9 to 16 years and •	
trade marks and licenses – 3 to 4 years •	
the group capitalises acquired computer software at cost computer software is amortised on a straightline basis over its 
estimated useful life up to three years the carrying value of intangible assets with a finite life is reviewed for impairment whenever 
events or changes in circumstances indicate that the carrying value may not be recoverable
impairment of assets 
goodwill arising on business combinations is allocated to cashgenerating units equivalent to the reported operating segments 
the recoverable amount of the cashgenerating unit to which goodwill has been allocated is tested for impairment annually or 
more frequently when events or changes in circumstance indicate that it might be impaired goodwill that has been impaired 
previously cannot be reversed at a later date  36
lupus capital plc
annual report  accounts 2010
the carrying values of property plant and equipment and intangible assets with finite lives are reviewed for impairment when 
events or changes in circumstance indicate the carrying value may be impaired if any such indication exists the recoverable 
amount of the asset is estimated in order to determine the extent of impairment loss 
where purchased intangible assets are considered by the board of directors to have an indefinite life they are not amortised but 
are subject to an impairment review on an annual basis or more frequently if necessary intangible assets not yet available for use 
are tested for impairment annually 
an impairment review is performed by comparing the carrying value of the property plant and equipment or intangible asset or 
goodwill with its recoverable amount being the higher of the fair value less costs to sell and value in use the fair value less costs 
to sell is the amount that could be obtained on disposal of the asset the value in use is determined by discounting using a 
pretax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset the 
expected future cash flows resulting from its continued use including those on final disposal impairment losses are recognised in 
the income statement immediately where it is not possible to estimate the recoverable amount of an individual asset the group 
estimates the recoverable amount of the cashgenerating unit to which it belongs considerable management judgment is 
necessary to estimate discounted future cash flows accordingly actual cash flows could vary considerably from forecast cash 
flows impairment reversals are permitted to property plant and equipment or intangible assets but not goodwill to the extent 
that the new carrying value does not exceed the amount it would have been had no impairment loss been previously recognised
segment reporting
the group’s continuing operations are divided into two product segments oil and gas services and building products identified 
on the basis of internal reports about components of the group the group’s reporting formats are products and this is consistent 
with the segments reviewed by the chief operating decision maker a product segment is a component of the group that is 
engaged in providing a group of related products and is subject to risks and returns that are different from those of the other 
segments ifrs 8 also requires disclosure of information on geographical areas with the group’s system of internal reporting to 
key operating decision makers serving as a starting point
revenue
revenue is recognised to the extent that it is probable that economic benefit will flow to the group and the revenue can be reliably 
measured revenue represents amounts receivable for goods provided to customers during the year in the normal course of 
business net of trade discounts vat and other salesrelated taxes as such revenue from the sale of goods is recognised when 
the significant risks and rewards of ownership of the goods have passed to the buyer usually on dispatch of the goods 
cash and cash equivalent
cash and cash equivalents include cash at bank and in hand as well as shortterm highly liquid investments such as money 
market instruments and bank deposits readily convertible into cash money market instruments are financial assets carried at fair 
value through profit or loss 
interest bearing bank loans and borrowings
interest bearing bank loans and borrowings are recorded initially at fair value less directly attributable transaction costs after 
initial recognition interest bearing loans and borrowings are subsequently measured at amortised cost using the effective 
interest method
property plant and equipment
property plant and equipment are stated at cost less depreciation and impairment depreciation is provided on all assets except 
freehold land at rates calculated to write off the cost less estimated residual value of each asset on a straightline basis over its 
expected useful life at the following annual rates 
freehold land – not depreciated 
freehold buildings – 2 to 5 
plant and machinery – 75 to 33 
motor vehicles – 20 to 25 
the carrying values of property plant and equipment are reviewed for impairment periodically if events or changes in 
circumstances indicate that the carrying value may not be recoverable the assets’ residual values useful lives and method of 
depreciation are reviewed and adjusted if appropriate at each financial year end 
inventories
inventories are valued at the lower of cost and net realisable value cost includes cost of materials determined on a purchase 
cost basis direct labour and an appropriate proportion of manufacturing overheads based on normal levels of activity on a first in 
first out basis net realisable value is based on estimated selling prices less further costs expected to be incurred to completion 
and disposal 
notes to the financial statements  ⁄ continued 37
lupus capital plc
annual report  accounts 2010
2 summary of significant accounting policies continued
leases
where the group has substantially all the risks and rewards of ownership of an asset subject to a lease the lease is treated as a 
finance lease assets held under finance leases and similar contracts which confer the rights and obligations similar to those 
attached to owned assets are capitalised at the inception of the lease at the fair value or if lower the present value of the minimum 
lease payments lease payments are apportioned between the finance charges and reduction of the lease liability so as to 
achieve a constant rate of interest on the remaining balance of the liability finance charges are reflected in the income statement
all other leases are treated as operating leases and rentals payable are charged to the income statement account on a straight 
line basis over the lease term
foreign currencies
the individual financial statements of each group entity are presented in the currency of the primary economic environment in 
which the entity operates its functional currency for the purpose of the consolidated financial statements the results and 
financial position of each entity are expressed in pounds sterling which is the functional currency of the company and the 
presentation currency for the consolidated financial statements
in individual companies transactions in foreign currencies are recorded at the rate of exchange prevailing at the date of the 
transaction monetary assets and liabilities in foreign currencies are translated at the exchange rate prevailing at the balance sheet 
date any resulting exchange differences are taken to the income statement with the exception of differences on foreign currency 
borrowings that provide a hedge against a net investment in a foreign entity these are taken directly to equity until the disposal of 
the net investment at which time they are recognised in the consolidated income statement 
on consolidation assets and liabilities of group companies denominated in foreign currencies are translated into sterling at the 
exchange rate prevailing at the balance sheet date income and expense items are translated into sterling at the average rates for 
the year
exchange differences arising on the translation of opening net assets of group companies together with differences arising from 
the translation of the net results at average or actual rates to the exchange rate prevailing at the balance sheet date are taken to 
other comprehensive income on disposal of a foreign entity the cumulative translation differences recognised in other 
comprehensive income relating to that particular foreign operation is recognised in the income statement as part of the gain or 
loss on disposal 
provisions
provisions are recognised 
when the group has a present legal or constructive obligation as a result of a past event •	
it is probable that an outflow of resources will be required to settle the obligation and •	
the amount has been reliably estimated •	
restructuring provisions comprise lease termination penalties and employee termination payments 
provisions are determined at the present value of the expenditures expected to be required to settle the obligation using a pretax 
rate that reflects current market assessments of the time value of money and the risks specific to the obligation the increase in 
the provision due to the passage of time is recognised as interest expense 
pensions and other post employment benefits 
the group operates a defined contribution pension and two defined benefit schemes 
the cost of providing benefits under the defined benefit schemes is determined using the projected unit credit actuarial valuation 
method the operating and financing costs of the pension schemes are charged to the income statement in the period in which 
they arise and are recognised separately the costs of past service benefit enhancements settlements and curtailments are also 
recognised in the period in which they arise the past service cost is recognised as an expense on a straight line basis over the 
average period until the benefits become vested if the benefits are already vested immediately following the introduction of or 
changes to a pension plan past service costs are recognised immediately actuarial gains and losses are recognised immediately 
through the consolidated statement of comprehensive income the net surplus or deficit is presented with the other net assets on 
the balance sheet the related deferred tax is shown with the other deferred tax balances
the defined benefit assets and liabilities comprise the present value of the defined benefit obligations less the past service cost 
not yet recognised and less the fair value of plan assets out of which the obligations are to be settled directly the value of any 
assets is restricted to the sum of any past service costs not yet recognised and the present value of any economic benefit 
available in the form of refunds from the plan or reductions in the future contributions to the plan 
contributions to the defined contribution scheme are charged to the income statement as incurred  38
lupus capital plc
annual report  accounts 2010
share capital
ordinary shares are classified as equity
where any group company purchases the company’s equity share capital treasury shares the consideration paid including any 
directly attributable incremental costs net of income taxes is deducted from equity attributable to the company’s equity holders 
until the shares are cancelled or reissued where such shares are subsequently sold or reissued any consideration received net 
of any directly attributable incremental transaction costs and the related income tax effects is included in equity attributable to the 
company’s equity holders
financial assets liabilities and derivatives 
financial assets and liabilities are recognised on the group’s balance sheet when the group becomes a party to the contractual 
provisions of the instrument and are generally derecognised when the contract that gives rise to it is settled sold cancelled 
or expires
trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest 
rate method less appropriate allowances for estimated irrecoverable amounts trade payables are recognised initially at fair value 
and subsequently measured at amortised cost using the effective interest rate method 
provision against trade receivables is made when there is objective evidence that the group will not be able to collect all amounts 
due to it in accordance with the original terms of those receivables the amount of the writedown is determined as the difference 
between the carrying amount and present value of estimated future cash flows
derivative financial instruments are initially recognised at fair value on the date on which a derivative contract is entered into and 
are subsequently remeasured at fair value derivatives are carried as assets when fair value is positive and as liabilities when fair 
value is negative
for those instruments designated as hedges and for which hedge accounting is desired the hedging relationship is documented 
at its inception this documentation identifies the hedging instrument the hedged item or transaction the nature of the risk 
being hedged and how effectiveness will be measured throughout its duration such hedges are expected at inception to be 
highly effective
for the purpose of hedge accounting hedges are classified as either fair value hedges when they hedge the exposure to changes 
in the fair value of a recognised asset or liability hedge of net investment in foreign operations where they hedge exposure to 
changes in fair value or future cash flows of the investment or cash flow hedges where they hedge exposure to variability in cash 
flows that is either attributable to a particular risk associated with a recognised asset or liability or a highly probable purchase
in relation to fair value hedges which meet the conditions for hedge accounting any gain or loss from remeasuring the hedging 
instrument at fair value is recognised immediately in the income statement any gain or loss on the hedged item attributable to the 
