Alliance Pharma PLC (APH) 2014年年度報告「LSE」.pdf

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1、2014 Annual ReportALLIANCE PHARMA plcAnnual Report andAccounts for the year ended 31 December 2014ContentsAlliance Pharma plc|Annual Report 2014Alliance Pharma plc is an AIM listed specialitypharmaceutical companyAlliance has a strong track record of acquiring the rights to established niche product

2、s and owns orlicences the rights to more than 60 pharmaceuticalproducts and continues to explore opportunities toexpand the range.The group commenced trading in1998 and has since grown to an annual turnover of43m.Alliance has its headquarters in the UK atChippenham,Wiltshire.Strategic Report 12 Boar

3、d of Directors 16 Senior Team Members 18 Corporate Governance 19 Directors Remuneration 20 Other Matters 22 Independent Auditors Report 24 to the Members of Alliance Pharma plc Consolidated Income Statement 25 Consolidated Statement of Comprehensive Income 26 Consolidated Balance Sheet 27 Company Ba

4、lance Sheet 28 Consolidated Statement of 29 Changes in Equity Company Statement of 30 Changes in Equity Consolidated and Company 31 Cash Flow Statements Notes to the Financial Statements 32 Shareholder Information 65 Five Year Summary 66 Advisors 67*Unaudited information.Business Summary*Report of t

5、he DirectorsFinancial StatementsSupplementary Information*Highlights 01 Our Business Model 02 Growth through Acquisitions 05 Growth through Healthcare 06 Professionals Growth through Consumer 08 Markets Growth through International 10 Expansion Highlights01Alliance Pharma plc|Annual Report 2014Busin

6、ess SummaryDIVIDENDSALES2010|2011|2012|2013|201448.044.142.445.343.52010|2011|2012|2013|201412.910.710.812.010.811.02010|2011|2012|2013|2014Restated due to the adoption of IFRS 11.12.38.72010|2011|2012|2013|20143.963.623.613.813.362010|2011|2012|2013|20140.570.750.8250.9081.00043.5mPROFIT BEFORE TAX

7、*10.8m10.3m1.000pEPS BASIC*3.36pFREE CASHFLOWKeyNUMBERS8.210.3*Before exceptional item,being impairment of Pavacol-D intangible.KeyFACTSAcquisition of Irenat,ourfirst German product,inJanuary 2014 contributing0.8m to sales in 2014Acquisition of fast-growingMacuShield brand inFebruary 2015Hydromol co

8、ntinues todemonstrate good growth,achieving year on yearsales growth of 15%Ashton&Parsons InfantsPowders sales achieve very significant growth to1.4m(2013:0.4m)as aresult of product redesignand improved supplyFull year dividend up 10%to 1.000p per share(2013:0.908p)Operating profit 27%of salesLow ge

9、aring with Debt toEBITDA ratio of 1.6 times02Our Business ModelAlliance Pharma plc|Annual Report 201403Alliance Pharma plc|Annual Report 2014Business SummaryStrategyAlliances principal activity is the marketing of pharmaceutical or healthcare products.Its brands are sourcedeither via acquisition or

10、inward licensing.They are selected for their sales stability or growth potential.Capitalintensive activities such as manufacturing,warehousing and logistics are controlled by Alliance but outsourced toleading specialist organisations in these fields.It does not engage in R&D,except for minor line ex

11、tensions.Balanced PortfolioThe bedrock of our business is established products.These are good,stable products that continue to meet medical needs andrequire limited to no promotion in order to sustain their sales.They provide considerable cash generation to support the growth activities behind the D

12、ermatology,Specialist Secondary Care,Ophthalmology and Consumer Healthcare products and also assist in the financing of acquisitions.Consumer a range of products sold over the counter.Dermatology a range of products for the treatment of eczema and skincomplaints.Bedrock non-promoted andcash generati

13、ve.International products supporting ourinternational expansion.19%17%16%35%Specialist Secondary Care used by hospitals and healthcare professionals.13%Alastair TweedaleHead of Established ProductsThe acquired products are ones whose marketposition has been established by theiroriginators.Where nece

14、ssary,Alliance ensuresthe products viability by regulatory and technicalinitiatives so that the established franchise canbe relied upon to provide sustainable cash-flowinto the foreseeable future.Acquired products are assessed for theirpotential to respond to promotional investment.If promotion woul

15、d produce an economic return,then it is implemented via Allianceshighly skilled sales and marketing operation.Corporate growth is further enhanced bylicensing in and marketing products that havebeen developed by other companies R&Dactivities.Acquisitions of products are typically financed bya combin

16、ation of cash flow,bank debt and equityin a ratio that optimises earnings per sharewhilst maintaining acceptable levels of gearing.Surplus cash generated after providing for debtservicing and the operational needs of thebusiness is then available for dividend payments.Percentages on a pro-forma basi

17、s for the year ended 31 December 2014 including share of joint ventures and acquisitions.04Alliance Pharma plc|Annual Report 2014Longevity of BrandsHydromolProductMacuShieldForcevalBuccastemNu-SealsSyntometrineTimodineVitamin ENaseptinAshton&Parsons6.0mAnnual Sales*3.5m3.5m2.5m2.5m2.1m1.7m1.6m1.4m1.

