CONVATEC LIMITED - Annual Accounts

Form: AA - Annual Accounts

FULL ACCOUNTS MADE UP TO 31/12/09

Filed on: 4 Oct 2010

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CONVATEC LIMITED
DIRECTORS’ REPORT
REPORT AND FINANCIAL STATEMENTS ####
CONTENTS Page
Directors' Report #
Independent Auditors' Report S
Profit and Loss Account #
Statement of Total Recognised Gains and Losses #
Balance Sheet #
Notes the Fmancial Statements ##

CONV ATEC LIMITED
DIRECTORS’ REPORT
The directors present their annual report and the audited financial statements of the Company for the
year ended ## December ####.
PRINCIPAL ACTIVITIES AND BUSINESS REVIEW
The Company’s principal activities are the manufacturing and marketing of colostomy, incontinence,
wound care and skin care products The Company will continue to manufacture colostomy, incontinence,
wound care and skin care products for the medical market and seek ways to improve the current range
of products and increase patient benefit. The principal risk and uncertainty that the business faces IS
increased competition in the sector, and in the future, the Company’s performance will be affected by
the developments in the health care market and government lop#c#es With effect from January # ####,
ConvaTec Ltd ceased to operate from its offices in Estonia, Latvia, and Lithuania.
RESULTS AND DIVIDENDS
Turnover increased by £##,###,### to £###,###,###, being a ##.#% increase over the nor year. The
profit for the year after taxation was £#l,###,### (#### £##,###,###) During ####, the company
made a d#stir#but#on to ConvaTec Holdings UK Limited of £l,###,### (#### £##,###,###) In ####, a
d#stir#but#on was also made to Bristol-Myers Squlbb Holdings #### for the amount of £#,###,###
Further details are provided in notes ## and ##
GOING CONCERN
The Company’s business activities, together with the factors likely to affect its future development,
performance and position are set out in this Directors Report above The company continues to
generate strong profit and cash flows and expects to continue to do so for the foreseeable future.
The company had net current l#an#l#t#es at ## December ####. This position has been reversed during
####
During ####, the parent company took out bank borrowings to partly fund the acquisition of the
ConvaTec group These borrowings are due for repayment in instalments at various dates between
#### and #### The amount of borrowing outstanding at ## December #### was approximately $# #
billion and is subject to the group meeting certain covenants This is secured against the assets of all
companies within the group, including ConvaTec Limited If the group were to default on repayments
#n the future, this could threaten the ability of ConvaTec Limited to continue as a going concept
However management believe the group will generate sufficient operating cash-flows to cover all debt
repayments as they fall due
The directors have a reasonable expectation that the company and the group have adequate resources
to continue in operational existence for the foreseeable future. Thus, they continue to adopt the going
concept basis in preparing the annual report and financial statements
#

CONVATEC LIMITED
DIRECTORS’ REPORT (CONTINUED)
RESEARCH AND DEVELOPMENT
During the period, research and development has been aimed at improving and filling the gaps in our
current product range The Company believes that it will be able to develop and market new products
as a result of its research and development activities in the future
Total expenditure on research and development during the year was £#,###,### gross, £#,###,### after
recharges to other Group undertakings (#### £#,###,### gross, £#,###,### after recharges to other
Group undertakings).
DIRECTORS
The directors who served during the year and to the date of this report are as follows:
M J Lydon
C B Edwards
R Hegmbotham
S J Taylor
A J Thelwell
D Watt (Resigned ##/##/####)
STATEMENT OF DIRECTORS’ RESPONSIBILITIES
The directors are responsible for preparing the Annual Report and the financial statements in
accordance with applicable law and regulations.
Company law requires the directors to prepare financial statements for each financial year. Under that
law the directors have elected to prepare the financial statements in accordance with United Kingdom
Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law)
The financial statements are required by law to give a true and fair view of the state of affairs of the
Company and of the profit or loss of the Company for that period In preparing these financial
statements, the directors are required to
# select suitable accounting policies and then apply them consistently,
# make Judgments and estimates that are reasonable and prudent,
° state whether applicable UK Accounting Standards have been followed, subject to any maternal
departures disclosed and explained in the financial statements, and
# prepare the financial statements on the going concept basis unless it IS inappropriate to presume
that the Company will continue in business
The directors are responsible for keeping proper accounting records that disclose with reasonable
accuracy at any time the financial position of the Company and enable them to ensure that the financial
statements comply with the Companies Act #### 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 regularities
#

