shiloh plc report and accounts 20032004 our aim is to develop innovative long term mutually
beneficial partnerships with healthcare providers in the
supply of continence care mobility and rehabilitation
prevention of infection and wound management
partnerships that will add value through the supply
distribution and brand development of the products
and services we provide
1 highlights
2 shiloh overview
4 chairman’s statement 
6 chief executive’s review 
8 board of directors and advisers
9 report of the directors
11 corporate governance and directors’ responsibilities
13 directors’ remuneration report
14 report of the independent auditors
15 consolidated profit and loss account
16 balance sheets
17 consolidated cash flow statement
18 consolidated statement of total recognised gains and losses
19 notes to the accounts
32 financial record
33 notice of meeting
medical  
•
active care  
•
sterilisation services
contents highlights
• shortlisted for contracts in the first
wave of the nhs decontamination
programme 
• nhs national wipes contract 
renewed for 4 years
• investment of £400k in new wipes
machine to generate significant savings
• over £900k sales from the higher
margin comfi bandage and clinisan 
skin cleansing ranges
• major cost savings in home delivery
achieved following strategic review
• net new business of over £500k for
wheelchair service and repair contracts
• three surplus properties sold at profit 
of £367k
• closure of five poorly performing
active care sites 
• net borrowings reduced by £796k 
to £154m
full year full year
2004 2003
turnover £4512m £4544m
operating profit £043m £123m
profit before tax £031m £049m
earnings per share 303p 462p
dividend per share
– final 385p 385p
– total 535p 535p
1
† excluding discontinued activities and before exceptional items and amortisation
† shiloh has three distinct 
interrelated divisions
overview
medical
the medical division focuses primarily on disposable products for use within the nhs acute and primary care sectors
and also the private healthcare sector  it provides product and service solutions for continence care infection
prevention and wound management
shiloh is best known as a leading manufacturer and supplier to both the nhs and private sector of the conti range of
patient cleansing wipes as the only manufacturer of shaped pads in the uk branded contisure shiloh has over 20
home delivery contracts throughout the uk delivering the company’s products direct to patients’ homes product
delivery is supported by a modern it system enabling products to be delivered to
patients’ homes direct to the nhs to the private healthcare sector or to ward
level in scotland through shiloh’s own distribution business fastaid
within the infection prevention portfolio the clinisan range of skin cleansing
products has been strengthened with the addition of smaller can sizes and
complements the continence care system whilst at the same time helping to
control mrsa in the fight against infection
the comfi range of tubular bandages marked shiloh’s first move into the wound management arena and comfi is
now on nhs contract in england scotland and wales with a dedicated team targeting the community market comfi
is now listed on many primary care trust formularies both comfi and roho pressure care products complement our
offering to tissue viability nurses vacutex a capillaryaction primary dressing has recently been added to the range
other healthcare products include alcohol wipes disposable gowns facemasks protective clothing for the workplace
and cotton wool our simply gentle organic cotton wool brand is manufactured and supplied to some of the major
retail outlets throughout the country and is fully compliant with the soil association organic standard
2 active care
the rebranding and consolidation of the mobility and rehabilitation businesses
acquired and built since 2000 continues shiloh active care is committed to
helping people lead more active lives – whatever their age or situation it does
this through the provision of high quality mobility and rehabilitation
products services and aftercare support
the division operates a number of assessment centres across the uk – many
of which are attached to service centres for nhs contracts the division has
been successful in being awarded new nhs wheelchair services contracts in
lancashire and northern ireland with dedicated service and assessment centres 
being established in preston and belfast to support these
shiloh active care’s product range is now a common offering throughout the uk and includes wheelchairs scooters
hoists beds pressure relief products specialist seating and aids for daily living the division works in partnership with
key suppliers including sunrise medical and has exclusive distribution agreements with sumed and roho for seating
and pressure relief products
most of shiloh active care’s sales are to the nhs or social services through a combination of product and service
contracts these products and services are also available to individual customers through our network of assessment
centres and a specialist mail order catalogue
shiloh active care is well positioned to provide a competitive high quality service in a traditionally fragmented market
and help make life a little easier for the elderly and disabled
sterilisation services
shiloh’s sterilisation services division was established seven years ago as a new concept for the decontamination of
surgical instruments in the private sector it operates from custombuilt sterilisation facilities at strathclyde business
park lanarkshire supporting hospitals across central scotland
the department of health has publicly acknowledged that in the years ahead the need for fullycompliant
decontamination facilities across the uk will increase and that private sector companies are expected to provide a
significant number of those facilities accordingly in june 2003 it published a strategy for modernising the provision of
decontamination services and has since embarked on the nhs decontamination programme for england
using its experience of operating a modern offsite facility that is strictly compliant with european regulations the
division is committed to further expansion of this successful area of activity to take full advantage of the opportunities
arising from the decontamination programme 
3 overview
the result for the year is disappointing and does not
reflect the tremendous energy and effort involved in re
