The Annual Report - Altro

The Annual Reportand

Consolidated Financial Statementsof

The Altro Group plc

for the year ended31 December 2013

Company Registration Number: 01493087

Company Registration Number: 01493087 • The Altro Group plc 1

Contents

Page 3 Chairman’s statement

4 Strategic report

5 Directors’ report

8 Independent auditors’ report

11 Directors and advisers

12 Consolidatedprofitandlossaccount

13 Consolidated statement of total recognised gains and losses

13 Reconciliation of movements in Group shareholders’ funds

14 Consolidated balance sheet

15 Company balance sheet

16 Consolidatedcashflowstatement

16 Reconciliation of cash to movement in net funds

17 Notestotheconsolidatedfinancialstatements

43 Fiveyearfinancialsummary

45 Notice of Annual General Meeting

The Altro Group plc • Company Registration Number: 014930872


Chairman’s statementfor the year ended 31 December 2013

The results for the year ended 31 December 2013 showsalesof£111.6million[2012:£112.3million]andaprofitbeforetaxof£9.4million[2012:£10.0million].Despitethecompetitivetradingenvironment, the board decided to continue to invest heavily in research and development, manufacturing and marketing to facilitate the developmentandlaunchofnewproducts.Taking all this into account, the result is regarded assatisfactory.

The Group’s cash balance remains positive, despitesignificantexpenditureoncapitalprojects.

Witheffectfrom31March2014,theDefinedBenefitPensionScheme(closedtonewmembersin2005)wasclosedtofutureaccrual.ADefinedContribution Scheme has been offered to all DefinedBenefitSchememembers.

Aninterimdividendof4.5ppershare[2012:4.5p]waspaidtoshareholdersinNovember2013.Atthe Annual General Meeting in June, the Group proposes to seek the approval of shareholders to payafinaldividendof9.0ppershare[2012:9.0p]onFriday18July2014tothoseshareholdersonthe register at close of business on Friday 27 June 2014.Thetotaldividendwillthereforebe13.5pper share for the year to 31 December 2013 [2012:13.5p].

A share valuation of 555p wasobtainedfromInvestecBankplcinApril2014[April2013:475p,October2013:467p]onbehalfofthetrusteesoftheEmployeeBenefitTrust(EBT)andtheShareIncentivePlan(SIP).

TheGroupcontinuestosupportshareownershipbyemployeesandhassetaside£320,000[2012:£320,000]forthedistributionofsharesthroughtheSIPin2014.

TheCompanywillseektheapprovalofshareholders at the Annual General Meeting for thepurchaseofupto£1millionofitsownsharesat555ppershare.TheShareRepurchaseScheme,togetherwiththeEBT,providesamarketforshareholderswhilstreducingthedilutionofshares in issue resulting from the allotment of sharestoemployees.

We are delighted to report that the Group has again been recognised as one of The Sunday Times ‘100 Best Companies to Work For’ in 2013 fortheeighthconsecutiveyear,whichisamajorachievement.Onbehalfoftheboardandtheshareholders, I thank all employees for their continuingcontribution.

Theuncertaintiesinallpartsoftheworldcontinuetomakeforecastingchallengingbut,withnewproductsbeinglaunchedbybothdivisions,weexpectsustainablegrowthforthefuture.

David J Kahn


Strategic reportfor the year ended 31 December 2013

Principal activities and review of the businessThe Altro Group plc is an unquoted public limited company and the holding company of the Altro group ofcompanies.Itsbalancesheetisdisclosedonpage15andtheprofitattributabletoitsshareholdersisdisclosedinnote8onpage22.

The principal activities of the business are the manufacture andmarketingof:

• Altrosafetyflooring• AltroWhiterockwallandceilingsystems• Altro resin systems• AutoglymvehiclecareandKanorcarwashproducts.

Duringtheyear,theGroupanditssubsidiariesworkedtoincrease its market presence and market share in the UK and internationally for the Altro and Autoglym product ranges.Allareasofthebusinesshavecontributedtotheresultfortheyearandarewellplacedtobuildonthispositionduring2014.

Financial reviewTheconsolidatedprofitandlossaccountfortheyearissetoutonpage12.

Thekeyperformanceindicators(KPIs)fortheGroupare:

• Turnover–decreaseof0.6%[2012:up2.7%]• Operatingprofit–decreaseof10.1%[2012:up15.9%]• Netfunds–decreaseof33.2%[2012:down39.2%]• Shareholders’funds–decreaseof5.6%[2012:down5.1%]

TheGroup’snetfundsasat31December2013were£4.6million[2012:£6.9million].

TheperformanceagainstKPIsisconsideredsatisfactorygiventheoveralleconomicenvironmentinourmarkets.

Expenditureduringtheyearhasincludedinvestmentinbuildings, plant and machinery throughout the Group aswellasadditionalcontributionsof£1.75milliontotheDefinedBenefitPensionScheme.Suchexpenditureisaclearexampleofourpolicyofinvestingforthefuture.

Principal risks and uncertaintiesThemanagementofthebusinessandtheexecutionofthe Group’s strategy are subject to a number of risks and theGrouphasproceduresandsystemstomanagethese.

The key business risks affecting the Group are considered to relate to competition from other manufacturers, increasedrawmaterialandenergycosts,regulatorychanges,fluctuationsintheUKandglobaleconomyandanyactionwhichmaybetakenbygovernmentsinourmajormarketstoaddresstheirbudgetdeficits.

Theboardtakesactionwherepossibletoeliminate,reduceormitigatespecificrisksthroughtheadoptionofappropriatestrategies.

Financial risk management TheGroup’soperationsexposeittoavarietyoffinancialrisks, including the effects of changes in currency exchangerates,creditexposure,liquidityandinterestrates.

Given the size of the Group, the directors have not delegatedtheresponsibilityofmonitoringfinancialriskmanagementtoasub-committeeoftheboard.Thepolicies set by the board of directors are implemented by theGroup’sfinancedepartment.

ThemainrisksarisingfromtheGroup’sfinancialmanagementcanbeanalysedasfollows:

Currency riskTheGroupisexposedinitstradingoperationstotheriskoffluctuationsincurrencyexchangerates.Whereappropriate,forwardcontractsandswapsareusedtohedgethisexposure.

Credit riskTheGroup’sprincipalfinancialassetsarebankbalances,stockandtradedebtorswhichrepresenttheGroup’smaximumexposuretocreditriskinrelationtofinancialassets.Riskismanagedthroughinternalmonitoringprocessesandcreditinsurance,bothofwhichhavebeengivengreaterfocusbecauseofdifficulttradingconditions.

Price riskTheGroupisexposedtopriceriskonrawmaterialsasaresultofitsoperationsandsuchexposureismonitoredcloselyandreportedonregularly.Inthemajorityofcases,dualsupplyarrangementsareinplace.

Liquidity riskTheGrouphaspositivecashbalanceswithvariousbanksandappropriateoverdraftfacilitiesinplacewhereconsiderednecessary.

Interest rate riskTheGrouphasverylimitedexposuretointerestrateriskasborrowingsarenotsignificant.However,thereisanexposuretotheimpactoflongertermratemovementsintheDefinedBenefitPensionScheme,whichismanagedbythetrusteesoftheSchemeandtheiradvisers.

Approved by the Board of Directors and signed on behalf oftheBoard.

E P BoyleSecretary14May2014


Directors’ reportfor the year ended 31 December 2013

The directors present their report and the audited consolidatedfinancialstatementsofTheAltroGroupplc(“theCompany”)-CompanyRegistrationNumber:01493087-anditssubsidiaryundertakings(together,“theGroup”)fortheyearended31December2013.ThedirectorsoftheCompany,allofwhom(exceptDr G Cleverdon) have been directors during the year anduptothedateofsigningthefinancialstatements,are listed on page 11.DrCleverdonresignedasadirector on 30 June 2013 and retired after 27 successful yearswiththeCompany.

Share capitalDuring 2013, the Group bought back and cancelled 56,880[2012:131,983]ordinarysharesof10peach(representing0.3%[2012:0.8%]ofthecalledupsharecapital)atapriceof475ppershare[2012:506ppershare]foratotalof£270,180[2012:£667,833]withanominalvalueof£5,688[2012:£13,198].

TheGroupwillseekapprovalattheAnnualGeneralMeetingtocommitupto£1milliontobuyingbackGroupshares[2012:£1million].ThisisthetwentiethyearinwhichtheGrouphasruntheShareRepurchaseSchemeforthebenefitofallshareholders.

DividendsThedirectorsrecommendafinaldividendof9.0ppershare,resultinginatotaldividendof13.5ppersharefortheyear.Basedonthenumberofsharesinissueatthedateofthisreport,thiswouldequatetoafinaldividendof£1,569,373.Thetotaldividendpaidintheyearwas13.5ppershare.Dilutedearningspersharewere38.3p[2012:42.1p].AssumingapprovalbyshareholdersattheAnnualGeneralMeeting,thefinaldividendwillbepaidonFriday18July2014toallthoseon the share register at close of business on Friday 27June2014.

Share Incentive Plan (SIP)£320,000hasbeenallocatedtotheSIP[2012:£320,000forsharesawardedto458employees].ThisallocationwillbethetwelfthundertheSIP.

Employee Benefit Trust (EBT)Shares continue to be purchased by the EBT for use in theGroupshareschemes.ThefinancialresultsoftheEBTareincorporatedintotheconsolidatedfinancialstatementsoftheGroup.

Phantom share option schemeIn 2005 the Company introduced a phantom shareoptionscheme.Thiswasdesignedtorewardparticipatingseniorstafftothesameextentasthe1996UnapprovedSeniorStaffShareOptionSchemebutwithoutthenecessityofallottingsharesonexerciseofanaward.TherulesofthePhantomShare Option Scheme 2005 state that no phantom options may be granted after 31 December 2008

unless shareholder approval has been granted for itsrenewal.ShareholderapprovalwasreceivedattheAnnualGeneralMeetingin2008toextendtheScheme for three years to 31 December 2011 and in June2011toextendtheschemeforthreeyearsto31December2014.TheCompanywishestocontinueto grant phantom options and therefore a resolution willbeputtotheAnnualGeneralMeetingauthorisingitsextensionforafurtherthreeyearsto31December2017.

