building the  
retina company
optos plc annual report and accounts 2011
optos plc annual report and accounts 2011
2optsar11coverjennyogindd   3 17012012   110750 overview governance
 02 our year at a glance
 04 about optos
 06 chairman’s statement
business review
 08 chief executive’s re view
 10 operating review
  10 our business model and strategy
  12 delivering our strategy
 20 financial review
 23 key performance indicators
 24 principal risks and uncertainties
 28 board of directors
 30 operating board
 32 corporate governance
 38 directors’ report
 42 directors’ responsibilities
 43 directors’ remuneration report
sections of interest
during the year we delivered a significant increase 
in both revenues and profits whilst making important 
investments in the longterm growth of the business
we expanded into several new markets whilst building 
our product portfolio through both acquisition and 
organic development
the board remains committed to ensuring high 
standards of corporate governance are maintained
operating review 
delivering our strategy
through a range of complementary 
diagnostic and treatment devices 
optos aims to be the retina company
turn to pages 10–19
our vision is to be recognised as a 
leading provider of retinal devices and 
solutions to ophthalmic professionals 
for improved retina care
we are achieving this through a focused strategy 
that centres on expanding our channels segments 
and geographic markets to secure our leading position 
in retinal diagnostic and treatment devices
access this report online
aroptoscom2011
2optsar11coverjennyogindd   4 17012012   110753 optos plc annual report and accounts 2011 01
see and treat 
our retinal devices make the 
early detection management 
and treatment of both eye and 
non‑eye diseases possible
the release of our newest screening 
device daytona marks a pivotal point 
in the development of our product 
range which will enable much wider 
access to our unique widefield  
imaging technology
financial statements
 52  independent auditors’ report
 54  consolidated income statement
 54  consolidated statement of comprehensive income
 55 group and company balance sheets
 56  group and company statements of changes 
in equity
 57  group and company cash flow statements
 58  notes to the consolidated financial statements
104 five year summary
overview
business review
governance
financial statements
4optsar11frontjennylesleyshindd   1 17012012   110611 optos plc annual report and accounts 2011 02
overview
our year at a glance 
strong financial performance ahead of expectations 
•  revenue up 35 to 1433m 
•  over 25 underlying revenue growth 
•  continued trend towards outright sales up 295m to 376m and finance leases 
up 121m to 198m 
increased geographical reach 
•  north america revenue grew 25 to 1171m and international sales doubled to 262m 
•  new markets opened further eu markets japan australia and middle east 
investment in expansion of product range and complementary technologies 
•  unveiling of daytona next generation desktop retinal device with launch expected q1 2012
•  opto global product sales of 3m and on track for breakeven in first full year of ownership 
•  opko instrumentation integration progressing well enabling entry to oct market 
accelerated growth in ophthalmology 
•  specialist six person sales team established to lead sales efforts in north american market 
•  over 140 200tx devices installed globally 
clinical data continues to demonstrate the importance of widefield imaging 
in the management and treatment of disease
  underlying revenue growth is calculated by treating all payments receivable in the period from rental contracts 
as operating leases including revenues from outright device sales and service contracts but excluding revenues 
from opto global and accutome products
we have made good progress towards  
achieving our vision
strengthening our offering with the 
strategic acquisition of the instrumentation 
division of opko health
in october 2011 we acquired oct and ultrasound 
products to enhance our diagnostic device range 
find out more
turn to page 15
continuing to expand our diverse 
product range with daytona
our latest product daytona the next generation 
ultrawidefield retinal scanning device is set 
for launch in q1 2012
find out more
turn to page 14
4optsar11frontjennylesleyshindd   2 17012012   110614 optos plc annual report and accounts 2011 03
overview
business review
governance
financial statements
matched by an accelerated 
financial performance
integration of opto global on track
in december 2010 we completed our acquisition 
of opto global an ophthalmic and optometry 
device company
find out more
turn to pages 18–19
operating profit m  
before exceptional items
251m 43
0
5
10
15
20
25
gross profit m
914m 29
0
10
20
30
40
50
60
70
80
90
total revenue m
1433m 35
0
20
40
60
80
100
120
140
eps diluted cents
318c 60
0
5
10
15
20
25
30
operating cash flow m
372m 20
0
5
10
15
20
25
30
35
45
2011 2010 2009
net debt m
252m 19
50
40
30
20
10
0
10
40
2011 2010 2009
1433
1063
972
2011 2010 2009
251
175
85
2011 2010 2009
318
199
21
2011 2010 2009
372
464
374
462
2011 2010 2009
914
709
590
252
211
4optsar11frontjennylesleyshindd   3 17012012   110619 optos plc annual report and accounts 2011 04
overview
about optos
revolutionising patient 
care through our powerful 
imaging solutions
through investment development 
and acquisitions we are rapidly 
positioning optos at the leading 
edge of the growing retinal 
diagnostics market
we continue to leverage our core 
widefield technology and sales 
channels and have strengthened 
our position through the addition 
of optical coherence tomography 
“oct” technology
from widefield retinal imaging
revolutionising 
eye care
our core technology the optomap® which 
provides an ultrawide 82 view of the 
retina has proved to be a powerful tool in 
the detection management and treatment 
of eye and noneye disorders
4optsar11frontjennylesleyshindd   4 17012012   110623 optos plc annual report and accounts 2011 05
overview
business review
governance
financial statements
what’s next
we are expanding 
our business through 
a clear strategic plan
turn to page 10
accelerating growth 
we have expanded our 
revenues and product range 
in the last 12 months 
through two acquisitions
increasing our  
product range
we now offer a diverse 
range of products including 
daytona p200 200dx 
200tx plus oct ultrasound 
treatment lasers and visual 
acuity devices 
investing in 
ophthalmology 
and international 
expansion
our global footprint has 
increased dramatically
continuing 
clinical studies
our aim is to provide 
further evidence of 
the optomap® as the 
“gold standard” in 
clinical eye exams 
to becoming the leading provider of the most powerful 
tools for retinal disease diagnosis and treatment
4optsar11frontjennylesleyshindd   5 17012012   110623 optos plc annual report and accounts 2011 06
overview
chairman’s statement
during this year optos has successfully 
achieved substantial growth of its business 
whilst investing in a range of additional 
complementary technologies the expansion of 
the widefield retinal scanning business has been 
driven by both the wellreceived launch of a new 
highperformance device the 200tx and by the 
introduction of new business models which are 
assisting optometrists and ophthalmologists to 
access this technology these advances have 
delivered significant increases in both revenues 
and profits 
our core widefield scanning devices are  
well established with over 4200 devices 
now installed in optometry and ophthalmology 
practices in the markets that we serve a growth 
of some 8 during the year over 32 million 
widefield retinal digital optomap® examinations 
have now been performed by eyecare specialists 
underlining both the efficacy and utility of our 
core technology 
throughout the year we have continued to focus 
upon our customers’ requirements by introducing 
a muchenhanced range of pricing rental and 
purchase options we have expanded our sales 
force moving into new territories in europe and 
australia and established a new team addressing 
retinal specialists in north america the acquisition 
of opto global pty holdings ltd was completed 
in december 2010 and we have been selling 
the opto global product range throughout 2011 
both directly and through the network of 
distributors we acquired with the business 
in brief
•  over 4200 widefield scanning 
devices installed with optometrists 
and ophthalmologists
•  we have expanded our sales 
force moving into new territories 
and new segments
•  the acquisition of opto global 
was completed in december 2010 
and followed by the acquisition 
of oct products in october 2011
•  we launched the 200tx to 
ophthalmology customers and 
unveiled daytona on schedule
 “  advances in our 
range of products 
and business models 
delivered significant 
increases in both 
revenues and profits”
dr peter fellner 
chairman
we have established 
a strong platform 
from which to build 
our business
4optsar11frontjennylesleyshindd   6 17012012   110627 optos plc annual report and accounts 2011 07
overview
business review
governance
financial statements
our newly launched 200tx device has performed 
strongly attracting customers in our direct markets 
and has enabled us to address important export 
markets such as japan one of the largest 
markets in the world for medical devices 
increasing flows of strong clinical data have 
demonstrated the importance of widefield fundus 
imaging in the management and treatment of 
disease we believe that widefield autofluorescence 
images provide clinicians with valuable additional 
information relating to the health of retinal cells 
which makes the use of our technology even more 
compelling for ophthalmologists and optometrists 
worldwide we can also now supply treatment 
laser products surgical microscopes and corneal 
crosslinking products to our clinician customers 
we believe strongly that optos’ growing range 
of products can make an important difference 
to ophthalmologists vitreoretinal specialists 
and their patients 
within our optometry customer base the opto 
global visual acuity and perimetry products are 
competitive with similar products and give our 
sales force an expanded offering alongside the 
core p200 and 200dx scanning devices we have 
further enhanced our product range by offering 
new software features such as optosadvance 
which provides optometrists secure webbased 
storage of images that can be reviewed remotely 
in september 2011 we announced the proposed 
acquisition of additional diagnostic imaging 
devices from opko health inc including optical 
coherence tomography “oct” and ultrasound 
devices together with a strong development pipeline 
this acquisition was completed in october 2011 
and the integration of that business into optos
is moving forward rapidly we are excited by 
the potential that these products offer in all of 
our customer segments in order to finance this 
acquisition we put in place a 30m threeyear 
revolving credit facility which will allow the 
business to be funded on a more conventional 
and costeffective basis 
as a result of these initiatives we delivered 
revenues of 1433m for the year ended 
30 september 2011 compared to 1063m 
in the previous year on a likeforlike basis 
ignoring the impacts of the opto global acquisition 
and of finance lease accounting revenue growth 
was over 25 driven by capital sales the 
acquisitions of opto global and the opko health 
assets resulted in exceptional expenses of 24m 
in the year these were offset by a 175m credit 
relating to a reassessment of the likely deferred 
consideration payable to the former shareholders 
of opto global pretax profits before exceptional 
items were 227m compared to 127m in the 
previous year with basic earnings per share after 
tax and exceptional items increasing to 321c 
compared with 200c in the previous year 
looking forward to the next financial year we 
believe that our next generation ultrawidefield 
retinal scanner daytona will enable optos to 
achieve a further major transition assisting the 
international expansion of the business daytona is 
a desktop sized highspecification highresolution 
device that is modular robust reliable and patient 
friendly it can deliver images of a quality similar 
to or better than our p200c device including 
autofluorescence imaging which is proving 
so valuable to eyecare specialists we promised 
to unveil the product in october 2011 and were 
delighted to deliver on that promise 
the scheduled commercial shipment of daytona 
products remains on track for the first quarter 
of 2012 our expanded sales teams are looking 
forward to selling daytona alongside our new 
oct products and existing device range 
i would like to thank patrick paul who retired 
as a nonexecutive director during the year for 
his significant contributions to the growth and 
development of the company and to welcome 
john goddard and david wilson to the optos 
board as nonexecutive directors i would also 
thank our investors for their support during the 
past year and our employees for their outstanding 
efforts which have underpinned the advances 
achieved within the business 
we look forward to the next year with 
confidence the impending launch of daytona 
and an extended product range including oct 
will arm our sales and marketing organisation 
with a range of highly competitive devices 
which will further strengthen our position 
in the retinal healthcare field
dr peter fellner
chairman
21 november 2011
 
0
total shareholder return
— 
—  
2009 2010 2011
25
50
75
100
125
150
175
200
225
  
  
ftse small cap index
optos plc
4optsar11frontjennylesleyshindd   7 17012012   110627 optos plc annual report and accounts 2011 08
overview
business review
governance
financial statements
business review
chief executive’s review
accelerating 
growth in our 
core business
in brief
•  we delivered a significant 
increase in both revenues 
and profits
•   we expanded into several 
new markets
•   we developed a growing body of 
clinical evidence that demonstrates 
the critical importance of 
retinal diagnostics
•   we made strong progress 
towards becoming the leading 
retinal diagnostics company
overview
the strong growth in our revenues increasing 
35 from 1063m in 2010 to 1433m this year 
reflects the successful implementation of a number 
of key strategic changes during the past year 
new business models 
our customers have responded well to the 
alternative business models we now offer many 
are still happy to work with our payperpatient 
rental model but we are seeing an increasing 
trend towards the new alternatives such as 
fixed rental contracts renttoown or outright 
purchases of the devices we believe this 
contributed to the low levels of customers 
choosing to deinstall their devices with only 
around 5 of our customers returning their 
products at the end of the contract term 
compared to 10 the previous year
improved core products 
at the beginning of this year our sales team 
focused only on selling our core ultrawidefield 
imaging devices to a customer base focused 
largely on optometry we armed our teams with an 
improvement to our base p200 device the 200dx 
many customers chose to acquire the 200dx 
upgrade which offers improved image quality 
either on a new contract through purchase or upon 
renewing their existing contracts others chose 
the p200 which was priced more competitively 
we also acquired additional products initially 
through a distribution deal with accutome then 
through the purchase in december 2010 of the 
australian company opto global pty holdings ltd 
and further through our inhouse development 
of the image management and archiving product 
optosadvance this range of products gave 
the sales team the opportunity to attract new 
customers and retain existing contacts
expanding into ophthalmology  
our p200c devices remain popular with clinical 
optometrists and general ophthalmologists 
particularly in the canadian and german markets 
additionally optos chose to focus significant 
efforts on the ophthalmologist and retinal 
 “  we have expanded into 
several new markets 
whilst building our 
product portfolio both 
through acquisition and 
organic development”
roy davis  
chief executive officer
4optsar11frontjennylesleyshindd   8 17012012   110630 optos plc annual report and accounts 2011 09
overview
business review
governance
financial statements
specialist sectors with the launch and promotion 
of the 200tx device promoted solely to those 
customers a specialist sixperson sales team 
was established to lead the sales efforts into 
this marketplace in north america supported 
by the broader sales team 
the clinical information delivered by the images 
from these devices including our standard 
optomap® images derived using red and green 
lasers together with fluorescein angiography 
images using blue laser technology disclosing 
information about the vasculature of the retina 
and autofluorescence delivering information 
about the metabolic state of the retinal cells 
and their health all in the widefield is attracting 
significant medical interest we are pleased to 
have placed over 140 of the 200tx devices 
the additional opto global products used by 
ophthalmologists including treatment lasers 
and surgical microscopes are helping to 
establish optos in the ophthalmology sector
geographic expansion  
we took significant steps towards expanding 
our geographic reach sales representatives 
were recruited in new territories in europe 
including austria and the netherlands and the 
sales teams strengthened in our other direct 
markets being germany uk switzerland 
sweden norway and spain our european 
presence was further strengthened through the 
appointment of distributors and dealers in italy 
and poland opto global brought us an extensive 
international distributor network including in 
europe middle east and africa it also brought 
us a direct footprint in australia a market for 
which we see great potential the 200tx product 
also brought us our first sales in the important 
japanese market where we appointed a 
strong distributor 
expanding our product range  
in october 2011 we completed the acquisition of 
the business and assets of opko instrumentation 
bringing access to established oct and ultrasound 
products together with a product pipeline including 
a lowercost oct product falcon nearing market 
launch we are excited by this acquisition as 
we believe that optos’ widefield retinal imaging 
technology combined with the specific data that 
can be derived from oct images has the potential 
to offer eyecare professionals the most powerful 
tools for disease diagnosis and management 
we were also proud to deliver our leading 
development project daytona on schedule 
this project conceived two years ago set out to 
deliver a desktop sized version of our widefield 
slo scanning device our objective was to create 
a product that would deliver images of a quality 
as high as the p200c device would capture the 
same widefield view of the retina would be robust 
manufacturable in volume with autofluorescence 
imaging run from new intuitive software and would 
offer a device that could be used by customers 
globally regardless of practice size or physical 
or climatic environment we unveiled daytona as 
planned in october and are set to ship product to 
customers before the end of the first half of 2012
research and development  
our rd activities are driven from scotland 
and our team is now some 45 strong including 
the software and hardware engineers who 
joined with oct business just after the year end 
significant projects delivered this year include 
daytona and optosadvance
in 2011 we gained additional patent protection 
for our core widefield imaging technology 
extending the slo core patent claims through 
2027 the focus in 2012 is to deliver daytona 
at volume add additional imaging modalities to 
our 200tx device and deliver the next generation 
falcon oct devices ensuring full integration of 
the recently acquired assets and devices 
our sales team is now over 90 strong with 
clinical experts supporting and training all 
representatives to allow them to deliver 
excellent support to clinicians 
          benefits
visibility  
of future  
income
business 
models
pay‑ per‑ patient                      flexible leases
income visibility 
plus the upside  
of variable  
optomap
®
  
charges
                     outright purchase                     
summary and outlook
during the last financial year we have delivered 
a significant increase in both revenues and 
profits whilst making important investments in 
the longterm growth of the business we have 
expanded into several new markets whilst building 
our product portfolio both through acquisition and 
organic development at the same time we have 
developed a growing body of clinical evidence that 
demonstrates the critical importance of retinal 
diagnostics overall we are pleased with our 
progress towards becoming the leading retinal 
diagnostics company and are increasingly confident 
about optos’ longterm growth prospects
roy davis
chief executive officer
21 november 2011
 
improved cash flow 
and upside from 
service contracts
 gives customers the choice to fix payments
   but benefit from rental terms
           benefits
 allows customers a lower fixed rental and reducing
 price per optomap with higher patient volumes 
     allows customers choice and means no 
 
             benefits
     additional charges regardless of volume
4optsar11frontjennylesleyshindd   9 17012012   110631 optos plc annual report and accounts 2011 10
business review operating review
our business model and strategy
achieving our vision and exploiting 
opportunities for continued growth
our vision
to be the retina company
expand 
 customer 
segments
leverage  
our sales 
channel
grow 
our global  
reach
our strategic plan
building the retina company and securing 
our leading position in retinal diagnostics
optos plc annual report and accounts 2011 10
our aim
to supply integrated devices and software 
services to customers in all major markets
optos is not seeking to address every aspect 
of eyecare but does seek to be a leading player 
in supplying solutions to both optometrists and 
ophthalmologists for the diagnosis and management 
of conditions of the retina—our vision is to be 
the retina company the marketplace for products 
in which optos competes is estimated at 810m in 
2011 and forecast to grow to 1097m by 2016 and 
our aim is to be a major player supplying integrated 
devices and software services to customers in all 
major markets in this highly regulated space 
our model is to
•	 exploit	our	existing	products
•	 acquire	or	develop	new	and	improved	products
•	 	 manufacture	or	subcontract	manufacture	of	
products	as	appropriate
•	 	 support	our	products	and	customers	with	compelling	
clinical	evidence
•	 	 deliver	revenues	through	rental	or	sale	business	
models	and
•	 	 expand	our	geographic	reach	both	through	our	
direct salesforce and distributors 
find out more
across pages 12–19
4optsar11frontjennylesleyshindd   10 17012012   110635 optos plc annual report and accounts 2011 11
overview
business review
governance
financial statements
overview
business review
governance
financial statements
optos plc annual report and accounts 2011 11
4optsar11frontjennylesleyshindd   11 17012012   110641 optos plc annual report and accounts 2011 12
business review operating review
delivering our strategy
strategic aims
grow
our global reach
through actively seeking 
opportunities to establish 
distribution and direct channels 
in other important global markets
how we measure it
we set ourselves some challenging 
objectives for 2011 and we are pleased 
to have delivered against most 
we set out to increase revenues and 
profits from our device and customer 
base and to
•	 	 maximise	upon	the	existing	
sales channel
•	 	 expand	our	sectors	and
•	 	 expand	our	geographic	reach
optos has a clear vision 
to be the retina company
the following pages 
outline how we are 
delivering our strategy
turn to pages 14–19
for a full breakdown of our 
key performance indicators
turn to page 23
revenue by 
geographic 
segment
optos plc annual report and accounts 2011 12
leverage
our sales channels
by adding additional products 
and business models and ensuring 
our sales force understands the 
clinical needs of our customers 
and provides them with the best 
service and support
expand
customer segments
through keeping a clear focus 
on the needs of our optometry 
customers delivering the products 
our ophthalmology customers 
require and continuing to deliver 
compelling clinical evidence
total installed 
base for core 
imaging device
average number of 
monthly optomaps® 
per rental site
revenue by type
4optsar11frontjennylesleyshindd   12 17012012   110641 optos plc annual report and accounts 2011 13
2012 objectives what happened in 2011
•  installed base increased by 5 
to 4240
•	 launched optos ophthalmology
•	 	 built specialist north america 
vitret team
•	 	 increased ophthalmology customer 
base to 400
•  average optomaps per rental site up 
2 to 112
•  outright device sales increased by 
295m to 376m
• 200tx and optosadvance launched
•  opto global and opko acquisitions 
brought additional products
•  significant numbers of clinical studies 
and papers completed
•  international sales increased by 103 
to 262m
•  distributor network enhanced both 
directly and through opto global and 
opko acquisitions
•  direct sales presence expanded into 
new territories including benelux 
and australia
•  continue with the strategy of global 
expansion by “filling the cube”
	•  exploit existing sales channels and 
products	and	expand	in	core markets
	•	 	 further	penetrate	ophthalmology	and
	• extend our geographic reach
marketplace and industry overview
the importance of eyecare increases daily somewhere in the world 
someone goes blind every five seconds and a child goes blind every 
minute worldwide it is estimated that 7 million people lose their 
vision every year and that 180 million people are blind or visually 
impaired rates of vision loss are expected to double by 2020 unless 
prevention efforts are intensified
leading causes of vision loss include cataracts glaucoma and age 
related macular degeneration “amd” amd is the leading cause 
of blindness in people over the age of 55 diabetic retinopathy 
is the leading cause of preventable blindness in the world
the economic and social impact of loss of sight is significant 
the global cost of vision loss is estimated to be nearly 3tn yearly
optometrists offer primary specialist care for eyes generally treating 
healthy patients checking for eye disease and managing certain 
diseases much of the optometrists’ income is patient pay although 
some reimbursement is available for certain disease treatments and 
through some eyecare insurance products ophthalmologists provide 
secondary and tertiary care for eyes generally treating patients with 
disease with much of their patients gaining insurance or health system 
reimbursement for the treatments offered
whilst the economic climate internationally is unstable within optos’ 
markets and sectors eyecare specialists remain attractive customers 
reimbursement rates will always come under pressure and optos 
intends to respond by delivering increasingly useful services and 
improved product pricing where possible 
strategic context
810m 
current value of the 
marketplace in which 
optos competes
1097m 
projected growth of 
marketplace by 2016
optos plc annual report and accounts 2011 13
•  maximise the benefits of the 
opto global acquisition
•  effectively integrate the oct 
and ultrasound business
	•	 	 maintain	sales	through	distributors
	•	 	 maximise	sales	in	direct	markets
	•  deliver falcon 1 and 2 before end 
2012	and
	•  deliver integrated device allowing 
oct scanning in the widefield
•  deliver daytona on schedule and 
maximise sales
	•  phase 1 0–9 months launch in us 
canada germany uk scandinavia 
benelux	spain	switzerland	austria
	•  phase 2 9–18 months launch in 
australia india south africa turkey 
other	eu	countries	middle	east	and
	•  phase 3 18 months launch japan 
china korea brazil rest of world
overview
business review
governance
financial statements
4optsar11frontjennylesleyshindd   13 17012012   110641 optos plc annual report and accounts 2011 14
overview
business review
governance
financial statements
business review operating review
delivering our strategy
optos plc annual report and accounts 2011 14
expand our customer segments
optometry
optometry has been the core of our business 
particularly in the us market
•   optometrists are the primary providers of 
eyecare and digital retinal screening is becoming 
an accepted part of the comprehensive eye 
examinations they conduct
•   our p200 and 200dx devices are used by most 
of our optometry customers although some 
choose to use our higherend devices
•  we have added further products used by 
optometrists such as the visual acuity chart 
devices and automated perimeters the optical 
coherence tomography oct products are also 
used in wellness screening by optometrists
ophthalmology
ophthalmologists are the providers of secondary 
eyecare managing patients who have been 
diagnosed by their primary healthcare provider 
as needing specialist treatment
•  ophthalmologists require additional functionality 
for imaging devices to properly assess and 
treat their patients as do vitreoretinal 
specialists who focus on retinal diseases 
such as diabetic retinopathies the 200tx 
is directed to this customer group 
•  the products acquired through our recent 
acquisitions such as the photo disruption 
and photo coagulation lasers oct and 
ultrasound scanners delivers a fuller  
offering to this segment 
our core sales force has been strengthened due to the addition of a small team with 
specialised knowledge of the work of ophthalmologists and vitreoretinal specialists 
this vitret team supports those specialists and assists the core team in delivering 
our new products to general ophthalmologist customers 
daytona
designed to globalise our core widefield retinal imagining technology
400 
ophthalmology customers 
in germany switzerland 
japan and north america
our next generation ultrawidefield retinal scanner daytona is 
intended to assist the expansion of the business by appealing to a more 
global market through its small footprint easier to ship and improved 
ease of use in north america it is aimed at the clinical optometry market 
and at both optometrists and general ophthalmologists elsewhere
this project conceived 2 years ago set out to deliver a desktop sized 
version of our widefield slo scanning device with the objectives of 
creating a product that delivered images of a quality as high as the p200c 
device capturing the same widefield view of the retina was robust 
manufacturable in volume with autofluorescence imaging run from new 
intuitive software and offering a device that could be used by customers 
 globally regardless of practice size or physical or climatic environment 
  we unveiled daytona as planned in october and are set to ship product 
   to customers before the end of the first quarter 2012 
product benefits
•	 	 improved product 
performance colour and 
af imaging modalities
•	 smaller desktop size
•	 improved ease of use
•	 	 cheaper to install and 
maintain	manufacturing	
cost target achievable
•	 leading edge design
•	 colour customisable
140 
200tx devices placed
4optsar11frontjennylesleyshindd   14 17012012   110644 optos plc annual report and accounts 2011 15
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shortly after the year end we completed the 
acquisition of the instrumentation division of 
opko health bringing access to established oct 
optical coherence technology and ultrasound 
products together with a product pipeline 
including a lowercost oct product falcon 
nearing market launch 
oct delivers an image that shows a  
threedimensional crosssectional view of 
the retina in any particular area typically 
in the central pole area of the retina around 
the optic nerve and macula and is used to detect 
the presence of and understand the severity of 
disease determine treatment approaches and 
monitor posttreatment effects
we are excited by this acquisition as we believe 
that optos’ widefield retinal imaging technology 
combined with the specific data that can be 
derived from oct images has the potential to 
offer eyecare professionals the most powerful 
tools for disease diagnosis and management 
the spectral oct market 
is both growing and 
diversifying presenting 
a unique opportunity for 
new entrants to quickly 
gain market share
overview
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optos plc annual report and accounts 2011 15
product positioning
functionality
optometry market ophthalmology market
price
p200
200dx
200tx
p200c
daytona
wellness 
imaging
 
diagnosis
disease 
management
treatment 
planning
4optsar11frontjennylesleyshindd   15 17012012   110652 optos plc annual report and accounts 2011 16
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delivering our strategy
we are building 
and improving our 
sales channels and 
increasing their 
efficiency through 
our expanded 
product range
leverage our sales channels
though ultrawidefield retinal imaging 
remains at the core of our business we have 
vastly expanded our offering in the past two 
years by providing a wider offering we are able 
to meet more of the needs of the practice and 
become the overall retina company of choice 
for professionals worldwide
this increased product range is an important tool 
for our sales team allowing them to engage new 
customers and offer additional products which 
might appeal to existing customers we maximise 
these channels through keeping in place industry 
based and proven sales management as well as 
indepth salesforce training to ensure our staff 
are as helpful and knowledgeable as possible
retinal imaging products
our widefield retinal imaging technology combined with 
the specific data that can be derived from oct images 
offers ophthalmologists and optometrists the most 
powerful tools for disease diagnosis and management
medicalsurgical devices
optos has acquired a wide range of medical surgical 
devices including photocoagulators photodisruptors 
surgical microscopes and corneal cross‑linking systems 
designed by a development process focused on longevity 
dependability and a high level of precision and performance 
for optimum clinical outcomes these products have a 
reputation for value reliability and efficiency
diagnostic instruments
expanding the company goal to support practitioners in 
diagnosing analysing and monitoring ocular pathology 
optos recently added new product lines through the 
acquisition of opto global the products including 
ultrasound technology visual field devices ophthalmic 
lenses and visual acuity systems are complementary 
additions to the core imaging technology
p200 device 200tx device
visual 
acuity 
chart
ap300 
automated 
perimeter
advant™ 
yag laser
fastpulse™ 
laser
optos plc annual report and accounts 2011 16
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8
increase in customer base for 
core widefield imaging devices
daytona spectral 
oct slo™
product categories
product categories
•  ultrawidefield 
imaging
•	oct imaging
•	corneal crosslinking
•	photocoagulators
•	photodisruptors 
•	surgical microscopes
•	ultrasound
•	photodisruptors 
•	surgical microscopes
product categories
xlink™ corneal  
crosslinking 
system
hyalus™ 
green laser
our products are now also supported 
by optosadvance a unique image 
management offering that puts 
optos at the ‘heart’ of the practice
our proprietary image management software launched during 
2011 and free to all rental customers integrates seamlessly with 
our technologies to allow cloud archiving and webbased review 
from any location enabling more comprehensive patient reviews 
and improving practice efficiency
optos plc annual report and accounts 2011 17
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optos plc annual report and accounts 2011 18
business review operating review
delivering our strategy
direct
core distributor
other distributor
our global presence
the integration of opto global in 2011 
has enabled us to leverage existing 
distributors in emerging markets 
including the far east middle east 
africa and south america 
262m
international 
revenue
integration on track to 
introduce opto global 
products in north america 
£1171m
north american 
revenue
new distributor  
appointed in japan
direct markets
• expansion of optos direct channel
	•  additional sales staff in existing markets
 •  opening new direct markets in 
australia singapore benelux austria
 •  via commission agents in france 
denmark finland and poland
• continued focus on asset utilisation
indirect markets
•  drive sales in key distributor markets
• optimise the distributor channel
•  drive distributor sales of optos opko 
and opto global products