positioning the group as a leading supplier of products
and services to the national health service and the private
healthcare market 
the cost and time taken to make the necessary changes
to reposition the group have been much greater than
expected  in particular the restructuring of our four
mobility acquisitions into one division shiloh active care
has proved a costly exercise and has had a significant
negative impact on operating profit
the medical division has had a year of mixed fortunes
our glasgow based distribution operation fastaid
products has again turned in an excellent performance
but the main oldhambased operation has been adversely
affected by the costs involved in restructuring and
changing the product mix  we have withdrawn from
some low margin business and started to build up a range
of higher margin products most notably our comfi
bandage range of woundcare products and the clinisan
brand of emollient cleansing foam these two products
have resulted in new sales of over £900000 which have
replaced nearly £2 million of low margin business mainly
in workwear
under these circumstances the group has done well to
maintain sales at a similar level to last year at £4512
million  
a priority during the year has been the development of
our sterilisation services division where we can clearly see
good prospects for profitable expansion in the future our
unique purposebuilt sterilisation unit at bellshill servicing
hospitals in the glasgow and lanarkshire region has now
had three years of profitable operation we plan to build
on this success by using our skills and the experience
gained in this field to develop more units on the back of
the nhs programme for outsourcing sterilisation services
on a national basis
details of this programme have now been announced and
the nhs is in the process of issuing tender documents for
the first wave of contracts   i am very pleased to report
that shiloh sterilisation services has been shortlisted for
some of these contracts and we are hopeful that we will
win one or more in the first wave
the contracts will be awarded for a ten to fifteen year
term and would require us to raise additional finance
the directors are currently considering the best means of
securing this finance as they believe that the successful
growth of the sterilisation services division is an important
way forward for the group
chairman’s
“we must maximise the opportunities that the growth
in the national healthcare budget presents”
statement
4 5
a review of the operation of the three divisions is contained in the
chief executive’s report 
results
profit for the year before tax exceptional items amortisation and
interest is £428000 2003 £123 million
sales are £4512 million 2003 £4544 million
group profit before tax is £310000 2003 £490000 after charging
amortisation of intangible assets of £290000 and crediting an
exceptional profit on property sales of £367000
earnings per share before amortisation of intangible assets and
exceptional items are 266p per share 2003 1213p
dividend
as a reflection of our confidence in the future the directors believe
they are justified in maintaining the dividend at the same level as last
year and therefore recommend a final dividend of 385p per share
making the total dividend for the year 535p 2003 535p
property
we were successful in completing the sale of our three surplus
properties during the year namely park mill and the previous head
office in holden fold both in royton and swan lane mill in bolton
these properties realised £184 million and resulted in an exceptional
profit of £367000
finance
cash flow has been favourable during the year and net borrowings
have been reduced by £796000 to £154 million
£681000 has been spent on new plant and equipment mainly on
upgrading the shiloh connect and other it systems and on additional
manufacturing plant in addition there is a commitment of over
£400000 to purchase a new wipes manufacturing machine which will
result in greater efficiency and significant cost savings
it is pleasing to note that the frs 17 valuation of our defined benefit
pension scheme has risen by £672000 during the year due to an
increase in the value of the scheme’s investments
directors
the director retiring by rotation under the company’s articles of
association is mr dieno george mr george has decided not to offer
himself for reelection and will retire at the conclusion of the annual
general meeting on 18
th
june
i would like to thank dieno for the contribution he has made as a non
executive director since he joined the board in 2001 his knowledge of
the healthcare industry and his contribution to the board’s strategic
thinking has been invaluable
employees 
as always we rely on the dedication and professionalism of our
employees which has been clearly demonstrated in what has been a
tough year  my board colleagues and i greatly appreciate the support
and commitment they have shown particularly in accepting the
changes that have been necessary to move the group forward
outlook
we expect the demand for the group’s products and services to
continue to grow in line with the growth in the national healthcare
budget  it is up to us to maximise the opportunities that this presents
i believe that we can gain advantage from an environment that places
healthcare at the top of the list of national priorities and that with the
work that has been done to reshape the group over the last two years
we will move forward in the coming year
edmund t gartside chairman a key focus for the year has been on higher margin
activity gross profit as a percentage of sales increased
from 274 to 292 reflecting the improving margins
within the business despite the adverse impact of the
strengthening of the euro currency movements had a
negative impact on profitability for the year of £325000
during the year we have continued to incur significant
restructuring costs and these have impacted on the
operating profit
the surplus properties have now all been disposed of
and are no longer a distraction to the core business
cash flow was another focus for the group during the
year and the operating cash inflow of £576000 2003
£18 million before exceptional items was encouraging
given the profit performance
medical
the division is focused primarily on disposable products
for use within the nhs and the private healthcare sector
it provides product and service solutions in the areas of
continence care infection prevention and wound
management
