Final Results

SYNERGY HEALTH PLC

("Synergy", the "Company" or the "Group")

PRELIMINARY RESULTS FOR THE TWELVE MONTHS ENDED 30 MARCH 2014

Synergy Health plc (LSE: SYR), a leading global provider of specialist outsourced support services to health-related markets in the UK & Ireland, Europe & Middle East, Asia & Africa, and the Americas, announces its preliminary results for the year ended 30 March 2014.

Financial Highlights

· Reported revenue growth of 5.3%. Underlying revenue growth, excluding currency effects, of 4.1%

· Adjusted operating profit2 margin increased by 50 basis points to 16.1% (2013: 15.6%)

· Operating cashflow increased 2.9% to £98.0 million (2013: £95.2 million), with cash conversion of 95% (2013: 96%)

· Net debt decreased to £147.6 million (2013: £177.3 million)

· Return on average capital employed ('ROCE') increased to 12.0% (2013: 11.6%)

· Total dividend up 10%,emphasising strong free cash flow and confidence in our outlook

Operational Highlights

· Won several contracts totalling £48 million per annum, adding £0.5 billion to the forward order book, now at £1.5 billion

· In the US, interim services are underway on what is Synergy's largest ever HSS contract win, with a new facility opening in May 2015

· In China, we are progressing with the opening of three new HSS facilities in Wuhan, Nanjing, and Chengdu.

· Over one quarter of our revenue now comes from our Americas and Asia and Africa regions, up from 22% in 2013, and we expect this trend to continue

· In the UK, we have won four new HSS contracts collectively worth £1.6 million per annum

· In Europe, we have opened a new gamma irradiation facility at Marcoule, France

· After the close of this financial year, we acquired the Bioster Group for €29 million net of cash and debt, extending Synergy's Applied Sterilisation Technologies network into Italy and Eastern Europe.

Outlook

We begin the new fiscal year implementing £48 million of new work over the next 18 months, which will steadily raise Synergy's growth rate. Together with a global bid book of over £100 million per annum, we have confidence in our strategy and our ability to lift our rate of earnings growth.

Richard Steeves, Chief Executive of Synergy Health, said:

"I am confident that Synergy's updated strategy will build on the success we have seen in recent months with new contract wins. The continued internationalisation of our services is broadening the available market, whilst our new structure, new talent and new service range will contribute towards a faster rate of growth."

"We are very excited about the opportunity to expand our laboratories business into the testing, inspection and certification market, creating a new opportunities to deepen our relationships with our AST and HSS customers and broadening our growth opportunities."

1 Note: Adjusted operating profit, adjusted profit before tax and adjusted earnings per share exclude amortisation of acquired intangibles, non-recurring items and acquisition-related costs, as shown in the Group's consolidated income statement and the accompanying notes. Operating cash flow is before non-recurring items and acquisition-related costs.

2 Restated to reflect the amendments to IAS 19 Employee Benefits

Further information:

There will be a meeting for analysts at 9.30am today, 4 June 2014, at Investec, 2 Gresham Street, London EC2V 7QP.

For further information:

CHAIRMAN'S STATEMENT

I am pleased to report that Synergy has continued to make further progress with its objective to expand internationally, win new contracts and to build a forward order book that will result in a sustainable increase in growth. Our decision to enter the US market has resulted in two of the largest contract wins in Synergy's history, worth a combined £40 million of annualised revenues, and will pave the way for future development of the US outsourcing market. Similar progress, albeit on a smaller scale, is being made in China with the rapid expansion of our hospital sterilisation network.

Results

Our progress in 2014 delivers a robust set of results achieved in challenging economic conditions, with significant growth in operating profit and earnings per share. Reported revenue of £380.5 million (2013: £361.2 million) was up 5.3%, and after removing the impact of currency movements was up 4.1%. Adjusted operating profit was £61.3 million (2013: £56.2 million), representing an increase of 9.1%. Underlying adjusted operating profit growth was 7.9%. Adjusted operating margin increased to 16.1% (2013: 15.6%), an increase of 50 basis points.

Over one quarter of our revenue now comes from our Americas and Asia and Africa regions, up from 22% in 2013, and we expect this trend to remain in place for some time.

We have continued the restructuring of our Dutch linen business and closed and consolidated a further two facilities during the year. The combined effects of acquisition-related expenditure and Dutch restructuring costs resulted in non-recurring costs of £3.3 million. After taking account of amortisation, non-recurring items and acquisition-related costs, profit before tax increased by 13.0% to £42.9 million (2013 restated: £38.0 million).

Shareholder return

Driven by the growth in revenue and operating margin, adjusted basic earnings per share before intangibles, amortisation, non-recurring items and acquisition-related costs amounted to 70.59p (2013 restated: 65.58p), an increase of 7.6%. After taking account of amortisation, non-recurring items and acquisition-related costs, basic earnings per share were 57.81p (2013 restated: 53.00p), an increase of 9.1%. The final dividend will be paid, subject to shareholder approval, on 4 September 2014 to shareholders on the register as at 8 August 2014.

An interim dividend of 8.57p per share (2013: 7.90p) was paid to shareholders on 13 December 2013. The Board is proposing a final dividend of 14.20p, which together with the interim dividend would give dividends for the year totalling 22.77p (2013: 20.70p) representing a 10.0% increase.

Business Development and Acquisitions

In 2013/2014, we won a number of contracts that in aggregate added £0.5 billion to our forward order book, which now stands at £1.5 billion including contracts at preferred bidder stage. In addition we opened one new gamma irradiation facility at Marcoule, France and after the close of this financial year, acquired the Bioster Group for €29 million net of cash and debt, extending Synergy's Applied Sterilisation Technologies network into Italy and Eastern Europe.

Further details of this acquisition and other investments are disclosed in the Regional Operating Review, and in the notes to the financial statements. Our strategy of growing key industry sectors through acquisitions is unchanged, and with our strong financial position we will continue to consider targeted bolt-on acquisitions and to evaluate strategic acquisitions to increase shareholder value.

The Board

On 25th July, 2013, it was announced that Dr Richard Steeves, Group CEO would succeed me as Non-Executive Chairman of the Group upon my retirement on 31 March 2014, and that Dr Adrian Coward would take over from Richard as Group CEO. On account of the expanding opportunities for growth in outsourced hospital sterilisation services in the US, and as the Group continues to grow, there is a need to split strategic and operational oversight via a separate CEO and COO. Therefore, the Board has decided that Dr Steeves should defer his move from CEO to Chairman and similarly I have delayed my retirement. Dr Adrian Coward, formerly CEO for the UK & Ireland region, has now taken on a broader role as Chief Operating Officer for the Group and joined the Board on the 31 March 2014.

