Final Results

SYNERGY HEALTH PLC

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

PRELIMINARY RESULTS FOR THE TWELVE MONTHS ENDED 31 MARCH 2013

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 31 March 2013.

Financial Highlights

·; Strong reported revenue growth of 15.8%

·; Underlying revenue growth, excluding currency effects, up 18.5%

·; Adjusted operating profit* margin minimally diluted by the SRI acquisition, down by 0.1% to 15.6% (2012: 15.7%)

·; Operating cashflow* increased 12.0% to £95.2 million (2012: £85.0 million)

·; Adjusted EBITDA increased 13.2% to £99.3 million (2012: £87.7 million)

·; Net debt increased to £177.3 million (2012: £173.5 million), reflecting recent debt-funded acquisitions and currency movements

·; Total dividend up 15%, in line with growth in adjusted earnings

Operational Highlights

·; Strong bid books in US Hospital Sterilisation Services ('HSS') business, with good conversion to preferred bidder status

·; Following the acquisition of SRI, cost leadership and the launch of improved services have delivered margin targets earlier than expected

·; In China we have signed a marketing agreement with Sinopharm. Our second HSS facility is due to open early 2014

·; Third gamma irradiation facility operational in Malaysia, following Government outsourcing

·; X-ray technology supporting good Applied Sterilisation Technologies ('AST') growth in Europe & Middle East of 24.8%

·; Marcoule construction completed and sterilisation of customer products expected to commence late summer 2013

·; Focus on margin improvement in UK & Ireland region

·; Strengthening of regional management teams as approximately a quarter of revenue is generated in the Americas and Asia & Africa regions

Outlook

·; Good opportunities in Asia and the Americas support strong focus on these two regions

·; Entry into US HSS market expected to support growth rates

·; Optimistic that our strategy to expand internationally will sustain current growth rates

Richard Steeves, Chief Executive of Synergy Health, said:

"Synergy is a global leader in outsourced sterilisation services for medical device manufacturers, hospitals and other industries. Synergy also provides other niche outsourced services, such as healthcare linen, pathology, and specialist laboratory services. All of our businesses have the benefit of significant barriers to entry, stable long-term contracts, and good cash generation."

"Synergy will continue to implement its strategy to develop its services internationally with a particular focus on Asia and the Americas. Throughout the year the number of business development opportunities has increased significantly, and as a result the Board is confident that Synergy will enjoy another successful year of growth in line with its objectives."

*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.

Further information:

There will be a meeting for analysts at 9.30am today, 5 June 2013, at Investec Bank (UK) Ltd, 2 Gresham Street, London EC2V 7QP.

For further information:

CHAIRMAN'S STATEMENT

STRONG PERFORMANCE WITH NEW GROWTH OPPORTUNITIES

I am pleased to report that Synergy has delivered a strong set of results for the year ended 31 March 2013. Our planned expansion into the United States healthcare market has proved to be well timed, offsetting a tough economic environment in Europe. We have visibility of an unprecedented number of business development opportunities, with good growth prospects in all of our regions, particularly Asia & Africa and the Americas.

We have a clear focus to recruit, train and develop talented, diverse and highly motivated people at every level of the Group, in line with our stated strategy to differentiate ourselves through our people. During the second half of the year we have taken steps to strengthen our regional leadership in Europe & the Middle East and in Asia & Africa, and we have begun enhancing our team in the Americas, where accelerated growth is anticipated.

The results detailed in this report demonstrate that Synergy goes into the next financial year well placed to continue to deliver sustainable growth into the future.

Results

Synergy has delivered strong full year growth in 2013, with reported revenue of £361.2 million (2012: £312.0 million), representing an increase of 15.8%. Underlying revenue growth after removing the impact of currency movements was 18.5%. Adjusted operating profit was £56.2 million (2012: £49.0 million), representing an increase of 14.8%. Underlying operating profit growth was 18.3%. Adjusted operating margin decreased slightly to 15.6% (2012: 15.7%), reflecting the initially dilutive effect of SRI/Surgical Express Inc ('SRI'), our US acquisition.

Consistent with previous years, gains and losses associated with the acquisition and disposal of businesses were recognised within 'non-recurring items and acquisition-related costs'. In addition we have restructured our Dutch linen business, closing and consolidating one facility, with further rationalisation expected in the coming year. The combined effects of the acquisitions and the restructuring costs resulted in non-recurring items and acquisition-related costs of £2.4 million. After taking account of amortisation, non-recurring items and acquisition-related costs, profit before tax increased by 19.6% to £38.8 million (2012: £32.5 million).

Shareholder return

Driven by the growth in revenue, adjusted basic earnings per share before intangibles, amortisation, non-recurring items and acquisition-related costs amounted to 66.75p (2012: 60.32p), an increase of 10.7%. After taking account of amortisation, non-recurring items and acquisition-related costs, basic earnings per share were 54.17p (2012: 44.51p), an increase of 21.7%.

An interim dividend of 7.90p per share (2012: 6.82p) was paid to shareholders on 14 December 2012. The Board is proposing a final dividend of 12.80p, which together with the interim dividend would give dividends for the year totaling 20.70p (2012: 18.00p) representing a 15.0% increase. If approved at the Annual General Meeting on 25 July 2013, the dividend will be paid on 5 September 2013 to shareholders on the Register of Members at 9 August 2013.

