Half Yearly Report

Friday 30 October 2015

SYNERGY HEALTH PLC

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

INTERIM RESULTS FOR THE SIX MONTHS ENDED 27 SEPTEMBER 2015

Synergy Health plc (LSE: SYR), a leading global provider of specialist outsourced support services to health-related markets, announces its interim results for the six months ended 27 September 2015.

Financial Highlights

· Reported revenue growth of 4.4%. Underlying revenue growth, excluding currency effects, of 6.3%

· Underlying adjusted operating profit increased by 8.8% on a constant currency basis. Adjusted operating profit1 margin increased by 10 basis points to 16.1%

· Operating cash flow increased by 9.6% to £49.1 million with cash conversion of 89%

· Special dividend of 15.8p paid on 20 October, prior to completion of the combination with STERIS Corporation ('STERIS'). No interim dividend was paid in 2014 due to the combination of Synergy and STERIS

· Costs of £18.0 million relating to the combination of Synergy and STERIS are included within non-recurring items and acquisition-related costs

· Adjusted EBITDA increased by 6.0% to £55.0 million

Operational Highlights

· Strong growth in Applied Sterilisation Technologies ('AST') with revenue up 10.3% on a constant currency basis

· Healthcare Services ('HS') revenue grew by 7.5% on a constant currency basis with contract wins of £35 million. Strong pipeline with the bid book growing by a third to £300 million

· Healthcare Solutions ('HCS') revenue declined by 1.6% on a constant currency basis. Contract wins of £4 million in the first half of the year, and a further £8 million subsequent to the half year

· Expected completion of the combination with STERIS on 2 November 2015

Outlook

· Combination with STERIS will support Synergy's growth initiative in HS, especially within the US, while the enlarged AST business will deliver global services to our shared customer base

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

CHIEF EXECUTIVE'S REVIEW

Results

It is my pleasure to report what is expected to be our last set of results as Synergy Health. We have enjoyed another strong period of growth reflecting the strength of our strategy and its implementation. Reported revenue was up 4.4% to £206.3 million (2014: £197.5 million) and up 6.3% on a constant currency basis.

During the first half of the year we have made a number of investments in new capacity across our Applied Sterilisation Technologies and HCS businesses. We have been successful at winning new contracts, totalling £47 million for HS and HCS, alongside good growth across the AST business.

Adjusted operating margin improved 10 basis points during the first half of the year. As a result adjusted operating profit increased by 5.0% to £33.1 million (2014: £31.6 million) and up 8.8% on a constant currency basis.

Adjusted basic EPS was up 16.4% to 42.41 pence (2014: 36.42 pence). Basic EPS was down 72.8% to 8.43 pence (2014: 31.02 pence) as a result of non-recurring costs incurred to complete the combination with STERIS.

Net debt at the end of the period decreased to £156.3 million. Operating cash flow was £49.1 million (2014: £44.8 million), increasing above the growth in operating profits due to good control of working capital.

Recommended Combination

We are working to complete the combination of Synergy with STERIS on 2 November 2015 in line with the revised timetable of principal events set out in the Company's announcement relating to the Scheme Court Hearing, published on 26 October 2015.

Dividend

On 1 October 2015 the Board declared a special dividend of 15.8 pence per share. This was paid on 20 October 2015 to shareholders on the register as at 9 October 2015. As a result of the proposed combination with STERIS, the Board has decided not to pay a further interim dividend, which would only have reduced the cash element to be received by Synergy shareholders under the terms of the combination with STERIS by an equal amount.

Business Line Review

Synergy is a leading provider of specialist outsourced support services to health-related markets and an international leader in the provision of outsourced sterilisation services for hospitals and medical device manufacturers. We operate in three distinct service lines:

Applied Sterilisation Technologies ('AST'), providing gamma, electron beam, X-ray and ethylene oxide contract sterilisation services to medical device manufacturers and related industries, as well as a range of technical laboratory services;

Healthcare Services ('HS'), providing a range of outsourced sterilisation services to hospital systems in the US, UK, Italy, Netherlands and China, reusable sterile gowns and drapes in the US ('RSS'), and an international products business based in the UK; and

Healthcare Solutions ('HCS'), providing healthcare linen rental services in the UK and the Netherlands.