Jeff Harris joined the Board as the Senior Independent Non-Executive Director in September 2013. Jeff brings impressive business and governance experience from his time as Chief Executive and then Chairman of Alliance UniChem plc, and through serving on a number of other plc boards.

Tim Mason, Group Company Secretary, is to retire at the conclusion of the next AGM, on the 23 July 2014. Jon Turner, currently Head of Tax and Treasury, will assume a broader role, becoming Group Company Secretary at that time. The Board would like to thank Tim for his excellent support over the last five years, and wish Jon every success in his new role.

The Board places great emphasis on governance and is mindful of its responsibility to promote the long-term interests of the company for all our stakeholders. This is described in detail in the Corporate Governance section of our Annual report.

Corporate responsibility

We give high priority to compliance and ethics, as well as health, safety and the environment. Our core values of integrity, innovation, accountability and achievement are central to the relationships we have with all our stakeholders, and underpin how we treat our customers, our suppliers, and the wider communities in which we operate. Details of the Group's approach to Corporate and Social Responsibility are disclosed in our Annual Report.

Our people

I would like to take this opportunity to thank all staff for their focus and engagement throughout the year. Synergy's well-earned reputation for operational excellence, and its ability to deliver on its commitments to customers, is testament to the effectiveness of those efforts and the shared values to which we all subscribe.

Outlook

Synergy remains well placed to exploit its core competitive strengths, strong operational capabilities and internationally respected brand. The business has a number of opportunities for earnings-enhancing investment, and the Board is confident that these will deliver strong growth in shareholder value over the coming years.

Sir Duncan Nichol

Chairman

4 June 2014CHIEF EXECUTIVE'S REVIEW

Introduction

Synergy is a global leader in outsourced sterilisation services for medical device manufacturers, hospitals and other industries. Worldwide, we operate a complete range of sterilisation technologies including gamma, ethylene oxide ('EtO'), electron beam, x-ray, steam and plasma. Across the healthcare industry, Synergy also provides other niche outsourced services such as laboratory services (pathology, toxicology, microbiology and food and allergen testing) and healthcare linen services. All of our businesses have the benefit of significant barriers to entry, stable long-term contracts and good cash generation.

Writing last year, I anticipated that 2013/14 could mark an inflexion point for Synergy with a return to stronger organic growth. This year we have won new long-term contracts worth £39 million per annum in the US, £6.7 million per annum in the UK, and approximately £2.1 million per annum in Asia. Our forward order book has jumped from £1.0 billion to £1.5 billion. We have also progressed over half way to our target of having 50% of our revenue generated outside the UK and Europe. The Americas and Asia and Africa regions now account for 25.4% of revenue and 20.4% of our adjusted operating profits, in the context of the Group's reported revenues of £380.5 million (2013: £361.2 million) and adjusted operating profits of £61.3 million (2013: £56.2 million). In constant currency, revenue growth was up 4.1% and adjusted operating profit growth was 7.9%.

Although our order book has grown significantly, the new contracts won will commence over the next eighteen months, and hence were not reflected in this year's revenues. In addition, it has been a difficult year with little, if any, healthcare volume growth in the developed countries, caused by the Affordable Care Act in the US and continued austerity measures in the UK and Europe. We have also seen a further decline in Dutch linen revenues of 10.9% in constant currency terms and the last fiscal quarter, which is usually our strongest, was affected by extreme weather in the US and Europe. On a constant currency basis, growth for the year was a respectable 8.6% excluding linen. In light of the Dutch linen concerns we reviewed the Group strategy in November and a number of changes are being implemented during the new fiscal year.

Strategy

Our objective is to grow revenue and earnings by approximately 15% per annum through a combination of organic and acquisitive growth. With inflation no greater than 2% and volume growth in a similar 0-2% range for the next few years, the growth challenge is significant. Our addressable markets are very large however, with the global AST market estimated to be worth £1.5 billion per annum, the UK HSS market worth £0.3 billion per annum and the US HSS market worth £1.8 billion per annum. To address the growth challenge we have implemented a four-step plan that builds on our US-UK operating axis. The key objectives and strategies are to:

a) Grow AST by at least 10-12% per annum by continuing to internationalise the network through organic growth and acquisitions, whilst differentiating our services through technology and our people.

During the year we opened the new gamma facility in Marcoule France and after the year end, acquired the Bioster Group in Italy, extending our network across Southern and Eastern Europe with facilities in Italy, Slovakia and the Czech Republic. Globally Synergy's AST business is number two in the world and has the largest processing capacity outside the US market.

b) Grow HSS by 10-20% per annum by focusing our outsourcing growth in the US, UK and Asia, whilst offering easily scalable HSS technologies to a broader market. Our own surgical instrument management software, SynergyTrak™ (formerly known as TrakStar), supported by radio-frequency identification ('RFID') technologies, will increase operating room utilisation and reduce patient risk.

Synergy is the largest provider of healthcare outsourcing services globally, and has the scale to differentiate itself from in-house solutions and commercial competitors by continuing to invest in new technology. For example, Synergy recently introduced a new, patented RFID tunnel reader that can mass-read a large tray of instruments with one hundred per cent accuracy in less than 40 seconds. This presents an opportunity to revolutionise the assembly of instrument trays, as well as decrease risk in the operating room. We will continue to invest in research and development ('R&D') with the recruitment of a Chief Technology Officer and a ring-fenced R&D budget of 0.5% of revenue per annum.

With recent wins of £41.1 million per annum in the US and China, together with a reopening of the UK market, the Group is poised to see a strong return to growth. We will see the revenue impact of the first of these large contracts starting in September 2014 and the second in May 2015.

c) Expand the linen services into service adjacencies to broaden their growth prospects and reduce our dependency on pure linen. Whilst the UK service has done well, winning contracts worth over £5.1 million per annum, the Dutch service is seeing a further contraction in their market as the Dutch health service restructures long-term care. The current strategy for this service is very much based on cost leadership, so that at any given price, we intend to make a higher margin than our competitors. Our focus in the new financial year is to restore revenue growth.

d) Expand Synergy's services into a third market with very strong adjacencies to both the AST and HSS businesses. Our attention is broadly focused on the inspection, testing and certification market, building on our existing laboratory business. During the year we acquired Genon Limited, a small UK-based food testing laboratory, and we anticipate further acquisitions to help create scale in this space. We expect this new service to gain momentum during 2015 and beyond.