Business Development and Acquisitions

Synergy continues to invest in strategic opportunities, and completed the acquisition of SRI during the year for a cash consideration (excluding debt) of £15.3m. The purchase of SRI, a NASDAQ-listed service provider of sterile gown rental, instrument set rental and instrument processing services, has provided Synergy with scale, broad market access and infrastructure in an attractive core service market.

During the year we continued to invest in additional capacity across the business, completing significant capital projects to meet increased customer demand in Malaysia, France, the USA and Costa Rica.

Further details of these acquisitions and investments are disclosed in the Regional Review, and in note 14 to these preliminary results. Our strategy of growing key industry sectors through acquisitions is unchanged, and with our solid financial position we will continue to consider targeted bolt-on acquisitions and to evaluate strategic acquisitions to increase shareholder value.

The Board

As Chairman of the Board, I am responsible for ensuring its effective management and processes. I have set out my commitment to excellence in governance in the Annual Report's Corporate Governance Report. The Board takes its Corporate Governance responsibilities seriously, and I can confirm that the Board is compliant with the principles of the UK Corporate Governance Code relating to leadership and effectiveness. The Board also continues to ensure that there is clear distinction between the Board and the Executive leadership of the Company, led by the Chief Executive Officer Dr Richard Steeves.

On 7 June 2012 Robert Lerwill retired as Non-Executive Chairman from the Board. On behalf of the Board I would like to thank Robert for the seven years of service he gave to Synergy. The Board plans to review its membership during the year, taking into account the Group's strategy of expanding internationally. A formal international search process is underway to recruit an additional fully independent Non-Executive Director to further strengthen the Board and support the Group.

The Board has always recognised the paramount importance of having a wide range of views reflected at Board level, and the Group's commitment to diversity and the blend of the right skills and experience is shown in the composition of the Board, where women currently comprise forty percent of its members. The Board expects the Group to be in a position to maintain this level of representation when renewing Board membership over the coming years.

Detailed terms of reference for the Board and its committees clearly set out their respective responsibilities. There continues to be a rigorous and transparent procedure for the appointment of new Directors. The effectiveness of the Board, its committees and Directors, is assessed annually through a formal evaluation process. Further details of how we have applied the principles of the Code in this regard are set out in the Annual Report's Corporate Governance Report and the Directors' Report.

Corporate responsibility

The Group operates both ethically and responsibly in all areas of our business. Our core values of integrity, innovation, accountability and achievement are critical 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 the Annual Report's Operating Review.

Our people

Synergy's growth and success revolves first and foremost around the quality and commitment of our people and the shared values to which we all subscribe. On behalf of the Board, I would like to thank our employees in all areas of the Group for their hard work and dedication over the past year.

I would also like to welcome new arrivals to the Group: those who are just starting their careers, those who have moved to Synergy for personal development and those who have joined us through acquisition.

Outlook

Overall 2012/13 was a year of significant progress with our rapid expansion in the United States. The opportunities in this market, together with the recent developments in China, create exciting opportunities for growth in the coming years. Whilst we still have to contend with tough markets, particularly in Europe, Synergy has an excellent leadership team that leaves it well positioned to cope with all challenges, and turn our development opportunities into sustainable growth. As we start the new financial year, the Board is confident about the period ahead. We will continue to implement our strategy and continue our journey of creating a world-class outsourcing business for health-related markets.

Sir Duncan Nichol

Chairman

5 June 2013

CHIEF 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 technologies, including in Switzerland the world's first pallet x-ray irradiator. Synergy also provides other niche outsourced services, such as healthcare linen, pathology, and specialist laboratory services. All of our businesses have the benefit of significant barriers to entry, stable long-term contracts, and good cash generation.

At the start of the year the Group was faced with the continued economic slowdown in Europe and the UK, a deteriorating market for healthcare linen services in the Netherlands as a result of extreme price competition, and currency headwinds driven by the devaluation of the Euro. To offset these challenges the Board decided to bring forward Synergy's entry into the Hospital Sterilisation Services ('HSS') market in the United States, and this well-timed move has resulted in a solid outcome for the year with reported revenue growth of 15.8% to £361.2m and growth in adjusted operating profit of 14.8% to £56.2m, with stable operating margins.

Synergy has made two HSS acquisitions in the United States; firstly in March 2012 with the acquisition of MSI Surgical Solutions LLC ('MSI') in New York. This single processing facility gave Synergy its first insights into the local market, and has since been fully integrated into the Americas region. Our second HSS acquisition was SRI/Surgical Express Inc ('SRI') , in July 2012, and whilst this business had been loss-making for some time, our experience led us to believe that the business could be restructured to drive profitable growth. The acquisition has proved to be a great success. A swift integration of the business into the region, together with the application of Synergy's expertise, has resulted in a quick return to profitability and more recently, to renewed revenue growth. With ten facilities plus distribution hubs, SRI has provided the region with the scale and infrastructure necessary to launch a national outsourcing service for HSS services in a market worth more than $2 billion per annum. From the initial launch a bid book of $60 million per annum was quickly built and just under half of this book has been converted to preferred bidder status in recent months. These new HSS opportunities, together with a return to growth in the wider SRI business, set the stage for a period of good growth from this region.