hedged risk is adjusted against the carrying amount of the hedged item and recognised in the income statement
in relation to cash flow hedges forward foreign currency contracts to hedge either highly probable anticipated purchases or firm 
commitments which meet the conditions for special hedge accounting the portion of the gain or loss on the hedging instrument 
that is determined to be an effective hedge is recognised directly in other comprehensive income and the ineffective portion is 
recognised in net profit or loss
when the hedged firm commitment results in the recognition of a nonfinancial asset or a nonfinancial liability then at the time 
the asset or liability is recognised the associated gains or losses that were previously recognised in other comprehensive income 
are included in the initial measurement of the acquisition cost or other carrying amount of the asset or liability for all other cash 
flow hedges the gains or losses that are recognised in other comprehensive income are transferred to the income statement 
in the same year in which the hedged firm commitment affects the net profit and loss for example when the future sale  
actually occurs
for derivatives that do not qualify for hedge accounting any gains or losses arising from changes in fair value are taken directly to 
net profit or loss for the year
investments in foreign operations
a foreign currency exposure arises from net investments in group entities whose functional currency differs from the group’s 
presentation currency the group uses foreign currency loans to hedge foreign currency risk this translation risk does not give 
rise to a cash flow exposure its impact only arises from the translation of the net investment in the group’s presentation currency
notes to the financial statements  ⁄ continued 39
lupus capital plc
annual report  accounts 2010
2 summary of significant accounting policies continued
deferred taxation 
income tax expense represents the sum of the current tax and deferred tax the tax currently payable is based on taxable profit 
for the year taxable profit differs from net profit as reported in the income statement because it excludes items of income or 
expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible the 
group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the balance 
sheet date 
deferred income tax is the tax expected to be payable or recoverable on differences between the carrying amount of assets and 
liabilities in the financial statements and the corresponding tax basis used in the computation of taxable profit and is accounted for 
using the balance sheet liability method deferred income tax liabilities are generally recognised for all taxable temporary 
differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against 
which deductible temporary differences can be utilised such assets and liabilities are not recognised if the temporary difference 
arises from goodwill or from the initial recognition other than in a business combination of other assets and liabilities in a 
transaction that affects neither the tax profit nor the accounting profit 
deferred income tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and 
associates and interests in joint ventures except where the group is able to control the reversal of the temporary difference and it 
is probable that the temporary difference will not reverse in the foreseeable future 
the carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no 
longer probable that sufficient taxable profit will be available to allow all or part of the asset to be recovered 
deferred income tax is calculated at the tax rates enacted at the balance sheet dates and that are expected to apply in the period 
when the liability is settled or the asset realised deferred tax is charged or credited in the comprehensive income statement 
except when it relates to items charged or credited directly to other comprehensive income in which case the deferred tax is also 
dealt with in other comprehensive income 
deferred income tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the 
group intends to settle its current tax assets and liabilities on a net basis 
exceptional items
the group presents as exceptional items on the face of the income statement those material items of income and expense which 
because of the nature and expected infrequency of the events giving rise to them merit separate presentation to allow 
shareholders to understand better the elements of financial performance in the year so as to facilitate comparison with prior 
periods and to assess better trends in financial performance 
sharebased payments 
the group has an equity settled share based remuneration scheme for certain employees the parent company issues equity
settled sharebased payments to certain employees equitysettled sharebased payments are measured at fair value at the date 
of grant the fair value determined at the grant date of the equitysettled sharebased payments is expensed on a straightline 
basis over the vesting period based on the group’s estimate of shares that will eventually vest
fair value is measured by use of the black scholes model the expected life used in the model has been adjusted based on 
management’s best estimate for the effects of nontransferability exercise restrictions and behavioural considerations
non gaap measure accounting policy
the directors believe that the “underlying” profit and earnings per share measures provide additional useful information to 
shareholders on the underlying performance of the business these measures are consistent with how business performance is 
measured internally the adjusted profit before tax measure is not recognised under ifrs and may not be comparable with 
“underlying” profit measures used by other companies the adjustments made to reported profit before tax are to include 
the following
exceptional income and charges these are largely oneoff in nature and therefore create volatility in reported earnings and •	
amortisation of intangible items and borrowing costs because of their noncash nature and expected infrequency of the events •	
giving rise to them
key judgements by management
the following areas represent the key judgements made by management in order to facilitate the preparation of the group’s 
financial statements
taxation 
the group is subject to taxation in numerous jurisdictions judgement is required in determining the world wide provision for 
income taxes as there are transactions for which the ultimate tax determination is uncertain 40
lupus capital plc
annual report  accounts 2010
impairment reviews and discount rates
the group tests intangible assets and goodwill for impairment in accordance with the stated accounting policy the value in use 
calculations require the use of estimates of future activity and assessment of appropriate discount rates
key sources of estimation uncertainty
the preparation of financial statements requires management to make judgements estimates and assumptions the key 
assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date that have a 
significant risk of causing material adjustment to the carrying amounts of assets and liabilities within the next financial year are 
discussed below
impairment of goodwill and other intangible assets
there are a number of assumptions management have considered in performing impairment reviews of goodwill and intangible 
assets in determining whether goodwill is impaired an estimation of value in use of the cashgenerating units to which goodwill 
has been allocated has been prepared the value in use calculation requires the directors to estimate the future cash flows 
expected to arise from the cashgenerating unit and a suitable discount rate in order to calculate present value note 10 
provisions
provisions are measured at the directors’ best estimate of the expenditure required to settle the obligation at the balance sheet 
date and are discounted to present value where the effect is material note 17
valuation of financial instruments at fair value
management makes a number of assumptions with regards to the models used to value financial instruments at their fair value at 
year end valuation techniques commonly used by market practitioners are applied for derivative financial instruments 
assumptions are made based on quoted market rates adjusted for specific features of the instrument note 13
intangible assets acquired in a business combination
on acquisition of group companies the group recognises any separately identifiable intangible assets from goodwill initially 
measuring each group of intangible assets at fair value groups of intangible assets will include purchased brands customer 
relationships trade marks and licenses the determination of fair value requires the directors to estimate the useful economic life 
each asset and the future cash flows expected to arise from each asset and to apply a suitable discount rate note 10 
inventories
inventories are stated at the lower of cost and net realisable value with due allowance for excess obsolete or slowmoving items 
net realisable value is based on current assessments of future demand market conditions and new product development 
initiatives should demand for the group’s products decline further during the next financial year as a result of the current 
economic downturn additional allowances may be necessary in respect of excess or slowmoving items note 12
defined benefit pension and post retirement benefit schemes
the benefit obligation is calculated using a number of assumptions including future salary increases increases to pension 
benefits mortality rates and in the case of postemployment medical benefits the expected rate of increase in medical costs the 
present value of the benefit obligation is calculated by discounting the benefit obligation using market yields on highquality 
corporate bonds at the balance sheet date the plan assets consist largely of listed securities and their fair values are subject to 
fluctuation in response to changes in market conditions effects of changes in the actuarial assumptions underlying the benefit 
obligation effects of changes in the discount rate applicable to the benefit obligation and effects of differences between the 
expected and actual return on the plan assets are classified as actuarial gains and losses and are recognised directly in equity 
further actuarial gains and losses will be recognised during the next financial year an analysis of the assumptions that will be 
used by management to determine the cost of defined benefit plans that will be recognised in the income statement in the next 
financial year is presented in note 19
deferred tax assets
estimation is required of temporary differences between the carrying amount of assets and liabilities and their tax base deferred 
tax liabilities are recognised for all taxable temporary differences but where deductible temporary differences exist 
management’s judgement is required as to whether a deferred tax asset should be recognised based on the availability of future 
taxable profits it is possible that the deferred tax assets actually recoverable may differ from the amounts recognised if actual 
taxable profits differ from management’s estimates note 8
notes to the financial statements  ⁄ continued 41
lupus capital plc
annual report  accounts 2010
3 segmental analysis
product analysis
the following tables present reported group revenue and profit and certain assets and liability information regarding the group’s 
product segments which have been generated using group accounting policies with no differences of measurement applied
building 
products
oil and gas 
services total
year ended 31 december 2010
united 
kingdom 
£’000
united 
states 
£’000
rest of the 
world 
£’000
total 
£’000
united 
kingdom 
£’000
  
£’000
revenue
revenue from continuing operations 94676 117179 40609 252464 13748 266212
operating profit before exceptional items and amortisation of  
intangible assets 7880 14444 4514 26838 6837 33675
amortisation of intangible assets 11749 – 11749
exceptional items note 4 395
operating profit 21531
net finance costs 11996
profit before taxation 9535
income tax expense 2488
profit after tax 7047
other segment information
segment assets 106843 266565 57610 431018 17384 448402
unallocated assets 5667
454069
segment liabilities 35607 43826 5846 85279 4782 90061
unallocated segment liabilities 118729 118729
unallocated group liabilities 6704
204008 215494
noncurrent assets 75425 234508 45693 355626 11725 367351
capital expenditure
– property plant and equipment 1268 1542 446 3256 58 3314
– intangible assets 51 137 9 197 – 197
cost of goods sold 169468 3935 173403
depreciation 6449 44 6493
amortisation 11749 – 11749
employee benefit liabilities 7474 – 7474
goodwill allocation 212110 11421 223531
intangible asset allocation 104709 – 104709
exceptional items note 4 146 – 146
exceptional items – unallocated note 4 249
all revenue comprises amounts earned on amounts receivable from customers there is no single external customer from whom 
significant revenue is generated 42
lupus capital plc
annual report  accounts 2010
3 segmental analysis continued
comparative segmental disclosure for the year ended 31 december 2009 is as follows
building 
products
oil and gas 
services total
year ended 31 december 2009
united
kingdom
£’000
united 
states
£’000
rest of the
world
£’000
total
£’000
united
kingdom
£’000 £’000
revenue
revenue from continuing operations 79718 105666 43647 229031 12590 241621
operating profit before exceptional items and amortisation of  
intangible assets 6276 10836 2586 19698 5900 25598
amortisation of intangible assets 11533 – 11553
exceptional items note 4 2055
operating profit 11990
net finance costs 12639
loss before taxation 649
income tax credit 1062
profit after tax 413
other segment information
segment assets 105451 268622 62588 436661 20550 457211
unallocated assets 111
457322
segment liabilities 32944 43348 7485 83777 2150 85927
unallocated segment liabilities 140975 140975
unallocated group liabilities – 3953