Leadership and a revised Group Structure

It remains a cornerstone of Synergy's strategy to rapidly internationalise our business and to decrease our reliance on Europe. However, we have to recognise that the US-UK axis is becoming increasingly important, as is the need to extract scale benefit from our global operations in each service line. Accordingly the Board has decided to restructure the Group in the new fiscal year, replacing our regional structure with a service line structure. In addition we have split the role of the Group Chief Executive Officer ('CEO'), creating a Chief Operating Officer ('COO') role to oversee the day-to-day operations, whilst the CEO focuses on strategy and long term planning. I have remained in my role as Group CEO, and the former CEO of the UK & Ireland and Europe & Middle East regions, Dr. Adrian Coward, has become our COO and joins the plc Board.

We believe that this structure will enable us to implement the new strategy effectively and to deliver the global organic growth we are striving for, whilst maintaining our reputation for operational excellence and delivering a service that generates outstanding value for our customers.

During the year we began the search for a Chief Technology Officer to lead the R&D program. Elsewhere in the Group, we have made several senior leadership appointments to strengthen management, including:

· Global Vice President of Quality Assurance and Regulatory Affairs

· Global Vice President of Human Resources

· Global President AST & Laboratories

· US President AST

· US President HSS

Finally, on 16th May 2014 we completed our acquisition of the Bioster Group. Bioster operates nine AST sites, including six in Italy, one each in Slovakia and the Czech Republic and a small Joint Venture in Egypt. All the non-Italian facilities specialise in EtO sterilisation, whilst in Italy, electron beam sterilisation is offered at the Seriate, Bastia di Rovolon and Poggior Rusco facilities. The remaining Italian facilities also offer EtO sterilisation, as does Poggior Rusco, providing access to both technologies at the one site. In addition, Bioster engages in HSS outsourcing, with twelve facilities across Milan, Venice, Florence, Pescara and Naples. As with previous AST acquisitions, we expect that Bioster's rate of growth will increase as part of Synergy's global AST network and strong brand recognition in the global medical device market.

Financial Strength

Synergy is a robust business and in good shape with an internationally diversified business providing value-added services underpinned by long-term contracts. Cash generation remains strong, with adjusted EBITDA increasing by £4.0 million to £103.3 million (2013: £99.3 million), before non-recurring items. Net debt reduced to £147.6 million, reducing gearing to 1.5 times EBITDA, well below our internal ceiling of net debt at EBITDA of 2.5 times.

REGIONAL REVIEW

UK & Ireland

Austerity measures in the UK and Irish economies have continued to hold back spending within their respective national health services. However, there has been a distinct improvement in recent months that together with a pre-election boost for the NHS should feed through into a stronger year for Synergy. AST has delivered an upturn in underlying revenue growth of 4.5% compared with last year, but HSS growth was just 1.0%, reflecting flat patient volumes, an extending waiting list and the absence of new contract starts. As a result, our reported revenue in the UK and Ireland ('UK&I') region was £164.7 million (2013: £160.6 million), representing a 2.6% increase from last year. The region posted a 0.8% increase in reported operating profits, reaching £34.7 million (2013: £34.5 million).

In recent months we have secured an extension and expansion of our existing contract with one of our significant UK customers, cementing our position providing services to many of the large NHS trusts. Further, we have won four new HSS contracts collectively worth £1.6 million per annum, which we hope is a leading indicator that the outsourcing market is once again reopening.

Our scale and expertise in hospital sterile services has enabled us to invest in the development and exploitation of potentially transformational technology such as RFID. Our investment in RFID technology for mass instrument reading is a powerful technological advancement which strengthens the economic case for outsourcing, via improved outcomes for patient safety and service quality.

The AST business has showed moderate growth with a more buoyant medical device market. In both the UK and Ireland we are performing in line with expectations with 4.5% growth in constant currency.

In Healthcare services, Linen saw another strong performance with revenue increasing 4.2% on account of additional contract wins which have continued into the new financial year. Our UK labs service grew at 5.2% and was enhanced with the acquisition of Genon, a laboratory business in North Yorkshire specialising in food allergen testing. Overall our healthcare products business was flat year on year with underlying revenue growth of £1 million (legacy non-core product streams were ended during the early part of the previous year) but continued to strongly improve its profitability.

Finally, we have invested in new regional head offices in Derby, putting us closer to major infrastructure links and securing our position in the Midlands, allowing us to attract and retain talent in the healthcare industry.

Europe & the Middle East

The picture in Europe is not vastly different from the UK and Ireland but masks a very strong year for AST with 9.2% growth in constant currency offset by a revenue decline in our Dutch linen business, of 10.9% in constant currency terms. Overall the region's revenue was largely stable, with revenue of £119.1 million (2013: £120.2 million) but reported adjusted operating profit rose 19.8% to £20.0 million (2013: £16.7 million), in part reflecting the stronger AST mix.

The Dutch economy is still very weak and this is feeding through to a contracting healthcare market. We are continuing to see revenue contraction as the long-term care sector moves from institutional care to home healthcare. Management focus to restore operational efficiency in light of reduced volumes has been key in the short term. As indicated last year, we have completed the closure of an additional two facilities and have a clear strategy to deliver continuous incremental improvements to efficiency. We will now develop a long-term strategy that allows the business to seek growth in adjacent services, reducing its dependency on healthcare linen alone.

AST has had another solid year of growth in Europe. Marcoule in France has finally opened following regulatory delays, customers have begun to utilise new capacity added at Venlo, Netherlands, and we have seen organic growth of 9.2% at constant currency, despite severe weather in the fourth quarter.

After the end of the financial year we completed the acquisition of the Bioster Group for €29 million net of cash and debt. The acquisition has revenue of €20.2 million, mainly in EtO and electron beam technologies across Italy, Slovakia and the Czech Republic.

Europe has been a model for the implementation of our AST strategy, and our focus on acquisitive and organic growth has delivered impressive results. With our enlarged network, comprehensive range of technologies and expanding geographic coverage, the region is well placed to support its customers and to continue to grow in line with their success.

Americas

The Americas region has continued to show good growth, in what has been a largely preparatory year: we have spent time cementing our relationship with North Shore, working on significant contracts, and making management changes to ensure future progress across both divisions. Gains in market share from new contract wins will flow into the coming financial years, as these are initiatives that take time to deliver. Combined reported revenue growth for the region was 24.8%, achieving £77.8 million (2013: £62.4 million), with an adjusted operating profit increase of 19.6% to £8.8 million (2013: £7.3 million).