We are also making good progress in our other regions with business development activities at an all time high, and what appears to be a cessation of the extreme price competition in the Dutch linen market after we declared a change of strategy in February. To ensure that we capitalise on global opportunities the Board has been actively strengthening regional management teams, with the appointment of several senior leaders including a new regional managing director in Europe & the Middle East, new regional finance directors in Europe & the Middle East, Asia & Africa, and the Americas, and a new global business development director for our Applied Sterilisation Technology business ('AST'), based in the United States. We are also recruiting a new regional Chief Executive Officer for the Americas, who we expect to appoint by the end of the second quarter. As a result of these developments we believe that 2013/14 will mark an inflexion point for Synergy with a return to stronger organic growth with sustainable margins.

Looking across the regions, our strategy to broaden our international reach continues to gather momentum. Asia & Africa and the Americas now account for 22.7% of revenue compared with 9.8% last year, and with the expansion of these regions we expect their share of revenue to continue to increase. Our medium term objective is to have 50% of the Group's revenue derived from outside of the UK and Europe.

Synergy is in good shape with an internationally diversified business providing high value-added services underpinned by long-term contracts. Cash generation has been excellent, increasing by 12.0% to £95.2 million (2012: £85.0 million), reducing gearing to 1.8 times EBITDA which is well below our internal ceiling of net debt to EBITDA of 2.5 times.

Strategy

Our core service is the provision of outsourced sterilisation for medical device manufacturers via our AST business, and for healthcare providers such as acute hospitals via our HSS business. In addition we are leading providers of sterile linen services in the UK and the Netherlands, manufacturers of infection control products and providers of specialist laboratory services.

The growth of our AST business has been a priority and this is reflected in global reported revenue for this service up 12.5% to £107.3 million (2012: £95.4 million). Excluding SRI, HSS revenue increased by 9.7% to £68.9 million (2012: £62.8 million) whilst healthcare linen revenue declined by 8.1% at £103.0 million (2012: £112.0 million) as a result of price deflation in the Netherlands and currency effects. Our healthcare products business continues to improve; it contributed £1.3m to operating profit, although revenue declined by 12.8% to £36.4 million (2012: £41.7 million), reflecting further product rationalisation and a focus on profitability.

Our objective is to grow revenue and earnings by approximately 15% per annum through a combination of organic and acquisitive growth. Our strategy is to continue to internationalise our services, competitively differentiate Synergy through our people, maintain cost leadership and focus on value-added services with high barriers to entry. The Board reviews Synergy's strategy annually and assesses progress on implementation. At our most recent review we concluded that we could improve our organic growth by building on our testing laboratories in Europe and the UK and broadening their reach. This action, alongside continued internationalisation of our core business streams, will improve Synergy's level of organic growth as well as accelerate a targeted improvement in our operating return on capital employed.

Regional Review

Synergy operates its business as four geographic regions covering the global market. The structure provides the depth and resilience necessary to operate a geographically diverse business, as well as providing responsive leadership as close to the customer as possible. The strategy to internationalise continues to play an important role, protecting the Group against economic uncertainties in Europe whilst providing opportunities for growth in the faster growing Asia & Africa and Americas regions.

UK & Ireland

The UK & Ireland region has experienced a challenging year with limited revenue growth, reflecting the difficult economy and the continued drought in new HSS contracts. In addition, our decision to prioritise operating profit and cash generation for our healthcare businesses reduced headline growth rates. Reported revenue was flat at £158.1 million (2012: £158.3 million) although on a constant currency basis revenue was up 0.6%. A higher proportion of AST and HSS revenue, coupled with careful cost control, has resulted in an increase in operating profit of 20.2% to £34.0 million (2012: £28.3 million), with margins increasing 3.6% to 21.5% (2012: 17.9%).

Our UK & Ireland AST business grew by 1.9% with a marked slowdown at the start of the year and an impact from the devaluation of the Euro. On a constant currency basis, revenue growth was 4.6%. The region continues to show modest levels of growth, reflecting the wider UK and Irish economies. Some capacity expansion has been added in Thorne, where two additional ethylene oxide chambers have been commissioned, but it is unlikely that market demand would support increased capacity in the region.

Our UK & Ireland HSS business grew by 7.1% reflecting the full year effect of the Lincoln and Grimsby services started last year, as well as modest growth in patient volumes. Bidding activity for new outsourced service opportunities has improved but the period required for NHS decision-making remains stubbornly long.

Healthcare linen services grew by 0.9%, which is aligned with our strategy to focus on margin rather than growth. However, the service has won two NHS contracts which have been outsourced for the first time, expanding the available market and supporting a slightly higher rate of growth in the new financial year. Our UK products business finished the year in a much stronger position in terms of profitability, but saw revenue fall 14.9% as a result of continued rationalisation of products. Some of the domestic revenue loss has been offset by strong growth in international sales where the business is concentrating its efforts.

Europe & the Middle East

Europe has continued to be a challenging market for Synergy because of the region's economic issues, the extreme price competition in the Dutch healthcare linen market, and currency headwinds.

Reported revenue for Europe & the Middle East was down 1.8% to £121.0 million (2012: £123.3 million). On a constant currency basis, revenue grew 4.4%. Operating profit declined 13.6% to £16.8 million (2012: £19.5 million) with margins decreasing 1.9% to 13.9%.