224752 230855
noncurrent assets 74391 241087 48881 364359 11727 376086
capital expenditure
– property plant and equipment 906 1054 158 2118 26 2144
– intangible assets – 86 5 91 – 91
cost of goods sold 157384 3720 161104
depreciation 70 70 –
amortisation 11553 – 11553
employee benefit liabilities 7650 – 7650
goodwill allocation 208429 11421 219850
intangible asset allocation 114148 – 114148
exceptional items note 4 335 – 335
exceptional items – unallocated note 4 1720
4 exceptional items
2010
£’000
2009
£’000
redundancy and restructuring costs 151 695
other corporate costs including egm costs 244 708
costs associated with negotiating new debt facilities – 1232
other – 580
395 2055
5 operating profit
operating profit is stated after charging the following
2010
£’000
2009
£’000
depreciation of property plant and equipment – owned assets 6294 6520
depreciation of property plant and equipment – leased assets 199 221
amortisation of intangible assets 11749 11553
operating lease rentals – land and buildings 4009 3924
fees payable to the company’s auditors for the audit of the group accounts 94 91
fees payable to the company’s auditors or their associates for other services
– audit of the company’s subsidiaries 399 392
– tax general and other services 31 70
foreign exchange loss 254 101
notes to the financial statements  ⁄ continued 43
lupus capital plc
annual report  accounts 2010
6 employees
number of employees
the average monthly number of employees including directors of the group during the financial year was
2010
number
2009
number
administration 217 236
sales 176 170
operations 1697 1635
2090 2041
the number of employees including directors of the group as at 31 december 2010 was
2010
number
2009
number
administration 230 227
sales 200 167
operations 1574 1609
2004 2003
employment costs
employment costs of these employees during the year were as follows
2010
£’000
2009
£’000
wages and salaries 51508 49880
social security costs 5547 5466
pension costs – defined contribution schemes 1037 820
pension costs – defined benefit schemes 1035 798
share based payments 63 23
59190 56987
directors’ remuneration 
the remuneration payable to directors was as follows
2010 
£’000
2009 
£’000
salaryfees 834 1266
bonuses 171 510
benefits 57 4
sharebased payments 6 18
severence payments 333 481
total 1401 2279 44
lupus capital plc
annual report  accounts 2010
7 finance revenue and costs 
2010 
£’000
2009 
£’000
finance income
bank interest receivable 566 450
finance costs
interest payable on bank loans and overdraft 9429 9901
amortisation of borrowing costs 2295 2125
ineffective portion of changes in value of cash flow hedges 26 45
finance charges payable under finance lease and hire purchase contracts 1 29
unwinding of discount on provisions 559 634
pension scheme and other finance costs 252 355
total finance costs 12562 13089
net finance costs 11996 12639
8 taxation
a tax on profit on ordinary activities
income tax in the income statement
2010 
£’000
2009 
£’000
current income tax
uk corporation tax 755 798
foreign tax 5090 905
current income tax charge 5845 1703
adjustments in respect of prior periods 497 766
total current income tax 5348 937
deferred tax
origination and reversal of temporary differences 2216 1911
change in uk statutory tax rates 892 –
adjustments in respect of prior periods 248 88
total deferred tax 2860 1999
income tax expensecredit in the income statement 2488 1062
tax relating to items charged or credited directly to other comprehensive income
deferred tax
actuarial gains and losses on pension schemes 40 477
income tax expense in the statement of comprehensive income 40 477
b reconciliation of the total tax charge
the tax assessed for the year differs from the standard rate of tax in the uk of 28 2009 28 the differences are 
explained below
2010 
£’000
2009 
£’000
profitloss from continuing operations before taxation 9535 649
rate of corporation tax in the uk of 28 2009 28 2670 182
effects of
expenses not deductibleincome not taxable for tax purposes 167 158
overseas tax rate differences 790 182
change in uk statutory tax rates 892 –
other movements – 50
adjustment in respect of prior periods 247 854
income tax expensecredit in the income statement 2488 1062
notes to the financial statements  ⁄ continued 45
lupus capital plc
annual report  accounts 2010
8 taxation continued
c deferred tax
deferred income tax at 31 december relates to the following
group balance sheet group income statement
2010 
£’000
2009 
£’000
2010 
£’000
2009 
£’000
deferred tax liability
 intangible assets on acquisition 22808 24527 4271 3230
 other 561 1564 1241 795
23369 26091 3030 2435
deferred tax assets
 postemployment benefits 1705 1640 – –
 purchased goodwill 4612 4761 290 592
 other 1337 1391 120 156
7654 7792 170 436
deferred income tax income 2860 1999
deferred tax liabilities net 15715 18299
reflected in the balance sheet as follows
 deferred tax assets 7654 7792
 deferred tax liabilities 23369 26091
deferred tax liabilities net 15715 18299
d factors that may affect future tax charges
there are estimated tax losses of £9980000 2009 £13296000 within the group comprising capital losses of £7348000  
and trading losses of £2632000 as the future use of these losses is uncertain in accordance with the group’s accounting policy 
no deferred tax asset has been recognised in respect of them
the amounts of deferred tax not recognised are as follows
2010 
£’000
2009 
£’000
tax losses 785 1666
capital losses 2057 2057
2842 3723
9 earnings per share
basic earnings per share amounts are calculated by dividing net profit for the year attributable to ordinary equity holders by the 
weighted average number of ordinary shares outstanding during the year
diluted earnings per share amounts are calculated by dividing the net profit attributable to ordinary equity holders by the weighted 
average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would 
be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares 
2010 
’000
2009 
’000
weighted average number of shares including treasury shares 137287 137287
treasury shares 7447 7447
weighted average number of shares – basic 129840 129840
effect of dilutive potential ordinary shares – options 1967 –
weighted average number of shares – diluted 131807 129840
the effect of dilutive potential ordinary shares above is nil in 2009 due to the average market value of the shares being less than 
the option price
earnings per share from continuing operations before exceptional items
the group presents as exceptional items on the face of the income statement those material items of income and expense which 
because of the nature and expected infrequency of the events giving rise to them merit separate presentation to allow 
shareholders to understand better the elements of financial performance in the year so as to facilitate comparison with prior 
periods and to assess better trends in financial performance 46
lupus capital plc
annual report  accounts 2010
9 earnings per share continued
to this end basic and diluted underlying earnings per share information is presented as an additional measure and using the 
weighted average number of ordinary shares for both basic and diluted amounts as per the table above underlying earnings are 
derived as follows
2010 
£’000
2009 
£’000
profit for the year from continuing operations 7047 413
exceptional costs 395 2055
amortisation of intangible assets unwinding discount on provisions and amortisation of borrowing costs 14603 14312
adjustment due to deferred tax rate change 892 –
tax effect on exceptional costs amortisation of intangible assets unwinding discount  
on provision and amortisation of borrowing costs 4199 4582
underlying profit after tax 16954 12198
underlying basic earnings per share 1306p 939p
underlying diluted earnings per share 1286p 939p
10 intangible assets
computer 
software 
£’000
acquired 
brands 
£’000
customer 
relations 
£’000
goodwill 
£’000
total 
£’000
cost
at 1 january 2009 598 34979 124517 234085 394179
additions – 91 – – 91
amounts written off 307 – – – 307
exchange difference 46 2057 8917 14235 25255
at 31 december 2009 245 33013 115600 219850 368708
additions 119 78 – – 197
amounts written off 7 – – – 7
exchange difference – 489 2197 3681 6367
at 31 december 2010 357 33580 117797 223531 375265
amortisation
at 1 january 2009 53 7176 17690 – 24919
amortisation for the year 26 3294 8233 – 11553
exchange difference 4 528 1230 – 1762
at 31 december 2009 75 9942 24693 – 34710
amortisation for the year
1
102 3346 8301 – 11749
amounts written off 7 – – – 7
exchange difference – 175 398 – 573
at 31 december 2010 170 13463 33392 – 47025
net book value
at 31 december 2010 187 20117 84405 223531 328240
at 31 december 2009 170 23071 90907 219850 333998
1  amortisation for the year is included in administrative expenses in the income statement
impairment tests for goodwill
the group tests goodwill annually for impairment or more frequently if there are indications that goodwill might be impaired the 
recoverable amounts of the cashgenerating units “cgu” are determined from value in use calculations the cgu’s have been 
defined as the three groups of businesses acquired that each generated the current goodwill and intangibles assets namely gall 
thomson and the two building products acquisitions the net book value of the intangible assets and goodwill is analysed by 
cgu below 
intangible assets goodwill
cgu
2010  
£’000
2009  
£’000
2010  
£’000
2009  
£’000
lss 86748 92959 158443 154986 
schlegel 17962 21190 53667 53444
gall thomson – – 11420 11420 
104709  114148 223531 219850 
notes to the financial statements  ⁄ continued 47
lupus capital plc
annual report  accounts 2010
10 intangible assets continued
cash flow projections are derived from financial plans approved by the board and cover a three year period they reflect 
management’s expectations of revenue growth operating cost and margin for each cgu based on past experience cash flows 
beyond the first three years have been extrapolated using revenue growth rates averaging 3 after the five year forecast period 
no further growth in revenue and profit has been assumed based on a prudent view of long term growth rates a pretax discount 
rate of 11 has been applied to cash flow projections reflecting management’s view that similar risk profiles exist for each cgu
the forecasts are most sensitive to changes considered possible by management in projected revenue growth rates in the first 
three years of the forecast period total future forecast revenue would have to be perpetually 9 lower than currently projected 
before a possible impairment charge would be indicated
certain brands and trademarks with a book value of £3230000 2009 £3330000 are considered to have an indefinite life this 
applies to those brands and trademarks which as a result of their excellent reputation with their core customer base and being 
well regarded in their market places command a significant share of the markets in which they operate
11 property plant and equipment
freehold
land and
buildings
£’000
plant
and
machinery
£’000
total
£’000
cost
at 1 january 2009 15871 66054 81925
additions 346 1798 2144
disposals – 6110 6110
exchange difference 1014 3873 4887
at 31 december 2009 15203 57869 73072
additions 99 3215 3314
disposals – 1713 1713
exchange difference 83 710 793
at 31 december 2010 15385 60081 75466
accumulated depreciation
at 1 january 2009 2486 37776 40262
charge for the year 541 6200 6741
disposals – 5938 5938
exchange difference 138 2151 2289
at 31 december 2009 2889 35887 38776
charge for the year 376 6117 6493
disposals – 1637 1637
impairment – 200 200
exchange difference 19 158 177
at 31 december 2010 3284 40725 44009
net book value
at 31 december 2010 12101 19356 31457
at 31 december 2009 12314 21982 34296
depreciation in the year of £6493000 is included in administrative costs in the income statement
the carrying value of plant and machinery held under finance leases and hire purchase contracts at 31 december 2010 was 
£15000 2009 £18000 
leased assets and assets under hire purchase contracts are pledged as security for the related finance lease and hire 
purchase liabilities 48
lupus capital plc
annual report  accounts 2010
12 inventories
2010
£’000
2009
£’000
raw materials and consumables 14726 15465
workinprogress 2499 1900
finished goods 8823 8671
26048 26036
the cost of materials charged to the income statement during the year ended 31 december 2010 was £119936000 2009 
£116149000 as at 31 december 2010 inventories are stated net of an allowance for excess obsolete or slowmoving items of 
£7449000 2009 £7370000
13 derivative financial instruments
2010 2009
assets
£’000
liabilities
£’000
assets
£’000
liabilities
£’000
interest rate swaps – 1998 – 2489
interest rate cap – – – 45
cash flow hedges – 1998 – 2534
cash flow hedges
the group uses interest rate swaps to hedge the cash flows from floating rate borrowings and these cash flows will occur within 
two years of the balance sheet date
the full fair value of the hedging derivatives are classified as a noncurrent asset or liability if the remaining maturity of the hedged 
item is more than 12 months and as a current asset or liability if the hedged item is less than 12 months fair value measurements 
are based on quoted prices in active markets for the same instrument
the notional principal amounts of the outstanding interest rate swap contracts at 31 december 2010 were £1205 million 2009 
£584 million
at 31 december 2010 the fixed interest rate was 185 2009 5025 on the us denominated swaps 1125 million 2045 
and 188 2009 nil were the interest rates fixed on two swap contracts with notional principals at 31 december 2010 of £354 
million and £124 million respectively
gains and losses recognised in the hedging reserve on interest rate swap and cap contracts as of 31 december 2010 will be 
continually released to the income statement until the repayment of the bank borrowings note 16
net investment hedges
the group uses foreign currency denominated debt to hedge the value of its foreign currency denominated net assets due to 