growth drivers and opportunities
now building a significant 
direct presence in australia
4optsar11frontjennylesleyshindd   18 17012012   110730 optos plc annual report and accounts 2011 19
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grow our global reach
we are investing in manufacturing and inventory 
and expanding our global sales force and distribution 
channels in order to accelerate our penetration of 
international markets
3m 
delivered by the acquisition of opto global in revenues from 
new products as well as synergies from new sales channels
optos plc annual report and accounts 2011 19
the acquisition of opto global completed in 
december 2010 brings additional devices for 
both optometrist and ophthalmologist practices 
including the visual acuity products smartchart 
and the ap100 ap200  ap300 perimeters and  
treatment lasers and has expanded our 
geographic reach outside our core north 
american and european markets
we are now building a significant direct presence 
in australia and exploiting the distributor network 
we acquired with opto global we appointed a 
distributor in japan to whom we have delivered 
over 20 200tx devices the opko transaction 
brings us further opportunities to expand our 
international presence
in addition we are continuing to build inventory 
of our p200c and 200tx devices and invest in 
expanding our sales force we have placed a 
number of devices on trial at key opinion leader 
sites on extended payment terms in addition we 
have improved our manufacturing capability such 
that we now build p200c and p200ma devices in 
the us as well as scotland this investment will 
enable lower service and maintenance costs in 
the future by delivering product from proximal 
locations and free up capacity in scotland to 
handle the new daytona device which we expect 
to be an internationally attractive product
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in brief
•  revenues grew by 35 to 
1433m likeforlike revenue 
growth was over 25
•  north american revenues grew 
23 to 1171m and international 
revenues grew by 103 to 262m
•  pretax profits grew from 127m 
in fy10 to 220m this year
•  undiluted earnings per share 
were 321c compared with 200c 
in the prior year
 “  our revenues grew 
by 35 to 1433m 
and include 376m 
from outright sales of 
devices and 198m 
from sales under 
finance leases” 
christine soden 
chief financial officer
delivering significant 
increases in revenues 
and profits
revenues and customer base
as we forecasted last year an increasing proportion 
of our revenues for 2011 came from sales of 
devices both outright and under finance leases 
as well as with related service and warranty 
income we expect this trend to continue in 
future years as we expand internationally both 
through direct sales and distributor relationships 
and penetrate further into ophthalmology and 
towards the introduction of our next generation 
desktop scanning devices and oct products 
as disclosed at the interim results we have 
reassessed the anticipated useful life of our 
current product range from an accounting 
perspective and as a consequence now expect 
the majority of new and renewed rental contracts 
to fall to be treated as sales under finance leases 
rather than operating leases during the year we 
secured 415 finance lease contracts compared 
to 88 in 2010
our revenues grew by 35 to 1433m 
2010 1063m and include 376m from 
outright sales of devices 2010 81m and 
198m from sales under finance leases 
2010 77m included within these outright 
sales were 30m of revenues from products 
acquired with opto global which were consolidated 
from january 2011 revenues from the recurring 
streams of operating lease rentals and service 
and warranty revenues fell from 905m in 
2010 to 859m this year 
adjusting revenues in both the current and 
prior financial year to treat all receipts under 
rental contracts as if they were operating leases 
and deducting revenues from the opto global 
products resulted in likeforlike growth in 
revenues of over 25
our core north american markets generated 
revenues of 1171m 2010 934m an increase 
of 23 with markets outside north america growing 
strongly by 103 from 129m to 262m 
4optsar11frontjennylesleyshindd   20 17012012   110734 optos plc annual report and accounts 2011 21
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this growth included expansion in our direct 
markets in europe sales through new distributor 
relationships and first direct sales in australia 
and new zealand
our customer base for core optos scanning devices 
increased from 3912 to 4240 during the year with 
811 devices owned outright and 80 or 3429 
on rental contracts of these 487 classify as finance 
leases we sold 529 devices in 2011 compared 
to 115 in 2010 influenced by the broader range 
of business models and sales through distributors 
and to ophthalmology customers
our asset utilisation efforts remained effective 
with the average monthly optomaps® for the year 
being 112 compared to 110 last year 
future minimum revenues receivable under 
noncancellable operating lease contracts at the end 
of 2011 fell from 1698m to 1059m although 
a further 374m is due under noncancellable 
contracts accounted for as finance leases of 
which 258m is recognised in the balance sheet 
gross and operating profits and net finance costs
gross profits increased by 205m to 914m 
representing a gross margin of 64 compared to 
67 in 2010 a year where the impact of higher 
margin finance lease contracts skewed the 
overall picture 
overheads before exceptional items increased 
from 534m in 2010 50 of revenues to 663m 
46 of revenues reflecting higher selling costs 
with an expanded sales force and commissions 
on higher sales increased volumes of device build 
and refurbish increased internationalisation of 
products and the addition of the opto global 
operations with the launch of daytona and the 
addition of new markets further products including 
optosadvance and the oct and ultrasound devices 
we anticipate further increases in revenues and 
overheads in the coming year
operating margins before exceptional costs 
increased from 16 to 175 this year delivering 
operating profits of 251m 
average numbers of employees increased 
from 277 to 364 with 395 actual employees 
at the year end staff costs for the year were 
444m compared to 302m in the previous 
year reflecting the higher staff numbers and 
increased incentive payments arising from 
improved revenue and profit performance 
investment in upgrading certain key positions 
and in employee development
interest charges and other finance costs reduced 
from 50m in 2010 to 33m reflecting the 
continuing reduction in vendor finance debt 
finance revenue of 09m 2010 02m was 
comprised primarily of the implied discount 
within finance lease rental contracts
exceptional items and acquisitions
exceptional items incurred in the year included 
24m of costs relating to the acquisition of 
opto global completed in december 2010 and 
the opko health device business completed after 
the current year end in october 2011 these 
charges were offset by a 175m credit relating 
to a reassessment of the deferred consideration 
payable for opto global opto global was 
purchased for 1175m of which 1075m was 
settled in cash and the balance through the 
issue of 434487 new shares in optos plc 
the contracts also allowed for payment of 
deferred consideration of up to 3m depending 
on sales performance for the twelve months 
from 1 march 2011 
at the time the acquisition was secured the 
board assessed the likely deferred consideration 
to be 25m and a provision of that amount 
was established since that time whilst overall 
performance of the opto global business has 
been good with prospects for product sales 
in australia looking particularly exciting the 
requirement for the “base” opto global business 
to achieve a floor of 5m of revenue in the 
measurement year looks challenging the contract 
states no consideration should be paid if this 
hurdle is not met accordingly the directors 
now assess a maximum of 075m of deferred 
consideration is likely to be payable and the 
reduction in the provision released to the 
profit and loss
profit on ordinary activities before tax taxation 
and post‑ tax profits
the group made a profit on ordinary activities 
before tax of 227m and a profit of 220m 
after exceptional items compared to 127m 
in the prior year 
a tax credit of 08m arose in the year 
2010 13m comprising a current tax credit 
of 05m on release of provisions made in prior 
periods and a deferred tax credit of 03m as 
all recognisable brought forward tax losses were 
brought in to deferred tax assets the effective 
tax charge on the current year profits was largely 
matched by the recognition of an additional 
66m of deferred tax asset 
with effect from 2012 the group anticipates 
recognising a full tax liability on its future profits 
although in cash terms would not anticipate 
paying significant taxes in the uk until 2013 
or beyond although some taxes are likely to be 
payable in the us where losses will be utilised 
sooner and in other territories such as canada 
and germany
the resultant posttax profit after exceptional 
items was 228m representing undiluted 
earnings per share of 321c compared with 
200c in the previous year
over 80 of our core 
imaging devices are 
placed with customers 
on a rental basis giving 
good visibility of 
future revenues
the acquisition of 
opto global delivered 
30m of revenues from 
new products as well 
as synergies from new 
sales channels 
4optsar11frontjennylesleyshindd   21 17012012   110734 optos plc annual report and accounts 2011 22
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financial statements
as the business expands to cover a 
range of products and business models 
the measures by which performance 
is managed will move towards overall 
growth in revenues operating margins 
and cash generation together with the 
maintenance and expansion of the 
customer base
measures relating to the payperpatient 
optomap® imaging business whilst of 
great importance will have less relevance 
to the overall group results in future 
periods as the product range expands 
and are included for information only 
this year 
cash flow
during 2011 we invested significant cash in 
the business acquired opto global launched 
into ophthalmology entered new geographies 
and increased research and development spend 
as well as prepared for both the acquisition 
of the opko health instrumentation business 
and the daytona launch
as a consequence cash flow from operating 
activities was 372m compared to 464m in 
2010 adding back cash receipts from finance 
lease receivables and interest of 34m disclosed 
within investing activities increases adjusted 
operating cash flows to 406m compared 
with 468m 
manufacturing operations in 2010 related largely 
to p200 and 200dx devices which were already 
owned by the business and required little additional 
investment other than the costs of refurbishing 
devices and establishing new customer sites in 
2011 we built significant numbers of new devices 
in addition to refurbishing existing products and 
also increased inventories as we moved to supply 
higher volumes of 200tx devices the daytona 
launch and adding opto global products debtors 
were high as a result of high capital sales 
towards the end of the year
investing activities used 378m 2010 185m 
net of finance income and finance lease receipts 
with the acquisition of opto global for 1075m 
significant expenditure on intangible assets and 
in building and refurbishing medical devices 
the intangible asset expenditure of 65m relates 
largely to the capitalisation of costs of internal 
rd projects with the daytona project representing 
the majority of this expenditure 
net cash flows from financing activities resulted 
in a net cash outflow of 307m 2010 167m 
with vendor finance repayments of 315m and 
receipts of 36m compared with payments of 
374m and receipts of 242m in 2010 
cash balances fell by 310m in the year to 
102m whilst finance lease obligations reduced 
by 269m from 623m to 354m giving net 
debt at the year end of 252m compared to 
211m at the start of the year
balance sheet
shareholders’ equity and net assets at the 
year end were 1005m a 255m increase 
principally reflecting the profit for the year 
share issuance proceeds and adjustment for 
sharebased payments 
noncurrent assets increased from 878m 
to 976m with reductions in property plant 
and equipment through transfers of devices 
to inventories offset by increased finance lease 
receivables and intangible assets arising on 
rd projects and the opto global acquisition 
current assets increased to 665m with an 
110m increase in trade receivables reflecting 
high sales towards the year end and inventories 
up 188m including 102m of assets transferred 
from ppe and increases in other devices 
including opto global
within trade and other payables the increase 
of 145m included a 72m increase in deferred 
revenue with some 87m of future revenue 
secured much relating to service and warranty 
contracts to be recognised in future years as 
well as higher accrual levels reflecting increased 
business activity
across the approximately 3000 devices on 
operating lease agreements the carrying value 
of medical devices was 366m at the year end 
an average carrying value of approximately 
125k with the newer p200c and p200ma 
devices typically carried at a higher value 
than the p200 and 200dx devices
christine soden
chief financial officer
21 november 2011
business review
financial review continued
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financial statements
key performance indicators
financial
operational
revenue growth
growth driven by new products 
markets and business models 
business target 20 pa growth 
over mediumterm 
revenue growth versus prior year is the 
total revenue for the year divided by the 
total revenue for the prior year 
underlying revenue growth
driven by increased capital sales 
into new segments and markets
26
4
15
2011 2009 2010
underlying revenue growth is calculated 
by treating all payments receivable in the 
period from rental contracts as operating 
leases including revenues from outright 
device sales and service contracts but 
excluding revenues from opto global 
and accutome products 
10
0
10
20
30
operating margin before  
exceptional items
steady improvement towards 
longterm target of margin 
of 20 
175
9
16
2011 2009 2010
0
20
4
12
16
8
operating margin before exceptional items 
is the gross profit less selling distribution 
and administrative expenses excluding 
exceptional costs divided by revenues 
adjusted operating cash flow 
per share cents
increases in working capital in 
year as we build and introduce 
new products
567c
538c
662c
2011 2009 2010
0
75
15
45
60
30
adjusted operating cash flow per share is 
the cash flow from operations plus amounts 
receivable from finance lease contracts in 
the period divided by the average number 
of shares in issue for the year as used in 
calculating the diluted earnings per share
free cash flow m
fy11 was a year of significant 
investment in rd new products 
and new markets
102
180
277
2011 2009 2010
0
25
5
15
20
10
free cash flow is operating cash flow 
less cash used in investing in tangible 
and intangible assets and cash receipts 
from finance lease receivables before 
the costs of acquisitions
30
average price per optomap® 
expect continued reduction as we 
offer more competitive pricing 
based on lower cost of devices
181
197
185
2011 2009 2010
0
5
15
10
20
112
105
110
2011 2009 2010
0
120
20
60
80
100
40
target is to increase optomap® 
usage through demonstrating 
clinical proof of medical benefits
average number of monthly 
optomaps® per rental site
number of rental customer 
sites at year end
3000
2008
4250
3250
3500
3750
4000
3000
3429
3625 3630
4250
3250
3500
3750
4000
2011 2009 2010
whilst a declining proportion of 
our customer base rental sales 
remain core to optos’ business 
total number of devices  
at customer sites
3000
3983
3797
3912
4250
3250
3500
3750
4000
3000
3797
3912
4250
3250
3500
3750
4000
2011 2009 2010
in addition we have customers for 
our other products plus multiple 
products at some sites
site numbers refer only to core widefield 
imaging products
4240
5
12
10
2011 2009 2010
0
12
2
6
8
10
4
the range of business models 
available has helped persuade 
customers to retain their devices 
 of customers deinstalling
the percentage of customers deinstalling 
is the number of sites deinstalling divided 
by the average total customer base the 
average number of optomap® eye exams 
sold relates to actual eye exams undertaken 
by healthcare professionals under rental 
agreements and billed to patients
35
4
9
2011 2009 2010
10
0
10
20
30
40
4optsar11frontjennylesleyshindd   23 17012012   110735 optos plc annual report and accounts 2011 24
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principal risks and uncertainties
there are a number of potential risks and uncertainties that have been identified 
within the business which could have a material impact on the company’s long‑ term 
performance these are not all of the risks which the directors have identified but 
those that the directors currently consider likely to be material
area of risk potential impacts mitigating activity
the successful launch of the 
daytona product is critical to the 
longterm growth of the company
the company is currently heavily reliant on its p200 and p200c medical devices which 
produce the company’s retinal exam products and are principally targeted at optometry 
customers these products together with related services accounted for the majority 
of the company’s revenues for the year ended 30 september 2011 if any thirdparty 
produces a more advanced device with improved functionality to these devices or a 
similar device with significantly lower build costs this could have a material adverse 
effect on the company’s business financial condition and results of operations 
the company has invested significantly in the development of a new desktop sized 
“plug and play” device which is being branded as daytona the daytona product was 
unveiled in october 2011 and will go on sale in the first calendar quarter of 2012 as 
with any new product there are risks associated with the ability to build to the cost and 
the volume required as well as risks relating to the continued success of the existing 
product range
to mitigate this we have created a new product 
introduction team which is specifically responsible 
for transferring the product from product development 
through scaleup into fullscale manufacturing to ensure 
that the daytona product can be built to meet the market 
demand in a costeffective way in addition the new 
design is modular based and therefore is less complex 
to manufacture than existing products the company 
has taken specialist marketing advice on how best to 
position the daytona device to reduce the risk of 
cannibalisation pricing programmes have been 
established in the marketplace
the company is projecting 
significant growth in new 
territories as well as 
increasing penetration into 
the ophthalmology sector
the company currently generates most of its revenue in the optometry sector within 
north america 
the company seeks to address the risk of overreliance on one sector and one market 
through investing significant resources in building sales and distribution resources 
outside the north american optometry market building direct and indirect sales 
channels to address ophthalmology and specialist markets and in additional territories 
furthermore the company has invested in demonstrating the clinical efficacy and 
superiority of its devices and developing the quality and functionality of its products 
in order to seek to address competitive threats 
the company is continuing to develop the p200tx device to 
include new features and applications that will further meet 
the customer needs in particular within the ophthalmology 
sector through the recent acquisitions the company now 
has access to an established distributor network upon 
which to build and so increase market penetration into 
new regions this is further supported through clinical 
studies the developing p200tx product and the new 
daytona device
4optsar11frontjennylesleyshindd   24 17012012   110735 optos plc annual report and accounts 2011 25
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area of risk potential impacts mitigating activity
the growth of the company’s 
business particularly as it enters 
the ophthalmology sector and new 
territories is dependent on it 
manufacturing its devices in a 
costeffective and repeatable way 
the company’s devices are complex and expensive to build and rely on a number of 
specialist components and parts 
in order to improve security of supply the company 
is developing the ability to manufacture repair and refurbish 
its devices at both its manufacturing sites and will hold 
supplies of parts at dual locations where a product is single 
sourced the company seeks to hold sufficient inventories 
to manage expected demand the company’s development 
teams run projects to reduce the cost of building devices 
and in developing daytona as discussed opposite the team 
is seeking to place more reliance on readily available 
component and technologies rather than the current 
reliance on specialist manufacture and supply
the company has made two 
acquisitions in the last year 
there is a risk that they are 
not fully integrated and so 
the synergies are not achieved 
in october 2011 the company acquired the assets and business of the instrumentation 
division of opko health inc the company is therefore now engaged in the development 
manufacture and sale of optical coherence tomography “oct” diagnostic devices and 
optical ultrasound scanners the successful integration and launch of the existing oct 
products and the development of the new oct products is a key risk
in december 2010 the company acquired opto global pty holdings ltd the company 
sources and sells precision optometric and ophthalmic equipment with markets primarily 
in the middle and far east as well as africa and south america 
the acquisition enhances the optos product range and offers the opportunity to launch 
the sale of optos products through key opto global distributors the acquisition also 
provides a direct selling route for optos products into australia as described opposite 
the company appointed an integration team there are no manufacturing processes to 
assimilate as all products are sourced from third parties although there were some 
initial delays the opto global product range is now integrated and the company is using 
the opto global distributors to sell both optos and opto global products there has also 
been success selling optos products into australia managing the supply chain is a key 
risk and this has been integrated within the overall company’s logistics management
to mitigate this risk the company has an experienced 
integration team in place to manage the transition 
the acquired products are sold through the same channels 
and to the same customer groups as the existing products 
the manufacturing processes are relatively straightforward 
and within the scope of the company’s existing manufacturing 
experience the sales team has all been given training on 
the new devices and marketing material produced to support 
the new products the new product development programmes 
are nearing completion and will be integrated within the 
existing optos project management systems
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principal risks and uncertainties continued
the company’s operating 
results and financing capacity 
could be adversely affected 
by the current fragile economic 
position at the same time the 
company is launching new 
products and expanding into 
new areas although the 
company has new financing 
in place there are covenants 
attached that need to be 
monitored and met
any significant downturn in economic markets would be likely to impact adversely on 
disposable incomes which may in turn result in reduced public demand for the company’s 
products and thereby materially and adversely affect the company’s business and financial 
position a reduction in footfall in optometrists’ offices or closure of those offices could 
adversely impact the company’s ability to earn revenues from optomap® examinations 
above the mmp and might cause a reduction in the renewal rate of contracts
in addition as the company continues to develop and launch new products as well 
as expand into new regions there will be increased cash requirements including 
working capital
the company does however benefit from good visibility 
of secured forward revenues through its contracts that 
typically have a term of around three years although there 
can be no guarantee that customers will not default under 
those contracts also the company is now selling a higher 
proportion of its products as capital sales and thereby 
receiving the cash earlier the company will closely monitor 
its covenant compliance and there is flexibility within the 
facility to draw down additional secured lending if required
area of risk potential impacts mitigating activity
the company is subject to pricing 
pressures in common with other 
consumerbased businesses and 
relies in part on reimbursement 
agreements with insurers and 
government health authorities
there can be no guarantee that the company can deliver continued increases in revenue 
nor can there be any certainty that the optomap® image or any other procedure will 
continue to qualify under health reimbursement schemes or that the reimbursement 
rates will not decrease the company may also be subject to healthcarerelated taxes 
imposed by government agencies such as a medical devices tax that is to be introduced 
by the us government 
the nearterm success of the company’s business depends 
on consumers understanding the benefit of regular optomap® 
examinations at the price offered by the company and 
healthcare professionals the company seeks to drive 
adoption and awareness of its product through strong 
educational programmes and compelling evidence from 
clinical studies
4optsar11frontjennylesleyshindd   26 17012012   110736 optos plc annual report and accounts 2011 27
overview
business review
governance
financial statements
intellectual property suits 
that are brought against the 
company may significantly 
harm the business as could 
significant litigation 
technologybased companies are frequently subject to litigation with respect to patent 
and other intellectual property rights any litigation to determine the validity of thirdparty 
infringement claims or defend the company’s intellectual property could at a minimum 
be costly the company believes the core patent protection around its product is strong 
and is not aware of any significant actual or pending suits the company’s business 
exposes it to the risk of certain litigation for example a patient suffering harm during 
the image process or the company’s retinal image system not identifying an underlying 
medical problem 
the company does not offer diagnostic or treatment services 
and its customers are all qualified eyecare clinicians who are 
fully trained in the use and interpretation of the optomap® 
product the company maintains product liability insurance 
although there can be no certainty the insurance coverage 
would be sufficient to meet the cost of any claims
the company’s business is 
international and it operates 
in several countries and 
currencies and its results 
are impacted by changes in 
currency exchange rates
optos reports its results in us dollars the currency in which the majority of its revenues 
and costs arise the group monitors its nonus dollars foreign currency exposure and 
when deemed necessary by the board seeks to minimise its transaction exposure by 
using forward foreign currency contracts to eliminate exposures on any committed 
significant transactions 
wherever possible the majority of cash balances are 
maintained in us dollars to mitigate the impact of 
currency fluctuations 
area of risk potential impacts mitigating activity
the company operates in a 
highly regulated industry 
the company’s medical devices are subject to strict us federal food and drug 
administration “fda” regulations and the requirements of similar foreign regulatory 
bodies although the company’s devices are currently fda cleared to market if the 
company or its thirdparty manufacturers fail to satisfy regulatory requirements or 
regulations change this could result in the imposition of sanctions on the company 
or cause the company to be unable to sell its product in certain markets or face 
adverse publicity
the company operates to relevant iso guidelines 
and monitors and anticipates developments in 
regulatory thinking
4optsar11frontjennylesleyshindd   27 17012012   110736 optos plc annual report and accounts 2011 28
roy davis
chief executive officer
roy davis joined the company 
as chief executive officer with 
effect from 17 november 2008 
with over 25 years of operational 
line management and strategic 
consulting experience mr davis was 
chief executive officer of gyrus group 
plc a quoted leading medical device 
company from june 2007 before 
it was acquired by the olympus 
corporation of japan in february 2008 
before becoming ceo he served as 
chief operating officer of the company 
from 2003 mr davis joined gyrus 
as a nonexecutive director at the 
time of its flotation in 1997 he 
was previously ceo of ntera 
a nanotechnology company and 
before that spent almost ten years 
with arthur d little the global 
management consulting company 
where he was vice president and 
global head of its operations 
management business mr davis has 
also held senior operational positions 
for tricom reuters and molex in the 
us taiwan and europe mr davis 
holds a mechanical engineering 
degree and obtained an mba from 
the london school of business
christine soden
chief financial officer
christine soden joined optos as chief 
financial officer in september 2009 
and was appointed to the board on 
1 december 2009 she joined optos 
from btg plc the ftse 250 speciality 
pharmaceuticals company where 
she became chief financial officer 
in 2005 following the acquisition 
of protherics plc in december 2005 
christine became chief operating 
officer of btg and helped integrate 
the two businesses prior to btg 
between 2000 and 2005 christine 
was chief financial officer at oxagen 
limited a privately owned drug 
discovery company and from 1996 
until 1999 christine was finance 
director of chiroscience group plc 
before becoming chief financial officer 
of celltech chiroscience plc following 
the merger of the two companies 
prior to this christine spent over 
four years as group financial controller 
of medeva plc she has a degree in 
mathematics from durham university 
and is a chartered accountant
dr peter fellner a•r•n
nonexecutive chairman
dr fellner joined the company 
as chairman with effect from 
1 january 2010 previously dr fellner 
served as ceo of celltech group plc 
from 1990 to 2003 and oversaw its 
growth from an earlystage rd 
company valued at about £50m 
into the uk’s largest biotechnology 
company a constituent of the ftse 
100 index and also listed on the 
nyse he then served as its chairman 
from 2003 until its acquisition for 
£153 billion in 2004 dr fellner joined 
celltech from roche uk where he 
served as ceo from 1986 to 1990 
having previously been director of 
the roche research centre in the uk 
dr fellner currently serves as chairman 
of the medical technology company 
consort medical plc and of the 
biotechnology companies vernalis plc 
astex therapeutics ltd and biotie 
therapies corp he is also a director of 
the global biopharmaceutical company 
ucb sa and of the european bioscience 
company evotec ag recently he also 
served as chairman of the biotechnology 
company acambis plc and of premier 
research group plc a cro until they 
were each acquired during 2008
governance
board of directors
chairman’s overview
during the accounting period the board comprised two 
executive directors roy davis chief executive officer “ceo” 
and christine soden chief financial officer “cfo” the 
nonexecutive directors comprised dr peter fellner 
dr peter kehoe barry rose and rosalyn wilton patrick paul 
resigned from the board as a nonexecutive director as at 
23 february 2011 and john goddard and david wilson 
were appointed to the board as nonexecutive directors 
with effect from 1 june 2011
the company’s nonexecutive directors provide input to 
the business by contributing to the oversight function of 
the board and to the development of the company’s strategy 
the nonexecutive directors met as a group on two occasions 
during the financial year ended 30 september 2011 
without the presence of executive directors
the board met 13 times during the year including once 
over a twoday period with senior management to focus 
on strategy and business planning
the board delegates to the company’s operating board 
which is chaired by the ceo and comprises the company’s 
senior management and meets on a monthly basis certain 
decisions including implementing the strategy operational 
plans and policies of the company and the company’s 
subsidiary companies as determined by the board delivering 
the operating and financial results against budgets and 
managing and controlling the allocation of capital human 
and technical resources
dr peter fellner chairman
3optsar11middlejennyshindd   1 17012012   110632 optos plc annual report and accounts 2011 29
overview
business review
governance
financial statements
john goddard fca a•n
nonexecutive director
mr john goddard fca joined the 
company as a nonexecutive director 
in june 2011 mr goddard has had 
a distinguished career in the global 
pharmaceuticals industry the majority of 
which was with astrazeneca where he 
was ultimately head of group strategic 
planning he has extensive experience 
of mergers and acquisitions and had 
significant involvement in the merger 
of astra and zeneca prior to his 
retirement from astrazeneca last 
year mr goddard was responsible 
for building a 100strong global team 
focused upon ma and licensing 
which completed 75 transactions in 
four years including several acquisitions 
inlicensing and outlicensing of 
compounds and disposals latterly 
mr goddard became chairman of the 
astrazeneca spinout aptium oncology 
and of the substantial medical device 
business astratech mr goddard is 
a member of the board of directors 
of intas pharmaceuticals ltd and 
renovo group plc and serves on the 
advisory board of dri capital inc
david wilson r•n
nonexecutive director
mr david wilson joined the company as 
a nonexecutive director in june 2011 
mr wilson has 26 years of experience 
in the city and is currently deputy 
chief executive of the investment 
banking business at matrix group 
until february this year he was the 
chief executive of piper jaffray ltd 
a position he held from 2005 mr wilson 
helped launch the firm’s investment 
banking and ma advisory service in 
europe which became a marketleading 
healthcare franchise he was appointed 
to the operating board of piper jaffray 
 co the usbased parent company 
in 2008 and as chairman of the firm’s 
global healthcare group in 2010 
he has extensive global fundraising 
and crossborder ma experience 
previous positions include joint 
head of uk investment banking at 
ing barings director of investment 
banking at deutsche bank and head 
of small companies corporate 
broking at ubs
dr peter kehoe r•n
nonexecutive director
dr kehoe joined the company as a 
nonexecutive director in october 2010 
since 1984 dr kehoe has been a 
principal of kehoe eye care pc in 
galesburg illinois usa from 1997 to 
1998 dr kehoe served as president of 
the illinois optometric association and 
received their optometrist of the year 
award in 2001 he served on the 
board of trustees of the american 
optometric association from 1999 to 
2010 and as president of the 36000 
member organisation in 2008 to 2009 
dr kehoe serves as a north american 
representative on the governing board 
of the world council of optometry 
in 2010 he was named as a consultant 
to transitions optical serving as a 
professional relations adviser 
dr kehoe holds an od degree and 
a doctor of science from the illinois 
college of optometry chicago he 
became a fellow in the american 
academy of optometry in 1999 and 
is an active candidate of the american 
board of optometry
barry rose a•r•n
nonexecutive director
barry m rose joined the company 
as a nonexecutive director in 
december 2005 and serves as the 
senior independent director to the 
board and as chairman of the audit 
committee mr rose was chief executive 
of scottish provident uk from 1993 to 
2001 he is chairman of baillie gifford 
shin nippon plc mr rose is also a 
nonexecutive director of wolfson 
microelectronics plc and dimensional 