The reduction in the regional growth rates and margin reflects price erosion in the Dutch linen business, which became particularly intense in the third quarter of the year. Linen revenue declined 10.9% (5.0% on a constant currency basis). We have redoubled our efforts to reduce operating costs and this has led to the closure and consolidation of one facility, with further rationalisation expected in the coming year. In the fourth quarter we announced our intention to withdraw from heavy price discounting and reinstate prices to a level that would allow the business to maintain an acceptable return. As a result of our change in strategy, price competition appears to have eased and we now look forward to improved stability and a more rational pricing environment in the coming year. It may however take a further two to three years to fully restore margins, as the most recent lower margin contracts are typically of three years' duration.

Our AST business showed solid growth of 24.8% (32.7% on a constant currency basis), supported by the acquisition of our new x-ray facility in Daniken, Switzerland. Underlying organic growth, excluding acquisitions and the impact of currencies, was just over 10%.

Construction has been completed on our new gamma radiation and research facility in Marcoule, developed in collaboration with the Commissariat à l'énergie atomique et aux energies alternatives (CEA). In addition to providing sterilisation services to medical device manufacturers Synergy will be providing testing services for nuclear, space, radiation waste and packaging companies. It was intended that Marcoule would open in September 2012 and contribute to the organic growth rate, but the final licensing and approvals have been delayed and we expect the facility to open late this summer.

Despite the tough economic environment in Europe, demand for AST services has remained robust and with the continued expansion of Daniken and Marcoule we expect to see growth continue in the coming year.

We have continued to look for opportunities to expand our HSS business in Europe, but we have not made the progress we had hoped for. This lack of progress in part has resulted in a refresh of the management team, with the appointment of both a new regional managing director (reporting to the Regional CEO) and a new regional finance director, and the creation of a new regional board. Virtually all of our competitors in the European HSS sector are loss-making so we recognise there are challenges to overcome, but we still believe that this significant market can be unlocked.

Asia & Africa

The Asia & Africa region continues to present us with promising opportunities for sustained growth, but has experienced a slight pause this year as the new regional Chief Executive Officer has taken the time to strengthen his team with several new appointments, and review the strategy to ensure we maximise the potential of the business.

Reported revenue in Asia & Africa was up 12.8% to £19.7 million (2012: £17.4 million) with good growth across the region. On a constant currency basis revenue was up 13.7%. Operating profit increased by 9.5% to £4.2 million (2012: £3.8 million) with operating margins down 0.7% to 21.3% as a result of the expanding regional team and a new development office in Hong Kong.

Our AST operations in the region grew 10.9%, somewhat slower than in previous years, reflecting capacity constraints. To address these limitations a new ethylene oxide line has opened in Malaysia, together with a third gamma radiation facility that was outsourced by the Government's nuclear institute. We are investing in our gamma radiation facility in Thailand to increase its processing capacity, and in China we are adding additional warehousing to our Suzhou facility to allow further growth. Our development team is actively looking for other growth opportunities, including potential new facilities in China, Japan and Australia.

Our HSS business grew by 22.4% in the year, showing continued growth of new business at the Suzhou facility. A new HSS facility in Chengdu will come on stream early 2014. The new service for China's largest new private finance hospital build in Shanghai is expected to open in 2015. Whilst the development team has a solid bid book for new projects, we have looked at the possibility of accelerating progress in partnership with Sinopharm, which is a Hong Kong listed, State Owned Enterprise in the pharmaceutical distribution market. Synergy signed a joint marketing agreement in February and is now jointly marketing the outsourcing service in six cities in China. If the marketing programme is successful we believe that the agreement with Sinopharm will be broadened to cover the whole of China.

Americas

Our other most promising region for growth is the Americas. The United States is the world's largest market for the manufacture and consumption of medical devices. The acquisition of SRI together with the much smaller MSI acquisition have given Synergy scale and stature in the region.

Reported revenue was up significantly to £62.4 million (2012: £13.0 million). Organic growth on a constant currency basis was 15.8%. Operating profit increased by 127% to £7.3 million (2012: £3.2 million). Operating margins declined by 13.0% to 11.7%, as a result of the dilution impact of SRI which was loss-making on acquisition.

A great deal of attention has been devoted to the SRI acquisition to turn the business around and lay the foundations for the launch of a revised HSS outsourcing service and the relaunch of the reusable surgical gown service (RSS). Profitability was achieved in early Q3 with steady progress made throughout the remainder of the year, almost reaching the 18 month target for 10% margins within nine months. A cost leadership programme supported by Synergy's expertise has improved operations considerably, and consolidating and relocating our America regional headquarters to SRI's offices in Tampa, Florida, has further lifted margins.

The new HSS and RSS businesses have now been launched and show much promise for a period of sustainable growth. The HSS service quickly created a $60 million per annum outsourcing bid book, whilst the instrument rental programme AccuSet created a $12 million per annum bid book. Around $26 million of the outsourcing and $2 million of the AccuSet bid books have converted to preferred bidder status and we expect this level of activity and conversion rates to be maintained for the immediate future. The RSS business has been completely redesigned with the launch of new high-tech lightweight surgical gowns from Medline Industries. The RSS business also includes the provision of custom procedure packs; in recent weeks we have entered into a partnership with Medline Industries to supply these custom packs, whilst at the same time moving towards the launch of a Medline-branded reusable gown service. These two developments will leverage Medline's strong 300-plus sales team and will help to lift RSS growth rates. In the meantime the RSS bid book has grown to $8 million per annum with approximately $3 million having converted to contracts in the current financial year.

