shed media plc 
 
 
 
report and accounts 2008  01 financial highlights
0 2 chairman’s statement
0 3 chief executive’s statement
0 5 financial review
08 board of directors
1 1 directors’ report
1 7 corporate governance report
1 9 directors’ remuneration report
2 2 statement of directors’ responsibilities
2 3 independent auditor’s report 
2 5 consolidated income statement
2 6 consolidated balance sheet
2 7 consolidated statement of changes in equity
2 8 consolidated cash flow statement
2 9 notes to the consolidated financial statements
5 9 explanation of transition to ifrs
6 3 company balance sheet
6 4 company accounting policies
6 6 notes to the company financial statements
7 1 contacts and company information
shed media annua l report  accounts 2008
contents
116127 shed pt1  14509  1228 pm  page i financial highlights
year ended 16 months ended
31 december 2008 31 december 2007
turnover £819m £631m
gross profit £310m £234m
adjusted
1
operating profit £145m £110m
operating profit £123m £105m
adjusted
1
operating margin 18 17
adjusted
2
profit before tax £119m £99m
profit before tax £79m £94m
adjusted
2
diluted earnings per ordinary share 1046p 1006p
diluted earnings per share 677p 955p
final dividend 125p 11p
1 adjusted operating profit is stated before intangibles amortisation arising from business combinations 
2 adjusted profit before tax and adjusted diluted earnings per ordinary share is before intangibles amortisation arising
from business combinations interest charges relating to discounted deferred consideration and fair value loss on
financial instruments
01
shed media annua l report  accounts 2008
116127 shed pt1  14509  1228 pm  page 01 116127 shed pt1  14509  1228 pm  page b 116127 shed pt1  14509  1229 pm  page c shed has again delivered an excellent set of results for the year to 31 december 2008 the group has
successfully integrated its acquisitions outright distribution twenty twenty and wall to wall and
continued to grow organically 
during the year revenue from the group’s core activities content production and ip exploitation has
increased to £82m 2007 16 months £63m of particular importance was the growing revenue stream
from the us that now makes up 30 2007 16 months 26 of group gross profit the group has
maintained its excellent adjusted operating margins of 18 2007 16 months 17 a final dividend has
been proposed of 125p per ordinary share 2007 11p this dividend will also be available to shareholders
as a scrip issue of ordinary shares
whilst the uk production market is challenging shed is benefiting from its ability to produce longrunning
returnable brands for its broadcast partners of particular note are the popular bbc one drama series
new tricks and waterloo road and the factual shows who do you think you are and the choir 
with uk produced content and formats still leading the world outright distribution continues to capture
more profit growth from group and third party product the group library has expanded to over 2900
hours and is selling into over 200 territories at a time when international broadcasters are looking to cut
their original content spend having such a quality catalogue has given shed media a significant competitive
advantage
during the year eileen gallagher decided to step down as group chief executive i am delighted that
eileen remains on the board as chief executive of shed productions eileen is a tremendous asset to the
group having led shed through a successful ipo and delivering on the strategy to diversify and strengthen
the group through acquisitions i would like to take this opportunity to thank eileen for her leadership to
date
the board welcomed the appointment of nick southgate to the role of group chief executive nick in his
previous role of chief operating officer led the integration of the group companies and the expansion
into america and is extremely well placed to drive shed forward 
i would also like to thank katherine innes ker for her contribution as chair over the last four years the
group is in the process of identifying a new chair and two non executive directors and we hope to make a
further announcement shortly
finally the content produced and distributed by the group in 2008 is the product of many hardworking
individuals and i’d like to thank all of our employees for their efforts during the year
david kogan
02
shed media annual report  accounts 2008
chairman’s statement
116127 shed pt1  14509  1229 pm  page 02 overview for the 12 months
i am pleased to announce shed media’s final results covering the 12 months to 31 december 2008
during the period adjusted operating profit increased to £145m from £9m up 61 on a like for like basis
3
2007 16 months £11m 
the group delivered 215 hours of programming up from 209 in the 16 months to 31 december 2007 of
which 29 hours was drama and 186 was factual programmes included new primetime bbc drama hope
springs waterloo road series four new tricks series five who do you think you are series six and supernanny
us series five
over the past twelve months the breadth of shed media’s programming has grown substantially we are
now delivering quality primetime drama factual entertainment documentary current affairs children’s
and daytime programmes for 21 different broadcasters the year also saw our first foray into feature
documentaries with the production of wall to wall’s man on wire which has gone on to win numerous
awards including an oscar and a bafta twenty twenty’s award winning factual programme the choir
also picked up an rts for best constructed factual series and an award for best factual programme at the
industry broadcast awards
business in the us has grown strongly with 64 hours delivered compared to 32 in 2007 and the group
has delivered on its stated aim of leveraging acquired companies’ product into the us market both
twenty twenty and wall to wall won us commissions for uk formats world’s strictest parents and who do
you think you are which are currently being produced out of our us office 
shed media’s inhouse distribution arm outright distribution has performed well successfully distributing
shed media content and growing its third party business revenue from the group’s ip exploitation
accounted for 44 of gross profit the uk is the world leader in exploiting format rights and outright
distribution represents an increasingly strong highly cash generative and profitable part of shed media’s
business as we move forward we will continue to concentrate our efforts on growing and developing this
very high quality earnings stream both through the rapid expansion of our own library and attracting more
third party content
uk business
despite the challenging uk environment shed media has delivered highquality content for all terrestrial
broadcasters and several digital channels
shed productions delivered a new primetime drama hope springs 8 x 60’ and waterloo road 20 x 60’ for
bbc one 
wall to wall delivered new tricks series five 8 x 60’ and series six of ratings winner who do you think you
are 5 x 60’ both for bbc one new tricks series six 8 x 60’ is currently in production 
ricochet’s output included dangerous jobs for girls 4 x 60’ for channel 4 cowboy builders 6 x 60’ for five
extreme dreams 20 x 30’ for bbc two and blood sweat and tshirts 4 x 60’ for bbc three
twenty twenty’s new strand world’s strictest parents 6 x 60’ received the highest ever ratings for a
factual series on bbc three other programmes delivered during the period included almost perfect guide
to life for bbc two 5 x 30’ and the sorcerer’s apprentice 40 x 30’ for bbc one
since the year end major recommissions for delivery in 2009 include a fifth series of shed productions’
waterloo road 20 x 60’
03
shed media annua l report  accounts 2008
chief executive’s statement
116127 shed pt1  14509  1229 pm  page 03 wall to wall received orders for a seventh and eighth series of new tricks and a seventh series of who do
you think you are and expanding on its ‘genius’ strand bbc two commissioned the genius of design 5 x
60’ new series commissions include electric dreams 3 x 60’ for bbc four people’s supermarket 4 x 60’
for channel 4 and sea patrol 10 x 30’ for five
ricochet’s commissions include the real swiss family robinson 4 x 60’ a new primetime series for bbc
one blood sweat and takeaways 4 x 60’ for bbc three going back 4 x 60’ a new series for channel 4
and a recommission of cowboy builders 12 x 60’ for five
twenty twenty’s world’s strictest parents 7 x 60’ has been picked up by bbc three for a second series and
the bafta award winning the choir for a third and fourth series bbc four has also ordered 2 x 60’
programmes featuring the choir’s gareth malone new programming includes family gap year 2 x 60’ for
channel 4 strictly high school 2 x 60’ for sky one and a new prime time drama for bbc 4 x 60
us business
during the year shed media us delivered 64 hours of programming up 100 on last year returning
brands included a fifth series of supernanny us 25 x 60’ for abc and the real housewives of new york city
series two 12 x 60’ for bravo
other commissions included anatomy of a takedown 3 x 60’ and aviation safety 2 x 60’ both for the
discovery channel surviving disaster 10 x 60’ for spike and outlaw bikers 3 x 60’ for national
geographic
shed media continued its strategy of bringing uk formats to the us market with the commission of
ricochet’s it’s me or the dog 20 x 30’ for animal planet wall to wall’s who do you think you are for nbc
7 x 60’ and twenty twenty’s world’s strictest parents 8 x 60’ for cmt 
supernanny us was sold into the us cable market in partnership with abc and will provide a steady stream
of revenue from 2009 and beyond
since the year end it’s me or the dog has been recommissioned for a second series 29 x 60’ for animal
planet supernanny us has had a 12 x 60’ extension to the season 5 order and a further supermanny
episode has been ordered currently shed media us has seven new projects in paid development for us
broadcasters 
outlook
three months into our current financial year and the group has secured 61 of its production revenue
target and over 50 of its ip target the us presents a significant area of growth for the group with 62
of the revenue target already achieved ip revenue will continue to perform strongly with outright’s
expanding library of group and third party content
the group had a good 2008 and we’ve started 2009 strongly as ever our talented and experienced team
will be working hard to create and produce the new brands of the future 
nick southgate 
04
shed media annual report  accounts 2008
chief executive’s statement continued
116127 shed pt1  14509  1229 pm  page 04 revenue and profits
the year ending 31st december 2008 saw revenue increase to £819m 2007 16 months £631m
geographically 26 of group gross profit in 2008 was from the uk 2007 16 months 32 30 from the
us 2007 16 months 26 and 44 from the rest of the world 2007 16 months 42
during the year the group was commissioned directly by 21 broadcasters in both the uk and us and sold
production rights to over 200 territories worldwide 
statutory reported operating profits are £123m 2007 16 months £105m with a reported profit before
tax of £79m 2007 16 months £94m adjusted operating profits
1
are £145m 2007 16 months £110m
with an adjusted profit before tax
2
of £119m 2007 16 months £99m
adjusted operating margin
1
was 18 2007 16 months 17 and gross margin was 38 2007 16 months
37 the consistency in the operating margin is due to strong ancillary sales and tight control of
production costs in the period and continuing tight control of overheads
capital structure and treasury policy
during the year shed increased its issued ordinary shares to 79716502 2007 78970292 ordinary shares
of 01p each the increase in issued ordinary shares financed the final earnout for outright distribution
limited
in the prior year a five year debt facility of £32m was set up with barclays and the bank of ireland to fund
the acquisitions of twenty twenty and wall to wall and to refinance the existing debt facility taken out to
finance the purchase of ricochet and outright
during the year loan notes totalling £4m were redeemed as part of the acquisition agreements of wall to
wall and twenty twenty
at 31 december 2008 facility a had a loan balance of £286m 2007 £32m the movement from the prior
year is explained by repayments of £55m and an increase in the facility of £21m due to the redemption of
the wall to wall loan notes
at 31 december 2008 the group also had an £8m working capital facility facility b the loan balance at
31 december 2008 was £29m 2007 nil the movement from the prior year was due to the draw down of
£19m due to the redemption of the twenty twenty loan notes and a draw down of £1m in working
capital
the group has now extended the existing loan facilities until 2011
earnings per share
basic earnings per share in the year was 685p 2007 16 months 966p based on earnings of £54m 2007
16 months £64m divided by the weighted average number of shares in issue during the year of
78886358 2007 65964663 diluted earnings per share in the year was 677p 2007 16 months 955p
based on the weighted average number of shares in issue of 79754822 2007 66699963
adjusted basic earnings per share
2
was 1058p 2007 16 months 1017p and adjusted diluted earnings per
share
2
was 1046p 2007 16 months 1006p
cash flow 
net cash inflow from operating activities was £235m 2007 £44mthe overall net cash increased by
£24m 2007 £72000 decrease which was driven by cash generated from increases in operating activities
05
shed media annua l report  accounts 2008
financial review
116127 shed pt1  14509  1229 pm  page 05 timing of receipts offset by higher interest charges and loan repayments from the first full year of the new
loan facility
dividend
the board is recommending a final dividend of 125p per share 2007 11p subject to approval by
shareholders at the annual general meeting to be held on 10 june 2009 the final dividend will be paid on
17 june 2009 to shareholders on the register on 15 may 2009 subject also to approval of shareholders at
the annual general meeting the group is proposing to introduce a scrip dividend alternative which will
give shareholders the opportunity to elect whether they wish to receive the dividend in cash or in the form
of ordinary shares in the group details of the scrip dividend alternative will be sent to shareholders in
due course to enable them to make their choice
covenants
under the terms of the loan the group is tested quarterly on a 12 month rolling ebitda interest cover and
leverage a ratio of total nonproduction debt to ebitda interest cover for the year ended 31 december
2008 was 45 times and the leverage based nonproduction debt was 20 during the year all covenants
were passed
hedging
during 2008 at the banks’ request we put into place an interest hedge to manage our interest rate
exposure the board is currently reviewing its hedging policy at the year end £27m of the group’s facility
was hedged
taxation
the tax charge for the year is £25m 2007 16 months £31m at an effective rate of 312 2007 326
the effective rate is higher than the 28 tax rate in the period due to tax paid at a higher rate on overseas
tax and the partially non tax deductible impact of the ifrs 2 share option charge 
balance sheet
property plant and equipment the £01m decrease in the year is due to higher depreciation cost than
additions
receivables the increase in receivables in the year is due to production dollar denominated invoices
revalued at the year end closing rate and increased business within the distribution company outright of
the £187m 2007 £178m £97m were trade receivables and £82m represented accrued income 
current liabilities the increase in current liabilities in the year to £345m 2007 £291m has been due to
the reclassification of deferred consideration from non current to current of £43m an increase in
deferred income mainly from the timing of us productions and the draw down on the working capital
facility of £29m this is partially offset by decreases in short term borrowings due to the repayments at
the year end short term bank loans for production funding totalled £15m
noncurrent liabilities during the year noncurrent liabilities decreased to £278m 2007 £356m as
payments were made on the 5 year loan facility deferred consideration was reduced by the payment to
outright the reclassification to current liabilities of the wall to wall earn out and from the non payment
of the twenty twenty earnout this is partially offset by the fair valuation of the interest rate collar of
£16m
06
shed media annual report  accounts 2008
financial review continued
116127 shed pt1  14509  1229 pm  page 06 goodwill during the year goodwill decreased to £613m 2007 £615m this was mainly due to the
recognition of additional consideration from the wall to wall acquisition and the revision to deferred
consideration from the twenty twenty acquisition
intangible assets intangible assets increased to £245m 2007 £244m this was mainly due to the
increase in film assets in the current year the group capitalised on average 13 of film costs arising from
new drama productions and 13 on film costs arising on new factual entertainment productions the film
asset will be amortised over the remaining life of the film asset defined by expected future sales
intangible assets arising from acquisitions decreased £22m to £109m 2007 £131m due to amortisation
international financial reporting standards
these are the group’s first annual results to be reported under international financial reporting standards
“ifrs” which become mandatory for all companies listed on aim market for accounting periods
commencing on or after 1 january 2007 comparative figures for the period ended 31 december 2007
have been presented in accordance with ifrs the principal effects of adopting ifrs were published in the
group’s interim results announcement issued on 30 september 2008 the group has adopted the material
exemption as permitted by ifrs not to restate the historical business combinations that took place before
1 september 2006
jonathon kemp
financial and commercial director