Applied Sterilisation Technologies

Reported revenue for the period increased by 5.5% to £70.7 million (2014: £67.0 million) and up 10.3% on a constant currency basis. Adjusted operating profit was £25.2 million (2014: £23.3 million), increasing 13.6% on a constant currency basis. Operating margin was marginally higher at 35.6%. During the traditionally quieter second quarter, two European facilities were closed for capacity upgrades. Both facilities will resume operations in the second half, alongside the opening of a new electron-beam facility in Petaluma, California. The global register of opportunities now sits at £44 million, an increase of 33%, reflecting the investment we have made in our business development team and providing confidence for future growth.

Healthcare Services

Reported revenue grew by 11.0% to £92.1 million (2014: £83.0 million). Growth has been driven by the start of new contracts, partially offset by the continued rationalisation of low margin, non-core, product distribution services in the US. During the first half we won contracts with a total value of £35 million of new HS contracts. The global bid book is now standing at £300 million. Adjusted operating profit was consistent with last year at £8.7 million (2014: £8.7 million), as the business invests in an expanded operations team in advance of new instrument processing contracts.

Healthcare Solutions

Reported revenue for the linen business was £43.4 million (2014: £47.5 million). Underlying revenue for the period before adverse currency effects was down 1.6% reflecting an improved situation. During and subsequent to the period the business won new contracts worth £12 million. A number of facilities across the network are being upgraded with new automated plant and machinery that has caused some short-term disruption but will yield future capacity and productivity improvements. Operating margins were marginally lower, reducing from 7.3% to 6.8%. Adjusted operating profit was £3.0 million (2014: £3.5 million).

Synergy Team

I would like to take this opportunity to thank our team for working so diligently over the last year whilst contending with the distraction of the STERIS transaction. I am very proud of the team that we have built at Synergy and the great work that has been done creating one of the world's leaders in sterilisation and infection control services. The hard work and dedication of our employees has not only created a great business but has also had a significant impact on improving patient safety and reducing risks for our healthcare customers around the world.

Outlook

Synergy has enjoyed 24 years of unbroken growth. The combination with STERIS will further enhance the prospects for both Synergy and the enlarged Group. As I wrote last year, we now enter a new chapter in Synergy's evolution, where our access to STERIS' U.S. sales teams and infrastructure will help to accelerate the hospital sterilisation outsourcing market, and the combined global AST network will be of significant value to our shared customer base. In the USA in particular there is unprecedented demand for our Hospital Sterilisation Services where we offer a compelling proposition to hospitals seeking to cost effectively improve patient safety and regulatory compliance.I remain very excited about the opportunities at hand, and look forward to seeing continued growth of the combined organisation.

Richard Steeves

Group Chief Executive Officer

30 October 2015

FINANCE DIRECTOR'S REPORT

Overview

Our business delivered a strong first half financial performance with reported revenue growing 4.4% to £206.3 million (2014: £197.5 million) and adjusted operating profit increasing by 5.0% to £33.1 million (2014: £31.6 million). Excluding currency effects, underlying revenue growth was 6.3% and adjusted operating profit grew by 8.8%. Adjusted operating margin increased by 10 basis points to 16.1%. Adjusted basic earnings per share grew by 16.4% to 42.41p.

Strong cash generation across the business resulted in cash generated from operations (before non-recurring items and acquisition-related costs) increasing by 9.6% to £49.1 million (2014: £44.8 million), reflecting a conversion of adjusted EBITDA into operating cash flow of 89% (2014: 86%). Net debt decreased to £156.3 million from £161.1 million at the year end, representing a net debt to EBITDA ratio of 1.44 times which is comfortably within our banking covenant of 3.25 times.

Adjusted operating returns on average capital employed, on an annualised basis, increased to 12.7% from 12.4% at the year end.

1. Income statement

The Group's income statement is summarised below.

Table 1: Income statement

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

1.1 Revenue

Reported revenue of £206.3 million (2014: £197.5 million) increased by 4.4%, representing an underlying growth rate, excluding currency effects, of 6.3% over the previous year. The movement in currency exchange rates over the last year (notably a weakening of the Euro against Sterling) has depressed reported revenue by £3.6 million.