The core AST business in the US market performed very well growing by 16.7%, although growth has been offset by the temporary loss of a major customer in Costa Rica that has had to rectify its products under an FDA directive. The difficulties in Costa Rica also held back margins although we expect this to be corrected in the current financial year. With this year's growth the US AST business has become capacity-constrained, and as a result we will be extending the capacity of our Saxonburg facility, to be operational in the summer of 2014. In addition we continue to evaluate options for further facility development in Mexico and Central America.

A new regional board has been established for the Americas, led by the Group Chief Executive Officer on an interim basis. The recruitment of a permanent regional Chief Executive Officer has started, with an appointment expected towards the end of the second quarter of the current year.

Outlook

Synergy will continue to implement its strategy to develop its services internationally with a particular focus on Asia and the Americas. To ensure the implementation of the strategy creates sustained growth we have significantly enhanced the senior management team in most regions with more experienced leaders with international experience. Throughout the year the number of business development opportunities has increased significantly, and whilst a conversion to contract takes time, we start the new financial year with a spirit of optimism. As a result the Board is confident that Synergy will enjoy another successful year of growth in line with its objectives.

Dr Richard Steeves

Group Chief Executive Officer

5 June 2013

FINANCE DIRECTOR'S REPORT

Our business delivered a good financial performance in 2013 with reported revenue growing 15.8% to £361.2 million (2012: £312.0 million) and adjusted operating profit increasing by 14.8% to £56.2 million (2012: £49.0 million). Excluding currency effects, underlying revenue growth was 18.5% (1.0% organic). Adjusted operating margin declined by 10 basis points to 15.6% owing to a small dilution effect from the SRI acquisition. Adjusted basic earnings per share grew by 10.7% to 66.75p.

Cash generated from operations (before non-recurring items and acquisition-related costs) increased by 12.0% to £95.2 million, reflecting a conversion of adjusted EBITDA into operating cash flow of 96%. Funding for acquisitions increased net debt to £177.3 million, representing for banking covenant purposes a net debt to EBITDA ratio of 1.76 times, comfortably within our covenant limit of 3.25 times.

Adjusted operating returns on average capital employed, on an annualised basis, increased to 11.6% (2012: 11.5%). Excluding the net assets of Marcoule, which is expected to open in late summer this year, ROCE rose to 11.7%.

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

1.1 Revenue

Reported revenue of £361.2 million (2012: £312.0 million) grew by 15.8%, representing an underlying growth rate, excluding currency effects, of 18.5% over the previous year. The movement in currency exchange rates (notably the weakening of the Euro against Sterling), against the comparative period, has reduced reported revenue by £8.3 million.

Underlying revenue, excluding currency effects, grew across all our business segments, with the UK & Ireland at 0.6%, Europe & Middle East at 4.4%, Asia & Africa at 13.7% and the Americas AST business by 15.8%. Our total Americas business, with the inclusion of MSI from the beginning of the financial year and SRI from 13 July 2012, represented 17.3% (2012: 4.2%) of total reported revenue.

Underlying organic revenue, which excludes currency effects and the impact of acquisitions, increased by 1.0%. The UK & Ireland region grew by 0.6%, Europe & Middle East contracted by 1.3%, with Asia & Africa and the Americas growing by 13.7% and 10.8% respectively. Our main service lines continue to experience good underlying organic growth, with AST growing by 8.9% and HSS by 6.4%. A fall in revenue at our healthcare linen business in the Netherlands resulted in a small contraction of total Europe & Middle East revenue.

1.2 Gross profit

Gross profit increased by 13.1% to £140.7 million (2012: £124.4 million), representing a gross profit margin of 39.0%, a decrease of 90 basis points over the previous year due to the dilution effect of the SRI acquisition.

1.3 Adjusted operating profit

Adjusted operating profit increased by 14.8% to £56.2 million (2012: £49.0 million), representing an adjusted operating profit margin of 15.6%, a small reduction of 10 basis points over last year due to the small dilution effect of the SRI acquisition. The margin remained at last year's level excluding currency effects. Currency effects have reduced reported adjusted operating profit by £1.7 million. Excluding the impact of SRI, adjusted operating margin increased to 16.5% (2012: 15.7%).

1.4 Non-recurring items

Net non-recurring items and acquisition-related costs during the period of £2.4 million primarily relate to acquisition transaction fees and restructuring costs for and following the acquisition of SRI, as well as restructuring costs incurred in the Netherlands linen business, partly offset by a gain on the disposal of an investment property, and a cessation gain on a defined benefit pension scheme.

1.5 Net finance costs

The Group's net finance costs totalled £5.9 million (2012: £5.6 million), an increase of £0.3 million. The principal reason for this increase is additional loans raised to finance acquisition activity. The average interest rate of the Group's debt is approximately 2.8%.

1.6 Adjusted profit before tax

Adjusted profit before tax was £50.3 million (2012: £43.4 million), an increase of 16.0%. The adjusted profit before tax margin remained constant at 13.9% (2012: 13.9%).

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. The increase relates to intangibles recognised on the acquisitions of SRI, LSH and MSI.

1.8 Tax

The tax charge (excluding tax on the amortisation of acquired intangibles, and on non-recurring items and acquisition-related costs) of £11.5 million (2012: £9.9 million) represents an effective tax rate of 22.9% (2012: 22.7%). 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. Following the acquisition of SRI, a greater proportion of the Group's profit now arises in the United States, which has a higher tax rate than the current Group average. This impact is partially offset by an increase in profit generated in Switzerland and Ireland, which have lower tax rates than the Group's average. As the Group's activities in the United States increase, the Group's effective tax rate is expected to edge upwards.