CONV ATEC LIIVIITED
DIRECTORS’ REPORT (CONTINUED)
CHARITABLE CONTRIBUTIONS
The Company has donated £##,### (####. £##,###) for charitable purposes during the year These
donations have been made to both local and national organisations whose purposes are compatible
with the principal activities of the Company, namely the manufacturing and marketing of colostomy,
incontinence, wound care and skin care products
AUDITORS
In the case of each of the persons who are directors of the Company at the date when this report was
approved
~ So far as each of the directors is aware, there is no relevant audit information of which the
Company’s auditors are unaware, and
# Each of the directors has taken all the steps that they ought to have taken as a director in order to
make themselves aware of any relevant audit information and to establish that the Company’s
auditors are aware of that information
This confirmation is given and should be interpreted in accordance with the provision of s#l# of the
Companies Act ####
Deloitte LLP have expressed their willingness to continue #n office and accordingly a resolution to
reappoint them will be proposed at the forthcoming Annual General Meeting.
EMPLOYEE POLICIES
Employment of disabled persons
The Company is an equal opportunities employer and gives full and fair consideration to applications
for employment made by disabled persons, having regard to their particular aptitudes and abilities
Where people become disabled dung the course of their employment, every effort is made to retain
their services and to provide retraining, if necessary All employees are eligible for consideration for
appropriate training, career development and promotional opportunities, disabled people are not
treated differently in this respect.
#

CONV ATEC LIMITED
DIRECTORS’ REPORT (CONTINUED)
Employee involvement
The Company attaches importance to the development of employee involvement based on a positive,
open and constructive approach
Consultation on affairs of the business is achieved principally through line management, supplemented
by a Safety Committee and also communication meetings held periodical wit all employees The
aim is to improve the open management style and to continue to encourage employees at all levels to
contribute more fully to the decision making process within the business
CREDITOR PAYMENT POLICY
The Company’s policy is to establish terms of payment with its suppliers when a trading relationship is
established, to ensure that the terms of payment are clear and to abide by the agreed terms, provided
the supplier meets its obligations As at ## December #### the creditor days represented by the
closing creditors balance was ## (#### ##).
By Order of the Board
(>)<#G@es/
S J Taylor
Director ## September ####
GDC First Avenue
Deeside Industrial Park
Deeside
Flintshire CH# #NU
#

CONVATEC LIMITED
INDEPENDANT AUDITORS’ REPORT T# THE MEMBERS OF CONVATEC LIMITED
We have audited the financial statements of Convatec Limited for the year ended ## December ####
which comprise the Profit and Loss Account, the Statement of Total Recognised Gains and Losses, the
Balance Sheet and the related notes # to ##. The financial reporting framework that has been applied in
their preparation IS applicable law and United Kingdom Accounting Standards (United Kingdom
Generally Accepted Accounting Practice)
This report is made solely to the company’s members, as a body, in accordance with Chapter # of Part
## of the Companies Act #### 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 auditors’ 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, 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 the financial statements in accordance with applicable law and
Intemational Standards on Auditing (UK and Ireland) Those standards require us to comply with the
Auditing Practices Board’s (APB’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 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.
Opinion on financial statements
In our opinion the financial statements'
# give a true and fair view of the state of the company’s affairs as at ## December #### and of its
profit for the year then ended,
# have been properly prepared in accordance with United Kingdom Generally Accepted
Accounting Practice, and
# have been prepared in accordance with the requirements of the Companies Act ####.
Opinion on other matter prescribed by the Companies Act ####
In our opinion the information given in the Directors’ Report for the financial year for which the
financial statements are prepared IS consistent with the financial statements
#

CONVATEC LIMITED
INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF CONVATEC LIMITED
(CONTINUED)
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act #### requires
us to report to you if, in our opinion
# adequate accounting records have not been kept, or rectums adequate for our audit have not been
received from branches not visited by us; or
~ the financial statements are not in agreement with the accounting records and rectums, 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
QW gin
Gregory Culshaw (Senior Statutory Auditor)
for and on behalf of Deloitte LLP
Chartered Accountants and Statutory Auditors
Reading, United Kingdom
## September ####
# l