imaging ltd mr rose has an honours 
degree in mathematics from 
manchester university
rosalyn wilton a•r•n
nonexecutive director
rosalyn wilton joined the company 
as a nonexecutive director in 
august 2007 and serves as chairman 
of the remuneration committee 
mrs wilton stepped down in 
october 2009 as chairman of 
ipreo holdings llc the usbased 
financial data and solutions group 
which was formed following the 
merger of ideal llc and hemscott 
group ltd before the merger 
mrs wilton was chief executive 
officer of hemscott plc mrs wilton 
has previously served as managing 
director of reuters information 
services and reuters transactions 
products and was a member of 
the reuters executive committee 
mrs wilton has held nonexecutive 
directorship positions with scottish 
widows and the london international 
financial futures exchange mrs wilton 
serves as a senior adviser to 
3i investments mrs wilton holds 
a bsc hons from the university 
of london
3optsar11middlejennyshindd   2 17012012   110658 optos plc annual report and accounts 2011 30
governance
operating board
mike geraghty
executive vice president global sales
mike geraghty joined the company in 
february 2009 he has over 25 years 
of sales management experience in the 
medicalsurgical field and an extensive 
national and international background 
most recently he served as president 
of international sales and before that 
president of north america sales at 
gyrus acmi where he helped grow 
annual sales from 12m to 400m
alex warnock
vice president global research 
and development
alex warnock joined the company 
in 2008 he has extensive experience 
in international markets and broad 
npi experience with complex electronic 
products he has held the positions 
of director global cas technology and 
development for depuy iorthopaedics 
a division of jj divisional vp and 
senior gmvp engineering at pace micro 
technology and european operations 
manager at motorola he holds a bsc 
in electrical and electronic engineering 
an msc in digital systems engineering 
and is a chartered engineer ceng
tom daniells
vice president global corporate 
accounts and business development
tom daniells joined the company 
in 2003 he has over 25 years of 
experience in the ophthalmology and 
optometry business holding previous 
positions as worldwide business 
director – cataract and director of us 
sales at becton dickinson director of 
marketing at summit autonomous and 
16 years in managerial marketing roles 
at alcon he holds a ba in marketing 
and an mba in international marketing
tom motta
vice president global operations
tom motta joined the company in 
august 2009 he possesses an indepth 
knowledge of and experience in lean 
manufacturing methodologies and 
improved plant performance he holds 
an msc total quality and has over 
ten years’ global executivelevel 
management experience in operations
manufacturing with medical device 
companies including olympusgyrus 
acmi and teleflex medical formerly 
genzyme biosurgery most recently 
he served as group vice president 
of operations for the americas at 
olympusgyrus acmi
robert tweedlie
vice president global quality 
assurance and regulatory affairs
robert tweedlie joined the company 
in 2002 he has spent 17 years in 
various manufacturing industries 
including photographic electronic 
and plastic injection moulding before 
specialising in medical devices 
he joined inverness medical ltd 
now lifescan scotland in 1996 
at inverness medical he managed 
the regulatory implications of product 
launch through to acquisition by 
johnson  johnson he holds a phd 
in protein xray crystallography
3optsar11middlejennyshindd   3 17012012   110706 optos plc annual report and accounts 2011 31
overview
business review
governance
financial statements
douglas anderson
vice president global advocacy
douglas anderson founded the 
company in 1992 he is a fellow 
of the royal society of edinburgh 
a fellow of the royal society of 
arts a doctor hon of engineering 
herriot watt university edinburgh a 
doctor hon of business administration 
– edinburgh napier university and 
a member of the association for 
research in vision and ophthalmology 
in 2007 he was made an officer 
of the british empire for services 
to life sciences he is chairman of 
crombie anderson associates ltd 
and nonexecutive director of 
michelson diagnostics ltd
jairo kerr azevedo
vicepresident global field services 
managing director optos australia
jairo kerr azevedo has 15 years 
of experience in the ophthalmology 
industry having held management 
roles with global ophthalmology 
equipment manufacturers in the 
areas of technical support and 
services product management and 
sales jairo joined optos in 2010 
through the acquisition of opto global 
a company that he founded in 2003 
and served as chief executive officer 
he holds an electrical engineering 
degree from the university of sao paulo 
brazil and an mba from the university 
of adelaide australia
dan wood
vice president strategy and 
operations integration
dan wood joined the company in 
2011 he has 20 years of international 
management experience including 
startups and global medical device 
manufacturers he joined optos from 
olympus where he was vp of supply 
chain and integration overseeing 
gyrus’ integration of acmi and then 
gyrusacmi’s subsequent integration 
in to olympus he holds an msc in 
engineering and economics from 
lincoln college oxford
3optsar11middlejennyshindd   4 17012012   110722 optos plc annual report and accounts 2011 32
governance
corporate governance
 “ we continue to manage the company’s affairs 
in accordance with the principles and provisions 
of the uk corporate governance code”
 dr peter fellner chairman
the board remains committed 
to ensuring that high standards 
of corporate governance 
are maintained
chairman’s statement 
pages 06–07
for a review of the functions of the board
page 33
corporate governance code
the board of directors the “board” remains 
committed to ensuring high standards of 
corporate governance are maintained and 
continues to manage the company’s affairs in 
accordance with the principles and provisions of 
the uk corporate governance code the “code” 
june 2010 
statement of compliance
the board considers that the company has 
complied with the principles and provisions 
set out in the code throughout the year ended 
30 september 2011
board of directors
the principal duty of the board is to represent 
and protect the interests of the company’s 
shareholders by ensuring that the company 
is wellmanaged and operated in a way which 
is in the interests of its shareholders the board 
is responsible for oversight of the formulation 
and implementation of the strategy of the 
company the board is also responsible for 
oversight of the company’s operations and has 
an obligation to keep informed of the company’s 
activities and appropriate policies and 
procedures in order to assist management in 
formulating developing and implementing plans 
and serves as a body to review and provide 
advice to management on the operations of the 
company the board is committed to reviewing 
its membership on a regular basis the chairman 
ensures that board discussions are conducted 
taking all views into account so that no one 
individual director or small group of directors 
dominate the proceedings
chairman and chief executive officer
there is a distinct and defined division of 
responsibilities between the chairman and the 
chief executive officer “ceo” the chairman is 
primarily responsible for the effective working 
of the board and the ceo is responsible for the 
operational management of the business and 
for the implementation of strategy as agreed by 
the board the division of responsibilities is 
reviewed annually by the board
board balance and independence
during the accounting period the board comprised 
two executive directors roy davis ceo and 
christine soden cfo the nonexecutive directors 
comprised dr peter fellner dr peter kehoe 
barry rose and rosalyn wilton patrick paul 
resigned from the board as a nonexecutive 
director as at 23 february 2011 and john goddard 
and david wilson were appointed to the board 
as nonexecutive directors with effect from 
1 june 2011
patrick paul was presumed not independent 
within the meaning of the code because he 
served on the board for more than nine years 
since first elected and held significant interests 
in the shareholding of the company 
as at 30 september 2011 all of the nonexecutive 
directors were independent as provided for by 
the uk corporate governance code
role of nonexecutive directors
the company’s nonexecutive directors 
provide input to the business by contributing 
to the oversight function of the board and to 
the development of the company’s strategy 
nonexecutive directors are required to be 
satisfied that the financial information is accurate 
and that the internal controls and policies and 
procedures governing risk management are 
effective and appropriate the company’s 
nonexecutive directors are available to 
shareholders the nonexecutive directors 
met as a group on 2 occasions during the 
financial year ended 30 september 2011 
without the presence of executive directors 
board process and information
the board met 13 times during the year 
including once over a twoday period with senior 
management to focus on strategy and business 
planning dialogue occurs regularly between 
directors outside of scheduled meetings meeting 
agendas include review and approval of minutes 
recorded of the previous meeting matters arising 
items for discussion special items items for note 
3optsar11middlejennyshindd   5 17012012   110724 optos plc annual report and accounts 2011 33
overview
business review
governance
financial statements
board process and information continued
and any other business board materials are 
distributed by the company secretary normally 
not less than seven days in advance of meeting 
dates to allow directors to adequately prepare 
for meetings minutes of board and committee 
meetings are normally distributed within 14 days 
following each meeting 
the board receives operational and financial 
information to assist in monitoring and assessing 
the ongoing performance of the business on a 
monthly basis this includes reports from the 
ceo cfo and company secretary the board 
also schedules and reviews special items 
covering business critical areas during the year 
the executive with responsibility for the special 
items submits a written report covering the items 
which is included in the board materials and 
attends the board meeting by invitation for that 
part of the agenda to discuss the report in detail 
noone other than directors and the company 
secretary is entitled to be present at board 
meetings unless specifically invited to attend 
in those instances when a director has been 
unable to attend board or committee meetings 
his or her comments on the papers for that 
meeting are communicated to the chairman in 
advance so that they can be duly considered
functions of the board
the board acknowledges and accepts its statutory 
duties and in doing so encourages the longterm 
success of the company by exercising independent 
judgement with respect to material strategic and 
operational issues safeguarding corporate assets 
by reviewing the financial policies and affairs of 
the company and overseeing the company’s 
financial reporting process and internal controls 
reviewing of the adequacy of the company’s 
systems for compliance with all applicable laws 
and regulations overseeing the company’s risk 
management process and ensuring that the 
company has appropriate procedures in place 
to manage risks and evaluating the effectiveness 
of the board and its committees at least annually 
the board delegates to the company’s operating 
board which is chaired by the ceo comprised 
the company’s senior management and meets 
on a monthly basis certain decisions including 
implementing the strategy operational plans and 
policies of the company and the company’s 
subsidiary companies as determined by the 
board delivering the operating and financial 
results against budgets and managing and 
controlling the allocation of capital human 
and technical resources
senior independent director
the code recommends that the board should 
appoint one of its independent nonexecutive 
directors to serve as the company’s senior 
independent director “sid” barry rose is 
the sid for the company mr rose is available 
to shareholders employees can contact the 
sid under the provisions set out in the group’s 
“whistleblowing policy” if they have concerns 
that have not been resolved through normal 
channels or for which contact through the 
normal channels is inappropriate 
accountability and audit 
all directors have accepted a duty of care 
and accountability to act in the interests of the 
company the audit committee has a particular 
role acting independently from management 
to ensure that the interests of shareholders are 
properly protected relative to financial reporting 
and internal control 
risk management and internal control
the board confirms that there is an ongoing 
process for identifying monitoring evaluating 
and managing the company’s significant risks 
that such a process has been in place for the year 
ended 30 september 2011 and up to the date of 
approval of the annual report and accounts that 
it is regularly reviewed by the board and that it 
accords with the internal control guidance for 
directors relative to the code
governance structure
board of 
directors
audit committee remuneration 
committee
nomination 
committee
the audit committee 
has responsibility for 
planning and reviewing 
the company’s interim 
and preliminary reports 
and accounts
the remuneration 
committee is responsible 
for the policy for the 
remuneration of the 
executive directors 
company secretary and 
the operating board
the nomination 
committee has 
responsibility to 
assist the board with 
succession planning and 
with the selection of a 
new director or chairman
barry rose  
chairman
other members 
dr peter fellner 
rosalyn wilton 
john goddard
rosalyn wilton  
chairman
other members 
dr peter fellner 
barry rose 
dr peter kehoe 
david wilson
dr peter fellner 
chairman
other members 
all nonexecutive 
directors
full biographies of the board
pages 28–31
3optsar11middlejennyshindd   6 17012012   110724 optos plc annual report and accounts 2011 34
governance
corporate governance continued
risk management and internal control continued
the directors acknowledge that they have overall 
responsibility for the company’s system of internal 
control and for reviewing its effectiveness the 
board continued to apply c2 of the code by 
establishing a continuous process for identifying 
evaluating and managing the risks that are 
considered significant its system is designed to 
manage the risk and can only be a reasonable 
and not absolute assurance against material 
misstatement or loss 
a group risk and control framework has 
been established and includes a range of controls 
including financial operational and compliance 
it is based principally on reviewing reports from 
management and considering whether significant 
risks are identified evaluated classified and 
controlled and ensuring that any significant 
weaknesses are promptly and properly remedied 
this includes manuals of policies and procedures 
applicable to all material aspects of the business 
a budgetary control system which includes 
monitoring actual performance against  
predetermined plans and the appointment 
of suitably qualified and experienced staff 
to execute on their agreed responsibilities 
external audit risk assessment and planning 
is in place the audit committee considers and 
determines relevant action in respect of any 
control issues raised by either the executive 
directors or the external auditors 
there is currently no dedicated internal audit 
function the directors review and determine 
the requirement for a dedicated internal audit 
function on an annual basis the directors have 
determined based on the size and complexity 
of the group that a dedicated internal audit 
function is not currently required if any specific 
internal control weakness is either perceived or 
identified the directors will engage an independent 
thirdparty to carry out additional tests
performance evaluation
the board undertakes an evaluation of its own 
performance and that of its committees and 
individual directors including an assessment of 
the effectiveness of the chairman executive and 
nonexecutive directors and company secretary 
a meeting to conduct a performance evaluation 
of the chairman with the nonexecutive directors 
under the leadership of the sid took place in the 
financial year ended 30 september 2011
board and committee meeting attendance
the board and its committees meet on a regular 
basis to discuss and agree matters which are 
specifically reserved to them for review and 
decision contact between board and committee 
meeting dates is carried out by the directors as 
and when required to discuss and agree matters 
arising relative to addressing and advancing the 
business of the company
appointments and resignations 
john goddard and david wilson were appointed 
to the board as nonexecutive directors on 
1 june 2011 patrick paul resigned from the 
board on 23 february 2011
board committees
the board appoints the members of the audit 
remuneration and nomination committees each 
of which has the responsibility to assist the board 
in its oversight capacity the committees meet at 
regularly scheduled times throughout the year 
and at any other time that may be necessary to 
assist the board in executing its responsibilities 
certain other individuals are invited to attend the 
committee meetings when required and relevant 
to the proceedings the written terms of reference 
setting out the duties and responsibilities of the 
board and its committees are reviewed and 
revised as may be necessary on an annual basis 
committee terms of reference are available from 
the company secretary or on the company’s 
website at wwwoptoscom
board and committee meeting attendance
director  board audit remuneration nomination
number of meetings  13 3 3 1
roy davis  1313 — — —
peter fellner   1313 33 33 11
peter kehoe
1
  1213 — 33 11
barry rose  1213 33 33 11
christine soden  1213 — — —
rosalyn wilton   1213 33 33 11
appointed during year    
john goddard
2
  55 11 — 00
david wilson
3
  55 — 11 00
resigned during year
patrick paul
4
  12 00 — 00
1  peter kehoe was appointed as a member of the remuneration committee on 
22 march 2011 
2  john goddard was appointed to the board as a nonexecutive director on 
1 june 2011 and as a member of the audit committee on 7 september 2011
3  david wilson was appointed to the board as a nonexecutive director on 1 june 2011 
and as a member of the remuneration committee on 7 september 2011
4  patrick paul resigned from the board as a nonexecutive director and all board 
committees as at 23 february 2011
3optsar11middlejennyshindd   7 17012012   110724 optos plc annual report and accounts 2011 35
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business review
governance
financial statements
board committees continued
audit committee 
the audit committee has responsibility for 
planning and reviewing the company’s interim 
and preliminary reports and accounts and in 
engaging the company’s auditors in that process 
the ultimate responsibility for reviewing and 
approving the company’s interim and preliminary 
reports and accounts remains with the board on 
the recommendation from the committee
the audit committee is chaired by barry rose 
and its other members during the year 
included dr peter fellner john goddard from 
7 september 2011 patrick paul through 
23 february 2011 and rosalyn wilton 
the company secretary serves as secretary 
to the audit committee
john goddard barry rose and rosalyn wilton 
are independent within the meaning of the code 
patrick paul was not independent within the 
meaning of the code the code states that the test 
of independence is inappropriate to the chairman 
of the board the code provides for the chairman of 
a listed company below the ftse 350 to be 
a member of but not chair the audit committee 
provided that he or she was independent upon 
appointment peter fellner was independent 
within the meaning of the code on his appointment 
the board considered all members of the 
audit committee throughout the year ended 
30 september 2011 to be independent in 
character and judgement and in possession of 
the relevant business experience and requisite 
financial expertise
the main activities of the audit committee during 
the financial year ended 30 september 2011 
included completing the review of the 
company’s financial results for the year ended 
30 september 2010 and reviewing the interim 
and fullyear results for the year ended 
30 september 2011 and for receiving the 
reports of the external auditors on those 
results considering the audit work carried out 
by the external auditors and any significant 
judgemental and reporting issues identified 
in the auditors’ reports reviewing and discussing 
the risk register that is prepared and monitored 
by the operating board which consists of the 
company’s senior management that set out the 
likelihood and potential impact of the significant 
risks faced by the company reviewing the 
group’s controls reviewing and agreeing the 
need for an internal audit function confirming 
the adequacy of the company’s whistleblowing 
policy and undertaking a specific review of 
the company’s sales contracts procedures 
and reviewing the collection of revenue
in accordance with the code the company 
maintains a policy on the engagement of the 
external auditors with respect to the performance 
of nonaudit related work the policy also 
provides that any nonaudit work involving a 
single expenditure of more than 02m must 
be assigned to tender the amount paid for 
nonaudit work during the year is set out in 
note 5 to the financial statements on page 75 
remuneration committee
a description of the role composition and 
responsibilities of the remuneration committee 
can be found on page 43 in the directors’ 
remuneration report
nomination committee
the nomination committee has responsibility 
to assist the board with succession planning and 
with the selection process for the appointment 
of a new director or chairman the nomination 
committee is chaired by the chairman of the 
board and comprises all nonexecutive directors 
the chairman of the board serves as secretary 
to the committee 
save for patrick paul who resigned as a  
nonexecutive director on 23 february 2011 
all members of the committee are independent 
within the meaning of the code the code states 
that the test of independence is inappropriate 
to the chairman of the board peter fellner 
fulfilled the independence criteria at the time 
of his appointment
the principal responsibilities of the nomination 
committee are as follows evaluate the balance 
of skills knowledge and experience on the board 
and following this evaluation prepare a description 
of the role and requisite capabilities required 
for a particular appointment assess the time 
commitment expected on the part of the chairman 
of the company and to require nonexecutive 
directors to undertake that they will have sufficient 
time to meet their commitments to the company 
oversee the search process for suitably qualified 
nonexecutive directors as and when required 
using outside advisers as the nomination committee 
may determine as appropriate and arrange for 
all members of the nomination committee 
to meet the preferred candidate prior to making 
a formal recommendation to the board
the main activities of the nomination committee 
during the financial year ended 30 september 2011 
included the appointment of an external search firm 
culminating in the appointment of john goddard 
and david wilson to the board as nonexecutive 
directors and considering the contribution 
and commitment of the directors standing 
for reelection
the number of meetings held during the financial 
year ended 30 september 2011 and the attendance 
record at these meetings is set out on page 34
communication with shareholders
the company believes in having an open and 
regular dialogue with shareholders to ensure that 
the goals objectives and overall business strategy 
of the company are communicated and understood 
the board supports the use of the company’s 
annual general meeting “agm” as a means for 
communicating with shareholders and encourages 
their participation 
the ceo and cfo make twice yearly presentations 
following the company’s interim and preliminary 
results announcements hosting site visits and 
investor information days provides the investment 
community and shareholders with the opportunity 
to improve their understanding of the company 
and its strategy 
3optsar11middlejennyshindd   8 17012012   110725 optos plc annual report and accounts 2011 36
governance
corporate governance continued
communication with shareholders continued
during the year the company issued interim 
management statements and preclose trading 
statements relating to performance for a 
specified period of time and disclosed relevant 
business news through the regulatory news 
service in accordance with the dtrs the 
company notifies the market of its total voting 
rights and issued share capital at the beginning 
of every month covering the previous month 
health and safety 
there were no health and safety enforcement 
actions at any of the company’s locations during 
the year ended 30 september 2011 
the company’s policy regards the health safety 
and welfare of all employees as a matter of prime 
importance and serves as the basis for the company 
owing a duty of care under law and as a matter 
of best practice to protect its employees and 
others from harm arising from work activities 
the company has a written policy on health 
and safety which comprises the following elements 
statement of the company’s commitment to 
health and safety and detailing how safety will 
be managed details of where responsibilities are 
allocated and how employees fit into the overall 
safety management system and details of how 
specific activities and functions are managed 
the last element includes risk assessments fire 
safety first aid incident and accident reporting 
electrical safety work equipment hazardous 
substances and manual handling information 
instruction and training on health and safety 
are provided across the company
the company’s global webbased system procured 
for quality management system applications 
has over the last year been expanded to also 
accommodate the company’s health and safety 
policies and procedures this system allows 
instant access to the company’s internal policies 
and procedures by any employee of the company 
it is the company’s intention to continue to expand 
the use of this global webbased system in other 
areas of health and safety applications
the company is compliant with medical device 
directive 200747ec with respect to iso 13485 
and ce marking of its products this is with 
particular reference to the requirement relating 
to risks associated with substances leaking from 
medical devices the company has declared that 
none of its devices contain di2ethylhexyl
phthalate “dehp” at levels equal to or greater 
than 01 by mass and that no raw materials 
containing or derived from bisphenol a “bpa” 
are in contact with the patient
the board has acknowledged and accepted its 
responsibility for health and safety across the 
group the ceo has overall responsibility for 
ensuring that line management is responsible for 
the daytoday management of health and safety 
the board receives monthly updates and on a 
quarterly basis a detailed report on health and 
safety which enables the directors to closely 
assess safety and review the effectiveness of the 
health and policy throughout the financial year
environment
there was no environmental enforcement action 
at any of the company’s locations during the 
financial year ended 30 september 2011
the company makes available to its customers 
medical retinal imaging devices that are designed 
to ensure at a very minimum that they comply 
with applicable laws regulations and industry 
standards in each of the country markets in 
which it operates these devices by design have 
a minimal impact on the environment 
the company engages in the continuous 
development of a range of packing materials that 
are suitable for multitrip use the company is 
further rationalising and minimising the number 
of material movements both internally and 
externally by developing the us distribution 
service centre as a manufacturing hub in addition 
to its repair capabilities this is part of a six sigma 
lean strategy which is expected to deliver several 
benefits including a positive environmental 
impact this strategy will necessarily involve 
the supply chain 
all directors can be reached 
by contacting the company 
secretary at
optos plc 
queensferry house 
carnegie business campus 
enterprise way 
dunfermline scotland 
ky11 8gr
company information is available from  
wwwoptoscom
3optsar11middlejennyshindd   9 17012012   110725 optos plc annual report and accounts 2011 37
overview
business review
governance
financial statements
environment continued
additionally the company’s newest desktop 
retinal imaging device uses less packaging 
less power and has simpler installation 
requirements which together results in a 
greener environmental outcome
the company undertakes to recycle its paper 
plastics metal and personal computers and 
mobile telephones medical devices are no longer 
excluded from the rosh directive as from 2014 
the redesign of certain electronics to be “lead 
free” is well underway with suppliers validating 
these new processes 
under an approved producer compliance scheme 
the company is meeting the waste electrical 
electronic equipment “weee” regulations
equal opportunities
the company is an equal opportunities employer 
this means that it is company policy that no 
individual or group of individuals experiences 
discrimination harassment or victimisation on 
any grounds the company upholds a policy of 
providing equal opportunities to all persons this 
underpins and guides all aspects of employment 
including recruitment and promotion and provides 
encouragement to employees at all levels to act 
fairly and to prevent discrimination on any ground 
including but not limited to age sex race marital 
status sexual orientation religion or disability 
company policies for recruitment training 
career development and promotion of employees 
are open fair and inclusive in their approach 
the company recognises the need to develop 
and regularly review employment policies and 
procedures to ensure that recruitment training 
and development promotion and compensation 
decisions are made on the basis of competency 
performance ability and potential the company 
seeks to facilitate a culture that enables employees 
to successfully balance professional and personal 
requirements and commitments we believe 
that this helps recruit and retain skilled and 
motivated employees
corporate giving
the company believes that building and 
maintaining vibrant healthy communities 
is a shared responsibility and is committed 
to doing its part employees are encouraged 
to engage with and make a difference in the 
communities where they live and work and the 
company supported employees and partnered 
with customers and organisations in a number 
of worthy causes and initiatives to give back 
and make that important difference many 
employees contributed independently of the 
company to support their colleagues in their 
charitable endeavours 
the company continues to maintain an informal 
giving programme that provides modest financial 
support to encourage the community spirit of its 
employees it is about looking for opportunities 
to empower and collaborate with employees 
and the community through charitable work 
notforprofits professional organisations schools 
and others it is also about being proactive to 
promote and address issues that matter to 
stakeholders the company does not make 
donations to political parties or bodies
going concern
the directors having reviewed the group’s 
budget for the next financial year and other 
longerterm plans are satisfied that the group 
has adequate resources to continue in operational 
existence for the foreseeable future and therefore 
it is appropriate to continue to adopt the going 
concern basis in preparing the accounts
by order of the board
john mcneil
company secretary
21 november 2011
3optsar11middlejennyshindd   10 17012012   110725 optos plc annual report and accounts 2011 38
governance
directors’ report
principal activities
optos plc is a leading retinal imaging company 
the company’s medical devices produce  
ultrawidefield high resolution digital images 
of approximately 82 of the retina in a single 
capture the images provide enhanced clinical 
information for ophthalmic professionals 
facilitating the early detection management 
and treatment of both eye and noneye disorders 
and diseases that may first exhibit in the retina 
the company is expanding its product range 
through the development or acquisition of 
additional devices and software to further 
assist ophthalmic professionals in their 
provision of care to patients
business review
the directors’ report should be read in 
conjunction with the chairman’s statement 
on pages 06 and 07 and the business review 
on pages 10 to 27 which are incorporated into 
this report by reference these contain details of 
the principal activities of the company a review 
of the business during the year and an indication 
of expected progress disclosure of the key 
performance indicators “kpis” for the company 
disclosure of the principal risks and uncertainties 
affecting the business and disclosure of the 
company’s financial risk management policy 
in addition to this note 27 of the financial 
statements also contains disclosure relating to 
the company’s principal financial instruments
financial results
the profit after taxation for the year ended 
30 september 2011 was 228m compared to 14m 
for the financial year ended 30 september 2010 
basic earnings per share was 321c compared 
to 200c per share for the financial year ended 
30 september 2010 
dividend
no dividend is payable
share capital and structure
the company has an authorised share capital 
£1800000 comprising 90000000 ordinary 
shares as at this date each ordinary share 
has a nominal value of £002 and each carries 
one vote 
no share in the capital of the company may 
be allotted at a discount and save as permitted 
by the companies act 2006 2006 act no share 
may be allotted except as paid up at least as to 
onequarter of its nominal value and the whole 
of any premium on it
as at 1 october 2010 the company had 
70557475 ordinary shares in issue an additional 
706451 ordinary shares were issued during the 
year ended 30 september 2011 to employees 
and former employees also included were 
shares issued in connection with the acquisition 
of opto global holdings pty limited the company 
therefore had 71263926 ordinary shares in 
issue as at 30 september 2011 representing 
71263926 in total voting rights
voting
subject to the company’s articles of association 
“aoa” and the rights and restrictions thereof 
and of the 2006 act every shareholder present 
in person at a general meeting of the company 
shall on a show of hands have one vote and on 
a poll every shareholder present in person at a 
general meeting or by proxy shall have one vote 
for every share of which they are the holder 
no shareholder shall be entitled to vote in 
relation to shares held by them unless all 
monies presently payable by them in respect 
of those shares have been fully paid 
transfer of shares
there is no restriction on the transfer of shares 
in the company other than as contained in the 
company’s articles of association the board 
may in its absolute discretion and without giving 
any reason refuse to register the transfer of a 
this directors’ report contains certain 
statutory regulatory and other information 
and incorporates by reference the chairman’s 
statement and operational financial and risk 
reviews included earlier in this document
the directors present their 
report and the audited financial 
statements for the year ended 
30 september 2011
our corporate governance report 
pages 32–37
3optsar11middlejennyshindd   11 17012012   110725 optos plc annual report and accounts 2011 39
overview
business review
governance
financial statements
transfer of shares continued
certificated share which is i not a fully paid 
share provided that the refusal does not prevent 
dealings in shares of that class in the company 
from taking place on an open and proper basis 
ii in respect of more than one class of shares 
or iii not lodged duly stamped if stampable 
with the company and except where the shares 