EmployeesThe Group operates non-discriminatory employment policieswhicharedesignedtoattract,retainandmotivate the very best people, recognising that this can only be achieved through offering equal opportunities regardless of age, disability, gender, race, religion, colour, nationality, marital status and sexualorientation.

Applications for employment by disabled persons are alwaysfullyconsidered,bearinginmindtherespectiveaptitudesandabilitiesoftheapplicantconcerned.

In the event of members of staff becoming disabled, every effort is made to ensure that their employment withtheGroupcontinuesandthatappropriatefacilitiesareavailableandtrainingisarranged.It is the policy of the Group that the training, career development and promotion of a disabled person should, as far as possible, be identical to that of a personwhodoesnotsufferfromadisability.

StaffareencouragedtoplantheircareerswithintheGroup and to participate in appropriate ongoing training,consistentwiththeneedsofthebusiness.

Alldivisionsdeveloptheirowninternalcommunications and employees receive regular updatesontheGroup’sstrategies,policiesandresults.

The Group has taken appropriate steps during the financialyeartointroduce,maintain,ordeveloparrangements aimed at consulting employees or their representativesonaregularbasissothattheviewsof employees can be taken into account in making decisionsthatarelikelytoaffecttheirinterests.

Oursuccessisduetotheteamworkandco-operationofthepeoplewithintheGroup.Thedirectorsthankallthosewhohaveworkedsohardandcontributedsomuch to achieve these results during a demanding time.TheGroupcontinuestodevelopandmaintainaculturewhichencourageslongserviceandweareproudthatsomanyemployeeschoosetoremainwithusovermanyyears.


Health & Safety and the environmentHealth&Safetyandenvironmentalperformanceremainkeybusinessobjectives.

Our Manufacturing and Sustainability efforts are centred on making proactive, tangible improvements, whichtranslateintorealbenefitsfortheenvironmentandsavingsforthebusiness.

Research and developmentResearch and development remains at the forefront of our vision for the future and our strength and depth in thisareaareessentialpartsofourbusiness.Allresearchanddevelopmentexpenditureischargedtotheprofitandlossaccountasincurred.

Group pension schemesThe future of our pension schemes is underpinned by theknowledgethatastrongandsuccessfulGroupshould ensure that pension obligations can be met todayandinthefuture.

FollowingaperiodofconsultationwithcurrentactivemembersoftheDefinedBenefitPensionSchemethedecisionwastakentoclosetheSchemetofutureaccrualfrom31March2014.Allcurrentactivemembers have become deferred members and the linktofinalsalaryhasbeenbroken.

Thiswasnotaneasydecision;however,itwasconsidered necessary to protect the Group from furthervolatilitywhileallowinggreaterfocusonfundingtheexistingSchemedeficitandprotectingthebenefitsbuiltupinthepast.DuringtheyeartheGroupmadeacontributionof£1.75milliontotheSchemeinlinewiththetriennialfundingplanagreedwiththePensionTrusteesin2011.

EmployeeswhowerepreviouslymembersoftheDefinedBenefitSchemehavebeenofferedmembershipofaDefinedContributionScheme.Employeeswhodonotcontributetoapensionwillbeincludedintheauto-enrolmentprocess.

Payments to suppliersGroupcompaniesdonotfollowanypublishedcodeor standard on payment practice for suppliers of goodsandservices.However,inrespectofregularsuppliers, our policy is generally to establish agreed paymenttermswhichapplytorecurringtransactions,subjecttoreviewasappropriate.Foroccasionalsuppliers,thepolicyistopayinaccordancewithprevailing practice for that particular country and industryormarket,subjecttoanyspecificagreement.The Company acts as a holding company for the Group.CreditordaysfortheCompanywerenil[2012:nil]asitdoesnotundertakeanytransactionswithsuppliers.TheGroup’screditordayswere34at31December2013[2012:37days].

Charitable and political donationsThegroupcontributed£10,941[2012:£26,245]forcharitablepurposes.Therewerenopoliticalcontributions.

Going concernInarrivingattheirdecisiontopreparethesefinancialstatements on the going concern basis, the directors havereviewedtheGroup’sbudget,forecastsandcashflowprojectionsfor2014and2015(includingproposedcapitalexpenditure)andcomparedthesewiththeGroup’scashholdings,itscommittedborrowingfacilitiesandprojectedgearingratios.

The directors believe that the Group has adequate resourcestocontinueinoperationalexistenceforthe foreseeable future and so continue to adopt the goingconcernbasis.

Purchase and disposal of sharesAnyshareholderwishingtopurchaseorsellsharesinthe Company should contact our registrars, Capita AssetServices,ortheCompanySecretary.

Directors’ liability insuranceAs permitted by the Articles of Association, the directorshavethebenefitofanindemnitywhichisaqualifyingthirdpartyindemnityprovisionasdefinedbySection234oftheCompaniesAct2006.Theindemnitywasinforcethroughoutthefinancialyearandiscurrentlyinforce.TheCompanyalsopurchasedandmaintainedthroughoutthefinancialyear,Directors’andOfficers’liabilityinsuranceinrespectofitselfanditsdirectors.

Statement of directors’ responsibilitiesThe directors are responsible for preparing the Annual Reportandthefinancialstatementsinaccordancewithapplicablelawandregulations.

Companylawrequiresthedirectorstopreparefinancialstatementsforeachfinancialyear.UnderthatlawthedirectorshavepreparedtheGroupandparentCompanyfinancialstatementsinaccordancewithUnitedKingdomGenerallyAcceptedAccountingPractice(UnitedKingdomAccountingStandardsandapplicablelaw).Undercompanylawthedirectorsmustnotapprovethefinancialstatementsunlesstheyaresatisfiedthattheygiveatrueandfairviewofthestate of affairs of the Group and the Company and oftheprofitorlossoftheGroupforthatperiod.Inpreparingthesefinancialstatements,thedirectorsarerequiredto:

Directors’ report continuedfor the year ended 31 December 2013


• select suitable accounting policies and then apply themconsistently;

• make judgements and accounting estimates that arereasonableandprudent;

•statewhetherapplicableUKAccountingStandardshavebeenfollowed,subjecttoanymaterialdeparturesdisclosedandexplainedinthefinancialstatements;

•preparethefinancialstatementsonthegoingconcern basis unless it is inappropriate to presume thattheCompanyandtheGroupwillcontinueinbusiness.

The directors are responsible for keeping adequate accountingrecordsthataresufficienttoshowandexplaintheCompany’stransactionsanddisclosewithreasonableaccuracyatanytimethefinancialpositionof the Company and the Group and enable them toensurethatthefinancialstatementscomplywiththeCompaniesAct2006.Theyarealsoresponsiblefor safeguarding the assets of the Company and the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The directors are responsible for the maintenance and integrityoftheCompany’swebsites.Legislationinthe United Kingdom governing the preparation and disseminationoffinancialstatementsmaydifferfromlegislationinotherjurisdictions.

Disclosure of information to auditorsEachdirectorinofficeatthedateoftheDirectors’reportconfirmsthefollowing:

• sofarasthedirectorisaware,thereisnorelevantauditinformationofwhichtheCompany’sauditorsareunaware;and

• he has taken all the steps that he ought to have takenasadirectorinordertomakehimselfawareof any relevant audit information and to establish thattheCompany’sauditorsareawareofthatinformation.

Independent auditorsPricewaterhouseCoopersLLPhaveexpressedtheirwillingnesstocontinueasauditorsandaresolutiontore-appointthemwillbeproposedattheforthcomingAnnualGeneralMeeting.

Approved by the Board of Directors and signed on behalfoftheBoard.

E P BoyleSecretary14May2014


Report on the financial statements

Our opinionInouropinionthefinancialstatements,definedbelow:

• giveatrueandfairviewofthestateoftheGroup’s and of the parent Company’s affairs as at 31December2013andoftheGroup’sprofitandcashflowsfortheyearthenended;

• havebeenproperlypreparedinaccordancewithUnited Kingdom Generally Accepted Accounting Practice;and

• havebeenpreparedinaccordancewiththerequirementsoftheCompaniesAct2006.

Thisopinionistobereadinthecontextofwhatwesayintheremainderofthisreport.

What we have auditedTheGroupfinancialstatementsandparentCompanyfinancialstatements(the“financialstatements”),whicharepreparedbyTheAltroGroupplc,comprise:

• the consolidated and Company balance sheets as at 31December2013;

• theconsolidatedprofitandlossaccountandconsolidated statement of total recognised gains and lossesfortheyearthenended;

• theconsolidatedcashflowstatementandreconciliation of cash to movement in net funds for the yearthenended;

• the reconciliation of movements in Group shareholders’fundsfortheyearthenended;and

• thenotestothefinancialstatements,whichincludeasummaryofsignificantaccountingpoliciesandotherexplanatoryinformation.

ThefinancialreportingframeworkthathasbeenappliedintheirpreparationisapplicablelawandUnitedKingdomAccountingStandards(UnitedKingdomGenerallyAcceptedAccountingPractice).

Inapplyingthefinancialreportingframework,thedirectors have made a number of subjective judgements, forexampleinrespectofsignificantaccountingestimates.In making such estimates, they have made assumptions andconsideredfutureevents.

What an audit of financial statements involvesWeconductedourauditinaccordancewithInternationalStandardsonAuditing(UKandIreland)(“ISAs(UK&Ireland)”).Anauditinvolvesobtainingevidenceabouttheamountsanddisclosuresinthefinancialstatementssufficienttogivereasonableassurancethatthefinancialstatementsarefreefrommaterialmisstatement,whethercausedbyfraudorerror.Thisincludesanassessmentof:

• whethertheaccountingpoliciesareappropriatetothe Group’s and the parent Company’s circumstances and have been consistently applied and adequately disclosed;

• thereasonablenessofsignificantaccountingestimatesmadebythedirectors;and

• theoverallpresentationofthefinancialstatements.