Underlying revenue, excluding currency effects, grew by 10.3% in AST and 7.5% in HSS, with a decline of 1.6% in Healthcare Solutions.

1.2 Gross profit

Gross profit was marginally higher at £87.3 million (2014: £87.0 million), representing a gross profit margin of 42.3%. The increase in gross profit was depressed by the prior period acquisition of Bioster.

1.3 Adjusted operating profit

Adjusted operating profit increased by 5.0% to £33.1 million (2014: £31.6 million), representing an adjusted operating profit margin of 16.1%, an increase of 10 basis points. Currency effects have reduced reported adjusted operating profit by £1.2 million, with growth of 8.8% on a constant currency basis.

1.4 Non-recurring items and acquisition-related costs

Non-recurring items and acquisition-related costs during the period were £17.6 million, of which £18.0 million were costs relating to the STERIS combination with the balance being a small credit from the excess of insurance proceeds for the Rawang insurance claim over and above the written down value of damaged assets.

Against the STERIS combination costs of £18.0 million we have recognised legal and transaction fees of £11.8 million, of which £7.6 million were contingent on the successful completion of the transaction. In addition, and also contingent on completion, we have recognised accelerated share option costs of £6.2 million.

1.5 Net finance costs

The Group's net finance costs before acquisition-related costs totalled £2.9 million (2014: £3.2 million), a reduction of £0.3 million against the comparative period. An acquisition-related cost of £0.4 million has been expensed in the period, relating to the accelerated amortisation of financing arrangement fees.

1.6 Adjusted profit before tax

Adjusted profit before tax was £30.2 million (2014: £28.4 million), an increase of 6.4%, (10.7% excluding currency effects). The adjusted profit before tax margin was 14.6% (2014: 14.4%), an increase of 20 basis points.

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 amortisation of acquired intangibles, non-recurring items and acquisition-related costs) of £5.3 million (2014: £6.8 million) represents an effective tax rate of 17.5% (2014: 23.9%). The reduction in tax charge compared to the prior period is largely due to the completion of a prior period tax audit, plus impact of a reduction in the main UK rate of corporation tax from 21% to 20%.

The amortisation of acquired intangibles, non-recurring items and acquisition-related costs generated a tax credit of £2.3 million, resulting in a net tax charge of £3.0 million (2014: £6.3 million). This represents an effective tax rate (after amortisation of acquired intangibles, non-recurring items and acquisition-related costs) of 38.4% (2014: 25.4%). This increase in the overall effective tax rate is caused by some of the costs relating to the combination with STERIS not being deductible for tax.

1.9 Earnings per share

Adjusted basic earnings per share and adjusted diluted earnings per share, after adjusting for amortisation of intangibles and non-recurring items and acquisition-related costs, increased by 16.4% and 15.3% respectively. After amortisation of acquired intangibles, non-recurring items and acquisition-related costs, basic and diluted earnings per share decreased by 72.8% and 73.1% respectively, due to costs relating to the STERIS combination.

Year on year, undiluted weighted average shares have increased from 58.9 million to 59.1 million.

On 1 October 2015 the Board declared a special dividend of 15.8 pence per share. This was paid on 20 October 2015 to shareholders on the register as at 9 October 2015.

3. Cash flow

The Group's 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 9.6% to £49.1 million (2014: £44.8 million), reflecting a conversion of EBITDA into operating cash flow of 89% (2014: 86%).

3.2 Interest

Net interest paid was £2.6 million (2014: £3.0 million).

3.3 Tax

Tax paid was £4.4 million (2014: £2.9 million). The increase against last year was because of a tax refund in the comparative period.

3.4 Net expenditure on tangible and intangible assets

The Group continued to invest in new capacity during the period, as well as upgrading and maintaining its existing infrastructure. Total net capital additions of £29.6 million (2014: £31.9 million) were made during the period.

We analyse capital expenditure between 'maintenance' and 'investment' expenditure. Maintenance capital expenditure is the capital required to replace the existing capital base. 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 £11.9 million (2014: £13.8 million), of which £5.3 million related to cobalt-60, £5.1 million to textile linen and £1.5 million to reusable surgical products in the US.