1.9 Earnings per share (EPS)

Adjusted basic earnings per share and adjusted diluted earnings per share, after adjusting for amortisation of acquired intangibles, non-recurring items and acquisition-related costs, increased by 10.7% and 10.5% respectively. After amortisation of acquired intangibles, non-recurring items and acquisition related costs, basic and diluted earnings per share increased by 21.7% and 21.5% respectively.

Undiluted weighted average shares have increased from 55.3 million to 57.8 million in the period, primarily due to the placing of 2.8 million shares in June 2012.

There has been a significant change to the pension accounting rules ('IAS 19 revised'), which will affect the Group's 2014 results and require restatement of 2013 comparative figures.

The change will principally require pension interest return to be calculated using the value of scheme assets multiplied by the discount rate, rather than by the expected rate of asset return. Had IAS 19 revised been adopted early for the 2013 results, the estimated impact would have been to reduce adjusted pre tax profit by £0.8 million and to reduce EPS by 1.00 pence. This accounting change has no impact on cash flows or on the pension deficit.

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 12.80p, representing an increase on the 2012 final dividend of 14.5%, and bringing the total dividend for the year to 20.70p, growth of 15.0%. The final dividend will be paid, subject to shareholder approval, on 5 September 2013 to shareholders on the register as at 9 August 2013.

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 12.0% to £95.2 million (2012: £85.0 million), reflecting a conversion of EBITDA into operating cash flow of 96% (2012: 97%). Free cash flow increased by 32.8% to £60.3 million (2012: £45.4 million).

3.2 Interest

Net interest paid was £5.6 million (2012: £5.1 million), broadly in line with the charge in income statement.

3.3 Tax

Tax paid was £4.2 million (2012: £13.0 million). Cash tax is lower than the equivalent income tax charge in the income statement and the prior year cash payment, as a result of timing differences on payments and a refund of tax paid by LSH prior to acquisition. In accordance with the acquisition agreement, the refund amount was owed to the previous owners, as it arose due to the change in ownership. The refund was included in the deferred contingent consideration recognised at the time of acquisition. Following the Swiss tax authorities' agreement of the final acquisition tax assessments, the deferred contingent consideration was paid in October 2012.

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 £48.3 million (2012: £49.8 million) were made during the year. On a like-for-like basis, excluding SRI, total net capital additions were £41.1 million (2012: £49.8 million).

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 £22.5 million (2012: £18.8 million), of which £9.2 million was spent on cobalt, £11.0 million on textiles, and £2.3 million on SRI reusable surgical products. Excluding SRI, total maintenance expenditure was £20.2 million (2012: £18.8 million).

Total investment capital expenditure was £25.8 million (2012: £31.0 million), of which £10.6 million relates to the construction of new AST facilities, with the remaining balance spent on cobalt, property, plant and machinery, and IT (principally on our ERP roll-out and TrakStar development). Of the £10.6 million incurred on the construction of new AST facilities and the expansion of existing ones, £4.3 million was spent on our new gamma facility in Marcoule, France, £1.4 million on two new ethylene oxide chambers in Thorne and £2.8 million on an additional electron beam facility in Costa Rica and the ethylene oxide facilities in Costa Rica and Oldsmar, Florida. We incurred one-off expenditure this year of £4.4 million purchasing previously rented surgical instruments for the SRI business.

Our ERP project continues to progress well, with a good proportion of the business now running on the new platform. The project provides a new standardised financial system across the Group, as well as replacing the AST operating systems within the integrated ERP environment. The project has been extended to all our recently acquired sites, including SRI, and is expected to be largely complete by the end of the 2013/14 fiscal year.

This level of capital expenditure is expected to remain broadly constant into next year, as we continue to carefully control capital expenditure across the enlarged Group.

3.5 Pre-acquisition liabilities

Pre-acquisition liabilities of £6.1 million are composed of a £3.3 million pre-acquisition dividend paid to LEONI AG in respect of the LSH acquisition, and a £2.8 million contractual payment of a non-utilised environmental provision to the former owners of LIPS Textielservice Holdings BV.

3.6 Financing

The movement in financing resulted primarily from increased borrowing to fund the Group's acquisition of SRI.

3.7 Proceeds from Share Issue

On 7 June 2012, the Group raised £22.4 million by way of an equity placing. The proceeds were used to maintain a strong balance sheet, following recent acquisitions. A further £1.8 million was raised as proceeds arising from the exercise of share options.

4 Acquisitions

With effect from 13 July 2012, the Group acquired SRI, a NASDAQ-listed healthcare business for a cash consideration of £15.3 million (US$ 24.0 million). Including debt, total consideration paid was £25.5 million (US$ 40.0 million). Intangible assets arising on the acquisition have been recognised at £0.5 million and will be amortised on a straight-line basis over their expected lives. The acquisition gave rise to goodwill of £0.2 million.

On 19 March 2012, the Group acquired LSH from LEONI AG. During the period, deferred consideration of £0.3 million (CHF 0.4 million), and deferred contingent consideration of £2.4 million (CHF 3.7 million) were paid, the latter relating to a tax refund caused by the change in ownership.