Inaddition,wereadallthefinancialandnon-financialinformationintheAnnualReportandfinancialstatements(the“AnnualReport”)toidentifymaterialinconsistencieswiththeauditedfinancialstatementsandtoidentifyany information that is apparently materially incorrect basedon,ormateriallyinconsistentwith,theknowledgeacquiredbyusinthecourseofperformingtheaudit.Ifwebecomeawareofanyapparentmaterialmisstatementsorinconsistenciesweconsidertheimplicationsforourreport.

Opinion on other matter prescribed by the Companies Act 2006In our opinion the information given in the Strategic report andtheDirectors’reportforthefinancialyearforwhichthefinancialstatementsarepreparedisconsistentwiththefinancialstatements.

Other matters on which we are required to report by exception

Adequacy of accounting records and information and explanations receivedUndertheCompaniesAct2006wearerequiredtoreporttoyouif,inouropinion:

• wehavenotreceivedalltheinformationandexplanationswerequireforouraudit;or

• adequate accounting records have not been kept by the parent Company, or returns adequate for our audit have not been received from branches not visited by us;or

• theparentCompanyfinancialstatementsarenotinagreementwiththeaccountingrecordsandreturns.

Wehavenoexceptionstoreportarisingfromthisresponsibility.

Directors’ remunerationUndertheCompaniesAct2006wearerequiredtoreportto you if, in our opinion, certain disclosures of directors’ remunerationspecifiedbylawarenotmade.Wehavenoexceptionstoreportarisingfromthisresponsibility.

Independent auditors’ reportto the members of The Altro Group plcfor the year ended 31 December 2013


Responsibilities for the financial statements and the audit

Our responsibilities and those of the directorsAsexplainedmorefullyintheStatementofdirectors’responsibilitiessetoutonpage6,thedirectorsareresponsibleforthepreparationofthefinancialstatementsandforbeingsatisfiedthattheygiveatrueandfairview.

OurresponsibilityistoauditandexpressanopiniononthefinancialstatementsinaccordancewithapplicablelawandISAs(UK&Ireland).ThosestandardsrequireustocomplywiththeAuditingPracticesBoard’sEthicalStandardsforAuditors.

This report, including the opinions, has been prepared for and only for the Company’s members as a body in accordancewithChapter3ofPart16oftheCompaniesAct2006andfornootherpurpose.Wedonot,ingivingthese opinions, accept or assume responsibility for any otherpurposeortoanyotherpersontowhomthisreportisshownorintowhosehandsitmaycomesavewhereexpresslyagreedbyourpriorconsentinwriting.

Deshan Karunaratne (Senior Statutory Auditor)for and on behalf of PricewaterhouseCoopers LLPChartered Accountants and Statutory AuditorsSt Albans14May2014


Directors and advisers

DirectorsD J Kahn Chairman EPBoylePLCallerG Cleverdon Resigned on 30 June 2013 MPFincham*R J Kahn Managing Director JFHPark**Non-executive

Secretary EPBoyleFCCA

Registered office Works Road LetchworthGardenCityHertfordshireSG61NW

Company registration number 01493087

Independent auditors PricewaterhouseCoopersLLP

Bankers BarclaysBankPLC

Solicitors DLAPiperUKLLP

Stockbrokers Investec Bank plc

Registrars Capita Asset Services The Registry34BeckenhamRoadBeckenhamKentBR34TU


Consolidated profit and loss accountfor the year ended 31 December 2013

2013 2012Notes £’000 £’000

Turnover 2 111,620 112,297Cost of sales (53,177) (52,862)

Gross profit 58,443 59,435Netoperatingexpenses 5 (49,319) (49,291)

Operating profit 9,124 10,144Interest receivable and similar income 6 303 101 Interest payable and similar charges 6 (41) (204)

Profit on ordinary activities before taxation 7 9,386 10,041Taxonprofitonordinaryactivities 10 (2,900) (2,813)

Profit for the financial year 6,486 7,228

Earnings per share 12 Basic 38.3p 42.1pDiluted 38.3p 42.1p

Alltheaboveresultsderivefromcontinuingoperations.

Thereisnomaterialdifferencebetweentheprofitonordinaryactivitiesbeforetaxationandtheprofitforthefinancialyearstatedaboveandtheirhistoricalcostequivalents.


2013 2012Notes £’000 £’000

Total recognised gains and losses relating to the year (564) 6,502Dividends paid 11 (2,289) (2,306)

(2,853) 4,196Purchaseofownshares 24 (270) (668)PurchaseofownsharesfortheShareIncentivePlan 24 (320) (320)PurchaseofownsharesbytheEmployeeBenefitTrust 24 (861) (1,244)DisposalofownsharesbytheEmployeeBenefitTrust 24 590 625Credit in respect of equity-settled share-based payments 24 327 320

Total movement in the year (3,387) 2,909Opening Group shareholders’ funds 60,309 57,400

Closing Group shareholders’ funds 56,922 60,309

Reconciliation of movements in Group shareholders’ fundsfor the year ended 31 December 2013

Consolidated statement of total recognised gains and lossesfor the year ended 31 December 2013

2013 2012Notes £’000 £’000

Profitforthefinancialyear 6,486 7,228 Currency translation differences (955) (370)ActuariallossonnetDefinedBenefitPensionSchemeassets 21 (7,619) (462)Deferredtaxonactuarialloss 1,524 106

Total recognised gains and losses relating to the year (564) 6,502


Consolidated balance sheetat 31 December 2013

2013 2012Notes £’000 £’000

Fixed assetsIntangible assets 14 1,295 1,457Tangible assets 15 43,618 41,472

44,913 42,929

Current assetsStocks 17 15,037 13,808 Debtors 18 18,252 17,842Cash at bank and in hand 7,469 9,728

40,758 41,378Creditors: amounts falling due within one year 19 (15,589) (15,886)

Net current assets 25,169 25,492

Total assets less current liabilities 70,082 68,421

Provisionsforliabilities 20 (606) (582)

Net assets excluding Defined Benefit Pension Scheme liability 69,476 67,839

DefinedBenefitPensionSchemeliability 21 (12,554) (7,530)

Net assets including Defined Benefit Pension Scheme liability 56,922 60,309

Capital and reservesCalled up share capital 23 1,744 1,749Share premium account 24 6,991 6,991Other reserves 24 (1,517) (1,429)Profitandlossaccount 24 49,704 52,998

Total shareholders’ funds 56,922 60,309

Thefinancialstatementsonpages12to41wereapprovedbytheBoardon14May2014 and signed on its behalf by

R J KahnManaging Director


Company balance sheetat 31 December 2013

2013 2012Notes £’000 £’000

Fixed assetsTangible assets 15 27,901 28,179Investments 16 10,107 9,776

38,008 37,955

Current assetsDebtors 18 960 839Cash at bank and in hand 3,112 2,842

4,072 3,681Creditors: amounts falling due within one year 19 (3,422) (3,469)

Net current assets / (liabilities) 650 212

Total assets less current liabilities 38,658 38,167

Provisionsforliabilities 20 (66) (72)

Net assets 38,592 38,095

Capital and reservesCalled up share capital 23 1,744 1,749Share premium account 24 6,991 6,991Other reserves 24 (1,517) (1,429)Profitandlossaccount 24 31,374 30,784

Total shareholders’ funds 38,592 38,095

Thefinancialstatementsonpages12to41wereapprovedbytheBoardon14May2014andsignedonitsbehalfby

R J KahnManaging Director


Consolidated cash flow statementfor the year ended 31 December 2013

2013 2012Notes £’000 £’000

Netcashinflowfromoperatingactivities 25(a) 9,548 10,471Returnsoninvestmentsandservicingoffinance 25(b) 54 88 Taxpaid (2,652) (2,008 )Capitalexpenditureandfinancialinvestment 25(b) (6,430) (9,909 )Equity dividends paid to shareholders 11 (2,289) (2,306 )

Net cash outflow before use of liquid resources and financing (1,769) (3,664 )

FinancingPurchaseofownshares 24 (270) (668 )Issue of ordinary share capital 24 - -

Decrease in cash (2,039) (4,332 )

2013 2012Notes £’000 £’000

Decrease in cash (2,039) (4,332 )Effectofexchangedifferences (243) (102 )

Movement in net funds for the year (2,282) (4,434 )Opening net funds 6,881 11,315

Closing net funds 25(c) 4,599 6,881

Reconciliation of cash to movement in net fundsfor the year ended 31 December 2013


Notes to the consolidated financial statementsfor the year ended 31 December 2013

(a) Basis of accounting TheGroupfinancialstatementshavebeen

preparedundertheprovisionsoftheLarge-and Medium-Sized Companies and Groups (AccountsandReports)Regulations2008 (SI2008/410)andapplicableaccountingstandardsintheUnitedKingdom.Thefinancialstatements are prepared on a going concern basis, under the historical cost convention asmodifiedbytherevaluationoflandandbuildingsandinaccordancewiththeCompaniesAct2006.Theprincipalaccountingpolicies,whichhavebeenappliedconsistentlythroughouttheyear,aresetoutbelow.

(b) Basis of consolidation TheGroupfinancialstatementsconsolidatethe

results of The Altro Group plc and all its subsidiary undertakings at 31 December 2013 using acquisition accounting.TheGroup’saccountingpoliciesareadoptedbyallsubsidiaries.

(c) Capital contributions InaccordancewiththeAmendmentsto

FRS20:Share-basedPayment,astheCompanyhas granted rights over its equity instruments totheemployeesofAltroLimited,thereisacorresponding increase recognised in the investmentinthesubsidiary.

(d) Goodwill and intangible fixed assets Goodwill,beingthedifferencebetweenthe

cost of the businesses acquired and the fair value of their separable net assets, is included inthebalancesheetinaccordancewith FRS10:GoodwillandIntangibleAssets.Purchasesofintangiblefixedassetsareincludedinthebalance sheet at cost less accumulated amortisation.Goodwillandintangiblefixedassets are amortised in equal instalments over their estimated useful economic lives, up to amaximumoftwentyyears.