Total investment capital expenditure was £17.7 million (2014: £18.1 million). Total expenditure in AST was £11.9 million, including £3.0 million on our new pallet irradiator in Bradford, £1.3 million on increasing processing capacity within the gamma facilities in the Netherlands, £1.8 million on a new electron beam in Italy and £2.5 million on our new electron beam facility in Petaluma, California. Expenditure of £1.2 million on the new North Shore facility in New York was the largest component of investment in HS. Investment in upgrading plant and machinery that improves productivity and lifts capacity in our linen facilities in the UK and selected sites in the Netherlands results in total investment in the Linen business of £2.5 million.

4 Net debt and funding

4.1 Net debt

Net debt decreased in the period from £161.1 million at the end of March 2015 to £156.3 million. The movement in the net debt is reconciled below:

Table 3: Movement in net debt

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

On 13 September 2012, the Group issued a bilateral private placement note of €20.6 million. The Group at that point 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 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 financial covenants are broadly similar to those 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 27 September 2015

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 €187.9 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 $191.6 million. As at 27 September 2015, 40% of the total debt was held at fixed rates of interest.

5 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 27 September 2015, the net liability arising from our defined benefit scheme obligations was £16.2 million (29 March 2015: £20.3 million) on a pension scheme asset base of £68.2 million. A reduction in the deficit from the year end is primarily due to a fall in liabilities following an increase in the discount rate.

Table 5: Defined benefit pension schemes

Gavin Hill

Group Finance Director

30 October 2015

Condensed consolidated income statement

For the period ended 27 September 2015

Condensed consolidated income statement

Consolidated statement of comprehensive income

Consolidated statement of financial position

Consolidated cash flow statement

Condensed consolidated statement of changes in equity

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

Notes to the financial statements

1 General information

Synergy Health plc ('the Company') and its subsidiaries (together 'the Group') deliver a range of specialist outsourced services to health-related markets. The Company is registered in England and Wales under company registration number 3355631 and its registered office is Ground Floor Stella, Windmill Hill Business Park, Whitehill Way, Swindon, Wiltshire, SN5 6NX.

These condensed consolidated interim financial statements were approved for issue by the Board of Directors on 30 October 2014.

2 Summary of significant accounting policies

Basis of preparation

These condensed consolidated interim financial statements of the Group are for the six months ended 27 September 2015.

The condensed consolidated interim financial statements have been prepared on the basis of the accounting policies set out in the Group's latest annual financial statements for the period ended 29 March 2015. 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.

The information for the period ended 29 March 2015 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. A copy of the statutory accounts for that period has been delivered to the Registrar of Companies. The auditors' report on those accounts was (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.

The condensed consolidated interim financial statements for the six months to 27 September 2015 have not been audited or reviewed by auditors pursuant to the Auditing Practices Board guidance on Review of Interim Financial Information.

Going concern

The Directors have reviewed the Group's medium-term forecasts through to October 2016 along with reasonable possible changes in trading performance and foreign currencies. The Directors have also reviewed the funding arrangements put in place by STERIS to support the Group should the proposed combination proceed.

Absent the proposed combination with STERIS, elements of the Group's committed banking facilities would fall due for renewal in July 2016. The Directors have good reasons to believe that they would be renewed.

The purpose of these reviews has been for the Directors to determine whether, with or without the proposed combination with STERIS, committed banking facilities would be available sufficient to support the Group's projected liquidity requirements, and whether the forecast earnings would be sufficient to meet 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

The condensed consolidated interim financial statements have been prepared under the historical cost convention except that derivative financial instruments are stated at their fair value. Except as described below, the accounting policies adopted in the preparation of the condensed consolidated interim financial statements are the same as those followed in the preparation of the Group's annual financial statements for the period ended 29 March 2015.

3 Statement of compliance

These condensed consolidated interim financial statements have been prepared and approved by the Directors in accordance with International Accounting Standard (IAS) 34 'Interim Financial Reporting' as adopted by the EU (adopted IAS 34) and with the Disclosure and Transparency Rules of the UK Financial Services Authority. These condensed consolidated interim financial statements have not been audited or reviewed by the Group's auditors in accordance with International Standard on Review Engagements 2410 issued by the Auditing Practices Board. They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group as at and for the period ended 29 March 2015.

