2e2 2011 Annual Report

2e2 Group Limited
Annual Report and Accounts 2011
Creating business advantage
2e2 leading transformational ICT

2e2 focuses on customer-centric transformational programmes relating to Employees, Customers, Citizens and the Enterprise. 2e2 has a strong track record in successfully applying technology and communication-based services to address a range of key objectives that result in reduced infrastructure costs, improved service and enhanced performance, creating business advantage for our customers.
Highlights of 2011
> Group revenues from continuing operations grew in challenging business conditions > Awarded our largest ever project, a Managed Services contract with a Health Trust, worth more than 35m > Transitioned to an industry-aligned go-to-market organisational structure > O2 Unify partnership established > Cash inflow from operations 88% of EBITDA after exceptional items and restructuring costs
2e2 has developed a new and unique approach in the provision of solutions to its customers. By combining far-reaching technical expertise with deep level business knowledge, and focusing this onto particular business areas, 2e2 is able to address the needs of its customers, seamlessly aligning IT to business priorities. The three propositions, Equipping Employees, One Contact and Could IT be Cloud, concentrate on the requirements to effectively equip employees, whether as mobile workers or as part of a contact centre, deliver excellent service to customers and stakeholders and ensure the enterprise is equipped to meet business challenges regardless of changing demands.
Contents
Highlights of 2011 01 2e2 at a glance 02 Our propositions 04 Our markets 06 Driving non-linear growth 08 Our capabilities 09 Chairmans statement 10 Chief Executives review 11 Corporate social responsibility 13 Board of Directors 14 Financial Statements 16-38 Company Information 39
2e2 Group Limited Annual Report and Accounts 2011
2e2 at a glance
What We Do
We work in partnership with our customers towards their goals through a combination of deep-level business and technical expertise, an extensive knowledge of todays technologies and market drivers including innovations around web and Cloud computing. We have a growing consultancy-based assessment practice, coupled with a mature and highly capable delivery and services infrastructure.
In a Nutshell
Established for over 10 years In the top 20 of UK Software and IT Services providers 2,000 employees with 1,200 technical consultants 17 offices in 5 countries Trusted IT advisor and partner to corporate and enterprise customers Agile and innovative approach Track record of delivering business benefits and reducing costs through transformational IT solutions High-level partnerships with the leading IT vendors Business-orientated approach and solutions design Named as the Cloud expert by the Financial Times Deep skills in data centre, unified communications, application consulting, cyber security, and managed services
2e2 has built an enviable reputation for delivering innovative and value-enhancing solutions across a range of industries and applications. We bring together business, process and IT knowledge and work with our customers to analyse their business issues and ensure that their business goals are realised. Increasingly 2e2 works to reduce IT-costs, improve efficiencies and transform the business model of our clients. This involves a deep and multi-faceted engagement that involves the key customer stakeholders, provides exceptional clarity of solution and helps underpin the achievement of their business objectives.
Tailored customer engagement Propositions
How We Deliver
Whether its to drive efficiencies within an organisation, take products to market sooner or just improve overall business effectiveness, ICT is at the heart of any change. As organisations look to implement change, this can often create a disconnect between the business strategy and the underlying ICT tools that should be supporting the transformation. Increasingly this can result in organisations seeking additional solutions to tackle growing yet avoidable costs, compromised customer service and dissatisfaction with internal ICT services. 2e2 has developed a methodology to guide our customers through this and ensure any optimal results.
Could IT be cloud
One contact
Equipping Employees
Markets
Healthcare
Commercial
Local Government
TMT
Financial Services
Capabilities
Datacentre services
Applications
End user services
Tailored Customer Engagement

2e2 has developed a series of pre-packaged consulting engagements designed to help our clients design, plan, procure and deliver the optimum ICT services to support their businesses. By focusing on business needs and process ahead of technology solutions, we are able to gain both rapid executive buy-in and provide the best advice and an optimum solution. We tailor our engagements to the specific needs of our customers businesses which are delivered with the senior client stakeholders, not to them. This ensures that accuracy, relevance and a focus upon results are built in to everything we do. What we do is solution-agnostic but done from a position of strong business and technical understanding. The outputs position our customers to make informed decisions and deliver assured results. This consultancy-led engagement model is well proven and continues to drive success across all our chosen industry sectors.
Our propositions
One contact
Could IT be cloud?
Equipping Employees
Equipping Employees
Employees across all sectors are demanding the availability of IT that allows for mobility and collaboration. With the growth of Bring Your Own Technology; the landscape is becoming more complex. Securely pushing out applications and data to employees that are always on the move is a challenge to many IT departments, and adopting a co-operative attitude between IT and business needs is vital to the success of any flexible working project. Many customers have recognised that 2e2s proposition Equipping Employees can help them as they look to address an increasingly flexible workforce with more mobile devices, posing both a technical challenge for IT staff and IT service delivery. Our EE proposition supports and enables employees to work whenever, wherever and on whatever they want People-Centric Computing all within agreed corporate bounds of course. Our consulting engagement Employee Migration Business Evaluation & Roadmap (EMBER), considers employees, user requirements, effective migration, solution adoption, training and benefits realisation, all aimed at capturing a series of recommendations designed to deliver the required ROI from the implementation of a more flexible approach to Equipping Employees.
When selecting an IT services partner, we were looking for credentials beyond the ability to deliver a Microsoft upgrade. 2e2 successfully demonstrated that it had the relevant previous experience in delivering major desktop projects to large organisations, combined with the necessary knowledge of document management that is required to deliver an upgrade of this complexity and criticality. 2e2 demonstrated solid understanding of our business processes and had the programme management and technical skills we required. Ian Makey, Head of IT & Technical Support, Linklaters
One contact
One contact Could IT One Contact be cloud?
Could IT be cloud?
For many organisations the way they engage with their own market is going through an incredible change, driven by the adoption of internet-based systems by their own customers. Equipping Our One Contact proposition has been developed to allow Employees our customers to take advantage of these media-literate information seekers, as they engage in continuous, open, peer-led discussions. Traditional Customer Relationship Management is changing to include the more collaborative elements of social media as a primary tool for driving sales. By participating in an active dialogue with customers online, sales teams are able to target very specific sets of customers with personalised, relevant propositions, informed by a detailed view of their entire interaction, engagement and conversation history.
Could Equipping Cloud? IT be
Employees Our CIBC proposition is continuing to demonstrate to our customers the clear benefits of adopting a Cloud-computing model. This provides them with services and resources on-demand and greatly increases the efficiency and adaptability of their IT departments, without having to re-engineer their entire model.
Many IT departments are taking a closer look at exactly how well they are controlling their own IT resources and services before they decide what, if anything, to place in the cloud. Our unique Flexible Infrastructure Readiness Evaluation (FIRE) is proving invaluable for many customers as they embark on the journey to the cloud. Because 2e2s capabilities extend across public and private Cloud, managed services and in-house solutions, we are perfectly placed to provide objective advice and implement the most appropriate solution for each client.
Previously, agents found it difficult to quickly find customers and tended to create duplicates as a result. The four possible entry-points people, property, reference, and service are now all crossreferenced and it is quick and easy to find customers and link enquiries to them. Shane Mills, Customer Access ICT Programme Manager, London Borough of Newham.
We knew from the outset what we wanted to achieve and whilst we are still on the road to transformation, we couldnt have accomplished everything that we have to date without 2e2. By working with them we were able to think big and remove traditional boundaries. Graham Bell, IT Director, London Borough of Waltham Forest
Our markets
Healthcare
Healthcare
Commercial
Commercial
TMT
Commercial TMT
2e2 continues to provide business and IT consulting and implementation services to Financial organisations right across the commercial sector. WeServices have many projects where we have delivered sustainable business benefits and competitive advantage for customersLocal in areas including Retail, Legal Government & Professional Services, Defence, Gaming and Utilities. Throughout this sector, the breadth of 2e2s services has helped customers implement change, drive efficiency and reduce costs.
Financial Telecommunications, Services Media and Technology
At the rootLocal TMT sector is the of the continuingGovernment need to deliver a compelling and high quality customer experience, at all times. Organisations need to deliver an improved quality of service and to enhance their customers experience, whilst aligning with the need to reduce the costs of service in operations management. 2e2 has applied its expertise in cloud services, service desk provision, device enablement and management, applications hosting and data hosting. Our use of shared infrastructure has allowed us to provide services against extremely exacting SLAs whilst keeping the cost of service low.
2e2s advice to map out our ITIL processes was absolutely key. Not only did it ensure that the one we selected was fit for purpose and that we werent paying for features that we didnt need, but it has also helped us document a lot of our intellectual property. Julie Simpson, IT Service Desk Manager, Menzies Distribution
Thanks to 2e2s knowledge of the market and strong vendor relationships, it has enabled us to already realise considerable trade-in savings. By taking a more proactive approach to asset retirement we are now able to much more effectively manage our entire technology lifecycle, thereby reducing cost. Andrew Steele, Head of ICT Platform and Infrastructure Solutions
Healthcare
Commercial
Commercial
TMT
TMT
Financial Services
Financial Services
Healthcare
Local Government
Local Finance Government
HealthCommercial
Our Financial Services focus concentrates on the three main sub sectors: Retail Investment Banking, Wealth and Fund Management and Retail Banking, with considerable success within our tier 1 & 2 Retail and Investment Banking customers. In Financial Services, 2e2 is delivering many projects that address key sector issues, including: the transformation of core banking systems, Regulation and Compliance, and the number-one driver for all of the FS sector, customer acquisition and retention.
Achieving unprecedented efficiency savings against an ongoing call for better patient care presents a huge challenge for the UK TMT Healthcare sector. This challenge comes at a time of significant organisational change making the need for flexible,Financial solutions and service agile ICT Services delivery greater than ever before. We have a 25-year heritage in providing Local ICT consultancy, solutions and managed Government services to the sector to address these challenges. Our services are helping NHS and private healthcare organisations to control and reduce their costs and to free up valuable clinical time. This was demonstrated recently when 2e2 announced it had won a seven-year contract to deliver managed IT infrastructure and data management services to the Sussex Partnership NHS Foundation Trust.
Local & Regional Government