movements in foreign exchange rates the value of the net investment hedge was £33438000 at 31 december 2010 2009 
£28927000
14 trade and other receivables
2010
£’000
2009
£’000
trade receivables 28173 24935
other receivables 860 1475
prepayments and deferred income 3889 3440
32922 29850
all amounts are short term the carrying amounts are considered to be a reasonable approximation of fair value
all of the group’s trade and other receivables have been reviewed for impairment certain trade receivables were found to be 
impaired and a provision of £2360000 2009 £1909000 has been recorded the individually impaired receivables mainly relate 
to customers affected by the unexpected difficult economic situation 
at 31 december 2010 trade receivables of £27182000 2009 £23528000 were considered to be fully performing
notes to the financial statements  ⁄ continued 49
lupus capital plc
annual report  accounts 2010
14 trade and other receivables continued
trade receivables of £991000 2009 £1407000 were past due but not impaired as at 31 december 2010 these relate to 
customers for whom there is no recent history of default the ageing analysis of these trade receivables is as follows
2010
£’000
2009
£’000
trade receivables within normal payment terms and considered to be fully performing 25389 23528
trade receivables within normal payment terms but considered not to be fully performing 913 –
trade receivables past due date and aged up to three months from invoice date 1780 1407
trade receivables past due and aged between three and twelve months after the invoice date 91 –
trade receivables 28173 24935
movements in the group provisions for impairment of trade receivables are as follows which are included in administrative 
expenses in the income statement
2010
£’000
2009
£’000
at 1 january 1909 1586
provision for receivables impairment 974 1086
receivables written off in year 336 608
unused amounts released 207 155
other – 56
exchange differences 20 56
at 31 december 2360 1909
the carrying amounts of the group’s trade and other receivables are denominated in the following currencies
2010
£’000
2009
£’000
pounds 14394 14477
us dollars 11520 9091
euros 4242 4684
other currencies 2766 1598
32922 29850
15 trade and other payables
2010
£’000
2009
£’000
trade payables 19773 18045
other taxes and social security costs 2596 2007
accruals and accrued income 17996 16763
40365 36815
the carrying amounts are considered to be a reasonable approximation of fair value
the carrying amounts of the group’s trade and other payables are denominated in the following currencies
2010
£’000
2009
£’000
pounds 21391 18727
us dollars 13413 11360
euros 3468 3049
other currencies 2093 3679
40365 36815 50
lupus capital plc
annual report  accounts 2010
16 interestbearing loans and borrowings
2010
£’000
2009
£’000
current
bank borrowings 5163 3063
obligations under finance leases and hire purchase contracts 9 8
5172 3071
noncurrent
bank borrowings 114304 132887
obligations under finance leases and hire purchase contracts 1 10
114305 132897
minimum lease payments due under finance leases are as follows
less than one year 9 8
1 to 5 years 1 10
10 18
all the bank borrowings are secured over the majority of the building products division assets in addition the company has given 
the banks a share pledge over its shares in gall thomson
the group also has revolving credit facilities of 10015000 and £5000000 neither of which were drawn down at 31 december 2010
the carrying amounts of the group’s borrowings approximate to their fair value and are denominated in the following currencies
2010
£’000
2009
£’000
pounds 46867 57352
us dollars 72610 78616
119477 135968
there were no defaults of interest payments in the year under the terms of the loan agreements
17 provisions
property 
related
£’000
restructuring 
£’000
other
£’000
total
£’000
at 1 january 2009 13459 3202 3780 20441
provided during the year 932 361 647 1940
utilised during the year 1758 954 269 2981
released during the year 110 1711 62 1883
recategorisation – – 3100 3100
unwinding of discount 634 – – 634
exchange differences 69 167 – 236
at 31 december 2009 13088 731 7196 21015
provided during the year 142 412 607 1161
utilised during the year 1604 472 439 2515
released during the year 565 307 800 1672
unwinding of discount 559 – – 559
exchange differences 13 12 – 25
at 31 december 2010 11633 376 6564 18573
current liabilities 1293 376 1915 3584
noncurrent liabilities 10340 – 4649 14989
total 11633 376 6564 18573
the property related provisions represent the estimated net present value of future costs for lease rentals dilapidations and other 
property costs for facilities that are surplus to business requirements the leases have terms of up to seven years to expiry
other provisions comprise product liability taxation and inventory related provisions
notes to the financial statements  ⁄ continued 51
lupus capital plc
annual report  accounts 2010
18 financial instruments risk profile 
the group’s principal financial instruments comprise bank loans finance leases and hire purchase contracts and cash and 
shortterm deposits the group has various other financial instruments such as trade receivables and trade payables that arise 
directly from its operations no trading in financial instruments is undertaken
the board reviews and agrees policies for managing each financial instrument risk and they are summarised below
liquidity and credit risk
the group maintains sufficient cash and marketable securities and the availability of funding through an adequate amount of 
credit facilities management monitors rolling forecasts of the group’s liquidity on the basis of expected cash flow the group 
manages liquidity risk by the pooling of cash resources and depositing funds available for investment in approved financial 
instruments with financial institutions counterparty risk with respect to cash and cash equivalents is managed by only investing in 
banks and financial instruments with independently assessed credit ratings of at least a2 as published by standard and poors 
individual risk limits are assessed by management based on the external ratings management does not expect any losses from 
the nonperformance by these counterparties
credit risk is also attributable to the group’s exposure to trade receivables due from wholesale customers
management assesses the credit quality of customers taking into account their financial position past experience and other 
factors in order to mitigate credit risk the group utilises credit insurance in those areas of its operations where such insurance is 
available in areas where such insurance is not available management monitors the utilisation of credit limits by customers 
identified either individually or by group and incorporates this information in credit risk controls there are no significant 
concentrations of credit risk due to the diverse nature of the groups client base
trade receivables are presented in the balance sheet net of allowances for doubtful receivables estimated by the group’s 
management based on prior experience and their assessment of the current economic environment
the group’s exposure to credit risk is limited to the carrying amount of financial assets recognised at the balance sheet date as 
summarised below
2010
£’000
2009
£’000
classes of financial instruments – carrying amounts
cash and cash equivalents 27748 24955
trade and other receivables 32922 29850
at 31 december 60670 54805
management considers that all the above financial assets that are not impaired for each of the reporting dates under review are of 
good credit quality including those that are past due
during the year ended 31 december 2010 the group operated within its borrowing facilities 
the table below analyses the group’s financial liabilities which are classified as level 3 into relevant maturity groupings  
based on the remaining period at the balance sheet date to the contractual maturity date including interest payments under  
cash flow hedges
less than 
1 year 
£’000
between 
1 and 2 yrs 
£’000
between 
2 and 5 yrs 
£’000
total 
£’000
borrowings 5172 114305 – 119477
derivative financial instruments – 1998 – 1998
interest cash flows on debt and derivatives settled net 6040 2905 8945
trade and other payables 40365 1559 – 41924
at 31 december 2010 51577 120767 – 172344
borrowings 3071 6755 126142 135968
derivative financial instruments 2534 – – 2534
interest cash flows on debt and derivatives settled net 9071 8945 4278 2534
trade and other payables 36815 782 – 37597
at 31 december 2009 51491 16482 130420 178633 52
lupus capital plc
annual report  accounts 2010
18 financial instruments risk profile continued
interest rate risk
the group has an overdraft facility but this was not used for borrowing purposes the interest rate profile of the group’s 
borrowings as at 31 december 2010 was as follows
floating rate 
liabilities 
£’000
fixed rate 
liabilities 
£’000
total 
£’000
pounds 46867 – 46867
us dollars 72600 10 72610
at 31 december 2010 119467 10 119477
pounds 57352 – 57352
us dollars 78598 18 78616
at 31 december 2009 135950 18 135968
the interest rate on the floating rate bank loans are linked to libor 
the group took out a swap agreement which was effective from 12 june 2007 and covered the period until 30 september 2010 
and the economic effect was to partially fix the interest rate for the borrowings for the lssd acquisition 
the group entered into an interest rate cap transaction which was effective from 12 june 2007 and covered the period until 
30 september 2010 the economic effect was to cap the rate at which interest is payable on 50 of the 240 million loan facility 
at 55 
on 10 february 2010 jasper acquisition holdings limited entered into new interest swap agreements with the economic effect 
of fixing the usd denominated debt related to the lss acquisition in excess of the existing swap agreement at an interest rate of 
185 per annum the gbp denominated debt related to the lss acquisition was fixed at an interest rate of 2045 all the swap 
agreements cover the period from 30 march 2010 to 02 july 2012 
on 9 april 2010 a gbp swap agreement was entered into by schlegel acquisition holdings limited with the economic effect of 
fixing the debt related to the schlegel acquisition at an interest rate of 188 the swap agreement covers the period from 
30 june 2010 to 02 july 2012
floating rate 
borrowings 
£’000
covered 
by interest 
rate swaps 
£’000
swap 
fixed 
rate 

at 31 december 2010
pounds 47914 47800 2006
us dollars 74483 72717 1850
122397 120517
at 31 december 2009
pounds – – –
us dollars 81913 58388 5025
81913 58388
  these amounts exclude capitalised loan fees
interest rate risk of financial assets
the board periodically reviews any exposure the group may have to interest rate fluctuations the weighted average interest rate 
received on deposited funds was 215 during the year 2009 198
foreign currency risk
the group operates internationally and is exposed to foreign exchange risk arising from various currency exposures primarily 
with respect to the us dollar the euro the rmb and the australian dollar foreign exchange risk arises from future commercial 
and financing transactions recognised assets and liabilities denominated in a currency that is not the group’s presentational 
currency and net investments in overseas entities
the group has a number of overseas subsidiaries whose net assets are subject to currency translation risk the group borrows 
in local currencies as appropriate to minimise the impact of this risk on the balance sheet
overseas subsidiaries are responsible for managing transactional foreign exchange risk arising from future commercial and 
financing transactions and recognised assets and liabilities in currencies other than their functional currency usually by using 
forward currency contracts
notes to the financial statements  ⁄ continued 53
lupus capital plc
annual report  accounts 2010
18 financial instruments risk profile continued
2010 2009
closing rates
us dollars 15471 15928
euros 11675 11113
average rates
us dollars 15463 15659
euros 11661 11230
foreign currency exchange rate sensitivity
the group receives approximately 44 of its revenues and incurs approximately 43 of its costs in usd the group is therefore 
sensitive to movements in the usd against gbp each five cent movement in the usd to gbp exchange rate has circa £04 million 
impact on operating profits offsetting this will be reductions to usd interest and us tax liabilities this analysis assumes all other 
variables including interest rates remain constant
 
the group receives approximately 11 of its revenues and incurs approximately 10 of its costs in euros each five cent 
movement in the euro to gbp exchange rate has a circa £02 million impact on operating profits offsetting this will be reductions 
to euro interest and euro tax liabilities this analysis assumes all other variables including interest rates remain constant
additionally the group incurs approximately 7 of its costs in chinese renminbi “rmb” each rmb 040 movement in the rmb 
to gbp exchange rate has a circa £06 million impact on operating profits 
the impact of movements in other exchange rates is immaterial
foreign currency financial assets and liabilities translated into sterling at the closing rate are as follows 
usd 
£’000
euros 
£’000
other 
£’000
total 
£’000
short term exposure
financial assets 18818 6323 3445 28586
financial liabilities 16031 3468 2093 21592
at 31 december 2010 2787 2855 1352 6994
long term exposure
financial assets – – – –
financial liabilities 75322 153 30 75505
at 31 december 2010 75322 153 30 75505
usd 
£’000
euros 
£’000
other 
£’000
total 
£’000
short term exposure
financial assets 15768 7381 2411 25560
financial liabilities 15159 3049 3679 21887
at 31 december 2009 609 4332 1268 3673
long term exposure
financial assets – – – –
financial liabilities 80717 205 – 80922
at 31 december 2009 80717 205 – 80922
19 pensions and other postemployment benefit plans