1 adjusted to exclude intangibles amortisation arising from business combinations
2 adjusted to exclude intangibles amortisation arising from business combinations interest charges arising from
discounted deferred consideration and finance costs from the fair value loss on financial instruments
07
shed media annua l report  accounts 2008
financial review continued
116127 shed pt1  14509  1229 pm  page 07 chief executive officer shed media plc nicholas southgate
nick started his television career in wildlife filmmaking working for the bbc’s acclaimed natural history
unit after five years at the bbc including time spent on tomorrow’s world and in bbc childrens nick set
up his own independent production company tiga films where he produced and directed documentaries
for the bbc and channel 4
nick joined ricochet in 1999 as a producerdirector and in 2000 he formed ricochet digital with nick
powell where he executive produced projects including ‘who rules the roost’ ‘fightbox’ and ‘tetris
from russia with love’
following the merger between ricochet digital and ricochet south nick became creative director of the
new company ricochet limited and subsequently managing director where he continued to oversee a
number of key projects both in the uk and for ricochet los angeles 
in 2005 shed acquired ricochet and in 2007 nick was appointed as the chief operating officer of the
enlarged group he played a key role in the acquisitions of twenty twenty and wall to wall
nick was appointed as the chief executive officer of shed media plc on 1 january 2009
financial and commercial director shed media plc jonathon kemp
jonathon kemp joined shed in 2002 from capitol films a film production and financing company where
he was head of finance jonathon started his media career at nickelodeon uk where he worked for five
years during which time he qualified as an acma accountant he moved from nickelodeon uk to fox kids
europe in 1999 where he was involved with the flotation of the company
jonathon joined shed as financial controller with the responsibility of building both a strong financial and
commercial base he was promoted to the board and became finance director of shed in 2004 where his
main responsibility was to help grow the business and played a key role in the flotation of the company in
2005 and the acquisitions of ricochet outright wall to wall and twenty twenty he continues to look
after both the group’s finance and commercial departments
chief executive shed productions eileen gallagher
prior to cofounding shed productions eileen was managing director of lwt london weekend
television and deputy managing director of granada broadcasting she also cocreated bad girls and the
fugitives
eileen’s business experience and strong creative influence have been instrumental in shed media’s success
as chair of the independent producers’ trade association pact for 2002 and 2003 she was at the
forefront of the successful campaign to introduce amendments into the communications bill to
strengthen the position of the independent production sector in its dealings with broadcasters in
20022003 eileen picked up two industry awards for outstanding achievements for her work with shed
and the independent production sector as a whole after ten years as md and then chief executive of
shed media plc eileen stood down at the end of 2008 to return to a creative role as ceo of shed
productions
managing director shed productions brian park
brian park was previously head of entertainment at granada where he stewarded stars in their eyes
you’ve been framed and russ abbot his subsequent move to drama resulted in him producing true love
and prime suspect he took over an ailing coronation street restoring it as the uk’s biggest rating show
brian produced the first two series of bad girls and has been executive producer on the subsequent series
of bad girls all series of footballers’ wives waterloo road bombshell rock rivals and hope springs
08
shed media annual report  accounts 2008
board of directors
116127 shed pt1  14509  1229 pm  page 08 chief executive ricochet nicholas powell
nick began working in tv in 1987 at brook productions as a researcher on a major series on the
international debt crisis he worked at diverse productions in 1988 working on 9 to 5 and at box
productions on the harrods sale in 1989 he transferred to channel 4 where he produced comment
before becoming series producer on out of africa and then series editor on right to reply
in 1995 nick formed ricochet assuming the role of managing director during the last 10 years he has
executive produced over 500 hours of primetime network television in the uk with many of the series
having been shown and broadcast throughout the world he has overseen many projects including no
going back its me or the dog risking it all and supernanny in 2003 nick established a los angeles office
and executive produces the american version of supernanny for abc as well as managing the growth of
ricochet nick oversees development and overall company strategy in 2005 shed acquired ricochet and
nick was appointed to the board of shed media plc
managing director outright distribution chris bonney 
chris bonney is the managing director of outright distribution shed media’s wholly owned distribution
company specialising in the areas of factual entertainment formats and drama 
chris began his career in 1986 at ecm a specialist in advertiserfunded programming and format
distribution he left in 1989 to join the tv programming department at saatchi  saatchi followed by a
spell as manager of sponsorship at tyne tees television chris rejoined ecm at the end of 1991 where he
rose to become chief operating officer in 2001 together with a team of experienced television
distribution executives from ecm chris established screentime partners as an mbo in august 2003 which
changed its name to outright distribution limited in january 2007 following the acquisition by shed media
in 2006 chris is also a member of pact council and the tv exports group
managing director twenty twenty peter caselyhayford 
peter caselyhayford is the managing director of twenty twenty and has been in the television industry
since 1976 he began his career at the bbc in the television accounts department where he gained
experience of management and finance in the tv industry later he moved to news and current affairs
managing programmes such as question time and newsnight before becoming production unit manager
of panorama for 5 years 
peter joined twenty twenty in 1990 as the manager of production looking after all areas of management
within the company in 1996 peter became a director shareholder of twenty twenty and was subsequently
promoted to managing director in 2003 since that time he has been responsible for the running of the
business and profitability of the company following shed media’s acquisition of twenty twenty in
september 2007 peter was appointed to the board of shed media plc
chief executive wall to wall alex graham 
born in glasgow wall to wall ceo alex graham has built the company into one of the uk’s leading
independent producers with a reputation for quality and innovation wall to wall has won almost every
award on both sides of the atlantic including several baftas emmys royal television society and
peabody awardswall to wall was recently voted one of the top seven independent producers in the world
by real screen magazine in november 2007 wall to wall became part of the shed media group of
companies 
alex helped create several of wall to wall’s hit shows including the 1900 house and who do you think
you are he is executive producer of several of the company’s leading shows including who do you
think you are and new tricks
09
shed media annua l report  accounts 2008
board of directors continued
116127 shed pt1  14509  1229 pm  page 09 alex sits on the board of shed media he is a member of pact council where he served as chair during
2006 and 2007 he also sits on the board of the sheffield international documentary festival he is a fellow
of the royal television society the royal society of arts and a visiting fellow of the university of
bournemouth’s media school
nonexecutive director david kogan†
david kogan is the chief executive and co founder of reel enterprises limited a company specialising in
rights negotiations channel development and sport in the uk and global media markets reel enterprises
advise the bbc and other leading uk broadcasters as well as leading sports leagues such as the fa premier
league on all its media rights deals in the uk and overseas
in 1979 david worked as a marketing executive at express newspapers and then in 1982 he joined the bbc
where he worked as a senior producer on news and current affairs programmes such as today newsnight
and breakfast time he was the bbc radio editor in new york in 19845 in 1988 he joined reuters
television as managing editor he subsequently became managing director in the united kingdom and was
then for three years the global managing director he also acted as the launch managing editor of gmtv
in 1993 in 1996 david joined the granada media group as executive director of granada channels which
he left to create reel enterprises in 1998
 member of the audit committee
† member of the remuneration committee
10
shed media annual report  accounts 2008
board of directors continued
116127 shed pt1  14509  1229 pm  page 10 the directors have pleasure in presenting their report on the company and the group together with the
audited financial statements for the year ended 31 december 2008
principal activity
shed media the “group” is an independent television production company the group specialises in
contemporary original drama and factual programming and content and in distribution of subsequent
rights from these programmes
results and dividends
the results for the group show a pretax profit of £79 million 2007 16 months £94 million for the year
and sales of £819 million 2007 16 months £631 million net cash flow from operating activities for 2008
was £235 million 2007 16 months £44 million 
the final dividend proposed at 31 december 2007 of 11p per share was paid 18 july 2008 to shareholders
on the register at 20 june 2008
business review
business environment
the independent television market has benefited from changes in the law the communications act in
2003 and the corresponding changes in terms of trade have enabled producers to own and control the
rights to the content they create this new legislation has most benefited those companies that create
valuable rights that sell well in international and uk secondary markets
the emergence of new media is also an important development in the television market new technology
such as mobile phone streaming and internet downloading give independent producers more
opportunities to exploit their content the companies which own attractive recognisable brands that
platform owners need benefit most from these market developments
the independent production sector has traditionally been fragmented with hundreds of companies
producing a limited number of programmes and owning few if any of the rights to those programmes
the favourable changes to market conditions have enabled the emergence of a few dominant players
strong enough to buy out smaller competitors this has led to the creation of the “super indie” which
benefits from diversification into different production genres thus mitigating the risks associated with
creative businesses
within this competitive environment the group has differentiated itself from its competitors as follows
• business model – focussed on multiple profit streams rather than turnover
• brands – creating powerful brands that sell internationally and across new platforms
• operating margins – consistently delivering strong operating margins
• visibility of revenue – strong brands and a good reputation with broadcasters who recommission
existing brands and are open to new programme developments
• growth – organically through an expanding inhouse talent pool and strategically through
acquisition of brand – owning brandcreating companies
11
shed media annua l report  accounts 2008
directors’ report
116127 shed pt1  14509  1229 pm  page 11 strategy
the group’s overriding objective is to achieve attractive and sustainable rates of growth and returns
through a combination of organic growth and acquisitions 
• strong organic growth through
• • maintaining and securing key production talent
• • building on success and reputation with broadcasters
• • successful exploitation of programming rights
• • building new broadcaster relationships in the uk and internationally and in particular the us
• selective acquisition of companies meeting strict criteria
• • production companies in valuable new genres
• • brand owning and brand creating capabilities
• • talent tied in by ownership
• • right price
• • new media
key performance indicators “kpis”
the board monitors progress on the overall group strategy and the individual strategic elements by
reference to seven kpis
1 liquidity
the board monitors cashflow on a continual basis which is reviewed monthly at the board meetings prior
to bank review loan and interest payments are made quarterly and the group ensures it is sufficiently
liquid to make the loan repayments for the forthcoming year 
2 growth in sales  
year on year sales growth expressed as a percentage the increase is in line with the group’s growth
strategy sales have improved due to our first successful full year following the acquisition and integration
of outright distribution limited twenty twenty productions limited and wall to wall holdings limited
this has led to the group strengthening its product through expansion of its genres and making direct
distribution sales thereby not incurring commission on the sale of new products 
3 gross margin  
gross margin is the ratio of gross profit before exceptional items and intangibles amortisation to sales
expressed as a percentage gross margin has increased in the year to 38 2007 16 months 37
benefiting from strong intellectual property sales and tight control of production costs and strong margins
in the us
4 operating profit margin 
operating profit margin is the ratio of operating profit before exceptional items and intangibles
amortisation to sales expressed as a percentage gross margin is important to maintain to ensure
productions are profitable but it is essential the group keeps overheads under control and maintains a
strong operating profit margin the group produced a strong operating profit margin in the year of 18
12
shed media annual report  accounts 2008
directors’ report continued
116127 shed pt1  14509  1229 pm  page 12 2007 16 months 17the operating profit margin is very strong compared to the industry as a whole and
as a kpi will continue to be monitored by the group
5 ebitda 
the group monitors its ability to pay loans on a monthly basis by reviewing interest to ebitda and loan
amount to ebitda the group ensures it is clearly able to meet the terms set out in its loan agreements
6 programming hours
the group monitors commissioned programming hours per annum as a kpi the group produced 215
programme hours 29 drama hours and 186 factual hours 2007 16 months 209 programme hours
7 international sales
in order to grow as a business it is important for the group to continue to exploit its programmes in the
international market this performance target is reviewed quarterly and the group anticipates annual
growth which enables continual growth of the business this area of the business has continued to grow in
the year
principal risks
risks are formally reviewed by the board and appropriate processes put in place to monitor and mitigate
them if more than one event occurs it is possible that the overall effect of such events would compound
the possible adverse effects on the group
the directors consider the following to be the principal risks faced by the group
1 competition
the group operates in a highly competitive market with many companies small and large competing for
broadcasters’ commissions for the group to grow it needs to secure recommissions of existing brands
and have new programme brands ready to be commissioned when more mature ones fade to mitigate
the risk of a slowdown in the overall rate of growth our creative teams are constantly developing new
programme brands to ensure a healthy pipeline of new productions
a reputation for consistently delivering high quality programmes is a prime asset in the market and this
reputation is dependent on maintaining a pool of high quality creative staff
2 key creative staff
the group’s performance depends largely on the retention of key creative staff the loss of key individuals
or failure to recruit sufficient talent with the right experience and skills can adversely impact the group’s
results the group has also successfully trained up younger staff members to take on creative roles and has
been successful in retaining them over the long term when acquiring companies the group ensures that
the talent is tied in through share ownership and performancebased earn out schemes
3 control of productions costs
once the executive producers have negotiated programme prices with the broadcasters an internal
budget is agreed and it is up to the production departments to ensure programmes are made within or
below that budget there is a risk that productions go over budget at some point during the production
13
shed media annua l report  accounts 2008
directors’ report continued
116127 shed pt1  14509  1229 pm  page 13 process to control this risk the group employ skilled production accountants who report into senior
group management on at least a weekly basis any drift over budget can be dealt with quickly to ensure
the overall production budget is adhered to there is also adequate insurance in place for each production
to cover any unforeseen problems that may affect the cost of production such as key cast illnesses or
major equipment failure
4 financial risk management
the board regularly reviews the financial requirements of the group and the risks associated therewith