We guide Authorities towards their goals through a combination of deep-level sector and technical expertise, an extensive knowledge of todays technologies, including innovations around web and cloud computing, and a proven, capable implementation and services infrastructure. 2e2 helps Authorities improve efficiency, reduce data centre and infrastructure costs, meet the challenges of Localism and the Big Society and address assurance and governance requirements. Our successful programmes are delivered through a mix of professional and project resource services as well as through training and consultancy. 2e2 has worked with 27 London Boroughs as well as regional local authorities and over 100 organisations within the health services sector.
We selected 2e2 because of their proven ability to deliver the complete solution and to meet all of our requirements reducing the time spent on site by IT staff was a key differentiator. 2e2 has extensive knowledge and expertise in Managed Services, which complements their wide portfolio of IPT and LAN technologies and deployments. Their excellent after-sales support offering was also a key selling point for us. Tim Mather, Head of Service Desk, Allianz Global Corporate and Speciality
This is the start of a programme to revolutionise our Information and Communications Technology, with 2e2 as our strategic partner. This vital programme will make these services fit to support our staff whether they work in hospitals, clinics or patients own homes. It will enable our staff to concentrate on what they do best providing excellent patient care. Lisa Rodrigues, Chief Executive, Sussex Partnership
As we look to manage our IT budget, it made sense to move the current finance system managed service to a SaaS model. The move will help reduce time to deploy applications, manage costs and provide improved service levels. 2e2s knowledge of ERP shared service delivery in the public sector combined with Insights expertise in the SaaS model gave us confidence working with both companies. Steve Durbin, Group Manager Applications Delivery, Bridgend County Borough Council
Driving non-linear growth
O2 Unify
We have joined forces with Telefonica O2, to create O2 Unify, a commercial joint venture combining the resources and expertise of both companies to our joint customer bases to consolidate all of their IT and communications needs under a single management umbrella. 2e2 is taking an integrated fixed and mobile offering to our customers whilst we support O2 in taking our broad range of IT Services offerings to their LME, Enterprise and TMS customers and prospects. A number of large organisations including Network Rail and G4S have taken advantage of this partnership, optimising their voice and data networks and reducing duplication across their networks. O2 Unify is ideally positioned to help customers as they face new challenges including the increasing numbers of mobile workers, the consumerisation of IT and the move to virtualised services. Customers can access technology that transforms business operations, driving productivity, efficiency and collaborative working. It offers commercial simplicity and the economies of a single IT and communications provider with the convenience of centralised reporting and billing.
Enterprise Mobility Management