191 defined contribution pension schemes
the group operates a number of defined contribution pension schemes the assets of which are held externally to the group in 
separate trustee administered funds the costs of the group’s defined contribution pension schemes are charged to the income 
statement in the period in which they fall due the group had unpaid pension contributions of £38000 2009 £40000 included 
within employee benefit liabilities
192 defined benefit pension and post retirement benefit schemes
the group’s principal defined benefit pension scheme and postretirement healthcare scheme is operated in the usa an actuarial 
valuation was last performed as at 31 december 2010 when revalued scheme assets are included at market value and scheme 
liabilities are measured on an actuarial basis using the net periodic benefit cost these liabilities are discounted at the current rate 
of return on a high quality corporate bond of equivalent currency and term surpluses are only included to the extent that they are 
recoverable through reduced contributions in the future or through refunds from the schemes  54
lupus capital plc
annual report  accounts 2010
19 pensions and other postemployment benefit plans continued
the current service cost and any past service costs are included in the income statement within operating expenses and the 
expected return on the schemes’ assets net of the impact of the unwinding of the discount on scheme liabilities is included within 
other finance income and costs actuarial gains and losses including differences between the expected and actual return on 
scheme assets are recognised net of the related deferred tax in the consolidated statement of comprehensive income
the pension scheme is closed to new entrants as a result the service costs to the group will rise in future years the expected 
level of contributions to the defined benefit scheme and post retirement healthcare scheme in the year to december 2011 is 
£1266000 2010 £821000
other defined benefit pension schemes had net liabilities of £230000 2009 £152000 
amounts recognised in the income statement in respect of the defined benefit pension and post retirement benefit schemes
2010 
£’000
2009 
£’000
included in operating profit
current service cost 255 216
2010 
£’000
2009 
£’000
included in finance income and costs
interest cost 1009 995
expected return on plan assets 757 640
252 355
the major assumptions used by the actuary were
31 december 
2010
31 december 
2009
rate of increase in salaries na na
long term rate of inflation 3 3
rate of increase in pensions in payment 00 00
discount rate 55 575
health care cost trend
1
9050 82550
1  the level of healthcare contributions are capped and adopting a higher trend rate does not materially affect the liability
the mortality assumptions employed in determining the present value of scheme liabilities under ias 19 are in accordance with the 
underlying funding valuations and represented actuarial best practice in the relevant jurisdictions taking account of mortality 
experience and industry circumstances
amounts recognised in the consolidated statement of comprehensive income in respect of the defined benefit pension and post 
retirement benefit schemes 
2010 
£’000
2009 
£’000
actual return on plan assets 1380 1713
expected return on plan assets 757 640
experience gainloss on assets 623 1073
experience gainloss on liabilities 481 2682
net loss before exchange 142 1609
foreign exchange differences 219 683
amounts recognised during the year 77 926
notes to the financial statements  ⁄ continued 55
lupus capital plc
annual report  accounts 2010
19 pensions and other postemployment benefit plans continued
changes in the present value of the benefit obligation were as follows
change in defined benefit obligation
2010 
£’000
2009 
£’000
defined benefit obligation at beginning of year 17440 15822
current service cost 255 216
interest cost 1009 995
actuarial loss 481 2682
benefits paid 834 784
foreign exchange 515 1491
defined benefit obligation at end of year 18866 17440
changes in the fair value of plan assets were as follows
change in plan assets
2010 
£’000
2009 
£’000
fair value of plan assets at beginning of year 9942 8506
actual return on plan assets 1380 1713
employer contributions 841 1317
plan participant contributions 67 –
benefits paid 901 784
foreign exchange 293 810
fair value of plan assets at end of year 11622 9942
the fair value of plan assets by asset category was as follows
plan assets by category
2010 
£’000
2009 
£’000
equity securities 7414 6535
debt securities 3473 2864
real estate 734 543
other 1 –
total 11622 9942
the cumulative actuarial loss recognised in the consolidated statement of comprehensive income since acquiring the pension 
obligations in april 2007 is as follows
£000
recognised in 2007 financial year 105
recognised in 2008 financial year 3669
recognised in 2009 financial year 926
recognised in 2010 financial year 77
cumulative actuarial loss recognised in the consolidated statement of comprehensive income 4777
history of scheme assets liabilities and actuarial gains and losses
2010 
£’000
2009 
£’000
2008 
£’000
2007 
£’000
2006 
£’000
fair value of plan assets at the end of the year 11555 9942 8506 7245 7277
defined benefit obligation at end of year 18866 17440 15822 10503 10552
deficit at the end of the year 7311 7498 7316 3258 3275
actual return less expected return on scheme assets 623 1073 2392 335 3
 of scheme assets 54 108 281 46 00
experience lossgain arising on scheme obligations present value 481 2682 799 182 65
 of scheme obligations present value 25 154 50 17 06 56
lupus capital plc
annual report  accounts 2010
20 share capital
number of 
shares 
’000
ordinary 
shares of 
5p each 
£’000
31 december 2009 and 31 december 2010 137287 6864
the total authorised number of ordinary shares is 180000000 2009 180000000 with a par value of 5p per share 2009 5p per 
share all issued shares are fully paid 7446683 ordinary shares 2009 7446683 are held by the company as treasury shares
sharebased payments
in 2010 the group operated two share schemes the 2008 share option scheme and the ltip
for the purposes of assessing the income statement change under ifrs 2 the options awarded under the 2008 share option 
scheme were valued using a black scholes model the nil cost options awarded under the ltip were valued using a probability 
model to predict eps levels the charge to the income statement in 2010 was £63000 2009 £23000
2008 share option scheme
share options were granted under the 2008 share option scheme to executive directors and managers in july 2008 the remuneration 
committee has resolved that no further options will be granted under the 2008 share option scheme the exercise price was the market 
price at the close of business on the day preceding the date of grant options are exercisable three years after the date of grant provided 
the participant remains an employee of the group and performance targets for earnings per share growth are met 
the fair value per option granted under the 2008 share option scheme and the assumptions used in the calculation of the 
sharebased payment charge are as follows
2008 share option scheme
valuation model black scholes
date of grant 25 july 2008
number granted 6475000
share price at date of award 38 pence
fair value pence 8 pence
exercise price pence 38 pence
expected volatility per cent pa 35
expected dividends per cent pa 15
vesting period 3 years
vesting conditions continuous service and cumulative underlying eps in 2010 in range of 
1352 to 1458 pence
as the vesting conditions for the 2008 share option scheme have not been met all outstanding options will lapse upon the 
signing of these accounts
movements in the number of share options outstanding and their related weighted average exercise price “waep” are as follows
2010 2009
number of 
options 
’000 waep
number of 
options 
’000 waep
at 1 january 4400 3800p 6475 3800p
lapsed – – 2075 3800p
31 december 4400 3800p 4400 3800p
ltip
conditional annual awards of shares are granted under the ltip to certain executive directors and senior managers at the 
discretion of the remuneration committee provided the participant remains an employee of the group and the performance 
conditions are met awards will vest three years after the date of grant at no cost to the employee the percentage of shares  
that will actually vest is dependent upon the group’s earnings per share growth over a three year measurement period ending 
31 december 2013 further information on the ltip and the performance conditions is given in the remuneration report
notes to the financial statements  ⁄ continued 57
lupus capital plc
annual report  accounts 2010
20 share capital continued
the fair value of the awards granted under the ltip and the assumptions used in the calculation of the sharebased payment 
charge are as follows
ltip
valuation model probability model to predict eps levels
date of grant 11 december 2010
number granted 1413000
share price at date of award 107 pence
fair value pence 34 pence
exercise price pence nil pence
expected life of award 3 years
vesting conditions continuous service and cumulative underlying eps over 3 years 2011 to 
2013 in range of 38 to 47 pence
movements in the number of outstanding conditional awards of shares are as follows
2010 2009
number of 
shares 
’000
number of 
shares 
’000
at 1 january – –
granted 1413 –
31 december 1413 –
21 dividends
no dividends were declared or paid in 2010 2009 nil a dividend of 20 pence per ordinary share has been proposed by the 
directors for approval at the forthcoming agm
22 adjustments to cash flows from operating activities
the following noncash and financing adjustments have been made to profitloss before tax for the year to arrive at operating 
cash flow
2010 
£’000
2009 
£’000
net finance costs 11996 12639
depreciation 6493 6741
amortisation 11749 11553
intangible and fixed assets written off 76 479
non cash adjustments 289 1404
share based payments 63 23
30666 32839
23 contingent liabilities
2010 
£’000
2009 
£’000
financial guarantees 983 1253
performance bonds 9 9
992 1262
the group has guarantees amounting to £983000 2009 £1253000 these guarantees principally relate to letters of credit 
provided by banks in respect of workmens‘ compensation claims on which no losses are anticipated these guarantees are 
defined as financial guarantees under ias39 and their fair value at 31 december 2010 was £nil 2009 £nil 58
lupus capital plc
annual report  accounts 2010
24 financial commitments
the group has entered into commercial leases on certain properties there are no restrictions placed upon the lessee by entering 
into these leases
the present value of future minimum rentals payable under noncancellable operating leases are as follows
land and buildings
2010 
£’000
2009 
£’000
not later than one year 3422 3723
after one year but more than five years 12717 9709
over five years 7106 7959
other
2010 
£’000
2009 
£’000
not later than one year 410 554
after one year but more than five years 537 588
over five years 62 2
25 investments in subsidiaries
details of the principal subsidiaries of the group all of which are wholly owned are as follows
country of incorporation nature of business
gall thomson environmental limited uk oil services
klaw products limited uk industrial couplings
octroi group limited uk investment company
lupus capital management limited uk management services
schlegel acquisition holdings limited uk holding company
schlegel uk 2006 limited uk building products
schlegel system inc usa building products
schlegel australia pty limited australia building products
schlegel gmbh germany building products
schlegel belgium bvba belgium building products
schlegel srl  italy building products
schlegel taliana sl  spain building products
jasper acquisition holdings limited uk holding company
jasper acquisition limited uk holding company
amesbury acquisition holdings no 2 inc usa holding company
amesbury industries inc usa building products
amesbury finance holdings llc usa holding company
lupus investments unlimited company uk investment company
amesbury door hardware inc sd usa building products
amesbury group inc usa holding company
amesbury group plastic profiles inc usa building products
bandlock corporation inc usa building products
balance systems inc usa building products
fastek products inc usa building products
grouphomesafe limited uk holding company
balance uk limited uk building products
era products limited uk building products
ews manufacturing limited uk building products
intron limited uk building products
lsh uk limited uk building products
linear limited uk building products
lindman group limited uk building products
securidor holdings limited uk building products
ventrolla limited uk building products
 held by a subsidiary
notes to the financial statements  ⁄ continued 59
lupus capital plc
annual report  accounts 2010
26 related party transactions
directors
during the financial year no contracts of significance other than those disclosed within directors’ remuneration were entered into 
by the group or any of its subsidiaries in which the directors had a material interest
key management compensation
compensation for directors who have the sole responsibility for planning directing and controlling the group is disclosed in 
note 6
transactions between the company and its subsidiaries which are related parties are eliminated on consolidation 
27 post balance sheet events
there have been no post balance sheet events which the group must disclose 60
lupus capital plc
annual report  accounts 2010
we have audited the parent company financial statements of lupus capital plc for the year ended 31 december 2010 which 
comprise the parent company balance sheet and the related notes the financial reporting framework that has been applied 
in their preparation 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 directors’ responsibilities statement the directors are responsible for the preparation of the parent 