18、4m1987Launch Date200619701987197819561972198919591867Other(46 products)35.4%Hydromol12.3%Opus8.7%Forceval7.1%MacuShield7.1%Buccastem5.1%Nu-Seals4.8%Syntometrine4.4%Timodine3.5%Vitamin E3.2%Naseptin2.9%Ashton&Parsons2.8%Anti Malarials2.7%Risk Reduction Through Diversity*Proforma 2014 Revenue.AVERAGE

19、AGE 48YEARSRisk Reduction through DiversityAny potential risk is spread across a portfolio of over 60 products,the largest representing just over 10%of Alliances sales.*05Alliance Pharma plc|Annual Report 2014Business SummaryGrowth through Acquisitions19991deal20012deals20022deals20043deals20065deal

20、s20071deal20081deal20091deal20101deal20113deals20122deals20132deals20142deals20152.1m4.5m11.1m9.7m7.4m1.95m0.6m7.5m16.4m6.5m12.4m9.4m3.7m5.5m1dealTOTAL INVESTMENT SINCE 1999Alliance has a strong track record of successfulacquisitions and has considerable expertise in targetselection,contract negotia

21、tion and integration of theproducts into its operations.It has considerablefinancial resources available for future deals.Over 60products6027 dealsin 16 years27Building globaloperationTIMECA SHLOWER VOLUME typically no competition.HIGHER VOLUME generic competition.Product life-cycle:Alliances bedroc

22、k products are usually at least 10 years post patent expiry with a stable sales history and a low volume that limits direct competition.Business Development TeamAlliance is committed to continued growth viaacquisition,in-licensing opportunities and formingmutually beneficial business partnerships.Th

23、e business development team very actively searches foracquisition opportunities and will assess divestments of individualproducts,portfolios,subsidiaries and whole companies across anytherapy area or geography.Alliances experience across a wide range of pharmaceuticalproducts and markets allows for

24、rapid assessment of opportunitiesas they occur.Throughout the acquisition process,the business development teamintegrates with finance,legal,operations,regulatory and marketing.This allows for rapid assessment of opportunities as they occur andalso facilitates a smooth transition of ownership when t

25、heacquisition has completed.Left to right:Anne Melbourne,Dan Thomas,Keturah McElroy and Puja ThaparGrowth through Healthcare Professionals06Alliance Pharma plc|Annual Report 2014Steve LobbHead of HydromolDavid HopeHead of Secondary CareImmuCystImmuCyst 81mg is a Bacillus Calmette Gurin(BCG)therapy w

26、hich was originally developed as a vaccine,but waslater discovered to be effective against non-muscle invasivebladder cancer.It works the way other vaccines work,bystimulating the bodys own immune system to fight thecancer.ImmuCyst has been shown to be a more effectivetreatment than chemotherapy in

27、fighting the growth of these tumours.Opus HealthcareThe Opus Healthcare business specialises in the development and supply of a stoma careaccessory range.SkinSafe protective film and Lift Plus adhesive remover protect peristomalskin whilst AbsorbaGel,DeoGel,LaVera,ClearWay and NaturCare are designed

28、 to makewearing a stoma pouch easier.All of the products are available on prescription.GelclairGelclair is a viscous gel specially formulated to aid in themanagement of lesions of the oral mucosa.It forms aprotective film that,by coating and sticking to the lining of themouth and throat,offers rapid

29、 and effective painmanagement.Gelclair comes as a concentrated gel insachets for dilution with water.Alliances Dermatology and Secondary Care business units both utilise our UK sales force to promote productswithin their ranges to Healthcare Professionals.Specific targeting techniques are used to in

30、crease awareness ofthese products which helps drive growth in market share.07Alliance Pharma plc|Annual Report 2014Business SummaryHydromolThe Hydromol complete emollient therapy range is used to control dry skin conditions and improve skin hydration.Dermatological conditions are among the most comm

31、on diseases encountered by healthcare professionals.Atopic eczema accountsfor 30%of all dermatological consultations in general practice,and the prevalence is increasing.Estimates vary due to the differentpopulations examined,but figures suggest a prevalence of around 1520%in children and 210%in adu

32、lts.The Hydromol range comprises an ointment,a bath and shower emollient,a cream and an intensive urea cream.The brand Hydromolachieved 18%*growth in 2014.01m2m3m4m5m6m7mJan-10Apr-10Jul-10Oct-10Jan-11Apr-11Jul-11Oct-11Jan-12Apr-12Jul-12Oct-12Jan-13Apr-13Jul-13Oct-13Jan-14Apr-14Jul-14Oct-14Hydromol U

33、K sales*IMS data.MolluDabMolluDab is a clinically proven,effective treatment for theviral skin condition molluscum contagiosum.Containing 5%potassium hydroxide,MolluDab clears the molluscum lesionsin 1-5 weeks,far quicker than leaving them to clear on theirown,which can take 18 months or more.Potass

34、ium hydroxideis the only solution indicated for use on molluscumcontagiosum,which presents itself as wart type papules onthe skin,predominantly affecting children and young adults.Growth through Consumer MarketsLypsylThe original lip balm since 1891,Lypsyl provides dailymoisturising care and protect

35、ion for your lips.The Vitamin Eformula helps stop lips from drying out,with Aloe Veraextracts to soothe and moisturise and SPF15 to protect yourlips against harmful UVA and UVB rays.Lypsyls Cold SoreGel provides a triple action formula to relieve the symptomsof cold sores.AnbesolAnbesol is a well-es

36、tablished treatment used for thetemporary relief of pain caused by mouth ulcers,dentureirritation and babies teething.Anbesol contains a localanaesthetic(lidocaine hydrochloride)which works by helpingto stop the sensation of pain.It also contains two antisepticswhich help protect against infection.A

37、vailable in a liquid,adult gel and teething gel formulations.08Alliance Pharma plc|Annual Report 2014Alex DugganHead of Consumer HealthcareIn recent years we have been broadening the scope of our portfolio,primarily toinclude consumer healthcare products.These products typically require some modest