the group does not use complicated financial instruments and where financial instruments are used it is
for reduced interest or exchange rate risk the group does not trade in financial instruments group
operations are primarily financed from equity funds raised retained earnings and bank borrowings
including overdraft facilities in addition to the primary financial instruments the group also has other
financial instruments such as receivables prepayments payables and accruals that arise directly from the
group’s operations further information is provided in note 16 to the financial statements
directors
the directors of the group are named on page 08 together with brief biographical notes all directors
have been in office for the duration of the year unless stated on page 41 during the year 6 february
2008 ann mcmanus and maureen chadwick resigned from the board katherine innes ker’s appointment
to the board was up for renewal on 18 march 2009 she was not reappointed 
directors’ interests in shares and options
details of directors’ interests in shares and share options can be found in the director’s remuneration
report on pages 19 to 21
retirement and reelections of directors
nicholas southgate eileen gallagher brian park and nicholas powell retire by rotation from office at the
annual general meeting being eligible these directors will offer themselves for reelection in accordance
with the company’s articles of association david kogan will retire from the board at the annual general
meeting
share capital
details of the share capital are shown in note 17 to the financial statements
registrar
the registrar is capita irg plc the registry 34 beckenham road beckenham kent br3 4tu
employees
the group is committed to a policy of equal opportunity in matters relating to employment training and
career development of employees and is opposed to any form of less favourable treatment afforded on
the grounds of disability sex age race or religion
the group encourages the involvement of its employees in its management through regular meetings of
senior management teams which have responsibility for the dissemination of information of particular
concern to employees and for receiving their views on important matters of policy
14
shed media annual report  accounts 2008
directors’ report continued
116127 shed pt1  14509  1229 pm  page 14 the group operates a share option scheme to encourage employees details of this scheme are more fully
described in note 18
political and charitable donations
the group made charitable donations of £1128 and no political contributions in the year 2007 16 months
£nil
trade payables payment policy and practice
it is the group’s policy that payments to suppliers are made in accordance with those terms and conditions
agreed between the group and its suppliers provided that all trading terms and conditions have been
complied with
trade payable days for the group for the year ended 31 december 2008 were 30 days 2007 30 days
based on the ratio of group trade payables at the end of the year to the amounts invoiced during the year
trade payables
corporate governance
detailed statements of the group’s corporate governance and the group’s system of internal control are
set out on pages 17 to 18
the audit committee
the committee comprised during the year the following both of whom are independent nonexecutive
directors katherine innes ker chair david kogan 
the remuneration committee
the committee comprised during the year the following all of whom are independent nonexecutive
directors david kogan chair katherine innes ker
statement as to disclosure of information to auditors 
the directors who were in office on the date of approval of these financial statements have confirmed as
far as they are aware that there is no relevant audit information of which the auditors are unaware each
of the directors have confirmed that they have taken all the steps that they ought to have taken as
directors in order to make themselves aware of any relevant audit information and to establish that it has
been communicated to the auditor
auditors
a resolution to reappoint baker tilly audit uk llp chartered accountants as auditors will be put to the
members at the annual general meeting baker tilly uk audit llp have confirmed their willingness to
continue in office as auditors of the group and a resolution to reappoint them will be proposed at the
annual general meeting
15
shed media annua l report  accounts 2008
directors’ report continued
116127 shed pt1  14509  1229 pm  page 15 annual general meeting
the annual general meeting of the group will be held at 12pm on the 10 june 2009 at the tower room
the old sessions house 22 clerkenwell green london ec1r 0na formal notice of the meeting is
distributed separately
jonathon kemp
financial and commercial director
16
shed media annual report  accounts 2008
directors’ report continued
116127 shed pt1  14509  1229 pm  page 16 the directors support high standards of corporate governance and confirm that they intend to comply
with the requirements of the new “combined code” on corporate governance “the code” published in
june 2008 so far as practicable given the size nature and current stage of the development of the group
the key group objective is to enhance and protect shareholder value
the board of directors
the board consisted of ten directors during the year whose names and details appear on pages 8 to 10
the two nonexecutive directors are considered to be independent of management and free of any
relationship that could materially interfere with the exercise of their independent judgement 
a formal schedule of matters is considered by the board which meets at least 10 times per year and keeps
under constant review the need to hold additional meetings the board is responsible for
• overall group strategy
• acquisitions
• monitoring the operating and financial results against plans and budgets
• ensuring that the necessary financial and human resources are in place for the group to meet its
objectives
• ensuring that the group’s obligations to its shareholders and others are understood and met
the following committees which have written terms of reference deal with specific aspects of the
group’s affairs
audit committee
the audit committee consists of the two nonexecutive directors and meets at least twice a year it is
responsible for ensuring that the financial activities of the group are properly monitored controlled and
reported on it meets the external auditors without executive directors being present and reviews reports
from the auditors
the audit committee recommends the appointment of the external auditors reviews the audit fee and
audit plan and preapproves all nonaudit work in respect of external auditors prior to commitment by the
group
remuneration committee
the remuneration committee consists of two nonexecutive directors it reviews the performance of the
executive directors and sets the scale and structure of their remuneration and that of senior management
and the basis of their service agreements with due regard to the interests of shareholders in determining
the remuneration of the executive directors and senior management the committee seeks to ensure that
the group will be able to attract and retain executives of the highest calibre it makes recommendations to
the full board concerning the allocation of incentive schemes to employees no director participates in
discussions or decisions concerning his own remuneration
further details of the group’s policies on remuneration including details of director’s share options are
given in the report of the remuneration committee report on pages 19 to 21
17
shed media annua l report  accounts 2008
corporate governance report
116127 shed pt1  14509  1229 pm  page 17 nomination committee
the directors consider that given the size of the board nominations should be a matter for the board as a
whole and accordingly there is no separate nomination committee this will be reviewed regularly
internal controls
the directors acknowledge their responsibility for the group’s systems of internal controls and for
reviewing their effectiveness these internal controls are designed to safeguard the assets of the group
and to ensure the reliability of financial information for both internal and external publication the
effectiveness of the system of internal controls has been reviewed by the directors and they are satisfied
the controls are effective with regard to the size of the group and the stage of its development any
system of internal control can only be designed to manage rather than eliminate the risk of failure to
achieve business objectives and can provide reasonable and not absolute assurance against material
misstatement or loss
given the size of the group there is currently not an internal audit function this will be reviewed as the
group grows
relationship with shareholders
the directors attach great importance to maintaining good relationships with shareholders
communications with shareholders are given high priority the directors meet and discuss the
performance of the group with shareholders during the year queries raised by shareholders are promptly
answered by whoever on the board is best placed to do so investors are encouraged to participate in the
annual general meeting at which the chairman will present a review of the results and comment on
current business activity the board will be available at the annual general meeting to answer shareholder
questions
going concern
after making enquiries the directors have reasonable expectation that the company and the group have
adequate resources to continue in operational existence for the foreseeable future and that it is therefore
appropriate to adopt the going concern basis in preparing the financial statements in forming this view the
directors have reviewed the annual profit plan for the year ending 31 december 2008 and strategic plan
projections for subsequent years the directors have satisfied themselves that the group is in a sound
financial position and sufficient borrowing facilities will be available to meet the group’s foreseeable cash
requirements
on behalf of the board
david kogan
18
shed media annual report  accounts 2008
corporate governance report continued
116127 shed pt1  14509  1229 pm  page 18 the following report outlines the group’s policy on the remuneration of executive directors and gives
details of the remuneration packages of executive directors and of the fees paid to nonexecutive
directors for the year ended 31 december 2008 a resolution to approve the report will be proposed at
the annual general meeting of the group the directors have applied the principles of good governance
related to director’s remuneration as described below
remuneration committee
the committee comprised during the year the following all of whom are independent nonexecutive
directors david kogan chair katherine innes ker
remuneration policy
the remuneration policy of the committee and of the board is to provide remuneration packages for the
executive directors and other senior executives in the group which are appropriate to the size and nature
of the group’s business and which will attract and retain high calibre executives it is the group’s policy
that a substantial proportion of the executive directors’ remuneration should be performance related in
order to encourage and reward superior business performance and shareholder return and that
remuneration should be linked to both individual and group performance
accordingly executive directors may earn up to an additional 50 of their basic salaries as a performance
bonus and have benefited from participation in the group’s share option scheme as set out below
it is the policy of the committee and the board to maintain the above approach to remuneration packages
for executive directors and other senior executives of the group for the current financial year and future
financial years subject to review in the light of any changes in relevant legislation regulations or market
practice the committee will continue to review base salaries and performance targets to ensure that they
align with the remuneration policy of the committee and the board and with the group’s strategic
objectives the individual salary bonus and benefit levels of the executive directors’ are and will continue
to be reviewed annually by the committee this year the committee has also undertaken a review of the
longer term remuneration with particular emphasis on selecting longer term incentives
it is the group’s policy to employ executive directors under contracts with an indefinite term subject to
the termination by notice by either party of 12 months any compensation payable by the group would be
subject to normal legal principles of mitigation of loss no compensation would be payable if the service
contracts were to be terminated by notice from the executive director or for lawful termination by the
group there are no provisions for payment of predetermined compensation under the service contracts
in relation to future appointments of executive directors the committee’s and board’s policy will remain
one of restricting notice periods to 12 months
details of individual director’s remuneration is set out on page 41 of this report the main components of
the remuneration for executive directors are
basic salary
the group’s policy is that basic salaries for executive directors should take into account the individual’s
role and responsibilities performance and experience for an executive director who is experienced and
fully effective in his role basic salary is targeted at the retail market median for comparable roles
annual bonus
executive directors are eligible to receive an annual performance bonus up to a maximum of 50 of their
annual basic salaries at the time the bonus scheme is announced the amount of bonus is based on the
19
shed media annua l report  accounts 2008
directors’ remuneration report
116127 shed pt1  14509  1229 pm  page 19 achievement of profit targets specified and agreed at the beginning of the year the performance targets
for bonus entitlements are intended by the remuneration committee to create keen incentives to
perform at the highest levels 
share option schemes
the group has in place an emi scheme under which certain group employees including executive
directors are eligible for the grant of options to acquire ordinary shares in the group further details are in
note 18
share plan
a key element of the group’s retention and reward strategy is to encourage employee share ownership
and facilitate the retention of key staff and talent the group operates a share plan sp to provide
additional share awards to certain employees to reward and motivate existing staff and attract key new
hires the sp will allow participants to acquire shares subject to and to the extent that performance
conditions are satisfied awards in the year are detailed in note 18
other benefits
executive directors are entitled to be provided with private healthcare insurance alexander graham
received a pension in the year
nonexecutive directors
the fees of the nonexecutive directors are determined by the executive members of the board and are
based on market surveys the group’s practice is to appoint nonexecutive directors under letters of
engagement rather than under service contracts these letters of engagement set out fixed terms of
appointment of three years which may be extended with the agreement of the board
executive directors’ service contracts
details of the executive directors’ service contracts are as follows 
date of service
agreement
eileen gallagher 18 february 2005
brian park 18 february 2005
jonathon kemp 18 february 2005
nicholas powell 24 november 2005
nicholas southgate 24 november 2005
chris bonney 28 september 2006
peter caselyhayford 19 september 2007
alexander graham 29 november 2007 
the group may terminate any of the above service contracts by giving not less than 12 months notice any
compensation payable by the group for early termination would be subject to the normal legal principles
of mitigation of loss no compensation would be payable if a service contract were to be terminated by
notice from any of the above directors or for lawful early termination by the group
in concluding the service contracts for the directors the group took into account the provisions of the
combined code regarding notice periods for service contracts in relation to future appointments of
20
shed media annual report  accounts 2008
directors’ remuneration report continued
116127 shed pt1  14509  1229 pm  page 20 executive directors the committee’s and board’s policy will remain one of restricting notice periods of
termination service contracts to twelve months
nonexecutive directors letters of appointment
the group’s practice for the appointment of nonexecutive directors is consistent with the provisions of
the combined code nonexecutive directors are appointed under letters of engagement rather than
under service contracts
details of the nonexecutive directors’ letters of engagement are as follows
date of unexpired term
letter of at the date
engagement of this report
david kogan 18 march 2008 35 months
each letter of appointment is terminable by either party by giving not less than three months notice or by
the group on payment of fees in lieu of notice no compensation would be payable to a nonexecutive
director if hisher engagement were terminated as a result of himher retiring by rotation at an annual
general meeting not being elected or reelected at an annual general meeting or otherwise ceasing to
hold office under the provisions of the articles of association of the group
full details concerning director’s emoluments are disclosed in note 4 to the accounts
approval
this report was approved by the board of directors on 1 april 2009 and signed on its behalf by
david kogan
chair – remuneration committee
21
shed media annua l report  accounts 2008
directors’ remuneration report continued
116127 shed pt1  14509  1229 pm  page 21 the directors are responsible for preparing the annual report and the financial statements in accordance
with applicable law and regulations