company financial statements and for being satisfied that they give a true and fair view our responsibility is to audit and express 
an opinion on the parent company 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
a description of the scope of an audit of financial statements is provided on the apb’s website at  
wwwfrcorgukapbscopeprivatecfm
opinion on financial statements
in our opinion the parent company financial statements
give a true and fair view of the state of the company’s affairs as at 31 december 2010 •	
have been properly prepared in accordance with united kingdom generally accepted accounting practice and •	
have been prepared in accordance with the requirements of the companies act 2006 •	
opinion on other matter 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 parent company 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 •	
other matter
we have reported separately on the group financial statements of lupus capital plc for the year ended 31 december 2010 
charles huttonpotts bsc fca
senior statutory auditor
for and on behalf of grant thornton uk llp
statutory auditor chartered accountants
london
23 march 2011
independent auditor’s report to the members of lupus capital plc ⁄ 61
lupus capital plc
annual report  accounts 2010
company balance sheet ⁄
as at 31 december 2010
note
2010 
£’000
2009 
£’000
fixed assets
investments 4 192453 185153
192453 185153
current assets
debtors 6 7048 7048
cash at bank and in hand 19889 18398
26937 25446
liabilities
creditors amounts falling due within one year 7 5288 5237
net current assets 21649 20209
total assets less current liabilities 214102 205362
creditors amounts falling due after one year 8 7876 7876
net assets 206226 197486
equity
shareholders’ equity
called up share capital 11 6864 6864
share premium 11 101 101
other reserves 11 8920 8920
treasury reserve 11 6764 6764
retained earnings 11 197105 188365
total equity 206226 197486
the financial statements were approved by the board on 23 march 2011
louis eperjesi 
chief executive office
james brotherton
chief financial officer 62
lupus capital plc
annual report  accounts 2010
1 accounting policies
going concern
the financial statements have been prepared on the going concern basis which assumes that the group will have sufficient funds 
to continue in operational existence for the foreseeable future
the group’s debt facilities expire in july 2012 and the group expects that it will be able to meet its debt facility interest and 
repayment obligations in 2011 and that trading will be at least flat in comparison to 2010 accordingly the company has assumed 
that the going concern basis of preparation of these financial statements is appropriate 
accounting convention
the separate financial statements of the company are presented as required by the companies act 2006 as permitted by that 
act the financial statements have been prepared in accordance with applicable uk accounting standards uk gaap 
all other accounting policies remain unchanged from those used in the last annual accounts 
investments 
investments in subsidiaries are stated at cost less any permanent diminution of value
financial instruments
financial assets and liabilities are recognised on the company’s balance sheet when the company becomes a party to the 
contractual provisions of the instrument
trade debtors are stated at their nominal value as reduced by appropriate allowances for estimated recoverable amounts
trade creditors are stated at their nominal amount
borrowings
interest bearing loans and overdrafts are recorded at the proceeds received all borrowing costs are expensed as incurred on 
accruals basis to the company profit and loss account using the effective interest rate method
sharebased payments 
the company has applied the requirements of frs 20 sharebased payments the company issues equitysettled sharebased 
payments to certain employees equitysettled sharebased payments are measured at fair value at the date of grant the fair 
value determined at the grant date of the equitysettled sharebased payments is expensed on a straightline basis over the 
vesting period based on the group’s estimate of shares that will eventually vest
fair value is measured by use of the black scholes model the expected life used in the model has been adjusted based on 
management’s best estimate for the effects of nontransferability exercise restrictions and behavioural considerations 
2 profit attributable to the shareholders of the company
the company is an investment holding company it receives dividend income from subsidiaries and bank interest it pays loan 
interest to a subsidiary almost all administrative expenses are paid by the company’s subsidiary lupus capital management 
limited including the whole amount of relevant auditor’s remuneration and operating lease costs
as permitted by section 408 of the companies act 2006 the company’s profit and loss account has not been included in these 
accounts the profit on ordinary activities attributable to shareholders of the company dealt with in these accounts was 
£8677000 2009 £4920000
3 employees
other than the directors there were no employees of the company during the year 2009 nil directors’ emoluments are set out 
in the directors’ remuneration report in the group’s accounts 
notes to the company financial statements ⁄ 63
lupus capital plc
annual report  accounts 2010
4 fixed asset investments
£’000
cost
at 1 january 2009 185762
capital injection 2
at 31 december 2009 185764
subscription of shares 7300
at 31 december 2010 193064
impairment
at 1 january and 31 december 2009 611
charge for the year –
at 31 december 2010 611
net book value
at 31 december 2010 192453
at 31 december 2009 185153
the subscription of shares relates to subscription of shares in lupus capital management limited and jasper acquisition 
holdings limited of £5000000 and £2300000 respectively
5 investments in subsidiaries
details of the principal subsidiaries of the company all of which are wholly owned are as follows
country of incorporation nature of business
gall thomson environmental limited uk oil services
octroi group limited uk investment company
lupus capital management limited uk management services
schlegel acquisition holdings limited uk holding company
jasper acquisition holdings limited uk holding company
6 debtors
2010 
£’000
2009 
£’000
amount due from subsidiary undertaking 7048 7048
the amounts due from subsidiary undertakings are repayable on demand but are unlikely to be repaid within one year
7 creditors amounts falling due within one year
2010 
£’000
2009 
£’000
trade creditors – –
amounts owed to group undertakings 4826 4809
corporation tax 462 428
5288 5237
8 creditors amounts falling due after more than one year
2010 
£’000
2009 
£’000
loan notes owed to group undertakings 7876 7876
the loan note is between the company and octroi group limited a subsidiary and interest is charged at a fixed rate of 2 per 
cent per annum payable half yearly in arrears  64
lupus capital plc
annual report  accounts 2010
9 borrowing
the group overdraft facility of £100000 is available to the company it falls due for renewal annually in october of each year 
10 share capital
the share capital of the company is as set out in note 20 of the group accounts
11 reconciliation of movements in equity
share 
capital 
£’000
share 
premium 
account 
£’000
other 
reserves 
£’000
treasury 
reserve 
£’000
profit  
loss 
account 
£’000
total 
£’000
at 1 january 2009 6864 101 8920 6764 183422 192543
shares issued net of costs – – – – – –
profit for the year – – – – 4920 4920
share based payments – – – – 23 23
at 31 december 2009 6864 101 8920 6764 188365 197486
shares issued net of costs – – – – – –
profit for the year – – – – 8677 8677
share based payments – – – – 63 63
at 31 december 2010 6864 101 8920 6764 197105 206226
details of share based payments are given in note 20 of the group accounts
12 financial commitments
at 31 december 2010 the company had future annual lease commitments under noncancellable operating leases as stated 
below these commitments are met on the company’s behalf by lupus capital management limited
land and buildings
2010 
£’000
2009 
£’000
expiry date
within one year 14 32
13 related party transactions
the only transaction between the company and its subsidiaries which are related parties was the payment of interest on the loan 
note mentioned in note 8 the total interest payable for the year was £158000
notes to the company financial statements  ⁄ continued 65
lupus capital plc
annual report  accounts 2010
advisers ⁄
secretary
cavendish administration limited
company number
2806007
registered office
crusader house
145157 st john street
london ec1v 4ru
auditors
grant thornton uk llp
grant thornton house
melton street
london nw1 2ep
definitions ⁄
where appropriate “underlying” is defined as before amortisation of intangible assets deferred tax on amortisation of intangible •	
assets exceptional items unwinding of discount on provisions amortisation of borrowing costs and the associated tax effect
“underlying net debt“ is defined as interest bearing loans and borrowings net of cash and cash equivalents plus unamortised •	
borrowing costs added back
“operating cash conversion” is defined as net cash inflow from operating activities before income tax paid and after payments •	
to acquire property plant and equipment divided by underlying operating profit
“dropthrough margin” is defined as incremental underlying operating profit as a percentage of incremental sales •	
roundings ⁄
 
percentage increasedecrease numbers have been calculated using figures rounded to the nearest thousand from the financial •	
statements which may lead to small differences in some figures and percentages quoted
exchange rates ⁄
2010 2009
closing rates
us dollars 15471 15928
euros 11675 11113
average rates
us dollars 15463 15659
euros 11661 11230
registrar
capita registrars limited
the registry
34 beckenham road
beckenham
kent br3 4tu
nominated adviser and broker
collins stewart europe limited
88 wood street
london ec1v 7qr
website
wwwlupuscapitalcouk 66
lupus capital plc
annual report  accounts 2010
notice of annual general meeting ⁄
notice is hereby given that the annual general meeting of lupus capital plc company number 2806007 will be held at the offices 
of college hill the registry royal mint court london ec3n 4qn on 27 may 2011 at 1030 am for the following purposes
ordinary resolutions
to consider and if thought fit approve the following ordinary resolutions
1 to receive and adopt the audited financial statements for the financial year ended 31 december 2010 together with the reports 
of the directors and auditors
2 to declare a final dividend of 200p per ordinary share for the financial year ended 31 december 2010
3 to reelect mr pike
4 to reelect mr eperjesi
5 to elect mr brotherton who offers himself for election as a director having been appointed by the board since the last  
annual general meeting
6 to reelect mr tench
7 to reelect mr towers
8 to reappoint grant thornton uk llp as independent auditors of the company to hold office until the conclusion of the next 
annual general meeting
9 to authorise the directors to set the remuneration of the independent auditors
10 to approve the directors’ remuneration report for the financial year ended 31 december 2010
11 that the directors be and are hereby generally and unconditionally authorised in substitution for all existing authorities to 
exercise all powers of the company to allot shares in the company and to grant rights to subscribe for or convert any security 
into shares in the company up to an aggregate nominal amount of £216401330 being onethird of the issued share capital 
excluding treasury shares of the company as at the date of the notice of this meeting which authority shall expire on 1 july 
2016 unless previously revoked or varied by the company in general meeting save that the company may before such expiry 
make an offer or agreement which would or might require shares to be allotted or rights to subscribe for or convert securities 
into shares to be granted after the authority ends and the directors may allot shares or grant rights to subscribe for or convert 
securities into shares under any such offer or agreement as if this authority had not ended
special resolutions
to consider and if thought fit approve the following special resolutions
12 that the directors be and are hereby empowered pursuant to section 570 of the companies act 2006 the “act” to allot 
equity securities within the meaning of section 560 of the act for cash andor sell equity securities held as treasury shares 
pursuant to section 570 of the act as if section 5611 of the act did not apply to any such allotment provided that this power 
shall be limited to
a the allotment of equity securities in connection with a rights issue open offer or any other preemptive offer in favour of 
ordinary shareholders excluding any shareholder holding shares as treasury shares and in favour of holders excluding any 
holder holding shares as treasury shares of any other class of equity security in accordance with the rights attached to 
such class where the equity securities respectively attributable to the interests of such persons on a fixed record date are 
proportionate as nearly may be to the respective numbers of equity securities held by them or are otherwise allotted in 
accordance with the rights attaching to such equity securities subject in either case to such exclusions or other 
arrangements as the directors may deem necessary or expedient to deal with fractional entitlements or legal or practical 
problems arising in any overseas territory the requirements of any regulatory body or stock exchange or any other matter 
whatsoever and
b the allotment of otherwise than pursuant to 12a above of equity securities andor sale of equity securities held as 
treasury shares up to an aggregate nominal value of £34321870 being 5 of the issued share capital as at the date of the 
notice of this meeting 