38、marketing investment but offerpotential for organic growth.Alex Duggan joined Alliance in 2014 as Head of Consumer Healthcare.Alex bringswith him a wealth of experience that is being utilised to aid the growth anddevelopment of the consumer brands.MacuShieldMacuShield,recently acquired in February 2

39、015,is the UKsmost recommended eye care supplement by opticians.MacuShield is a unique food supplement containing the threemacular pigments lutein,zeaxanthin and meso-zexanthin,and is designed to be taken by sufferers of dry age-relatedmacular degeneration(AMD)and other eye conditions.The product is

40、 supported by numerous peer-reviewedpublished studies.Business Summary09Alliance Pharma plc|Annual Report 2014Ashton&ParsonsAshton&Parsons Infants Powders are a gentle,naturalremedy for the pain and symptoms associated with teething.Originally developed in 1867 by Ashton&Parsons London,TheCity Homeo

41、pathic Pharmacies,these Infants Powders havebeen used to soothe the symptoms of teething pain for nearly150 years.Made from tincture of Matricaria,which is extractedfrom German Chamomile flowers,Ashton&Parsons is proudto be Britains No.1 Teething Remedy in Pharmacies and will bemaking its TV debut i

42、n 2015.ChinaAlliance accelerated the development of its mother andbaby franchise in 2014 and is well placed to benefit fromthe expected growth in this sector.In 2014,Alliance acquired a 20%stake in Synthasia for0.5m.Synthasia is a Shanghai based company supplyingthe Chinese market with Suprememil,an

43、 advanced infantmilk formula brand that is manufactured for it inSwitzerland.During 2014 the Chinese authoritiesperformed a review of the import licences for infant milk;Suprememils licence was renewed,whilst many were not,providing further opportunities for growth.Alliance,via its joint venture par

44、tner,continues to sell thevitamin/mineral supplement FushiFu(Forceval)for use inearly pregnancy.Growth through International Expansion10Alliance Pharma plc|Annual Report 2014Local Partners:Direct PresenceJoint VentureLocal PartnersNetherlandsDenmarkFinlandSwedenIcelandSpainPortugalCzech RepublicGree

45、cePolandRomaniaSlovakiaMaltaCyprusLebanonQatarOmanEgyptGabonNigerBurkina FasoMadagascarKenyaSouth AfricaNamibiaSwazilandMauritiusSri LankaMalaysiaBruneiSingaporeHong KongAustraliaNew ZealandThe CaribbeanTony BooleyInternational Executive DirectorCon WalsheCountry Manager of IrelandLars BrgerCountry

46、Manager of GermanyPhilippe PasdelouCountry Manager of France11Alliance Pharma plc|Annual Report 2014Business SummaryRest of the WorldIn 2014 Alliance completed the integration of the 2013acquisition for the worldwide rights to Syntometrine,havingalready owned the UK rights.This added several importa

47、ntnew distributors,via new territories including Australia,South Africa and Malaysia.These may be valuablerelationships in the event of further acquisitions.The acquisition of MacuShield will also add sales in severalnew territories,furtherincreasing Alliancesinternational presence.Rajiv GhidiyalHea

48、d of APAC,EMEA,AmericasEuropeUKAlthough we are undertaking international expansion,79%ofour total business is in the UK,which remains an importantgrowth area.We continue to screen a large volume ofacquisition opportunities in a variety of therapeutic areas within the UK market,as well as searching f

49、or organic growth potential.GermanyIn January 2014,from Bayer Alliance acquired Irenat,its firstproduct in Germany,moving to a position of profitable trading aspart of the strategy of developing international presence.Irenat is an established endocrinology brand that is mainly usedfor diagnosing and

50、 treating hyperthyroidism.Following this successful acquisition,Alliance continues topursue other opportunities.FranceIn France we continue to distribute our anti-malarial productsand are also seeing a significant number of opportunities forfurther acquisitions coming through.Republic of IrelandThe

51、acquisition of MacuShield at the beginning of 2015 will add a substantial contribution to sales in this territory and will help offset the decline in Nu-Seals due to increased generic competition.Much of the scientific research connected with MacuShield has been undertaken at the world-leading Macul

52、ar PigmentsResearch Group within the Waterford Institute of Technology.Strategic Report12Alliance Pharma plc|Annual Report 2014In 2014 Alliance performed well,taking only a modest dip in sales and profits in a challenging year,whichunderlines the resilience of our business.We enter 2015 well placed

53、for resumed growth.While sales of ourcyclical toxicology product reduced to a minimal level and Nu-Seals continued its moderate decline arising fromthe Irish governments moves on generic substitution,much of the adverse impact was offset by further solidgrowth in the rest of the portfolio.This growt

54、h will be augmented in 2015 by the acquisition of MacuShield,completed in February 2015,and the expected resumption of ImmuCyst sales in the second half of the year.Adoption of IFRS 11 JointArrangementsThe Group was required to adoptInternational Financial Reporting Standard11 Joint Arrangements in

55、2014.Alliancesjoint ventures,both of which are in China,arenow accounted for using the equity methodwhich only brings the net result into the P&L.Previously they have been accounted forusing proportional consolidation whichincorporated our share of sales and costsseparately.Prior year figures have b

56、eenrestated accordingly and all referencesherein to prior year numbers are to therestated figures.More details of the impactcan be seen in Note 33.Trading performanceExcluding joint ventures,revenue reduced by4%to 43.5m(2013:45.3m).The declinewas due to two products:sales of our cyclicaltoxicology p