Enterprises have an ever increasing need to secure a wide range of mobile devices including iPhones, tablets, Android and Windows devices. The key requirement is for a flexible and reliable security solution that delivers the core needs of fast implementation, cost effectiveness and comprehensive compliance. In conjunction with McAfee, 2e2s Cloud-based managed service takes mobile security a stage further. The flexibility of the Cloud allows for fast provisioning, cost effective implementation, scalability and minimal disruption to existing ICT infrastructure. A simple per-user, per-month pricing model adds to the simplicity and delivers a solution that can be funded from opex rather than capex.
Telefnica has provided us with a highly cost effective solution that allows us to unify our UK data and voice communications through a single provider. This new network will be key to us being able to leverage economies of scale across our ICT services and enabling business growth through easy access to corporate solutions. Julian McGovern, IT Director, G4S Secure Solutions (UK & Ireland)
We are delighted that by using 2e2s managed service implementation of McAfee Enterprise Mobility Management software, we have been able to meet all of our security requirements so quickly, with the minimum impact on normal operations. David Leach, ICT Director, Orbit Housing
Our capabilities
Our Capabilities
Our skills in delivering technology have allowed us to shape and refine our key solution offerings. The key areas that our portfolio addresses and supports are: The end user this could be the employee, the customer, citizen or a patient. The data centre infrastructure this includes migrations and upgrades from back office systems to transition to the Cloud. The entire information lifecycle this includes ensuring that our customers can keep information in the right place, access it from wherever they need to, for the length of time they need to keep it and to do this securely. We provide a breadth of professional services and programme support skills to underpin everything from successful project delivery to end user adoption and to help our customers realise ROI from their ICT investments quickly. From a single, discrete technology implementation to full outsourcing of ICT, 2e2 can help. Increasingly our customers are asking 2e2 to deliver solutions and capabilities on-premise, in our data centre or in the public cloud and ensure that regardless of where the solution is implemented it integrates seamlessly with other interdependent systems to support key business processes.
END USER
> Desktop migration and virtualisation > Enterprise mobility and security > Uni ed communications > Collaboration > Application Architecture > Back o ce services > Contact centre and case management > Information and document management > Optimisation and migration > Architecture and design > Automation and orchestration > On-premise and cloud technology
APPLIC
ATION S
DATA
CENT
RE
Our goal from the start was to have our in-house information systems resources focused on the application layer. It is important that our staff are dedicated to adding business value, and imperative that end users have the systems and data they need. By outsourcing the management of our IT infrastructure to 2e2, we are reducing management and operational costs, and are better able to concentrate on our core business. Paul Bignell, Head of IS, Tattershall Castle Group
Chairmans statement
Graham Love Chairman, 2e2 Holdings Limited
There were some excellent customer wins during the year including our largest ever project expected to be worth over 35m with a public-sector authority
I am delighted to present our Annual Report and Accounts for 2011 and the first since my appointment as Chairman. In a year of particularly challenging business conditions, Im pleased to report another strong set of results which position 2e2 well for the future. There were some excellent customer wins during the year including our largest ever project expected to be worth over 35m with a public-sector authority. In the current climate, it is more important than ever to be able to offer our customers extremely clear propositions which help them run their businesses more effectively. With our Company now organised into an industry-aligned model, we have been able to focus more on our capabilities, credentials and our many successes in each of our focused market areas. This in turn has made it easier for us to articulate to our customers the benefits which we are able to deliver to their businesses and has increased our sales momentum markedly. We will continue to focus upon developing our core markets of Financial Services, Telco, Local & Regional Government and Health as well as on the general commercial market. From a technology perspective, we will continue to build on our outstanding capabilities in Cloud-based services, cyber security and advanced storage solutions. We will also continue to develop our integrated offshore capabilities, working closely with our offshore partners, particularly in the Indian sub-continent. Our partnerships have continued to provide strong support to the business and Id like to thank all our industry partners for their assistance. Our first year of operating the O2 Unify partnership has been particularly rewarding with some excellent wins and impressive results.
2011 saw a strengthening of the 2e2 management and structure. There were several key appointments which, along with a new operating model has regularly helped us to compete and win against more established tier-one IT services players. I believe this has put us into the strongest position yet to drive the business forward towards our vision of creating the leading independent UK IT services and solutions organisation, demonstrating exceptional agility, creativity and delivering outstanding service and value. I should like to take the opportunity to thank our many customers for their support and also our employees for their dedication and hard work. I must also thank my predecessor, Eric Priestly, for the excellent work he did as Chairman up until my arrival, and also our equity investors Duke Street and Hutton Collins for their continuing support. I feel privileged to be part of 2e2 for this next part of the journey. I know that we will continue to demonstrate ourselves to be an excellent partner for our growing number of customers, and the employer of choice for our highly committed and talented staff.
Graham Love Chairman, 2e2 Holdings Limited
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Chief Executives review
Terry Burt Chief Executive Officer
2e2 is ten years old this year and the organisation has evolved into the customer-centric and easy-to-deal-with organisation that we set out to create
I am pleased to report upon a strong set of results and upon our growing and evolving organisation. During the year we once again enjoyed many excellent contract wins as both existing and new customers recognised the benefits of working with 2e2 to improve their business and deliver efficiencies and savings. During the year, we re-aligned the business to an industry-aligned go-to-market strategy. We believe this will enable us to deliver more value to customers, and should help us grow our business. Our industry partnerships continued to deliver great value to both our offerings and to our customers businesses. In particular our Unify partnership with O2 had a very successful year, meeting our growth expectations and allowing us to sign up a number of impressive new customers for the joint venture. Results Group turnover from continuing operations for the year was 396.0m (2010 Restated: 325.3m). Against a backdrop of challenging trading conditions, we saw some buying decisions delayed or deferred as the year progressed. EBITDA from continuing operations before exceptional items increased to 43.3m (2010 Restated: 36.1m). Cash inflow from operations was 88% of EBITDA after exceptional items and restructuring costs (2010 Restated: 100%).
Operational review During the year our market sector-focused organisational model and propositions reached a new state of maturity, allowing us to demonstrate more clearly our knowledge and track record, and to establish ourselves further as a trusted partner in these markets. We enjoyed good wins and progress in each of these areas. Within Financial Services we had continued success with our tier 1 & 2 Retail and Investment Banking customers. Delivering projects to address their key issues, including: the transformation of core banking systems, Regulation and Compliance, and the number one driver for all of our FS sector clients is customer acquisition and retention. In Telco we enjoyed great success with our O2 Unify venture and continued to expand our relationships, with the major telcos. In Health we have been awarded our largest ever project with a local health authority expected to be worth over 35m. At the same time we expanded and consolidated our position with several of the London health authorities, expanding our shared service for the growing North Central London Health Authority. In Local and Regional Government we launched a G-Cloud collaboration platform and quickly secured over 3,500 seats for this. We also welcomed a number of additional local authorities to our growing list of LRG customers. In our Commercial sector we saw a number of major wins across each of our focus areas: Retail, Gaming, Utilities, Legal and Defence. We have now segmented our key propositions Equipping Employees, One Contact & Could It Be Cloud to focus upon the key requirements within each of our target markets, allowing customers to easily identify and evaluate the benefits that these could bring to their organisations.
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Chief Executives review continued
O2 Unify had some excellent wins in its inaugural year of operation and we are delighted with the success and acceptance this has had. This generated considerable interest amongst O2s customers, many of whom were new to 2e2. Amongst the wins were significant multi-year contracts with Network Rail and with Group 4 Security. Working closely with our industry partners, 2e2 once again delivered some innovative and value-accretive projects to our customers. This was recognised by a number of awards including EMC 2010 Partner of the Year, Symantec Enterprise Partner of the Year, Microsoft Dynamics Regional Partner of the Year and by being named as one of the top 250 Cloud businesses worldwide. We were also named by SAP as their leading Business By Design partner, for our provision of SAP in the Cloud. We were pleased to extend our relationship with McAfee, one of the leading security software vendors, with a three-year managed services agreement. 2e2 has developed a Cloud-based security portal around their end-point security solutions, which manages and secures the growing number of mobile internet devices within organisations. The product is being sold to major telecoms service providers worldwide. During the year we disposed of two non-core business activities. Xayce provided specialist change-management consultancy and was sold to Capita. Later in the year 2e2s Dutch software integration activities were sold to a local Dutch services group. This leaves us better positioned to focus on our core business. We believe we now have our strongest UK management team ever, with several key appointments having been made in the year. Ian Thomas has joined from C&WW to head up our UK Sales organisation, David Maitland joined from AWE to head our UK Technology practices and Ian Furness joined us from Ericsson to head our operations delivery organisation. Id like to welcome them and everyone else that joined during the year, and to thank you for your hard work.
Two years into our flexible working and offshoring initiative, this is now delivering real benefits to our customers. Increasingly we are offering flexible and innovative commercial structures that allow efficiencies and cost savings to be maximised whilst maintaining customer intimacy and satisfaction levels. Many of our contracts, particularly the larger ones, now involve a blend of onshore, offshore and near-shore delivery. As we enter 2012, we are consolidating our London premises into a single location in Victoria. This will help support our continued growth and host a range of customer activities. The underlying business environment continues to be uncertain, but we believe the organisation is exceptionally well placed given current activities, our customers and our carefully-positioned offers. 2e2 is ten years old this year and the organisation has evolved into the customer-centric and easy-to-deal-with organisation that we set out to create. Many of our customers and our staff have been with us throughout the journey and many others have joined along the way. Thank you all for your support. We look forward to continuing to work with you and helping to provide efficient and effective business environments to support our customers businesses.
Terry Burt Chief Executive Officer
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Corporate social responsibility
At 2e2, we believe that people are the very heart of our business and the backbone to our long-term success. We acknowledge our responsibility to be a good corporate citizen and to make a positive difference to the world in all our engagements with our customers, employees, suppliers, partners and the general public. Through listening and responding to the needs and interests of our stakeholders, complying with local laws and regulations, demonstrating accountable, transparent and ethical business standards, mitigating risks to the environment, and protecting human rights, 2e2 is unswerving in its consideration of the economic, social and environmental impacts of all its activities. 2e2 is committed to the provision of high-quality responsible IT services and secure communications solutions supported by integrated quality, IT service, information security, health & safety, environmental, human resource and social accountability management systems. Our people 2e2 wholeheartedly supports the principles of mutual trust and respect in the workplace, fostering an environment where health and safety is paramount and diversity and inclusion are valued. We believe all staff are entitled to a safe working environment. 2e2 operates a broad and comprehensive health and safety programme across the business to ensure that risks are identified and mitigated. A recent independent health and safety, environmental and quality audit (Achilles UVDB Verify Category B2 Assessment) has endorsed our management systems, demonstrating that we are fulfilling our duty of care and providing an appropriate environment. The environment 2e2 takes its environmental responsibilities very seriously and actively manages, monitors and aims to continually reduce its energy consumption and environmental footprint. 2e2 operates an ISO14001/BS8555 Environmental Management System (EMS) that allows us to monitor and manage our environmental impact and continually to improve our performance in related areas. We have now completed the full certification of BS EN ISO 14001:2004 (Environmental Management Systems). Within our EMS we operate in accordance with the Governments Carbon Reduction Commitment scheme and aim to reduce our energy usage by a minimum of 10% in the year. To help manage and monitor this we have implemented an energy management
system that provides smart metering and analysis of our energy usage, allowing us to target specific improvement measures to greatest effect. Other aspects of the programme are focused upon reducing waste, increasing recycling, managing replacement cycles, supplier selection & vetting and ethical sourcing. 2e2s environmental programmes are monitored and assessed by BSI who recorded no major non-conformities. Quality of service 2e2 holds ISO/BSi triple certification for ISO 9001:2000 (Quality Management System), ISO/IEC 27001:2005 (Information Security Management System, and ISO/IEC 20000-1:2005 (IT Service Management System. To underpin our Quality of Service objectives, we operate and maintain an Integrated Management System (IMS) embracing best practice IT industry standards. The IMS ensures that our services fully meet or exceed the expectations of our customers through service excellence. The IMS provides an essential framework of performance reviews which enables us to ensure that continual improvement is a key process in all of our business activities. Community involvement and supporting charitable organisations For the fourth year, 2e2 has continued to support the Child Brain Injury Trust and the Research Institute for Movement Disorders Trust. We are delighted to continue to support these two worthy causes. The Child Brain Injury Trust is a UK-wide charity offering support, information and training to anyone affected by childhood acquired brain injury. More than 20,000 children will acquire a brain injury each year in the UK, resulting from accidents, illnesses such as meningitis or encephalitis, poisoning, strokes or tumours. The Research Institute for Movement Disorders researches movement disorders. The Group is currently based in Oxford Brookes Universitys Biomechanics and Human Performance Laboratories. They are currently providing rehabilitative care to patients suffering from: motor neuron disease, cerebral palsy, a stroke, multiple sclerosis, paraplegia, tetraplegia, quadraplegia, Huntingtons chorea, trauma and amputations.
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Board of Directors 2e2 Holdings Limited
From top left: Graham Love, Terry Burt, Mark McVeigh, Nick Grossman, Simon Burt, John Loveland, Matthew Collins, Frdric Chauffier.
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Graham Love
Chairman, 2e2 Holdings Ltd Graham was formerly Chief Executive of QinetiQ, a position he held from 2005 to 2009, having joined the Company in 2001. He is on the Board of STEMNET (Science, Technology, Engineering and Mathematics Network), the Advisory Board of SEMTA (Sector Skills Council for Science, Engineering and Manufacturing Technologies) and is a Principal at the Chertoff Group (a strategic advisory group focused on security, intelligence and government services). Graham is also chairman of Racing Green Cars, Eversholt Rail Group and LGC Science. Graham will help 2e2 as it develops new services for its growing customer-base and continues to provide innovative end-to-end IT solutions to both public and private sectors.
Nick Grossman
Business Development Director Nick has a background in IT services having worked in the IT industry for 30 years. He has managed a number of customer service organisations and occupied senior positions in many of the 4Front turnaround transition projects. At NCR he was responsible for the integration of 4Front and for a major reorganisation and social plan in France. He was also responsible for M&A for customer services across EMEA. Nick is responsible for mergers & acquisitions activities within 2e2 and takes a lead role in integration and strategic initiatives.
Frdric Chauffier
Non-Executive Director, 2e2 Holdings Ltd Frdric is an experienced investor having led or been involved in more than 25 leveraged buyouts since 1991, in Switzerland, Italy, France and the UK, where he was most recently Managing Partner of Duke Street, the mid-market investment firm. As a result he has accumulated a wealth of experience as Non-executive Director or Chairman of quoted and private businesses in various European countries.Frdric is a graduate of cole Suprieure des Sciences Commerciales in France and also Cornell University.
Simon Burt
Group Finance Officer & Company Secretary Simon has 10 years experience in the senior finance role within technology and service companies, both listed and private-equity backed. This includes four years as Finance Director of AIM listed Epic Group plc. Simon brings a high standard of control & professionalism to the finance function. Simon qualified as a Chartered Accountant with KPMG.
Matthew Collins
Non-Executive Director, 2e2 Holdings Ltd Matthew Collins is a founding partner of Hutton Collins Partners, a specialist provider of preferred capital. The firm, which was founded in 2002, manages three funds with aggregate commitments of some 1.5bn from a group of institutional investors including lending Banks, Insurance Companies, Pension Funds and Fund of Funds. Prior to establishing Hutton Collins, Matthew held a number of senior investment banking positions. In a 20-year career in the industry he was a Director of Morgan Grenfell & Co. Limited, Managing Director and Head of European Leveraged Finance at Bankers Trust Co. and Managing Director and Global Head of Leveraged Finance at Merrill Lynch. Matthew is a graduate of Cambridge University.
Terry Burt
Chief Executive Officer Terry is a qualified accountant, and a founder of 2e2. Terry has over 30 years experience in the IT industry including running his own software house. As COO of 4Front, Terry engineered the buy-and-build strategy and grew the business to $250m of revenues. He personally handled 23 acquisitions and disposals and drove organic growth of over 20% per annum. He managed the eventual sale of the business to NCR. At NCR he was VP of customer services for Europe, Middle East & Africa (EMEA).
John Loveland
Non-Executive Director, 2e2 Holdings Ltd Johns career spans 40 years in the IT industry. He joined ICL in 1964 and held various technical and managerial positions. In 1982 he joined Wang Computers (UK) Limited where he was Director of Customer Services, UK. In 1988 he joined Nixdorf Computers Limited which was acquired by Siemens AG, and subsequently held various senior positions within Siemens. In the last ten years John has focused on international operations. His most recent appointments were President, Siemens Business Services, North America and President, Siemens Business Services, APAC, Latin America and Africa. John retired from Siemens on 31 March 2004. John chairs the Remuneration Committee for the Group.
Mark McVeigh
Chief Operating Officer A 2e2 founder, Mark has a well-established background in sales and business management. One of the early day senior managers of 4Front, Mark was responsible for the turnaround of several 4Front acquisitions into sustainable profit-generating businesses and was personally responsible for the Norsk Data turnaround at 2e2. At NCR, Mark was VP of sales and marketing for customer services across EMEA. Mark is respsonsible for operations across the Company.
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Directors report
Registered No. 4826387
The Directors present their report and financial statements for the year ended 31 December 2011. Results and dividends The Group operating profit for the year from continuing businesses and before fundamental restructuring costs amounted to 20.0m (2010 Restated: 13.2m). The Directors do not recommend a final dividend (2010: nil). Principal activity and review of the business The principal activity of the Group is the delivery of outsourced computer services focusing on Unified Communications, Technology Solutions, Professional Consulting, Managed Services and Business Applications Solutions. During the year the UK organisation was re-aligned to an industry-aligned go-to-market structure. The services of the Group are delivered to customers in the UK and Europe. The Group continues to expand its activities through a combination of organic growth and acquisitions, and to rationalise sub-optimal operations through divestment or disposal. The retained loss for the year after taxation amounted to 8.4m (2010 Restated: 9.1m). As per last year, certain exceptional one-off costs, included within operating profit, have been highlighted on the face of the profit and loss account to give a better understanding of the underlying performance of the Group. These costs amount to 6.9m (2010: 5.5m) and relate to the integration and restructuring of the UK companies, and redundancy and restructuring costs in the Netherlands. During the year the Group disposed of two divisions of its Dutch subsidiary for a cash consideration of 0.3m and the trade and assets of Xayce Ltd for a cash consideration of 2.4m (see Note 24). Key performance indicators The senior management of the Group focuses on a number of key performance indicators. These include sales bookings and billings, the value of contracted annuity revenues, gross margins, cash conversion and staff utilisation. These, along with other measures, are monitored regularly with explanations sought for variances against expectations. Management has reviewed the key performance indicators during the year and is satisfied with the results. Future developments In the future the Group will continue to investigate suitable acquisition opportunities where it feels these will strengthen its offerings to customers. The Group is also planning to continue the integration activities in order to maximise the benefits of the increasing scale of the Group.
Principal risks and uncertainties Discussed below are the Groups major business risks, together with systems and initiatives in place to address them. Market risk The IT services market is subject to fluctuations of demand by customers. These fluctuations are linked to the economic cycle and changes in the spending patterns of customers. In addition, the Group works with a number of key vendors and it is important to maintain strong relationships and terms of business with these partners. The Company manages its cost base tightly in order to ensure that it is aligned to the level of demand. Operational risk This relates to the risk of financial loss resulting from internal processes, people and systems. The Group manages this risk through appropriate internal controls and proactive intervention, such as management reporting systems, insurances, business interruption and disaster recovery planning. During the year the Group updated its service management tools and is in the process of updating its ERP systems. Liquidity risk This relates to the risk that the Group is unable to fund its requirements because of insufficient banking facilities. The Group manages liquidity risk via revolving credit facilities, long-term debt and invoice factoring facilities. The Group maintains and reviews shortterm and long-term cash flow forecasts on a regular basis to identify ongoing cash requirements. Interest rates This relates to the risk of fluctuations in LIBOR, on which the interest charges for the Groups bank facilities are based. The Group manages interest rate risk by entering into interest rate hedging agreements in relation to its bank borrowings. Credit risk This relates to the risk that one party to a financial instrument will cause a financial loss for that other party by failing to discharge an obligation. Group policies are aimed at minimising such losses and require that deferred terms are only granted to customers who demonstrate an appropriate payment history and satisfy credit worthiness procedures. Foreign exchange risk A number of transactions are denominated in currencies other than the functional currency, which is sterling. There is a risk that the exchange rate moves between the date of the transaction and the date of settlement resulting in a financial loss. To mitigate this risk, material assets and liabilities not denominated in the functional currency are hedged by means of forward currency contracts. Going concern The Directors, after making appropriate enquiries, have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. For this reason, the Directors continue to adopt the going concern basis in preparing the financial statements.
16
Directors The Directors who served the Company during the year were as follows: T Burt M McVeigh N Grossman S Burt Directors qualifying third party indemnity provision The Company has granted an indemnity to one or more of its Directors against liability in respect of proceedings brought by third parties, subject to the conditions set out in section 234 of the Companies Act 2006. Such qualifying third party indemnity provision remains in force as at the date of approving the Directors report. Disabled employees Applications for employment by disabled persons are given full and fair consideration for all vacancies in accordance with their particular aptitudes and abilities. In the event of employees becoming disabled, every effort is made to retrain them in order that their employment with the Group may continue. It is the policy of the Group that training, career development and promotion opportunities be made available to all employees. Employee involvement The Group maintains a practice of keeping employees informed of matters affecting them as employees and the financial and economic factors affecting the performance of the Group. Policy and practice on payment of creditors It is the policy of the Group to pay all amounts due to suppliers as they fall due. As at 31 December 2011, trade creditors of the Group were equivalent to 54 days purchases (2010: 52 days). Share-based payments Employees may be awarded share options as a reward for past performance or to incentivise future performance. The options will vest if the employee remains in service for a period of four years from the date of grant. The contractual life of the options is ten years and there are no cash settlement alternatives. During the year a total of 356,500 options were granted. Corporate governance The Directors recognise the importance of adopting good corporate governance practices in the best interests of shareholders as a whole. Disclosure of information to the auditors So far as each person who was a Director at the date of approving this report is aware, there is no relevant audit information, being information needed by the auditor in connection with preparing its report, of which the auditor is unaware. Having made enquiries of fellow Directors and the Companys auditor, each Director has taken all the steps that he/she is obliged to take as a Director in order to make himself/herself aware of any relevant audit information and to establish that the auditor is aware of that information.
Auditors A resolution to reappoint Ernst & Young LLP as auditors will be put to the members at the Annual General Meeting. On behalf of the Board
Simon Burt Director 30 March 2012
17
Statement of directors responsibilities
The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations. Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and Company and of the profit or loss of the Company for that period. In preparing these financial statements, the Directors are required to: select suitable accounting policies and then apply them consistently; make judgements and estimates that are reasonable and prudent; state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business. The Directors are responsible for keeping proper accounting records that are sufficient to show and explain the Groups and Companys transactions and disclose with reasonable accuracy at any time the financial position of the Group and Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Group and Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
18
Independent auditors report