4 Financial risk management

The primary risks arising from the Group's financial instruments are interest rate risk, foreign currency risk, credit risk and liquidity risk. These risks and the Group's financial risk management objectives and policies are consistent with that disclosed in the consolidated financial statements as at and for the period ended 29 March 2015.

5 Estimates (continued)

The preparation of the condensed consolidated interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. Except as described below, in preparing these condensed consolidated interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation and uncertainty were the same as those that applied to the consolidated financial statements as at and for the period ended 29 March 2015.

During the 6 months ended 27 September 2015, management reassessed its estimates in respect of actuarial assumptions in relation to the Group's defined benefit pension schemes using professional advice and relevant market benchmark data for discount rates and inflation.

6 Segmental information

The Group is organised into three operating segments: Applied Sterilisation Technologies and Laboratory Services ('AST'), Healthcare Services ('HS'), and Healthcare Solutions ('HCS').

Information on these segments is reported to the chief operating decision maker ('CODM') for the purposes of resource allocation and assessment of performance. The chief operating decision maker has been identified as the Board of Directors. 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.

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

6 Segmental information continued

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 revenue.

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

7 Non-recurring items and acquisition-related costs

In the period to 27 September 2015, non-recurring items of £18 million have been charged in arriving at operating profit. The table and accompanying notes provide further details:

In the period to 28 September 2014, non-recurring items of £594,000 were credited in arriving at operating profit. This included costs of £285,000 related to acquisition transaction fees and a £932,000 cessation gain on a component of the Group's retirement benefit obligations.

In the year to 29 March 2015, non-recurring items of £5,812,000 were charged in arriving at operating profit. £4,515,000 related to acquisition transaction fees. The most significant component of this cost was £2,900,000 relating to the proposed combination with STERIS. Operational and restructuring costs were £2,510,000 million, primarily relating to the settlement of prior period claims and facility closure costs in the Dutch Linen business.

8 Tax

8 Tax (continued)

The Group's effective tax rate for the period on earnings before non-recurring items and the amortisation of acquired intangibles is 17.5% (2014: 23.9%). The reduction in the rate compared to the prior period is due to the completion of a tax audit, with no

material adjustment required. Excluding the impact of the tax audit the recurring tax rate over the full year would have been 23.4% (2014: 23.9%). UK corporation tax is calculated at 20% (2014: 21%) of the estimated assessable profit for the year. Taxation for overseas operations is calculated at the local prevailing rates.

Tax credits of £2.2m arose in respect of amortisation of acquired intangibles and non-recurring items (2014: £0.5m). This represents an effective overall tax rate (after amortisation of acquired intangibles and non-recurring costs) of 38.4% (2014: 25.4%). This increase in overall effective tax rate is due to some of the non-recurring costs related to the recommended combination between Synergy Heath and STERIS not being deductible for tax.

A number of changes to the UK corporation tax system were announced in the Chancellor's Budget on 8 July 2015. These include reductions to the main rate of corporation tax to reduce the rate to 19% from 1 April 2017 and to 18% from 1 April 2020. As the changes had not been substantively enacted at the balance sheet date their effects are not included in these financial statements. The changes are not expected to have a material impact on the Group's deferred tax balances.

9 Dividends

No dividend (interim or final) was paid for the year ended 29 March 2015. On 20 October 2015 the Directors paid an interim dividend for the year ending 3 April 2016 of 15.80 pence (2014: nil).

10 Earnings per share

11 Provisions

The cobalt disposal provision recognises a potential decommissioning liability in respect of certain types of cobalt used in some of the Group's AST sites. It is anticipated that the provision will be utilised as the cobalt to which the provision relates reaches the end of its useful economic life. Other provisions include provisions against vacated properties and other restructuring costs.

12 Property, plant and equipment

During the period ended 27 September 2015, the Group purchased assets with a total cost of approximately £31.2 million(28 September 2014: £32.9 million).