HSS revenue this year increased by 32.0%, reaching £63.5 million (2013: £48.1 million). This growth reflects the impact of the first full year of revenues from the SRI business acquired last year. During 2013, we made a strategic change to the provider of a low margin, legacy disposable pack service acquired with the SRI business. The new provider warranted the success of the transition but nonetheless revenues reduced by £4 million as certain contracts failed to make the transition. Operating profits were unaffected, however.

We are gearing up for the full commencement of the North Shore HSS partnership with the opening of our New York supercenter in early summer 2015, and expect that this deal will prove to be a catalyst for similar outsourcing activity in the Americas. The North Shore hospital group accounts for 35% of all surgical procedures in New York, and our contract reflects the largest outsourcing of instrument reprocessing by volume in the world.

We announced earlier this year that we were selected as preferred bidder for another large outsourcing contract worth approximately $40 million per annum, and now expect this contract to be signed shortly and begin implementation during the summer. With a bid book up by 40%, a strengthened leadership team and the launch of SynergyTrak™ and RFID technologies, the US has become one of our most exciting markets, with prospects that bode well for the future.

AST delivered consistent reported revenue of £14.2 million (2013: £14.1 million) representing a net growth of 0.2% over last year. A much stronger underlying organic growth was masked by the loss of one of our major Costa Rica customers as they withdrew a product from market. Excluding Costa Rica, reported revenue growth was 6.0%, with efficiency and process improvement driving a 9.1% adjusted operating profit growth. We have now ensured that we have a stable, diverse customer base across the rest of our network, with a particular focus on supporting the opening of our enlarged Saxonburg facility. We have gained an extremely competitive share in targeted global key accounts and have made good inroads implementing our global strategy around key multinational account retentions. We have also considerably strengthened the Americas AST leadership team in recent months, with a particular focus on business development, and the early signs of this investment are being reflected in an increase in growth.

Asia & Africa

Our Asia and Africa region continues to make steady progress. Reported revenue this year rose to £18.8 million (2013: £18.1 million), representing a growth of 3.8%. On a reported basis, adjusted operating profits declined to £3.7 million (2013: £3.9 million) but increased by 4.6% on a constant currency basis. Weakness in the margin arose from the expansion of the regional senior leadership team, as well as a change in the mix with a strong increase in HSS services.

HSS showed another year of strong organic growth of 17.3% on a constant currency basis. Our patience in this area has finally paid off, as we now are making significant progress towards the opening of three further Chinese facilities later this year, in Chengdu, Wuhan and Nanjing. We have worked to perfect our operations model in the country, understanding customer requirements and using our model of delivering services at a quality and price point the customer could not match themselves. Our Sinopharm joint marketing venture has also been delivering results in China, and we are extending this concept to other strategic partnerships with major medical device and drug distributors in Asia, in order to build gateways into established healthcare markets and to expand HSS growth. Regulatory process still hinders our progress however, as does a lack of brand awareness, and the fact that HSS outsourcing in the region is still in its formative years.

AST growth was 6.6% on a constant currency basis. Growth has been achieved from new contracts in Thailand and China, driven by US multinationals both outsourcing their sterilisation requirements and closing in-house facilities.

Unfortunately, just after the end of the fiscal year one of our gamma facilities in Malaysia suffered a fire that has resulted in the loss of the plant for the coming year. The losses are expected to be fully insured, but we are likely to suffer a small loss of revenue in the short term. We do not expect this to adversely impact the AST business' growth outcomes for the full year.

Outlook

The Board is confident that Synergy's updated strategy will build on the success we have seen in recent months with new contract wins. The continued internationalisation of our services is broadening the available market, whilst our new structure, recent appointments and new service range will contribute towards a faster rate of growth. We have a vision for how Synergy's services will integrate with the needs of the changing healthcare industry, and are actively increasing our expenditure in R&D to ensure we remain on top of technological advancements that could revolutionise our sector. Through our global expertise and investment in technology and solutions delivery we have an increasingly attractive value proposition to help our customers address the challenges that they face.

Looking ahead, our new contracts wins of £43 million per annum will be implemented over the next sixteen months, raising our growth rate. In the short to medium term we expect to see a 0.5% reduction in operating margins as we channel investment into R&D, but this investment will be offset by our growing bid books and bid conversions that will ultimately drive top-line growth. We have confidence in our strategy, and in our realigned and significantly expanded leadership team to implement our strategy.

Dr Richard Steeves

Group Chief Executive Officer

4 June 2014

FINANCE DIRECTOR'S REPORT

The business continued to progress in 2014 with reported revenue growing 5.3% to £380.5 million (2013: £361.2 million) and adjusted operating profit increasing by 9.1% to £61.3 million (2013: £56.2 million). Excluding currency effects, underlying revenue growth was 4.1%, with organic growth broadly flat. Adjusted operating margin increased by 50 basis points to 16.1%. Adjusted basic earnings per share grew by 7.6% to 70.59p.

Cash generated from operations (before non-recurring items and acquisition-related costs) increased by 2.9% to £98.0 million, reflecting a conversion of adjusted EBITDA into operating cash flow of 95%. Good cash generation reduced net debt to £147.6 million (2013: £177.3 million), representing a net debt to EBITDA ratio (for banking covenant purposes) of 1.53 times, comfortably within our limit of 3.25 times.

Adjusted operating returns on average capital employed, on an annualised basis, increased to 12.0% (2013: 11.6%).

Adjusted operating profit is stated before amortisation of acquired intangibles, non-recurring items and acquisition-related costs.

1. Income statement

Synergy's income statement is summarised below.

Table 1: Income statement

1 The effective tax rate is calculated excluding amortisation on acquired intangibles, non-recurring items and acquisition-related costs

2 Restated to reflect the amendments to IAS 19 Employee Benefits

Reported revenue of £380.5 million (2013: £361.2 million) grew by 5.3%, representing an underlying growth rate, excluding currency effects, of 4.1% over the previous year. The movement in average currency exchange rates over the last year (notably a strengthening of the Euro against Sterling), against the comparative period, has increased reported revenue by £4.2 million. Reported revenue growth excluding the linen business was 8.6%, with reported organic growth of 1.8%.

Underlying revenue, excluding currency effects, grew by 4.1%, with the UK & Ireland at 2.2%, Asia & Africa at 6.9% and the Americas at 24.5%. Europe & Middle East declined by 4.2% due to a contraction in the Netherlands linen business. Our total Americas business represented 20.5% (2013: 17.3%) of total reported revenue.