 and shall expire on the close of the annual general meeting of the company in 2012 save that the company may make an 
offer or agreement before such expiry which would or might require equity securities to be allotted after such expiry and  
the directors may allot equity securities in pursuance of such an offer or agreement as if the power conferred thereby had  
not expired  67
lupus capital plc
annual report  accounts 2010
13 that the company be generally and unconditionally authorised to make market purchases within the meaning of section 
6934 of the act of ordinary shares of 5 pence nominal value of the company provided that
a the maximum number of ordinary shares of 5 pence nominal value hereby authorised to be purchased is 19463135  
being 1499 of the company’s voting ordinary shares in issue at the date of this meeting
b the minimum price exclusive of any expenses which may be paid for an ordinary share excluding treasury shares is  
5 pence
c the maximum price exclusive of any expenses which may be paid for any such share is an amount equal to 105 of the 
average of the middle market quotations for an ordinary share taken from the london stock exchange daily official list for 
the five business days immediately preceding the date on which such share is contracted to be purchased
d any ordinary shares purchased pursuant to this authority shall be cancelled or if the directors so determine held as 
treasury shares
e the authority hereby confirmed shall expire on the close of the annual general meeting in 2012 and
f the company may make a contract for the purchase of ordinary shares under this authority before the expiry of this 
authority which would or might be executed wholly or partly after the expiry of such authority and may make purchases of 
ordinary shares in pursuance of such a contract as if such authority had not expired
by order of the board
cavendish administration limited   registered office
company secretary    145157 st john street
23 march 2011      london ec1v 4ru
     
notes 
website address
1 information regarding the meeting including the information required by section 311a of the companies act 2006 is available from wwwlupuscapitalcouk
entitlement to attend and vote
2 only those holders of ordinary shares registered on the company’s register of members at 600 pm on 25 may 2011 or if this meeting is adjourned at 600 pm on the day 
two days prior to the adjourned meeting shall be entitled to attend and vote at the meeting
appointment of proxies
3 members entitled to attend speak and vote at the meeting in accordance with note 2 above are entitled to appoint one or more proxies to attend speak and vote in their 
place if you wish to appoint a proxy please use the form of proxy enclosed with this document or follow the instructions at note 7 below if you wish to appoint a proxy 
through the crest electronic proxy appointment service in the case of joint members only one need sign the form of proxy the vote of the senior joint member will be 
accepted to the exclusion of the votes of the other joint members for this purpose seniority will be determined by the order in which the names of the members appear in 
the register of members in respect of the joint shareholding the completion and return of the form of proxy will not stop you attending and voting in person at the meeting 
should you wish to do so a proxy need not be a member of the company you may appoint more than one proxy provided each proxy is appointed to exercise the rights 
attached to a different share or shares held by you if you choose to appoint multiple proxies use a separate copy of this form which you may photocopy for each proxy and 
indicate after the proxy’s name the number of shares in relation to which they are authorised to act which in aggregate should not exceed the number of ordinary shares 
held by you please also indicate if the proxy instruction is one of multiple instructions being given all forms must be signed and returned in the same envelope
4 you can appoint the chairman of the meeting or any other person as your proxy if you wish to appoint someone other than the chairman cross out the words “the 
chairman of the meeting” on the form of proxy and insert the full name of your appointee
5 you can instruct your proxy how to vote on each resolution by ticking the “for” and “against” boxes as appropriate or entering the number of shares which you are entitled to 
vote if you wish to abstain from voting on any resolution please tick the box which is marked “vote withheld” it should be noted that a vote withheld is not a vote in law and 
will not be counted in the calculation of the proportion of votes “for” and “against” a resolution if you do not indicate on the form of proxy how your proxy should vote  
heshe can exercise hisher discretion as to whether and if how so how heshe votes on each resolution as heshe will do in respect of any other business including 
amendments to resolutions which may properly be conducted at the meeting
 a company incorporated in england and wales or northern ireland should execute the form of proxy under its common seal or otherwise in accordance with section 44 of 
the companies act 2006 or by signature on its behalf by a duly authorised officer or attorney whose power of attorney or other authority should be enclosed with the form  
of proxy
appointment of proxy using hard copy form
6 the form of proxy and any power of attorney or a notarially certified copy or office copy thereof under which it is executed must be received by capita registrars proxy 
department the registry 34 beckenham road beckenham kent br3 4tu at 1030 am on 25 may 2011 in respect of the meeting any forms of proxy received before 
such time will be deemed to have been received at such time in the case of an adjournment the form of proxy must be received by capita registrars no later than 48 hours 
before the rescheduled meeting
 on completing the form of proxy sign it and return it to capita registrars at the address shown on the reverse of the form of proxy as postage has been prepaid no stamp 
is required you may if you prefer return the form of proxy in a sealed envelope to the address shown above
appointment of proxies through crest
7 crest members who wish to appoint a proxy or proxies through the crest electronic proxy appointment service may do so for the meeting to be held on the above date 
and any adjournments thereof by using the procedures described in the crest manual crest personal members or other crest sponsored members and those 
crest members who have appointed a voting service providers should refer to their crest sponsor or voting service providers who will be able to take the appropriate 
action on their behalf 68
lupus capital plc
annual report  accounts 2010
 in order for a proxy appointment or instruction made using the crest service to be valid the appropriate crest message a “crest proxy instruction” must be properly 
authenticated in accordance with euroclear uk  ireland limited’s specifications and must contain the information required for such instructions as described in the crest 
manual the message regardless of whether it constitutes the appointment of a proxy or an amendment to the instruction given to a previously appointed proxy must in 
order to be valid be transmitted so as to be received by the company’s agent id ra10 by the latest times for receipt of proxy appointments specified in the notice of 
meeting for this purpose the time of receipt will be taken to be the time as determined by the timestamp applied to the message by the crest applications host from 
which the company’s agent is able to retrieve the message by enquiry to crest in the manner prescribed by crest after this time any change of instructions to proxies 
appointee through crest should be communicated to the appointee through other means
 crest members and where applicable their crest sponsors or voting service providers should note that euroclear uk  ireland limited does not make available special 
procedures in crest for any particular messages normal system timings and limitations will therefore apply in relation to the input of crest proxy instructions it is the 
responsibility of the crest member concerned to take or if the crest member is a crest personal member or sponsored member or has appointed a voting service 
providers to procure that his crest sponsor or voting service providers takes such action as shall be necessary to ensure that a message is transmitted by means of the 
crest system by any particular time in this connection crest members and where applicable their crest sponsors or voting service providers are referred in 
particular to those sections of the crest manual concerning practical limitations of the crest system and timings
 the company may treat as invalid a crest proxy instruction in the circumstances set out in regulation 355a of the uncertificated securities regulations 2001
 all messages relating to the appointment of a proxy or an instruction to a previously appointed proxy which are to be transmitted through crest must be lodged at  
1030 am on 25 may 2011 in respect of the meeting any such messages received before such time will be deemed to have been received at such time in the case of an 
adjournment all messages must be lodged with capita registrars no later than 48 hours before the rescheduled meeting
termination of proxy appointments
8 in order to revoke a proxy instruction you will need to inform the company please send a signed hard copy notice clearly stating your intention to revoke your proxy 
appointment to capita registrars proxy department the registry 34 beckenham road beckenham kent br3 4tu
 in the case of a member which is a company the revocation notice must be executed under its common seal or otherwise in accordance with section 44 of the companies 
act 2006 or by signature on its behalf by an officer or attorney whose power of attorney or other authority should be included with the revocation notice
 if you attempt to revoke your proxy appointment but the revocation is received after the time specified in note 2 above then subject to the paragraph directly below your 
proxy will remain valid
 if you submit more than one valid proxy appointment in respect of the same ordinary shares the appointment received last before the latest time for receipt of proxies will 
take precedence
 completion of a form of proxy will not preclude a member from attending and voting in person if you have appointed a proxy and attend the meeting in person your proxy 
appointment will be automatically terminated
nominated persons
9 if you are a person who has been nominated under section 146 of the companies act 2006 to enjoy information rights
•	 y o u	m a y	h a v e	a	r i g h t	u n d e r	a n	a g r e e m e n t	b e t w e e n	y o u	a n d	t h e	m e m b e r	o f	t h e	c o m p a n y	w h o	h a s	n o m i n a t e d	y o u	t o	h a v e	i n f o r m a t i o n	r i g h t s	 r e l e v a n t	m e m b e r 	t o	b e	
appointed or to have someone else appointed as a proxy for the meeting
•	 i f	y o u	e i t h e r	d o	n o t	h a v e	s u c h	a	r i g h t	o r	i f	y o u	h a v e	s u c h	a	r i g h t	b u t	d o	n o t	w i s h	t o	e x e r c i s e	i t 	y o u	m a y	h a v e	a	r i g h t	u n d e r	a n	a g r e e m e n t	b e t w e e n	y o u	a n d	t h e	r e l e v a n t	
member to give instructions to the relevant member as to the exercise of voting rights
•	 y o u r	m a i n	p o i n t	o f	c o n t a c t	i n	t e r m s	o f	y o u r	i n v e s t m e n t	i n	t h e	c o m p a n y	r e m a i n s	t h e	r e l e v a n t	m e m b e r	 o r 	p e r h a p s 	y o u r	c u s t o d i a n	o r	b r o k e r 	a n d	y o u	s h o u l d	c o n t i n u e 	t o	
contact them and not the company regarding any changes or queries relating to your personal details and your interest in the company including any administrative 
matters the only exception to this is where the company expressly requests a response from you
 if you are not a member of the company but you have been nominated by a member of the company to enjoy information rights you do not have a right to appoint any 
proxies under the procedures set out in the notes to the form of proxy
questions at the meeting
10 under section 319a of the companies act 2006 the company must answer any question you ask relating to the business being dealt with at the meeting unless
•	 a n s w e r i n g	t h e	q u e s t i o n	w o u l d	i n t e r f e r e	u n d u l y	w i t h	t h e	p r e p a r a t i o n	f o r	t h e	m e e t i n g	o r	i n v o l v e	t h e	d i s c l o s u r e	o f	c o n fi d e n t i a l	i n f o r m a t i o n 
•	 t h e	a n s w e r	h a s	a l r e a d y	b e e n	g i v e n	o n	a	w e b s i t e	i n	t h e	f o r m	o f	a n	a n s w e r	t o	a	q u e s t i o n 	o r
•	 i t	i s	u n d e s i r a b l e	i n	t h e	i n t e r e s t s	o f	t h e	c o m p a n y	o r	t h e	g o o d	o r d e r	o f	t h e	m e e t i n g	t h a t	t h e	q u e s t i o n	b e	a n s w e r e d 
issued shares and total voting rights
11 the total number of shares in issue in the company is 137287481 ordinary shares of 5p each of these 7446683 are held in treasury therefore the total number of ordinary 
shares with voting rights is 129840798 on a vote by a show of hands every holder of ordinary shares who being an individual is present by a person by proxy or being a 
corporation is present by a duly authorised representative not being himself a member shall have one vote on a poll every holder of ordinary shares who is present in 
person or by proxy shall have one vote for every ordinary share held by him
communication
12 except as provided above members who have general queries about the meeting should use the following means of communication no other methods of communication 
will be accepted
•	 c a l l i n g	c a p i t a	r e g i s t r a r ’ s	s h a r e h o l d e r	h e l p l i n e	 l i n e s	a r e	o p e n	f r o m	9  0 0	a m	t o	5 3 0	p m	m o n d a y	t o	f r i d a y 	e x c l u d i n g	p u b l i c	h o l i d a y s  
i  from uk 0871 664 0300 calls cost 10p per minute plus network extras