are registered in the name of a recognised person 
as defined in the articles and no certificate shall 
have been issued thereof accompanied by the 
relevant share certificate and such other evidence 
of the right to transfer as the board may require 
in the case of a transfer of a certificated share 
by a recognised person the lodging of a share 
certificate will only be necessary if and to the 
extent that a certificate has been issued in respect 
of the share in question the board may in its 
absolute discretion and without giving any reason 
refuse to register any allotment or transfer of 
shares which is in favour of a child bankrupt 
person or person of unsound mind or more than 
four joint allottees or transferees
notified interest of shareholding
as at 30 september 2011 the company had 
been notified in accordance with the financial 
services authority disclosure and transparency 
rules of interests in the company’s ordinary 
share capital see table right for details
the company is not aware of any other significant 
direct or indirect holding of securities in the 
company except for directors’ holdings which 
are disclosed on page 48 of the directors’ 
remuneration report
voting rights
deadlines for exercising voting rights and 
appointing a proxy or proxies to vote on 
resolutions to be passed at the agm on 
21 february 2011 will be specified in the notice 
of agm the voting rights of shareholders are 
restricted where a notice pursuant to section 793 
of the 2006 act has been given in respect of shares 
held by such shareholder and the information 
required by such notice has not been given to 
the company 
there are currently no limitations on the voting 
rights of shareholders of a given percentage or 
number of votes and the company is not aware 
of any arrangement by which with the company’s 
cooperation financial rights carried by ordinary 
shares and held by a person other than the holder 
of such ordinary shares the company is not aware 
of any agreement between holders of securities 
which may result in restrictions on the transfer 
of securities or on voting rights
directors
details of the directors are set out on 
pages 28 to 29 details of appointments to 
and resignations from the board during the 
financial year can be found on page 48 in 
the directors’ remuneration report
directors’ interests
details of the directors’ interests are set out on 
page 48
directors’ powers 
subject to the provisions of the 2006 act the 
company’s articles and to any powers given by 
special resolution of the company the business 
of the company shall be managed by the board 
which may exercise all the powers of the company 
whether relating to the management of the business 
or not the company’s articles detail the specific 
authorities of the directors copies of the articles 
may be obtained from the company secretary
allotment and issue of shares
the directors are by shareholder resolution 
passed at the agm of the company on 
23 february 2011 generally and unconditionally 
authorised to exercise all the powers of the 
company to allot relevant securities up to a 
maximum nominal amount of £47299022 being 
equal to approximately 333 of the company’s 
issued share capital as at 18 january 2011
notified interest of shareholding
as at 30 september 2011 the company had 
been notified in accordance with the financial 
services authority disclosure and transparency 
rules of the following interests in the 
company’s ordinary share capital 
   number of   
   ordinary  issued 
shareholder  shares share capital
amadeus capital partners limited
1
  10254753 1439
aberforth partners llp  8582035 1204
threadneedle asset management ltd  4155336 583
aviva investors global services ltd uk  3616478 508
atp investment management  3539439 497
royal london asset management  2499955 351
1  the company disclosed on 8 november 2011 that it had received notification 
from amadeus capital partners limited that it had reduced its shareholding in 
the company by 3000000 shares to 7254753 representing 1018 of the 
company’s issued share capital
details of the directors’ interests
page 48
3optsar11middlejennyshindd   12 17012012   110726 optos plc annual report and accounts 2011 40
allotment and issue of shares continued
the directors are also generally empowered 
to allot equity securities within the meaning 
of the 2006 act of the company for cash on a 
non preemptive basis this power is limited to 
i any allotment where equity securities have 
been offered to holders of equity securities in 
proportion as nearly as may be to their then 
holdings of such securities and ii any other 
allotment of equity securities up to an aggregate 
nominal value of £7101955 being equal to 
approximately 5 of the company’s issued 
share capital as at 18 january 2011 
such authorities and powers expire at the 
company’s agm being held on 21 february 2012 
unless previously revoked varied or renewed 
it is proposed that these authorities and powers 
be renewed by shareholder resolution at the 
company’s forthcoming agm pursuant to and 
within the meaning of the 2006 act but without 
prejudice to the exercise of any such authority 
prior to the date of the resolution 
redeemable shares and purchase of own shares
subject to the companies act 2006 and without 
prejudice to any rights attaching to any existing 
shares or class of shares in such manner as is 
provided in the articles shares may be issued 
that are to be redeemed or which at the option 
of the company or the holder are liable to be 
redeemed subject to the relevant legislation and 
without prejudice to any relevant special rights 
attached to any class of shares the company 
may purchase any of its own shares of any class 
in any way and at any price whether at par 
or above or below par
the company is by shareholder resolution passed 
at the company’s agm on 23 february 2011 
generally and unconditionally authorised to 
make market purchases of any of its ordinary 
shares on such terms and in such manner as the 
directors of the company may from time to 
time determine provided that i the maximum 
number of ordinary shares authorised to be 
purchased is up to but not exceeding 10 of the 
company’s issued share capital ii the minimum 
price which may be paid for any such ordinary 
share is £002 exclusive of the expenses of 
purchase if any payable by the company 
iii the maximum price exclusive of the expenses 
of purchase if any payable by the company 
which may be paid for any such ordinary share 
is an amount equal to 105 of the average of 
the mid market closing quotations for an ordinary 
share as derived from the daily official list of 
the london stock exchange for the five business 
days immediately preceding the day of purchase 
it is proposed that this authority and power 
be renewed by shareholder resolution at the 
company’s forthcoming agm being held on 
21 february 2012 pursuant to and within the 
meaning of the 2006 act but without prejudice 
to the exercise of any such authority prior to 
the date of the resolution
appointment of directors
directors may be appointed by the company 
by an ordinary resolution of shareholders 
the board may appoint a director either to fill a 
vacancy or as an additional director and in either 
case whether or not for a fixed term any director 
so appointed will hold office only until the next 
following general meeting and will not be taken 
into account in determining the directors who 
are to retire by rotation at such meeting and 
shall then be eligible for reappointment if not 
reappointed at such meeting such a director 
will vacate office at its conclusion if any such 
person is not appointed at such meeting he or 
she shall retain office until the meeting appoints 
someone in his or her place or if he or she does 
not do so until the end of the meeting a director 
is not required to hold shares in the capital 
of the company directors are provided with 
documentation on the company and its activities 
an appropriate induction is provided for new 
directors and ongoing training is provided as 
and when may be required
retirement of directors
each director who has been appointed following 
the last agm and any director who was not 
appointed or reappointed at one of the preceding 
two agms must retire from office and are eligible 
for reappointment
disabled employees 
equal opportunity guides all aspects of 
employment including recruitment and 
promotion and provides encouragement 
to employees at all levels to act fairly and 
to prevent discrimination on any ground 
including disability additional information 
on the company’s employment policy can 
be found on page 37 
employee involvement
the company operates a framework for employee 
information and consultation and during the year 
provided employees with information including 
information relating to the economic and financial 
factors affecting the company including through 
presentations from the ceo a companywide 
newsletter in which employees are encouraged to 
present suggestions and views and through regular 
interdepartmental and management meetings 
all of which are designed to allow for and encourage 
a free and crossfunctional flow of information 
and ideas employees participate directly in the 
success of the company through an individual 
and performance related bonus scheme and 
through a share award and option scheme 
governance
directors’ report continued
3optsar11middlejennyshindd   13 17012012   110726 optos plc annual report and accounts 2011 41
overview
business review
governance
financial statements
significant agreements 
there are no agreements which the company 
considers significant and to which the company 
is a party that take effect alter or terminate 
upon a change of control of the company 
following a takeover bid
indemnification
the articles of the company allow the directors 
to be indemnified against all liabilities incurred 
in the proper conduct of the company’s business 
research and development
the company continues to invest in research 
and development details of which are set out 
in the business review on page 09
material contracts
none of the directors had any material interest 
in any material contract with the company or 
its subsidiary companies
creditor payment policy
the company’s policy for all suppliers is to fix 
the term of payment when agreeing the terms 
of the credit account to ensure that the supplier 
is aware of the terms and to abide by the terms 
of payment trade payables are typically paid 
twice monthly with terms equivalent to an 
average of 35 days
charitable contributions
the company made a small number of charitable 
donations during the year principally to local 
projects and initiatives in small amounts 
political donations
the company made no political donations
financial instruments
the company’s financial risk management 
objectives and policies are discussed in note 27 
to the financial statements on page 98 to 102
annual general meeting
the agm will be held on 21 february 2012 for 
which a notice will be sent to shareholders together 
with a form of proxy separately containing the 
resolutions being proposed and an accompanying 
explanatory description of each resolution
auditors
a resolution to reappoint ernst  young llp 
as auditors will be submitted to shareholders 
at the agm on 21 february 2012
directors’ statement as to disclosure 
of information to auditors
the directors who were members of the board 
at the time of approving the directors’ report are 
listed on page 34 and having made enquiries of 
fellow directors and of the company’s auditors 
each of these directors confirms that to the best of 
their knowledge and belief there is no information 
that is information needed by the company’s 
auditors in connection with preparing their report 
of which the company’s auditors are unaware and 
each director has taken all the steps a director 
might reasonably be expected to have taken to 
be aware of relevant audit information and to 
establish that the company’s auditors are aware 
of that information
postbalance sheet events
on 22 september 2011 the company announced 
that it had entered into a conditional agreement 
with opko health inc opko instrumentation llc 
ophthalmic technologies inc and oti uk limited 
to acquire the assets and business of the 
instrumentation division of opko health inc 
subject to the terms and conditions contained in 
the acquisition agreement as defined in the circular 
of the company dated 22 september 2011 and 
shareholder approval at a general meeting being 
held on 10 october 2011 on 10 october 2011 
the company announced that the resolution set 
out in the company’s notice of general meeting 
issued on 22 september 2011 detailing the 
proposed acquisition was passed by shareholders 
and that subject to all remaining conditions being 
satisfied that the completion of the acquisition 
was expected to take place on or around 
11 october 2011 on 11 october 2011 the 
company announced that all outstanding 
conditions had been satisfied and that the 
acquisition had been completed and that the 
initial cash consideration of us175m 
had been paid
by order of the board
john mcneil optos plc
company secretary registered number
21 november 2011 sc139953
3optsar11middlejennyshindd   14 17012012   110726 optos plc annual report and accounts 2011 42
the directors are responsible for keeping 
adequate accounting records that are sufficient 
to show and explain the group’s transactions 
and disclose with reasonable accuracy at any 
time the financial position of the group 
enabling them to ensure that the financial 
statements comply with the 2006 act and 
article 4 of the ias regulation 
the information presented in this annual 
report and accounts “ara” has been prepared 
in accordance with the 2006 act the united 
kingdom listing authority “ukla” listing rules 
the disclosure and transparency rules “dtrs” 
and the financial reporting council “frc” the 
uk corporate governance code the “code” 
june 2010 
the directors are responsible for preparing 
the ara and the group and company together 
“the group” financial statements in accordance 
with applicable uk law and those international 
financial reporting standards “ifrs” as adopted 
by the european union under company law the 
directors must not approve the group financial 
statements unless they are satisfied that they 
present fairly the financial position of the group 
and the financial performance and cash flows 
of the group for that period 
in preparing those financial statements the 
directors are required to select suitable accounting 
policies in accordance with ias 8 “accounting 
policies change in accounting estimates and 
errors” and then apply them consistently present 
information including accounting policies in a 
manner that provides relevant reliable comparable 
and understandable information provide additional 
disclosures when compliance with the specific 
requirements in ifrs is insufficient to enable 
users to understand the impact of particular 
transactions other events and conditions on the 
group’s financial position and financial performance 
state that the group has complied with ifrss 
subject to any material departures disclosed and 
explained in the financial statements and make 
judgements and accounting estimates that are 
reasonable and prudent
the directors are responsible for keeping adequate 
accounting records that are sufficient to show 
and explain the group’s transactions and disclose 
with reasonable accuracy at any time the financial 
position of the group enabling them to ensure 
that the financial statements comply with the 
2006 act and article 4 of the ias regulation 
they are also responsible for safeguarding the 
assets of the company and hence for taking 
reasonable steps for the prevention and 
detection of fraud and other irregularities
responsibility statement
the directors together confirm that to the 
best of their knowledge the financial statements 
prepared in accordance with ifrss as adopted 
by the european union give a true and fair 
view of the assets liabilities financial position 
and profit of the company and the undertakings 
included in the consolidation taken as a whole 
and that the directors’ report includes a fair 
review of the development and performance 
of the business and the position of the company 
and the undertakings included in the consolidation 
taken as a whole together with a description 
of the principal risks and uncertainties that 
they face
by order of the board
john mcneil
company secretary
21 november 2011
governance
directors’ responsibilities
3optsar11middlejennyshindd   15 17012012   110726 optos plc annual report and accounts 2011 43
overview
business review
governance
financial statements
directors’ remuneration report
this directors’ remuneration report the “report” 
has been prepared in accordance with schedule 8 
of the accounting regulations under the companies 
act 2006 “2006 act” the large and mediumsized 
companies and groups accounts and reports 
regulations 2008 schedule 8 paragraph 4 
the uk corporate governance code june 2010 
the “code” and the relevant requirements of the 
listing rules of the financial services authority 
as required by the 2006 act a resolution 
to approve the report will be proposed at the 
annual general meeting “agm” of the company 
being held on 21 february 2012 the vote on 
this resolution is however advisory and no 
aspect of an individual director’s remuneration 
is conditional on the vote being passed 
the 2006 act further requires the auditors to 
report to the company’s members on certain 
parts of the report and to state whether in 
their opinion those parts of the report have 
been properly prepared in accordance with 
the 2006 act certain items in the report are 
required to be audited and are identified as 
such against the relevant heading
the role composition and responsibilities of 
the remuneration committee the “committee”
the committee has responsibility for the group’s 
overall remuneration philosophy policies and 
procedures which are determined with due 
regard to the interests of shareholders and the 
company the company has specific responsibility 
for the policy of the remuneration of the executive 
directors company secretary and the operating 
board “ob” which consists of the company’s 
senior management the remuneration committee 
extends consideration to several components 
in respect of the remuneration of the executive 
directors company secretary and the ob which 
together comprise the total remuneration package 
the remuneration committee is chaired by 
rosalyn s wilton and its other members during 
the financial year ended 30 september 2011 
included dr peter j fellner dr peter h kehoe 
from 22 march 2011 barry m rose and 
david i wilson from 7 september 2011 
the company secretary serves as secretary 
to the committee all members of the committee 
are considered independent within the meaning 
of the code the code states that the test of 
independence is inappropriate to the chairman 
of the board of directors peter j fellner was 
independent within the meaning of the code 
on his appointment the board considers 
that the chairman of the board should be a 
member of the remuneration committee as it 
is essential that the chairman be involved in 
the decisionmaking process relative to the 
remuneration of the executive directors
the principal responsibilities of the 
remuneration committee are as follows 
determine the remuneration policy for the 
group determine the policy and specific 
remuneration for the executive directors 
including where applicable their service 
contracts determine whether the executive 
directors company secretary and members 
of the operating board “ob” which comprises 
the company’s senior management should 
be eligible to receive annual bonuses and any 
benefits under the deferred bonus plan “dbp” 
performance share plan “psp” or share option 
plan “sop” determine the performance 
conditions to be attached to annual bonus 
payments and any benefits awarded under 
the dbp psp or sop determine pensionable 
remuneration and determine and recommend 
to the board the remuneration of the chairman
fees paid to nonexecutive directors are 
determined and approved by the board 
the remuneration of nonexecutive directors 
is determined by the board as a whole 
the members of the remuneration committee 
have no personal financial interest other than 
as shareholders in the matters to be decided 
no actual or potential conflicts of interest arising 
from other directorships and no daytoday 
operational responsibility within the company
compensation philosophy
the group’s compensation philosophy the 
“philosophy” serves as a highlevel tool to help 
the board and management align compensation 
related decisions back to strategy the philosophy 
aims to pay a marketcompetitive level of 
compensation be sufficient to recruit motivate 
and retain executives of the calibre required be 
structured such that an appropriate portion of the 
package links rewards to corporate and individual 
performance to drive a resultsoriented culture 
share financial success with all employees through 
incentive compensation programmes ensure 
compensation achieves an appropriate balance 
between risk and reward and be aligned to the 
enhancement of sustained shareholder value 
in setting the remuneration of the executive 
directors and senior management the committee 
takes into account the economic environment 
and financial performance of the group together 
with the pay and employment conditions 
of employees elsewhere in the group
executive directors’ remuneration
during the financial year ended 30 september 2011 
the remuneration committee consulted with 
deloitte llp on structuring and benchmarking 
the executive directors’ remuneration 
remuneration for the executive directors 
seeks to balance fixed remuneration and 
performance related awards with the target 
of achieving stretch performance with the 
adoption of a dbp on 23 february 2011 the 
remuneration split consists of four elements 
fixed base salary and benefits shortterm 
variable annual bonus deferred bonus and 
performance based matching awards and 
longterm variable sharebased awards 
fixed comprises base salary and benefits in 
kind shortterm variable is comprised of a 
nondeferred bonus amount there is a mandatory 
minimum deferred amount longterm variable 
comprises of a matching award under the dbp 
and awards made under the psp 
3optsar11middlejennyshindd   16 17012012   110726 optos plc annual report and accounts 2011 44
base salary and benefits
base salaries are based upon a combination of 
individual contribution and overall performance 
and in the light of competitive positioning as 
mentioned earlier base salaries are reviewed 
annually when reviewing the salaries of the 
executive directors the committee also has 
regard to the impact of the cost of pension 
provision and pay and conditions elsewhere 
in the group in particular the committee takes 
account of the level of salary increases awarded 
to other employees in the group when deciding 
on increases for the executive directors benefits 
in kind include private health insurance life 
insurance and a contribution of 10 of gross 
basic annual salary to a defined contribution 
pension scheme
the committee has approved an increase in 
annual base salary of 5 to £320250 for roy davis 
for the financial year beginning 1 october 2011 
the committee resolved that the annual base 
salary of the cfo would increase by 25 to 
£205000 for the financial year beginning 
1 october 2011 the committee determined that 
the increases for both the ceo and cfo reflect 
the scope and responsibilities associated with the 
roles the increases are within the range of base 
salary increases for employees in the wider group
the committee determined that the annual base 
salaries for the ceo and cfo are positioned 
within the market competitive range compared 
to companies of a similar size and complexity
annual bonus
the company operates an annual bonus plan 
that is intended to place the total cash earnings 
of executives at the median for the market upon 
the achievement of stretching performance 
objectives the factors to be measured for bonus 
purposes and the corresponding levels of bonus 
are predetermined at the beginning of each 
financial year in the light of the company’s strategy 
achievement of stretch targets provided for a 
bonus opportunity equivalent to a maximum 100 
of basic annual salary the annual bonus provides 
a direct link between annual business performance 
and reward the committee considered and 
assessed the financial performance of the 
company for the year ended 30 september 2011 
and resolved to award a bonus to both the ceo 
and cfo equivalent to 7775 of their respective 
base salaries the bonus award for the year was 
based on the group achieving certain financial 
targets relating to revenue operating profit and 
operating cash flow adjusted to reflect exceptional 
items and to regularise the impact of accounting 
treatments for customer rental agreements
with the implementation of the dbp there is 
a 25 mandatory deferral of the bonus amount 
payable to the executive directors
for the financial year ending 30 september 2012 
the executive directors will have a maximum 
bonus opportunity equivalent to 100 of basic 
annual salary dependent upon the achievement 
of stretching financial performance targets 
the committee has resolved to employ metrics 
similar to those used in fy11 and has established 
a minimum base and stretch targets relative to 
revenue operating profit and operating cash flow
deferred bonus plan “dbp” and performance 
based matching awards
the dbp was approved by shareholders at 
the company’s annual general meeting held 
on 23 february 2011 this plan is designed 
to encourage share ownership and to further 
support the delivery of the group’s business 
strategy and commitment to generating longterm 
value for shareholders for executive directors 
the dbp provides for the deferral of up to a 
maximum 50 of annual bonus for three years 
governance
directors’ remuneration report continued
    target range 
measure   of bonus minimummaximum  of bonus achieved
revenue  30 117m–133m  3000
adjusted operating profit  50 19m–244m  4775
adjusted operating cash flow  20 42m–50m  nil
   100   7775
3optsar11middlejennyshindd   17 17012012   110726 optos plc annual report and accounts 2011 45
overview
business review
governance
financial statements
deferred bonus plan “dbp” and performance 
based matching awards continued
to be held in the form of shares in the company 
and with an opportunity to earn a matching 
awards of shares up to a maximum ratio of 
11 subject to the achievement of a further 
performance condition
there will be a mandatory 25 deferral of 
the annual bonus being paid to the executive 
directors for the year ended 30 september 2011 
this deferral will be into shares in the company 
which must be held for three years a further 25 
of the annual bonus may be voluntarily deferred 
in order to encourage share ownership for the 
operating board which comprises the company’s 
most senior management team these executives 
may be invited to defer up to 30 of their annual 
bonus into shares for a threeyear period
any bonus deferred on a mandatory basis will 
be subject to a clawback provision such that 
at the discretion of the committee the deferred 
shares may be forfeited should it subsequently 
be confirmed that the original results on which 
the bonus was calculated contained a material 
misstatement of the group’s financial results
in order to more closely align remuneration 
with the longerterm success of the company 
and growth in shareholder value participants 
will be granted an opportunity to earn a matching 
award of shares matching shares will vest at 
the end of the threeyear deferral period for 
the initial grant under the dbp matching awards 
will vest subject to a performance target based 
on relative total shareholder return “tsr” 
compared to the ftse small cap index exclusive 
of investment trusts the committee had 
determined that relative tsr is an appropriate 
performance condition in order to measure 
performance by reference to the external market 
therefore strengthening the alignment of executive 
interests with those of shareholders
awards will vest on a pro rata basis between 
30 and 100 for performance between median 
and upper quartile and will be subject to the 
participant continuing to be employed by the 
group at the end of the threeyear deferral period
other sharebased awards 
the company operates two longterm incentive 
plans offering sharebased awards the psp and the 
sop both plans are supervised by the committee 
executive directors are eligible to participate 
in both the psp and sop no awards were made 
to the executive directors under the sop for 
the financial year ended 30 september 2011 
both executive directors received awards under 
the psp for the same period as detailed below
a minor change to the operation of the psp 
is proposed for 201011 to enable participants 
to benefit from uk tax efficiencies under the 
hm revenue  customs approved share schemes 
legislation awards made in 201011 will therefore 
be structured as approved performance share plan 
“apsp” awards and comprise an hm revenue  
customs approved option in respect of the first 
£30000 worth of an award and a psp award for 
amounts that exceed this limit the number of 
shares that may be delivered under the psp award 
will be adjusted at vestingexercise to ensure that 
the total pretax value delivered to participants 
remains unchanged the company does not intend 
to make awards under both the psp and sop in 
the same grant period
relative tsr against ftse small cap index  matching share 
exclusive of investment trusts  award ratio
below median  —
median  031
upper quartile  11
performance share plan “psp” 
any group employee including the executive 
directors is eligible to participate in the psp 
upon invitation and at the discretion of the 
committee an employee may not normally 
receive awards in a financial year over shares 
having a market value in excess of 100 of his 
or her annual base salary in that financial year 
awards will normally vest on the third anniversary 
of the date of grant to the extent that any 
performance conditions that may be attached 
to the award have been satisfied and provided 
that the participant is employed by the company 
at the date of vesting awards granted under the 
psp are always subject to performance conditions 
the committee may grant awards under the 
psp as conditional shares a nil or nominal 
cost option with a short exercise period or as 
forfeitable shares the committee may also 
decide to grant cashbased awards of an 
equivalent value to sharebased awards or 
to satisfy sharebased awards in cash
details of awards and associated performance 
conditions are detailed below
financial year ended 30 september 2009
roy davis received an award of 490000 on 
10 march 2009 the market price on the date 
of grant was £04125 the award shall vest and 
be exercisable on 9 march 2012 to the extent 
that the following eps targets are met
the number of shares which vest upon achieving 
a result between the minimum and maximum 
targets for each measure will be determined 
on a straightline basis the committee having 
confirmed that the performance conditions have 
been satisfied determined that 100 of the 
abovenoted award shall vest on 9 march 2012
   award vesting
performance measure 0  0–100 100
fully diluted eps 00745 00745–0133 0133
3optsar11middlejennyshindd   18 17012012   110727 optos plc annual report and accounts 2011 46
governance
directors’ remuneration report continued
performance share plan continued
financial year ended 30 september 2010
roy davis and christine soden respectively 
received an award of 250000 and 150000 
on 15 december 2009 the market price on 
this date of grant was £09275 christine soden 
received an award of 40000 on 20 may 2010 
the market price on this date of grant was £130
50 of the awards are subject to meeting 
a cumulative eps target and 50 is subject 
to meeting a cumulative cash flow target 
for the threeyear financial period ending 
30 september 2012 to ensure that the 
performance criteria used to measure the 
awards is assessed on a fair and consistent 
basis between accounting periods the committee 
has determined that adjusted eps will be defined 
as attributable profit before tax adjusted to 
account for customer leases as operating rather 
than finance leases and exclude amortisation
impairment of acquired intangibles or goodwill 
any notional interest on deferred consideration 
and any other acquisitionrelated costs or credits 
adjusted cash flow will be defined as net cash flow 
from operations less amounts invested in building 
new medical devices plus receipts from finance 
lease receivables and excluding any notional 
interest on deferred consideration and any other 
acquisitionrelated costs or credits
the awards shall vest and be exercisable 
respectively on 14 december 2012 and 
19 may 2013 to the extent that the following 
performance conditions are met
   award vesting
performance measure 0 0–100 100
adjusted eps 040 048 057
cumulative adjusted cash flow 
from operations 626m 782m 938m
the number of shares which vest upon achieving 
a result between the minimum and maximum 
targets for each measure will be determined 
on a straightline basis
financial year ended 30 september 2011
roy davis received an award of 290476 and 
christine soden received an award of 190476 
on 24 november 2010 the market price on the 
date of grant was £12350
100 of the awards is subject to meeting 
cumulative operating cash flow figures 
for the threeyear financial period ending 
30 september 2013 to ensure that the 
performance criteria used to measure the 
awards is assessed on a fair and consistent 
basis between accounting periods the committee 
has determined that adjusted cash flow will be 
defined as net cash flow from operations less 
amounts invested in building new medical devices 
plus receipts from finance lease receivables and 
excluding any notional interest on deferred 
consideration and any other acquisitionrelated 
costs or credits
the awards shall vest and be exercisable 
on 23 november 2013 to the extent that the 
cumulative operating cash flow for the three 
financial years ending 30 september 2013 
reaches a specified figure as set out above
the number of shares that shall vest upon 
achieving cumulative adjusted operating 
cash flow between 740m–1110m will 
be determined on a straightline basis  
   award vesting
performance measure 0 25 50 100
cumulative adjusted  
cash flow from operations 740m 740m 926m 1110m
in addition the ultimate vesting of awards 
is subject to the company delivering a level 
of eps in each of the financial years that 
the committee determines to be satisfactory 
taking into account expectations for the 
performance of the company known at the 
time when the award was granted
financial year ending 30 september 2012
roy davis received an award of 156220 
and christine soden received an award of 
60000 on 22 november 2011
50 of the awards is subject to meeting 
cumulative eps and cash flow targets for the 
three financial years ending 30 september 2014 
eps is defined as attributable profit before tax 
adjusted to account for customer leases as 
operating rather than finance leases and to 
exclude amortisationimpairment of acquired 
intangibles or goodwill any notional interest 
on deferred consideration and any other 
acquisitionrelated costs or credits adjusted 
cash flow from operations will be defined as 
net cash flow from operations plus receipts 
from finance lease receivables and excluding 
any notional interest on deferred consideration 
and any other acquisitionrelated costs or credits
3optsar11middlejennyshindd   19 17012012   110727 optos plc annual report and accounts 2011 47
overview
business review
governance
financial statements
other share incentive schemes
the company has operated discretionary 
share option arrangements and other vesting 
arrangements which were put in place prior to 
the company’s admission to the london stock 
exchange in 2006 some of these arrangements 
were subject to performance conditions as 
summarised in note 25 to the financial statements 
share option plan “sop”
any group employee is eligible to participate 
in the sop at the discretion of the committee 
executive directors and employees who participate 
in the psp will not participate in the sop at 
any same granting period awards may not be 
granted under the sop more than ten years after 
shareholder approval of the sop was obtained
performance share plan continued
financial year ending 30 september 2012 
continued
the awards shall vest and be exercisable 
on 21 november 2014 to the extent that the 
cumulative operating cash flow for the three 
financial years ending 30 september 2014 
reaches a specified figure as set out below