Underlying organic revenue, which excludes currency effects and the impact of acquisitions, was broadly flat, with growth of 5.9% in AST offset by a decline in the Netherlands linen business.

1.2 Gross profit

Gross profit increased by 10.7% to £155.7 million (2013: £140.7 million), representing a gross profit margin of 40.9%, an increase of 190 basis points over the previous year.

1.3 Adjusted operating profit

Adjusted operating profit increased by 9.1% to £61.3 million (2013: £56.2 million), representing an adjusted operating profit margin of 16.1%, an improvement of 50 basis points over last year. Currency effects have increased reported adjusted operating profit by £0.6 million.

1.4 Non-recurring items

Net non-recurring items and acquisition-related costs during the period were £3.3 million. £1.4 million related to acquisition transaction fees. The most significant component of this cost was £0.6 million (net of the reimbursement of costs under an exclusivity agreement) relating to an ultimately unsuccessful acquisition. Within the Netherlands, we have incurred restructuring costs of £1.8 million on the closure of two laundries and two wash centres, along with the conversion of a hospital laundry facility into a care home wash centre.

1.5 Net finance costs

The Group's net finance costs totalled £6.6 million (2013: £6.7 million), a decrease of 1.9%. The decrease reflects lower pension charges offsetting a small increase in financing costs. This year we have a higher proportion of average fixed debt against the comparative period following the issuance of additional Private Placement Notes in September 2013. The Notes incur a higher funding cost than our floating rate debt. Finance costs incorporate the impact of the amendments to IAS 19 Employee Benefits in both the current and prior period.

1.6 Adjusted profit before tax

Adjusted profit before tax was £54.7 million (2013: £49.5 million), an increase of 10.6%. The adjusted profit before tax margin increased to 14.4% (2013: 13.7%). The prior period comparative has been restated to reflect the impact of IAS 19 Employee benefits.

1.7 Amortisation of acquired intangibles

Amortisation of acquired intangibles relates to intangible assets identified on acquisitions, being the value of customer relationships and brands.

1.8 Tax

The tax charge (excluding tax on non-recurring items and on the amortisation of acquired intangibles) of £12.9 million (2013: £11.3 million) represents an effective tax rate of 23.6% (2013: 22.9%). The increase in the effective tax rate over the comparative period primarily reflects the reduction in the UK corporation tax rate and a change in the geographical mix of the Group's profits with a marginally higher proportion of profits arising in the United States compared to the previous year.

1.9 Earnings per share (EPS)

Adjusted basic earnings per share and adjusted diluted earnings per share, after adjusting for amortisation of intangibles and non-recurring items, increased by 7.6% and 8.3% respectively. After amortisation of acquired intangibles, non-recurring items and acquisition related costs, basic and diluted earnings per share increased by 9.1% and 9.8% respectively. As the Group's activities in the US increase, the Group's effective tax rate is expected to edge upwards.

Undiluted weighted average shares have increased from 57.8 million to 58.7 million in the period, primarily due to the full-year weighted impact of the placing of 2.8 million shares during 2013.

The Group's policy is to increase the total dividend each year in line with the increase in underlying earnings. The Board has proposed a final dividend of 14.20p, representing an increase on the 2013 final dividend of 10.9%, and bringing the total dividend for the year to 22.77p, growth of 10.0%. The final dividend will be paid, subject to shareholder approval, on 4 September 2014 to shareholders on the register as at 8 August 2014.

3. Cash flow

The Group cash flow is summarised below.

Table 2: Cash flow

Note: Adjusted EBITDA is earnings before interest, tax, depreciation, intangible amortisation and other non-cash items

3.1 Cash generated from operations

Cash generated from operations (before non-recurring items and acquisition-related costs) in the year increased by 2.9% to £98.0 million (2013: £95.2 million), reflecting a conversion of EBITDA into operating cash flow of 95% (2013: 96%). Free cash flow decreased by 8.3% to £55.3 million (2013: £60.3 million) owing to an unusually high cash tax refund in the prior year. Free cash flow (after the inclusion of investment capital expenditure) increased by 13.9% to £39.3 million (£34.5 million).

3.2 Interest

Net interest paid was £5.2 million (2013: £5.6 million), broadly in line with the income statement charge after the exclusion of the following non-cash charges: amortisation of facility fees, 'IAS 19 Employee Benefits' charge and costs relating to the unwinding of our cobalt disposal provision.

3.3 Tax

Tax paid was £10.2 million (2013: £4.2 million). Cash tax is in line with the equivalent income tax charge in the income statement. The prior year tax payment was lower than the current year as a result of timing differences on payments and a refund of tax paid by LEONI Studer HARD AG prior to acquisition.

3.4 Net expenditure on tangible and intangible assets

The Group has increased its investment in new capacity during the course of the year, as well as continuing to upgrade and maintain its existing infrastructure. Total net capital additions of £40.3 million (2013: £48.3 million) were made during the year.

We analyse capital expenditure between 'maintenance' and 'investment' expenditure. Maintenance capital expenditure is the capital required to sustain the revenue-generating capacity of the Group. Investment capital expenditure enhances the capacity or efficiency of the Group's capital base.

The items of necessary on-going capital expenditure are cobalt-60, the radiation source for AST gamma sterilisation plants, textiles for the linen business, and reusable surgical products. Total maintenance capital expenditure was £24.3 million, of which £10.4 million was spent on cobalt, £9.3 million on textiles and £4.6 million on reusable surgical products.

Total investment capital expenditure was £16.0 million (2013: £25.8 million), comprising £5.1 million and £1.4 million across the AST and HSS estate respectively. The remaining balance was spent on cobalt (primarily for the new Marcoule facility), property, plant and machinery, and IT (principally on our ERP platform and SynergyTrakTM development).

3.5 Purchase of treasury shares

On 6 August 2013 the Group purchased 270,500 treasury shares to partially satisfy the exercise of share options previously awarded to management under the Long Term Incentive Plan.

3.6 Proceeds from the issue of shares

Proceeds from share issues includes £1.1 million from the partner investor in relation to the initial capitalisation of the Group's 51% owned subsidiary, Chengdu Synergy Health Laoken Sterilization Co. Ltd.

3.7 Financing

The movement in financing reflects the repayment of debt on our multi-currency revolving credit facilities.

4 Acquisitions

With effect from 19 December 2013 the Group acquired the remaining 50% interest it did not own in Synergy Health Logistics B.V. from its partner for a cash consideration of €0.3 million (£0.3 million). The fee is payable in two installments; the first on completion and the second, one year hence.