Theusefuleconomiclivesarereviewedannuallyandrevisedifnecessary.Provisionismadeforanyimpairment.

(e) Tangible fixed assets and depreciation Thecostoftangiblefixedassetsistheirpurchase

cost,togetherwithanyrelatedincidentalcostsofacquisition.Depreciationisprovidedevenlyonthecost(orvaluationwhereappropriate)oftangiblefixedassetstowritethemdowntotheirestimatedresidualvaluesovertheirexpectedusefuleconomiclives.Nodepreciationisprovided on freehold and long leasehold land andassetsunderconstruction.

Theannualratesusedforotherassetsare:

• freeholdandlongleaseholdbuildings-2.5%;

• shortleaseholdbuildings-5%ortermifundertwentyyears;and

• plant,equipmentandvehicles-10%to50%accordingtotypeofasset.

Wherethereisevidenceofimpairment,fixedassetsarewrittendowntotherecoverableamount.

(f) Deferred tax Deferredtaxisprovided,exceptasnotedbelow,

on timing differences that have arisen but not reversedbythebalancesheetdate,wherethetiming differences result in an obligation to pay moretax,orarighttopaylesstax,inthefuture.Timing differences arise because of differences betweenthetreatmentofcertainitemsforaccountingandtaxpurposes.

InaccordancewithFRS19:DeferredTax,deferredtaxisnotprovidedontimingdifferencesarisingfrom:

• revaluation gains on land and buildings, unless there is a binding agreement to sell them at a balancesheetdate;

• gains on the sale of non-monetary assets where,onthebasisofallavailableevidence, itismorelikelythannotthatthetaxablegainwillberolledoverintoreplacementassets;

• extrataxpayableontheunremittedearningsofoverseassubsidiarieswherethereisnocommitmenttoremittheseearnings;

• fairvalueadjustmentgainstofixedassetsandstocktoupliftpricestothoserulingwhenanacquisitionismade.

Deferredtaxassetsarerecognisedtotheextentthat it is regarded as more likely than not that theywillberecovered.

Deferredtaxismeasuredatthetaxratesthatareexpectedtoapplyintheyearswhenthetimingdifferencesareexpectedtoreverse,basedontaxratesandlawenactedorsubstantivelyenactedatthebalancesheetdate.Deferredtaxassetsandliabilitiesarenotdiscounted.

Wherelaworaccountingstandardsrequiregainsand losses to be recognised in the statement of total recognised gains and losses, the related deferredtaxisalsotakendirectlytothestatementoftotalrecognisedgainsandlosses.

1 Accounting policies



Accounting policies (continued)1

(g) Foreign currencies Transactions of UK companies denominated

in foreign currencies are translated into sterling ateither:

• theraterulingatthedateofthetransactions;or

• the contracted rate if the transactions are coveredbyaforwardexchangecontract.

Monetary assets and liabilities denominated in foreign currencies are translated at the rates ruling at the balance sheet date, or, ifappropriate,attheforwardcontractoroptionrate.Thesetranslationdifferencesaredealt withintheprofitandlossaccount.Thefairvalueofforwardexchangecontractsasat 31December2013wasagainof£323,460 (2012:gainof£18,331).TheGroupalsousescurrencyswapstohedgeagainstforeignexchangerisk.Themarketvalueoftheseinstrumentsasat31December2013wasa lossof£43,858(2012:gainof£26,111).

Thefinancialstatementsofforeignsubsidiariesare translated into sterling at the closing rate ofexchange.Thedifferences,whicharetakendirecttoreserves,arisefromthetranslationof:

• the opening net asset investment in subsidiariesattheclosingrates;and

• matched long-term foreign currency borrowings.

(h) Stocks Stocksarestatedatthelowerofcostand

netrealisablevalue.Costrepresentsalldirectcosts incurred in bringing stocks to their present state and location, including an appropriate proportionofmanufacturingoverheads.Wherenecessary,provisionismadeforobsolete,slow-movinganddefectivestocks.

(i) Research and development Researchanddevelopmentexpenditureis

chargedtotheprofitandlossaccountasincurred.

(j) Pension costs TheGroupoperatesaDefinedBenefitPension

Scheme(DBScheme),closedtonewmembersin2005andtofutureaccrualin2014,thecostsofwhichareassessedinaccordancewiththeadviceofanindependentqualifiedactuary.

PensioncostsfortheDBSchemehavebeenaccountedforinaccordancewithFRS17:RetirementBenefits.TheassetsoftheDBSchemeare measured at current bid price, and the liabilities using a projected unit method and discountedatahighqualitycorporatebondrate.

The DB Scheme asset or liability is recognised in full on the balance sheet, net of the effects ofdeferredtax.ThecostchargedtooperatingprofitisthecurrentandpastservicecostoftheDBScheme.Theinterestcostsandexpectedreturn on DB Scheme assets are included in the netfinancechargeorincomeontheprofitandlossaccount.Actuarialgainsorlossesasaresultof the actual return on assets differing from the expectedreturnarerecognisedinthestatementoftotalrecognisedgainsandlosses.

TheGroupalsooperatesanumberofDefinedContributionPensionSchemes(DCSchemes).The pension costs for the DC Schemes represent contributionspayablebytheGroupintheyear.

(k) Investment in own shares InvestmentsintheCompany’sownsharesheld

withintheEmployeeBenefitTrustareincludedin the balance sheet at cost less provision for impairmentinvalue(ifrelevant).

(l) Operating leases Rental costs under operating leases are charged

totheprofitandlossaccountinequalannualamountsovertheperiodsoftheleases.

(m) Employee Benefit Trust (EBT) TheGroup’sEBTisseparatelyadministered.

The liabilities of the EBT are guaranteed by the Company and the assets of the EBT comprise sharesintheCompany.Theincome,costs,assetsand liabilities of the EBT have been included in theconsolidatedfinancialstatements.



1 Accounting policies (continued)

(n) Dividends InaccordancewithFRS21:Eventsafterthe

Balance Sheet Date, dividends proposed after the balance sheet date are not charged to theprofitandlossaccountintheyear.Afinaldividend for the year ended 31 December 2013 willbeproposedattheAnnualGeneralMeetingon19June2014.

(o) Share-based payment The Group issues share options to certain

employees.Thefairvalueofequity-settledshare-based payments is measured at the date of the grant.Thefairvalueofcash-settledshare-basedpayments is remeasured at the end of each year.Thecharge,basedonfairvalueandtheGroup’sestimationofsharesthatwilleventuallyvest,isexpensedonastraightlinebasisoverthevestingperiod.

The calculation of the fair value of the share options issued by the Group has been based on the Black-Scholes valuation model, using a number of subjective assumptions, the most significantofwhichisthattheexpectedvolatilityoftheGroup’ssharevaluationwillbe50%.

TheGroupoperatesaShareIncentivePlanonwhichitisalsorequiredtorecogniseacompensationchargeunderFRS20:Share-basedPayment,calculatedasdetailedabove.

Employer’s National Insurance contributions ariseontheexerciseofcertainshareoptions.InaccordancewithUITF25:NationalInsuranceContributions on Share Option Gains, provision ismade,basedonthedifferencebetweenthemarket price of the Company’s shares at the balancesheetdateandtheoptionexerciseprice, spread pro-rata over the vesting period oftheoptions.

(p) Turnover TheGroupfollowstheprinciplesofApplication

NoteG:RevenueRecognitionofFRS5:Reportingthe Substance of Transactions, in determining appropriaterevenuerecognitionpolicies. In principle therefore, revenue is recognised to theextentthattheGrouphasobtainedtherighttoconsiderationthroughitsperformance.

Turnover(excludingrelevantsalestax)comprisesthe value of sales of goods after deducting certainsalesincentives.

(q) Provisions Provisionsprincipallycomprisemanagement’s

best estimate of costs required to make good forrepairworksonfloorslaid,andanticipatedcoststomakegoodonmodificationsatleasedpremises.

Provisionsaremadewhenanobligationexistsfor a future liability in respect of a past event andwheretheamountoftheobligationcanbereliablyestimated,andareundiscounted.



Turnover

Groupturnoverrepresentstheinvoicedvalueofgoodssoldtoexternalcustomersandcompletedcontractsexcludingrelevantsalestax.

Turnoverbygeographicalareawas:

2013 2012£’000 % £’000 %

TerritoryUnited Kingdom 63,096 57 59,919 54Continental Europe 17,033 15 18,093 16The Americas 22,933 21 25,043 22AustraliaandAsiaPacific 6,785 6 7,824 7Restofworld 1,773 1 1,418 1

111,620 100 112,297 100

Thedirectorshaveelectednottoshowananalysisofturnover,profitbeforetaxornetassetsbyactivityas,intheiropinion,itwouldbeprejudicialtotheinterestsoftheGroup.Ananalysisofprofitandnetassetsbygeographicalareahasbeenomittedforthesamereason.

Group employees

TheaveragemonthlynumberofGroupemployees,includingdirectors,duringtheyearwas:

2013 2012Number Number

Manufacturing 154 158Sales and marketing 230 236Warehouse and distribution 81 79Administration and management 169 163

634 636

Employeecosts,includingdirectors,duringtheyearwere:

2013 2012£’000 £’000

Wages and salaries 24,383 23,604Social security costs 2,561 2,592Other pension costs 2,113 2,098Employeeshareschemes(note22) 332 623Otherstaffbenefits 1,089 1,163

30,478 30,080

AllstaffareemployedbysubsidiarieswithintheGroup.TheCompanyhasnoemployees.

2

3



Directors’ remuneration

2013 2012£ £

Emoluments 1,326,463 1,424,659DefinedBenefitPensionSchemecontributions 54,570 71,807 DefinedContributionPensionSchemecontributions 186,013 186,013

1,567,046 1,682,479

Retirementbenefitsareaccruingtoonedirector(31December2012:two)undertheDBSchemeat31December2013.ContributionsweremadetoaDefinedContributionPensionSchemeonbehalfofonedirector(31December2012:one)intheyearended31December2013.