57、roduct fell in line with the lowpart of its 2-year replacement cycle and theloss of the tender;and Nu-Seals salesreduced to 2.5m under pressure fromgeneric competition.Together,theseproducts accounted for a revenue reductiontotalling some 4.3m.This was substantiallyoffset by healthy revenue growth o

58、f 2.5m(11%)in the rest of our portfolio.The underlying growth was led by anotherdouble-digit performance from Hydromol,with sales up 15%.We have grown annualsales of this brand from just under 1mwhen we acquired it in 2006 to over 6m in2014.Sales of the Opus stoma care productsgrew by 10%to 4.3m.Wit

59、h supplies of Ashton&Parsons InfantsPowders now free of production constraints,sales are developing well more thantripling to 1.4m in 2014.Gelclair,ourtreatment for oral mucositis,continued togrow well,with sales up 10%to 1.3m andMolluDab,the molluscum contagiosumtreatment that we launched in 2013,m

60、adefurther good progress in this niche market.We were also pleased with the performancein 2014 of our recent acquisitions Lypsyl inDecember 2013 and Irenat in Germany inJanuary 2014.With sales of 0.8m,Irenatcontinues to show the stability that made itan attractive first product for our Germanbusines

61、s.With Lypsyl we have halted thedecline experienced under its previousowners.To increase sales we have begun tocapitalise on its still-substantial consumerrecognition and are currently researchingmarket perceptions and developing ourstrategy for investment in order to breathenew life into this well-

62、known brand.We have been unable to supply ImmuCyst,our bladder cancer treatment,sinceproduction was halted at Sanofismanufacturing plant in Canada in mid-2012.ImmuCyst had peak sales of over 4m perannum before production was suspended.Regulatory validation of the refurbishedproduction facility is ta

63、king significantlylonger than initially anticipated,and we nowexpect to resume sales in the second half of2015.Market feedback indicates continueddemand for the product,and we expect torebuild substantial sales over time ashospitals revert to ImmuCyst.Indeed we areaware that the only licensed compet

64、itor isnot currently able to supply the full marketdemand.We will do all we can to bringImmuCyst back as soon as possible.In themeantime,we are at an advanced stage inthe process to consider our claim for profits lost during the extendedmanufacturing hiatus.Generic competition continues to erode Nu-

65、Seals sales in Ireland.The Irish regulatorhas still not adjudicated on which low-doseaspirin products should be included on thelist of interchangeable medicines that wouldpermit pharmacists to dispense genericproducts against branded prescriptions.Wehave submitted a strong case to theregulator for N

66、u-Seals to be kept off this listbut if Nu-Seals is eventually included,salesare likely to fall substantially,which maywell lead to a non-cash impairment chargeagainst the 9.1m intangible asset.The planned hand-back of nine products toNovartis,which we had been distributingsince the origin of the com

67、pany in 1998,wascompleted in 2014.It had been phased overthe past two years,and the impact is low asthese products generated only 0.3m ofgross margin for us in 2014.Financial performancePre-exceptional pre-tax profit was 10.8m,down 10%from 2013.However,excludingthe cyclical toxicology product,underl

68、yingprofit from the rest of the portfolio showed ahealthy increase of 15%.Adjusted earningsper share were 3.36 pence,down from 3.82pence in 2013.Gross margin for the full year was 57.5%.This was lower than the 60.4%achieved in2013,which was flattered by the peak salesof the higher-margin toxicology

69、product,buthigher than the 56.9%achieved in 2012.Weexpect to sustain margins at about the 2014level going forward.2015WELL PLACEDFOR RESUMEDGROWTHI DOUBLE-DIGITPERFORMANCEFROM HYDROMOL WITH SALES UP 15%Report of the Directors13Alliance Pharma plc|Annual Report 2014Operating costs were well contained

70、 at13.1m(2013:13.5m).We made furthermodest savings on central overheads,butmost costs remained broadly stable.Marketing investment remained broadly flat,although we continued to shift the emphasisgently from our dermatology and secondarycare products in favour of our growing OTCconsumer portfolio.Pr

71、oduction issues have halted the sales ofPavacol-D,our cough-suppressantmedicine.We are currently looking at how tobring this brand back to market but there isa significant risk that it will not beeconomical to do so and therefore therelated 0.6m intangible asset has beenwritten off in full.Apart fro

72、m this one-offnon-cash impairment charge,the impact onprofits is not significant as sales of Pavacol-D have been very low for the past few yearsas a result of various supply issues.The reduced sales contribution from thecyclical toxicology product resulted in alower operating profit before exception

73、alitems of 11.8m(2013:13.3m).Thisrepresented 27.1%of sales(2013:29.4%)still a very healthy percentage.Our financing costs reduced for the sixthconsecutive year to 1.0m(2013:1.3m).This was as a result of the conversion of thelast of the convertible loan stock in 2013 andthe reduction in net bank debt

74、 from 25.2mat the start of the year to 21.1m at theyear-end.Year-end debt to EBITDA gearingremained flat at 1.6 times.Alliance is a highly cash generativebusiness,and 2014s free cash flow of10.3m was well ahead of the 8.2machieved in 2013.3.8m of this wasreinvested in acquisitions during the yearand

75、 2.4m was returned to shareholders viathe dividends.At the year-end,our unused bank facilityavailable to fund acquisitions stood at23.8m(2013:25.0m).This was reduced to18.3m in February 2015,following thedrawdown of 5.5m as the initial paymentfor MacuVision Europe Ltd,which broughtus the MacuShield

76、brand.Earnings per shareAdjusted basic EPS was 3.36p(2013:3.82p),and adjusted diluted EPS was 3.34p(2013:3.68p),the reduction mainly reflecting theimpact of the toxicology product dropping tothe low point of its cycle and the tenderbeing lost.Including the Pavacol-Dimpairment charge,basic EPS was 3.