On 7 April 2011, the Group acquired BeamOne LLC. During the period, deferred contingent consideration of £10.5 million (US$ 16.4 million) was paid. The acquisition gave rise to goodwill of £14.4 million.

5 Net debt and funding

5.1 Net debt

Net debt increased in the period from £173.5 million to £177.3 million. The increase in net debt is primarily a result of the Group's acquisitions in the period. 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 the 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.

On 13 September 2012, the Group issued a bilateral private placement note of €20.6 million. The Group has 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 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 in each currency as follows:

Table 4: Composition of gross debt as at 31 March 2013

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 €140.4 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 $129.3 million. As at 31 March 2013, 23% 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, one 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 31 March 2013, the net liability arising from our defined benefit scheme obligations was £16.0 million (2012: £18.3 million) on a pension scheme asset base of £57.8 million. A decrease in the deficit from the year end reflects a fall in the expected inflation rate that more than offsets a reduction in the discount rate.

The triennial actuarial valuation of the three UK schemes was completed during the year with an assessed actuarial deficit of £20.1 million at 31 March 2012. A new programme of deficit recovery payments was agreed with the Trustees, comprising an increase of £0.3 million in annual recovery payments, from £2.1 million to £2.4 million, increasing each year by 3% until 2020.

Table 5: Defined benefit pension schemes

Gavin Hill

Group Finance Director

5 June 2013

Consolidated income statement

For the period ended 31 March 2013

Consolidated statement of comprehensive income

For the period ended 31 March 2013

Consolidated statement of financial position

At 31 March 2013

Consolidated cash flow statement

For the period ended 31 March 2013

Statement of changes in equity

For the period ended 31 March 2013

The cash flow hedging reserve of £1,385,000 debit (2012: £1,341,000 debit and 2011: £112,000 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 £1,341,000 debit unwound during the year and revaluation of existing instruments at the balance sheet date gave rise to the closing reserve. The share-based payment credit of £2,545,000 (2012: £2,052,000) includes a credit of £358,000 (2012: debit £325,000) relating to deferred taxation and a credit of £527,000 (2012: credit £420,000) relating to current taxation.

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 31 March 2013 will be filed with the Registrar of Companies following the Company's Annual General Meeting. Statutory accounts for the year ended 1 April 2012 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 Basis of accounting

Other than as set out below, the financial information for the period to 31 March 2013 has been prepared on the basis of the accounting policies set out in the Group's latest annual financial statements for the period ended 1 April 2012. 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.

3 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.

• 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 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.

• 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 31 March 2013 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 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.

4 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 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:

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.

4 Segmental information continued

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:

5 Profit before tax

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

Non-recurring items of £2,441,000 (2012: £3,476,000) have been charged in arriving at operating profit. The table and accompanying notes provide further details:

Transaction costs incurred on the acquisition of businesses have been recognised in the income statement. These costs relate primarily to the acquisition of SRI. This acquisition is disclosed in more detail in note 14.

During the 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 is a charge of £1,761,000.

In the previous year, non-recurring costs of £3,476,000 were charged in arriving at operating profit. The table and accompanying notes provide further details:

Transaction costs incurred on the acquisition of businesses have been recognised in the income statement. These costs relate primarily to the acquisition of four businesses: BeamOne, Sterilgamma, LSH, and MSI. These acquisitions are disclosed in more detail in note 14. The total impact of non-recurring items to profit after tax in the prior year was a charge of £3,393,000.

5 Profit before tax continued

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

6 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:

7 Finance income

8 Finance costs

9 Taxation

UK corporation tax is calculated at 24% (2012: 26%) 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 26% to 25% (effective from 1 April 2012) was substantively enacted on 5 July 2011, and further reductions to 24% (effective from 1 April 2012) and 23% (effective from 1 April 2013) were substantively enacted on 26 March 2012 and 3 July 2012 respectively. This will reduce the company's future current tax charge accordingly. The deferred tax liability at 31 March 2013 has been calculated based on the rate of 23% substantively enacted at the balance sheet date.

The March 2013 Budget announced that the rate will further reduce to 20% by 2015 in addition to the planned reduction to 21% by 2014 previously announced in the December 2012 Autumn Statement. It is expected that these changes will be substantively enacted in June or July 2013.

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

10 Dividends

The Board of Directors will recommend to the shareholders a final dividend for the period ended 31 March 2013 of 12.80 pence (2012: 11.18 pence).

11 Earnings per share

12 Property, plant and equipment

During the period ended 31 March 2013, the Group purchased tangible fixed assets with a total cost of approximately £48.2 million (2012: £51.0 million).

13 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 £391,000 (2012: £468,000). An amount payable of £422,000 is outstanding at the end of the year (2012: £1,131,000).

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

Key personnel (including Directors) comprise the Executive and Non-Executive Directors and five senior executives (2012: six). The five senior executives comprise three executives directly responsible for three of the Group's operating regions, the Group Commercial Director, and the Group Company Secretary.

14 a) Acquisition of subsidiary - SRI

With effect from 13 July 2012, 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 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 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 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, adjustments were made to provisional fair values, decreasing previously reported goodwill by £156,000.

Total transaction costs of £434,000 were incurred in the acquisition of SRI and have been expensed within non-recurring items and acquisition-related costs.

The SRI business contributed £45,682,000 to revenue and £4,297,000 to operating profit for the period. Had the business been owned for the entire year, the contribution to revenue and operating profit would have been £64,800,000 and £3,107,000 respectively.