On 31 January 2014, the Group acquired Genon Laboratories Ltd, a specialist food testing laboratory, for a consideration of £1.8 million (net of cash acquired), of which £0.5 million is deferred consideration. 

In the previous financial year, on 6 March 2013, the Group acquired the capital of Bizworth Gammarad Sdn Bhd ('Bizworth'), a company incorporated in Malaysia. During this financial year, deferred contingent consideration of £0.1 million was paid in accordance with the acquisition agreement.

5 Net debt and funding

5.1 Net debt

Net debt decreased in the period from £177.3 million to £147.6 million. The decrease in net debt is primarily a result of the Group's free cash generation in the period, partially offset by investment capital expenditure of £16.0 million and dividend payments of £12.8 million. The movement in the net debt is reconciled below:

Table 3: Movement in net debt

5.2 Funding

The Group has in place a 5 year unsecured multi-currency revolving facilities agreement ('the Agreement'), which was signed on 26 July 2011. The Agreement has been entered into with a group of 7 banks and comprises a Sterling denominated multi-currency facility of £105 million and a Euro denominated multi-currency facility of €130 million. On 1 June 2012 the Group signed a two year Euro denominated multi-currency facility of €18 million with the same covenants as in the July 2011 Agreement. This facility expired on 31 May 2014.

On 13 September 2012, the Group issued a bilateral private placement note of €20.6 million. At that time the Group also put in place an uncommitted shelf facility with the same lender, allowing it to draw up to $48.5 million over a 2.5 year period. The financial covenants are broadly similar to those in the Agreement. The remaining shelf facility was utilised during September 2013 when two further notes were issued, one for £10.0 million, and a second note for €25.1 million.

The Group remains comfortably within the financial covenants set out in the Agreement.

The debt is split between Sterling, Euros and US Dollars with the currency mix and level of fixed interest debt within each currency as follows:

Table 4: Composition of gross debt as at 30 March 2014

The Euro denominated debt, which is predominantly held in the UK, is held to hedge the Group's Euro denominated net assets (excluding goodwill and intangibles) of €161.1 million. The US Dollar denominated debt is held as a hedge of the Group's US Dollar denominated net assets (excluding goodwill and intangibles) of $127.4 million. As at 30 March 2014, 41% of the total debt was held at fixed rates of interest.

6 Pensions

The Group operates three final salary schemes in the UK, one in the Netherlands, two in Germany, and one in Switzerland. The Group also operates several defined contribution schemes.

In the UK the Group is required to maintain a final salary pension scheme for employees who have transferred from the NHS, which has to be acceptable to the Government Actuary's Department. With the exception of NHS transferees, the Group's defined benefit schemes are closed to new entrants and future accruals; active members have been transferred to deferred status and invited to join the Group's UK defined contribution scheme.

At 30 March 2014, the net liability arising from our defined benefit scheme obligations was £16.9 million (2013: £16.0 million) on a pension scheme asset base of £59.8 million. An increase in the deficit from the previous year end is primarily due to an increase in liabilities that is not offset by a corresponding increase in the asset base.

Table 5: Defined benefit pension schemes

Gavin Hill

Group Finance Director

4 June 2014

Consolidated income statement

For the period ended 30 March 2014

* Restated to reflect the amendments to IAS 19 Employee Benefits - see note 2.

Consolidated statement of comprehensive income

For the period ended 30 March 2014

* Restated to reflect the amendments to IAS 19 Employee Benefits - see note 2.

Consolidated statement of financial position

At 30 March 2014

Consolidated cash flow statement

For the period ended 30 March 2014

Statement of changes in equity

For the period ended 30 March 2014

* Restated to reflect the amendments to IAS 19 Employee Benefits - see note 2.

The cash flow hedging reserve debit of £664,000 (2013: £1,385,000 debit and 2012: £1,341,000 debit) represents the fair value gains and losses on hedging arrangements that are effective and qualify for cash flow hedge accounting. The brought forward reserve of £1,385,000 debit unwound during the year and revaluation of existing instruments at the balance sheet date gave rise to the closing reserve. The movement on cash flow hedges credit of £410,000 includes a £145,000 debit relating to deferred taxation. Deferred taxation relating to prior periods of £311,000 is included in transfers.

The share-based payment credit of £2,129,000 (2013: £2,545,000) includes a debit of £357,000 (2013: credit £358,000) relating to deferred taxation and a credit of £1,374,000 (2013: credit £527,000) relating to current taxation.

The movement on the treasury share reserve relates to the purchase and reissue during the year of 270,500 treasury shares, in order to partially satisfy the exercise of share options.

The accompanying accounting policies and notes form part of these financial statements.

1 General information

Synergy Health plc ('the Company') and its subsidiaries (together 'the Group') deliver a range of specialist outsourced services to healthcare providers and other customers concerned with health management. The Company is registered in the United Kingdom under company registration number 3355631 and its registered office is Ground Floor Stella, Windmill Hill Business Park, Whitehill Way, Swindon, Wilts, SN5 6NX.

The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiaries) made up to the nearest weekend to 31 March each year. The current accounting period is 52 weeks in length (2012: 52 weeks in length).

The financial statements are rounded to the nearest thousand pounds and have been prepared and approved by the Directors in accordance with International Financial Reporting Standards as adopted for use in the EU ('IFRS').

Statutory accounts for the year ended 30 March 2014 will be filed with the Registrar of Companies following the Company's Annual General Meeting. Statutory accounts for the year ended 31 March 2013 have been delivered to the Registrar of Companies. The auditors have reported on those accounts and their report was unqualified and did not contain statements under S498(2) or S498(3) of the Companies Act 2006.

2 Summary of significant accounting policies

Basis of preparation

Other than as set out below, the financial information for the period to 30 March 2014 has been prepared on the basis of the accounting policies set out in the Group's latest annual financial statements for the period ended 31 March 2013. These accounting policies are drawn up in accordance with the recognition and measurement requirements of International Financial Reporting Standards (IFRS) as adopted for use in the European Union.

Going concern

The Directors have reviewed the Group's medium-term forecasts through to June 2015 along with reasonable possible changes in trading performance and foreign currencies, to determine whether the committed banking facilities are sufficient to support the Group's projected liquidity requirements, and whether the forecast earnings are sufficient to meet the covenants associated with the banking facilities.

After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future, and have continued to adopt the going concern basis in preparing the condensed consolidated interim financial statements.