To the members of 2e2 Group Limited
We have audited the financial statements of 2e2 Group Limited for the year ended 31 December 2011 which comprise the Group Profit and Loss Account, the Group Statement of Total Recognised Gains and Losses, the Group and Company Balance Sheets, the Group statement of Cash Flows and the related notes 1 to 30. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice). This report is made solely to the Companys members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the Companys members those matters we are required to state to them in an auditors report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the companys members as a body, for our audit work, for this report, or for the opinions we have formed. Respective responsibilities of directors and auditor As explained more fully in the Directors Responsibilities Statement set out on page 18, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Boards (APBs) Ethical Standards for Auditors. Scope of the audit of the financial statements An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of: whether the accounting policies are appropriate to the companys and the Groups circumstances and have been consistently applied and adequately disclosed; the reasonableness of significant accounting estimates made by the Directors; and the overall presentation of the financial statements. In addition, we read all the financial and non-financial information in the report and financial statements to identify material inconsistencies with the audited financial statements. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report. Opinion on the financial statements In our opinion the financial statements: give a true and fair view of the state of the Groups and the parent undertakings affairs as at 31 December 2011 and of its loss for the year then ended; have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and have been prepared in accordance with the requirements of the Companies Act 2006. Opinion on other matter prescribed by the Companies Act 2006 In our opinion the information given in the Directors Report for the financial year for which the financial statements are prepared is consistent with the financial statements. Matters on which we are required to report by exception We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion: adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or the financial statements are not in agreement with the accounting records and returns; or certain disclosures of directors remuneration specified by law are not made; or we have not received all the information and explanations we require for our audit.
Kevin Harkin (Senior Statutory Auditor) For and on behalf of Ernst & Young LLP (Statutory Auditor) Reading 30 March 2012
19
Group profit and loss account