CONV ATEC LIMITED
PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED ## DECEMBER ####
Note #### ####
£’### £’###
TURNOVER # ###,### ###,###
Cost of sales (###,###) (###,###)
GROSS PROFIT ##,### ##,###
Distribution costs (##,###) (##,###)
Administrative expenses
- Other (##,###) (##,###)
- Curtarlment gains on pension scheme ## - #,###
- Impairment of investment ## - (##,###)
OPERATING PROFIT ##,### ##,###
Income from subsidiary undertakings ## - ##,###
Finance charges (net) # (#,###) (#,###)
PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION # ##,### ##,###
Tax on profit on ordinary activities # ### (##,###)
PROFIT ON ORDINARY ACTIVITIES
AFTER TAXATION ## ##,### ##,###
Turnover and operating profits are derived from continuing activities
The notes on pages ## to ## form part of these financial statements

CONVATEC LIMITED
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE YEAR ENDED ## DECEMBER ####
Note #### ####
£’### £’###
Profit for the financial year ##,### ##,###
Actuanal loss on pension scheme ## - (##,###)
Movement on deferred tax relating to pension asset ## - #,###
TOTAL RECOGNISED GAINS AND LOSSES
FOR THE YEAR ##,### ##,###
There are no material differences between the profit on ordinary activities before taxation and the
retained profit for the year stated above and their historical cost equivalents

CONV ATEC LIMITED
BALANCE SHEET AT ## DECEMBER ####
Note #### ####
£’### £’###
FIXED ASSETS
Intangible fixed assets - goodwill # # ##,### ##,###
Tangible fixed assets ## ##,### ##,###
Fixed asset investments ## #,### #,###
###,### ###,###
CURRENT ASSETS
Stocks ## ##,### ## ,###
Debtors ## ###,### ##,###
Cash at bank and in hand #,### # #,###
###,### ##,###
Creditors Amounts falling due within one year ## (##,###) (##,###)
NET CURRENT ASSETS/ (LIABILITIES) ##,### (#,###)
TOTAL ASSETS LESS CURRENT LIABILITIES ###,### ###,###
Creditors Amounts falling due after more than one year ## (#,###) (###)
Provision for liabilities and charges ## (#,###) (###)
NET ASSETS ###,### ###,###
CAPITAL AND RESERVES
Called up share capital ## ## ##
Share premium account ## ##,### ##,###
Profit and loss account ## ###,### ##,###
TOTAL SHAREHOLDERS’ FUNDS ## ###,### ###,###
Approved by the Board on ## September #### and signed on its behalf by
S J Taylor # Company registration number' ########
Director
The notes on pages ## to ## form part of these financial statements

CONV ATEC LIMITED
#. NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER ####
# ACCOUNTING POLICIES
(a) Basis of Preparation
The financial statements have been prepared under the historical cost convention, in accordance
with the Companies Act #### and applicable accounting standards in the UK The principal
accounting policies, which the directors have adopted within those standards, and which have been
consistently applied are stated below.
Going Concern
ConvaTec Lim#Ted’s business activities, together with the factors likely to affect its future
development, performance and position are set out in the business review on page #. The company
had net current liabilities at ## December #### This position has been reversed dung ####.
The company continues to generate strong profit and cash flows and expects to continue to do so
for the foreseeable future The company is part of a group which has considerable financial
resources and given the nature of its customer base, the directors believe that the group is well
placed to manage its business risks successfully despite the current uncertain economic outlook
The directors have a reasonable expectation that the company and the group have adequate
resources to continue in operational existence for the foreseeable future Thus, they continue to
adopt the going concept basis in preparing the annual report and financial statements
(b) Turnover
Turnover represents the value of goods sold and delivered to customers during the year, exclusive
of value added tax It is calculated net of trade discounts Turnover is recognised at the point of
despatch
(c) Research and Development
Research and development expenditure is written off to the profit and loss account in the year in
which rt is incurred
(d) Tangible fixed assets
Tangible fixed assets are stated at cost less accumulated depreciation and any provision for
impairment Depreciation is provided to write off the cost less estimated residual value of fixed
assets over their estimated useful economic lives, on a straight line basis, as follows
Buildings #%
Leasehold improvements over the remaining life of the lease
Plant and machinery # ##% to ##%
Leased vehicles over the remaining life of the lease
Office machines, furniture and fixtures ##% to ##%
Personal computers ## #%
Land and construction in progress are not depreciated
##