uk company law requires the directors to prepare group and company financial statements for each
financial year under that law the directors are required to prepare group financial statements in
accordance with international financial reporting standards “ifrs” as adopted by the eu and have
elected to prepare the company financial statements in accordance with united kingdom generally
accepted accounting practice united kingdom accounting standards and applicable law
the group financial statements are required by law and ifrs adopted by the eu to present fairly the
financial position and performance of the group the companies act 1985 provides in relation to such
financial statements that references in the relevant part of that act to financial statements giving a true
and fair view are references to their achieving a fair presentation
the company and the group financial statements are required by law to give a true and fair view of the
state of affairs of the company and the group 
in preparing each of the group and company financial statements the directors are required to
a select suitable accounting policies and then apply them consistently
b make judgements and estimates that are reasonable and prudent
c for the group financial statements state whether they have been prepared in accordance with ifrss
adopted by the eu and for the company financial statements state whether applicable uk
accounting standards have been followed subject to any material departures disclosed and
explained in the company financial statements
d prepare the financial statements on the going concern basis unless it is inappropriate to presume
that the group and the company will continue in business
the directors are responsible for keeping proper accounting records which disclose with reasonable
accuracy at any time the financial position of the company and the group and to enable them to ensure
that the financial statements comply with the requirements of the companies act 1985 they are also
responsible for safeguarding the assets of the group and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities
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
22
shed media annual report  accounts 2008
statement of directors’ responsibilities
116127 shed pt1  14509  1229 pm  page 22 we have audited the group and parent company financial statements on pages 25 to 70
this report is made solely to the company’s members as a body in accordance with section 235 of the
companies act 1985 our audit work has been undertaken so that we might state to the company’s
members those matters we are required to state to them in an 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
the directors’ responsibilities for preparing the annual report and the group financial statements in
accordance with applicable law and international financial reporting standards ifrss as adopted by the
european union “eu” and for preparing the parent company financial statements in accordance with
applicable law and united kingdom accounting standards united kingdom generally accepted
accounting practice are set out in the statement of directors’ responsibilities 
our responsibility is to audit the financial statements in accordance with relevant legal and regulatory
requirements and international standards on auditing uk and ireland 
we report to you our opinion as to whether the financial statements give a true and fair view and whether
the financial statements have been properly prepared in accordance with the companies act 1985 we also
report to you whether in our opinion the information given in the directors’ report is consistent with the
financial statements
in addition we report to you if in our opinion the company has not kept proper accounting records if we
have not received all the information and explanations we require for our audit or if information specified
by law regarding directors’ remuneration and other transactions is not disclosed
we read other information contained in the annual report and consider whether it is consistent with the
audited financial statements the other information comprises only the directors’ report chairman’s
statement the chief executive’s report the financial review the directors’ remuneration report and the
corporate governance report we consider the implications for our report if we become aware of any
apparent misstatements or material inconsistencies with the financial statements our responsibilities do
not extend to any other information
basis of audit opinion
we conducted our audit in accordance with international standards on auditing uk and ireland issued by
the auditing practices board an audit includes examination on a test basis of evidence relevant to the
amounts and disclosures in the financial statements it also includes an assessment of the significant
estimates and judgements made by the directors in the preparation of the financial statements and of
whether the accounting policies are appropriate to the group’s and company’s circumstances consistently
applied and adequately disclosed
we planned and performed our audit so as to obtain all the information and explanations which we
considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the
financial statements are free from material misstatement whether caused by fraud or other irregularity or
error in forming our opinion we also evaluated the overall adequacy of the presentation of information in
the financial statements
23
shed media annua l report  accounts 2008
independent auditor’s report 
to the members of shed media plc
116127 shed pt1  14509  1229 pm  page 23 opinion
in our opinion
• the group financial statements give a true and fair view in accordance with ifrss as adopted by the
european union of the state of the group’s affairs as at 31 december 2008 and of its profit for the
year then ended
• the parent company financial statements give a true and fair view in accordance with united
kingdom generally accepted accounting practice of the state of the parent company’s affairs as at
31 december 2008
• the financial statements have been properly prepared in accordance with the companies act 1985
and
• the information given in the directors’ report is consistent with the financial statements 
baker tilly uk audit llp 
registered auditor
chartered accountants
2 bloomsbury street
london 
wc1b 3st
1 april 2009
24
shed media annual report  accounts 2008
independent auditor’s report 
to the members of shed media plc continued
116127 shed pt1  14509  1229 pm  page 24 16 months
year ended ended
31 december 31 december
2008 2007
notes £’000 £’000
revenue 1 81944 63108
cost of sales 50988 39662
––––––––––––––––––––––––––––––––
gross profit 30956 23446
––––––––––––––––––––––––––––––––
general administrative expenses 15922 12189
ifrs 2 sharebased payment 518 240
amortisation of intangibles arising on 
business combinations 2167 484
––––––––––––––––––––––––––––––––
total administrative expenses 18607 12913
––––––––––––––––––––––––––––––––
operating profit 12349 10533
finance income 3 394 228
finance costs 3 3291 1313
fair value loss on financial instruments 3 1595 –
––––––––––––––––––––––––––––––––
net finance costs 4492 1085
––––––––––––––––––––––––––––––––
profit before taxation 2 7857 9448
tax expense 5 2455 3078
––––––––––––––––––––––––––––––––
profit for the yearperiod attributable 
to equity holders of the parent 5402 6370
––––––––––––––––––––––––––––––––
earnings per share
basic pence 7 685p 966p
diluted pence 7 677p 955p
all transactions arise from continuing operations
the accompanying accounting policies and notes form an integral part of these financial statements
25
shed media annua l report  accounts 2008
consolidated income statement
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 25 2008 2007
notes £’000 £’000
noncurrent assets
goodwill 8 61306 61537
other intangible assets 9 24542 24430
property plant and equipment 10 1270 1403
––––––––––––––––––––––––––––––––
87118 87370
––––––––––––––––––––––––––––––––
current assets
trade and other receivables 11 18711 17843
cash and cash equivalents 8953 6559
––––––––––––––––––––––––––––––––
27664 24402
––––––––––––––––––––––––––––––––
total assets 114782 111772
–––––––– ––––––––
–––––––– ––––––––
current liabilities
borrowings 11266 10679
loan notes issued – 4010
accruals and deferred income 16442 8959
trade and other payables 2425 3803
current tax liabilities 15 370
deferred consideration 4327 1311
––––––––––––––––––––––––––––––––
13 34475 29132
––––––––––––––––––––––––––––––––
noncurrent liabilities
longterm borrowings 21337 26400
deferred tax liabilities 4830 3633
deferred consideration – 5574
derivatives and financial instruments 1595 –
––––––––––––––––––––––––––––––––
14 27762 35607
–––––––– ––––––––
–––––––– ––––––––
total liabilities 62237 64739
––––––––––––––––––––––––––––––––
net assets 52545 47033
–––––––– ––––––––
–––––––– ––––––––
equity
calledup share capital 17 80 79
share premium account 19 28740 28241
share option reserve 971 453
treasury shares 450 450
retained earnings 23204 18710
––––––––––––––––––––––––––––––––
total equity attributable to equity 
shareholders of the parent 52545 47033
–––––––– ––––––––
–––––––– ––––––––
the financial statements were approved by the board of directors and authorised for issue on 1 april 2009
and signed on its behalf by
nicholas southgate jonathon kemp
chief executive financial director
the accompanying accounting policies and notes form an integral part of these financial statements
26
shed media annual report  accounts 2008
consolidated balance sheet
at 31 december 2008
116127 shed pt2  14509  118 pm  page 26 share
based
ordinary share treasury payment retained
shares premium shares reserve earnings total
£’000 £’000 £’000 £’000 £’000 £’000
balance at 1 september 2006 60 9990 – 213 13083 23346
profit for the period –––– 6370 6370
tax recognised directly in equity –––– 70 70
——————————————————————————————
total recognised income and 
expense for the period –––– 6440 6440
issue of equity shares 19 18251 – – – 18270
share based payments ––– 240 – 240
purchase of own shares – – 450 – – 450
dividends –––– 813 813
——————————————————————————————
balance at 31 december 2007 79 28241 450 453 18710 47033
——————————————————————————————
balance at 1 january 2008 79 28241 450 453 18710 47033
profit for the year –––– 5402 5402
——————————————————————————————
total recognised income and 
expense for the year –––– 5402 5402
issue of equity shares 1 499 – – – 500
share based payments ––– 518 – 518
deferred tax –––– 39 39
dividends –––– 869 869
——————————————————————————————
balance at 31 december 2008 80 28740 450 971 23204 52545
——————————————————————————————
27
shed media annua l report  accounts 2008
consolidated statement of changes in equity
year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 27 year ended 16 months  ended
31 december 31 december
2008 2007 
£’000 £’000
cash flows from operating activities
profit before taxation 7857 9448
adjustments for
depreciation and amortisation 7375 3562
ifrs 2 share based payment 518 240
foreign exchange gainloss 462 67
fair value loss on a financial instrument 1595 –
discounted deferred consideration 325 –
investment income 394 228
interest expense 2966 1313
increase in trade and other receivables 533 2772
increase in trade payables 6012 5130
––––––––––––––––––––––––––––––––
cash generated from operations 25259 6500
––––––––––––––––––––––––––––––––
taxation paid 1747 2141
––––––––––––––––––––––––––––––––
net cash from operating activities 23512 4359
––––––––––––––––––––––––––––––––
cashflows from investing activities
acquisitions of subsidiaries net of cash acquired 5840 29083
purchase of intangible assets 6850 3461
purchase of property plant and equipment 511 4311
interest received 394 228
interest paid 2966 1313
––––––––––––––––––––––––––––––––
net cash used in investing activities 15773 37940
––––––––––––––––––––––––––––––––
cash flows from financing activities
proceeds from issues of share capital – 450
net repayment ofproceeds from borrowings 4476 34772
dividends paid 869 813
––––––––––––––––––––––––––––––––
net cash used ingenerated from financing activities 5345 33509
––––––––––––––––––––––––––––––––
net increasedecrease in cash and cash equivalents 2394 72
cash and cash equivalents at start of yearperiod 6559 6631
––––––––––––––––––––––––––––––––
cash and cash equivalents at end of yearperiod 8953 6559
––––––––––––––––––––––––––––––––
the accompanying accounting policies and notes an integral part of these financial statements
28
shed media annual report  accounts 2008
consolidated cash flow statement
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 28 nature of operations and general information
the principal activity of shed media plc and its subsidiaries the group is the production of programmes
for the television industry in the united kingdom and the united states and the worldwide acquisition and
distribution of rights in programmes produced by the group companies as well as programmes produced
by third party clients
shed media plc is the group’s ultimate parent company it is incorporated and domiciled in england and
wales  the address of shed media plc’s registered office which is also its principal place of business is
2 holford yard london wc1x 9hd shed media plc’s shares are listed on the alternative investment
market aim of the london stock exchange 
basis of preparation
the financial statements have been prepared under the historic cost convention as modified by the
revaluation of derivative financial instruments and as required by eu law the group’s accounts have been
prepared and approved by the directors in accordance with international financial reporting standards as
adopted by the eu “ifrs” the group’s consolidated financial statements were prepared in accordance
with united kingdom accounting standards united kingdom generally accepted accounting practice
until 31 december 2007 the date of transition to ifrs was 1 september 2006 the comparative figures in
respect of the previous financial period have been presented to reflect the changes in accounting policies
as a result of the adoption of ifrs
the parent company’s loss for the year ending 31 december 2008 is £2m 2007 16 months profit after tax
of £2m the directors have taken advantage of the exemption available under section 230 of the
companies act 1985 and not presented the profit and loss account for the company alone the company
has elected to prepare its parent company financial statements in accordance with uk generally accepted
accounting practice
ifrs 1 permits companies adopting ifrs for the first time to take certain exemptions from the full
requirements of ifrs in the transition period these consolidated financial statements have been prepared
taking the following exemptions
• business combinations prior to 1 september 2006 the group’s date of transition to ifrs have not
been restated to comply with ifrs 3 business combinations goodwill arising from these business
combinations of £279m has not been restated
ifrs 8 “operating segments” has been adopted for the first time for the year ended 31 december 2008
operating segments are reported in a manner consistent with the internal reporting provided to the chief
operating decisionmaker the chief operating decisionmaker  who is responsible for allocating resources
and accessing performance and accessing performance of the operating segments has been identified as
the board of directors
at the date of authorisation of these financial statements the following standards and interpretations
relevant to the company operations that have been applied in these financial statements were in issue but
not yet effective or endorsed unless otherwise stated 
• ifrs 2 share based payment – amendments relating to vesting conditions and cancellations 
• ifrs 3 business combinations – amendments 
• ifrs 7 financial instruments disclosures – consequential amendments arising from amendments to
las 32 
• las i presentation of financial statements – revised 
29
shed media annua l report  accounts 2008
notes to the consolidated financial statements
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 29 • las 1 presentation of financial statements amendments relating to puttable financial instruments
and obligations arising on liquidation 
• las 23 borrowing costs – amendment 
• las 27 consolidated and separate financial statements – consequential amendments arising from
amendments from tfrs 3 
• las 28 investments in associateconsequential amendments arising from amendments to ifrs 3 
• las 31 interest in joint ventures – consequential amendments arising from amendments to ifrs 3 
• las 32 financial instruments presentation – amendments relating to puttable financial instruments
and obligations arising on liquidation 
• las 39 financial instruments recognition and measurement – consequential amendments arising
from amendments to las 32
• ifric 11 ifrs 2 – group and treasury share transactions endorsed 
• ifric 12 service concession arrangements
• ifric 13 customer loyalty programmes 
• ifric 14 las 19 the limit on a defined benefit asset minimum funding requirements and their
interaction annual improvements project 
the directors anticipate that the adoption of these standards and interpretations as appropriate in future
periods will have no material impact on the financial statements of the company
the principal accounting policies of the group are set out below and have been applied consistently in
presenting the consolidated financial information
basis of consolidation
consolidated financial statements include the financial statements of shed media plc and all its subsidiary
undertakings the results of subsidiary undertakings acquired or disposed of during the year are accounted
for in the income statement from or up to the date that control passes intercompany sales and profits
are eliminated on consolidation
subsidiaries are entities that are directly or indirectly controlled by the group control exists where the
group has the power to govern the financial and operating policies of the entity so as to obtain benefits