for the year ended 31 December 2011
Notes
Continuing operations 000
Discontinued operations 000
2011 Total 000
2010 Restated 000
Turnover Continuing operations Acquisitions Discontinued operations Group turnover Cost of sales Gross profit Administration expenses before exceptional items Operating profit/(loss) before depreciation, amortisation of goodwill and exceptional items* Depreciation Amortisation of intangibles Exceptional administration expenses Operating profit Continuing operations Acquisitions Discontinued operations Operating profit/(loss) Cost of fundamental restructuring Interest payable and similar charges Loss on ordinary activities before taxation Tax Loss for the financial year
* Non-statutory disclosure, presented for supplementary understanding of the financial statements.
395,970 395,970 2 395,970 (293,838) 102,132 (58,811) 43,321 (5,494) (12,814) (4,973) 20,040 20,040 3 3 6 7 22 20,040 (3,409) (20,842) (4,211) (1,142) (5,353)
7,653 7,653 (5,371) 2,282 (3,421) (1,139) (1,911) (3,050) (3,050) (3,050) (3,050)
395,970 395,970 7,653 403,623 (299,209) 104,414 (62,232) 42,182 (5,494) (12,814) (6,884) 20,040 20,040 (3,050) 16,990 (3,409) (20,842) (7,261) (1,142) (8,403)
211,983 113,282 325,265 325,265 (213,105) 112,160 (76,063) 36,097 (6,620) (10,843) (5,458) 3,280 9,896 13,176 13,176 (4,875) (17,718) (9,417) 323 (9,094)
3 3 3
20
Group statement of total recognised gains and losses

2011 000
2010 Restated 000
Loss for the financial year Currency translation differences on foreign currency net investments Total recognised gains and losses related to the year Prior year adjustment (as explained in Note 1) Total gains and losses since last annual report
(8,403) 74 (8,329) (2,903) (11,232)
(9,094) 646 (8,448)
21
Group balance sheet

at 31 December 2011
Notes
2011 000
2010 Restated 000
Fixed assets Intangible assets Tangible assets Current assets Stocks Debtors: amounts due within one year Debtors: amounts due after more than one year Cash
10 11
193,366 13,468 206,834
205,741 14,985 220,726 8,077 153,601 6,328 18,643 186,649 (172,760) 13,889 234,615 (6,086) (152,108) 76,421
13 14 14
7,828 162,312 4,200 25,587 199,927
Creditors: amounts falling due within one year Net current assets Total assets less current liabilities Provisions for liabilities Creditors: amounts falling due after more than one year Net Assets prior to Group loans falling due after more than one year* Financed by: Group loans falling due after more than one year* Capital and reserves Called up share capital Share premium account Other reserves Profit and loss account Shareholders Deficit and Net Liabilities
15
(179,033) 20,894 227,728 (6,052) (154,377) 67,299
16 17
18 21 22 22 22
79,934 105 265 516 (13,521) (12,635) 67,299
80,777 105 265 466 (5,192) (4,356) 76,421
22
Company balance sheet

at 31 December 2011
Notes
2011 000
2010 000
Fixed assets Tangible assets Investments Current assets Debtors Creditors: amounts falling due within one year Net current assets Total assets less current assets Creditors: amounts falling due after more than one year Net assets prior to Group loans falling due after more than one year* Financed by: Creditors: Group loans falling due after more than one year* Capital and reserves Called up share capital Share premium account Other reserves Profit and loss account Shareholders Funds and Net Assets
11 12
1 222 223
2 222 224 160,159 (11,921) 148,238 148,462 (61,856) 86,606
14 15
163,288 (20,009) 143,279 143,502 (58,098) 85,404
17
18 21 22 22 22
79,934 105 265 76 5,024 5,470 85,404
80,777 105 265 51 5,408 5,829 86,606
23
Group statement of cash flows

Notes
2011 000
2010 000
Net cash inflow from operating activities Returns on investments and servicing of finance Interest received Interest paid Finance lease interest paid Net cash outflow from returns on investments and servicing of finance Taxation Capital expenditure and financial investment Purchase of intangible fixed assets Purchase of tangible fixed assets Net cash outflow from capital expenditure and financial investment Acquisitions and disposals Purchase of subsidiary undertakings Net cash from purchase of subsidiary undertakings Sale of subsidiary undertakings Payments in respect of prior year acquisitions Net cash outflow from acquisitions and disposals Net cash inflow/(outflow) before financing Financing Cash outflow of borrowings Cash inflow of loans from parent undertaking Finance leases Net cash (outflow)/inflow from financing Increase in cash
23(a)
28,249
25,578
58 (13,543) (42) (13,527) 988
66 (14,779) (100) (14,813) 455
(1,769) (4,153) (5,922) 2,316 (2,367) (51) 9,737 (1,906) (887) (2,793) 23(b) 6,944
(6,051) (6,051) (69,629) 11,435 (58,194) (53,025) (4,561) 76,351 (662) 71,128 18,103
24
Notes to the financial statements

at 31 December 2011
1. Accounting policies Basis of preparation and change in accounting policy The financial statements are prepared under the historical cost convention and in accordance with applicable accounting standards. In preparing the financial statements for the current year, the Group has changed its accounting policy for revenue recognition on managed service contracts. The business had historically recognised revenue at the point a contract was awarded to a value reflecting the work carried out, but before the finalisation of the final terms and conditions of the contract. As projects have become larger and more complex, contract terms and conditions often take longer to negotiate. The Group has adjusted its policy and now recognises revenues only where a contractual relationship is established. Evidence might take the form of a signed contract, purchase order or an invoice to the customer for services. In the event that a contractual relationship is not established during the period, the Group will recognise revenue associated with the contract where there is a reasonable expectation that the Group will recover the pre-contract costs. In order to determine the prior year adjustment value, the Group reviewed each contract relevant to the revenue taken and identified the date that the contractual relationship was established. An adjustment has been made where the contractual relationship was established outside of the prior-year period. In these cases, the Group does not consider it prudent to recognise any revenue to recover pre-contract costs due to the amount of time that has passed and the difficulty in identifying any costs incurred. In light of the materiality of the amounts involved, the Directors are of the opinion that it is appropriate to adjust the comparatives for the year ended 31 December 2010 retrospectively and therefore the effect has been treated as a prior-year adjustment. The Directors believe this will ensure that the results for the current period are not distorted and that the prior periods have the correct amount of revenue and profits. The effect of this adjustment is to increase the loss after tax by 1.8m for the year ended 31 December 2010 and reduce net assets by 2.9m as at that date, including a 2.9 million reduction to retained reserves brought forward at 1 January 2011. Basis of consolidation The Group financial statements consolidate those of the Company and of all its subsidiary undertakings (see Note 12), drawn up to 31 December 2011. The acquisition method of accounting has been adopted for acquisitions. Under this method the results of the subsidiary undertakings acquired or disposed of in the year are included in the profit and loss account from the date of acquisition or up to the date of disposal. In the Companys financial statements, investments in subsidiary undertakings are stated at cost less any provisions for diminution in value. In accordance with section 408 of the Companies Act 2006, 2e2 Group Limited is exempt from the requirement to present its own profit and loss account. Goodwill Goodwill arising on consolidation, representing the excess of the fair value of the consideration given over the fair values of the identifiable net assets acquired, is capitalised and is amortised on a straight-line basis over its estimated useful economic life, generally 20 years. It is reviewed for impairment at the end of the first full financial year following the acquisition and in other periods if events or changes in circumstances indicate that the carrying value may not be recoverable. Negative goodwill is written back to the profit and loss account to match the recovery of the non-monetary assets acquired. Intangible assets-development costs An internally generated intangible asset arising from the Groups development activities is recognised if all of the following conditions are met: An asset is created that can be separately identified; It is probable that the asset created will generate future economic benefits; and The development cost of the asset can be measured reliably. Internally generated intangible assets are amortised on a straight-line basis over their useful lives. The carrying value of intangible assets are reviewed for impairment if events or changes in circumstances indicate the carrying value is not recoverable.
25
Notes to the financial statements continued