CONVATEC LIMITED
NOTES TO TI-IE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
#
ACCOUNTING POLICIES (CONTINUED)
(e) Fixed asset investments
(#
Fixed Asset Investments are shown at cost less provision for impairment
Stocks and work in progress
Stocks and work in progress have been valued at the lower of cost and net realisable value Net
realisable value is the price at which stocks can be sold in the normal course of business after
allowing for the costs of realisation and, where appropriate, the cost of conversion to a finished
condition Cost includes labour and overheads appropriate to the stage of production reached
Provision is made for obsolete slow moving or defective items where appropriate
(g) Leases
Finance leases are capitalised at the amount equal to the fair value of the asset with an equivalent
liability categorised as appropriate under creditors due within or after more than one year Finance
charges are calculated so as to produce a constant periodic rate of charge on the remaining
balances
Operating lease rentals are charged to the profit and loss account on a straight line basis, over the
lease term
(h) Foreign currency translation
(i)
Transactions denominated in foreign currencies are translated at the rate of exchange prevailing on
the transaction date Monetary assets and liabilities denominated in foreign currencies are
translated at the exchange rates ruling at the balance sheet date Exchange differences are included
in the profit and loss account for the year
Taxation
Current tax, including UK corporation tax and foreign tax, is provided at amounts expected to be
paid (or recovered) using the tax rates and laws that have been enacted or substantively enacted by
the balance sheet date. Deferred taxation is recognised in respect of all timing differences that have
consternated but not reversed at the balance sheet date where transactions or events that result in an
obligation to pay more tax in the future or a right to pay less tax in the future have occurred at the
balance sheet date. Timing differences are differences between the Company’s taxable profits and
its results as stated in the profit and loss account
Deferred tax is measured at the average rate expected to apply in the period in which the timing
differences are expected to reverse
A net deferred tax asset is regarded as recoverable and therefore recognised only to the extent that,
on the basis of all available evidence, it can be regarded as more likely than not that there will be
suitable taxable profits from which the future reversal of the underlying timing differences can be
deducted
ll

CONVATEC LIMITED
NOTES TO TI-IE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
# ACCOUNTING POLICIES (CONTINUED)
Pensions
From the ## of July ####, following the sale of ConvaTec Ltd by the Bnstol-Myers Squibb group,
the company’s employees have been members of a defined contribution scheme The contributions
paid by the company are dependant upon an employee’s age The Company’s contribution to
employees’ pension is accounted as part of the pension expense for the year
(k) Group accounts
The financial statements contain information about ConvaTec Limited as an individual Company
and do not contain consolidated information as the parent of a Group The Company is exempt
under section ### of the Companies Act #### from the requirement to prepare consolidated
financial statements, as rt is part of a larger Group which prepares consolidated financial
statements
Goodwill
Goodwill, which represents the excess of the fair value of the purchase consideration for
businesses acquired over the fair value of the underlying net assets, is amortised over its useful
economic life, which for acquisitions to date has been estimated to be twenty years. Where
goodwill of a business is considered to have been impaired an additional charge is recorded to
reduce the carrying value to its recoverable amount
(m)Finance costs
Finance costs of financial liabilities are recognised in the profit and loss account over the term of
such instruments at a constant rate on the carrying amount
Finance costs which are directly attributable to the construction of tangible fixed assets are
capitalised as part of the cost of those assets The commencement of capitalisation begins when
both finance costs and expenditures for the asset are being incurred and the activities that are
necessary to get the asset ready for use are in progress Capitalrsatron ceases when substantially all
the activities that are necessary to get the asset ready for use are complete.
(n) Financial liabilities and equity
Financial liabilities and equity instruments are classified according to the substance of the
contractual arrangement entered into An equity instrument is any contract that evidences a
residual interest in the assets of the group after deducting all its liabilities
(o) Bank borrowing
Interest-beaning bank loans are recorded at the proceeds received, net of issue costs. Finance
charges, including issue costs are accounted for on an accrual basis in the profit and loss account
using the effective interest method and are added to the carrying amount of the instrument to the
extent that they are not settled in the period in which they arise
##