the number of shares which vest upon achieving 
a result between the minimum and maximum 
targets for each measure will be determined 
on a straightline basis
the sop comprises two parts a plan approved 
by hm revenue  customs that provides for 
the award of uk tax qualified options and an 
unapproved plan this structure enables the 
company to utilise certain uk tax benefits and 
retain the flexibility to provide where necessary 
options in excess of the limits imposed by uk tax 
legislation it is also intended that the sop will 
be able to provide us based employees with 
incentive stock options “iso” so as to achieve 
certain tax efficiencies in the united states 
an employee may not normally receive options 
under the sop in any financial year over shares 
having a market value in excess of 50 of annual 
base salary in that financial year the committee 
when granting options will set the time or times 
at which options will become exercisable as well 
as any performance conditions to which the 
options are subject 
the committee normally intends that options 
under the sop where the underlying shares have 
a market value at grant of less than £10000 will 
not be subject to performance targets however 
the committee retains the discretion to request 
performance conditions be attached to awards 
under the plan awards not subject to performance 
conditions will normally vest on the third 
anniversary of grant 
this vesting schedule may be altered to reflect 
stock market conditions and practice in different 
jurisdictions options where the underlying shares 
have a market value in excess of £10000 or in 
the discretion of the committee such awards 
with a market value of less than £10000 on 
the date of grant will be subject to performance 
conditions which will normally based on the 
same targets as those applying to awards made 
under the psp in the same financial year
saveasyouearn “saye”
the company has a shareholder approved saye 
scheme in place for ukbased employees the 
first date of grant was 24 december 2010 with 
a contract saving start date of 1 february 2011 
it is a three year subscription the committee 
resolved that the option price for this grant 
was £103 which represented the maximum 
allowable 20 discount under the plan rules 
eligible employees will have the opportunity to 
participate in this scheme in the financial year 
ending 30 september 2012 the committee once 
again resolved to offer participants the maximum 
allowable discount
employee stock purchase plan “espp”
the committee resolved at its meeting held on 
7 september 2011 to seek shareholder approval 
to implement an espp for usbased employees at 
the company’s annual general meeting to be held 
on 21 february 2012 this incentive scheme 
mirrors the type and efficiencies of the saye 
scheme currently in place in the uk details of 
the proposed espp will be available in the 
notice of annual general meeting 
   award vesting
performance measure  25 100
adjusted eps  090 120
cumulative adjusted cash flow 
from operations  75m 100m
3optsar11middlejennyshindd   20 17012012   110727 optos plc annual report and accounts 2011 48
governance
directors’ remuneration continued
the dates of the letters of appointment and their 
respective expiration dates for the nonexecutive 
directors who served during the year ended 
30 september 2010 are as follows
service agreements
the company has entered into service agreements 
with its executive directors none of which are 
for a fixed term it is the committee’s policy to 
offer service agreements for an indefinite term 
subject to termination normally on a maximum 
of six months’ notice or an equivalent severance 
payment the company has the right in its 
absolute discretion to terminate the service 
agreements at any time by making a payment in 
lieu of the notice period comprising basic salary 
bonuses based upon the bonus paid during the 
previous financial year benefits and pension 
contributions there are no other provisions for 
early termination of the service agreements
the company entered into a service agreement 
with roy davis dated 17 november 2008 which 
provided that he received a basic annual salary 
of £275000 which is reviewed annually 
a contribution of 10 of basic salary into a 
pension scheme of his choice and eligibility 
for a nonpensionable annual bonus target of 
up to 60 of his basic annualised salary which 
can rise to a maximum potential bonus of 100 
value of the annualised salary dependent upon 
certain performance related stretch conditions 
being met the agreement and hence roy davis’ 
employment may be terminated by either party 
by giving not less than six months’ written notice 
and in the event of a change in control of the 
company he is entitled to receive a further 
six months’ notice from the company roy davis’ 
service agreement provides that immediately 
preceding a change in control all thenoutstanding 
but unvested portions of the equity compensation 
in the form of awards for ordinary shares shall 
immediately become fully vested subject to 
achievement of the targets set out in the service 
agreement and at all times the discretion of 
the committee 
the company entered into a service agreement 
with christine soden dated 1 december 2009 
which provided that she receive a basic annual 
salary of £200000 which is reviewed annually 
a contribution of 10 of basic salary into a 
    date of letter  expiry 
nonexecutive director   of appointment  date
peter fellner    01012010  31122012
peter kehoe   01102010  30092013
barry rose   27012009  26012012
rosalyn wilton   01082010  31072013
appointed during year 
john goddard
1
   01062011  31052014
david wilson
2
   01062011  31052014
    date of letter  expiry 
resigned during year   of appointment  date
patrick paul
3
   27012009  26012012
1 john goddard was appointed to the board as a nonexecutive director on 1 june 2011 
2 david wilson was appointed to the board as a nonexecutive director on 1 june 2011 
3 patrick paul resigned from the board as a nonexecutive director on 23 february 2011
pension scheme of her choice and eligibility for 
a nonpensionable annual bonus target of up to 
50 of her basic annualised salary which can 
rise to a maximum potential bonus of 100 value 
of the annualised salary dependent upon certain 
performance related stretch conditions being met 
the agreement and hence christine soden’s 
employment may be terminated by either 
party by giving not less than six months’ 
written notice and in the event of a change in 
control of the company she is entitled to receive 
a further six months’ notice from the company 
christine soden’s service agreement provides 
that immediately preceding a change in control 
all thenoutstanding but unvested portions of the 
equity compensation in the form of awards for 
ordinary shares shall immediately become fully 
vested subject to achievement of the targets set 
out in the service agreement and at all times 
the discretion of the committee
nonexecutive directors
the company’s policy is to establish and 
maintain a body of nonexecutive directors 
with a breadth of skills and experience that is 
appropriate to the company’s size and business 
in this context it is the board’s policy for the 
nonexecutive directors to be paid a level of fee 
that reflects market conditions and is sufficient 
to attract individuals with appropriate knowledge 
and experience the board seeks to pay the 
market rate to reflect the time taken to carry 
out the role of a nonexecutive director
the company has entered into a letter of 
appointment with each of its nonexecutive 
directors each letter of appointment is for a 
fixed threeyear renewable term and includes 
a provision that either party may terminate the 
appointment at any time during the term of 
appointment by giving three months’ notice 
of termination the appointment may also be 
terminated any time in accordance with the 
articles of association or as may be required 
under the law 
  30 september 2011  01 october 2010
    ordinary share  ordinary share 
director   shares options  shares options
roy davis   25000 1030476 25000 740000
peter fellner   — — — —
john goddard  — — — —
peter kehoe  — — — —
barry rose  35000 — 35000 —
christine soden  25000 380476 25000 190000
david wilson  — — — —
rosalyn wilton  12500 — 12500 —
director resigned during  
year ended 30 september 2010   
patrick paul
1
  5112410 — 5112410 —
1  4732867 shares are held in the name of patrick paul and 379543 are held in the name 
of chester investments limited of which patrick paul controls 100 of the issued share capital 
patrick paul resigned from the board as nonexecutive director on 23 february 2011
3optsar11middlejennyshindd   21 17012012   110727 optos plc annual report and accounts 2011 49
overview
business review
governance
financial statements
directors’ interests
the beneficial and nonbeneficial interests in the 
ordinary shares of the company of each person 
who served as a director during the financial 
year ended 30 september 2011 are shown on 
the previous page
the interests of the directors to subscribe for or 
acquire ordinary shares have not changed since 
the financial year ended 30 september 2011
           year to year to 
          30 september 30 september 
        year to year to 2011 2010 
        30 september 30 september pension pension 
directors    salaryfees bonus benefits 2011 2010 contribution contribution 
at 30 september 2011    ’000 ’000 ’000 ’000 ’000 ’000 ’000
executive    salary      
roy davis    495 243 — 738 665 49 43
christine soden    322 176 1 499 400 32 26
salary subtotal     817 419 1 1237 1065 81 69
       
nonexecutive    fees      
peter fellner    137 — — 137 98 — —
john goddard
1
    19 — — 19 — — —
peter kehoe    52 — — 52 — — —
barry rose     78 — — 78 55 — —
david wilson
2
    19 — — 19 — — —
rosalyn wilton     70 — — 70 52 — —
retirees       
patrick paul
3
    19 — — 19 44 — —
fee subtotal    394 — — 394 249 — —
totals    1211 419 1 1631 1314 81 69
1 represents fees paid to john goddard from 1 june 2011 to 30 september 2011 
2 represents fees paid to david wilson from 1 june 2011 to 30 september 2011 
3 represents fees paid to patrick paul from 1 october 2010 to 23 february 2011 the date on which patrick paul resigned from the board as a nonexecutive director
directors’ remuneration audited
the remuneration in respect of qualifying services 
of each person who served as a director during 
the financial year ended 30 september 2011 is 
shown below no director took part in discussions 
or decisions relating to his or her own remuneration 
all amounts are audited and expressed in 
us dollars which is the company’s functional 
reporting currency all directors were paid in 
sterling the average exchange rate used during 
the year ended 30 september 2011 was 161 
to £100 2010 156 to £100 
3optsar11middlejennyshindd   22 17012012   110727 optos plc annual report and accounts 2011 50
governance
directors’ remuneration continued
nonexecutive directors’ remuneration
the chairman received £85000 as a basic annual 
fee nonexecutive directors received a basic fee 
of £35000 per annum committee chairmen receive 
an additional fee supplement of £7500 per annum 
and the senior independent director receives 
an additional fee supplement of £5000 to the 
basic annual fee 
under the articles of association the remuneration 
of the nonexecutive directors is limited to an 
aggregate of £350000 per annum or such other 
amount as may from time to time be determined 
by an ordinary resolution of the company 
the aggregated amount of fees paid to  
nonexecutive directors during the year ended 
30 september 2011 was 394000 £247000 
and for the year ended 30 september 2010 the 
amount was 326000 £207750
share awards and options granted to directors 
audited
details of share awards and options for each 
person who served as a director during the 
financial year ended 30 september 2011 are 
set out in the table below 
aggregate gains made by directors on the exercise 
of share options amounted to nil 2010 nil 
the market price of the company’s shares 
as at 30 september 2011 was £14675 the 
highest market price during the financial year 
to 30 september 2011 was £20775 the 
lowest market price during the financial year 
to 30 september 2011 was £09650
   granted exercised lapsed 
  year during during during 
  beginning year ended year ended year ended year ended     earliest 
  1 october 30 september 30 september 30 september 30 september exercise  date of  date of   expiry 
director 2010 2011 2011 2011 2011 price  grant  exercise  date
roy davis  490000 — — — 490000 £002  10032009  10032012 09032019
   250000 — — — 250000 £002  15122009  14122012 14122019
   — 290476 — — 290476 £002  24112010  23112013 23112020
total  740000 290476 — — 1030476 —  —  — —
christine soden  150000 — — — 150000 £002  15122009  14122012 14122019
   40000 — — — 40000 £002  20052010  19052013 19052019
   — 190476 — — 190476 £002  24112010  23112013 23112020
total  190000 190476 — — 380476 —  —  — —
3optsar11middlejennyshindd   23 17012012   110728 optos plc annual report and accounts 2011 51
overview
business review
governance
financial statements
performance graph
the following graph shows the company’s 
performance measured by the tsr compared 
with the performance of the ftse small cap and 
the ftse all share and healthcare equipment and 
services rebased indices the board believes 
these comparisons are the most relevant
by order of the board
john mcneil
company secretary
21 november 2011
3optsar11middlejennyshindd   24 17012012   110731 optos plc annual report and accounts 2011 52
we have audited the financial statements of optos plc for the year ended 30 september 2011 which comprise consolidated income statement the group and 
company balance sheets the consolidated statement of comprehensive income the group and company statements of changes in equity the group and company 
cash flow statements and the related notes 1 to 28 the financial reporting framework that has been applied in their preparation is applicable law and international 
financial reporting standards “ifrss” as adopted by the european union and as regards the parent company financial statements as applied in accordance with 
the provisions of the companies act 2006
this report is made solely to the company’s members as a body in accordance with chapter 3 of part 16 of the companies act 2006 our audit work has been 
undertaken so that we might state to the company’s members those matters we are required to state to them in an auditor’s report and for no other purpose to the 
fullest extent permitted by law we do not accept or assume responsibility to anyone other than the company and the company’s members as a body for our audit 
work for this report or for the opinions we have formed 
respective responsibilities of directors and auditors
as explained more fully in the directors’ responsibilities statement set out on page 42 the directors are responsible for the preparation of the financial statements 
and for being satisfied that they give a true and fair view our responsibility is to audit and express an opinion on the financial statements in accordance with 
applicable law and international standards on auditing uk and ireland those standards require us to comply with the auditing practices board’s ethical standards 
for auditors
scope of the audit of the financial statements
an audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial 
statements are free from material misstatement whether caused by fraud or error this includes an assessment of whether the accounting policies are appropriate 
to the group’s and the parent company’s circumstances and have been consistently applied and adequately disclosed the reasonableness of significant accounting 
estimates made by the directors and the overall presentation of the financial statements in addition we read all the financial and nonfinancial information in the 
annual report and accounts to identify material inconsistencies with the audited financial statements if we become aware of any apparent material misstatements 
or inconsistencies we consider the implications for our report
opinion on financial statements
in our opinion
•	 the financial statements give a true and fair view of the state of the group’s and of the parent company’s affairs as at 30 september 2011 and of the group’s 
profit for the year then ended
•	 the group financial statements have been properly prepared in accordance with ifrss as adopted by the european union 
•	 the parent company financial statements have been properly prepared in accordance with ifrss as adopted by the european union and as applied in accordance 
with the provisions of the companies act 2006 and
•	 the financial statements have been prepared in accordance with the requirements of the companies act 2006 and as regards the group financial statements 
article 4 of the ias regulation
financial statements
independent auditors’ report 
to the members of optos plc
0optsar11backjennyshindd   1 17012012   110539 optos plc annual report and accounts 2011 53
overview
business review
governance
financial statements
opinion on other matters prescribed by the companies act 2006
in our opinion
•	 the part of the directors’ remuneration report to be audited has been properly prepared in accordance with the companies act 2006 
•	 the information given in the directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements and
•	 the information given in the corporate governance statement set out on pages 33 to 34 with respect to internal control and risk management systems in relation 
to financial reporting processes and about share capital structures is consistent with the financial statements
matters on which we are required to report by exception
we have nothing to report in respect of the following
under the companies act 2006 we are required to report to you if in our opinion
•	 adequate accounting records have not been kept by the parent company or returns adequate for our audit have not been received from branches not visited by us 
or
•	 the parent company financial statements and the part of the directors’ remuneration report to be audited are not in agreement with the accounting records 
and returns or
•	 certain disclosures of directors’ remuneration specified by law are not made or
•	 we have not received all the information and explanations we require for our audit or
•	 a corporate governance statement has not been prepared by the company
under the listing rules we are required to review
•	 the directors’ statement set out on page 37 in relation to going concern 
•	 the part of the corporate governance statement relating to the company’s compliance with the nine provisions of the uk corporate governance code specified 
for our review and
•	 certain elements of the report to shareholders by the board on directors’ remuneration
mark harvey senior statutory auditor
for and on behalf of ernst  young llp statutory auditors
glasgow
21 november 2011
0optsar11backjennyshindd   2 17012012   110539 optos plc annual report and accounts 2011 54
notes
financial statements
consolidated income statement
for the year ended 30 september 2011
     2011 2011 
     before exceptional 
     exceptional items 
      items note 4 2011 2010 
   notes    m  m  m m 
revenue   5   1433  — 1433 1063 
cost of sales     519  — 519 354 
gross profit     914  — 914 709 
selling and distribution costs   5   284  — 284 245 
administrative and other expenses   5   379  07 386 289 
operating profit     251  07 244 175 
finance revenue   6    09  — 09 02 
finance costs   6    33  —  33 50 
profit from continuing operations before taxation  5   227  07  220 127 
income tax credit   8    05  03 08 13 
net profit for the year attributable to  
equity holders of the parent      232  04  228 140 
profit before taxation per ordinary share 
basic   9    319c  — 310c 181c 
diluted   9    317c  —  307c 181c 
profit after taxation per ordinary share 
basic   9    326c  —  321c 200c 
diluted   9    324c  —  318c 199c
consolidated statement of comprehensive income
for the year ended 30 september 2011
       2011  2010 
       m  m 
profit for the year       228  140 
other comprehensive income 
exchange differences on foreign operations       02  04 
deferred tax associated with sharebased payment transactions     05  — 
other comprehensive income for the year after tax      03  04 
total comprehensive income for the year       231  144
0optsar11backjennyshindd   3 17012012   110540 optos plc annual report and accounts 2011 55
overview
business review
governance
financial statements
notes
group and company balance sheets
as at 30 september 2011
     group  company
     2011  2010 2011 2010 
    notes m  m m m
assets 
noncurrent assets 
property plant and equipment    10  413  634 73 81
intangible assets    11  271  81  110 80
investments in subsidiaries    12  —  —  157 14
finance lease receivables    13  192  53  16 02
deferred tax asset    8  100  110  68 55
total noncurrent assets     976  878  424 232
current assets 
inventories    4  246  58  98 43
finance lease receivables    13  66  20  06 01
trade and other receivables    15 251  141  799 463
cash and cash equivalents    16 102  412  36 332
total current assets     665  631  939 839
total assets     1641  1509  1363 1071
equity and liabilities 
equity 
issued capital     25  25  25 25
share premium     1197  1182  1197 1182
retained deficit     213  455  87 258
foreign exchange reserve     04  02  — —
total equity     1005  750  1135 949
noncurrent liabilities 
financial liabilities    17  142  364  01 —
provisions    18 02  01  02 01
government grants    19 01  03  01 03
total noncurrent liabilities     145  368  04 04
current liabilities 
trade and other payables    20  267  122  213 116
provisions    18 02  —  01 —
financial liabilities    17  220  259  08 —
government grants    19 02  02  02 02
income tax payable    8  —  08  — —
total current liabilities     491  391  224 118
total liabilities     636  759 228 122
total equity and liabilities     1641  1509 1363 1071
approved by the board of directors on 21 november 2011 and signed on its behalf by 
christine soden 
director
0optsar11backjennyshindd   4 17012012   110540 optos plc annual report and accounts 2011 56
notes
financial statements
group and company statements of changes in equity
for the year ended 30 september 2011
    share  share  retained  foreign  
    capital  premium  earnings  exchange  total 
group  notes  m  m  m  m  m 
at 1 october 2009    25  1167  600  06  586 
exchange differences on foreign operations     — —  —  04  04 
profit for the year    —  —  140  —  140 
total comprehensive income for year    —  —  140  04  144 
issue of ordinary share capital   24  —  15  —  —  15 
sharebased payments   25  —  —  05  —  05 
at 30 september 2010    25  1182  455  02  750 
other comprehensive income    —  —  05  02  03 
profit for the year    —  —  228  —  228 
total comprehensive income for year    —  —  233  02  231 
issue of ordinary share capital   24  —  15  —  —  15 
sharebased payments   25  —  —  09  —  09 
at 30 september 2011    25  1197  213  04  1005
    share  share  retained  foreign  
    capital  premium  earnings  exchange  total 
company  notes  m  m  m  m  m 
at 1 october 2009    25  1167  341 — 851 
profit for the year    —  —  78  —  78 
total comprehensive income for year    —  —  78  —  78 
issue of ordinary share capital   24  —  15  —  —  15 
sharebased payments   25  —  —  05  —  05 
at 30 september 2010    25  1182  258  —  949 
other comprehensive income    —  —  04  —  04 
profit for the year    —  —  158  —  158 
total comprehensive income for year    —  —  162  —  162 
issue of ordinary share capital   24  —  15  —  —  15 
sharebased payments   25  —  —  09  —  09 
at 30 september 2011    25  1197  87  —  1135
share premium 
share premium comprises the cumulative difference between the net proceeds and nominal value of the company’s issued 
equity share capital 
foreign exchange reserve 
this reserve includes all cumulative differences on the translation of the group’s net investment in foreign operations optos elected 
to deem the cumulative differences on the retranslation into us dollars of the group’s net investment in foreign operations to 
be nil as at 1 october 2004 as a result in the event of any future disposal of a foreign operation any gain or loss on disposal 
will include cumulative translation differences arising only on or after 1 october 2004
0optsar11backjennyshindd   5 17012012   110540 optos plc annual report and accounts 2011 57
overview
business review
governance
financial statements
notes
group and company cash flow statements
for the year ended 30 september 2011
     group  company
     2011  2010 2011 2010 
    note m  m m m
operating activities 
profit for the year     228  140  158 78
adjustments to reconcile profit for the year  
to net cash inflow from operating activities 
income tax credit     08  13  09 08
finance costs net of finance revenue     32  48  — 01
depreciation amortisation and impairment of noncurrent assets   280  316  62 56
contingent consideration     17  —  17 —
property plant and equipment scrapped     05  03  01 06
medical devices held in ppe disposed of     122  32  13 04
sharebased payments     09  05  07 03
revenue recognised from device sales under finance leases    198  77  21 04
increasedecrease in trade and other receivables    115  46  333 35
amortisation of government grants     02  03  02 02
increasedecrease in inventories     80  26  43 02
increase in trade and other payables     117  33  98 47
increase in provisions     03  —  02 —
cash flow from operating activities     376  464  84 212
tax on continuing operations     04  —  — —
net cash flow from operating activities     372  464  84 212
cash flow from investing activities 
bank interest receivable     01  01  — 01
finance lease interest receivable     08  01  — —
purchases of property plant and equipment     240  175  48 17
acquisition of subsidiary net of cash acquired     108  —  108 —
expenditure on intangible assets     65  16  64 16
cash receipts from finance lease receivables     26  04  03 01
net cash flow from investing activities     378  185  217 31
cash flow from financing activities 
proceeds from finance leases     36  242  — —
repayment of finance leases     315  374  — —
proceeds from share issues     05  15  05 15
interest paid     33  50  — —
net cash flow from financing activities     307  167  05 15
net increase in cash and cash equivalents     313  112  296 196
effect of foreign exchange on cash and cash equivalents    03  01  — —
cash and cash equivalents at beginning of year    412  301  332 136
cash and cash equivalents at end of year   16 102  412 36 332
0optsar11backjennyshindd   6 17012012   110540 optos plc annual report and accounts 2011 58
financial statements
notes to the consolidated financial statements
for the year ended 30 september 2011
1 authorisation of financial statements and statements of compliance
the consolidated financial statements of optos plc for the year ended 30 september 2011 were approved and authorised for issue by the directors on 21 november 2011 
optos plc is a limited company incorporated in scotland and is listed on the london stock exchange
the consolidated financial statements of optos plc have been prepared in accordance with ifrs as adopted by the european union and applied in accordance with the 
provisions of the companies act 2006
2 accounting policies
the principal accounting policies adopted in the preparation of these financial statements are set out below these policies have been consistently applied to the 
years presented unless otherwise stated
i basis of preparation and accounting policies
a basis of preparation 
the financial statements have been prepared in accordance with the accounting policies based on ifrs and ifric interpretations endorsed by the european union 
“eu” and with those parts of the companies act 2006 applicable to companies reporting under ifrs
the consolidated financial statements are presented in us dollars as this is the group and company’s functional currency and all values are rounded to the nearest 
one hundred thousand 00m except when otherwise indicated
having considered uncertainties under the current economic environment and after making enquiries the directors have a reasonable expectation that the company 
and the group have adequate resources to continue in operational existence for the foreseeable future accordingly they continue to adopt the going concern basis in 
preparing the annual report and accounts 
this conclusion has been reached having considered the effect of liquidity risk on the group’s ability to operate effectively currently liquidity risk is not considered 
a significant business risk to the group given its level of cash available debt facilities and cash flow projections the key liquidity risks faced by the group are considered 
to be the failure of banks where funds are deposited and the inability to secure additional debt finance in order to facilitate the expansion of the group’s business or 
to introduce new or improved products
as part of this review the directors considered the current levels of available debt facilities the structure of the debt finance being multiple assetbacked arrangements 
that are nonrecourse on the company and the availability of other sources of debt capital including the 30m revolving credit facility the directors also considered 
the levels of future cash flows guaranteed under its rental customer agreements and the pattern of future debt repayments associated with current finance obligations
sharebased payments previously shown in the income statement are now included within administrative and other expenses as they are no longer considered to be 
exceptional the amounts are disclosed in note 5
no company profit and loss account is presented for optos plc as permitted by section 408 of the companies act 2006
0optsar11backjennyshindd   7 17012012   110540 optos plc annual report and accounts 2011 59
overview
business review
governance
financial statements
2 accounting policies continued
i basis of preparation and accounting policies continued
b basis of consolidation
business combinations are accounted for using the acquisition method the cost of an acquisition is measured as the aggregate of the consideration transferred 
measured at acquisition date fair value and the amount of any noncontrolling interest in the acquiree the choice of measurement of noncontrolling interest either 
at fair value or at the proportionate share of the acquiree’s identifiable net assets is determined on a transaction by transaction basis acquisition costs incurred are 
expensed and included in administrative expenses
when the group acquires a business it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the 
contractual terms economic circumstances and pertinent conditions as at the acquisition date this includes the separation of embedded derivatives in host contracts 
by the acquiree
any contingent consideration to be transferred by the acquirer will be recognised at fair value at the acquisition date subsequent changes to the fair value of the 
contingent consideration which is deemed to be an asset or liability will be recognised in accordance with ias 39 either in profit or loss or in other comprehensive 
income if the contingent consideration is classified as equity it should not be remeasured until it is finally settled within equity
goodwill is initially measured at cost being the excess of the aggregate of the acquisitiondate fair value of the consideration transferred and the amount recognised 
for the noncontrolling interest and where the business combination is achieved in stages the acquisitiondate fair value of the acquirer’s previously held equity 
interest in the acquiree over the net identifiable amounts of the assets acquired and the liabilities assumed in exchange for the business combination assets acquired 
and liabilities assumed in transactions separate to the business combinations such as the settlement of preexisting relationships or postacquisition remuneration 
arrangements are accounted for separately from the business combination in accordance with their nature and applicable ifrss identifiable intangible assets meeting 
either the contractuallegal or separability criterion are recognised separately from goodwill contingent liabilities representing a present obligation are recognised 
if the acquisitiondate fair value can be measured reliably
if the aggregate of the acquisitiondate fair value of the consideration transferred and the amount recognised for the noncontrolling interest and where the business 
combination is achieved in stages the acquisitiondate fair value of the acquirer’s previously held equity interest in the acquiree is lower than the fair value of the 
assets liabilities and contingent liabilities and the fair value of any preexisting interest held in the business acquired the difference is recognised in profit and loss
after initial recognition goodwill is measured at cost less any accumulated impairment losses for the purpose of impairment testing goodwill acquired in a business 
combination is from the acquisition date allocated to each of the group’s cashgenerating units or groups of cashgenerating units that are expected to benefit from 
the combination irrespective of whether other assets or liabilities of the acquiree are assigned to those units each unit or group of units to which goodwill is allocated 
shall represent the lowest level within the entity at which the goodwill is monitored for internal management purposes and not be larger than an operating segment 
before aggregation
where goodwill forms part of a cashgenerating unit and part of the operation within that unit is disposed of the goodwill associated with the operation disposed of 
is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation goodwill disposed of in this circumstance is measured 
based on the relative values of the operation disposed of and the portion of the cashgenerating unit retained
subsidiary undertakings are entities controlled by the group control exists when the group has the power directly or indirectly to govern the financial and operating 
policies of an entity so as to obtain benefits from its activities in assessing control potential voting rights that presently are exercisable or convertible are taken into 
account the financial statements of subsidiary undertakings are included in the consolidated financial statements from the date that control commences until the date 
that control ceases the financial statements of the subsidiary undertakings are prepared for the same reporting year as the parent company using consistent accounting 
policies all intercompany balances and transactions including unrealised profits arising from intragroup transactions have been eliminated in full
all intercompany balances and transactions including unrealised profits arising from intragroup transactions have been eliminated in full
0optsar11backjennyshindd   8 17012012   110540 optos plc annual report and accounts 2011 60
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
2 accounting policies continued
i basis of preparation and accounting policies continued
c ifrs 8 “operating segments”
the group has adopted ifrs 8 “operating segments” the group has two reportable segments being north america and rest of world markets in assessing 
performance and making resource allocation decisions the operating board which is the group’s chief operating decisionmaking body and the board review 
revenues and gross profits by segment the group derives all its revenues from rental agreements service contracts sales of devices under finance leases and 
outright sales of medical devices
the business is managed on an integrated basis with functions managed globally and decisions reached through crossfunctional committees in particular research 
and development is actively targeted at new products and at enhancing the existing products for all markets manufacturing marketing sales regulatory and support 
functions are managed and operate on a global basis and are not specific to individual markets or products
d investments
investments in subsidiaries are held at historical cost less any applicable provision for impairment
e exceptional items
material items of income and expense which because of the nature and infrequency of the events giving rise to them merit separate presentation to allow a better 
understanding of the elements of the group’s financial performance for the prior year are presented as exceptional items on the face of the income statement to 
facilitate comparisons with the current period and assessment of trends in financial performance
f foreign currency translation
the consolidated financial statements are presented in us dollars which is the group’s functional and presentation currency each entity in the group determines its own 
functional currency and items included in the financial statements of each entity are measured using that functional currency transactions in foreign currencies are 