from its activities in assessing control potential voting rights that are currently exercisable or convertible
are taken into account
the purchase method of accounting is used to account for the acquisition of subsidiaries by the group
the cost of an acquisition is measured as the fair value of the assets given equity instruments issued and
liabilities incurred or assumed at the date of exchange plus costs directly attributable to the acquisition
identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are
measured initially at their fair values at the acquisition date irrespective of the extent of any minority
interest the excess of the cost of acquisition over the fair value of the group’s share of the identifiable net
assets acquired is recorded as goodwill if the cost of acquisition is less than the fair value of the net assets
of the subsidiary acquired the difference is recognised directly in the income statement
all intragroup transactions and balances are eliminated on consolidation
30
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 30 principal accounting policies
the group financial statements consolidate those of the company and its subsidiary undertakings drawn
up to 31 december 2008 the following policies have been applied consistently across the group
business combinations completed prior to the date of transition of ifrs
the group has elected not to apply ifrs 3 business combinations retrospectively to business combinations
prior to 1 september 2006
accordingly the classification of the acquisition of ricochet limited remains unchanged from that used
under uk gaap assets and liabilities are recognised at the date of transition and are measured using their
uk gaap carrying amount immediately postacquisition as deemed cost under ifrs deferred tax is
adjusted for the impact of any consequential adjustments after taking advantage of the transitional
provisions
revenue
revenue represents amounts receivable for work carried out in producing television programmes and is
recognised on the basis of the value of costs related to production activity revenue also includes sums
receivable from the exploitation of programmes in which the group owns rights gross profit on
production activity is recognised based upon the stage of completion of the production and in accordance
with the underlying contract
for distribution income the amount recognised in the income statement represents the value of the
licence fees including withholding tax but excluding value added tax
distribution income is recognised when
– an agreement is contracted
– the arrangement is fixed and determinable
– and for finished programme sales when the programme is delivered
operating profit
operating profit is derived as profit from operations before finance income historic costs and income tax
expense
property plant and equipment and depreciation
property plant and equipment is stated at cost net of depreciation and any provision for impairment
depreciation is provided on all property plant and equipment at rates calculated to write each asset down
to its estimated residual value evenly over its expected useful life as follows–
fixtures fittings  equipment 25 straight line
computer equipment 33 straight line
edit suites 20 straight line
leasehold improvements over the life of the lease
intangible assets
goodwill and business combinations
goodwill arising from business combinations is capitalised and subject to an annual impairment review in
accordance with ias36
31
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 31 the fair value of intangible assets acquired as a result of business combinations is capitalised and amortised
on a straight line basis through the income statement the rates applicable which represent the best
estimate of the useful economic life are
customer relationships 10 years
trademarks 15 years
format rights backlog 2 years
format rights recommissions 2 years
other intangible assets
for programme assets amortisation is provided in accordance with the income forecast method whereby
amortisation is taken to the income statement on a pro rata basis calculated as the income received in the
accounting period in relation to the expected revenue over the life of the programme
development expenditure
development expenditure has been written off as incurred unless the directors are satisfied as to the
technical commercial and financial viability of individual projects in this situation the development
expenditure is capitalised and amortised in line with the revenue generated
impairment of assets 
for the purpose of assessing impairment assets are grouped at the lowest levels for which there are
separately identifiable cash flows cashgenerating units as a result some assets are tested individually for
impairment and some are tested at the cashgenerating unit level goodwill is allocated to those cash
generating units that have arisen from business combinations and represent the lowest level within the
group at which management monitors the related cashflows
goodwill other individual assets or cashgenerating units that include goodwill other intangible assets with
an indefinite useful life and those tangible assets not yet available for use are tested for impairment at
least annually all other individual assets or cashgenerating units are tested for impairment whenever
events or changes in circumstances indicate that the carrying amount may not be recoverable
an impairment loss is recognised for the amount by which the asset’s or cashgenerating units carrying
amount exceeds its recoverable amount the recoverable amount is the higher of fair value reflecting
market conditions less costs to sell and value in use based on internal discounted cashflow evaluation
impairment losses recognised for cashgenerating units to which goodwill has been allocated are credited
initially to the carrying amount of goodwill any remaining impairment loss is charged pro rata to the other
assets in the cash generating unit with the exception of goodwill all assets are subsequently reassessed for
indications that an impairment loss previously recognised may no longer exist
cash and cash equivalents
cash and cash equivalents comprise cash in hand and deposits held at call with banks and other shortterm
highly liquid investments with original maturities of three months or less
trade receivables
trade receivables are initially recognised at fair value and subsequently measured at their amortised cost
using the effective interest method less any provision for impairment trade receivables due in more than
one year are discounted to their present value
trade payables
trade payables are initially recognised at fair value and subsequentially at amortised cost using the
effective interest method
32
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 32 bank borrowings
interest bearing bank loans and overdrafts are initially recorded at the proceeds received net of direct
issue costs and are subsequently measured at amortised cost using the effective interest method finance
charges including premiums payable on settlement or redemption and direct issue costs are accounted for
on an effective interest method and are added to the carrying amount of the instrument to the extent
that they are not settled in the period in which they arise
current and deferred taxation
current tax is the tax currently payable on taxable profit for the year
deferred 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 bases used in the computation
of taxable profit and is accounted for using the balance sheet liability method deferred tax liabilities are
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 the initial
recognition of goodwill or from the initial recognition other than in a business combination of other
assets and liabilities in a transaction which affects neither the tax profit nor the accounting profit
deferred 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 deferred tax is calculated at the tax rates that are expected to apply to the period
when the asset is realised or the liability is settled based upon tax rates that have been enacted or
substantively enacted by the balance sheet date deferred tax is charged or credited in the income
statement except when it relates to items credited or charged directly to equity in which case the
deferred tax is also dealt with in equity
leased assets
leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are
classified as operating leases and the payments made under them are charged to the income statement on
a straight line basis over the lease term
equity
equity comprises the following
• share capital represents the nominal value of equity shares
• share premium represents the excess over nominal value of the fair value of consideration receive
for equity shares net of the expenses of the share issue
• share option reserve represents the cumulative balance of ifrs 2 share based payments
• treasury shares represent shed media plc shares purchased by the parent company and held in
trust
• retained earnings represent cumulative retained profit and losses
financial instruments
financial assets and liabilities are recognised when the group becomes a party to the contractual provision
of the instrument
33
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 33 foreign currencies
transactions in foreign currencies are translated at the exchange rate ruling at the date of the transaction
or the contracted date monetary assets and liabilities in foreign currencies are translated at rates of
exchange ruling at the balance sheet date all other exchange differences are dealt with through the
income statement
equity instruments
equity instruments issued by the group are recorded at the proceeds received net of direct issue costs
share based payments
the group issues equitysettled sharebased payments to certain employees equitysettled sharebased
payments are measured at fair value excluding the effect of non marketbased vesting conditions 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 the shares that
will eventually vest
fair value is measured using a blackscholes valuation 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
provisions contingent liabilities and contingent assets
where the deferred consideration is dependent upon future trading performance an estimate of the
present value of the likely consideration payable is made this contingent deferred consideration is re
assessed annually and a corresponding adjustment is made to the goodwill arising on acquisition the
difference between the present value and the total amount payable at a future date gives rise to a finance
charge which is charged to the income statement and credited to the liability over the period in which the
consideration is deferred the discount used is the prevailing rate of return on borrowings
foreign currency translation
a functional and presentation currency
items included in the financial statements of each of the group’s entities are measured using the
currency of the primary economic environment in which the entity operates ‘the functional
currency’ the consolidated financial statements are presented in ‘sterling’ £ which is the
company’s functional and the group’s presentation currency
b transactions and balances
foreign currency transactions are translated into the functional currency using the exchange rates
prevailing at the dates of the transactions or valuation where items are remeasured foreign
exchange gains and losses resulting from the settlement of such transactions and from the
translation at yearend exchange rates of monetary assets and liabilities denominated in foreign
currencies are recognised in the income statement except when deferred in equity as qualifying
cash flow hedges and qualifying net investment hedges
foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are
presented in the income statement within ‘finance income or cost’ all other foreign exchange gains
and losses are presented in administrative expenses in the income statement 
34
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 34 c group companies
the results and financial position of all the group entities none of which has the currency of a
hyperinflationary economy that have a functional currency different from the presentation
currency are translated into the presentation currency as follows
i assets and liabilities for each balance sheet presented are translated at the closing rate at the
date of that balance sheet
ii income and expenses for each income statement are translated at average exchange rates
unless this average is not a reasonable approximation of the cumulative effect of the rates
prevailing on the transaction dates in which case income and expenses are translated at the
rate on the dates of the transactions and
iii all resulting exchange differences are recognised as a separate component of equity
goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as
assets and liabilities of the foreign entity and translated at the closing rate
derivative financial instruments 
derivatives are initially recognised at fair value on the date a derivative contract is entered into and are
subsequently remeasured at their fair value the method of recognising the resulting gain or loss depends
on whether the derivative is designated as a hedging instrument and if so the nature of the item being
hedged where derivative instruments do not qualify for hedge accounting changes in the fair value of any
these derivative instruments are recognised immediately in the income statement 
significant judgements and estimates
the preparation of consolidated financial statements under ifrs requires the group to make estimates
and assumptions that affect the application of policies and reported amounts estimates and judgements
are continually evaluated and are based on historical experience and other factors including expectations
of future events that are believed to be reasonable under the circumstances actual results may differ
from these estimates the estimates and assumptions which have a significant risk of causing material
adjustment to the carrying amount of assets and liabilities are discussed below
intangible assets
the group recognises intangible assets acquired as part of business combinations at fair value at the date
of acquisition the determination of these fair values is based upon management’s judgement and includes
assumptions of the timing and the amount of future incremental cashflows generated by the assets and
selection of an appropriate cost of capital furthermore management must estimate the useful lives of
intangible assets and charge amortisation on these assets accordingly
impairment of goodwill 
the group is required to test at least annually whether goodwill has suffered any impairment the
recoverable amount is determined based on value in use calculations the use of this method requires the
estimation of future cash flows and the choice of a suitable discount rate in order to calculate the present
value of these cash flows actual outcomes could vary
depreciation of property plant and equipment
depreciation is provided so as to write down the assets to the residual values over their estimated useful
life as set out above the selection of these estimated lives requires the exercise of management
judgement
35
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 35 deferred consideration
where deferred consideration is payable in cash and discount would have a material effect the liability is
discounted to its present value where the deferred consideration is contingent and dependent upon
future trading performance an estimate of the present value of the likely consideration payable is made
where a business combination agreement provides for an adjustment to the cost that is contingent on
future events contingent consideration is included in the cost of an acquisition if the adjustments is
probable that is more likely than not and can be measured reliably 
36
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 36 1 segmental analysis
management has determined the operating segments based on the reports reviewed by the board that are
used to make strategic decisions
the board considers the business by type of revenue and geographic location the group primarily
operates through its offices in london and brighton uk and in los angles usa but sells the rights to its
programmes worldwide the group differentiates between newly commissioned production revenue both
in the uk and the us and revenue arising from the sale of the rights of the group’s library intellectual
property ip revenue
central costs segment represents the cost of the head office function this operates as an independent
function to the trading businesses 
the board assesses the performance of the operating segments based on a measure of adjusted ebitda
for the year ending 31 december 2008
broadcaster broadcaster
uk us ip central total
£’000 £’000 £’000 £’000 £’000
revenue 43105 21671 21489 – 86265
less intersegment sales – – 4321 – 4321
total revenue from third parties 43105 21671 17168 – 81944
cost of sales 35137 12286 3565 – 50988
gross profit 7968 9385 13603 – 30956
general administrative expenses 11100 2773 1172 758 15803
adjusted ebitda 3132 6612 12431 758 15153
depreciation 460 74 – 103 637
adjusted ebita 3592 6538 12431 861 14516
less amortisation of intangibles arising 
on business combinations 2021 – 146 – 2167
total operating profitloss 5613 6538 12285 861 12349
finance income 174 – – 220 394
finance costs 38 – – 3253 3291
fair value loss on financial instruments – – – 1595 1595
net finance incomecosts 136 – – 4628 4492
profit before taxation 5477 6538 12285 5489 7857
tax expense 115 403 3501 1564 2455
profit for the year attributable to equity 
holders of the parent 5592 6135 8784 3925 5402
total amortisation charge 6592 – 146 – 6738
segment assets 96093 3019 10365 5305 114782
segment liabilities 10153 2290 9283 40511 62237
segment net assets 85940 729 1082 35206 52545
37
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 37 1 segmental analysis continued
for the period ending 31 december 2007
broadcaster broadcaster
uk us ip central total