CONVATEC LIMITED
NOTES TO THE FINANCIAL STATENIENTS - ## DECEMBER #### (CONTINUED)
#
(P)
#
#
ACCOUNTING POLICIES (CONTINUED)
Government grants
Govemment grants relating to tangible fixed assets are treated as deferred income and released to
the profit and loss account over the expected useful lives of the asset conceded Other grants are
credited to the profit and loss account as the related expenditure is incurred
CASH FLOW STATEMENT
The Company has taken advantage of the exemption granted by Financial Reporting Standard #
(Revised ####) Cash Flow Statements to wholly owned subsidiaries of a parent undertaking
presenting a Group cash flow statement whose financial statements are publicly available
Accordingly no cash flow statement has been prepared
TURNOVER
All tu mover arises from the Company’s principal activity within the United Kingdom The
analysis of turnover by geographical destination is as follows.
#### ####
£’### £’O##
United Kingdom ##,### ##,###
Rest of Europe ##,### ##,###
North America ##,### ##,###
Other ##,### ##,###
###,### ###,###
Further information by class of business and by geographical segment has not been given since in
the opinion of the directors, disclosure of such information would be venously prejudicial to the
interests of the Group
##

CONVATEC LIMITED
NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
# FINANCE CHARGES (NET)
####
£’###
Finance lease rental payments (##)
Interest payable to Group undertakings (###)
Other interest payable (#,###)
(#,###)
Finance costs capitalised ###
(#,###)
Expected rectum on assets in the pension scheme
less interest on pension scheme liabilities -
Interest receivable from Group undertakings ###
Other interest receivable l ##
###
Net interest payable (#,###)
####
£’###
(##)
(#,###)
(# ,###)
(#,###)
(#,###)
###
###
###
(#,###)
From # August ####, interest calculated on intercommunicate loans is equal to LIBOR plus ## basis
points where Convatec Holdings Ltd is the lender Additionally interest calculated on intercommunicate
loans is equal to LIBOR plus ## basis points where Amcare Ltd and Convatec Speciality Fibres Ltd
are the lender
Amounts owed to ConvaTec Inc attract interest at a rate of #% per annum

CONVATEC LIMITED
NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
# PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION
Profit on ordinary activities before taxation IS stated after charging/ (crediting) the following
Depreciation of tangible fixed assets - leased
- owned
Amortisation of goodwill
Research and development
- costs incurred
- recharged to Group undertakings
Foreign exchange gains - net
Operating lease rentals - plant and machinery
Fees payable to the Company’s auditors for the audit of
the Company’s annual accounts
Gain on sale of tangible fixed assets
Dividend income
Investment pimiento
Cinstalment gain from pension scheme (note ##)
Royalties paid
####
£’###
###
#,###
#,###
#,###
(#,###)
(#,###)
###
###
(##)
##,###
####
£’###
###
#,###
#,###
#,###
(#,###)
(#,###)
#,###
###
(###)
(##,###)
##,###
(#,###)
##,###

CONVATEC LIMITED
NOTES TO THE FINANCIAL STATEIVIENTS - ## DECEIVIBER #### (CONTINUED)
# TAX ON PROFIT ON ORDINARY ACTIVITIES
####
####
Current tax:
UK Corporation tax on profits for the period
Adjustments in respect of previous years
£’###
#,###
(#,###)
£’###
##,###
#,###
Total current tax
Deferred tax:
Ongrnatron and reversal of timing differences
Adjustments in respect of nor year
Effect of decrease in tax rate on opening liability
(#,###)
#,###
###
(###)
##,###
#,###
###
Total deferred tax charge
#,###
#,###
Tax on profit on ordinary activities
(###)
##,###
The tax assessed for the year is the current ##% rate of corporation tax in the
(#### the blended rate ## #%) The differences are explained below:
####
United Kingdom
####
Profit on ordinary activities before taxation
£’###
##,###
£’###
##,###
Profit on ordinary activities multiplied by standard
rate in the United Kingdom ##% (#### blended
rate ## #%)
Effects of z
Group relief received for no consideration
Prior year adjustments, including utilisation of
prior year tax losses
Expenses not deductible for tax purposes
Accelerated capital allowances and other timing
differences
Transfer pricing adjustment
##,###
(#,###)
(#,###)
#,###
(#,###)
(###)
##,###
#,###
#,###
(#,###)
Current tax (credit)/charge for year
(#,###)
##,###
##