77、17p(2013:3.82p).During the year the number ofshares in issue remained virtuallyunchanged at 264.1m.DividendWe are maintaining our progressive dividendpolicy,recommending a final payment of0.667 pence per ordinary share to give atotal for the year of 1.0 pence per share.This represents a 10%increase

78、on theprevious years dividend,while stillmaintaining ample earnings cover of overthree times.The final dividend will be paidon 15 July 2015 to shareholders on theregister on 19 June 2015.StrategyThe essence of our model is our long-established buy and build strategy,whichis underpinned by a well bal

79、anced portfolio.We have a healthy segment of brands inwhich we invest for growth.Conversely wealso possess many brands that are wellestablished in their market niches and will OUR FINANCINGCOSTS REDUCEDFOR THE SIXTH CONSECUTIVE YEAR IS A HIGHLY CASHGENERATIVEBUSINESSALLIANCE FREE CASHFLOW OF10.3M UP

80、 15%2015WELL PLACEDFOR RESUMEDGROWTHIS A HIGHLY CASHGENERATIVEBUSINESSALLIANCERE-INTRODUCTIONOF IMMUCYSTmaintain their sales for many years withlittle or no promotion.This balance allowsus to invest in marketing to develop growth,whilst at the same time delivering goodcash generation and profitabili

81、ty.Asexamples,we purchased Lypsyl inDecember 2013 for the turn-aroundopportunity to deliver growth;Irenat inJanuary 2014 for its stability and cashgeneration without the need for promotion;and MacuShield in February 2015 for itsstrong ongoing growth and the opportunityfor us to grow the brand furthe

82、r acrossmany territories.In recent years we have been broadeningthe growth element of our portfolio toinclude consumer healthcare products.These typically offer substantial organicgrowth,whilst only requiring modestpromotional investment.Our increasingexperience in this area indicates that certainty

83、pes of consumer product can do wellwithout major marketing expenditure.Andthese consumer products help to balancerisk across the portfolio because they arenot exposed to government price controls.Strategic Report continued14Alliance Pharma plc|Annual Report 2014In February 2015 we acquired MacuVisio

84、nEurope Ltd,a UK-based business sellingMacuShield,a treatment for dry age-relatedmacular degeneration and other eyeconditions.The initial consideration was5.5m plus the net asset value,withdeferred payments totalling up to 6.0mover the next two years dependent onMacuShields sales growth.The acquisit

85、ionshould bring an initial gross profitcontribution of about 1m a year and salesare growing rapidly,up 51%in 2014.MacuShield is a once-a-day capsule thatcontains meso-zeaxanthin,lutein andzeaxanthin three carotenoids,or pigments.These three carotenoids are naturallypresent in the eye,where together

86、they areknown as macular pigment.Macularpigment helps to protect the eye byneutralising free radicals and absorbingblue light,which can damage the retina.With age,and particularly in dry age-relatedmacular degeneration and other eyeconditions,the level of macular pigment isreduced creating the need

87、for a dietarysupplement to boost the level of pigment inthe retina.Around 75%of MacuShield sales aregenerated in the UK,with the remainderbeing sales to international distributors,mainly in Europe.We continue to seek attractive acquisitionopportunities across a wide range ofproducts and markets.Over

88、 time we wouldexpect to maintain a balance across theportfolio between prescription andconsumer products,and between promotedand non-promoted products.Recently,we have increased the proportionin our portfolio of both promoted contentand consumer brands.Following theintegration of the MacuShield bran

89、d,promoted products will have risen to about40%of sales,being equally divided betweenprescription and consumer.There is likely to be to a measured increasein marketing investment over the next fewyears,although this will not be at theexpense of profitability.In 2015 the focuswill be on the re-introd

90、uction of Immucyst;continuing the rapid growth of MacuShield;the continuing growth of Hydromol;and thecommencement of promotion behindAshton&Parsons Infants Powders.In the first half of the year we are testingboth TV advertising and direct mailcampaign options for Ashton&ParsonsInfants Powders so th

91、at we can maximisethe return on the spend that is scheduledfor later in the year.Extensive work on re-positioning the Lypsylbrand will continue through 2015,with a view to increasing the marketing investmentin 2016.We have maintained our focus on M&A.InJanuary 2014 we acquired Irenat,a well-establis

92、hed prescription brand in Germanyused in thyroid conditions.This was our firstacquisition in Germany since placing aCountry Manager there in 2012.It means that our German business is now tradingprofitably.Also in January 2014,we took a 20%minority stake in the Shanghai based,Synthasia International,

93、a company thatmarkets a high-quality Swiss infant milkformula product in China.This transactionhas a progressive arrangement wherebyAlliance can increase its share to 100%overseveral years at pre-determined multiples.Progress at Synthasia was delayed initiallyby a Chinese government review of allimp

94、orted formula milk products,which,whilst problematic in the short term,hadthe benefit of removing many competitorsfrom the market.Our businesses in France and Germany areboth progressing well and we are seeing agood flow of acquisition opportunities.TeamIn May 2014 we welcomed Andrew Smith asour new

95、 Non-Executive Chairman,followingMichael Gatenbys retirement.Andrewknows the business well,having been aNon-Executive Director since 2006.Two new Non-Executive Directors havejoined the board in the past year.David Cookjoined in April 2014,taking over the Chair ofour Audit Committee from Michael Gate