£’000 £’000 £’000 £’000 £’000
revenue 34734 15471 14315 – 64520
less inter segment sales – – 1412 – 1412
total revenue from third parties 34734 15471 12903 – 63108
cost of sales 27208 9292 3162 – 39662
gross profit 7526 6179 9741 – 23446
general administrative expenses 7926 1579 1066 1502 12073
adjusted ebitda 400 4600 8675 1502 11373
depreciation 237 – – 119 356
adjusted ebita 637 4600 8675 1621 11017
less amortisation of intangibles arising
on business combinations 302 – 182 – 484
total operating profitloss 939 4600 8493 1621 10533
finance income – – – 228 228
finance costs – – – 1313 1313
net finance costs – – – 1085 1085
profit before taxation 939 4600 8493 2706 9448
tax expense 228 964 2767 881 3078
profit for the period attributable to equity
holders of the parent 1167 3636 5726 1825 6370
total amortisation charge 3024 – 182 – 3206
segment assets 93931 3006 7577 7258 111772
segment liabilities 6454 3342 6560 48383 64739
segment net assets 87477 336 1017 41125 47033
broadcaster uk revenues of approximately £32209000 75 of total in 2008 and £29858000 86
total were derived from a single customer in 2007
broadcaster us revenues of approximately £12241000 56 of total in 2008 £10050000 65 total
were derived from a single customer in 2007 
38
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 38 2 profit before taxation
the profit before taxation is stated after chargingcrediting
16 months 
year ended ended
31 december 31 december
2008 2007
£’000 £’000
cost of sales
production costs 29335 22990
film asset amortisation 4413 2315
staff salaries charged to productions 15354 11326
distribution 3565 3162
administration
auditor’s remuneration
– fees payable for the audit of the company’s annual accounts 58 110
– fees payable for the audit of the company’s subsidiaries 188 150
– tax compliance 71 76
– other advisory services – 112
salaries 8813 7900
ifrs 2 share option charge 518 240
depreciation and amortisation
– plant property and equipment owned 637 356
– amortisation of intangibles 2167 484
– amortisation of other intangibles 158 407
operating lease rentals – property rents 928 719
foreign exchange differences 462 67
national insurance rebate – 165
3 finance income and costs
the finance income and costs comprise
16 months 
year ended ended
31 december 31 december
2008 2007
£’000 £’000
interest receivable on cash deposits 394 228
interest payable on borrowings 2966 1313
discounting deferred consideration 325 –
fair value loss on financial instruments – interest rate collar 1595 –
4492 1085
39
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 39 4 staff numbers and costs
staff costs including directors charged to cost of sales during the yearperiod were as follows
16 months 
year ended ended
31 december 31 december
2008 2007
£’000 £’000
wages 13961 10126
social security costs 1393 1200
share based payments – –
15354 11326
staff costs including directors charged to overheads during the yearperiod were as follows
16 months 
year ended ended
31 december 31 december
2008 2007
£’000 £’000
wages 7659 7068
social security costs 1112 832
pension costs 42 –
share based payments 518 240
9331 8140
the average number of employees of the group during the yearperiod was
16 months 
year ended ended
31 december 31 december
2008 2007
no no
production 323 147
administration 241 274
564 421
40
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 40 4 staff numbers and costs continued
directors’ emoluments for the year ended 31 december 2008 are detailed below
total
remuneration
year ended
31 december
salariesfees bonuses benefits 2008
££££
executive directors
nicholas southgate 215375 – 520 215895
jonathon kemp 165375 – 318 165693
eileen gallagher 165375 – 450 165825
brian park 165375 – 683 166058
ann mcmanus 16448 – – 16448
maureen chadwick 16448 – – 16448
nicholas powell 165375 50000 1818 217193
peter caselyhayford 135000 – 1605 136605
chris bonney 147673 – 1359 149032
alexander graham 135737 – 2588 138325
nonexecutive directors
katherine innes ker 60000 – – 60000
david kogan 35000 – – 35000
total 1423181 50000 9341 1482522
directors’ emoluments for the 16 months ended 31 december 2007 are detailed below
total
remuneration
16 months
ended
31 december
salariesfees bonuses benefits 2007
££££
executive directors
nicholas southgate 239563 50000 1192 290755
jonathon kemp 207208 50000 375 257583
eileen gallagher 213250 50000 415 263665
brian park 213250 50000 777 264027
ann mcmanus 213250 50000 699 263949
maureen chadwick 213250 50000 1013 264263
nicholas powell 213250 50000 1192 264442
peter caselyhayford 33750 – 132 33882
chris bonney 159879 – 2088 161967
alexander graham 11158 – 178 11336
nonexecutive directors
katherine innes ker 80600 – – 80600
david kogan 47267 – – 47267
total 1845675 350000 8061 2203736
 resigned from the board 6 february 2008 remuneration is disclosed for the period from 1 january 2008 to 5 february
2008
 appointment to the board was up for renewal 18 march 2009 she was not reappointed
41
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 41 4 staff numbers and costs continued
directors’ pensions entitlements
the group has made pension contributions on behalf of alexander graham totalling £2578 2007 £257
share options
no 2007 nil share options were exercised in the period by directors
key management
the group considers the key management and personnel to be represented by the board of directors
staff costs relating to key management charged during the yearperiod were as follows
16 months 
year ended ended
31 december 31 december
2008 2007
£’000 £’000
wages 1473 2196
social security costs 189 281
benefits 98
share based payments 170 145
1841 2630
42
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 42 5 tax expense
the taxation charge represents
16 months 
year ended ended
31 december 31 december
2008 2007
£’000 £’000
tax charge– income statement
current tax
corporation tax 1775 2722
overseas taxation 528 283
adjustments in respect of prior years 1006 707
total current tax 1297 2298
deferred tax
origination and reversal of timing differences 234 94
adjustments in respect of prior years 924 686
total deferred tax 1158 780
total tax charge – income statement 2455 3078
tax charge – reservesequity
current tax
share based payments – 14
deferred tax
share based payments 39 70
total tax charge – reservesequity 39 56
43
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 43 5 tax expense continued
the tax assessed for the year is higher than the standard rate of corporation tax in the uk the differences
are explained below
16 months 
year ended ended
31 december 31 december
2008 2007
£’000 £’000
profit before tax
profit before tax multiplied by the average standard rate of corporation tax 
in the uk of 285 2007  30 2239 2834
effects of
expenses not deductible for tax purposes 175 274
transfer pricing adjustments 31 –
losses not recognised 24 –
film tax credit 126 –
marginal relief 8 1
difference in overseas tax rates 214 76
impact of change in current tax rates compared to deferred tax rates 12 84
net adjustments in respect of prior periods 82 21
total tax charge for period 2455 3078
comprising
deferred tax charge 1145 784
current tax charge 1310 2294
effective tax rate 312 326
6 dividends
16 months 
year ended ended
31 december 31 december
2008 2007
£’000 £’000
equity dividends
paid during the year 869 813
the final dividend of 11p per ordinary share proposed at 31 december 2007 of £869000 was paid to
shareholders on 18 july 2008 registered at the close of business on 20 june 2008
44
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 44 7 earnings per share
basic earnings per share are calculated by dividing the earnings attributable to ordinary shareholders by the
weighted average number of ordinary shares in issue during the period the weighted average number of
shares has been adjusted for the issue of shares during the year and for treasury shares held
for diluted earnings per share the weighted average number of ordinary shares in issue is adjusted to
assume conversion for all dilutive potential ordinary shares these represent share options granted to
employees where the exercise price is less than the average market price of the group’s ordinary shares
the table below sets out the adjustments in respect of diluted potential ordinary shares
2008 2007
number number
of shares of shares
weighted average number of shares used in basic earnings 
per share calculation 78886358 65964663
dilutive share options and shares plans 868464 735300
weighted average number of shares used in diluted earnings 
per share calculation 79754822 66699963
the adjusted eps has been calculated to reflect the underlying profitability of the business by excluding
the effect of amortisation of intangible assets arising on business combinations discounting deferred
consideration and fair value loss on financial instruments
the diluted adjusted earnings per share calculation has been made to allow shareholders to gain a better
understanding of the trading performance of the group it is based on the diluted earnings per share
calculation above except that profits are adjusted for the same items above as follows
16 months 
year ended ended
31 december 31 december
2008 2007
£’000 £’000
profit on ordinary activities after taxation attributable to shareholders 5402 6370
amortisation of intangible assets 2167 484
discounting deferred consideration 325 –
fair value loss on financial instruments 1595 –
taxation impact of above items 1145 145
adjusted profit on ordinary activities after taxation 8344 6709
2008 2007
pence pence
basic earnings per share 685p 966p
diluted earnings per share 677p 955p
adjusted basic earnings per share 1058p 1017p
adjusted diluted earnings per share 1046p 1006p
45
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 45 8 goodwill
total
£’000
cost
at 1 september 2006 27940
additions in the period 33597
at 1 january 2008 61537
adjustments to goodwill detailed below 231
at 31 december 2008 61306
goodwill arising on acquisition after the date of transition to ifrs is attributable to operational synergies
and earnings potential expected to be over the longer term the main changes in carrying amounts of
goodwill result from the revisions to deferred consideration as shown below
increase
decrease
in deferred
2007 consideration 2008
£’000 £’000 £’000
twenty twenty television limited 14934 891 14043
outright distribution limited 2269 6 2275
wall to wall holdings limited 16394 654 17048
ricochet limited 27940 – 27940
at 31 december 61537 231 61306
the recoverable amount of the cash generating units was determined based on valueinuse calculations
using actual operating results and a one year’s detailed forecast followed by an extrapolation of expected
cash flows at a growth rate of 225 at a pretax discount rate of 101 for 10 years detailed forecasts are
generally appropriate for one year due to the short term nature of the commissioning market
twenty twenty television limited achieved lower than expected business in the year which has led to this
company not meeting the required targets for deferred consideration the directors believe that the
downturn in business during this year is short term due to changes in key personnel they believe this will
not have a long term effect and that twenty twenty television limited will recover a level of commissions
in line with the forecasts as a result no impairment of goodwill has been taken
46
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 46 9 intangible assets
format
other customer format rights
programme intangible trade relation rights recom
assets assets marks ships backlog missions total
£’000 £’000 £’000 £’000 £’000 £’000 £’000
cost
at 1 september 2006 12064 756 –––– 12820
additions 7622 875 5051 6100 1246 1194 22088
disposals – 311 –––– 311
at 1 january 2008 19686 1320 5051 6100 1246 1194 34597
additions 6600 250 –––– 6850
disposals 1288 ––––– 1288
at 31 december 2008 24998 1570 5051 6100 1246 1194 40159
amortisation
at 1 september 2006 6955 26 –––– 6981
amortisation 2315 407 46 248 76 114 3206
disposals – 20 –––– 20
at 1 january 2008 9270 413 46 248 76 114 10167
amortisation 4413 158 337 610 623 597 6738
disposals 1288 ––––– 1288
at 31 december 2008 12395 571 383 858 699 711 15617
nbv
at 1 september 2006 5109 730 –––– 5839
at 1 january 2008 10416 907 5005 5852 1170 1080 24430
at 31 december 2008 12603 999 4668 5242 547 483 24542
other intangible assets relate to investments in productions these are internally generated assets and are
not considered material for separate disclosure and website development cost
the carrying value of all intangible assets is reviewed biannually for impairment based on the assumptions
made at the date of acquisition currently no intangible assets are considered to be impaired
47
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 47 10 property plant and equipment
fixtures  fittings 
£’000
cost
at 1 september 2006 732
additions 740
arising on acquisitions 597
disposals 111
at 1 january 2007 1958
additions 511
disposals 46
at 31 december 2008 2423
depreciation
at 1 september 2006 286
provided in the period 356
on disposals 87
at 1 january 2007 555
provided in the year 637
on disposals 39
at 31 december 2008 1153
net book amount at 31 december 2008 1270
net book amount at 31 december 2007 1403
net book amount at 31 august 2006 446
48
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 48 11 trade and other receivables
2008 2007
£’000 £’000
trade receivables 9655 7015
other receivables 831 1577
prepayments and accrued income 8225 9251
18711 17843
the age of financial assets past due but not considered impaired is as follows
2008 2007
£’000 £’000
not more than 3 months 1207 396
more than 3 months but less than 6 months 484 62
more than 6 months but less that 1 year 80 71
more than 1 year 62 79
1833 608
movement on the group provision for impairment of trade receivables is a follows
2008 2007
£’000 £’000
provision for receivables impairment at beginning of yearperiod 160 –
new provision in the yearperiod 156 160
provision for receivables impairment at end of yearperiod 4 160
the creation and release of the provision for impaired receivables have been included in the income
statement the other classes within trade and other receivables do not contain impaired assets the
provision during the year related to receivables considered unlikely to be recovered the maximum
exposure to credit risk at the reporting date is set out below the group does not hold any collateral as
security
the directors consider that the carrying amount of trade and other receivables approximates to their fair
value
the group’s maximum exposure to credit risk is detailed below
2008 2007
£’000 £’000
trade receivables 9655 7015
other receivables 831 1577
accrued income 7552 8646
total 18038 17238
49
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 49 12 deferred taxation
deferred tax provided for in the financial statements is set out below
analysis of opening liability
2008 2007
£’000 £’000
opening liability at 1 january 2008 3633 204
deferred tax charge for yearperiod recognised in income statement 1158 780
deferred tax charge for yearperiod recognised in equity 39 70
arising on acquisitions – 2719
closing liability at 31 december 2008 4830 3633
analysis of closing liability
accelerated capital allowances 178 41
film assets 2495 969
losses carried forward – 924
customer relationships 3062 3669
share options 126 102
timing differences relating to losses on financial derivatives 455 –
other timing differences 32 20
4830 3633
13 current liabilities
2008 2007
£’000 £’000
bank loan and overdraft 11266 10679
loan notes – 4010
trade and other payables 2425 3803
current tax payables 15 370
accruals and deferred income 16442 8959
deferred consideration on acquisition of subsidiary note 15 4327 1311
34475 29132
the bank loans and overdraft are secured by a fixed and floating charge over the group’s assets 
the directors consider that the carrying amounts of trade and other payables approximate to fair value
50
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 50 14 noncurrent liabilities
2008 2007
£’000 £’000
bank loan note 13 21337 26400
deferred tax liabilities 4830 3633
deferred consideration on acquisition of subsidiary note 15 – 5574
derivatives and financial instruments 1595 –
27762 35607
15 deferred consideration on the acquisition of a subsidiary
current noncurrent
liabilities liabilities total
£’000 £’000 £’000
opening position 1 january 2008 1311 5574 6885
utilised in the year 1311 1572 2883
unwinding of discount on deferred consideration – 325 325
transfer to current from non current liabilities 4327 4327 –
balance at 31 december 2008 4327 – 4327
16 financial instruments
the group is exposed to market risk through its use of financial instruments and specifically to currency
risk interest rate risk and certain other price risks which result from both its operating and investing
activities the group’s risk management is coordinated at its headquarters in close cooperation with the
board and focuses on actively securing the group’s short to medium term cash flows by minimising the
exposure to financial markets long term financial investments are managed to generate lasting returns
the group does not actively engage in the trading of financial assets for speculative purposes nor does it
write options the most significant financial risks to which the group is exposed are described below
the table below on the next page analyses the group’s financial liabilities based on the nominal balance as
at 31 december 2008 and 31 december 2007 to the contractual maturity date
51
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 51 16 financial instruments continued
the amounts disclosed are based on contractual undiscounted cash flows
less than one to two to 
one year two years five years total
£’000 £’000 £’000 £’000
31 december 2008
production funding 1500 – – 1500
borrowing principal payments 6928 6943 17710 31581
interest payments 2239 1654 1586 5749
interest rate collar – – 1595 1595
trade payables 1702 – – 1702
other payables 15305 – – 15305
31 december 2007
production funding 5489 – – 5489