ii  from overseas 44 208 639 3399 calls from outside the uk are charged at applicable international rates or
•	 i n	w r i t i n g	t o	c a p i t a	r e g i s t r a r s 
 you may not use any electronic address provided either
•	 i n	t h i s	n o t i c e	o f	m e e t i n g 	o r	
•	 a n y	r e l a t e d	d o c u m e n t s	 i n c l u d i n g	t h e	f o r m	o f 	p r o x y	f o r	t h i s	m e e t i n g 
 to communicate with the company for any purposes other than those expressly stated
notice of annual general meeting  ⁄ continued 69
lupus capital plc
annual report  accounts 2010
notes ⁄ 70
lupus capital plc
annual report  accounts 2010
notes ⁄ 71
lupus capital plc
annual report  accounts 2010
form of proxy ⁄
lupus capital plc
iwe 
of 
block capitals please
being a members of lupus capital plc appoint the chairman of the meeting 
or see note 1
of 
as myour proxy to attend and vote for meus and on myour behalf at the annual general meeting of the company to be held at 
the offices of college hill the registry royal mint court london ec3n 4qn on 27 may 2011 at 1030 am and at any 
adjournment thereof
please indicate with an x in the spaces provided how you wish your votes to be cast on the resolutions specified
resolution for against abstain
1 to receive and adopt the audited financial statements for the year ended 31 december 2010
2 to declare a dividend of 200p per ordinary share 
3 to reelect mr pike as a director
4 to reelect mr eperjesi as a director
5 to elect mr brotherton as a director
6 to reelect mr tench as a director
7 to reelect mr towers as a director
8 to reappoint grant thornton uk llp as independent auditors to the company 
9 to authorise the directors to set the auditors’ remuneration
10 to approve the directors’ remuneration report
11 to authorise the directors to allot securities up to an aggregate nominal amount of 
£216401330 
12 to authorise the directors to allot securities free from preemption rights subject to certain 
specified limitations
13 to authorise the company to purchase its own shares
subject to any voting instructions so given the proxy will vote or may abstain from voting on any resolution as he may think fit
signature  dated this  day of  2011
notes
1 if you so desire you may delete the words ’chairman of the meeting’ and insert the name of your own choice of proxy who need not be a member of the company please 
initial such alteration
2 the proxy form must be lodged at the company’s uk registration agent capita registrars proxies the registry 34 beckenham road beckenham kent br3 4tu not 
less than 48 hours before the time fixed for the meeting in default the proxy cannot be treated as valid
3 alternatively in the case of crest members voting may be effected by using the crest electronic proxy appointment service crest members who wish to utilise the 
crest service may do so by following the procedures described in the crest manual crest personal members or other crest sponsored members and those crest 
members who have appointed a voting service provider should refer to their crest sponsor or voting service provider who will be able to take the appropriate action on 
their behalf in order for a proxy appointment made by means of crest to be valid the appropriate crest message must be transmitted so as to be received by the 
company’s agent capita registrars whose crest id is ra10 by the specified latest time for receipt of proxy appointments for this purpose the time of receipt will be 
taken to be the time as determined by the timestamp applied to the message by the crest applications host from which the company’s agent is able to retrieve the 
message by enquiry to crest in the manner prescribed
4 a corporation must execute the proxy under its common seal or under the hand of an officer or attorney duly authorised
5 if this proxy form is executed under a power of attorney or other authority such power of attorney or other authority or a notarially certified copy thereof must be lodged with 
the registrars with the proxy form
6 in the case of joint holders the vote of the senior shall be accepted to the exclusion of the other joint holders seniority being determined by the order in which the names 
stand in the register in respect of the joint holding contents
01 highlights
02 our business at a glance 
04 chairman’s statement
06  chief executive officer’s and chief  
financial officer’s review
08 business review
12 principal risks and uncertainties
14  corporate social responsibility report
16 board of directors
18 directors’ report 
20 corporate governance
23 directors remuneration report
29 independent auditors’ report
30  consolidated income statement
31  consolidated statement of  
comprehensive income
31  consolidated statement of changes 
in equity
32 consolidated balance sheet
33 group cash flow statement
34  notes to the financial statements
60 independent auditor’s report
61 company balance sheet
62 notes to the company financial  
 statements
65 advisers
65 definitions
65 roundings
65 exchange rates
66 notice of annual general meeting
71 form of proxy
lupus capital plc is a leading international supplier of building 
products to the door and window industry and the world’s 
number one manufacturer of marine breakaway couplings wwwlupuscapitalcouk
lupus capital plc
annual report  
accounts 2010
lupus capital plc
65 buckingham gate
london sw1e 6as
44 020 7976 8000
wwwlupuscapitalcouk
lupus capital plc annual report  accounts 2010


Summary:
  chief executive  ⁄
officer’s and  
chief financial 
officer’s review
06
lupus capital plc
annual report  accounts 2010
underlying net debt £m
80
100
120
140
160
dec 10 dec 08 jun 09 dec 09 jun 10
before capitalised fees
group 2010 operational performance
during 2010 we remained focused on maintaining tight controls 
over costs in all our businesses headcount at 31 december 2010 
of 2004 was in line with the prior year 2009 2003 as we flexed 
labour where necessary and permitted limited selective hiring of 
permanent personnel only where merited by business activity 
levels significant increases in raw material prices were seen during 
the year most notably in steel and oil derivative products and local 
management were diligent in passing these on to customers in 
order to protect our gross margins 
throughout 2010 we have continued to reassess and flex our 
global production footprint to optimise our margins and improve 
our customer offering the conversion of our chinese 
manufacturing operation to a sourcing operation in february 2010 
has allowed us greater flexibility in obtaining the lowest cost 
highest quality product production levels at the group’s mexican 
operation have been significantly increased during the year and we 
vacated our site at tipton in the west midlands building work has 
started in sioux falls south dakota for a planned expansion to 
consolidate our sioux falls door hardware and balance 
manufacturing businesses onto a single site this is expected to be 
completed during 2011
we have continued our focus on tight management of working 
capital despite increased turnover we successfully increased our 
stock turn in 2010 and reduced our investment in inventory held at 
the year end during the year a number of our customers ceased 
trading however vigilant management of customer credit risks 
throughout the year starting at the point of sale meant that bad 
debts written off amounted to only 01 per cent of sales 2009 03 
per cent 
we continue to promote the financial strength of the group to the 
credit insurers of our major suppliers in order to optimise the credit 
terms that we receive from our supplier base and to work closely 
with our customer base to ensure we understand their balance 
sheet position and creditworthiness
financial performance in the period
for the year ended 31 december 2010 compared with the prior 
year
sales
total sales of £2662 million increased by 102 per cent from prior 
year 2009 £2416 million in constant currency terms on a like for 
like basis total sales increased in the year by 124 per cent 
margins
despite challenging trading conditions and increasing raw material 
costs the group’s gross profit margin increased to 349 per cent 
from 333 per cent in 2009 the underlying operating margin for 
the group increased from 106 per cent in 2009 to 126 per cent 
in 2010 
the group continued to flex its cost base in line with demand such 
that the dropthrough margin on incremental sales in the year was 
328 per cent
james brotherton
chief financial officer
louis eperjesi
chief executive officer
we have continued  
our focus on tight 
management of working 
capital despite 
increased turnover we 
successfully increased 
our stock turn in 2010 
and reduced our 
investment in inventory 
held at the year end  07
lupus capital plc
annual report  accounts 2010
during 2010 the group repaid £21 1 million of  ⁄
debt to bring the total debt repayments made 
since the refinancing in july 2009 to £414 million
cash flow
despite the 102 per cent increase in sales in 2010 the group 
generated £17 million cash from net working capital reductions 
2009 £107 million these reductions combined with the 
increased operating profit generated by the group meant that the 
net cash inflow from operating activities of £363 million remained 
broadly in line with prior year 2009 £365 million 
operating cash conversion being the proportion of underlying 
operating profit converted into cash exceeded 100 per cent at 
105 per cent in 2010 2009 142 per cent 
capital expenditure increased by 57 per cent to £35 million 2009 
£22 million 
net debt position
during 2010 the group repaid £211 million of debt to bring the 
total debt repayments made since the refinancing in july 2009 to 
£414 million 
at 31 december 2010 the group’s underlying net debt was £947 
million which was £215 million lower than prior year 2009 £1162 
million despite adverse exchange rate movements increasing net 
debt by £20 million 
average underlying net debt during the year was £1139 million 
2009 £1356 million under the ifrs definition which reduces 
debt by the unamortised bank fees net debt at the year end was 
£917 million 2009 £1110 million
banking
at 31 december the group had headroom against its banking 
covenants ranging from 47 per cent to 75 per cent and the board 
remains confident that the group will continue to operate within its 
banking covenants as set out in the current banking facility 
agreements which expire in july 2012 
the group’s key banking performance metric being the  
proportion of net debt to underlying ebitda at the year end  
was 238x 2009 366x calculated on the same basis as the 
banking covenants
defined benefit pension and post retirement benefit schemes
the group’s principal defined benefit pension scheme and post 
retirement healthcare benefit scheme is operated in the us the 
pension scheme is closed to new entrants and post retirement 
healthcare benefit contributions are capped
at 31 december 2010 the defined benefit obligation for all group 
pension and post retirement healthcare benefit schemes was 
£189 million 2009 £174 million and the schemes had plan assets 
of £116 million 2009 £99 million resulting in a slightly reduced 
net deficit on the schemes of £73 million 2009 £75 million
louis eperjesi   james brotherton
chief executive officer  chief financial officer
23 march 2011
profits
underlying earnings before interest tax depreciation and 
amortisation were £402 million 2009 £323 million 
underlying operating profit increased by 316 per cent to £337 
million 2009 £256 million on a constant currency basis this 
represents an increase of 304 per cent over the prior year 
underlying administrative expenses increased by £42 million or 77 
per cent to £591 million 2009 £549 million administration costs 
included higher freight commission and management incentive 
costs associated with the increased levels of activity and higher 
legal costs associated with defence of intellectual property rights
net finance costs decreased by £06 million to £120 million 2009 
£126 million reflecting reduced debt levels the 2009 interest rate 
benefited from the lower margins payable on the group’s facilities prior 
to the refinancing in july 2009 net cash interest paid of £93 million 
2009 £105 million was 12 per cent lower than that paid in 2009
fair value losses on financial instruments increased by £09 million 
in 2010 due to outofthemoney interest rate hedges taken out in 
2007 that did not expire until 30 september 2010 during the year 
the group entered into a number of interest rate swap transactions 
which had the economic effect of fixing the group’s cost of funds 
before the applicable margin at between 185 and 2045 per cent 
until july 2012
underlying profit before taxation was 561 per cent higher at £245 
million 2009 £157 million
earnings per share
underlying earnings per share increased by 367 pence or 391 per 
cent to 1306 pence 2009 939 pence basic earnings per share 
increased from 032 pence in 2009 to 543 pence 
exceptional costs
exceptional costs of £04 million 2009 £21 million were incurred 
during the period principally in connection with the outsourcing of 
further activity from the uk to china and the general meeting held 
in february 2010
taxation
the tax charge increased to £25 million in 2010 2009 tax  
credit £11 million excluding the effect of the change in tax  
rates on deferred tax assets and the adjustments in respect of 
prior periods the underlying tax rate on the underlying profit 
before taxation was 32 per cent 2009 28 per cent the 
underlying tax rate increased during 2010 due to the geographic 
mix of profit growth 
the underlying cash tax rate in the year was 9 per cent 2009 14 
per cent and is lower than the underlying tax rate due to historic 
losses the underlying cash tax rate is expected to trend towards 
the underlying tax rate over the coming years
financial position
during the year the group continued to focus on the tight 
management of working capital operational cash generation and 
the reduction of net debt