2013 2012£ £

Highestpaiddirector: Emoluments 548,705 460,953DefinedContributionPensionSchemecontributions 186,013 186,013

734,718 646,966

TheamountoftheaccruedpensionintheDBSchemeofthehighestpaiddirectorat31December2013is£132,043(31December2012:£132,043).Noshareoptions(2012:none)andnoPhantomshareoptions(2012:none)wereexercisedbythehighestpaiddirectorintheyear.

Net operating expenses2013 2012£’000 £’000

Distribution costs 26,988 33,609Administrativeexpenses 22,331 15,682

49,319 49,291

4

5


Interest receivable and payable2013 2012£’000 £’000

Interestreceivableandsimilarincome: short term deposits 32 51 other 63 50

financeincomeonDBScheme(note21) 208 -

Interest receivable and similar income 303 101

Interestpayableandsimilarcharges: bank overdraft (41) (13)financechargeonDBScheme(note21) - (191)

Interest payable and similar charges (41) (204)

Profit on ordinary activities before taxation

Theprofitfortheyearbeforetaxationisarrivedataftercharging/(crediting):

2013 2012£’000 £’000

Depreciation 3,648 3,255 Amortisationofintangiblefixedassets 162 162FeespayabletotheCompany'sauditorfor:

theauditoftheCompanyandconsolidatedfinancialstatements 67 66otherservices:

the audit of the Company's subsidiaries pursuant to legislation 17 16taxationservices 20 31 other services 4 6

Research and development 1,733 1,595Foreignexchangegains (117) (113 )Rentalsunderoperatingleases:

hire of plant and machinery 14 3 other operating leases 1,489 1,602

Lossondisposaloftangiblefixedassets 6 25

Profit attributable to the shareholders of the Company

TheprofitattributabletotheshareholdersofTheAltroGroupplcis£3,319,943(2012:£11,471,136).ThedirectorshavetakenadvantageoftheexemptionunderSection408oftheCompaniesAct2006andhavenotpresentedaprofitandlossaccountfortheCompany.

7

8


6


Operating lease commitments

Thecommitmentsat31Decemberundernon-cancellableoperatingleasesare:

2013 2012Land and Landandbuildings Other buildings Other

£’000 £’000 £’000 £’000

Leasesexpiring:withinoneyear 13 75 100 93betweenoneandfiveyears 618 511 548 602afterfiveyears 81 - 81 -

712 586 729 695

Tax on profit on ordinary activities

Thetaxchargebasedontheprofitfortheyearismadeupasfollows:

2013 2012£’000 £’000

Current tax:UKcorporationandincometax:

currenttaxonincomefortheyear 1,796 1,872 adjustments in respect of prior years (93) (47)

1,703 1,825

Foreigntax:currenttaxonincomefortheyear 567 740 adjustments in respect of prior years 4 (133)

571 607

Current tax charge 2,274 2,432

Deferred tax: timing differences - origination and reversal 626 381

Deferred tax charge 626 381

Tax on profit on ordinary activities 2,900 2,813

10

9



Tax on profit on ordinary activities (continued)

Thecurrenttaxchargefortheyearislower(2012:lower)thantheapplicablehybridrateofcorporationtaxintheUKof23.25%(2012:24.50%).Thehybridrateisaresultofataxrateof24.00%forFY2012and23.00%forFY2013.

Areconciliationofthecurrenttaxchargefortheyearispresentedbelow:

2013 2012£’000 £’000

Profit on ordinary activities before taxation 9,386 10,041

Taxchargeonprofitatahybridrateof23.25%(2012:24.50%) 2,182 2,460Expensesnotdeductiblefortaxpurposes 328 146Depreciationinexcessofcapitalallowances 124 153 Movement in short-term timing differences (410) (215 )DifferencesinUKincometaxandoverseastaxrates 178 134Adjustments in respect of prior years (89) (180 )Other (39) (66 )

Current tax charge 2,274 2,432

Factors that may affect the future current tax charge

Deferredtaxhasnotbeenprovidedonrevaluationsoffixedassets.Thistaxwillonlybecomepayableiftheassetsaresoldandroll-overreliefisnotobtained.Theestimatedamountoftaxthatwouldbecomepayableinthesecircumstancesis£298,933(2012:£343,773).

Deferredtaxhasnotbeenprovidedinrespectofgainsrealisedthathavebeenrolledoverintotheacquisitioncostofreplacementassets.Thistaxwillbecomepayableifthereplacementassetsaresoldandfurtherroll-overreliefisnotobtained.Theestimatedamountoftaxthatwouldbecomepayableinthesecircumstancesis£130,522(2012:£150,100).

ThestandardrateofcorporationtaxintheUKchangedfrom24%to23%witheffectfrom1April2013.Accordingly,UKprofitsforthisaccountingperiodaretaxedataneffectiverateof23.25%.

Inadditiontothechangeintherateofcorporationtaxdisclosedabove,furtherchangestotheUKcorporationtaxsystemwereannouncedintheMarch2013UKBudgetStatement.Legislationtoreducethemainrateofcorporationtaxfrom23%to21%from1April2014andtofurtherreducethemainrateofcorporationtaxfrom21%to20%from1April2015wasincludedintheFinanceAct2013andthiswassubstantivelyenactedon2July2013.

AsaresultofthechangeintheUKmainratesofcorporationtax,therelevantdeferredtaxbalanceshavebeenremeasured.

10



Earnings per share2013 2012£’000 £’000

Profit for the financial year 6,486 7,228

2013 2012Number Number

of shares of shares

Weighted average number of shares in issue 17,410,049 17,561,069WeightedaveragenumberofsharesheldbytheEmployeeBenefitTrust (468,025) (388,741)

Basicweightedaveragenumberofsharesinissue 16,942,024 17,172,328 Dilutive effect of share option schemes 1,765 2,859

Diluted weighted average number of shares 16,943,789 17,175,187

Earnings per shareBasic 38.3p 42.1pDiluted 38.3p 42.1p

Basicearningspershareiscalculatedbydividingtheearningsattributabletoordinaryshareholdersbytheweightedaveragenumberofordinarysharesoutstandingduringtheyear,excludingtheweightedaveragenumberofsharesheldbytheEmployeeBenefitTrust.

Fordilutedearningspershare,theweightedaveragenumberofordinarysharesinissueisadjustedtoassumeconversionofalldilutivepotentialordinaryshares.TheGrouphasoneclassofdilutivepotentialordinaryshares,namelyshareoptionsgrantedtoemployeeswheretheexercisepriceislessthantheaveragemarketpriceoftheCompany’sordinarysharesduringtheyear.

12


Dividends

2013 2012£’000 £’000

Finaldividendforprioryearof9.0ppershare(2012:9.0p) 1,525 1,538 Interimdividendforcurrentyearof4.5ppershare(2012:4.5p) 764 768

2,289 2,306

Afinaldividendof9.0ppersharefortheyearended31December2013willbeproposedattheAnnualGeneralMeetingon19June2014.Basedonthenumberofsharesinissueatthedateofthisreport,thiswouldequatetoadividendof£1,569,373.InaccordancewithFRS21:EventsaftertheBalanceSheetDate,thisdividendisnotincludedabove.

DividendspayableonsharesheldbytheEmployeeBenefitTrusthavebeenwaived.

11


Investment in own shares

TheGroupaccountsforitsownsharesheldbythetrusteesoftheEmployeeBenefitTrust(EBT)asadeductionfromshareholders’fundsasrequiredbyUITF38:AccountingforESOPTrusts.ThecostsofrunningtheEBTarechargedtotheCompany’sprofitandlossaccountastheyoccurandarefinancedbyadvancesfromtheCompany.

At 31 December2013 2012

NumberofsharesintheCompanyownedbytheEBT 477,546 425,098Nominal value of shares held £47,755 £42,510Cost price of shares held £2,494,521 £2,401,703Prevailingvaluationoftheshares(pence) 467 521 Total market value of shares £2,230,140 £2,214,761MaximumnumberofsharesintheCompanyownedbytheEBTduringtheyear 520,901 475,428MinimumnumberofsharesintheCompanyownedbytheEBTduringtheyear 425,098 330,697

TheEBTdoesnotawardsharestoemployeesbutsellssharesitholdsbothtoemployeesandtoTheAltroGroupplc.ThesharesheldbytheEBTarethereforenotunderoptiontoemployees.

Dividendspayableonthesesharesarewaived.

Intangible fixed assets

The GroupDistribution rights Franchise Goodwill Total

£’000 £’000 £’000 £’000

CostAt 1 January 2013 100 141 3,216 3,457

At 31 December 2013 100 141 3,216 3,457

Accumulated amortisationAt 1 January 2013 100 73 1,827 2,000Charge for the year - 7 155 162

At 31 December 2013 100 80 1,982 2,162

Net book valueAt 31 December 2013 - 61 1,234 1,295

At 31 December 2012 - 68 1,389 1,457

TheCompanydoesnotholdanyintangiblefixedassets.