Summary of cash flows:

14 b) Acquisition of subsidiary - Bizworth

With effect from 6 March 2013, 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 our AST business.

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

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 only adjustment made was the recognition of intangible assets (customer lists).

Total transaction costs of £27,000 were incurred in the acquisition of Bizworth and have been expensed within non-recurring items and acquisition-related costs. The Bizworth business did not contribute to revenue or operating profit for the period, and, as a new venture, would not have contributed revenue or operating profit even had the business been owned for the entire year.

Summary of cash flows:

Summary of contingent consideration:

14 c) Prior period acquisition of subsidiary - MSI

In the previous financial year, on 21 March 2012, the Group acquired the entire issued share capital of MSI Surgical Solutions LLP ('MSI'), a company incorporated in the US, as part of its strategy to enter the US HSS market. Since acquisition the company has been renamed Synergy Health New York, LLC.

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

The goodwill arising on the acquisition of MSI is attributable to the assembled workforce and the synergies that can be generated following the integration of MSI 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 were the recognition of intangible assets (customer lists). In the period, adjustments were made to provisional fair values, increasing previously reported goodwill by £51,000.

Total transaction costs of £32,000 were incurred in the acquisition of MSI and were expensed within non-recurring items and acquisition-related costs. The MSI business contributed £2,390,000 to revenue and £546,000 to operating profit for the period.

Summary of cash flows:

14 d) Prior period acquisition of subsidiary - LSH

In the previous financial year, on 19 March 2012, the Group acquired the entire issued share capital of LEONI Studer Hard AG ('LSH'), an AST business incorporated in Switzerland, as part of its strategy to expand the geographic coverage of its AST business. Since acquisition the company has been renamed Synergy Health Daniken AG.

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

The goodwill arising on the acquisition of LSH is attributable to the assembled workforce and the synergies that can be generated following the integration of LSH into the Group, and to gaining access to new sterilisation technologies.

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 were the recognition of intangible assets (customer lists), the recognition of prospective tax assets, and a provision for dividends declared prior to acquisition. In the period, adjustments were made to provisional fair values, increasing previously reported goodwill by £1,173,000.

During the period, the outstanding amounts payable for both deferred consideration (£260,000) and deferred contingent consideration (£2,434,000) were paid.

Total transaction costs of £193,000 were incurred in the acquisition of LSH and were expensed within non-recurring items and acquisition-related costs. The LSH business contributed £7,393,000 to revenue and £1,811,000 to operating profit for the period.

Summary of cash flows:

Summary of contingent consideration:

14 e) Prior period acquisition of subsidiary - Sterilgamma

In the previous financial year, on 11 July 2011, the Group acquired the entire issued share capital of Sinagama II Technologies Sdn Bhd ('Sterilgamma'), a company incorporated in Malaysia, as part of its strategy to expand the geographic coverage of its AST business. Sterilgamma operates from a number of applied sterilisation technology plants across Malaysia. Since acquisition, the company has been renamed Synergy Sterilisation KL (M) Sdn Bhd.

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

The goodwill arising on the acquisition of Sterilgamma is attributable to the assembled workforce and the synergies that can be generated following the integration of Sterilgamma 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 were the recognition of intangible assets (customer lists) and adjustments to the carrying value of assets not deemed to be recoverable. In the period, no adjustments were made to provisional fair values.

Total transaction costs of £34,000 were incurred in the acquisition of Sterilgamma and were expensed within non-recurring items and acquisition-related costs.

The Sterilgamma business contributed £3,819,000 to revenue and £2,032,000 to operating profit for the period.

Summary of cash flows:

14 f) Prior period acquisition of subsidiary - GSP

With effect from 1 November 2010, the Group acquired the entire issued share capital of Gamma Service Producktbestrahlung GmbH ('GSP'), a company incorporated in Germany. An amount of £560,000 relating to deferred consideration payable was paid in the year.14 g) Prior period acquisition of subsidiary - BeamOne

In the previous financial year, on 7 April 2011, the Group acquired all of the members' interests of BeamOne LLC ('BeamOne'), an AST business incorporated in the US, as part of its strategy to expand the geographic coverage of its AST business. BeamOne operated from sites in San Diego, California; Denver, Colorado; Lima, Ohio; Saxonburg, Pennsylvania; and a fifth site in Costa Rica. Since acquisition the company has been renamed Synergy Health AST, LLC.

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

The acquisition of BeamOne was included as a post balance sheet event in the 3 April 2011 financial statements. When presenting this note, a number of estimates were made before the completion of a fair value exercise, which were subsequently replaced with fair value figures in the 2011 interim financial statements. The acquisition gave rise to goodwill of £14.4 million, attributable to the assembled workforce and the synergies that can be generated following the integration of BeamOne 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 were the recognition of intangible assets (customer lists) and adjustments to the carrying value of property restitution provisions. In the period, no adjustments were made to provisional fair values.

Total transaction costs in prior period were covered by accruals booked within non-recurring items in the previous year. The deferred contingent consideration payable was settled during June 2012. The BeamOne business contributed £14,149,000 to revenue and £2,583,000 to operating profit for the period.

Summary of cash flows:

Summary of contingent consideration:

15 Annual report

The annual report and financial statements for the year ended 31 March 2013 will be posted to the shareholders on 27 June 2013, 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.