Annual Report 2008

Published 24th March 2009

Highlights

Overview Business review

Financial

• Significant growth in higher margin decontamination products and services sold into the international healthcare and life sciences sectors – which successfully substituted prior year US defence filtration systems’ revenues (Revenues: £34.4 million (2007: £34.1 million))
• Profit before tax: £5.00 million (2007: £4.17 million)
  – increase in pre‑tax profit of 20%
• Basic earnings per share: 9.0p (2007: 8.9p)
  – increase of 1.1%, reflecting an increase in the effective tax rate to 25% (2007: 12%)
• Strong cash flow in the year: net cash from operating activities increased by 73% to £9.0 million (2007: £5.2 million)
• Substantial cash on balance sheet: gross cash of £7.1 million (2007: £3.5 million); net cash of £5.2 million (2007: £2.7 million) – a 93% increase in net cash of £2.5 million.
• Proposed payment of a 2.2p dividend per ordinary share (2007: 2.0p), representing a 10% dividend increase over 2007

Bio-decontamination

• Significant increase in “superbug” decontamination revenues in the healthcare sector, principally relating to service revenues in the UK
• Recent award from the Department of Health and the NHS’ Purchasing and Supply Agency (“PASA”) for the “Innovative new technology offering the greatest contribution in controlling Clostridium diffcile”
• Substantial increase in decontamination equipment revenues – in the UK and internationally – in the life sciences sector
• First full year of revenues from the US Department of Defense’s Joint Materials Decontamination System development contract, which uses BIOQUELL’s unique hydrogen peroxide vapour technology to decontaminate biological and chemical weapons

Trac

• Full consolidation of the specialist testing, regulatory and compliance businesses within the TRaC division
• Business development focus on the aerospace, defence and telecoms markets – with additional outsourcing-related opportunities
• Closure of TRaC’s US telecoms testing facilities in Silicon Valley, California – with transfer of the equipment and know-how to the UK
• Cost reduction programme resulting in headcount reduction and more efficient management structure to help improve TRaC’s profitability

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