Significant accounting policies

With effect from 1 January 2013, the Group has adopted the amendments to IAS 19 Employee Benefits issued by the IASB in June 2011. This amendment has been applied retrospectively, resulting in the restatement of certain previously reported figures.

In the year ended 31 March 2013, financing income in the income statement decreased by £875,000 with a corresponding increase in the actuarial gain recognised in the statement of comprehensive income. The related deferred tax credit in the income statement increased by £201,000, with a corresponding reduction in the deferred tax credit recognised in the statement of comprehensive income.

Critical accounting estimates and judgements

The preparation of financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. Where estimates and associated assumptions are made they are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Key areas of judgement, and estimate uncertainty, are set out below.

• Impairment tests have been undertaken with respect to goodwill using commercial judgement and a number of assumptions and estimates have been made to support their carrying amounts. Sensitivity analysis as at 30 March 2014 has indicated that no reasonable foreseeable change in the key assumptions used in the impairment model will result in a significant impairment charge being recorded in the financial statements. In addition, a more detailed review has been carried out on certain Group assets, focusing on whether these assets required impairment. Following the review, no impairment was judged to be required.

• The designation of certain items of income and of cost as 'non-recurring' in nature, and their separate disclosure as such in the primary statements of the Group's consolidated accounts;

• In relation to the Group's property, plant and equipment, useful economic lives and residual values of assets have been established using historical experience and an assessment of the nature of the assets involved.

• In relation to the Group's cobalt provision, costs of future disposal are based on contractual arrangements with third parties and latest disposal cost estimates.

• The Group cobalt depreciation policy is based on the actual physical decay of the cobalt 60 isotope.

• In relation to the Group's defined benefit pension schemes, actuarial assumptions are established using relevant market benchmark data and with the advice of external qualified actuaries. Pension deficit valuations are most sensitive to changes in the underlying discount rate and inflation assumptions.

• Customer related intangibles that are acquired as part of an acquisition are valued based on the forecast discounted cash flows arising from these customers taking account of historically observed customer attrition rates

• The Group operates in a number of countries, all of which have their own tax legislation. Deferred tax assets and liabilities are recognised at the current tax rate which may not be the tax rate at which they unwind. The Group has available tax losses, some of which have been recognised and some of which have not, based upon management's judgement of the ability of the Group to utilise those losses.

3 Segmental information

The Group is organised into four operating segments, and information on these segments is reported to the chief operating decision maker ('CODM') for the purposes of resource allocation and assessment of performance. The CODM has been identified as the Board of Directors. The four operating segments are: the UK & Ireland, Europe & Middle East, Asia & Africa, and the Americas.

The segments derive their revenues from the same range of products and services - being the provision of Healthcare Services, Applied Sterilisation Technologies ('AST'), and Hospital Sterilisation Services ('HSS'). The CODM monitors the performance of the operating segments based on adjusted operating profit, being operating profit excluding the impact of amortisation on acquired intangibles and non-recurring items.

Segment information is presented below. During the period, management undertook a review of the allocation of certain reseller customers between the segments. Some customers were reallocated between segments and consequently the comparative data presented for previous periods has been restated.

3 Segmental information continued

Segment information about these divisions is presented below:

The comparative figures for the previous year are shown below.

The table below reconciles the total segment profit above, to the Group's operating profit and profit before tax:

* Restated to reflect the amendments to IAS 19 Employee Benefits - see note 2.

The table below analyses the Group's revenues from external customers between the three principal product/service groups:

IFRS 8 'Operating segments' requires the Group to disclose information about the extent of its reliance on its major customers. The Group has no single customer making up more than 10% of total revenues.

The table below analyses the Group's revenue from external customers, and non-current assets other than financial instruments, investment properties, deferred taxation and rights under insurance, by geography:

3 Segmental information continued

During the period, management undertook a review of the allocation of certain reseller customers between the UK & Ireland, Europe & Middle East, and Asia & Africa segments. Some customers were reallocated between segments and consequently the comparative data presented for previous periods has been restated.

4 Profit before tax

Profit before tax has been arrived at after charging/(crediting):

Non-recurring items of £3,254,000 (2013: £2,441,000) have been charged in arriving at operating profit. The table and accompanying notes provide further details:

Net non-recurring items and acquisition-related costs during the period were £3.3 million. £1.4 million related to acquisition transaction fees. The most significant component of this cost was £0.6 million (net of the reimbursement of costs under an exclusivity agreement) relating to an ultimately unsuccessful acquisition. Within the Netherlands, we have incurred restructuring costs of £1.8 million on the closure of two laundries and two wash centres, along with the conversion of a laundry to a wash centre.

In the prior year, non-recurring items of £2,441,000 were charged in arriving at operating profit. The table and accompanying notes provide further details:

Transaction costs incurred on the acquisition of businesses were recognised in the income statement. These costs related primarily to the acquisition of SRI. During the previous period the Group incurred costs in restructuring both SRI, and the linen business in the Netherlands. These costs related mainly to employee termination payments and property costs. The total impact of non-recurring items on profit after tax was a charge of £1,761,000. 4 Profit before tax continued

A more detailed analysis of auditors' remuneration is provided below:

The principal non-audit service was for transaction-related advisory fees, and amounted to £941,000 for the period.

5 Staff costs

The average number of monthly employees employed by the Group during the year, including Executive Directors, was as follows:

Their aggregate remuneration comprised:

Details of the Directors' aggregate emoluments can be found in the Directors' Remuneration Report.

6 Finance income

* Restated to reflect the amendments to IAS 19 Employee Benefits - see note 2.

7 Finance costs

8 Taxation

* Restated to reflect the amendments to IAS 19 Employee Benefits - see note 2.

UK corporation tax is calculated at 23% (2013: 24%) of the estimated assessable profit for the year. Taxation for overseas operations is calculated at the local prevailing rates.

A reduction in the UK corporation tax rate from 24% to 23% (effective from 1 April 2013) was substantively enacted on 5 July 2012, and further reductions to 21% (effective from 1 April 2014) and 20% (effective from 1 April 2015) were substantively enacted on 2 July 2013. This will reduce the company's future current tax charge accordingly. The deferred tax liability at 30 March 2014 has been calculated based on the rate of 20% substantively enacted at the balance sheet date.

The charge for the year can be reconciled to the profit before tax per the income statement as follows:

* Restated to reflect the amendments to IAS 19 Employee Benefits - see note 2.

9 Dividends

The Board of Directors will recommend to the shareholders a final dividend for the period ended 30 March 2014 of 14.20p (2013: 12.80p).