14

13



Tangible fixed assets

The Group Land and buildings Plantequipment

Long Short andFreehold leasehold leasehold vehicles Total

£’000 £’000 £’000 £’000 £’000

Cost or valuationAt 1 January 2013 2,291 34,229 695 37,536 74,751Currency translation differences (7) - (15) (100) (122)Additions 58 395 2 5,405 5,860Disposals - - - (173) (173)

At 31 December 2013 2,342 34,624 682 42,668 80,316

At valuation 256 4,394 - - 4,650At cost 2,086 30,230 682 42,668 75,666

At 31 December 2013 2,342 34,624 682 42,668 80,316

Accumulated depreciationAt 1 January 2013 639 6,925 552 25,163 33,279Currency translation differences (2) - (5) (75) (82)Charge for the year 51 657 26 2,914 3,648Disposals - - - (147) (147)

At 31 December 2013 688 7,582 573 27,855 36,698

Net book valueAt 31 December 2013 1,654 27,042 109 14,813 43,618

At 31 December 2012 1,652 27,304 143 12,373 41,472

Comparable amounts determined according tothehistoricalcostconvention: cost 2,216 33,273 681 42,631 78,801 accumulated depreciation (675) (7,337) (574) (27,820) (36,406)

Net book valueAt 31 December 2013 1,541 25,936 107 14,811 42,395

At 31 December 2012 1,536 26,198 143 12,373 40,250

15


Tangible fixed assets (continued)

The Company Land and buildingsLong

Freehold leasehold Total£’000 £’000 £’000

Cost or valuationAt 1 January 2013 1,095 34,229 35,324Additions - 395 395

At 31 December 2013 1,095 34,624 35,719

At valuation 256 4,394 4,650At cost 839 30,230 31,069

At 31 December 2013 1,095 34,624 35,719

Accumulated depreciationAt 1 January 2013 221 6,924 7,145Charge for the year 16 657 673

At 31 December 2013 237 7,581 7,818

Net book valueAt 31 December 2013 858 27,043 27,901

At 31 December 2012 874 27,305 28,179

Comparable amounts determined according tothehistoricalcostconvention: cost 969 33,273 34,242 accumulated depreciation (228) (7,336) (7,564)

Net book valueAt 31 December 2013 741 25,937 26,678

At 31 December 2012 758 26,199 26,957

15




Fixed asset investments

Group Group Company Company2013 2012 2013 2012£’000 £’000 £’000 £’000

At 1 January - - 9,776 9,153Capital contribution arising from share-based payment charge - - 331 623

At 31 December - - 10,107 9,776

Thedirectorsbelievethatthecarryingvalueoftheinvestmentsissupportedbytheirunderlyingnetassets.

ThecapitalcontributionsarisingfromtheFRS20:Share-basedPaymentchargeareduetotheCompanygrantingshareoptionstoemployeesofAltroLimited.TheapplicationoftheAmendmentstoFRS20:Share-basedPaymentresultsinacorrespondingincreaseininvestmentinAltroLimited.

Principal trading subsidiaries

Theprincipaltradingsubsidiariesat31December2013were:

Company

Country ofincorporation

Class ofshares

% of shares held

Activity

AltroLimited England&Wales Ordinary 100 Manufacturing and marketingAltroAPACPtyLimited Australia Ordinary 100 DistributionAltroGmbH Germany - 100 DistributionAltro Nordic AB Sweden Ordinary 100 DistributionAltro Scandess SA Spain Ordinary 100 DistributionAltro Canada Inc Canada Common 100 DistributionAltro USA Inc USA - 100 Distribution

16

Stocks

2013 2012£’000 £’000

Rawmaterialsandconsumables 4,355 4,413Finished goods and goods held for resale 10,682 9,395

15,037 13,808

17



Debtors


Trade debtors 14,353 13,037 - - Amountsowedbygroupundertakings - - 960 839Other debtors 655 993 - - Prepaymentsandaccruedincome 3,244 3,812 - -

18,252 17,842 960 839

Amountsowedbygroupundertakingsareunsecured,repayableondemandandaccrueinterestatrelevantagreedratestotheextentthatsuchbalancesareoverdue.

Creditors: amounts falling due within one year


Bank overdrafts 2,870 2,847 2,870 2,847Trade creditors 4,907 5,560 - - Corporatetax 523 879 - - Taxationandsocialsecurity 1,253 1,226 - - Other creditors 311 167 - - Accruals 5,725 5,207 552 622

15,589 15,886 3,422 3,469

Amountsowedtogroupundertakingsareunsecured,interest-freeandrepayableondemand.

18

19

20 Provisions for liabilities

The Group

Deferred tax Other Total£’000 £’000 £’000

At 1 January 2013 73 509 582Chargedtoprofitandlossaccount 124 285 409Utilised in the year - (113) (113)Released in the year (132) (87) (219)Other movement (20) (33) (53)

At 31 December 2013 45 561 606

Otherprovisionsrepresentestimatedamountsinrespectofworldwidedilapidationsandreparations.Thisprovision isexpectedtobeusedoverthenextfiveyears.



Provisions for liabilities (continued)

The CompanyDeferred tax Other Total

£’000 £’000 £’000

At 1 January 2013 72 - 72Chargedtoprofitandlossaccount (6) - (6)

At 31 December 2013 66 - 66

Deferred taxGroup Group Company Company

2013 2012 2013 2012£’000 £’000 £’000 £’000

Acceleratedcapitalallowances 498 568 66 72Other short-term timing differences (453) (495) - -

Deferred tax liability 45 73 66 72

Deferred tax asset relating to Defined Benefit Pension Scheme deficitGroup Group

2013 2012£’000 £’000

At 1 January 2,249 2,623Deferredtaxchargetoprofitandlossaccount (635) (480)Deferredtaxcredittostatementoftotalrecognisedgainsandlosses 1,524 106

At 31 December 3,138 2,249

Unprovided deferred taxGroup Group Company Company

2013 2012 2013 2012£’000 £’000 £’000 £’000

Roll-over relief 131 150 131 150Surplus on revaluation of land and buildings 299 344 299 344

Unprovided deferred tax 430 494 430 494

20


Retirement benefits

(a) Defined Benefit Pension Scheme (DB Scheme)TheGroupoperatesafundedDBSchemeintheUKwhichoffersbothpensionsinretirementanddeathbenefitstomembers.Pensionbenefitsarerelatedtothemembers’finalsalaryatretirementandtheirlengthofservice.Afullactuarialvaluationwascarriedoutasat30April2011;theresultshavebeenupdatedto31December2013byaqualifiedindependentactuaryandshowedadeficitatthatdateof£15.7milliongrossofdeferredtax,measuredinaccordancewithFRS17:RetirementBenefits.

AstheDBSchemeisclosedtofutureaccrualfrom1April2014,undertheprojectedunitmethod,thecurrentservicecost,asapercentageofpensionablesalaries,willincreaseasthedeferredmembersoftheSchemeapproachretirement.ContributionsbytheGrouptotheDBSchemefortheyearbeginning1January2014arecurrentlyexpectedtobe£0.3millionoffutureaccrualpaymentsand£1.8millionofdeficitreductionpayments.

i) Net pension liability

Thepensionliabilityat31Decemberwasasfollows:2013 2012£’000 £’000

Fair value of DB Scheme assets 94,403 88,216PresentvalueofDBSchemeliabilities (110,095) (97,995)

Pensionliabilitybeforetax (15,692) (9,779)Relateddeferredtaxasset 3,138 2,249

Net pension liability (12,554) (7,530)

ThepresentvalueofunfundedDBSchemeliabilitiesisnil(2012:nil).TheirrecoverablesurplusintheDBScheme isnil(2012:nil).

ii) Analysis of assets and expected rates of return

TheassetsintheDBSchemeandtheexpectedratesofreturnat31Decemberwere:

2013 2012Expected Expected

rate % of overall rate %ofoverallof return DB Scheme of return DB Scheme

% assets £’000 % assets £’000

Equities 7.7 31.0 29,232 8.0 27.2 23,971Corporate bonds - - - 4.6 10.8 9,528LDIfundsandcash 3.6 34.5 32,580 2.7 39.6 34,940DiversifiedGrowthFunds 7.7 34.5 32,591 8.0 22.4 19,777

Fair value of DB Scheme assets 100.0 94,403 100.0 88,216

TheDBSchemeassetsdonotincludeanyoftheCompany’sownfinancialinstruments,noranypropertyoccupiedby,orotherassetsusedbytheCompany.

21




Retirement benefits (continued)

iii) Financial and demographic assumptions

Theprincipalfinancialassumptionsusedbytheactuaryatthebalancesheetdatewere:

2013 2012% %

Rate of increase in salaries 4.5 4.1Rateofincreaseinpensionsinpayment(postApril1997) 3.8 3.6Discount rate 4.5 4.6Inflationassumption 3.5 3.1

Theassumedlifeexpectanciesonretirementatage65were:2013 2012

Years Years

Retiring today males 22.0 22.0 females 25.2 25.2Retiring in 20 years’ time males 23.4 23.4 females 26.7 26.7

TheassumptionsusedindeterminingtheoverallexpectedreturnoftheDBSchemehavebeensetwithreferencetoyieldsavailableongovernmentbondsandappropriateriskmargins.

iv) Changes in fair value of DB Scheme assets

2013 2012£’000 £’000

Fair value of DB Scheme assets at 1 January 88,216 80,808 ExpectedreturnonDBSchemeassets 4,700 4,193Actuarial gain 695 1,797Contributions by employer 3,226 3,116Contributions by DB Scheme members 636 665Benefitspaid (3,070) (2,363)

Fair value of DB Scheme assets at 31 December 94,403 88,216

TheexpectedreturnonDBSchemeassetsisdeterminedbyconsideringtheexpectedreturnsavailableontheassetsunderlyingthecurrentinvestmentpolicy.Expectedyieldsonfixedinterestinvestmentsarebasedongrossredemptionyieldsasatthebalancesheetdate.Expectedreturnsonequityinvestmentsreflectlong-termrealratesofreturnexperiencedintherespectivemarkets.

TheactualreturnonDBSchemeassetsintheyearwas£5.4million(2012:£6.0million).