at 31 December 2011
1. Accounting policies continued Turnover Sales of Goods Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods and services provided in the normal course of business, net of discounts, VAT and other sales-related taxes. Sales of goods are recognised when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on despatch. Rendering of services Revenue from the provision of services is recognised on a time and materials basis in the period in which the services are provided. Managed service contracts Where the outcome cannot be estimated reliably, revenue is recognised to the extent that costs incurred will probably be recovered. When it is probable that total contract costs will exceed total contract revenues, the expected loss is recognised as an expense immediately. Tangible fixed assets Tangible fixed assets are stated at cost or valuation, net of depreciation and any provision for impairment. Depreciation is calculated to write down the cost of all tangible fixed assets by equal annual instalments over their estimated useful economic lives or lease term if shorter. The rates generally applicable are: Leasehold improvements Term of the lease Computer equipment 3 4 years Fixtures and fittings 4 years Motor vehicles 4 years Rental assets 2 3 years The carrying value of tangible assets are reviewed for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. Investments Investments are included at cost less amounts written off. Stocks Stocks are stated at the lower of cost and net realisable value. Net realisable value is based on estimated selling price less any further costs expected to be incurred to completion and disposal. Long-term contracts The attributable profit on long-term contracts is recognised once their outcome can be assessed with reasonable certainty. The profit recognised reflects the proportion of work completed to date on the project. Costs associated with long-term contracts are included in stock to the extent that they cannot be matched with contract work accounted for as turnover. Long-term contract balances included in stocks are stated at cost, after provision has been made for any foreseeable losses and the deduction of applicable payments on account. Full provision is made for losses on all contracts in the year in which the loss is first foreseen. Deferred taxation Deferred taxation is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or events have occurred at that date that will result in an obligation to pay more, or right to pay less or to receive more, tax, with the following exceptions: Provision is made for deferred taxation that would arise on remittance of the retained earnings of subsidiaries, associates and joint ventures only to the extent that, at the balance sheet date, dividends have been accrued as receivable; and Deferred tax assets are recognised only to the extent that the Directors consider that it is more likely than not that there will be suitable taxable profits from which the future reversal of the underlying timing differences can be deducted. Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which timing differences reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date.
26
1. Accounting policies continued Foreign currencies Transactions in foreign currencies are translated at the exchange rate ruling at the date of the transaction. Monetary assets and liabilities in foreign currencies are translated at the rates of exchange ruling at the balance sheet date. The financial statements of foreign subsidiaries are translated at the rate of exchange ruling at the balance sheet date. The exchange differences arising from the retranslation of the opening net investment in subsidiaries are taken directly to reserves. Where exchange differences result from the translation of foreign currency borrowings raised to acquire foreign assets they are taken to reserves and offset against the differences arising from the translation of those assets. All other exchange differences are dealt with through the profit and loss account. Research and development Research and development expenditure is charged to the profit and loss account in the period in which it is incurred. Interest rate swaps The Groups criteria for interest rate swaps are: The instrument must be related to an asset or liability; and It must change the character of the interest rate by converting a variable rate to a fixed rate or vice versa. Interest differentials are recognised by accruing with net interest payable. Interest rate swaps are not revalued to fair value or shown on the Group balance sheet at the year end. If they are terminated early, the cost is spread over the remaining maturity of the original instrument. Interest-bearing loans All interest bearing loans and borrowings are initially recognised at net proceeds. After initial recognition debt is increased by the finance cost in respect of the reporting period and reduced by repayments made in the period. Finance costs of debt are allocated over the term of the debt at a constant rate on the carrying amount. Costs associated to raising the debt are held on the balance sheet and recognised in the profit and loss account over the term of the corresponding debt. Leasing and hire purchase commitments Assets held under finance leases and hire purchase contracts are capitalised in the balance sheet and depreciated over their estimated useful economic lives. The interest element of leasing payments represents a constant periodic rate of charge on the remaining balance of the obligation for each accounting period and is charged to the profit and loss account over the period of the lease. All other leases are regarded as operating leases and the payments made under them are charged to the profit and loss account on a straightline basis over the lease term. Provisions A provision is recognised when the Group has a legal or constructive obligation as a result of a past event and it is probable that an outflow of economic benefits will be required to settle the obligation. Pensions The Group operates a number of defined contribution pension schemes. Contributions are charged in the profit and loss account as they become payable. Share-based payments The Group issues equity-settled share-based payments to certain employees and advisers. Equity-settled share-based payments are measured at fair value (excluding the effect of non market-based vesting conditions at the date of grant). The fair value so determined has been expensed on a straight-line basis over the vesting period, based on the Groups estimate of the number of shares that will eventually vest, and adjusted for the effect of non-market vesting conditions. Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any cost not yet recognised in the income statement for the award is expensed immediately. Any compensation paid up to the fair value of the award at the cancellation or settlement date is deducted from equity, with any excess over fair value being treated as an expense in the income statement. Fair value is measured using a Black-Scholes-Merton option pricing model. The key assumptions used in the model have been adjusted, based on managements best estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations.
27

at 31 December 2011
2. Turnover Turnover represents the amounts derived from the provision of goods and services, which is stated net of value added tax and is attributable to one principal activity, as stated in the Directors report. An analysis of turnover by geographical market is given below:
2011 000 2010 Restated 000
United Kingdom (including the Channel Islands and the Isle of Man) Europe Rest of world
306,154 94,770 2,699 403,623
243,800 75,435 6,030 325,265
3. Operating profit This is stated after charging/(crediting):

2011 000 2010 000
Auditors remuneration
Depreciation and amortisation
audit services UK overseas non-audit services goodwill (Note 10) development costs (Note 10) tangible fixed assets owned held under finance leases and hire purchase contracts
FRS 20 share option charges Other operating lease rentals land and buildings Exceptional restructuring and integration costs Exceptional restructuring costs The restructuring costs relate to the following activities:
330 98 130 12,100 714 4,662 832 27 4,697 6,884
375 89 134 10,843 6,025 595 6,422 5,458
2011 000
2010 000
Restructuring costs and redundancy costs in the UK Group Restructuring costs and redundancy costs in the Netherlands Group Restructuring costs and redundancy costs in Other Divisions
3,631 1,869 1,384 6,884
3,745 1,362 351 5,458
Fundamental restructuring costs In 2011, the Group incurred costs of 3.4m in relation to fundamental restructuring costs. These costs were incurred as part of the completion of the integration of Morse plc, acquired in 2010 and the offshoring of certain services to Patni Computer Systems. In 2010, the Group incurred costs of 4.9m in relation to a fundamental reorganisation. These costs were incurred as a result of the reorganisation of the management and operations within the UK business following the acquisition and subsequent integration of Morse plc. The businesses had previously been organised as separately managed corporate entities. The reorganisation of the operations included the transfer of certain services to Patni Computer Systems, our offshore service provider. 4. Directors remuneration Directors remuneration has been borne by fellow group company 2e2 Holdings Limited.
2011 000 2010 000
Remuneration Pension contributions to money purchase pension schemes
1,218 117 1,335
841 93 934
The amounts set out above include remuneration in respect of the highest paid Director for the year as follows:
2011 000 2010 000
Remuneration Pension contributions to money purchase pension schemes During the year three Directors participated in money purchase pension schemes (2010: four).
451 47
268 52
28
5. Staff costs
2011 000 2010 000
Wages and salaries Social security costs Other pension costs
89,654 11,500 2,073 103,227
71,574 8,773 1,867 82,214
On the acquisition of Morse plc in June 2010, 2e2 Group assumed the defined benefit pension liabilities which may arise under the South Tyneside & Gateshead (ST&G) Building Schools for the Future contract. A provision of 0.9m is maintained in the balance sheet and is based on an actuarial valuation carried out in 2011. At 31 December 2011, there were 16 employees in the pension scheme. The average monthly number of employees during the year was made up as follows:
2011 No. 2010 No.
Management and administration Sales and marketing Operations
240 308 1,421 1,969
237 265 1,115 1,617
6. Interest payable and similar charges

2011 000 2010 000
Interest payable on bank loans Finance charges in respect of finance leases Other interest receivable and similar income
20,894 148 21,042 (200) 20,842
17,684 100 17,784 (66) 17,718
7. Tax (a) Tax on loss on ordinary activities The tax charge is made up as follows:
2011 000 2010 Restated 000
Current tax: Overseas taxation Adjustments in respect of prior years Total current tax (Note 7(b)) Deferred tax: Origination and reversal of timing differences Total deferred tax Tax on loss on ordinary activities
1,772 (630) 1,142 1,142
(323) (323) (323)
(b) Factors affecting tax charge for the year The tax assessed for the year differs from the standard rate of corporation tax in the UK of 26.5% (2010: 28%). The differences are explained below:
2011 000 2010 Restated 000
Loss on ordinary activities before tax Loss on ordinary activities multiplied by standard rate of corporation tax in the UK of 26.5% (2010: 28%) Effects of: Expenses not deductible for tax purposes Decelerated capital allowances Utilisation of tax losses Adjustments to tax charge in respect of previous years Group relief received Other short-term timing differences Current tax for the year (Note 7(a))
(7,261) (1,924) 5,567 1,077 (2,410) (630) (149) (389) 1,142
(9,417) (2,637) 8,201 1,191 (7,342) (200) 464 (323)
29

at 31 December 2011
8. Loss for the financial year The Companys loss for the year ended 31 December 2011 was 0.4m (2010: 0.1m). 9. Dividends No dividends were paid or declared during the year (2010: nil). 10. Intangible fixed assets
Group
2011 000 2010 000
Goodwill and development costs