initially recorded in the functional currency rate ruling at the date of the transaction monetary assets and liabilities denominated in foreign currencies are retranslated 
at the functional currency rate of exchange ruling at the balance sheet date all differences are taken to profit or loss with the exception of differences on foreign 
currency borrowings that provide a hedge against a net investment in a foreign entity these are taken directly to equity until the disposal of the net investment 
at which time they are recognised in profit or loss tax charges and credits attributable to exchange differences on those borrowings are also dealt with in equity 
nonmonetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions 
nonmonetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value was determined
the functional currency of the foreign operations optos canada inc optos gmbh and optos australia is the canadian dollar euro and australian dollar respectively 
as at the reporting date the assets and liabilities of these subsidiaries are translated into the presentation currency of optos plc the us dollar at the rate of exchange 
ruling at the balance sheet date and their income statements are translated at the weighted average exchange rates for the year the exchange differences arising on 
the translation are taken directly to a separate component of equity on disposal of a foreign entity the deferred cumulative amount recognised in equity relating to 
that particular foreign operation is recognised in the income statement the company’s share capital and share premium account are denominated in sterling and are 
translated at the historical rates of exchange
optos has elected to deem the cumulative differences on the retranslation into us dollars of the group’s net investment in foreign operations to be nil as at 
1 october 2004 as a result in the event of a future disposal of a foreign operation any gain or loss on disposal will only include cumulative translation differences 
arising on or after 1 october 2004
0optsar11backjennyshindd   9 17012012   110540 optos plc annual report and accounts 2011 61
overview
business review
governance
financial statements
2 accounting policies continued
i basis of preparation and accounting policies continued
g property plant and equipment
property plant and equipment is stated at cost of acquisition or manufacture less accumulated depreciation and accumulated impairment in value in the case of 
medical devices certain of the costs of manufacture relate to the capitalisation of directly attributable internal labour costs the employee costs and appropriate 
overheads associated with upgrading and installing the devices at the relevant customer site under operating leases are also capitalised 
depreciation is provided on all property plant and equipment at rates calculated to write off the cost less estimated residual values based on prices prevailing at the 
balance sheet date of each asset evenly over its expected useful life as follows
medical devices    three to five years
leasehold improvements   lesser of ten years or period of the lease
other plant and equipment  three to ten years
medical devices refer to retinal examination equipment being used or expected to be used under operating lease rental agreements medical devices are depreciated 
from the point of activation at the relevant customer site in the case of a device that is removed from one customer site upgraded and relocated to a new customer 
site depreciation is recalculated to write off the remaining net book value of that device together with the additional capitalised costs relating to the upgrade and 
installation over the remaining useful life of the asset
medical devices expected to be sold outright or by way of finance lease are held as inventory
the carrying values of plant and equipment are reviewed for impairment when events or changes in circumstances indicate that the carrying value may not be 
recoverable when an item of property plant and equipment is sold after the end of its rental term sale proceeds are recorded as revenue with the remaining net 
book value of the device or inventory carrying value recorded as cost of goods
the assets’ residual values useful lives and depreciation methods are reviewed and adjusted if appropriate at each financial year end
the company launched its new 200tx device in march 2011 and determined that these devices would have an expected useful life of four years if held as a fixed 
asset for use by the business or rental under operating lease contracts
0optsar11backjennyshindd   10 17012012   110540 optos plc annual report and accounts 2011 62
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
2 accounting policies continued
i basis of preparation and accounting policies continued
h leases
group as a lessor
arrangements between optos and its customers are assessed on a case by case basis taking into account the terms of the contract the fair value and the estimated 
residual life of the underlying device 
finance leases
arrangements between optos and the customer where substantially all of the risks and rewards incidental to ownership of the asset have been transferred to the 
customer are classified as finance leases the group makes this assessment at the inception of the lease or at the date of contract extension on the basis of one or 
more of the following factors
•	 the lease transfers ownership of the equipment to the customer by the end of the lease term 
•	 the customer has a right to buy the equipment either during the term of the lease or at the end of the lease at an advantageous price and it is reasonable certain at 
the inception of the lease that this option will be exercised
•	 the lease term covers the major part of the estimated useful life of the asset or
•	 the present value of the minimum lease payments amounts to substantially all of the fair value of the asset 
an amount equal to the fair value of the asset or if lower the present value of the minimum lease payments is recognised as revenue in the income statement and 
as an asset in the statement of financial position the fair value of service and maintenance is released to the income statement on a straight line basis over the lease 
term finance income is recognised on the basis of a constant monthly rate of return on the net investment in the finance lease which is equivalent to the incremental 
borrowing rate charged to the group the transaction is treated as a disposal and the carrying value of the device either in plant property and equipment or inventories 
recorded as a cost in the income statement in accordance with the policy for outright sales
operating leases
arrangements between optos and the customer where substantially all of the risks and rewards incidental to ownership of the asset have not been transferred to the 
customer are classified as operating leases the group makes this assessment based on the following factors
•	 ownership of the asset does not transfer to the customer at the end of the lease term and there is no advantageous acquisition option for the customer at the end 
of the lease
•	 the estimated useful life of the asset is considered to be five years which is significantly in excess of the lease term andor
•	 at the inception of the lease the present value of the minimum lease payments is significantly less than the fair value of the asset
the majority of the group’s contracts commit the customer to pay a fixed monthly sum the “mmp” plus a variable monthly sum should the usage of the device exceed 
the minimum agreed level variable rental these fixed rental payments from operating leases are recognised monthly in the income statement on a straight line basis 
over the lease term variable rentals are recognised monthly in line with actual usage of the device
0optsar11backjennyshindd   11 17012012   110540 optos plc annual report and accounts 2011 63
overview
business review
governance
financial statements
2 accounting policies continued
i basis of preparation and accounting policies continued
h leases continued
group as a lessee
finance leases
assets held by the group under finance leases which transfer to the group substantially all the risks and benefits incidental to ownership of the leased item are 
capitalised at the inception of the lease at the fair value of the item or if lower at the present value of the minimum future lease payments upon placement of 
medical devices at a customer site and where the customer enters into a fixed term contract to pay the group fixed and variable amounts of revenue the group 
selectively enters into a financing agreement with thirdparty providers of debt finance the debt finance provider advances the group funds in return for taking 
the right to receive the fixed revenue streams and legal title to the device over the term of the finance arrangement 
in such cases there is a transfer of legal title of the relevant device to the debt provider with legal title being transferred back to the group at the end of the term of 
the debt as the significant risks and rewards of ownership are retained by the group the finance received from the debt providers is recorded as fixedrate obligations 
which are repayable by instalments and are secured over the related medical device in such cases the medical devices are recorded as property plant and equipment 
and the debt finance as finance leases payable lease payments payable under the medical device finance arrangements are apportioned between the finance charges 
and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability with the finance charges being charged directly 
against income over the lease term
leased assets are depreciated over the estimated useful life of the asset or where there is no reasonable certainty that the group will obtain ownership by the end 
of the lease term over the lease term if shorter
operating leases
leases where the lessor retains a significant portion of the risks and benefits of ownership of the asset are classified as operating leases and rentals payable are 
recognised in the income statement on a straight line basis over the lease term 
i intangible assets
intangible assets are carried at cost less accumulated amortisation and accumulated impairment losses with the exception of certain development costs internally 
generated intangible assets are not capitalised and expenditure is charged against profits in the year in which the expenditure is incurred purchased intangible assets 
are capitalised at cost and amortised over the expected useful life of the asset intangible assets acquired as a result of a business combination are initially recognised 
at their fair value in accordance with ifrs 3 “business combinations” if an intangible asset is considered to have suffered impairment in value it is written down to its 
estimated recoverable amount in accordance with the group’s policy on impairment
research and development costs
research costs are expensed as incurred development expenditure incurred on an individual project is capitalised when the group can demonstrate the technical 
feasibility of completing the project so that it will be available for use or sale its intention to complete and its ability to use or sell the asset how the asset will 
generate future economic benefits the availability of resources to complete the asset and the ability to measure reliability the expenditure following development 
following the initial recognition of the development expenditure the cost model is applied requiring the asset to be carried at cost less any accumulated amortisation 
and accumulated impairment losses any expenditure carried forward is amortised over the benefits which are anticipated to accrue from the estimated commercial 
life of the asset from the point of full commercial launch usually five years
the carrying value of intangible assets is reviewed for impairment annually when the relevant asset is not yet in use or more frequently when an indication of 
impairment arises during the reporting year
computer software
computer software that is not integral to an item of property plant and equipment is recognised separately as an intangible asset whether acquired or developed 
internally amortisation is provided on a straight line basis so as to charge the cost of the software to the income statement over its expected useful life which is 
in the range of three to five years
0optsar11backjennyshindd   12 17012012   110540 optos plc annual report and accounts 2011 64
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
2 accounting policies continued
i basis of preparation and accounting policies continued
j impairment of assets
the group assesses at each reporting date whether there is an indication that the value of an asset may be impaired if any such indication of impairment exists 
or when annual impairment testing for an asset is required the group makes an estimate of the asset’s recoverable amount the recoverable amount of an asset or 
cashgenerating unit is the higher of its fair value less costs to sell and its value in use and is determined for an individual asset unless the asset does not generate 
cash inflows that are largely independent of those from other assets or groups of assets or cashgenerating units where the carrying amount of an asset exceeds its 
recoverable amount the asset is considered impaired and is written down to its recoverable amount in assessing value in use the estimated future cash flows are 
discounted to their present value using a pretax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset 
impairment losses of continuing operations are recognised in the income statement in those expense categories consistent with the function of the impaired asset
an assessment is made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have 
diminished if such indication exists the recoverable amount is estimated a previously recognised impairment loss is reversed only if there has been a change in 
the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised if that is the case the carrying amount of the asset 
is increased to its recoverable amount that increased amount cannot exceed the carrying amount that would have been determined net of depreciation had no 
impairment loss been recognised for the asset in prior years such reversal is recognised in the income statement after such a reversal the depreciation charge 
is adjusted in future periods to allocate the asset’s revised carrying amount less any residual value on a systematic basis over its remaining useful life
k inventories
inventories primarily comprise finished goods workinprogress and spares and components all related to medical devices inventories are valued at the lower of 
cost and net realisable value using the firstin firstout or weighted average cost basis cost of raw materials consumables and work in progress includes the cost of 
direct materials and where applicable direct labour and those overheads that have been incurred in bringing the inventories to their present location and condition 
inventory is written down on a case by case basis if the anticipated net realisable value declines below the carrying amount of the inventories net realisable value 
is the estimated selling price less estimated cost to completion and selling expenses when the reasons for a write down of the inventory have ceased to exist the 
write down is reversed
l trade and other receivables
trade receivables which generally have payment terms of 30–90 days are recognised and carried at the original invoice amount less an allowance for any 
uncollectible amounts provision is made against the receivable when there is objective evidence that the group will not be able to collect the debts balances 
are written off when the probability of recovery is assessed as being remote
m cash and cash equivalents
cash and shortterm deposits in the balance sheet comprise cash at banks and in hand and shortterm deposits with an original maturity of three months or less
n interest bearing loans and borrowings
all loans and borrowings are initially recognised at the fair value of the consideration received less directly attributable transaction costs after initial recognition 
interest bearing loans and borrowings are subsequently measured at amortised cost using the effective interest method
0optsar11backjennyshindd   13 17012012   110540 optos plc annual report and accounts 2011 65
overview
business review
governance
financial statements
2 accounting policies continued
i basis of preparation and accounting policies continued
o taxation
income tax
current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities
the tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at the balance sheet date
deferred income tax is recognised for all temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial 
statements with the following exceptions
•	 where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in a transaction that is not a business combination and 
at the time of the transaction affects neither the accounting profit nor taxable profit or loss and
•	 in respect of taxable temporary differences associated with investments in subsidiaries where the timing of the reversal of the temporary differences can be 
controlled and it is probable that the temporary differences will not reverse in the foreseeable future
deferred income tax assets are recognised for all deductible temporary differences carryforward of unused tax credits and unused tax losses only to the extent that 
it is probable that taxable profit will be available against which the deductible temporary differences and the carryforward of unused tax credits and unused tax 
losses can be utilised
the carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient 
taxable profit will be available to allow all or part of the deferred income tax asset to be utilised unrecognised deferred income tax assets are reassessed at each 
balance sheet date and are recognised to the extent that it has become probable that future taxable profit will allow the deferred tax asset to be recovered
deferred income tax assets and liabilities are measured on an undiscounted basis at the tax rates that are expected to apply to the year when the asset is realised 
or the liability is settled based on tax rates and tax laws that have been enacted or substantively enacted at the balance sheet date
income tax relating to items recognised directly in equity is recognised in equity and not in the income statement otherwise income tax is recognised in the 
income statement
deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists to set off current tax assets against current tax liabilities and the 
deferred taxes are related to the same taxable entity and the same taxation authority
sales tax
revenues expenses and assets are recognised net of the amount of sales tax or equivalent except
•	 where the sales tax incurred on a purchase of assets or services is not recoverable from the taxation authority in which case the sales tax is recognised as part 
of the cost of acquisition of the asset or as part of the expense item as applicable and
•	 in the balance sheet where receivables and payables are stated with the amount of sales tax included
the net amount of sales tax recoverable from or payable to the taxation authorities is included as part of receivables or payables in the balance sheet
0optsar11backjennyshindd   14 17012012   110541 optos plc annual report and accounts 2011 66
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
2 accounting policies continued
i basis of preparation and accounting policies continued
p sharebased payment transactions
certain employees including senior executives of the group receive remuneration in the form of sharebased payment transactions whereby employees render 
services as consideration for equity instruments “equitysettled transactions”
the cost of equitysettled transactions with employees is measured by reference to the fair value at the date at which they are granted and is recognised as an 
expense over the vesting period which ends on the date on which the relevant employees become fully entitled to the award in valuing equitysettled transactions 
no account is taken of any performance conditions other than conditions linked to the price of the shares of the company “market conditions” if applicable
no expense is recognised for awards that do not ultimately vest except for awards where vesting is conditional upon a market condition which are treated as vesting 
irrespective of whether or not the market condition is satisfied provided that all other performance conditions are satisfied
the cost of equitysettled transactions is recognised together with a corresponding movement in equity over the period in which the performance andor service 
conditions are fulfilled ending on the date on which the relevant employees become fully entitled to the award “the vesting date” the cumulative expense recognised 
for equitysettled transactions at each reporting date until the vesting date reflects the extent to which the vesting period has expired and the group’s best estimate 
of the number of equity instruments that will ultimately vest the income statement charge or credit for a period represents the movement in cumulative expense 
recognised as at the beginning and end of that period
where the terms of an equitysettled award are modified or a new award is designated as replacing a cancelled or settled award the cost based on the original award 
terms continues to be recognised over the original vesting period in addition an expense is recognised over the remainder of the new vesting period for the incremental 
fair value of any modification based on the difference between the fair value of the original award and the fair value of the modified award both as measured on the 
date of modification no reduction is recognised if this difference is negative 
where an equitysettled award is cancelled it is treated as if it had vested on the date of cancellation and any cost not yet recognised in the income statement for 
the award is expensed immediately any compensation paid up to the fair value of the award at the cancellation or settlement date is deducted from equity with any 
excess over fair value being treated as an expense in the income statement
the group took advantage of the transitional provisions of ifrs 2 in respect of equitysettled awards and applied ifrs 2 only to equitysettled awards granted after 
7 november 2002 that had not vested on 1 january 2005 where share options lapse as a result of the company terminating the employment of an individual it is 
accounted for as a forfeiture of the option
q revenue and lease income recognition
revenue is recognised to the extent that it is probable that the economic benefits will flow to the group and the revenue can be reliably measured revenue is 
measured at the fair value of the consideration received excluding discounts rebates vat and other sales tax or duties the following specific recognition criteria 
must also be met before revenue is recognised
rental income under operating leases
revenue from the provision of retinal examinations using the group’s medical devices is recognised according to the classification of the rental agreement as an 
operating lease such examinations are undertaken by customers who generally enter into agreements under which they pay a fixed monthly rental plus a variable 
monthly sum should the usage of the device exceed the minimum agreed level
these fixed monthly rental payments from agreements which have been classified as operating leases are recognised monthly on a straight line basis to the income 
statement over the lease term the variable rentals are recognised monthly in line with actual usage of the device
0optsar11backjennyshindd   15 17012012   110541 optos plc annual report and accounts 2011 67
overview
business review
governance
financial statements
2 accounting policies continued
i basis of preparation and accounting policies continued 
q revenue and lease income recognition continued
device sales under finance leases
revenue from the sale of devices which have been classified as finance leases is recognised as an amount equal to the fair value of the asset or if lower the present 
value of the minimum leased payments variable rentals are recognised to revenue each month to the extent that they cannot be reliably estimated
device sales – outright
revenue from the sale of devices is recognised in the income statement when the significant risks and rewards of ownership of the goods have passed to the buyer 
usually on dispatch or installation at the customer’s site or where relevant at the end of any validation period
service warranty and maintenance contracts
revenue from the sale of service and maintenance contracts is recognised on straight line basis over the term of the contract
finance income
finance income is recognised on the basis of a constant monthly rate of return on the net investment in the relevant finance lease
interest income
revenue is recognised as interest accrues on cash deposits or loan arrangements 
r borrowing costs
borrowing costs are recognised as an expense when incurred
s government grants
government grants are recognised where there is reasonable assurance that the grant will be received and all attaching conditions will be complied with
when the grant relates to an expense item it is recognised as income over the period necessary to match the grant on a systematic basis to the costs that it is intended 
to compensate where the grant relates to an asset the fair value is credited to a deferred income account and is released to the income statement over the expected 
useful life of the relevant assets
t postemployment benefits
postemployment benefits comprise pension healthcare benefits provided to employees throughout the world
the group operates a number of defined contribution pension schemes the assets of the schemes are invested and managed independently of the finances of the 
relevant company the contributions are recognised in the income statement in the period in which they become payable
u derecognition of financial liabilities
a financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires
0optsar11backjennyshindd   16 17012012   110541 optos plc annual report and accounts 2011 68
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
2 accounting policies continued
i basis of preparation and accounting policies continued 
v significant judgements made
in the process of applying the group’s accounting policies the board and management have made the following judgements apart from those involving estimations 
which have the most significant effect on the amounts recognised in the financial statements
medical device financing arrangements
upon placement of medical devices at a customer site where the customer enters into a fixedterm contract to pay the group fixed and variable amounts of revenue 
the group frequently enters into a financing agreement with thirdparty providers of debt finance 
the group considers the arrangement between the vendor finance provider and optos to be a finance lease as opposed to an operating lease as defined in ias 17 
because ownership of the asset reverts to optos at the end of the finance arrangement for nil consideration
the debt finance provider advances the group funds in return for taking the right to receive the fixed revenue streams and legal title to the device over the term of 
the finance arrangement
as the significant risks and rewards of ownership are retained by the group the proceeds received from the thirdparty providers of debt finance are recorded as 
fixedrate obligations which are repayable by instalments in such cases the medical devices are recorded as property plant and equipment and the debt finance as 
finance leases 
group as a lessor and rental income
revenue from the provision of retinal examinations using the group’s medical devices is recognised according to the classification of the rental agreement as either 
an operating or finance lease the group considers the arrangements between optos and its customers on a case by case basis taking into account the terms of the 
contract the fair value and the estimated residual life of the underlying device set out in note 2h above on leasing 
revenue from rental agreements which have been classified as finance leases is recognised as an amount equal to the fair value of the asset or if lower the present 
value of the minimum leased payments variable rentals are recognised to revenue each month to the extent that they have not been previously reliably estimated 
and recognised
these rental payments from agreements which have been classified as operating leases is recognised monthly in the income statement on a straight line basis to the 
income statement over the lease term
development costs
the group amortises its capitalised development costs over the anticipated benefits expected to accrue in the first five years of operations of the device or 
technology management assesses the appropriateness of the period taking into account latest market expectations further details are included in note 11
impairment of assets
the group assesses at each reporting date whether there is an indication that the value of an asset may be impaired if any such indication of impairment exists 
or when annual impairment testing for an asset is required the group makes an estimate of the asset’s recoverable amount the recoverable amount of an asset or 
cashgenerating unit is the higher of its fair value less costs to sell and its value in use and is determined for an individual asset unless the asset does not generate 
cash inflows that are largely independent of those from other assets or groups of assets or cashgenerating units where the carrying amount of an asset exceeds its 
recoverable amount the asset is considered impaired and is written down to its recoverable amount in assessing value in use the estimated future cash flows are 
discounted to their present value using a pretax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset 
impairment losses of continuing operations are recognised in the income statement in those expense categories consistent with the function of the impaired asset
an assessment is made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have 
diminished if such indication exists the recoverable amount is estimated a previously recognised impairment loss is reversed only if there has been a change in 
the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised if that is the case the carrying amount of the asset 
is increased to its recoverable amount that increased amount cannot exceed the carrying amount that would have been determined net of depreciation had no 
impairment loss been recognised for the asset in prior years such reversal is recognised in the income statement after such a reversal the depreciation charge 
is adjusted in future periods to allocate the asset’s revised carrying amount less any residual value on a systematic basis over its remaining useful life
0optsar11backjennyshindd   17 17012012   110541 optos plc annual report and accounts 2011 69
overview
business review
governance
financial statements
2 accounting policies continued
i basis of preparation and accounting policies continued 
w key sources of estimation uncertainty
the key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date that have a significant risk of causing a material 
adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below
useful lives of medical devices
the group depreciates medical devices over their estimated useful lives the board and management annually assess the appropriateness of the current estimate of 
useful life
sharebased payments
the assumptions underlying the calculation of the sharebased payments expenses are based on independent advice certain awards under the group’s longterm 
incentive plans are subject to the satisfaction of nonmarket related performance conditions these conditions are based on future business performance and the 
group makes estimates of the likelihood of these conditions being met changes in these assumptions could have a material impact on the measurement of the 
group’s sharebased payment charge further details are included in note 23
deferred tax
the group has gross unused tax losses these losses are recognised under ias 12 as deferred tax assets the group makes judgements as to the likelihood of these 
losses being recoverable and changes in these assumptions could have a material impact on the group’s reported tax charge further details are included in note 8
x new standards and interpretations
the iasb and ifric have issued the following standards and interpretations with an effective date for periods after the date of these financial statements
        effective date for 
international accounting standards ifrsias       periods commencing
ifric 14 amendment prepayments for a minimum funding requirement 1 january 2011
ifrs 9  financial instruments recognition and measurement 1 january 2013
ifrs 10  consolidated financial statements  1 january 2013
ifrs 11  joint arrangements  1 january 2013
ifrs 12  disclosures of interests in other entities 1 january 2013
ifrs 13  fair value measurement   1 january 2013
ias 24 related party disclosures revised  1 january 2011
ias 27 separate financial statements  1 january 2013
ias 28 investments in associates and joint ventures 1 january 2013
ifrs 7 amendment financial instruments disclosures  1 july 2011
ias 12 amendment recovery of underlying assets  1 january 2012
ifrs 1 amendment severe hyperinflation and removal of fixed dates for firsttime adopters 1 july 2011
ias 1 amendment presentation of other comprehensive income 1 july 2012
ias 19 amendment employee benefits  1 january 2013 
  improvements to ifrss issued may 2010 various
 not yet adopted for use in the european union
the above standards and interpretations will be adopted in accordance with their effective dates the directors do not anticipate that the adoption of these standards 
and interpretations will have a material impact on the group’s financial statements in the period of initial application
0optsar11backjennyshindd   18 17012012   110541 optos plc annual report and accounts 2011 70
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
2 accounting policies continued 
ii changes in estimates
in light of the developments outlined in the business review relating to the launch of the next generation daytona device in march 2011 the directors revised their 
estimate of the expected useful economic lives of the p200 200dx and p200c medical devices to end no later than 30 september 2014
this has had the following consequences
i  as typical lease terms will be for the major part of the remaining useful economic life of the asset even if title is not ultimately transferred the vast majority 
of new and renewed lease arrangements with customers will fall to be classified as finance leases under ias 17 the reporting standard for leases and accounted 
for accordingly this will accelerate the reduction in the proportion of future revenues expected to be derived from operating leases
ii  the expectation that these devices will now be sold either outright or by way of finance lease rather than used by the group under operating leases required 
their reclassification in the balance sheet from property plant and equipment to inventory accordingly a transfer has been made of 102m being the lower of the 
previous carrying amount of the devices and related modules and their net realisable value 
the impact of these changes was a reduction in the depreciation charge of 08m for the year ended 30 september 2011 in addition revenue increased by 112m 
and cost of sales by 42m in the year as a result of devices falling to be classified as finance leases that would previously have fallen to be classified as operating 
leases had the estimate not changed
looking forward it is difficult to reliably estimate the impact on future accounting periods since the impact is governed by the actual volumes and terms of new 
rental agreements renewal agreements and the product mix none of which are known however the expectation will be for increased revenues cost of sales and 
gross profits from finance lease transactions an increase in revenues from service contracts and a reduction in revenues from operating leases there will be a 
consequential increase in finance lease receivables and a reduction in the future amounts receivable under operating lease there will also be an increase in 
cash flows in building inventory and a reduction in the investment in plant property and equipment 
3 segmental analysis
the group has two reportable segments being north america and rest of world markets in assessing performance and making resource allocation decisions 
the operating board which is the group’s chief operating decisionmaking body and the board review revenues and gross profits by segment 