10 Earnings per share

* Restated to reflect the amendments to IAS 19 Employee Benefits - see note 2.

11 Property, plant and equipment

During the period ended 30 March 2014, the Group purchased tangible fixed assets with a total cost of approximately £37.7 million (2013: £48.2 million).

12 Related party transactions

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note.

One of the Group's customers owns a minority share of one of the Group's subsidiaries. During the year, revenue with this customer amounted to £309,000 (2013: £391,000). An amount payable of £428,000 is outstanding at the end of the year (2013: £422,000).

Remuneration of key management personnel

The remuneration of key personnel (including Directors) of Synergy Health plc was:

Key personnel (including Directors) comprise the Executive and Non-Executive Directors, and three senior executives (2013: five). The three senior executives comprise two executives directly responsible for two of the Group's operating regions, and the Group Company Secretary.

13 a) Acquisition of subsidiary - Genon

On 31 January 2014, the Group acquired the entire issued share capital of Genon Laboratories Limited ('Genon'), a company incorporated in England, as part of its strategy to expand the scale of its laboratory services business.

The provisional fair value of the net assets acquired and the related consideration were as follows:

The goodwill arising on the acquisition of the business is attributable to the assembled workforce and the synergies generated following the integration of Genon into the Group.

In accordance with IFRS 3 (revised) 'Business Combinations', management have made adjustments to the book value of net assets acquired to arrive at the fair values disclosed above. The most significant of these is the recognition of intangibles assets (customer lists).

Total transaction costs of £46,000 were incurred in the acquisition and were expensed within non-recurring items and acquisition-related costs. During the period, the Genon business contributed £125,000 to revenue and £55,000 to operating profit.

Summary of cash flows:

Summary of deferred consideration:

13 b) Acquisition of subsidiary - SH Logistics

As part of the acquisition of Isotron plc and its group in 2007, the Group obtained a 50% interest in a jointly-controlled entity, Synergy Health Logistics BV (previously named Isotron Logistics BV) ('SH Logistics'), whose principal activity is the provision of logistics consultancy and is incorporated and operates in the Netherlands.

On 1 April 2013, the Group purchased the remaining 50% of the issued share capital of SH Logistics from the joint venture partner.

The provisional fair value of the net assets acquired and the related consideration were as follows:

The goodwill arising on the acquisition is attributable to the assembled workforce and the synergies generated following the integration of the remaining 50% of the business into the Group.

Total transaction costs of £18,000 were incurred in the acquisition and were expensed within non-recurring items and acquisition-related costs. During the period, the Group's increased ownership of the SH Logistics business contributed £616,000 to revenue and £121,000 to operating profit.

Summary of cash flows:

Summary of deferred consideration:

13 c) Prior period acquisition of subsidiary - SRI

In the previous year, the Group acquired the entire issued share capital of SRI/Surgical Express Inc ('SRI'), a NASDAQ-listed healthcare business incorporated in Florida, as part of its strategy to enter the US HSS market. Since acquisition the company has been renamed Synergy Health North America, Inc.

The provisional fair value of the net assets acquired and the related consideration were as follows:

The goodwill arising on the acquisition of SRI is attributable to the assembled workforce and the synergies generated following the integration of SRI into the Group.

In accordance with IFRS 3 (revised) 'Business Combinations', management made adjustments to the book value of net assets acquired to arrive at the fair values disclosed above. The most significant of these was a reduction in the carrying value of property, plant and equipment and circulating inventory, where book value on acquisition was higher than fair value. In the period, no adjustments were made to provisional fair values.

The SRI business contributed £61,059,000 to revenue and £5,863,000 to operating profit for the period.

Summary of cash flows:

13 d) Prior period acquisition of subsidiary - Bizworth

In the previous financial year, the Group acquired the entire issued share capital of Bizworth Gammarad Sdn Bhd ('Bizworth'), a company incorporated in Malaysia, as part of its strategy to expand the geographic coverage of its AST business.

The provisional fair value of the net assets acquired and the related consideration were as follows:

13 d) Prior period acquisition of subsidiary - Bizworth (continued)

In accordance with IFRS 3 (revised) 'Business Combinations', management made adjustments to the book value of net assets acquired to arrive at the fair values disclosed above. The most significant of these was the recognition of intangible assets (customer lists).

In the period, adjustments were made to provisional fair values, increasing the carrying value of intangible assets and deferred tax liabilities by £323,000.

The Bizworth business contributed £307,000 to revenue and £154,000 to operating profit for the period.

Summary of contingent consideration:

14 Post balance sheet eventsOn 16 May 2014, the Group acquired the entire issued share capital of Bioster SpA, a company incorporated in Italy, gaining control of the company and its subsidiaries ('Bioster Group'). Bioster Group operates ethylene oxide and electron beam sterilisation facilities in Italy, Slovakia, and the Czech Republic, providing sterilisation services to the medical device, pharmaceutical and packaging industries. In addition, it operates a hospital sterilisation services ('HSS') business in Italy. Cash consideration amounted to €29 million net of cash and debt. In the year ended 31 December 2013, Bioster Group recorded revenues of € 20.2 million (£16.4 million), and underlying EBIT of €2.6 million (£2.1 million). The business had gross assets of €24.8 million (£20.2 million).

On 14 April 2014 the Synergy Health plant in Rawang, Malaysia experienced a mechanical equipment failure which resulted in a small fire due to product becoming overheated. The incident was fully contained. Safety is of paramount importance and we can confirm there was no risk to employees, the local community or environment at any time during this incident. The Group's financial losses are expected to be fully insured.

15 Annual report

The annual report and financial statements for the year ended 30 March 2014 will be posted to the shareholders on 26 June 2014, and will be delivered to the Registrar of Companies following the Company's Annual General Meeting.

16 Forward-looking statements

Certain statements made in this announcement are forward-looking statements. These forward-looking statements are not historical facts but rather are based on the Company's current expectations, estimates, and projections about its industry; its beliefs; and assumptions. Words such as 'anticipates,' 'expects,' 'intends,' 'plans,' 'believes,' 'seeks,' 'estimates,' and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties, and other factors, some of which are beyond the Company's control, are difficult to predict, and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. The Company cautions shareholders and prospective shareholders not to place undue reliance on these forward-looking statements, which reflect the view of the Company only as of the date of this announcement. The forward-looking statements made in this announcement relate only to events as of the date on which the statements are made. The Company will not undertake any obligation to release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances, or unanticipated events occurring after the date of this announcement except as required by law or by any appropriate regulatory authority.