CONVATEC LIMITED
NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
# STAFF NUIVIBERS AND COSTS
The average number of persons employed during the year was as follows
####
Number
Production ###
Selling ###
Administration ###
###
The aggregate payroll costs of these persons were as follows
####
£’###
Wages, salaries and share option bonus scheme ##,###
Social security costs #,###
Other pension costs #,###
## ,###
####
Number
###
###
###
# ,###
####
£’###
##,###
#,# ##
#,###
##,###

CONVATEC LIMITED
NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
# DIRECTORS’ EMOLUMENTS
#### ####
£‘### £'###
Emoluments ### #,###
Company contributions to money purchase scheme ### ###
### #,###
During #### # (#### #) directors were members of the defined contribution pension scheme of
the group
Emoluments of the highest paid director were
#### ####
£`### £‘###
Aggregate emoluments and benefits ### ###
Defined contribution schemes - accrued pension at
end of year ## ##
# DIVIDENDS ON EQUITY SHARES
Amounts recognised as distributions to equity holders in the period.
#### ####
£’### £’###
Final dividend for the year ended ## December
#### of ## ##p (#### ### # lo) per ordinary share #,### ##,###
A dividend in specie was paid to ConvaTec Holdings Limited in both the current and prior year in
relation to payment of acquisition costs on its behalf incurred on acquisition of the ConvaTec
business from Bristol-Myers Squrb during ####
##

CONVATEC LIMITED
NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
## TANGIBLE FIXED ASSETS
Cost
At # January ####
Additions
Disposals
Transfers
At ## December ####
Depreciation
At # January ####
Charge for the year
Disposals
At ## December ####
Net book amount
At ## December ####
At ## December ####
Freehold Short term
Land and Leasehold Plant and Fittings and Construction
Buildings Interest Machinery Fixtures in Progress Total
£’### £’### £’### £’### £’### £’###
##,### #,### ##,### #,### ##,### ###,###
## - #,### ## #,### #,###
(###) - (#,###) (##) - (#,###)
## # ### ## - ###
##,### #,### ##,### #,### ##,### ###,###
#,### #,### ##,### #,### ##,###
### ### #,### ### #,###
(###) - (#,###) (##) (#,###)
#,### #,### ##,### #,### ##,###
##,### ### ##,### #,### ##,### ##,###
##,### ### ##,### #,### ##,### ##,###
For assets held under finance leases, cost is £#,###,### (#### £#,###,###) and accumulated
depreciation £###,### (####' £###,###). These are included within Plant and Machinery above
Cumulative finance costs capitalised included in the cost of tangible fixed assets amount to £###,###
(#### £n#l)
##

CONV ATEC LIMITED
NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
## INTANGIBLE FIXED ASSETS - GOODWILL
Goodwill
£’###
Cost
At # January and ## December ##,###
Amortisation
At # January (#,###)
Charge for the year (#,###)
At ## December (##,###)
Net book value at ## December #### ##,###
Net book value at ## December #### ##,###
On # January ####, the trade and certain assets and l#an#l#t#es of the Company’s wholly-owned
subsidiary, ConvaTec Speciality Fibres Limited (“CSF”), were hived-up into the company The
element of the cost of investment balance which exceeded the net assets in CSF was transferred to
goodwill
## FIXED ASSET INVESTMENTS
Shares in subsidiary undertakings
Cost
At # January and ## December
Provisions for impairment
At # January and ## December
Net book value at ## December ####
Net book value at ## December ####
####
£’###
##,###
(##,###)
#,###
#,###

CONV ATEC LIMITED
NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
##. FIXED ASSET INVESTIVIENTS (CONTINUED)
During ####, £nil (#### £##,###,###) dividend was received from the subsidiary undertaking
ConvaTec Speciality Fibres Limited The #### payment of the dividend reduced the valuation of
the company’s investment in ConvaTec Speciality Fibres Limited Accordingly, an impairment
provision of £l#,###,### was recorded to write the investment down to its recoverable amount
dung the year ended ## December ####
Interests in subsidiary undertakings
The following information relates to the subsidiary undertakings of the Company
Name of undertaking Descnption Proportion Pnncipal activity of undertaking
of shares of shares
held held
ConvaTec Speciality Ordinary ###% Non-trading
Fibres Limited
The Company is registered in England and Wales
Investments in Group undertakings are stated at cost, less any provision for permanent diminution
in value of the investment.
#### ####
£’### £’###
Convatec Speciality Fibres Limited
Aggregate capital and reserves #,### #,###
Profit for the year ### ###
## STOCKS
#### ####
£’### £’###
Raw maternal #,### #,###
Work in progress #,### #,###
Finished goods ##,### ##,###
##,### ##,###