optos sells a range of diagnostic and treatment devices to healthcare professionals globally either directly or through arrangements with distributors cash flow is 
generated through the rental or sale of devices and related software and support services 
the business is managed on an integrated basis with functions managed globally and decisions reached through crossfunctional committees in particular research 
and development is actively targeted at new products and at enhancing the existing product for all markets manufacturing marketing sales regulatory and support 
functions are managed and operate on a global basis and are not specific to individual markets or products
transfer prices between segments are set in accordance with the group’s transfer pricing policy segment revenue segment expense and segment result include 
transfers between geographical segments those transfers are eliminated on consolidation
0optsar11backjennyshindd   19 17012012   110541 optos plc annual report and accounts 2011 71
overview
business review
governance
financial statements
3 segmental analysis continued
an analysis by operating segment is given below for the year ended 30 september 2011
      north america  rest of world  eliminations  total 
      2011  2011  2011  2011 
      m m m m
revenue 
operating lease and variable revenue from rental of devices     702 110 — 812
device sales under finance leases     146 52 — 198
device sales – outright     278 98 — 376
service and warranty contracts     45 02 — 47
intersegment sales     — 309 309 —
segment revenue     1171 571 309 1433
operating lease costs     211 50 — 261
cost of goods of device sales under finance leases     40 22 — 62
cost of goods of outright device sales     123 73 — 196
intersegment costs     309 — 309 —
segment gross profit     488 426 — 914
selling and distribution costs        284
administrative and other expenses        386
operating profit        244
net finance costs         24
profit from continuing operations before taxation        220
taxation        08
net profit for the year        228
assets and liabilities    
segment assets     942 1398 901 1439
unallocated assets        202
total assets        1641
segment liabilities     763 422 901 284
unallocated liabilities        352
total liabilities        636
other segment information
property plant and equipment additions     154 87 — 241
intangible fixed asset additions     36 194 — 230
depreciation     185 55 — 240
amortisation     — 40 — 40
property plant and equipment scrapped     04 01 — 05
exceptional items     — 07 — 07
0optsar11backjennyshindd   20 17012012   110541 optos plc annual report and accounts 2011 72
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
3 segmental analysis continued
unallocated assets primarily comprise cash and shortterm deposits and deferred tax assets
unallocated net liabilities comprise financial liabilities and taxation 
revenue includes 109m attributable to the uk noncurrent assets excluding deferred tax assets and investments include 361m attributable to the uk 
an analysis by operating segment is given below for the year ended 30 september 2010
      north america  rest of world  eliminations  total 
      2010  2010 2010  2010 
      m m m m
revenue 
operating lease and variable revenue from rental of devices     789 101 — 890
device sales under finance leases     71 06 — 77
device sales – outright     59 22 — 81
service and warranty contracts     15 — — 15
intersegment sales     — 235 235 —
segment revenue     934 364 235 1063
operating lease costs     275 47 — 322
cost of goods of device sales under finance leases     11 05 — 16
cost of goods of outright device sales     13 03 — 16
intersegment costs     235 — 235 —
segment gross profit     400 309 — 709
selling and distribution costs        245
administrative and other expenses        289
operating profit        175
net finance costs         48
profit from continuing operations before taxation        127
taxation        13
net profit for the year        140
assets and liabilities    
segment assets     729 779 521 987
unallocated assets        522
total assets        1509
segment liabilities     455 194 521 128
unallocated liabilities        631
total liabilities        759
0optsar11backjennyshindd   21 17012012   110541 optos plc annual report and accounts 2011 73
overview
business review
governance
financial statements
3 segmental analysis continued
      north america  rest of world  eliminations  total 
      2010  2010 2010  2010 
      m m m m
other segment information    
capital expenditure    
property plant and equipment     83 92 — 175
intangible fixed assets     — 16 — 16
depreciation     236 55 — 291
amortisation     — 25 — 25
loss on disposal of noncurrent assets     — 03 — 03
unallocated assets primarily comprise cash and shortterm deposits and deferred tax assets
unallocated net liabilities comprise financial liabilities and taxation 
revenue includes 25m attributable to the uk noncurrent assets excluding deferred tax assets include 151m attributable to the uk 
4 exceptional items
        2011  2010 
        m  m
opto global contingent consideration fair value adjustment       17 —
acquisition costs       24 —
total exceptional charges recognised in the year       07 —
the group acquired 100 of the share capital of opto global holdings pty ltd on 13 december for 143m the purchase consideration included an estimated 
25m relating to the fair value of contingent consideration the expectation is that the conditions relating to the contingent consideration will no longer be met 
in full this is due to lower than expected sales primarily the result of delays in the integration of the productsdistributors as well as the time taken to obtain 
regulatory approval as a consequence the fair value of contingent consideration has been reassessed as 08m compared to 25m at the acquisition date
the group incurred acquisition costs of 11m for optoglobal which included 05m of oneoff retention payments the balance being professional fees in addition 
the group has incurred to date 13m of professional fees in relation to the acquisition of the assets and business of the instrumentation division of opko health inc 
which completed in october 2011 
0optsar11backjennyshindd   22 17012012   110541 optos plc annual report and accounts 2011 74
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
5 revenue and expenses
        2011  2010 
        m  m
revenue
operating lease and variable revenue from rental of devices       812 890
device sales under finance leases       198 77
device sales – outright       376 81
service and warranty contracts       47 15
revenue       1433 1063
finance revenue        09 02
total revenue       1442 1065
no revenue was derived from exchanges of goods or services
operating lease and variable revenue from rental of devices includes 812m 2010 890m from rental contracts with customers where substantially all the 
risks and rewards of ownership remain with optos being 659m 2010 694m from fixed monthly minimum payments to which customers have contracted 
plus 153m 2010 196m from the variable per optomap® revenue for tests performed over the monthly minimum levels
revenue from the sales of devices classified as finance leases is the lower of an amount equal to the fair value of the asset or the present value of the minimum 
leased payments from rental contracts where the rental agreement has been assessed as a finance lease
service and warranty contracts relates to revenues from contracts to maintain and service the company’s devices
the company treats certain of the contractual arrangements with the customers as operating lease arrangements future minimum rentals receivable under noncancellable 
operating leases with customers are as follows
        2011  2010 
        m  m
not later than one year       525 654
after one year but not more than five years       518 1026
after five years       16 18
        1059 1698
0optsar11backjennyshindd   23 17012012   110541 optos plc annual report and accounts 2011 75
overview
business review
governance
financial statements
5 revenue and expenses continued
        2011  2010 
       note m  m
the profit from continuing operations before taxation is stated after chargingcrediting  
depreciation charge for the period      10 240 291
rd expenditure
1
       60 57
amortisation of software
2
      11 03 04
amortisation of acquired intangibles       06 —
operating leases       11 10
sharebased payments       12 06
foreign exchange differences       09 05
1  includes 31m 2010 21m in respect of the amortisation of intangible assets which is recognised in administrative and other expenses through the income statement in addition 
64m 2010 13m of rd expenditure was incurred which has not been charged in arriving at the pretax profit for the period as it has been capitalised as an intangible asset 
further information is included in note 11 to the group financial statements
2 amortisation of software and acquired intangibles is recognised in administrative and other expenses through the income statement
services provided by the group’s auditors and network firms
during the year the group including its overseas subsidiaries obtained the following services from the group’s auditors at costs as detailed below
        2011  2010 
        m  m
fees payable to the company’s auditors for the audit of the company’s annual accounts including estimated expenses   02 02
all other services       02 01
        04 03
profit attributable to the company
the profit for the year ended 30 september 2011 attributable to optos plc is 158m 2010 78m 
0optsar11backjennyshindd   24 17012012   110541 optos plc annual report and accounts 2011 76
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
6 financing
        2011  2010 
        m  m
finance costs
finance lease interest payable       33 50
        33 50
finance revenue  
finance lease interest receivable       08 01
bank interest receivable       01 01
        09 02
7 directors and employees
        2011  2010 
        m  m
staff costs for the group during the year  
wages and salaries       396 268
social security costs       34 23
defined contribution pension costs       05 06
sharebased payments       09 05
        444 302
sharebased schemes and outstanding options are set out in note 23
the average monthly number of persons employed during the year was as follows
        2011  2010 
        number  number
executive directors       2 2
field sales and support       176 137
manufacturing and refurbishment       97 57
product development       33 29
central       48 46
marketing       8 6
        364 277
the above tabulation excludes the nonexecutive directors
details of the fees emoluments pension contributions and gains on exercise of share options attributable to each director during the year are given in the section 
headed “directors’ remuneration” in the directors’ remuneration report on pages 43 to 51
0optsar11backjennyshindd   25 17012012   110541 optos plc annual report and accounts 2011 77
overview
business review
governance
financial statements
8 taxation
        2011  2010 
analysis of tax creditcharge in the year       m  m
tax on profit on ordinary activities
corporation tax at 27 2010 28
current year tax charge       — —
adjustment in respect of prior periods       — 02
overseas taxes – prior year       09 01
overseas taxes – current year       04 03
current year tax charge       05 —
deferred tax   
origination and reversal of timing differences       09 16
impact of tax rate change       06 03
total deferred tax credit       03 13
total income tax credit       08 13
the credit to tax for the year was 08m 2010 13m comprising a current tax credit of 05m 2010 nil and a deferred tax credit of 03m 2010 13m the current tax 
charge relates primarily to overseas tax liabilities offset by adjustments in respect of prior periods
the tax credit to the income statement includes a credit of 03m 2010 nil in relation to exceptional acquisition costs
        2011  2010 
        m  m
corporation tax reconciliation  
group profit on ordinary activities before taxation       220 127
group profit on ordinary activities multiplied by the standard rate of  
corporation tax in the uk of 27 2010 28       59 36
effects of  
permanent adjustments       05 12
change in unrecognised deferred tax assets        66 46
effect of overseas tax rates       08 05
adjustment in respect of prior periods       10 01
effect of tax rate and law changes       06 03
total tax credit for the year       08 13
0optsar11backjennyshindd   26 17012012   110541 optos plc annual report and accounts 2011 78
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
8 taxation continued
deferred income tax at 30 september 2011 and 30 september 2010 recognised in the balance sheet related to the following
      group  company
      2011 2010 2011 2010 
      m m m m
deferred tax liabilitiesassets
accelerated capital allowances     27 15 05 03
development costs     08 18 08 18
deferred revenue     14 10 — —
sharebased payments     10 04 06 03
other temporary differences     17 11 01 —
losses     94 118 64 67
net deferred income tax asset     100 110 68 55
group
the deferred tax movement results from the annual review of deferred tax asset recognition the conclusion of which is that it is appropriate based on projected 
future profitability in each of the relevant territories to recognise all deferred tax assets with the exception of tax losses incurred in australia by the opto global 
business these assets will be recovered when future tax charges are sufficient to absorb these tax benefits
the movement in the net deferred tax asset between 2010 and 2011 comprises the recognition of a 18m deferred tax liability in relation to intellectual property 
acquired with opto global as well as the 03m credit to the income statement and 05m credit to other comprehensive income
company
all deferred tax assets at 30 september 2011 have been recognised based on projected future profitability these assets will be recovered when future tax charges are 
sufficient to absorb these tax benefits deferred tax assets totalling 49m were not recognised at 30 september 2010 due to uncertainty regarding future recoverability 
deferred income tax at 30 september 2011 and 30 september 2010 recognised in the income statement related to the following
      group  company
      2011 2010 2011 2010 
      m m m m
deferred tax creditscharges    
accelerated capital allowances     06 05 02 02
development costs     10 06 10 06
deferred revenue     04 02 — —
sharebased payments     01 03 01 03
other temporary differences     06 — 01 03
losses     24 03 03 03
net deferred income tax credit     03 13 09 05
0optsar11backjennyshindd   27 17012012   110541 optos plc annual report and accounts 2011 79
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8 taxation continued
tax losses
deferred tax assets have been recognised in 2011 in respect of historic tax losses incurred in the uk us canada and germany as there is sufficient evidence in the 
form of projected future profitability to conclude that these losses will be recoverable in the foreseeable future a deferred tax asset of 18m 2010 nil relating 
to unused tax losses in australia has not been recognised as there is insufficient certainty in relation to the recoverability of the asset 
impact of future tax rate changes
the chancellor has announced that the main uk corporation tax rate will be reduced from the current rate of 26 which has applied from 1 april 2011 to 23 via 
a series of 1 annual reductions the reduction in the corporation tax rate to 25 from 1 april 2012 was enacted on 19 july 2011 as this rate was enacted at the 
balance sheet date and reduces the tax rate expected to apply when temporary differences reverse it had the effect of reducing the uk deferred tax asset by 06m 
the further rate reductions are to be incorporated within future legislative acts and so will not be substantively enacted until later periods it is expected that the 
deferred tax balance should not be materially impacted by these proposed reductions in the corporation tax rate 
9 profit per ordinary share
basic earnings per share amounts are calculated by dividing the profitloss before taxation and the profit after taxation for the financial year by the weighted 
average number of ordinary shares outstanding during the year
diluted earnings per share amounts are calculated by dividing the profit before taxation and the profitloss after taxation for the financial year by the weighted 
average number of ordinary shares outstanding during the year adjusted for the effects of dilutive options in the case of a loss no impact for further dilution is 
reflected as this would not have the effect of increasing the loss per share and is therefore not dilutive
the profit per ordinary share is calculated as follows
        2011  2010
weighted average number of ordinary shares in issue       71057274 69979015
effect of dilution share options       593191 90218
adjusted weighted average number of ordinary shares for diluted earnings per share      71650465 70069233
profit before exceptional items and taxation m       227 127
basic profit before exceptional items and taxation per share cents       319c 181c
diluted profit before exceptional items and taxation per share cents       317c 181c
profit before exceptional items after taxation m       232 140
basic profit before exceptional items after taxation per share cents       326c 200c
diluted profit before exceptional items after taxation per share cents       324c 199c
profit before taxation m       220 127
basic profit before taxation per share cents       310c 181c
diluted profit before taxation per share cents       307c 181c
profit after taxation m       228 140
basic profit after taxation per share cents       321c 200c
diluted profit after taxation per share cents       318c 199c
0optsar11backjennyshindd   28 17012012   110541 optos plc annual report and accounts 2011 80
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
10 property plant and equipment
      leasehold  medical  plant and 
      improvements  devices  equipment total 
group     m  m  m  m
cost    
at 1 october 2010     16 2098 89 2203
additions     05 208 28 241
transfer to inventory     — 446 — 446
disposals     — 545 01 546
exchange adjustment     — 19 — 19
at 30 september 2011     21 1334 116 1471
depreciation        
at 1 october 2010     10 1492 67 1569
charge for year     02 227 11 240
transfer to inventory     — 344 — 344
disposals     — 419 — 419
exchange adjustment     — 12 — 12
at 30 september 2011     12 968 78 1058
net book value at 30 september 2011     09 366 38 413
cost    
at 1 october 2009     15 2074 82 2171
additions     01 160 14 175
disposals     — 126 07 133
exchange adjustment     — 10 — 10
at 30 september 2010     16 2098 89 2203
depreciation    
at 1 october 2009     09 1310 58 1377
charge for year     01 277 13 291
disposals     — 94 04 98
exchange adjustment     — 01 — 01
at 30 september 2010     10 1492 67 1569
net book value at 30 september 2010     06 606 22 634
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10 property plant and equipment continued
   
      leasehold  medical  plant and 
      improvements  devices  equipment total 
company     m  m  m  m
cost    
at 1 october 2010     12 139 58 209
additions     — 37 12 49
transfer to inventory     — 17 — 17
disposals     — 40 — 40
at 30 september 2011     12 119 70 201
depreciation    
at 1 october 2010     08 72 48 128
charge for year     01 22 05 28
transfer to inventory     — 03 — 03
disposals     — 25 — 25
at 30 september 2011     09 66 53 128
net book value at 30 september 2011     03 53 17 73
cost    
at 1 october 2009     12 143 58 213
additions     — 11 06 17
disposals     — 15 06 21
at 30 september 2010     12 139 58 209
depreciation    
at 1 october 2009     07 54 45 106
charge for year     01 23 07 31
disposals     — 05 04 09
at 30 september 2010     08 72 48 128
net book value at 30 september 2010     04 67 10 81
medical devices refer to retinal examination equipment being used or expected to be used under operating lease agreements medical devices are depreciated from 
the point of activation at the relevant customer site in the case of a device that is removed from one customer site upgraded and relocated to a new customer site 
depreciation is recalculated to write off the remaining net book value of that device together with the additional capitalised costs relating to the upgrade and installation 
over the remaining useful economic life of the asset 
the group has reviewed the economic useful lives of all assets and has determined that certain elements of medical devices for example installation costs computer 
and other peripherals have a useful economic life of between three and five years depending on the specific circumstances of the assets including the period over 
which the medical device is expected to be maintained at a particular customer site 
0optsar11backjennyshindd   30 17012012   110542 optos plc annual report and accounts 2011 82
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
10 property plant and equipment continued
these peripheral components do not have a cost that is significant in relation to the total cost of the device and the medical device itself is still considered to have 
a useful economic life of between three and five years
the carrying value of plant and equipment and medical devices held subject to finance leases at 30 september 2011 was 137m 2010 239m for the group 
and nil 2010 nil for the company legal title to the leased assets transfers to the debt provider as security for the term of the agreement 
11 intangible assets
       licences and 
     development software  relationship goodwill 
     costs costs  costs costs total 
group    m  m m m m
cost     
at 1 october 2010    147 32 — — 179
additions – internal development    64 — — — 64
additions – purchased externally    — 01 60 105 166
disposals    — — — — —
at 30 september 2011    211 33 60 105 409
accumulated amortisation     
at 1 october 2010    72 26 — — 98
amortisation in year    31 03 06 — 40
disposals    — — — — —
at 30 september 2011    103 29 06 — 138
net carrying amount at 30 september 2011     108 04 54 105 271
cost     
at 1 october 2009    134 29 03 — 166
additions – internal development    13 — — — 13
additions – purchased externally    — 03 — — 03
disposals    — — 03 — 03
at 30 september 2010    147 32 — — 179
accumulated amortisation     
at 1 october 2009    51 22 03 — 76
amortisation in year    21 04 — — 25
impairment loss    — — 03 — 03
at 30 september 2010    72 26 — — 98
net carrying amount at 30 september 2010    75 06 — — 81
the additions of 60m related to licenses and relationship costs and 105m related to goodwill were acquired as part of the business combination
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11 intangible assets continued
       licences   
       relationship and    
     development software intellectual goodwill  
     costs costs  property costs costs total 
company    m  m m m m
cost     
at 1 october 2010    147 31 — — 178
additions – internal development    64 — — — 64
additions – purchased externally    — — — — —
disposals    — — — — —
at 30 september 2011    211 31 — — 242
accumulated amortisation     
at 1 october 2010    72 26 — — 98
amortisation in year    31 03 — — 34
disposals    — — — — —
at 30 september 2011    103 29 — — 132
net carrying amount at 30 september 2011     108 02 — — 110
cost     
at 1 october 2009    134 29 03 — 166
additions – internal development    13 — — — 13
additions – purchased externally    — 03 — — 03
disposals    — — 03 — 03
at 30 september 2010    147 32 — — 179
accumulated amortisation     
at 1 october 2009    51 22 03 — 76
amortisation in year    21 04 — — 25
impairment loss    — — 03 — 03
at 30 september 2010    72 26 — — 98
net carrying amount at 30 september 2010    75 06 — — 81
on 13 december 2010 the group acquired 100 of the share capital of opto global holdings pty limited for 143m at that date the fair value of the net assets and 
liabilities in opto global equaled 38m and consequently there is goodwill of 105m the group therefore has goodwill on its balance sheet at the reporting date for 
first time and so is required to test that goodwill for impairment
the goodwill acquired through business combination has been allocated to the groups of cashgenerating units that are expected to benefit from the synergies of the 
acquisition optos has defined two cashgenerating units which are equivalent to the two operating segments north america and the rest of the world the goodwill 
has been allocated 3m to north america and 75m to the rest of the world based on the expected benefits that will arise from the acquisition
0optsar11backjennyshindd   32 17012012   110542 optos plc annual report and accounts 2011 84
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
11 intangible assets continued
for the purpose of impairment testing goodwill is reviewed at the operating segment level in assessing whether goodwill has been impaired the carrying value 
of the operating segment including goodwill is compared with the recoverable amount of the operating segment the recoverable amount is based on value in use 
using discounted riskadjusted projections of the group’s pretax cash flows based on the future projections in line with the overall strategy the projection is based 
on forward plans for the next five years with a perpetual 1 increase for future years on the basis the business expects to continue to trade these projections are 
approved by senior management
for each operating segment we use an appropriate discount rate reflecting those risks and tax effects in arriving at the appropriate discount rate for each group 
of cash flows we adjust the group’s posttax weighted average cost of capital of 8 to reflect the impact of relevant risks the time value of money and tax effects 
the weighted average pretax discount rate used was between 11 and 12 
as a further check we compare our market capitalisation to the book value of our net assets and this indicates significant surplus at 30 september 2011
no goodwill impairment was identified
the group has also performed sensitivity analysis calculations on the projections the directors have concluded that given the significant headroom that exists and 
the results of the sensitivity analysis performed there is no significant risk that reasonable changes in any key assumptions would cause the carrying value of goodwill 
to exceed its value in use
12 investments in subsidiaries
        longterm 
       shares in  loans  
       subsidiary to subsidiary  
       undertakings undertakings total 
company      m  m m
cost
at 1 october 2009      —  14  14 
at 30 september 2010      — 14  14 
at 30 september 2011      143 14 157
during the year to 30 september 2011 the company acquired the shares of opto global holdings pty ltd for 143m details of the investments in which the group 
and the company holds and the percentage of ownership of the nominal value of any class of share capital are as follows
         country of   
name of company       registration proportion
optos inc       usa  100
optos canada inc       canada  100
optos gmbh       germany  100
optos australia formerly opto global holdings pty limited       australia 100
optos kk       japan 100
0optsar11backjennyshindd   33 17012012   110542 optos plc annual report and accounts 2011 85
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13 finance lease receivables
      group  company
      2011 2010 2011 2010 
      m m m m
amounts receivable    
within one year     78 21 07 01
later than one year and not later than five years     205 60 18 03
later than five years     05 04 — —
      288 85 25 04
less finance income allocated to future periods     30 12 03 01
present value of minimum lease payments     258 73 22 03
within one year     66 20 06 01
later than one year and not later than five years     188 50 16 02
later than five years     04 03 — —
      258 73 22 03
included within    
noncurrent assets     192 53 16 02
current assets     66 20 06 01
      258 73 22 03
during the year the group recognised finance lease agreements with customers totalling 198m variable rentals from finance leases amounted to 08m the average 
effective interest rate in relation to finance leases is 59 company 7
all finance lease receivables are considered to be recoverable and therefore no provision for impairment is required the fair value of finance lease receivables is 
considered not to be materially different to the carrying value in the balance sheet
14 inventories
      group  company
      2011 2010 2011 2010 
      m m m m
raw materials spares and consumables     169 47 67 32
work in progress     12 11 12 11
medical devices for sale     65 — 19 —
      246 58 98 43
inventory valued at 18m 2010 05m has been written off in the normal course of business as it was not deemed to be economical to repair or became obsolete
0optsar11backjennyshindd   34 17012012   110542 optos plc annual report and accounts 2011 86
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
15 trade and other receivables
      group  company
      2011 2010 2011 2010 
      m m m m
trade debtors     198 103 24 16
allowance for doubtful debts     08 06 01 —
      190 97 23 16
amounts due from group undertakings     — — 761 440
income tax     01 — 01 01
value—added tax recoverable     — 03 — 02
prepayments     58 36 14 04
other receivables     02 05 — —
      251 141 799 463
trade receivables generally have payment terms of 30–90 days
      group  company
      2011 2010 2011 2010 
analysis of trade receivables     m m m m
neither impaired nor past due     160 87 16 10
past due not impaired     30 10 07 06
impaired     08 06 01 —
      198 103 24 16
the group is exposed to credit risk over a large number of customers and there is no significant concentration of risk credit worthiness checks are undertaken before 
entering into contracts with new customers 
      group  company
      2011 2010 2011 2010 
ageing of past due but not impaired trade receivables     m m m m
up to one month     19 08 04 06
between one and two months     04 01 01 —
more than two months     07 01 02 —
      30 10 07 06
0optsar11backjennyshindd   35 17012012   110542 optos plc annual report and accounts 2011 87
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15 trade and other receivables continued
      group  company
      2011 2010 2011 2010 
movement in the allowance for doubtful debts     m m m m
balance at beginning of year     06 10 — 01
impairment losses recognised on receivables     10 01 01 —
amounts written off as uncollectible     05 02 — —
amounts recovered during the year     03 03 — 01
balance at end of year     08 06 01 —
16 cash and cash equivalents
      group  company
      2011 2010 2011 2010 
      m m m m
cash at bank and in hand     93 102 36 68
short—term deposits     09 310 — 264
      102 412 36 332
cash at bank earns interest at floating rates based on daily bank deposit rates
17 financial liabilities
      group  company
      2011 2010 2011 2010 
      m m m m
contingent consideration    
current     08 — 08 —
noncurrent     — — — —
      08 — 08 —
finance lease obligations    
current     212 259 — —
noncurrent     142 364 01 —
      354 623 01 —
0optsar11backjennyshindd   36 17012012   110542 optos plc annual report and accounts 2011 88
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
17 financial liabilities continued
      group  company
      2011 2010 2011 2010 
      m m m m
amounts payable    
within one year     237 325 08 —
between one and two years     111 224 01 —
between two and five years     36 126 — —
      384 675 09 —
less finance charges allocated to future periods     22 52 — —
      362 623 09 —
as at 30 september 2011 36 2010 26 of the finance lease rental agreements were collateralised against debt finance and 39 2010 52 of the operating 
leases rental agreements were collateralised against debt finance
the weighted average outstanding lease term is 158 months 2010 234 months the weighted average effective borrowing rate for 2011 was 62 2010 67 
all leases are on a fixed repayment term and no arrangements have been entered into for contingent rental payments
18 provisions
      group  company
      2011 2010 2011 2010 
      m m m m
at 1 october     01 01 01 01
provided in the year     03 — 02 —
at 30 september     04 01 03 01
current     02 — 01 —
noncurrent     02 01 02 01
social security contributions on share options included in provisions
social security contributions on share options are considered to fall within the scope of ifrs 2 and are measured as though a cashsettled option under ifrs 2 
the provision is calculated based on the options outstanding at the balance sheet date that are expected to be exercised and relate to the expired portion of the 
vesting period and using the fair value of the options at the balance sheet date it is expected that the costs will be incurred during the exercise period to may 2020
0optsar11backjennyshindd   37 17012012   110543 optos plc annual report and accounts 2011 89
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19 government grants
      group  company
      2011 2010 2011 2010 
      m m m m
at 1 october     05 08 05 08
released to the income statement     02 03 02 03
at 30 september     03 05 03 05
current     02 02 02 02
noncurrent     01 03 01 03
      03 05 03 05
the company received a surplus grant from the scottish executive in 2005 to develop an advanced retinal medical device for ophthalmologists the grant is being 
amortised over the benefits anticipated to accrue from the first five years of operation of the common technology platform the grant will be fully amortised by 
30 september 2012 in 2005 the company was awarded a regional selective assistance grant from the scottish executive and received the final instalment in 2007 
the grant was to enable the company to lease additional premises create additional jobs and safeguard existing jobs this grant is being amortised over the remaining 
term of the property lease and will be fully amortised by 30 september 2014 
20 trade and other payables
      group  company
      2011 2010 2011 2010 
      m m m m
trade payables     67 26 50 23
amounts due to group undertakings     — — 120 65
other taxes and social security costs     10 08 — 03
other payables     — 01 — 01
deferred income     87 15 02 —
accruals     103 72 41 24
      267 122 213 116
optos’ policy for the year ended 30 september 2011 for all suppliers was to fix terms of payment when agreeing the terms of the credit account to ensure that the 
supplier was aware of the terms and to abide by the agreed terms of payment trade payables are typically paid twice monthly with terms equivalent to an average 
of 35 days
other payables are noninterest bearing and have an average term of between 30 and 60 days
deferred income represents prepaid service contracts and other items where delivery of the underlying product or service has yet to be delivered
0optsar11backjennyshindd   38 17012012   110543 optos plc annual report and accounts 2011 90
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
21 operating lease commitments – minimum lease payments
at 30 september 2011 the group had commitments under noncancellable operating leases as follows
      group  company
      2011 2010 2011 2010 
land and buildings     m m m m
within one year     10 08 02 02
in the second to the fifth year     32 27 08 09
after the fifth year     11 16 04 06
      53 51 14 17
the group entered into five commercial leases on property commencing august 1999 december 2005 may 2006 october 2007 and june 2010 the lease entered 
into on 12 august 1999 is for a period of twenty years the december 2005 lease for ten years the may 2006 lease for five years the october 2007 lease for 
ten years and the june 2010 lease for three years there are no renewal options or escalation costs included within the contracts there are no restrictions placed 
upon the lessee by entering into these leases the may 2006 lease has been renewed until may 2014
22 business combinations
on 13 december 2010 the group acquired 100 of the share capital of opto global holdings pty limited for 143m at that date the fair value of the net assets 
and liabilities in opto global equalled 38m and consequently there is goodwill of 105m
opto global holdings pty limited has headquarters in australia the company sources and sells precision optometric and ophthalmic equipment with markets 
primarily in the middle and far east as well as africa and south america the acquisition enhances the optos product range as well as offering the opportunity 
to launch the sale of optos products through key opto global distributors
the acquired business contributed revenues of 38m and a net loss before taxation of 17m to the group for the period from 13 december 2010 to 30 september 2011 
this included one off retention payments to opto global employees of 05m and a charge of 06m for amortisation of the intangible assets acquired with the business 
