annu al repor t 2002
tt electr onics plc
tt electr onics plc  annu al repor t 2002
tt electronics plc
clive house
1218 queens road
weybridge
surrey kt13 9xb
tel 44 0 1932 841310
fax 44 0 1932 836450
wwwttelectronicscom
tomorrow’s technology contents
highlights and ﬁnancial information 1
chairman’s statement 2
group overview 4
chief executive’s review 6
financial review 14
directors and company secretary 16
directors’ report 17
directors’ remuneration report 21
report of the independent auditors 25
consolidated proﬁt and loss account 26
consolidated balance sheet 27
consolidated cash ﬂow statement 28
statement of total recognised gains and losses 29
reconciliation of movements in shareholders’ funds 29
company balance sheet 30
accounting policies 31
notes to the ﬁnancial statements 33
historical record 53
financial calendar 53
notice of meeting 54
principal operating subsidiaries 56
advisors and registered ofﬁce 56
designed and produced by linnett associates printed by ctd capita limited tt electronics plc annual report 2002 1


Summary:
 2 tt electronics plc annual report 2002
chairman ’s statement
tt electronics’ turnover for 2002 was
£5203 million compared with £6307 million
on continuing activities including ceased
activities being £361 million of copper
rod and total turnover of £6579 million 
in the previous year proﬁt before taxation
prior to amortisation of goodwill and
impairment was £204 million 2001 –
£299 million amortisation and impairment
of goodwill amounted to £47 million
2001 – £22 million which included the
write off of the balance of goodwill arising
on the purchase of prestwick circuits
limited in 1999 a plant and machinery
impairment provision of £78 million has
been made due to the continuing losses of
certain of our businesses supplying telecom
related industries
earnings per share before impairment
provisions goodwill amortisation and
exceptional items were 101p compared to
160p basic and fully diluted earnings per
share were 36p 2001 – 122p the
taxation charge of 27 per cent 2001 – 27
per cent is a combination of a charge on
current trading and the beneﬁt of deferred
taxation relief on impairment provisions
net borrowings of the group have been
kept ﬁrmly under control which has
enabled the group to continue to invest in
its manufacturing facilities and at the same
time follow a strong dividend policy total
net indebtedness at the year end was
£558 million compared with £635 million
at the previous year end
i mentioned in my half year statement 
that the board’s decision to maintain skill 
levels in our telecom related businesses
would be kept under review in the light 
the automotive industry is a growth area for electronic components our sensor and
systems sales grew by 6 per cent this year and are expected to grow by 25 per cent 
by the year 2005 tt electronics will continue its policy of looking to the future and
developing new products in line with the needs of the marketplace
john newman
executive chairman tt electronics plc annual report 2002 3
of the uncertainty of demand from the
telecom industry over the next two years
the board subsequently decided that the
reorganisation of certain businesses was
necessary as a result the united kingdom
manufacture of ferrites has ceased and has
been transferred to our indian facility as
will a range of ferrites from our usa factory
whose operation has been signiﬁcantly
reduced our printed circuit board production
has been successfully consolidated into
one factory in addition to incurring these
associated reorganisation charges redundancy
costs where employee numbers have been
reduced as the result of manufacturing
efﬁciency savings have been incurred as
a normal ongoing cost of the business
the automotive industry is a growth area
for electronic components our sensor and
systems sales grew by 6 per cent this year
and are expected to grow by 25 per cent
by the year 2005 this improvement in
sales comes from the introduction of new
automotive models 2003 will show a
lower increase in sales for whilst we have
had a strong order intake these orders will
provide us with further growth for 2004
onwards the telecom and computer
markets would appear to have bottomed
and are likely to remain at these depressed
levels throughout the year
our policy to strengthen our existing
businesses by making suitable acquisitions
is being pursued on 14 march the assets
of demo tableaux de commande sa 
with a book value of £55 million were
purchased for £25 million demo has a
factory in le mans france and a small
assembly operation in brazil demo
manufactures climate control units their
products are designed into a number of
european cars including renault peugeot
and citroen demo products being
electromechanical complement our
electronic based climate control businesses
in the united kingdom and usa as the
demand for additional features grows
our inhouse expertise and technology 
will beneﬁt our customers and enhance
our turnover
our efforts to maximise the value of our
investment in johnston group plc were
successful and we sold our shareholding
for 425p per share compared with a
market price of 345p the sale generated
£106 million of cash and a proﬁt on
disposal of £12 million
we continue to create a total tt electronics
identity for all the businesses within the
group an initial step has been the creation
of tt electronic manufacturing services
limited which is the combination of ab
electronic assemblies limited and welwyn
systems limited our contract electronic
manufacturing businesses further name
changes binding our companies together
will take place during this coming year
the strong balance sheet and low
borrowings of the group gives the board
the conﬁdence to recommend a ﬁnal
dividend of 636p per share this brings the
total dividend for the year to 1005p the
same as last year the dividend will be paid
to shareholders on the register on 16 may
and will be payable on 29 may 2003
i would like to thank all the employees of
the group for their efforts during a difﬁcult
year and i look forward to them beneﬁting
in the future from a strongly established
tt electronics group
it would appear that overall demand in the
marketplace for our products in the current
year is likely to be no better than last year
tt electronics will continue its policy 
of looking to the future and developing
new products in line with the needs of 
our customers
john w newman
executive chairman
17 march 2003