Negative Goodwill 000 Total Goodwill 000
193,366
Development costs 000
205,741
Total intangibles 000
Group
Goodwill 000
Cost: At 1 January 2011 Adjustments Additions Disposals (See Note 24) At 31 December 2011 Amortisation: At 1 January 2011 Provided in year Disposals At 31 December 2011 Net book value: At 31 December 2011 At 1 January 2011
240,672 425 (1,809) 239,288 (36,695) (12,100) 54 (48,741) 190,547 203,977
(2,772) (2,772) 2,772 2,772
237,900 425 (1,809) 236,516 (33,923) (12,100) 54 (45,969) 190,547 203,977
2,135 1,769 3,904 (371) (714) (1,085) 2,819 1,764
240,035 425 1,769 (1,809) 240,420 (34,294) (12,814) 54 (47,054) 193,366 205,741
The amounts included within adjustments are revisions to the provisional goodwill arising on the acquisition of Morse plc in June 2010. The adjustments reflect increases in the fair value of provisions in respect of onerous property leases (0.4m), dilapidation costs (0.3m) and defined benefit pension liabilities (0.2m) partly offset by reductions in respect of accrued income provisions (0.4m) and cost accruals (0.1m). The goodwill that has arisen on all acquisitions is being amortised evenly over the estimate of the useful economic life of 20 years. 11. Tangible fixed assets
Leasehold improvements 000 Motor vehicles 000 Fixtures, fittings and computer equipment 000 Total 000
Group
Cost: At 1 January 2011 Additions Disposals At 31 December 2011 Depreciation: At 1 January 2011 Provided in the year Foreign Exchange Disposals At 31 December 2011 Net book value: At 31 December 2011 At 1 January 2011
3,484 3,484 (1,795) (210) (2,005) 1,479 1,689
216 42 (77) 181 (173) (26) 72 (127) 54 43
26,793 4,111 (753) 30,151 (13,540) (5,258) 7 575 (18,216) 11,935 13,253
30,493 4,153 (830) 33,816 (15,508) (5,494) 7 647 (20,348) 13,468 14,985
The net book value of fixed assets includes 1.4m (2010: 1.0m) for computer and other equipment in respect of assets held under finance leases and hire purchase contracts.
30
11. Tangible fixed assets continued

Company
Computer equipment 000
Cost: At 1 January 2011 Additions At 31 December 2011 Depreciation: At 1 January 2011 Provided in the year At 31 December 2011 Net book value: At 31 December 2011 At 1 January 2011 12. Investments
Company
8 8 (6) (1) (7) 1 2
Investment in subsidiary undertakings 000
At 1 January 2011 and 31 December 2011
222
The Company owns either directly or indirectly 100% of the ordinary share capital of the following principal subsidiary companies, the principal activities of which are the provision of computer services: Incorporated in the United Kingdom (including the Channel Islands and the Isle of Man) 2e2 Limited 2e2 Offshore Limited Netstore Limited Morse Group Limited Diagonal Solutions Limited Xayce Limited Incorporated in the Netherlands 2e2 Tradecom International B.V. 2e2 Group B.V. 2e2 Yul Data Security B.V. Incorporated in Spain Morse Spain SL Incorporated in Ireland Morse Computer Group Limited All subsidiaries are held indirectly with the exception of 2e2 Limited which is held directly. 13. Stocks
Group 2011 000 Company 2011 000 Group 2010 000 Company 2010 000
2e2 UK Limited 2e2 Property Group Limited Morse Overseas Holdings Limited Morse Limited Diagonal Consulting Limited
2e2 Dynomic B.V. 2e2 Motifact Group B.V.
Spare parts Goods for resale Other stock
1,667 5,823 338 7,828
2,037 5,966 74 8,077
31
14. Debtors
Group 2011 000 Company 2011 000 Group 2010 Restated 000 Company 2010 000
Trade debtors Amounts owed by Group undertakings Prepayments and accrued income Deferred tax asset (Note 20)
69,609 90,575 6,328 166,512
163,288 163,288
95,832 57,769 6,328 159,929
160,159 160,159
Included in the above are the following amounts that are due after more than one year:
Deferred tax asset 15. Creditors: amounts falling due within one year
4,200
6,328
Group 2011 000
Company 2011 000
Group 2010 000
Company 2010 000
Bank loans Trade creditors Tax and social security Accruals Deferred income Amounts due under finance leases
6,787 64,558 17,614 44,595 44,754 725 179,033
20,005 4 20,009
6,400 75,395 10,717 45,723 34,105 420 172,760
11,898 6 17 11,921
16. Provisions for liabilities

Property 000 Dilapidations 000 Other 000 Total 000
At 1 January 2011 Arising during the year Utilised during the year At 31 December 2011 Current 2011 Non-current 2011
3,358 800 (881) 3,277 791 2,486 3,277
1,132 311 (181) 1,262 1,262 1,262
1,596 200 (283) 1,513 1,513 1,513
6,086 1,311 (1,345) 6,052 791 5,261 6,052
Property The property provision is made up of 3.0m in 2e2 UK Ltd in respect of the exit of two properties as part of the Morse integration and 0.3m in 2e2 Property Ltd whereby the sub-tenant is entitled to exit the property before 2e2 Property Ltds lease expiry date. Dilapidations The dilapidations provision reflects a liability as at 31st December 2011 for potential costs that the businesses are likely to incur to bring all properties to the same state as required by the lease contract. Other Other provisions include 0.5m for potential refund claims on products sold during the last five years and 0.9m in 2e2 UK Ltd for defined benefit pension liabilities which may arise under the South Tyneside & Gateshead Building Schools for the future contract.
32
17. Creditors: amounts falling due after more than one year
Deferred income Bank loans Amounts owed to Group undertakings Amounts due under finance leases
1,101 152,739 537 154,377
58,098 58,098
1,927 149,927 254 152,108
61,856 61,856
The bank loans are secured by a fixed and floating charge over all the assets of the Group. The bank loans consist of the following facilities: Term Loan A in the amount of 25.2 million is repayable in instalments. A total of 6.8 million is repayable within one year with the balance payable in instalments finishing on 30June2015. Interest is charged at the rate of LIBOR plus 2.25% to 4.50%. Term Loan B in the amount of 37.5 million is repayable in a single instalment on 10October2016. Interest is charged at the rate of LIBOR plus 3.00% to 5.00%. Term Loan C in the amount of 37.5 million is repayable in a single instalment on 10October2017. Interest is charged at the rate of LIBOR plus 5.50%. Revolving Facility in the amount of 18.4 million is repayable in a single instalment on 30September2013. Interest is charged at the rate of LIBOR plus 2.25% to 4.50%. Mezzanine Facility in the amount of 35.0 million is repayable in a single instalment on 10October2018. Interest is payable at the rate of LIBOR plus 16.00%. 11.00% of the interest is not due for payment and rolls up until 10 October 2018. Amounts due under finance leases are secured on the assets to which they relate. 18. Creditors: Group loans falling due after one year
Amounts due to Group undertakings
79,934
79,934
80,777
80,777
The Directors have included the amounts due to Group undertakings separately from other Group debt and disclosed it separately on the basis that the debt is not due for payment until 2020. The Directors believe that this additional disclosure aids the user in understanding the funding structure of the Group and in helping their understanding of the financial statements. 19. Borrowings Borrowings are repayable as follows:
Within one year: Bank and other borrowings Finance leases After one and within two years: Bank and other borrowings Finance leases After two years and within five years: Bank and other borrowings Finance leases After five years: Bank and other borrowings Less: issue costs
6,787 725 7,585 537 66,701 161,277 (2,890) 240,722
20,005 138,032 158,037
6,400 420 6,800 254 31,894 195,471 (3,461) 237,778
11,898 142,633 154,531
Bank and other borrowings repayable after five years comprise:

Bank borrowings Accrued interest Amounts owed to Group undertakings
72,428 8,915 79,934 161,277
138,032 138,032
110,000 4,694 80,777 195,471
142,633 142,633
33

at 31 December 2011
19. Borrowings continued On 10 October 2008, the Company entered into a cross guarantee in the amount of 165,000,000, in favour of its bankers in respect of the borrowings of the Group. Following the acquisition of Morse plc by 2e2 Ltd on 21 June 2010, the Company entered into a cross guarantee on 21 June 2010 for the amount of 85,000,000, in favour of certain investors. Through its Spanish business unit, the Group has access to customer-specific funding through debt factoring arrangements with a number of financing institutions in Spain. Morse Spain SL receives funds from the financing institutions which are then repaid as cash is received from the customer. At 31 December 2011 the outstanding borrowings balance was 5.9m (2010: 3.9m) through the without recourse debt factoring agreement. Interest is charged at different rates depending on the financial institution ranging from EURIBOR + 1.25% to EURIBOR + 4.41%. 20. Deferred taxation Deferred taxation recognised in the financial statements is set out below (Note 14):
Assets: Depreciation in excess of capital allowances and other short-term timing differences The movement in deferred tax is as follows:
6,328
6,328
Group and Company 000
At 1 January 2011 and 31 December 2011 Unrecognised deferred tax Unrecognised deferred taxation is set out below:
Group 2011 000 Company 2011 000 Group 2010 000
6,328
Company 2010 000
Assets: Depreciation in excess of capital allowances Other short-term timing differences Tax losses carried forward Total tax losses carried forward
4,650 190 13,610 18,450
14 14
4,105 1,865 17,429 23,399
15 15
In Budget 2011 on 23 March 2011, the Chancellor of the Exchequer announced a reduction in the UK rate of corporation tax to 26%. This reduced rate applied from 1 April 2011 and was enacted using secondary legislation, called the Provisional Collection of Taxes Act. A further 1% rate reduction to 25% was also announced and it was intended that this would be effective from 1 April 2012. However, in his budget of 21 March 2012, the Chancellor of the Exchequer announced a number of further changes to the UK Corporation Tax rate. These included a reduction in the UK corporation tax rate from 25% to 24% effective from 1 April 2012 (substantively enacted as of 26 March 2012 and dealt with by Resolution under the Provisional Collection of Taxes Act). The UK Government intends to further reduce the UK corporate income tax rate, to 22%, in annual increments of 1% per annum which will be enacted in successive Finance Bills. Consequently, the Company will only recognise the impact of the rate change which is substantively enacted at that time in its financial statements. However, for indicative purposes only, the Company has shown the effect of the proposed reduction in the corporate income tax rate for each year on the gross deferred tax asset recognised as at 31 December 2011 as follows: 31 December 2011 (substantively enacted tax rate = 25%) 31 December 2012 (substantively enacted tax rate = 24%) 31 December 2013 (substantively enacted tax rate = 23%) 31 December 2014 (substantively enacted tax rate = 22%) 6,328,300 6,075,168 5,822,036 5,568,904
Further, from 1 April 2012, there will be a 2% reduction in the rates of capital allowances, the main rate pool going down from 20% to 18% and the special rate pool from 10% to 8%.
34
21. Issued share capital