if the acquisition had occurred on 1 october 2010 group revenue would have been 1440m and profit before taxation would have been 206m this includes 
additional foreign exchange losses of 05m and amounts written off in relation to trademarks of 05m and inventory of 03m prior to acquisition but after 
1 october 2010 these amounts have been calculated using the group’s accounting policies costs of 11m directly attributable to the acquisition have been 
expensed in the income statement and included within exceptional items
details of net assets acquired and goodwill are as follows
purchase consideration         m
cash paid         108
fair value of shares issued 434487 shares at 222        10
fair value of contingent cash         25
total purchase consideration         143
the goodwill is attributable to the acquired customer base synergies and economies expected from the acquisition of opto global holdings pty limited
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22 business combinations continued
as part of the sales and purchase agreement a contingent consideration up to a maximum of 3m is due to the previous owners of opto global in the event that 
the business generates sales of at least 5m over the twelvemonth period to 28 february 2012 from underlying operations and having met that hurdle the business 
generates revenues of up to 9m from synergies the expectation is that the conditions relating to the contingent consideration will no longer be met in full this 
is due to lower than expected sales primarily the result of delays in the integration of the productsdistributors as well as the time taken to obtain regulatory 
approval as a consequence the fair value of contingent consideration has been reassessed as 08m compared to 25m at the acquisition date
the fair value of the shares issued was based on the published share price on 13 december 2010
the assets and liabilities as of 13 december 2010 arising from the acquisition are as follows
        book value fair value 
        m m
supplier relationships       — 40
distributor relationships       — 14
licences       — 06
cash and cash equivalents       01 01
inventories       05 05
trade and other receivables       06 06
trade and other payables       16 16
deferred tax liability       — 18
net assets       04 38
goodwill arising on acquisition        105
purchase consideration        143
purchase consideration settled in cash        108
cash and cash equivalents in subsidiary acquired        01
cash outflow on acquisition        107
there were no acquisitions in the year ended 30 september 2010
0optsar11backjennyshindd   40 17012012   110543 optos plc annual report and accounts 2011 92
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
23 capital commitments
in the normal course of business of agreeing contractual relationships with customers the group is committed to incurring around 13m of costs in the year to 
30 september 2011 2010 12m these costs will enhance the value of the device and will be capitalised into property plant and equipment when incurred 
24 called up share capital
        2011 2010 
        number number 
equity share capital       million million
authorised share capital
ordinary shares of 2p each       90 90
the company has one class of ordinary share which carries no rights to fixed income
        2011 2010
at 1 october ordinary shares of 2p each       70557475 69539975
issued on acquisition of subsidiary       434487 —
exercise of employee share options       271964 1017500
at 30 september ordinary shares of 2p each       71263926 70557475
      share  share share  share 
      capital premium  capital premium 
      2011  2011 2010  2010 
consideration received on issue of shares     m m m m
issue of ordinary share capital for acquisition     — 10 — —
exercise of employee share options     — 05 — 15
total     — 15 — 15
consideration received     — 05 — 15
0optsar11backjennyshindd   41 17012012   110543 optos plc annual report and accounts 2011 93
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25 sharebased payments
the company has operated discretionary share option arrangements both pre and post its admission to the main market of the london stock exchange in february 2006 “ipo”
option movements during year
the charge recognised from equitysettled sharebased payment transactions for employee services received during the year ended 30 september 2011 is 09m 
2010 05m with an additional charge of 03m 2010 01m in respect of national insurance
option terms
preipo discretionary options that remain outstanding vested over the three years commencing on the date on which the option was granted one third of the options 
vested on grant and the remaining twothirds vested over the following 36 months on a monthly basis
a further vesting arrangement was utilised in respect of two separate grants the first grant is subject to timebased vesting with onethird of the option vesting on 
the first second and third anniversaries of the date of grant
all preipo option agreements contain provisions for the full acceleration of the option on a change in the control of the company option holders who cease to be 
employees of the group are entitled to exercise their vested options in full for a period of either one month or six months following cessation of employment 
depending on the reasons for that cessation
all option agreements contain provisions enabling the adjustment of the number of shares subject to option and the exercise price in the event of capitalisation issue 
subdivision or consolidation of ordinary shares all options are to be settled by way of equity with a maximum term of ten years from the date of grant
postipo three new share plans were introduced details of these plans are as follows
the optos performance share plan 2007
a performance share plan supervised by the remuneration committee which grants awards of conditional shares a nil or nominal cost option with a short exercise 
period or as forfeitable shares awards will normally vest on the third anniversary of grant other than in exceptional circumstances to the extent that applicable 
performance conditions have been met all awards are subject to performance conditions set by the committee and measured over a single threeyear period 
awards are required to be exercised with six months of vesting all awards normally lapse upon leaving employment however under certain circumstances such 
as death disability illness or the sale or transfer of a participant’s employing company then the award will normally vest subject to satisfaction of performance 
conditions and a pro rata basis for time between the grant and end of threeyear period as determined by the remuneration committee in the event of a takeover 
or scheme of arrangement of winding up of the company all awards will vest early to the extent that the performance conditions have or would have in the 
opinion of the remuneration committee been satisfied awards will then be subject to pro rata for time between the grant and threeyear period as determined 
by the remuneration committee unless it decides it is inappropriate to do so in the circumstances
0optsar11backjennyshindd   42 17012012   110543 optos plc annual report and accounts 2011 94
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
25 sharebased payments continued
option terms continued
the optos share option plan 2007
an option plan supervised by the remuneration committee structured to comprise elements approved by hm revenue and customs so as to provide uk tax qualified 
options as well as elements not so approved the plan also provides us employees with incentive stock options so as to achieve tax efficiencies in the us grants 
awards are made at an exercise price which is not less than the market value of the company’s ordinary shares on or around the time of grant awards will normally 
vest of the third anniversary of grant other than in exceptional circumstances to the extent that applicable performance conditions have been met any award can 
be subject to performance conditions set by the committee and measured over a single threeyear period
awards are required to be exercised within ten years of grant all awards normally lapse upon leaving employment however under certain circumstances such 
as death disability illness or the sale or transfer of a participant’s employing company then the award will normally vest subject to satisfaction of performance 
conditions where appropriate and a pro rata basis for time between the grant and end of threeyear period as determined by the remuneration committee in 
the event of a takeover or scheme of arrangement of winding up of the company all awards will vest early to the extent that the performance conditions where 
appropriate have or would have in the opinion of the remuneration committee been satisfied awards will then be subject to pro rata for time between the grant 
and three year period as determined by the remuneration committee unless it decides it is inappropriate to do so in the circumstances
the following table illustrates the number and weighted average exercise prices “waep” of and movements in share options during the year ended 30 september 2011
      2011 2011 2010 2010 
      number waep number waep
outstanding at the beginning of the year
1
     3663271 £061 3720400 £086
granted during the year     1492826 £043 1264000 £030
forfeited during the year     654259 £116 303629 £117
exercised during the year     271964 £095 1017500 £098
outstanding at the end of the year
1
     4229874 £066 3663271 £061
exercisable at the end of the year     664899 £123 1006900 £127
1  included within this balance are options over 68350 2010 145050 2p shares that have not been recognised in accordance with ifrs 2 as the options were granted on or before 
7 november 2002 these options have not been subsequently modified and therefore do not need to be accounted for in accordance with ifrs 2 the weighted average share price 
during the year was £163 2010 £103
0optsar11backjennyshindd   43 17012012   110543 optos plc annual report and accounts 2011 95
overview
business review
governance
financial statements
25 sharebased payments continued
option terms continued
the optos share option plan 2007 continued
share options outstanding at the end of the period have the following exercise prices
       price 2011 2010 
expiry dates       per share number number
options issued preflotation   
october 2011      £080 16250 51750
june 2012 – november 2012      £100  29750 29750
january 2013 – december 2013      £100  13500 114000
february 2014 – december 2014      £100 53288 61788
january 2015 – december 2015      £100  263875 407375
january 2016      £100  3000 6000
june 2016      £207 32500 32500
performance share plan 2007   
january 2018      £124  12765 66148
march 2019      £002  765000 765000
december 2019      £002 580000 580000
may 2020      £129 55000 55000
november 2020      £002 893028 —
share option plan 2007   
may 2017      £248 48741 240186
january 2018      £124 168879 401724
january 2019      £076 140000 164500
december 2019      £002 582500 624000
november 2020      £105 320000 —
saye 2014      £103 251798 —
outstanding at the end of the year       4229874 3663271
1 5000 options were issued and forfeited during the year ended 30 september 2010
2 28000 options were issued and forfeited during the year ended 30 september 2011
0optsar11backjennyshindd   44 17012012   110543 optos plc annual report and accounts 2011 96
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
25 sharebased payments continued
the fair value of equitysettled share options granted is estimated as at the date of grant using the blackscholes formula taking into account the terms and conditions 
upon which the options were granted the following table lists the inputs to the model used for the years ended 30 september 2011 and 30 september 2010
option terms continued
the optos share option plan 2007 continued
     2011   2010
    nov 2010 nov 2010 may 2010 may 2010 dec 2009 dec 2009 
   nov 2010 performance share performance share performance share 
   sharesave share option share  option  share  option  
   plan plan plan plan plan  plan plan 
dividend yield   — — — — — — —
expected volatility   54 54 46 50 46 50 46
historical volatility   54 54 46 50 46 50 46
riskfree interest rate   136 130 210 150 240 180 270
expected life of option years  3 3 5 3 5 3 5
weighted average share price  £127 £127 £124 £127 £127 £095 £095
weighted average fair value of options granted  £068 £122 £059 £125 £054 £093 £042
exercise price  £103 £002 £105 £002 £129 £002 £092
the expected life of the options is based on historical data and is not necessarily indicative of exercise patterns that may occur the expected volatility reflects 
the assumption that the historical volatility is indicative of future trends which may also not necessarily be the actual outcome as the company has only a limited 
history of quoted share price volatility the expected volatility has been based on the historical volatility of comparative companies no other features of options 
granted were incorporated into the measurement of fair value 
0optsar11backjennyshindd   45 17012012   110544 optos plc annual report and accounts 2011 97
overview
business review
governance
financial statements
26 related party transactions
group
during the year ended 30 september 2011 revenue totalling 46000 2010 nil at normal market prices was received by group companies from kehoe eye care pc 
of which peter kehoe is a director and controlling shareholder there was 4000 outstanding at 30 september 2011 but within terms of trade 2010 nil no guarantees 
have been given or received no provisions have been made for doubtful debts in respect of the amounts owed by related parties
compensation of key management personnel
        2011 2010 
        m m
shortterm employee benefits       33 26
postemployment benefits       02 01
sharebased payments       07 03
        42 30
there were eleven 2010 nine key management personnel in 2011
company
transactions with subsidiary companies
        2011 2010 
       note m m
sales to subsidiary companies       160 55
purchases from subsidiary companies       139 54
amounts due from subsidiary companies       761 440
amounts due to subsidiary companies       122 65
longterm loans to subsidiary companies      5 14 14
no guarantees have been given or received no provisions have been made for doubtful debts in respect of the amounts owed by related parties
compensation of key management personnel
        2011 2010 
        m m
shortterm employee benefits       21 14
postemployment benefits       01 01
sharebased payments       06 02
        28 17
there were six 2010 six key management personnel in 2011
0optsar11backjennyshindd   46 17012012   110544 optos plc annual report and accounts 2011 98
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
27 financial instruments disclosures
the group’s principal financial instruments comprise cash and finance leases
the main purpose of these financial instruments is to manage the group’s funding and liquidity requirements the group has other financial instruments such as trade 
receivables and trade payables which arise directly from its operations the principal financial risks to which the group is exposed are those relating to foreign currency 
credit liquidity and interest rate
foreign currency risk
the group has invested in overseas operations and also buys and sells goods and services in currencies other than in the functional currency of its relevant 
operations as a result the group’s nonus dollar revenues profits assets liabilities and cash flows can be affected by movements in exchange rates
the following table demonstrates the sensitivity to a reasonably possible change in the sterling against the us dollar and the euro against the us dollar exchange 
rates with all other variables held constant of the group’s profit before tax due to fair value of monetary assets and liabilities an increase in currency rate is defined 
as a strengthening of sterling and euro versus the us dollar
      group and company
       effect  effect 
      increase in  on profit decrease in  on profit 
      currency rate m currency rate m
2011    
sterling versus us dollar     10 43 –10 43
euro versus us dollar     10 02 –10 02
2010    
sterling versus us dollar     10 24 –10 24
euro versus us dollar     10 — –10 —
the group monitors its nonus dollar foreign currency exposure and when deemed necessary by the board seeks to minimise its transaction exposure by using 
forward foreign currency contracts to eliminate exposures on any committed significant transactions the board has determined that it was not necessary to use 
forward foreign currency contracts in 2011 it is group policy not to engage in any speculative forward exchange transactions of any kind the group does not 
currently hedge currency exposure in its net investment on overseas operations 
credit risk
the credit risk on liquid funds is limited because the funds are deposited over a number of counterparties who are banks with a mix of high quality balance sheets high 
credit ratings assigned by international credit rating agencies or strong governmental support the group’s credit risk is primarily attributable to its trade receivables
the group is exposed to risk over a large number of customers and there is no significant concentration of risk creditworthiness checks are undertaken before entering 
into contracts with new customers the amounts presented in the balance sheet are net of allowance for doubtful receivables an allowance for impairment is made 
where there is an identifiable loss event which based on previous experience is evidence of a reduction in the recoverability of cash flows
0optsar11backjennyshindd   47 17012012   110544 optos plc annual report and accounts 2011 99
overview
business review
governance
financial statements
27 financial instruments disclosures continued
credit risk continued
trade receivables are denominated in the following currencies
      group  company
      2011 2010 2011 2010 
      m m m m
us dollar     147 76 07 05
sterling     08 08 08 06
canadian dollar     19 10 — —
euro     15 06 06 02
other currencies     09 03 03 03
      198 103 24 16
fair values of financial assets and financial liabilities
set out below is a comparison by category of carrying amounts and fair values of all of the group’s financial instruments
      carrying  fair carrying  fair 
      amount value amount value 
      2011 2011 2010  2010 
group     m  m m  m
financial assets    
cash     102 102 412 412
finance lease receivables     258 226 73 73
financial liabilities    
obligations under finance leases     354 354 623 603
      carrying  fair carrying  fair 
      amount value amount value 
      2011 2011 2010  2010 
company     m  m m  m
financial assets    
cash     36 36 332 332
finance lease receivables     22 19 03 03
financial liabilities    
obligations under finance leases     01 01 — —
the fair value of items has been calculated by discounting the expected future cash flows at prevailing interest rates the carrying amounts of all other financial 
instruments of the group ie shortterm trade receivables and payables that are not included in the above table are a reasonable approximation of fair value 
the carrying amount recorded in the balance sheet of each financial asset represents the group’s maximum exposure to credit risk
the average length remaining on the finance lease obligations has reduced to 16 months it has therefore been deemed that the carrying value is in line with the fair value
the weighted average effective interest rate on cash balances for 2011 was 01 2010 01
0optsar11backjennyshindd   48 17012012   110544 optos plc annual report and accounts 2011 100
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
27 financial instruments disclosures continued
interest rate risk
interest on financial instruments classified as fixed rate is fixed until the maturity of the instrument interest on financial instruments classified as floating rate is 
repriced at intervals of less than one year the other financial instruments of the group that are not included in the above tables are noninterest bearing and are 
therefore not subject to interest rate risk
all of the group’s borrowings are at fixed rates of interest excess cash is placed on shortterm interestbearing deposit accounts
based on current levels of net debt interest rate risk is not considered to be material 
the following table demonstrates the sensitivity to a reasonably possible change in interest rates with all other variables held constant of the group’s profit before 
tax through the impact on floating rate deposits there is no impact on the group’s equity
        increase effect on 
        decrease profit 
        in basis before tax 
group       points m
2011  
us dollar       50 —
2010  
us dollar       50 02
        increase effect on 
        decrease profit 
        in basis before tax 
company       points m
2011  
us dollar       50 —
2010  
us dollar       50 01
liquidity risk
the group aims to mitigate its liquidity risk by managing its cash resources and improving its credit rating to facilitate effective fund raising the group’s funding 
objective is to maintain continuity of funding and flexibility through the use of internally generated funds and finance leases which it uses to fund the expansion 
of its business operations during the year ended 30 september 2011 the group continued to have access to sufficient funds to meet its business expansion needs 
excess cash is placed on shortterm interestbearing deposit accounts
0optsar11backjennyshindd   49 17012012   110544 optos plc annual report and accounts 2011 101
overview
business review
governance
financial statements
27 financial instruments disclosures continued
liquidity risk continued
the table below summarises the maturity profile of the group’s financial liabilities at 30 september 2011 based on contractual undiscounted payments
      within 1–2 2–5  
      1 year years  years total 
group      m  m  m  m
2011 
fixed rate    
obligations under finance leases     229 111 36 376
floating rate    
trade and other payables excluding other taxes and social security costs     257 — — 257
      within 1–2 2–5  
      1 year years  years total 
group      m  m  m  m
2010
fixed rate    
obligations under finance leases     325 224 126 675
floating rate    
trade and other payables excluding other taxes and social security costs     114 — — 114
      within 1–2 2–5  
      1 year years  years total 
company      m  m  m  m
2011     
fixed rate    
obligations under finance leases     — 01 — 01
floating rate    
trade and other payables excluding other taxes and social security costs     93 — — 93
      within 1–2 2–5  
      1 year years  years total 
company      m  m  m  
2010    
fixed rate    
obligations under finance leases     — — — —
floating rate    
trade and other payables excluding other taxes and social security costs     113 — — 113
0optsar11backjennyshindd   50 17012012   110544 optos plc annual report and accounts 2011 102
financial statements
notes to the consolidated financial statements continued
for the year ended 30 september 2011
27 financial instruments disclosures continued
capital management
the primary objective of the group’s capital management is to ensure that it maintains access to sufficient capital to continue to grow its business the group’s capital 
comprises equity attributable to equity holders vendor financing and bank shortterm deposits the group’s principal business model of placing medical devices with 
customers on a rental basis requires it to access capital to fund purchases of new medical devices which are included as property plant and equipment on the group’s 
balance sheet the group has however also increased the proportion of direct capital sales made to customers
in addition to debt finance the group maintains cash at bank and on shortterm deposits where it seeks to optimise the rates of interest received cash deposits 
are managed in parallel with levels of debt financing in order to provide sufficient levels of liquidity to settle its ongoing requirements for creditor payments 
the group tracks and manages its levels of net debt no changes were made in the objectives policies or processes during the years ended 30 september 2010 
and 30 september 2011
        2011 2010 
        m m
net debt  
cash       102 412
obligations under finance leases       354 623
net debt       252 211
the group entered into a facility agreement with lloyds bank corporate markets in respect of the provision of bilateral multicurrency revolving credit facilities of up 
to us30 million this facility is to be used to fund the acquisition of opko instrumentation division and for general working capital purposes as at the year end this 
facility had not been enacted 
0optsar11backjennyshindd   51 17012012   110544 optos plc annual report and accounts 2011 103
overview
business review
governance
financial statements
28 postbalance sheet event
on 11 october 2011 the group announced that following the approval of the transaction by its shareholders and satisfaction of all outstanding conditions the 
acquisition of the assets and business of the instrumentation division of opko health inc completed 
opko instrumentation is engaged in the development manufacture and sale of optical coherence tomography “oct” diagnostic devices and optical ultrasound scanners 
each used by the ophthalmic profession in the diagnosis and management of eye disease and conditions optos’ widefield retinal imaging technology combined with 
the specific data that can be derived from oct images has the potential to offer ophthalmologists and optometrists the most powerful tools for disease diagnosis and 
management and strengthens optos’ offering into optometry the acquisition brings access to established oct and ultrasound products together with a product pipeline 
including a lowercost oct product significant opportunities exist to accelerate sales through optos’ direct sales force and to derive selling marketing and operational 
synergies from combining optos’ business with opko instrumentation
the consideration for the purchase included an initial cash consideration of us175 million together with payment of royalties at a rate of 25 or 5 on sales 
of certain products from the second anniversary of the date of completion the maximum payment of royalties is set at an aggregate amount of us225 million 
the group has entered into an agreement with lloyds bank corporate markets in respect of the provision of bilateral multicurrency revolving credit facilities of up to 
us30 million the company has funded the acquisition and associated expenses from cash reserves and amounts drawn down under the above agreement
due to the proximity of the transaction to the reporting date additional disclosure information such as the valuation of intangibles and fair value adjustments cannot 
be given at this time as the purchase price allocation exercise is still underway and will not be completed by the reporting date
0optsar11backjennyshindd   52 17012012   110544 optos plc annual report and accounts 2011 104
     2011 2010 2009 2008 2007 
     m m m m  m
revenue    1433 1063 972 1008 868
gross profit    914 709 590 642 565
operating expenses    663 534 505 525 500
exceptional items    01 — 63 — —
operating profit    252 175 22 117 65
profitloss before taxation    228 127 38 59 16
profitloss after taxation    241 140 43 46 02
diluted profitloss before taxation per ordinary share    307c 181c 55c 84c 23c
diluted profitloss after taxation per ordinary share    318c 199c 61c 66c 03c
cash flow from operating activities    365 464 374 395 315
free cash flow    14 277 180 33 108
net debt    252 211 462 584 570
financial statements
five year summary
0optsar11backjennyshindd   53 17012012   110545 optos plc’s commitment to environmental issues is reflected in this annual report 
and accounts which has been printed on satimatt green 75 recycled fibre and 25 
fsc® certified fibre cocoon offset comprising 100 recycled fibre and symbol freelife 
certified by the fsc® and produced at mills with iso 14001 environmental management 
systems this report was printed by pureprint group using their environmental print 
technology which minimises the impact of printing on the environment vegetable 
based inks have been used and 99 of dry waste is diverted from landfill the printer 
is a carbonneutral® company
2optsar11coverjennyogindd   6 17012012   110753 europe
optos plc
queensferry house 
carnegie business campus 
enterprise way 
dunfermline 
scotland ky11 8gr 
united kingdom
44 0 1383 843 300
optos gmbh
gebäude 5137c 
wernervonsiemensstr 2–6 
d–76646 bruchsal
49 0 7251 92940 
49 0 800 18 22 643
switzerland
optos switzerland
zweigniederlassung egg 
gewerbestrasse 9 
8132 egg
41 0 43 277 07 37
north america
optos inc
67 forest street 
marlborough ma 01752 
united states
tollfree 
1 800 854 3039
outside of the us 
1 508 787 1400
australia
optos australia
adelaide university research park 
38 winwood street 
thebarton adelaide 
south australia 5031
61 8 8443 4533
wwwoptoscom
optos plc annual report and accounts 2011
2optsar11coverjennyogindd   1 17012012   110753


Summary:
 optos plc annual report and accounts 2011 08
overview
business review
governance
financial statements
business review
chief executive’s review
accelerating 
growth in our 
core business
in brief
•  we delivered a significant 
increase in both revenues 
and profits
•   we expanded into several 
new markets
•   we developed a growing body of 
clinical evidence that demonstrates 
the critical importance of 
retinal diagnostics
•   we made strong progress 
towards becoming the leading 
retinal diagnostics company
overview
the strong growth in our revenues increasing 
35 from 1063m in 2010 to 1433m this year 
reflects the successful implementation of a number 
of key strategic changes during the past year 
new business models 
our customers have responded well to the 
alternative business models we now offer many 
are still happy to work with our payperpatient 
rental model but we are seeing an increasing 
trend towards the new alternatives such as 
fixed rental contracts renttoown or outright 
purchases of the devices we believe this 
contributed to the low levels of customers 
choosing to deinstall their devices with only 
around 5 of our customers returning their 
products at the end of the contract term 
compared to 10 the previous year
improved core products 
at the beginning of this year our sales team 
focused only on selling our core ultrawidefield 
imaging devices to a customer base focused 
largely on optometry we armed our teams with an 
improvement to our base p200 device the 200dx 
many customers chose to acquire the 200dx 
upgrade which offers improved image quality 
either on a new contract through purchase or upon 
renewing their existing contracts others chose 
the p200 which was priced more competitively 
we also acquired additional products initially 
through a distribution deal with accutome then 
through the purchase in december 2010 of the 
australian company opto global pty holdings ltd 
and further through our inhouse development 
of the image management and archiving product 
optosadvance this range of products gave 
the sales team the opportunity to attract new 
customers and retain existing contacts
expanding into ophthalmology  
our p200c devices remain popular with clinical 
optometrists and general ophthalmologists 
particularly in the canadian and german markets 
additionally optos chose to focus significant 
efforts on the ophthalmologist and retinal 
 “  we have expanded into 
several new markets 
whilst building our 
product portfolio both 
through acquisition and 
organic development”
roy davis  
chief executive officer
4optsar11frontjennylesleyshindd   8 17012012   110630 optos plc annual report and accounts 2011 09
overview
business review
governance
financial statements
specialist sectors with the launch and promotion 
of the 200tx device promoted solely to those 
customers a specialist sixperson sales team 
was established to lead the sales efforts into 
this marketplace in north america supported 
by the broader sales team 
the clinical information delivered by the images 
from these devices including our standard 
optomap® images derived using red and green 
lasers together with fluorescein angiography 
images using blue laser technology disclosing 
information about the vasculature of the retina 
and autofluorescence delivering information 
about the metabolic state of the retinal cells 
and their health all in the widefield is attracting 
significant medical interest we are pleased to 
have placed over 140 of the 200tx devices 
the additional opto global products used by 
ophthalmologists including treatment lasers 
and surgical microscopes are helping to 
establish optos in the ophthalmology sector
geographic expansion  
we took significant steps towards expanding 
our geographic reach sales representatives 
were recruited in new territories in europe 
including austria and the netherlands and the 
sales teams strengthened in our other direct 
markets being germany uk switzerland 
sweden norway and spain our european 
presence was further strengthened through the 
appointment of distributors and dealers in italy 
and poland opto global brought us an extensive 
international distributor network including in 
europe middle east and africa it also brought 
us a direct footprint in australia a market for 
which we see great potential the 200tx product 
also brought us our first sales in the important 
japanese market where we appointed a 
strong distributor 
expanding our product range  
in october 2011 we completed the acquisition of 
the business and assets of opko instrumentation 
bringing access to established oct and ultrasound 
products together with a product pipeline including 
a lowercost oct product falcon nearing market 
launch we are excited by this acquisition as 
we believe that optos’ widefield retinal imaging 
technology combined with the specific data that 
can be derived from oct images has the potential 
to offer eyecare professionals the most powerful 
tools for disease diagnosis and management 
we were also proud to deliver our leading 
development project daytona on schedule 
this project conceived two years ago set out to 
deliver a desktop sized version of our widefield 
slo scanning device our objective was to create 
a product that would deliver images of a quality 
as high as the p200c device would capture the 
same widefield view of the retina would be robust 
manufacturable in volume with autofluorescence 
imaging run from new intuitive software and would 
offer a device that could be used by customers 
globally regardless of practice size or physical 
or climatic environment we unveiled daytona as 
planned in october and are set to ship product to 
customers before the end of the first half of 2012
research and development  
our rd activities are driven from scotland 
and our team is now some 45 strong including 
the software and hardware engineers who 
joined with oct business just after the year end 
significant projects delivered this year include 
daytona and optosadvance
in 2011 we gained additional patent protection 
for our core widefield imaging technology 
extending the slo core patent claims through 
2027 the focus in 2012 is to deliver daytona 
at volume add additional imaging modalities to 
our 200tx device and deliver the next generation 
falcon oct devices ensuring full integration of 
the recently acquired assets and devices 
our sales team is now over 90 strong with 
clinical experts supporting and training all 
representatives to allow them to deliver 
excellent support to clinicians 
          benefits
visibility  
of future  
income
business 
models
pay‑ per‑ patient                      flexible leases
income visibility 
plus the upside  
of variable  
optomap
®
  
charges
                     outright purchase                     
summary and outlook
during the last financial year we have delivered 
a significant increase in both revenues and 
profits whilst making important investments in 
the longterm growth of the business we have 
expanded into several new markets whilst building 
our product portfolio both through acquisition and 
organic development at the same time we have 
developed a growing body of clinical evidence that 
demonstrates the critical importance of retinal 
diagnostics overall we are pleased with our 
progress towards becoming the leading retinal 
diagnostics company and are increasingly confident 
about optos’ longterm growth prospects
roy davis
chief executive officer
21 november 2011
 
improved cash flow 
and upside from 
service contracts
 gives customers the choice to fix payments
   but benefit from rental terms
           benefits
 allows customers a lower fixed rental and reducing
 price per optomap with higher patient volumes 
     allows customers choice and means no 
 
             benefits
     additional charges regardless of volume
4optsar11frontjennylesleyshindd   9 17012012   110631