21



v) Changes in present value of DB Scheme liabilities

2013 2012£’000 £’000

PresentvalueofDBSchemeliabilitiesat1January 97,995 91,298Current service cost 1,728 1,752 Interest cost 4,492 4,384Contributions by DB Scheme members 636 665Actuarial loss 8,314 2,259Benefitspaid (3,070) (2,363)

Present value of DB Scheme liabilities at 31 December 110,095 97,995

vi) Analysis of amounts recognised in the profit and loss account

2013 2012£’000 £’000

Current service cost 1,728 1,752

Total operating charge 1,728 1,752

ExpectedreturnonDBSchemeassets (4,700) (4,193)Interest on DB Scheme liabilities 4,492 4,384

Total finance (income) / charge (note 6) (208) 191

vii) Cumulative actuarial gains and losses recognised in equity

2013 2012£’000 £’000

Cumulative actuarial loss at 1 January (24,810) (24,348)Actuarial loss in the year (7,619) (462)

Cumulative actuarial loss at 31 December (32,429) (24,810)

21





viii) History of DB Scheme

Assets and liabilities2013 2012 2011 2010 2009£’000 £’000 £’000 £’000 £’000

Fair value of DB Scheme assets 94,403 88,216 80,808 74,025 65,123PresentvalueofDBSchemeliabilities (110,095) (97,995 ) (91,298 ) (81,329) (72,419 )

Pension liability before tax (15,692) (9,779 ) (10,490 ) (7,304) (7,296 )

Actuarial gains and losses2013 2012 2011 2010 2009£’000 £’000 £’000 £’000 £’000

Total actuarial loss recognised (7,619) (462 ) (4,675 ) (1,697) (13,772 )

Experience adjustments2013 2012 2011 2010 2009

ExperienceadjustmentstoDBSchemeassetsamount(£'000) 695 1,797 580 2,588 3,861%ofDBSchemeassets 0.7 2.0 0.7 3.5 5.9ExperienceadjustmentstoDBSchemeliabilitiesamount(£'000) 46 (210 ) (3,739 ) - - %ofDBSchemeliabilities 0.0 (0.2 ) (4.1 ) - -

AsTheAltroGroupplchasnoemployees,noDBSchemedisclosuresaregivenfortheCompany.

ContributionsbytheGrouptotheDBSchemewillbemadeatarateof18.2%ofmembers’salariesuntil31March2014.

(b) Defined Contribution Pension Schemes (DC Schemes)

TheGroupmakescontributionsintoanumberofDefinedContributionPensionSchemes,whoseassetsareheldinseparatefunds.ThetotalcontributionspayablebytheGroupintheyearinrespectoftheseSchemeswere£384,919(2012:£346,107).Therewerenoaccruedcontributionsattheyearend(2012:nil).Contributionsof£2,278,655wereprepaidattheyearend(2012:£2,464,668).

21


Thechargeinrespectofshare-basedpaymenttransactionsincludedintheGroup’sconsolidatedprofitandlossaccountfortheyearisasfollows:

2013 2012£’000 £’000

Expense arising from share-based payment arrangements 321 667

AreconciliationofoptionandSIPmovementsovertheyearto31December2013isshownbelow.SharesissuedundertheSIPdonothaveanexercisepriceandthereforeonlyareconciliationofthenumberofawardshasbeenshownandnotoftheirweightedaverageexerciseprice.

2013 2012Weighted Weightedaverage average

Number of exercise price Number of exercisepriceoptions pence options pence

Outstanding at 1 January 754,865 409 798,175 382Granted during the year 188,859 521 190,436 475Exercisedduringtheyear (122,017) 324 (227,561) 350Cancelled during the year (8,014) 515 (6,185) 485

Outstanding at 31 December 813,693 436 754,865 409

Exercisable at 31 December 249,187 376 144,841 422

22 Share-based payment

Duringtheyearended31December2013,theGroupoperatedthreeshare-basedpaymentarrangements,asfollows:

The Altro Group plc 2007 United Kingdom Approved Share Option Scheme (Approved Scheme) TheApprovedSchemewasintroducedin2007.UndertheApprovedSchemetheboardcangrantoptionsoversharesintheCompanytoemployeesoftheGroup.Optionsaregrantedwithafixedexercisedpriceequaltothemarketpriceofthesharesunderoptionatthedateofgrant.Thecontractuallifeofanoptionistenyears.Awardsaregenerallyreservedforemployeesatsenioranddirectorlevel.Therearenineeligibleparticipantsatthebalancesheetdate,theCompanyhasmadeannualgrantssincetheinceptionoftheApprovedScheme.OptionsgrantedundertheApprovedSchemewillbecomeexercisableonthethirdanniversaryofthedateofgrantandexerciseisconditionalontherehavingbeenrealgrowthintheearningspershareoftheGroupinanythreeyearsbetweenthedatetheoptionwasgrantedandthedateofexercise.RealgrowthmeansanincreaseabovetheGeneralIndexofRetailPricesofnotlessthan2%andearningspershareareasshownintheGroup’sauditedfinancialstatements.Exerciseofanoptionissubjecttocontinuedemploymentandcanbesatisfiedineithercashorequity.

The Altro Group plc Phantom Share Option Scheme 2005 (Phantom Scheme) ThePhantomSchemewasintroducedin2005andtheboardcangrantoptionsovernotionalsharesintheCompanytoemployeesoftheGroup.Thecontractuallifeofanoptionissevenyearsandoptionsaregrantedwithafixedexercisepriceequaltothemarketpriceofthesharesunderoptionatthedateofgrant.AwardsunderthePhantomSchemearegenerallyreservedforemployeesatsenioranddirectorlevel.Therearenineeligibleparticipantsatthebalancesheetdate,theCompanyhasmadeannualgrantssince2006.Optionsgrantedwillbecomeexercisableonthethirdanniversaryofthedateofgrant.TherearenoperformanceconditionsattachedtotheexerciseofanoptionunderthePhantomScheme.AnoptionisusuallysatisfiedincashalthoughtheboarddoeshaveanabsolutediscretiontosatisfypaymentinwholeorinpartbytheissueofequityintheCompany.

The Altro Group plc Share Incentive Plan (SIP) TheSIPwasintroducedin2003andtheboardcanawardFreeSharesintheCompanytoUK-basedemployeesofAltroLimited.UndercurrentlegislationFreeSharesmustbekeptintrustforaminimumofthreeyearsandforfiveyearstotakeadvantageoffulltaxbenefits.Thereisanupperstatutorylimitof£3,000worthofsharespertaxyear.AwardsaregrantedwithafixedpriceequaltothemarketpriceofthesharesatthedateofAward.AwardsundertheSIParereservedforemployeeswhohavebeenincontinuousemploymentforaperiodofsixmonthspriortotheAwardeligibilitydate.TheeligibilitydateissetonemonthpriortotheAwarddate.RecipientsofagrantmadeundereithertheApprovedSchemeorPhantomSchemedonotparticipateintheSIP.Thereare458eligibleemployeesatthebalancesheetdate.TheCompanyhasmadeannualawardssince2003andtherearenoperformanceconditionsattachedtoanAward.AnAwardissatisfiedbytheissueofequityshares.Theexercisepriceisnilanddividendsarepaidastheyfalldue.



Share-based payment (continued)

Duringtheyearonedirectorexercisedshareoptions(2012:one).

TheweightedaveragefairvalueoftheshareoptionsgrantedduringtheyearwascalculatedusingtheBlack-Scholesoptionvaluationmodel,withthefollowingassumptionsandinputs:

2013 2012

Risk-free interest rate 1.6% 0.6%Expectedvolatility 50% 50%Expectedoptionlife 4 years 4yearsExpecteddividendyield 3.0% 3.0%


Theexpirydatesandexercisepricesoftheshareoptionsoutstandingat31Decemberareasfollows:

Settlement Number of options Exercise priceShare option schemes method 2013 2012 pence Exercisable between

Approved Equity 27,078 27,078 485 03.04.2011and03.04.201510,123 10,123 404 05.03.2012and05.03.201917,475 17,475 515 04.04.2014and04.04.2021

1,633 1,633 475 11.04.2015and11.04.2022

Total Approved 56,309 56,309

Phantom Cash - 10,449 352 18.04.2010and18.04.20143,961 3,961 485 18.04.2010and18.04.20147,281 7,281 485 03.04.2011and03.04.2015

85,949 85,949 404 05.03.2012and05.03.2016114,795 149,276 316 15.07.2013and15.07.2017

95,879 103,893 515 04.04.2014and04.04.2018125,569 125,569 475 11.04.2015and11.04.2019121,516 - 521 11.04.2016and11.04.2020

Total Phantom 554,950 486,378

ShareIncentivePlan Equity 202,434 212,178

Total Share Incentive Plan 202,434 212,178

Total share options outstanding 813,693 754,865

22


Called up share capitalAuthorised, called up, allotted and fully paid share capital

2013 2012£’000 £’000

Authorised:50,000,000ordinarysharesof10peach(2012:50,000,000ordinarysharesof10peach) 5,000 5,000

Calledup,allottedandfullypaid:17,437,476ordinarysharesof10peach(2012:17,494,356ordinarysharesof10peach) 1,744 1,749

Movements in share capital in the year2013 2012

Number Numberof shares of shares

At 1 January 17,494,356 17,626,339Shares issued - - Ownsharespurchased (56,880) (131,983)

At 31 December 17,437,476 17,494,356

Allotment of sharesDuringtheyearnooptionswereexercisedtoacquireordinaryshares.44,930optionswereexercisedunderTheAltroGroupplcPhantomShareOptionScheme2005,whichdidnotresultintheissueofshares.

Purchase of own sharesDuringtheyeartheCompanypurchasedandsubsequentlycancelled56,880ofitsownshares.Thenominalvalue oftheshareswas£5,688(2012:£13,198)andtheamountpaidwas£270,180(2012:£667,833).