13(a) Prior period acquisition of subsidiary - Bioster

On 15 May 2014, the Group acquired the entire issued share capital of Bioster S.p.A. and associated companies ('Bioster').

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.

The 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 Bioster into the Group.

In accordance with IFRS 3 (revised) Business Combinations management have made adjustments to the local book values of net assets acquired to arrive at the fair value disclosed above. The most significant of these adjustments include the recognition of intangible assets (customer lists), the recognition of deferred taxation liabilities, and the application of IFRS to the recognition of assets under finance leases and the associated finance lease liabilities.

Total transaction costs of £530,000 were incurred in the acquisition of Bioster Group and were expensed within non-recurring items and acquisition-related costs.

During the period, the Bioster Group contributed £8,238,000 to revenue and £1,212,000 to operating profit.

Summary of cash flows:

13(b) Prior period acquisition of subsidiary - IDtek

On 3 November 2014, the Group acquired 70% of the issued share capital of IDtek Track-and-Trace SA ('IDtek'), a company incorporated in Switzerland, gaining control of the company and its subsidiaries. IDtek provides RFID-led solutions to a wide range of industries including energy and automotive sectors, and it is our intention to utilise its expertise and intellectual property to develop new services for the healthcare market.

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 synergies generated following the integration of IDtek into the Group, and has been allocated to the HS segment.

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.

Total transaction costs of £111,000 were incurred in the acquisition and were expensed within non-recurring items and acquisition-related costs.

Summary of cash flows:

Summary of cash flows:

Summary of deferred consideration

14 Post balance sheet events On 2 October the shareholders of Synergy Health plc voted to approve the combination of Synergy and STERIS Corp.

On 20 October 2015 the Directors paid an interim dividend for the year ending 3 April 2016 of 15.80 pence (2014: nil).

On 26 October all outstanding Synergy share options vested, and for non-SAYE options were exercised and converted to Synergy shares on the same day, according to the option-holders' instructions. Also on the 26 October, trading on the London Stock Exchange in Synergy shares was suspended.

On 28 October, a hearing took place at the High Court where all outstanding Synergy shares were cancelled, barring only the one share held by New STERIS Limited.

There were no other material events subsequent to the year end and up to 30 October 2015, the date of approval of the Financial Statements by the Board.

Forward-looking statementsCertain information included in this announcement is forward-looking and involves risks, assumptions and uncertainties that could cause actual results to differ materially from those expressed or implied by forward-looking statements. Forward-looking statements cover all matters which are not historical facts and include, without limitation, projections relating to results of operations and financial conditions and the Company's plans and objectives for future operations, including, without limitation, discussions of expected future revenue, financing plans, expected expenditures, risks associated with changes in economic conditions, the strength of the markets in the jurisdictions in which the Group operates, and changes in exchange and interest rates. Forward-looking statements can be identified by the use of forward-looking terminology including terms such as "believes", "estimates", "anticipates", "expects", "forecasts", "intends", "plans", "projects", "goal", "target", "aim", "may", "will", "would", "could", or "should" or, in each case, their negative or other variations or comparable terminology. Forward-looking statements are not guarantees of future performance. All forward-looking statements in this announcement are based upon information known to the Company on the date of this announcement. Accordingly, no assurance can be given that any particular expectation will be met and readers are cautioned not to place undue reliance on forward-looking statements, which speak only at their respective dates. Additionally, forward-looking statements regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Other than in accordance with its legal or regulatory obligations (including under the UK Listing Rules and the Disclosure and Transparency Rules of the Financial Services Authority), the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Nothing in this announcement shall exclude any liability under applicable laws that cannot be excluded in accordance with such laws.

Statement of Directors' Responsibilities

We confirm that to the best of our knowledge:

• the condensed consolidated interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU; and,

• the interim management report includes a fair review of the information required by:

(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

This report has been approved by the Board of Directors and signed on its behalf by:

Richard Steeves

Chief Executive

30 October 2015

The condensed consolidated interim financial statements for the six months ended 27 September 2015 will be available on the Company's website on 30 October 2015.

Registered office: Synergy Health plc, Ground Floor Stella, Windmill Hill Business Park, Swindon, Wiltshire SN5 6NXWebsite: www.synergyhealthplc.com