96、nby,and Nigel Clifford joined in January 2015following the retirement of Paul Ranson inDecember 2014.David is currently ChiefFinancial Officer and Chief Business Officerof Biotie Therapies Corp.and bringsextensive knowledge and experience of thepharmaceutical industry.Nigel has beenChief Executive o

97、f Procserve Holdings forthe past three years and is about to move tobecome Chief Executive of Ordnance Survey.He brings broad business experience withsignificant exposure to European andinternational markets.Our Finance Director,Richard Wright,hasindicated his intention to leave Alliance atthe end o

98、f May 2015.We are grateful toRichard for his significant contribution tothe business over the past eight years andwish him well for the future.The process torecruit a replacement is under way.To manage the growing number ofconsumer products in our portfolio,weappointed Alex Duggan in January 2015 as

99、Head of Consumer Healthcare.Alex hasover 20 years of experience as anentrepreneur in consumer healthcare andhas launched several leading products inthe UK and internationally,includingSnoreeze and Wartner.CharityWe continue to donate products regularly toInternational Health Partners,a charity thatd

100、istributes medicines to doctors in theworlds neediest areas.AMPLEFINANCINGHEADROOMIN CONSUMERHEALTHCAREWE HAVE SEVERALGROWTHINITIATIVESWE WELCOMEDANDREW SMITHAS OUR NEWNON-EXECUTIVECHAIRMANIN JANUARY 2014WE ACQUIREDIRENATWE CONTINUETO SEEKATTRACTIVEACQUISITIONOPPORTUNITIESACROSS A WIDERANGE OFPRODUC

101、TSAND MARKETSWE PURCHASEDMACUSHIELDIN FEBRUARY 2015 FOR ITS STRONGONGOINGGROWTHPROGRESSIVEDIVIDENDPOLICYFREE CASHFLOW OF10.3M OUR FINANCINGCOSTS REDUCEDFOR THE SIXTH CONSECUTIVE YEAR DOUBLE-DIGITPERFORMANCEFROM HYDROMOL WITH SALES UP 15%DOUBLE-DIGITPERFORMANCEFROM HYDROMOL WITH SALES UP 15%2015WELL

102、PLACEDFOR RESUMEDGROWTHIS A HIGHLY CASHGENERATIVEBUSINESSALLIANCERE-INTRODUCTIONOF IMMUCYSTAMPLEFINANCINGHEADROOMIN CONSUMERHEALTHCAREWE HAVE SEVERALGROWTHINITIATIVESWE WELCOMEDANDREW SMITHAS OUR NEWNON-EXECUTIVECHAIRMANIN JANUARY 2014WE ACQUIREDIRENATWE CONTINUETO SEEKATTRACTIVEACQUISITIONOPPORTUNI

103、TIESACROSS A WIDERANGE OFPRODUCTSAND MARKETSWE PURCHASEDMACUSHIELDIN FEBRUARY 2015 FOR ITS STRONGONGOINGGROWTHPROGRESSIVEDIVIDENDPOLICYFREE CASHFLOW OF10.3M OUR FINANCINGCOSTS REDUCEDFOR THE SIXTH CONSECUTIVE YEAR DOUBLE-DIGITPERFORMANCEFROM HYDROMOL WITH SALES UP 15%DOUBLE-DIGITPERFORMANCEFROM HYDR

104、OMOL WITH SALES UP 15%2015WELL PLACEDFOR RESUMEDGROWTHIS A HIGHLY CASHGENERATIVEBUSINESSALLIANCERE-INTRODUCTIONOF IMMUCYSTAMPLEFINANCINGHEADROOMIN CONSUMERHEALTHCAREWE HAVE SEVERALGROWTHINITIATIVESWE WELCOMEDANDREW SMITHAS OUR NEWNON-EXECUTIVECHAIRMANIN JANUARY 2014WE ACQUIREDIRENATWE CONTINUETO SEE

105、KATTRACTIVEACQUISITIONOPPORTUNITIESACROSS A WIDERANGE OFPRODUCTSAND MARKETSWE PURCHASEDMACUSHIELDIN FEBRUARY 2015 FOR ITS STRONGONGOINGGROWTHPROGRESSIVEDIVIDENDPOLICYFREE CASHFLOW OF10.3M OUR FINANCINGCOSTS REDUCEDFOR THE SIXTH CONSECUTIVE YEAR DOUBLE-DIGITPERFORMANCEFROM HYDROMOL WITH SALES UP 15%D

106、OUBLE-DIGITPERFORMANCEFROM HYDROMOL WITH SALES UP 15%2015WELL PLACEDFOR RESUMEDGROWTHIS A HIGHLY CASHGENERATIVEBUSINESSALLIANCERE-INTRODUCTIONOF IMMUCYSTAMPLEFINANCINGHEADROOMIN CONSUMERHEALTHCAREWE HAVE SEVERALGROWTHINITIATIVESWE WELCOMEDANDREW SMITHAS OUR NEWNON-EXECUTIVECHAIRMANIN JANUARY 2014WE

107、ACQUIREDIRENATWE CONTINUETO SEEKATTRACTIVEACQUISITIONOPPORTUNITIESACROSS A WIDERANGE OFPRODUCTSAND MARKETSWE PURCHASEDMACUSHIELDIN FEBRUARY 2015 FOR ITS STRONGONGOINGGROWTHPROGRESSIVEDIVIDENDPOLICYFREE CASHFLOW OF10.3M OUR FINANCINGCOSTS REDUCEDFOR THE SIXTH CONSECUTIVE YEAR DOUBLE-DIGITPERFORMANCEF