Major shareholdingsInadditiontotheinterestsofthedirectors,at31December2013therewerethefollowingsubstantialinterestsinthesharesoftheCompany:

Shareholder Shares %

KHarrison 804,652 4.6%MHarmer 680,300 3.9%

23


Shareholder analysis Number

Shares(millions)

%

Directors and their families 13 10.5 60.3Employees,ex-employeesandtheirfamilies 393 5.1 29.3TheShareIncentivePlanandtheEmployeeBenefitTrust 12 0.9 5.2Institutions 1 0.2 1.2Other 1 0.7 4.0

420 17.4 100.0



ReservesCalled up Share Capital

share premium redemption Own Profit and Totalcapital account reserve shares loss account reserves

£’000 £’000 £’000 £’000 £’000 £’000

The GroupAt 1 January 2013 1,749 6,991 973 (2,402) 52,998 60,309Dividends paid - - - - (2,289) (2,289)Actuarial loss on DB Scheme - - - - (6,095) (6,095)Purchaseofownshares (5) - 5 - (270) (270)PurchaseofownsharesfortheSIP - - - - (320) (320)PurchaseofownsharesbytheEBT - - - (861) - (861)DisposalofownsharesbytheEBT - - - 768 (178) 590Share issue - - - - - - Currency translation differences - - - - (955) (955)Increase in reserves arising from share-based payments

-

-

-

-

327

327

Profitforthefinancialyear - - - - 6,486 6,486

At 31 December 2013 1,744 6,991 978 (2,495) 49,704 56,922

Called up Share Capitalshare premium redemption Own Profit and Total

capital account reserve shares loss account reserves£’000 £’000 £’000 £’000 £’000 £’000

The CompanyAt 1 January 2013 1,749 6,991 973 (2,402) 30,784 38,095Dividends paid - - - - (2,289) (2,289)Purchaseofownshares (5) - 5 - (270) (270)PurchaseofownsharesfortheSIP - - - - (320) (320)PurchaseofownsharesbytheEBT - - - (861) - (861)DisposalofownsharesbytheEBT - - - 768 (178) 590Share issue - - - - - - Capital contribution arising from share-based payments

-

-

-

-

327

327

Profitforthefinancialyear - - - - 3,320 3,320

At 31 December 2013 1,744 6,991 978 (2,495) 31,374 38,592

24Other reserves

Other reserves


Notes to the consolidated cash flow statement

(a) Reconciliation of operating profit to net cash inflow from operating activities

2013 2012£’000 £’000

Operatingprofit 9,124 10,144Depreciation charge 3,648 3,255 DB Scheme contributions (3,226) (3,116 )DB Scheme operating charge 1,728 1,752 Amortisationofintangiblefixedassets 162 162Lossondisposaloftangiblefixedassets 6 25 Increase/(decrease)innetprovisions 79 (549 )Currency translation differences and other non-cash movements 166 167(Increase)/decreaseinstock (1,583) 450Increase in debtors and prepayments (682) (773 )Increase/(decrease)increditors 126 (1,046 )

Net cash inflow from operating activities 9,548 10,471

(b) Analysis of cash flows for amounts netted in cash flow statement

2013 2012£’000 £’000

Returns on investments and servicing of financeInterest received 95 101Interest paid (41) (13)

54 88

Capital expenditure and financial investmentPurchaseoftangiblefixedassets (5,860) (8,999)Disposaloftangiblefixedassets 21 29PurchaseofownsharesfortheShareIncentivePlan (320) (320)PurchaseofownsharesbytheEmployeeBenefitTrust (861) (1,244)DisposalofownsharesbytheEmployeeBenefitTrust 590 625

(6,430) (9,909)

(c) Analysis of net funds

Cash at bank Bankand in hand overdrafts Total

£’000 £’000 £’000

At 1 January 2013 9,728 (2,847) 6,881Cashflow (2,016) (23) (2,039)Exchangemovements (243) - (243)

At 31 December 2013 7,469 (2,870) 4,599

25




Capital commitments

2013 2012£’000 £’000

Contracted but not provided for 532 2,538

Post-balance sheet eventFollowingaperiodofconsultation,thedecisionwastakentoclosetheDefinedBenefitPensionScheme,previouslyclosedtonewmembersinSeptember2005,tofutureaccrualfrom31March2014.AllcurrentactivemembershavebecomedeferredmembersoftheScheme,andhavebeenofferedmembershipofaDefinedContributionPensionScheme.InaccordancewiththeprovisionsofFRS17:RetirementBenefitsandFRS21:EventsaftertheBalanceSheetDate,anycurtailmentgainorlosswillbereflectedinthe2014financialstatements.

Related party transactionsTheCompanyhastakenadvantageoftheexemptionavailableunderFRS8:RelatedPartyTransactionsandhasnotdisclosedtransactionswithotherGroupcompanies.

Ultimate parent companyThe ultimate parent undertaking and controlling party is The Altro Group plc, a Company incorporated in Great BritainandregisteredinEnglandandWales.Fortheyearended31December2013,TheAltroGroupplcistheparentundertakingofthelargestandsmallestgroupofundertakingswhoseresultsareconsolidatedinthesefinancialstatementsat31December2013.

26

27

28

29


Five year financial summary

Thissummarydoesnotformpartoftheauditedfinancialstatements.

2013 2012 2011 2010 2009

£’000 £’000 £’000 £’000 £’000

Balance sheet

Fixedassets 44,913 42,929 37,409 34,517 33,711

Current assets 40,758 41,378 45,507 47,777 49,236

Total assets 85,671 84,307 82,916 82,294 82,947

Ordinary shareholders' funds 56,922 60,309 57,400 59,442 61,638

Borrowings:

duewithinoneyear - - - - -

Other creditors 16,195 16,468 17,649 17,593 16,056

DefinedBenefitPensionSchemeliability 12,554 7,530 7,867 5,259 5,253

Total funds employed 85,671 84,307 82,916 82,294 82,947

Turnover and profits

Turnover 111,620 112,297 109,338 109,826 111,749

Operatingprofit 9,124 10,144 8,752 12,504 11,862

Profitforthefinancialyear 6,486 7,228 6,222 8,405 7,105

Ordinary dividends 2,289 2,306 2,332 2,208 2,255

Pence Pence Pence Pence Pence

Diluted earnings per share 38.3 42.1 35.6 46.9 34.5

Dividends per share 13.5 13.5 13.5 13.5 12.0

Net assets per share 326.4 344.7 325.6 334.5 295.8

Gearing ratio % 0.0 0.0 0.0 0.0 0.0

Average number of employees 634 636 621 615 617

Thefinaldividendsarenotincludedintheordinarydividendstotalabove,inaccordancewithFRS21(seenote11). Theyareincludedinthedividendspershare.


Notice of Annual General Meeting

NoticeisherebygiventhattheAnnualGeneralMeetingofTheAltroGroupplcwillbeheldatWorksRoad,LetchworthGardenCity,Hertfordshire,SG61NWon19June2014,at5.00pm.

Ordinary business1. Toreceiveandadoptthereportofthedirectorsandthefinancialstatementsfortheyearended31December2013,

togetherwiththereportoftheauditors.

2. Todeclareafinaldividendof9.0pperissuedOrdinaryShareof10peachoftheCompanyinrespectoftheyearended 31December2013.

3. Toauthorisethedirectors’remunerationpayablefortheyearended31December2013.

4. Tore-appointPricewaterhouseCoopersLLPasauditorsoftheCompanyandtoauthorisethedirectorstoagree theirremuneration.

5.ToapprovetheextensionofthePhantomShareOptionScheme2005until31December2017.

Special business6. Toconsiderandifthoughtfit,passthefollowingresolutionwhichwillbeproposedasaspecialresolution:

THATthetermsoftheproposedcontractswherebytheCompanyshallbecomeentitledandobligedtopurchaseup to180,180sharesof10peachatapriceof555ppershare,copiesofwhichhavebeenavailableforinspectionbythemembersoftheCompanyattheCompany’sregisteredofficefornotlessthanfifteendaysendingwiththedatehereofandcopiesofwhichhavebeenproducedtotheMeetingandinitialledforthepurposeofidentificationbytheCompanySecretary, are hereby approved and any director of the Company is hereby authorised to enter into the said contracts onbehalfoftheCompanyatanytimebeforetheconclusionofthenextAnnualGeneralMeeting.

7. Toconsiderandifthoughtfit,passthefollowingresolutionwhichwillbeproposedasanordinaryresolution:

THAT pursuanttosection551oftheCompaniesAct2006(“Act”)andinsubstitutionforallexistingauthorities,thedirectorsbeandaregenerallyandunconditionallyauthorisedtoexerciseallthepowersoftheCompanytoallotsharesintheCompany or to grant rights to subscribe for or to convert any security into shares in the Company up to an aggregate nominalamountof£3,256,252foraperiodexpiringfifteenmonthsafterthedateofthisresolutionor,ifearlier,attheconclusionofthenextAnnualGeneralMeetingoftheCompany,buttheCompanymaybeforesuchexpirymakeanofferoragreementwhichwouldormightrequiresharestobeallottedorrightstosubscribeforortoconvertanysecurityintosharestobegrantedafterexpiryofthisauthorityandthedirectorsmayallotsharesorgrantsuchrightsinpursuanceofthatofferoragreementasiftheauthorityconferredbythisresolutionhadnotexpired.

8. Toconsiderandifthoughtfit,passthefollowingresolutionwhichwillbeproposedasaspecialresolution:

THAT insubstitutionforallexistingpowersandsubjecttothepassingofresolution7,thedirectorsbeandaregenerallyempoweredpursuanttosection570oftheActtoallotequitysecurities,withinthemeaningofsection560oftheAct,forcashpursuanttothegeneralauthorityconferredbyresolution7asifsection561oftheActdidnotapplytotheallotment,foraperiodoffifteenmonthsafterthedateofthisresolutionor,ifearlier,attheconclusionofthenextAnnualGeneralMeetingoftheCompany,buttheCompanymaybeforesuchexpirymakeanofferoragreementwhichwouldormightrequireequitysecuritiestobeallottedafterexpiryofthispowerandthedirectorsmayallotsecuritiesinpursuanceofthatofferoragreementasifthepowerconferredbythisresolutionhadnotexpired,butsothattheaggregatenominalvalueoftheequitysecuritiesallottedunderthisauthoritydoesnotexceed£86,737.

By Order of the Board

E P BoyleSecretary

14May2014

RegisteredOffice:WorksRoad,LetchworthGardenCity,Hertfordshire,SG61NW

Note:Amemberentitledtoattendandvoteisentitledtoappointaproxytoattendandvoteinsteadofhimorher.AproxyneednotbeamemberoftheCompany.Seeformofproxyformoredetails.

The Annual Report - Altro

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