divisional sales were £321 million down from £333
million in 2003 within the division we saw another
strong performance from our scottish distribution
business fastaid products whilst macdonald  taylor
our cotton wool business delivered a sound set of results
in difficult market conditions sales of simply gentle
organic cotton wool again grew strongly albeit from a
modest base
shiloh healthcare comprising the continence care
infection prevention and wound management businesses
had a difficult year facing fierce price competition as a
result of changes in purchasing strategies within the nhs
at the half year we said that we were reviewing strategy
as regards home delivery activities for continence care
products because this part of the business made losses 
in the early part of the year we have now refined
warehousing and distribution systems to improve
profitability while maintaining service levels
overall sales of continence care products were flat year
on year although sales of product through the home
delivery service where margins are lowest increased by
more than 8 most of the negative currency
movements in shiloh healthcare were as a result of a
longterm supply agreement for subcontracted
continence care products sold through the home delivery
service we have negotiated a new arrangement with
the group is in the process of transforming itself 
from operating in commodity healthcare sectors which
demand high levels of overhead expenditure due to high
service levels expected by our key customers to higher
margin branded products and services 
last year i explained the restructuring of the business
into three divisions – medical active care and
sterilisation services when we announced the half 
year results in october we gave an update on trading
conditions and initiated a detailed review of costs and
sales given the poor performance in the first half of the
year particularly in the active care division as a result
changes were implemented without delay and the cost
base reduced to reflect the sales which were lower than
we had anticipated although the result for the year is
disappointing it is encouraging that it was slightly ahead
of our reforecast following the detailed review
chief executive’s
review
6
“our stategy remains on
course actions taken
during the second half of
the year have placed us in
a much stronger position
to deliver the strategy” substantially lower prices and no risk from currency movements 
this arrangement started in the new financial year
sales of infection prevention products fell as planned by more than
25 year on year this is consistent with our strategy allowing us to
concentrate on our own brand primeguard 
following the renewal of the nhs dry wipes contract which we
announced at the half year we have taken the decision to invest 
in state of the art manufacturing plant for this key product area 
this equipment is currently being installed and we expect it to be 
in operation during the month of may 
sales of our new wound management products grew strongly during
the year both in the primary care community sector and in the acute
care hospital sector where we now hold more than 12 of the
market following the year end we have signed an agreement with
protex capillary dressings ltd who have appointed us as their exclusive
uk distributor for vacutex a novel primary wound dressing for use on
all kinds of chronic wounds we see this as a major step in us further
developing this key market area
active care
this division supplies and maintains a comprehensive range of mobility
and rehabilitation equipment across the uk the range includes
wheelchairs scooters hoists slings stair lifts ramps chairs beds and
general aids
division sales were £108 million an increase of 84 at the half year
we said that two units had been closed and that further rationalisation
was planned since then we have closed three small and poorly
performing sites although we have lost some contract business in
merseyside we have been awarded two large wheelchair service and
repair contracts in northern ireland and preston and accordingly have
opened two new sites the result of this additional contract activity
means that our annual contractoriented business has grown by more
than £05 million further reducing our reliance on private sales in line
with our stated aims the proportion of institutional sales has increased
from 54 to 59
the rebranding exercise introducing the “shiloh active care” brand
across the group continues to progress according to our plans and we
expect the exercise to be complete early in the current financial year
we have received a very positive response from both customers and
employees the restructuring of our active care division has been more
complex than anticipated and consolidation of computer systems in the
new financial year will enhance our ability to derive benefit from our
purchasing strength
our relationship with sumed international uk ltd and roho inc for
pressure care products remains very strong and much of the sales
increase in the year was as a result of these new arrangements during
the current financial year we will be changing the sales force structure
to ensure that even more emphasis is placed on this key area
the new mail order catalogue has been well received and is already
making a good contribution to sales we intend that private sales will
increasingly be made through this route with less dependency on the
traditional retail channel
at the half year we said that costs would be reduced in the second
half this exercise was completed quickly with most of the savings
coming from the active care division
sterilisation services
this division was established as a new concept for the decontamination
of surgical instruments in the private sector it operates from custom
built sterilisation facilities at bellshill lanarkshire
the business performed well during the year with sales in line with the
previous year but with improved levels of gross profit as a result of an
increase in the focus on higher margin reprocessing work the unit has
now established itself as a sound business with capacity to grow as new
opportunities arise
in june 2003 the nhs announced its plans to upgrade
decontamination facilities throughout england we have been very
active in this project and see this as a significant opportunity to expand
our division by building new facilities south of the border
management
it has been a difficult year for the business the management team and