108、ROM HYDROMOL WITH SALES UP 15%DOUBLE-DIGITPERFORMANCEFROM HYDROMOL WITH SALES UP 15%2015WELL PLACEDFOR RESUMEDGROWTHIS A HIGHLY CASHGENERATIVEBUSINESSALLIANCERE-INTRODUCTIONOF IMMUCYSTReport of the Directors15Alliance Pharma plc|Annual Report 2014Alliance also supports its employees in theirfundrais

109、ing activities for local charities.In2014 this included 9,000 raised by eightemployees who cycled from Bristol toBordeaux in aid of PROPS,a charitysupporting young people with special needs;and 2,500 raised by employees for theWiltshire Air Ambulance.OutlookIn 2015 and 2016 we expect to overcome the

110、headwinds that have beset us in recentyears,namely:the suspension of ImmuCystproduction in 2012;the generic threats toNu-Seals in Ireland as part of the genericsubstitution initiative;and the emergence ofnew competitors to our cyclical toxicologyproduct.ImmuCyst is expected to return in thesecond ha

111、lf of 2015 after an absence ofthree years.Our market intelligence is thatclinicians eagerly await its resumedavailability.Additionally in the hospitalsector we expect continuing goodperformance from Gelclair in oralcomplications arising from cancertreatments and we expect the Opus range ofstoma prod

112、ucts to continue to sell well.The long-running positive trend behindHydromol,our favoured range of emollientsfor patients requiring skin rehydration,isalso expected to continue.In consumer healthcare,we have severalgrowth initiatives.We aim to develop furtherthe strong franchise behind Ashton&Parson

113、s Infants Powders,which is thenumber one pharmacy brand in its sector.With Lypsyl,following brand re-positioningwork being undertaken this year,we plan tore-invigorate this well-known brand in 2016.Finally we are very excited by the significantpotential afforded by MacuShield,which isrecommended by

114、eye specialists for use indry age-related macular degeneration.On the M&A front we are encouraged by thedeal flow we are currently experiencing,forwhich we have ample financing headroom.AMPLEFINANCINGHEADROOMIN CONSUMERHEALTHCAREWE HAVE SEVERALGROWTHINITIATIVESWE WELCOMEDANDREW SMITHAS OUR NEWNON-EX

115、ECUTIVECHAIRMANIN JANUARY 2014WE ACQUIREDIRENATWE CONTINUETO SEEKATTRACTIVEACQUISITIONOPPORTUNITIESACROSS A WIDERANGE OFPRODUCTSAND MARKETSWE PURCHASEDMACUSHIELDIN FEBRUARY 2015 FOR ITS STRONGONGOINGGROWTHPROGRESSIVEDIVIDENDPOLICYFREE CASHFLOW OF10.3M OUR FINANCINGCOSTS REDUCEDFOR THE SIXTH CONSECUT

116、IVE YEAR DOUBLE-DIGITPERFORMANCEFROM HYDROMOL WITH SALES UP 15%DOUBLE-DIGITPERFORMANCEFROM HYDROMOL WITH SALES UP 15%2015WELL PLACEDFOR RESUMEDGROWTHIS A HIGHLY CASHGENERATIVEBUSINESSALLIANCERE-INTRODUCTIONOF IMMUCYSTAMPLEFINANCINGHEADROOMIN CONSUMERHEALTHCAREWE HAVE SEVERALGROWTHINITIATIVESWE WELCO

117、MEDANDREW SMITHAS OUR NEWNON-EXECUTIVECHAIRMANIN JANUARY 2014WE ACQUIREDIRENATWE CONTINUETO SEEKATTRACTIVEACQUISITIONOPPORTUNITIESACROSS A WIDERANGE OFPRODUCTSAND MARKETSWE PURCHASEDMACUSHIELDIN FEBRUARY 2015 FOR ITS STRONGONGOINGGROWTHPROGRESSIVEDIVIDENDPOLICYFREE CASHFLOW OF10.3M OUR FINANCINGCOST

118、S REDUCEDFOR THE SIXTH CONSECUTIVE YEAR DOUBLE-DIGITPERFORMANCEFROM HYDROMOL WITH SALES UP 15%DOUBLE-DIGITPERFORMANCEFROM HYDROMOL WITH SALES UP 15%2015WELL PLACEDFOR RESUMEDGROWTHIS A HIGHLY CASHGENERATIVEBUSINESSALLIANCERE-INTRODUCTIONOF IMMUCYSTPrincipal risks and uncertaintiesThe Groups principa

119、l risks and uncertaintiesare outlined below.Sales volumes being affected by a change in demandChanges in demand for pharmaceuticalsproducts could be caused by a number offactors,such as changes in the competitiveenvironment.Key criteria when Allianceselects products to add to its portfolio arethat t

120、he products are in niche areas,with themajority requiring little or no promotionalsupport,and that the products have manyyears of steady sales history beforeacquisition.Sales volumes being affected by supply chain constraintsIssues within the supply chain can interruptsupply leading to insufficient

121、stock beingavailable to meet demand,particularly as allmanufacturing is outsourced and is thereforeoutside our direct control.Over the last fewyears Alliance has taken a number ofmeasures to strengthen its supply chain.These include where possible strengtheningthe supply chain team within the busine

122、ss,dual sourcing of some key products and ofsome key ingredients,holding larger bufferstocks of selected products and improvedcommunication with suppliers.Sales pricing being reduced by regulatory actionAround one third of the Groups revenues are from products covered by thePharmaceutical Price Regu