Group and Company Allotted, called up and fully paid
No. 2011 000 No. 2010 000
Ordinary shares of 0.04 each
2,637,250
105
2,637,250
105
Share option reserve The Groups parent undertaking, 2e2 Holdings Limited operates a share option scheme which is open to all employees of the Group at the discretion of the board of 2e2 Holdings Limited. The Group records a charge in accordance with FRS 20 for options to acquire shares of 2e2 Holdings Limited that are granted to employees of the Group. In the scheme the options typically vest based on the following pattern, 50% on the second anniversary of the date of grant and a further 25% on the third and fourth anniversaries; the options also vest on the listing on a public market or the sale of 2e2 Holdings Limited. The options lapse if they remain unexercised after 10 years from the date of grant. The options also lapse following the employee leaving the Group. There were 366,245 share options outstanding at the year end (2010: 44,250). The fair values were calculated using a Black-Scholes-Merton model. The inputs into the model were as follows:
2011 2010
Weighted average share price Weighted average exercise price Expected volatility Risk-free rate Expected dividend yield
1.50 1.50 35 to 40% 0.5% nil
1.00 1.00 35.5% 4.25% nil
Expected volatility was determined using as a base the share price movements recorded over the same period as the vesting period (from grant date to vesting date) and taking into account any specific factors impacting during the period. The expected life used in the model has been adjusted, based on managements best estimate for the effects of non-transferability, exercise restrictions and behavioural considerations. There were 366,245 outstanding at the year end (2010: 44,250). There were 356,500 options granted in the year. During the year 38,930 options were forfeited whilst 85,000 options were forfeited after the year end as a result of employees leaving. For the share options outstanding as at 31 December 2011, the weighted average remaining contractual life is nine years (2010: six). The Group recognised total charges of 26,568 related to equity-settled share-based payment transactions during the year (2010: nil). 22. Movements on reserves
Share premium account 000 Other reserves 000 Restated Profit and loss account 000
Group
At 1 January 2011 as reported Prior year adjustment (Note 1) Restated at 1 January 2011 Retained loss for the year FRS20 charge Currency translation differences on foreign currency net investments At 31 December 2011
265 265 265

Share premium account 000
466 466 27 23 516
(2,289) (2,903) (5,192) (8,403) 74 (13,521)

Profit and loss account 000
Company
Other reserves 000
At 1 January 2011 FRS20 charge Retained loss for the year At 31 December 2011
265 265
51 25 76
5,408 (384) 5,024
35

at 31 December 2011
23. Notes to the statement of cash flows (a) Net cash inflow from operating activities
2011 000 2010 Restated 000
Operating profit Cash impact of fundamental restructuring Amortisation of goodwill Amortisation of development costs Adjustment to goodwill Depreciation of tangible fixed assets Decrease/(Increase) in stock (Increase) in debtors Decrease in creditors Loss on sale of subsidiary operations Loss/(profit) on sale of fixed assets Net cash inflow from operating activities (b) Reconciliation of net cash inflow to movement in debt
16,990 (3,409) 12,100 714 (425) 5,494 249 (9,099) 4,661 987 (13) 28,249
13,176 (4,875) 10,843 6,620 (3,209) (32,077) 35,064 36 25,578
2011 000
2010 000
Cash inflow in cash in the year Cash flow from financing Cash flow from amounts due to parent Change in net debt resulting from cash flows Finance leases Non-cash movements Movement in net debt Net debt at 1 January 2011 Net debt at 31 December 2011 (c) Analysis of net funds/(debt)
At 1 January 2011 000 Cash flow 000
6,944 1,906 8,850 887 (5,737) 4,000 (219,135) (215,135)
18,103 5,223 (76,351) (53,025) (2,700) (55,725) (163,410) (219,135)
Non cash changes 000
At 31 December 2011 000
Cash at bank Borrowings from parent Long-term loans Finance leases
18,643 (80,777) (156,327) (674) (219,135)
6,944 1,906 887 9,737
843 (5,105) (1,475) (5,737)
25,587 (79,934) (159,526) (1,262) (215,135)
24. Disposals During the year the Group disposed of the trade and assets of Xayce Ltd for a cash consideration of 2.4m. The results of the Group for the year include revenue of 248,000 and profit of 16,000 from the trading activities of Xayce up to its date of disposal on 2 February 2011.
36
24. Disposals continued Net assets disposed of were as follows:

000
Debtors Net assets Goodwill Loss on disposal Satisfied by: Cash Fees
603 603 1,754 (25) 2,332 2,408 (76) 2,332
During the year, the Group disposed of the trade and assets of two divisions of its Dutch subsidiary for a cash consideration of 0.3m. A third division remains and continues to trade within the Group. The results of the Group for the year include revenues of 7,405,000 and a loss of 1,143,000 from the trading activities of these two divisions up to the date of disposal on 31 October 2011. Net assets disposed of were as follows:
000
Tangible Fixed Assets Debtors Creditors Net assets Loss on disposal Satisfied by: Cash Fees
196 1,914 (1,164) 946 (962) (16) 295 (311) (16)
25. Interest rate swaps The Group purchases interest rate swaps to manage the Groups exposure to floating interest rates. At the balance sheet date the interest rate swaps held by the Group were as follows: Hedged amount at period end: 50.0m Final maturity date: from 31 December 2011 to 31 December 2012 Fixed rate payable 1.18% Floating rate receivable GBP LIBOR BBA 26. Capital commitments The Group had no capital commitments at 31 December 2011 (2010: nil).
37

at 31 December 2011
27. Contingent liabilities There were no contingent liabilities at 31 December 2011 (2010: nil). 28. Other financial commitments Operating lease payments amounting to 1.4m (2010: 2.5m) are due within one year. The leases to which these amounts relate expire as follows:
Land and buildings 2011 000 Other 2011 000 Land and buildings 2010 000 Other 2010 000
Operating leases which expire: Within one year In one to five years Over five years
767 2,810 2,460 6,037
623 679 1,302
814 2,415 1,449 4,678
1,633 2,052 3,685
29. Related party transactions The Group has taken advantage of the exemption available to wholly owned subsidiary undertakings under FRS 8 (Related Party Transactions), and accordingly has not provided details of its transactions with entities forming part of the 2e2 Group. 30. Ultimate parent undertaking and controlling party The Companys ultimate parent undertaking is 2e2 Holdings Limited, a company incorporated in the United Kingdom. 2e2 Holdings Limited is the only Group which consolidates these accounts and its financial statements are available from its registered address of The Mansion House, Benham Valence, Newbury, RG20 8LU. The Companys immediate parent undertaking is 2e2 Investments Limited.
38
Company information
Directors T Burt M McVeigh N Grossman S Burt Secretary S Burt Auditors Ernst & Young LLP Apex Plaza Forbury Road Reading Berkshire RG1 1YE Bankers Royal Bank of Canada Thames Court One Queen Hithe London EC4V 4DE HSBC Bank plc 70 Pall Mall London SW1Y 5EZ Lloyds Banking Group plc 25 Gresham Street London EC2V 7HN Barclays Bank plc 1 Churchill Place London E14 5HP Solicitors DLA Piper UK LLP 3 Noble Street London EC2V 7EE Registered Office The Mansion House Benham Valence Newbury Berkshire RG20 8LU United Kingdom
39
Notes
40
FSC LOGO TO GO HERE
2e2 Group Limited The Mansion House Benham Valence Newbury Berkshire RG20 8LU
T +44 (0) 1635 568 000 F +44 (0) 1635 568 001
info@2e2.com www.2e2.com

2e2 2011 Annual Report

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Group profit and loss account

Continuing operations 000

Discontinued operations 000

2011 Total 000

2010 Restated 000

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2010 Restated 000

(8,403) 74 (8,329) (2,903) (11,232)

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Group balance sheet

2010 Restated 000

193,366 13,468 206,834

7,828 162,312 4,200 25,587 199,927

(179,033) 20,894 227,728 (6,052) (154,377) 67,299

79,934 105 265 516 (13,521) (12,635) 67,299

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* Non-statutory disclosure, presented for supplementary understanding of the financial statements.

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Company balance sheet

2 222 224 160,159 (11,921) 148,238 148,462 (61,856) 86,606