borrowing principal payments 5487 6928 19042 31457
loan notes 4011 – – 4011
interest payments 3291 2239 3239 8769
trade payables 1702 – – 1702
other payables 18038 – – 18038
as at 31 december 2008 there is a working capital loan of £2945360 which is repayable on demand as per
the loan agreement within the table above £736340 of this loan is included in one to two years and
£2209020 is included within two to five years there are no balances within 2007
treasury policy and financial risk management
the group treasury department operates within risk management policies approved by the board and its
procedures are reviewed regularly major transactions are authorised outside the department at the
requisite level and there is an appropriate segregation of duties frequent reports are made to the
commercial and financial director and regular reports are prepared for the board
the group’s financial instruments as well as derivatives are made up of borrowings cash and liquid
resources and other items such as receivables and payables that arise directly from its operations
in order to manage the interest rate and currency risk arising from the group’s operations and financing
the group treasury department also enters into derivative transactions these are mainly interest rate
collars and forward currency contracts currently all derivatives are disclosed as cash flow hedges and
variations in value are reflected in the income statement
it is the group’s policy not to engage in speculative transactions
the main risks are liquidityfunding risk interest rate risk and foreign currency risk
52
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 52 16 financial instruments continued
liquidityfunding risk
the group finances it operations through a mixture of advances from broadcasters retained profit and
bank borrowings the group has a working capital facility to finance production costs where broadcasters
do not provide advances
the group’s objective is to secure continuity of funding at a reasonable cost the group seeks to manage
financial risk by ensuring sufficient liquidity is available to meet foreseeable needs and to invest cash assets
safely and profitably the group manages liquidity risk by a combination of controls
– regular reviews at board level of cash flow projections headroom position in respect of banking
facilities and adherence to parameters within the loan covenants
– maintaining reasonable gearing levels across the group
– ensuring short term borrowing facilities are readily accessible for short term flexibility
the group will continue to use internally a range of ratios to monitor and manage its finances these
include interest cover of ebitda net debt to operating profit and cash flow to debt measures at
31 december 2008 the total facility available amounted to £366m £286m on facility a and £8m on
facility b
interest rate risk 
bank borrowings are mostly held at variable interest rates based on relevant london interbank offered
rate libor to the reference drawdown period borrowings to finance production costs are held at either
variable interest rates based on barclay’s bank rate or as a fixed fee as part of a coproducer agreement
interest income and costs are dependent upon the funding requirements of the group and the prevailing
market interest rates the group’s exposure to interest rate fluctuations on its borrowings is managed by
entering into structured collar agreements offsetting borrowings on floating rate basis
this caps the highest level of libor interest at 575 if libor falls below 399 interest is payable at
double the difference between libor and 399 up to a maximum of 575
as the group hedges interest with an interest collar it is not significantly sensitive to changes in interest
rates from the perspective of interest payments to the bank however the fair value of the interest rate
collar is sensitive to changes in interest rate a 1 decrease in libor would lead to a £642000 increase in
the fair value of the interest rate collar liability a 1 increase in libor would lead to a £684000 decrease
in the fair value of the interest rate collar liability as the interest rate collar is not compliant with hedge
accounting these movements will be recognised within the income statement
interest rate profile of financial assets and liabilities
financial assets
the group’s financial assets comprise cash held in current accounts on which interest is receivable at a rate
of 01
currency risk
the group is based in the uk and has investments in overseas operations the most significant currencies
for the group are the us dollar and the euro
the group has overseas subsidiaries operating in the usa whose revenue and expenses are denominated
in us dollars where the group is anticipating receipts in excess of expenses forward contracts are put
into place
53
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 53 16 financial instruments continued
in addition about 77 of the group’s sales from exploitation of programme rights are to customers in
continental europe and other foreign markets these sales are priced and invoiced either in the currencies
of the customers involved or in us dollars where the group has receivables denominated in us dollars
from the exploitation of programme rights forward contracts are set up as far as it is practicable to do so
in respect of timing of receipts the group’s policy on routine transactional conversions between
currencies 
for example the collection of receivables and the settlement of payables or interest is that these should
be completed at the relevant spot exchange rate the majority of our operations are domestic within the
country of operation no unremitted profits are hedged with foreign exchange contracts as the group
judges it inappropriate to hedge noncash flow translational exposure with cash flow instruments
the group’s gross profit is sensitive to changes in foreign exchange rates a 1 increase in the average
foreign exchange rate for the year would lead to a £06m decrease in gross profit and a 1 decrease in the
average foreign exchange rate for the year would lead to a £07m increase in gross profit other amounts
in the income statement are materially unaffected by changes in foreign exchange rates this is because
material foreign exchange movements result from trading in the us which is viewed as an extension of uk
trading
the tables below show the extent to which the group has monetary assets and liabilities in currencies
other than pounds sterling which is regarded as the functional currency of the group foreign exchange
rate differences on retranslation of these assets and liabilities are taken to the income statement of the
group
2008 2007
£’000 £’000
net foreign currency monetary assets
us dollar 7639 1519
other currencies 7 408
7646 1927
the amounts shown in the table above take into account the effect of any forward contracts entered into
to manage these currency exposures
counterparty risk
the group’s risk of loss on deposits or derivative contracts is limited to the lender bank and its managed
by use of counterparty limits these limits are approved by the commercial and financial director within
guidelines approved by the board
credit risk
credit risk arises from cash and cash equivalents derivative financial instruments deposits with bank and
financial institutions and accounts receivable the group has no significant concentration of credit risk
the group’s exposure to credit related losses in the event of nonperformance by counterparties to
financial instruments is mitigated by limiting exposure to any one party of instrument and ensuring only
counterparties with defined credit risk parameters are used
54
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 54 17 share capital
the share capital of shed media plc consists of ordinary shares with a par value of 001p each all shares are
equally eligible to receive dividends and the repayment of capital and represent one vote at shareholders’
meetings
2008 2007
£’000 £’000
allotted called up and fully paid
79716502 ordinary shares of 001p each 2007 78970292 ordinary 
share of 001 each 80 79
authorised
105000000 ordinary shares at 001p each 2007 80000000 ordinary
shares at 001p each 105 80
a summary of movements from 1 september 2006 is detailed below
no of shares £
at 1 september 2006 59916944 59917
25 september 2006 – issue of shares for outright limited acquisition 772200 772
31 october 2006 – issue of shares for ricochet limited earn out 4335570 4336
19 september 2007 – issue of shares for twenty twenty productions
limited acquisition 5033168 5033
29 november 2007 – issue of shares for wall to wall holdings limited acquisition 8912410 8912
at 31 december 2007 78970292 78970
16 september 2008 issue of shares for outright limited earn out 746210 746
at 31 december 2008 79716502 79716
18 share options
the group has a share option scheme for directors and employees details of options granted are as
follows
at
at granted in the 31 december
31 december 2007 period 2008
options over options over options over date from
ordinary shares ordinary shares ordinary shares which expiry exercise
of 01p each of 01p each of 01p each exercisable date price
57000 – 57000 140305 140315 01p
179959 – 179959 140307 140315 88p
179959 – 179959 140308 140315 88p
47874 – 47874 010505 010515 01p
25000 – 25000 251107 251115 88p
25000 – 25000 251108 251115 88p
28500 – 28500 250508 250515 1255p
28500 – 28500 250509 250516 1255p
185000 – 185000 251107 251116 107p
60250 – 60250 281208 281217 155p
60250 – 60250 281209 281218 155p
877292 – 877292
55
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 55 18 share options continued
the weighted average exercise price at the beginning and end of period was 93p
a charge has been made in the year £42000 2007 16 months £107000 to reflect the fair value to the
group of issuing employee share options this charge has been calculated by applying a fair value to the
options issued and spreading the charge equally over the vesting period which is typically 3 years from
issue the fair value has been calculated using the blackscholes model and the weighted average inputs
the charge for the year was calculated using the blackscholes option pricing model using the following
inputs
31 december 2008
expected volatility 239
expected life years 5
risk free rate 54
expected volatility was determined by calculating the historical volatility of the group’s share price from
listing on 29 march 2005 to the date of grant of the options 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
a risk free rate of 54 per cent has been used which reflects the interest rate that it is assumed can be
obtained by investing in financial instruments with no default risk
no share options were exercised during the year
own shares held in trust
on 17 august 2007 the group purchased £450000 of its own shares this equated to 456496 shares with
a purchase value of 985p
share plan sp
at 31 december 2008 the following shares were granted through the share plan
date of grant
exercise
price no of shares
1 september 2005 0p 255046
1 september 2006 0p 201450
1 september 2007 0p 495082
shares are available from 3 years from the date of grant at the option of the holder
a charge has been made in the year £475000 2007 16 months £133000 to reflect the fair value to the
group of issuing the performance share plan shares
the share price at 31 december 2008 was 61p and the highest and the lowest share prices during the year
ended 31 december 2008 were 82p and 54p respectively
56
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 56 19 share premium account
£’000
at 1 september 2006 9990
shares allotted in the period 18251
at 1 january 2008 28241
shares allotted in the year 499
at 31 december 2008 28740
20 capital commitments
the group and company had no capital commitments at 31 december 2008 or 31 december 2007
21 related party transactions
at 31 december 2008 the group owed alexander graham £466456 2007 £815973 due to additional
consideration relating to an acquired tax asset on the wall to wall holdings limited acquisition this will be
paid as the tax asset is utilised
22 leasing commitments
the minimum lease rentals to be paid under non cancellable operating leases at 31 december 2008 was as
follows 
land and land and
buildings buildings
2008 2007
£’000 £’000
in one year or less 790 502
between one and five years 2109 2012
in five years or more 259 353
3158 2867
57
shed media annua l report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 57 23 sale and leaseback transactions
the group has entered into various sale and leaseback transactions on television programmes amounts
are held on deposit accounts as a result of these transactions and comprise money to provide for the
discharge of future leasing liabilities the banks with which these sums are deposited have given guarantees
to the lessors in respect of lease liabilities a liability would only crystallise upon the failure of the bank
holding the deposit this is considered remote and therefore these balances have not been included with
in the group’s balance sheet the amounts involved are as follows
2008 2007
£’000 £’000
amounts held on deposit 17997 20207
less loans outstanding 17997 20207
––
the maturity of the above amount is as follows
less than one year 2210 2210
two to five years 9621 9621
over five years 6166 8376
17997 20207
58
shed media annual report  accounts 2008
notes to the consolidated financial statements continued
for the year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 58 as stated in the basis of preparation on page 29 these are the group’s first ifrs annual consolidated
financial statements prepared in accordance with ifrs
ifrs 1 permits companies adopting ifrs for the first time to take certain exemptions from the full
requirements of ifrs in the transition period these consolidated financial statements have been prepared
on the basis of taking the following exemptions
– business combinations prior to 1 september 2006  the group’s transition to ifrs have not been
represented to comply with ifrs 3 “business combinations” goodwill arising from these business
combinations of £2794m has not been represented
detailed explanations of how the transition from uk gaap to ifrs has affected the group’s financial
position financial performance and cashflows are set out in the following notes
notes to the reconciliation of equity at 1 september 2006
see notes on page 62
uk gaap a d ifrs
£’000 £’000 £’000 £’000
noncurrent assets
goodwill 27940 – – 27940
other intangible assets – 5839 – 5839
property plant and equipment 5789 5343 – 446
current assets
inventories 203 203 – –
trade and other receivables 9222 293 – 8929
cash and cash equivalents 6631 – – 6631
current liabilities
borrowings 8500 – – 8500
accruals and deferred income 4157 – – 4157
trade and other payables 8102 – – 8102
current tax payable 401 – – 401
noncurrent liabilities
deferred tax 323 – 44 279
deferred consideration on the acquisition 
of a subsidiary 5000 – – 5000
–––––––––—————–––––––––––––––––––––––
net assets 23302 – 44 23346
–––––––––––—————–––––––––––––––––––––
equity
share capital 60 – – 60
share premium account 9990 – – 9990
share option reserve 213 – – 213
retained earnings 13039 – 44 13083
–––––––––—————–––––––––––––––––––––––
total equity 23302 – 44 23346
–––––––––—————–––––––––––––––––––––––
59
shed media annua l report  accounts 2008
explanation of transition to ifrs
116127 shed pt2  14509  118 pm  page 59 reconciliation of equity at 31 december 2007
see notes on page 62
uk gaap a b c d ifrs
£’000 £’000 £’000 £’000 £’000 £’000
noncurrent assets
goodwill 68804 – 7267 – – 61537
other intangible assets – 11323 13107 – – 24430
property plant and equipment 12383 10980 – – – 1403
current assets
trade and other receivables 18186 343 – – – 17843
cash and cash equivalents 6559 –––– 6559
current liabilities
borrowings 10679 –––– 10679
loan notes issued 4010 –––– 4010
accruals and deferred income 8849 – – 110 – 8959
trade and other payables 3803 –––– 3803
current tax payable 370 –––– 370
deferred consideration on the 
acquisition of a subsidiary 1311 1311
noncurrent liabilities
long term borrowings 26400 –––– 26400
deferred tax 97 – 3669 31 102 3633
deferred consideration on the 
acquisition of a subsidiary 5574 –––– 5574
—————————–––––––––––—————–––––––––––––––––––––
net assets 44839 – 2171 79 102 47033
—————————–––––––––––—————–––––––––––––––––––––
equity
share capital 79 –––– 79
share premium account 28241 –––– 28241
share option reserve 453 –––– 453
treasury shares 450 –––– 450
retained earnings 16516 – 2171 79 102 18710
—————————–––––––––––—————–––––––––––––––––––––
total equity 44839 – 2171 79 102 47033
—————————–––––––––––—————–––––––––––––––––––––
60
shed media annual report  accounts 2008
explanation of transition to ifrs continued
116127 shed pt2  14509  118 pm  page 60 reconciliation of profit for the sixteen months ended 31 december 2007
see notes on page 62
uk gaap a b c d ifrs
£’000 £’000 £’000 £’000 £’000 £’000
revenue 63108 –––– 63108
cost of sales 37347 –––– 37347
amortisation of programme assets 2315 –––– 2315
—————————–––––––––––—————–––––––––––––––––––––
total cost of sales 39662 –––– 39662
—————————–––––––––––—————–––––––––––––––––––––
gross profit 23446 ––––23446
—————————–––––––––––—————–––––––––––––––––––––
administrative expenses 11702 –––– 11702
goodwill amortisation 2520 – 2520 – – –
ifrs 2 share based payments 240 –––– 240
amortisation of intangibles 378 – 484 – – 862
holiday pay accrual – – – 109 – 109
—————————–––––––––––—————–––––––––––––––––––––
total administrative expenses 14840 – 2036 109 – 12913
—————————–––––––––––—————–––––––––––––––––––––
operating profit 8606 2036 109 – 10533
—————————–––––––––––—————–––––––––––––––––––––
finance income 228 –––– 228
finance cost 1313 –––– 1313
—————————–––––––––––—————–––––––––––––––––––––
profit before taxation 7521 – 2036 109 – 9448
—————————–––––––––––—————–––––––––––––––––––––
income tax expense 3231 – 136 31 14 3078
—————————–––––––––––—————–––––––––––––––––––––
profit after taxation 4290 – 2172 78 14 6370
—————————–––––––––––—————–––––––––––––––––––––
61
shed media annua l report  accounts 2008