employees have worked hard in implementing the changes necessary to
rebase the business 
during the year paul davies was appointed managing director of shiloh
active care paul has nearly twenty years experience of the mobility
industry having joined us in 2000 when we acquired icr mobility
we also strengthened the finance team with the appointment of marie
greenwood as financial controller marie is a chartered accountant
and joined us from northern foods plc
strategy
our aim is to develop innovative longterm mutuallybeneficial
partnerships with healthcare providers in the supply of continence care
mobility and rehabilitation prevention of infection and wound
management these partnerships will add value through the supply
distribution and brand development of the products and services we
provide
our intention is to


Summary:
 overview
the result for the year is disappointing and does not
reflect the tremendous energy and effort involved in re
positioning the group as a leading supplier of products
and services to the national health service and the private
healthcare market 
the cost and time taken to make the necessary changes
to reposition the group have been much greater than
expected  in particular the restructuring of our four
mobility acquisitions into one division shiloh active care
has proved a costly exercise and has had a significant
negative impact on operating profit
the medical division has had a year of mixed fortunes
our glasgow based distribution operation fastaid
products has again turned in an excellent performance
but the main oldhambased operation has been adversely
affected by the costs involved in restructuring and
changing the product mix  we have withdrawn from
some low margin business and started to build up a range
of higher margin products most notably our comfi
bandage range of woundcare products and the clinisan
brand of emollient cleansing foam these two products
have resulted in new sales of over £900000 which have
replaced nearly £2 million of low margin business mainly
in workwear
under these circumstances the group has done well to
maintain sales at a similar level to last year at £4512
million  
a priority during the year has been the development of
our sterilisation services division where we can clearly see
good prospects for profitable expansion in the future our
unique purposebuilt sterilisation unit at bellshill servicing
hospitals in the glasgow and lanarkshire region has now
had three years of profitable operation we plan to build
on this success by using our skills and the experience
gained in this field to develop more units on the back of
the nhs programme for outsourcing sterilisation services
on a national basis
details of this programme have now been announced and
the nhs is in the process of issuing tender documents for
the first wave of contracts   i am very pleased to report
that shiloh sterilisation services has been shortlisted for
some of these contracts and we are hopeful that we will
win one or more in the first wave
the contracts will be awarded for a ten to fifteen year
term and would require us to raise additional finance
the directors are currently considering the best means of
securing this finance as they believe that the successful
growth of the sterilisation services division is an important
way forward for the group
chairman’s
“we must maximise the opportunities that the growth
in the national healthcare budget presents”
statement
4 5
a review of the operation of the three divisions is contained in the
chief executive’s report 
results
profit for the year before tax exceptional items amortisation and
interest is £428000 2003 £123 million
sales are £4512 million 2003 £4544 million
group profit before tax is £310000 2003 £490000 after charging
amortisation of intangible assets of £290000 and crediting an
exceptional profit on property sales of £367000
earnings per share before amortisation of intangible assets and
exceptional items are 266p per share 2003 1213p
dividend
as a reflection of our confidence in the future the directors believe
they are justified in maintaining the dividend at the same level as last
year and therefore recommend a final dividend of 385p per share
making the total dividend for the year 535p 2003 535p
property
we were successful in completing the sale of our three surplus
properties during the year namely park mill and the previous head
office in holden fold both in royton and swan lane mill in bolton
these properties realised £184 million and resulted in an exceptional
profit of £367000
finance
cash flow has been favourable during the year and net borrowings
have been reduced by £796000 to £154 million
£681000 has been spent on new plant and equipment mainly on
upgrading the shiloh connect and other it systems and on additional
manufacturing plant in addition there is a commitment of over
£400000 to purchase a new wipes manufacturing machine which will
result in greater efficiency and significant cost savings
it is pleasing to note that the frs 17 valuation of our defined benefit
pension scheme has risen by £672000 during the year due to an
increase in the value of the scheme’s investments
directors
the director retiring by rotation under the company’s articles of
association is mr dieno george mr george has decided not to offer
himself for reelection and will retire at the conclusion of the annual
general meeting on 18
th
june
i would like to thank dieno for the contribution he has made as a non
executive director since he joined the board in 2001 his knowledge of
the healthcare industry and his contribution to the board’s strategic
thinking has been invaluable
employees 
as always we rely on the dedication and professionalism of our
employees which has been clearly demonstrated in what has been a
tough year  my board colleagues and i greatly appreciate the support
and commitment they have shown particularly in accepting the
changes that have been necessary to move the group forward
outlook
we expect the demand for the group’s products and services to
continue to grow in line with the growth in the national healthcare
budget  it is up to us to maximise the opportunities that this presents
i believe that we can gain advantage from an environment that places
healthcare at the top of the list of national priorities and that with the
work that has been done to reshape the group over the last two years
we will move forward in the coming year
edmund t gartside chairman