CONVATEC LIMITED
NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
## DEBTORS
####
£’###
Trade debtors ##,###
Amounts owed by Group undertaken g ##,###
Deferred tax (note ##) -
VAT debtor ###
Prepayments and accrued income #,###
Other debtors #,###
Corporation tax debtor #,###
###,###
## CREDITORS: amounts falling due within one year
####
£’###
Obligations under finance leases (note ##) ###
Trade creditors #,###
Amounts owed to Group undertakings ##,###
Corporation tax liability -
Other taxation and social security ###
Accruals and deferred income #,###
Accrued pension contributions -
Other creditors #,###
Govemment grant ###
##,###
## CREDITORS: amounts falling due after more than one year
####
£’###
Obligations under finance leases (note ##) ##
Govemment grant ###
Bank Loan #,###
#,###
Interest on bank borrowings IS paid at EURIBOR plus #%
####
£’###
##,###
##,###
###
###
#,###
##,###
####
£’###
###
##,###
##,###
##,###
###
##,###
#,###
##,###
####
£’###
###
###

CONVATEC LIMITED
NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
##. CREDITORS: amounts falling due after more than one year (CONTINUED)
The bank loan IS repayable as follows
#### ####
£’### £’###
Between one and two years ### -
Between two and five years #,### -
After five years - -
On demand or within one year - -
#,### -
## FINANCE LEASE OBLIGATIONS
The net finance lease obligation to which the Company is committed is
#### ####
£’### £’###
in one year or less ### ###
Between two to five years ## ###
### ###
The obligations under finance leases are secured against the underlying assets to which they relate
## PROVISION FOR LIABILITIES AND CHARGES
Lease restoration Redundancy Deferred
provision provision taxation Total
£’### £’### £’###
At # January #### (###) - (###)
b/f DT asset (note ##) - - ### ###
Charge to profit and loss
account (##) (#,###) (#,###) (#,###)
At ## December #### (###) (#,###) (#,###) (#,###)

CONV ATEC LIMITED
NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
## PROVISION FOR LIABILITIES AND CHARGES (CONTINUED)
Lease restoration provision
At the inception of the lease by ConvaTec Ltd of their premises, it was agreed that alterations
could be made to the building, provided that the building would be retuned to its original state at
the end of the lease The expected l#an#l#Ty at the end of the lease has been discounted to its net
present value, and this amount is maced in the balance sheet as a provision
Redundancy provision
As a result of group restructuring a head count reduction plan was implemented during the year at
one of the company’s sites The expected liability at the year end is maced as a provision The
redundancies will take place dung the year to ## December #### This amount IS not discounted
Provision for deferred tax
#### ####
£’### £’###
Deferred tax is provided as follows
Accelerated capital allowances (#,###) (#,###)
Other timing differences #,### #,###
Deferred tax (l#an#l#Ty)/asset (#,###) ###
Asset/(Liability) at # January ### (###)
Deferred tax charge in profit and loss account
(note #) (#,###) (#,###)
Deferred tax credited to reserves in relation to
defined benefit pension scheme (see note ##) #,###
Deferred tax credited to the Statement of Total
Recognised Gains and Losses - #,###
Total (liability)/asset at ## December (#,###) ###

CONVATEC LIMITED
NOTES TO THE FINANCIAL STATEIVIENTS - ## DECEl\/[BER #### (CONTINUED)
## SHARE CAPITAL
#### ####
£’##O £’###
Allotted, called up and fully paid
##,### (#### ## ,###) ordinary shares of £#
each ## ##
## RESERVES
Share Total Shareholders’ funds
Called up Premium Profit and
Share capital Account Loss account #### ####
£’### £’### £’### £’### £’###
At # January ## ##,### ##,### ###,### ##,###
Profit for the year ##,### ##,### ##,###
Distnbutron to Bristol-Myers Squibb
in relation to defined benefit pension
scheme (note ##) (#,###)
Actuanal loss on pension scheme (##,###)
Movement on deferred tax relating to
pension scheme - - #,###
Dividend paid to ConvaTec Holdings
UK Limited (note #) (#,###) (#,###) (##,###)
New shares issued - - ##,###
At ## December ## ##,### ###,### ###,### ###,###
##