explanation of transition to ifrs continued
116127 shed pt2  14509  118 pm  page 61 notes to the reconciliations
a – ias 38 defines an intangible asset as an identifiable nonmonetary asset without physical substance
software costs websites generated in house and programme assets previously stated as tangible assets
under uk gaap have consequently been restated as intangible assets development costs have also been
restated as intangible assets having previously being classified as a receivable 
b – the group acquired outright distribution limited on 25 september 2006 twenty twenty
productions limited on 19 september 2007 and wall to wall holdings ltd on 29 november 2007
application of ifrs 3 to these business combinations resulted in the identification of a number of
intangible assets including
trade names
production rights – backlog
production rights – recommissions
customer relationships
under ifrs these have been recognised separately in the balance sheet at their fair value at the date of the
combination under uk gaap these intangible assets were subsumed within goodwill the result of this
adjustment is detailed in the table below
other ifrs
goodwill intangibles total
£’000 £’000 £’000
opening balance at 1st sept 2006 27940 – 27940
goodwill arising on acquisitions under uk gaap for the
sixteen months ending december 2007 43383 – 43383
transfer to intangibles under ifrs 13591 13591 –
deferred tax adjustments 3805 – 3805
intangibles amortisation for the 16 months ending 
31 december 2007 – 484 484
––—————–––––––––––––––––––––
at 31 december 2007 61537 13107 74644
––—————–––––––––––––––––––––
intangible assets identified on this business combination in accordance with ifrs as described above are
amortised in accordance with the accounting policy explained on page 29 
c – ias 19 “employee benefits” requires that an accrual is made for outstanding holiday balances due but
not taken at the balance sheet date this accrual has been estimated as follows 31 december 2008 £82000
and 31 december 2007 – £109000
d – under frs 19 deferred tax was recognised only on timing differences in contrast ias 12 “income
taxes” requires the recognition of deferred tax on all temporary differences deferred tax and current tax
adjustments relating to a b or c have been adjusted within the relevant category d relates to deferred tax
adjustments in respect of share based payments
there were no changes to the cashflow other than presentational as a result of the transition
62
shed media annual report  accounts 2008
explanation of transition to ifrs continued
116127 shed pt2  14509  118 pm  page 62 2008 2007
notes £’000 £’000
fixed assets
tangible assets 3 915 995
investments 4 78499 78730
––––––––––––––––––––––––––––––––
79414 79725
current assets
debtors 5 3950 5595
cash at bank and in hand 642 697
––––––––––––––––––––––––––––––––
4592 6292
creditors amounts falling due within one year 6 15095 16118
––––––––––––––––––––––––––––––––
net current liabilities 10503 9826
––––––––––––––––––––––––––––––––
total assets less current liabilities 68911 69899
creditors amounts falling due after 
more than one year 7 21337 26400
provisions for liabilities 8 4279 6891
––––––––––––––––––––––––––––––––
net assets 43295 36608
–––––––– ––––––––
–––––––– ––––––––
capital and reserves
called up share capital 9 80 79
share premium account 10 28740 28241
share scheme 971 453
treasury shares 450 450
profit and loss account 11 13954 8285
––––––––––––––––––––––––––––––––
equity shareholders’ funds 43295 36608
–––––––– ––––––––
–––––––– ––––––––
the financial statements were approved on behalf of the board of directors and authorised for issue on 1
april 2009 and signed on its behalf by
jonathon kemp nick southgate
financial and commercial director chief executive officer
the accompanying accounting policies and notes form an integral part of these financial statements
63
shed media annua l report  accounts 2008
company balance sheet
as at 31 december 2008
116127 shed pt2  14509  118 pm  page 63 accounting policies
the principal accounting policies which have been consistently applied in the company’s financial
information throughout the period under review are as follows
basis of accounting
the financial information has been prepared under the historical cost convention and in accordance with
applicable accounting standards in the united kingdom 
development expenditure
development expenditure has been written off as incurred unless the directors are satisfied as to the
technical commercial and financial viability of individual projects in this situation the development
expenditure is deferred
tangible fixed assets
tangible fixed assets are stated at historical cost
depreciation is provided on all tangible fixed assets at rates calculated to write each asset down to its
estimated residual value evenly over its expected useful life as follows–
fixtures fittings  equipment 25 straight line
computer equipment 33 straight line
operating leases
rental payments under operating leases are charged to the profit and loss account on a straight line basis
over the period of the lease
going concern
the directors regularly review that the company has adequate resources to continue in operational
existence for the foreseeable future and that it is therefore appropriate to adopt the going concern basis
in preparing the financial statements see corporate governance statement for additional information
investments
fixed asset investments are stated at cost less any provision for diminution in value
foreign currencies
assets and liabilities denominated in foreign currencies are translated into sterling at the rates of exchange
ruling at the balance sheet date transactions in foreign currencies are translated into sterling at the rate of
exchange ruling at the date of the transaction exchange differences are taken to the profit and loss
account for the year
deferred taxation
deferred tax is recognised in respect of all timing differences that have originated but not reversed at the
balance sheet date where transactions or events that result in an obligation to pay more tax in the future
or a right to pay less tax in the future have occurred at the balance sheet date timing differences are
differences between the company’s taxable profits and its results as stated in the financial statements that
arise from the inclusion of gains and losses in tax assessments in periods different from those in which they
are recognised in the financial statements
64
shed media annual report  accounts 2008
company accounting policies
for year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 64 deferred tax is measured at the average tax rates that are expected to apply in the periods in which timing
differences are expected to reverse based on tax rates and laws that have been enacted or substantially
enacted by the balance sheet date deferred tax is measured on a nondiscounted basis
deferred consideration 
where the deferred consideration is dependent upon future trading performance an estimate of the
present value of the likely consideration payable is made this contingent deferred consideration is
reassessed annually and a corresponding adjustment is made to goodwill arising on acquisition the
difference between the present value and the total amount payable at a future date gives rise to a finance
charge which is charged to the profit and loss account and credited to the liability over the period in which
the consideration is deferred 
deferred financing costs
bank arrangement fees and associated legal costs are amortised over the term of the debt facility
sharebased payment
the company has adopted financial reporting standard frs20 sharebased payments in the current
year frs20 requires the recognition of a charge for sharebased payment transactions which include for
example share options granted to employees that require a certain length of service before vesting
equity settled sharebased payments are measured at fair value at the date of grant the fair value
determined at the grant date of equitysettled sharebased payments is expensed on a straightline basis
over the vesting period based on the company’s estimate of shares that will eventually vest the fair value
is measured by use of the blackscholes option pricing model the expected life used in the model has
been adjusted based on managements best estimate for the effect of nontransferability exercise
restrictions and behavioural considerations
65
shed media annua l report  accounts 2008
company accounting policies continued
for year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 65 1 profit for the financial year
the company has taken advantage of section 230 of the companies act 1985 and has not included its own
profit and loss account in these financial statements the group profit for the year includes a profit of
£6538000 2007 16 months profit of £1804000 in relation to the company this does not include the
interest rate collar of £1595000 which is an ifrs adjustment and therefore not applicable under uk
gaap
2 dividends
2008 2007
£’000 £’000
equity dividends
paid during the year 869 813
3 tangible fixed assets 
fixtures  fittings
£’000
cost
at 1 january 2008 1425
additions 106
at 31 december 2008 1531
depreciation
at 1 january 2008 430
charge for the year 186
at 31 december 2008 616
net book amount at 31 december 2008 915
net book amount at 31 december 2007 995
4 fixed asset investments
interests in
subsidiary
undertakings
£’000
cost and net book amount
at 1 january 2008 78730
adjustments note 8 – page 40 231
at 31 december 2008 78499
66
shed media annual report  accounts 2008
notes to the company financial statements
for year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 66 4 fixed asset investments continued
details of principal investments are below 
 ownership
name principal activity ordinary shares
shed productions productions limited television production 100
ricochet limited television production 100
twenty twenty productions ltd television production 100
outright distributions ltd distribution 100
wall to wall holdings ltd television production 100
shed media usa inc television production 100
shed media scotland ltd television production 100
 registered in england and wales
 registered in united states of america
5 debtors
2008 2007
£’000 £’000
trade debtors 320 132
amounts owed by group undertakings 2395 3820
other debtors 335 946
prepayments and accrued income 698 670
corporation tax 202 27
3950 5595
6 creditors amount falling due within one year
2008 2007
£’000 £’000
bank loan 9766 5190
loan notes – 4010
trade creditors 10 98
other creditors 36 315
other taxes and social security 244 79
amounts owed to group companies 4729 5672
accruals 310 754
15095 16118
7 creditors amounts falling due after one year
2008 2007
£’000 £’000
bank loan 21337 26400
bank loan is disclosed in detail within group notes – notes 13 and 16
67
shed media annua l report  accounts 2008
notes to the company financial statements continued
for year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 67 8 provisions for liabilities
deferred deferred
consideration taxation total
£’000 £’000 £’000
opening position 1 january 2008 6885 6 6891
utilised in the year 2883 – 2883
chargecredit to profit for the year 325 54 271
balance at 31 december 2008 4327 48 4279
deferred tax assetliability
31 december 31 december 
2008 2007
£’000 £’000
accelerated capital allowances 3 6
film asset 59 –
share options 110 –
deferred tax assetliability 48 6
provisionasset at start of period 6 70
net deferred tax creditcharge in profit and loss account for the period 54 76
assetprovision at end of period 48 6
deferred consideration is disclosed in detail within group notes – note 15
9 share capital
the share capital of shed media plc consists of ordinary shares with a par value of 001p each all shares are
equally eligible to receive dividends and the repayment of capital and represent one vote at shareholders’
meetings
2008 2007
£’000 £’000
allotted called up and fully paid
79716502 ordinary shares of 001p each 2007 78970292 
ordinary share of 001 each 80 79
authorised
105000000 ordinary shares at 001p each 2007 80000000 
ordinary shares at 001p each 105 80
68
shed media annual report  accounts 2008
notes to the company financial statements continued
for year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 68 9 share capital continued
a summary of movements from 1 september 2006 is detailed below
no of shares
at 1 september 2006 59916944
25 september 2006 – issue of shares for outright limited acquisition 772200
31 october 2006 – issue of shares for ricochet limited earn out 4335570
19 september 2007 – issue of shares for twenty twenty productions limited acquisition 5033168
29 november 2007 – issue of shares for wall to wall holdings limited acquisition 8912410
at 31 december 2007 78970292
16 september 2008 issue of shares for outright limited earn out 746210
at 31 december 2008 79716502
10 share premium 
share premium account
£’000
at 1 january 2008 28241
on shares issued in the year 499
at 31 december 2008 28740
69
shed media annua l report  accounts 2008
notes to the company financial statements continued
for year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 69 11 reconciliation of movements in shareholders’ funds
share profit 
called up premium share treasury and loss
share capital account scheme shares account total
£’000 £’000 £’000 £’000 £’000 £’000
shareholders’ funds at 1 october 2006 60 9990 213 – 7294 17557
profit for the financial year –––– 1804 1804
dividend paid –––– 813 813
treasury shares – – – 450 – 450
shares issued 19 –––– 19
premium on issue of shares – 18251 – – – 18251
share scheme charge – – 240 – – 240
shareholders’ funds at 31 december 2007 79 28241 453 450 8285 36608
share profit 
called up premium share treasury and loss
share capital account scheme shares account total
£’000 £’000 £’000 £’000 £’000 £’000
shareholders’ funds at 1 january 2008 79 28241 453 450 8285 36608
profit for the financial year –––– 6538 6538
dividend paid note 2 –––– 869 869
shares issued 1 –––– 1
premium on issue of shares – 499 – – – 499
share scheme charge – – 518 – – 518
shareholders’ funds at 31 december 2008 80 28740 971 450 13954 43295
12 related party transactions
the company has taken advantage of the exemption in frs 8 – related party transactions not to disclose
transactions between group companies
at 31 december 2008 the company owed alexander graham £466456 due to additional consideration
relating to an acquired tax asset on the wall to wall acquisition this will be paid as the tax asset is utilised
70
shed media annual report  accounts 2008
notes to the company financial statements continued
for year ended 31 december 2008
116127 shed pt2  14509  118 pm  page 70 we believe in open dialogue with all our stakeholders and welcome you to contact us directly
registered office
2 holford yard
london
wc1x 9hd
company registration number
03617464
company secretary
kirsten spurr
44 020 7239 1010
investor relationspress
nick lyon
hudson sandler
44 020 7796 4133
interim chairman
david kogan
nonexecutive director
david kogan
bankers
barclays bank plc
27 soho square
london w1d 3qr
auditors
baker tilly uk audit llp
2 bloomsbury street
london
wc1b 3st
71
shed media annua l report  accounts 2008
contacts and company information
sterling 116127
116127 shed pt2  14509  118 pm  page 71 116127 shed pt2  14509  118 pm  page b 116127 shed pt2  14509  119 pm  page c


Summary:
 shed has again delivered an excellent set of results for the year to 31 december 2008 the group has
successfully integrated its acquisitions outright distribution twenty twenty and wall to wall and
continued to grow organically 
during the year revenue from the group’s core activities content production and ip exploitation has
increased to £82m 2007 16 months £63m of particular importance was the growing revenue stream
from the us that now makes up 30 2007 16 months 26 of group gross profit the group has
maintained its excellent adjusted operating margins of 18 2007 16 months 17 a final dividend has
been proposed of 125p per ordinary share 2007 11p this dividend will also be available to shareholders
as a scrip issue of ordinary shares
whilst the uk production market is challenging shed is benefiting from its ability to produce longrunning
returnable brands for its broadcast partners of particular note are the popular bbc one drama series
new tricks and waterloo road and the factual shows who do you think you are and the choir 
with uk produced content and formats still leading the world outright distribution continues to capture
more profit growth from group and third party product the group library has expanded to over 2900
hours and is selling into over 200 territories at a time when international broadcasters are looking to cut
their original content spend having such a quality catalogue has given shed media a significant competitive
advantage
during the year eileen gallagher decided to step down as group chief executive i am delighted that
eileen remains on the board as chief executive of shed productions eileen is a tremendous asset to the
group having led shed through a successful ipo and delivering on the strategy to diversify and strengthen
the group through acquisitions i would like to take this opportunity to thank eileen for her leadership to
date
the board welcomed the appointment of nick southgate to the role of group chief executive nick in his
previous role of chief operating officer led the integration of the group companies and the expansion
into america and is extremely well placed to drive shed forward 
i would also like to thank katherine innes ker for her contribution as chair over the last four years the
group is in the process of identifying a new chair and two non executive directors and we hope to make a
further announcement shortly
finally the content produced and distributed by the group in 2008 is the product of many hardworking
individuals and i’d like to thank all of our employees for their efforts during the year
david kogan
02
shed media annual report  accounts 2008
chairman’s statement
116127 shed pt1  14509  1229 pm  page 02