CONV ATEC LIMITED
NOTES TO THE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
## RECONCILIATION OF MOVEMENT IN SHAREHOLDER’S FUNDS
#### ####
£’### £’###
Profit for the year ##,### ##,###
Distribution to Bnstol-Myers Squibb in relation to defined benefit
pension scheme (note ##) - (#,###)
Actuarial loss on pension scheme - (##,###)
Movement on deferred tax relating to pension scheme - #,###
Dividend paid to ConvaTec Holdings UK Limited (#,###) (##,###)
New shares issued - ##,###
Net additions to shareholder’s funds ##,### ##,###
Opening shareholder’s funds ###,### ##,###
Closing shareholder’s funds ###,### # ##,###
## PENSION COMMITMENTS
On # August ####, following the separation of ConvaTec Limited from the Bnstol-Myers Squibb
group, the ConvaTec employees became deferred members of the Bristol-Myers Squibb defined
benefit pension scheme This resulted in a curtailment gain of £# ### million which was included
in the profit for the prior year
ConvaTec Limited made a final contribution to the pension scheme during the year ended ##
December #### of £## #m in final settlement of all future l#an#l#t#es in relation to the scheme
Consequently the company had no obligations to the Bnstol-Myers Squibb pension scheme at ##
December #### (## December #### £n#l)
The payment exceeded ConvaTec L#m#Ted’s share of the of the FRS ## liability at ## July #### by
£# ## million This net of the movement in deferred tax of £# ### million was taken to reserves in
the nor year. The net amount was a reduction in reserves of £# ### million which can be seen in
note ##
There have been no such transactions in the current year ConvaTec Limited operates a defined
contribution pension scheme
##

CONVATEC LIMITED
NOTES TO TI-IE FINANCIAL STATEMENTS _ ## DECEMBER #### (CONTINUED)
## CAPITAL COMMITMENTS
Capital commitments at ## December #### for which no provision has been made In these
financial statements were £###,### (####. £#l#,###)
## OPERATING LEASE COMMITMENTS
Annual commitments In respect of leases which expire'
Land and Buildings
#### ####
£’### £’###
Within one year ## ##
Between one and five years - ###
Beyond five years ### ###
### ###
## CONTINGENT LIABILITY
The Company has given a composite guarantee In favour of National Westminster Bank PLC for the
bank Indebtedness of the UK Group, to the value of £###,### (#### £###,###)
The ultimate parent undertaking, has secured borrowings against the underlying assets of various
subsidiaries within the group, including those of ConvaTec Limited. These outstanding
borrowings totalled approximately $# # billion at ## December ####
## RELATED PARTY TRANSACTIONS
The Company has taken advantage of the exemption available under Financial Reporting Standard
# Related Party Disclosures for disclosure of transactions with other group companies
##

CONVATEC LIIVIITED
NOTES TO TI-IE FINANCIAL STATEMENTS - ## DECEMBER #### (CONTINUED)
## ULTIMATE PARENT UNDERTAKING
The ultimate parent undertaking and controlling party is Crdron Healthcare Ltd, which IS
Incorporated In Jersey Consolidated financial statements for ConvaTec Healthcare A S a.r #, the
largest Group to consolidate the results of this Company, can be obtained from The Manager,
Noella Antoine, ConvaTec Healthcare A S ail, # rue Guillaume Kroll, L-#### Luxembourg,
Grand Duchy of Luxembourg
The Immediate parent undertaking IS ConvaTec Holdings UK Ltd, which is registered in England
& Wales. ConvaTec Healthcare B S a r.l IS the smallest Group of undertakings for which accounts
are drawn up and of which the Company is a member Consolidated financial statements for
ConvaTec Healthcare B S ail can be obtained from The Manager, Ingrid Mornet, Convatec
Healthcare B S a r # , # nine Guillaume Kroll, L-#### Luxembourg, Grand Duchy of Luxembourg
##