123、lation Scheme(PPRS),which is the UK Governments toolfor controlling pricing for the NHS.Allianceis a member of the ABPI and other industrybodies which are consulted by theGovernment on changes to PPRS.The latestscheme commenced in January 2014 andruns for five years.Most of the other UKrevenue is fr

124、om products that are medicaldevices,sold over the counter or are generic.The regulatory regime for medical devicesallows for inflationary price increases eachyear and over the counter and genericproducts are freely priced.In Ireland,a newgeneric substitution and reference pricingregime is in the pro

125、cess of beingimplemented which may impact Nu-Sealslater in 2015.The Company has maderepresentations to the HPRA explaining whyNu-Seals should not be included on this list.Cost price inflation affecting gross marginsIncreases in the cost of goods could erodegross margins.In a number of casesAlliance

126、has arrangements with supplierswhich either fix prices or limit priceincreases over the next few years.At theexpiry of such arrangements,prices aretested against prevailing rates in themarket.Alliance also looks forimprovements in production techniques toreduce the cost of manufacturing.System failu

127、re or cyber security breachThe Group has a range of measures in placeto monitor and mitigate this risk:networksand systems are protected by anti-virussoftware,firewalls and networksegmentation that are regularly updated;regular introduction of more up to datesoftware also provides additional in-buil

128、tsecurity;and incident management,business continuity management and ITdisaster recovery plans are in place forcritical business processes to mitigate theeffects of the business being unable tooperate in the event of a major incident.Financial risk management The Group monitors credit risk closely a

129、ndconsiders that its current policies of creditchecks meets its objectives of managingexposure to credit risk.The Groups otherfinancial risk management policies andobjectives are detailed in note 21 of thefinancial statements.On behalf of the BoardSarah RobinsonCompany Secretary24 March 2015 16Allia

130、nce Pharma plc|Annual Report 2014Board of DirectorsAndrew Smith Chairman 325Andrew joined the Board of Alliance in 2006.He has held various senior positions in thepharmaceutical industry in the UK and USA having been managing director and seniorvice-president of SmithKline Beecham Pharmaceuticals(no

131、w GSK),chief executive ofCerebrus plc until its sale and president international medical marketing services withParexel International.Andrew is a founder of Navitas BioPharma Consulting.Hegraduated in Natural Sciences from the University of Cambridge.Directors who held office at the date of this rep

132、ort are set out below.All were Directors throughout 2014 with theexception of David Cook who was appointed on 1 April 2014 and Nigel Clifford who was appointed on 26 January 2015.John Dawson Chief Executive Officer 4John founded Alliance in 1996.He gained multi-disciplinary experience in thepharmace

133、utical industry over thirty years.John held various senior roles at Sandoz(now Novartis AG)as director of finance and administration and deputy managing director.John has a BSc(Pharmacy)and an MSc(Finance)from the London Business School.Richard Wright Finance Director Richard joined the Board of All

134、iance in 2007.He is a Chartered Accountant with over 20 years of experience in financial roles across a variety of sectors.Richard readMathematics at Robinson College,Cambridge and qualified as an accountant with Ernst&Young LLP before joining Somerfield plc.More recently,he held senior finance posi

135、tions at FirstGroup plc and Parragon Publishing.Tony Booley Executive DirectorTony joined Alliance in 1998.He has had around 30 years experience in thepharmaceutical and healthcare industries,with positions at Leo Pharma,Glaxo Wellcome(now GlaxoSmithKline“GSK”)and Getinge Industrier AB.His senior ma

136、nagementexperience includes positions in the UK and internationally.Tony graduated in Physiology,has an MBA from Warwick and is a Chartered Marketer.17Alliance Pharma plc|Annual Report 2014Report of the Directors1Chairman Audit Committee 2Audit Committee member 3Chairman Nomination Committee 4Nomina

137、tion Committee member 5Chairman Remuneration Committee 6Remuneration Committee memberPeter Butterfield Executive DirectorPeter joined the board of Alliance in February 2010 following the acquisition of Cambridge Laboratories,where he spent five years,latterly as UK Commercial Director.He is a Board

138、Member of the Association of the British Pharmaceutical Industry(ABPI)and is chairman of the ABPI Small Companies Forum.Prior to joining CambridgeLaboratories,Peter spent six years at GlaxoSmithKline.He holds an honours degree inPharmacology from the University of Edinburgh.Thomas Casdagli Non-Execu

139、tive Director 64Thomas joined the board of Alliance as a non-executive director on 3 March 2009.He is apartner at MVM Life Science Partners LLP,a life science venture capital fund.He hasbeen an active investor in life sciences since joining MVM in 2002.Before joining MVM,Thomas worked at Pricewaterh

140、ouseCoopers LLP where he qualified as a CharteredAccountant.Thomas graduated in Molecular and Cellular Biochemistry from theUniversity of Oxford in 1998.David Cook Non-Executive Director 164David joined the board of Alliance as a non-executive director on 1 April 2014.He iscurrently Chief Financial

141、Officer and Chief Business Officer of Biotie Therapies Corp,a drug development company quoted in Helsinki on the NASDAQ OMX market.He haspreviously held senior financial positions with Jazz Pharmaceuticals International,EUSA Pharma Inc and Zeneus Pharma.David qualified as a chartered accountant with

142、PricewaterhouseCoopers after graduating in chemistry at the University of Oxford.Nigel Clifford Non-Executive Director 246(appointed to Committees on 24 February 2015)Nigel joined the board of Alliance as a non-executive director on 26 January 2015.He iscurrently Chief Executive of Procserve Holding

143、s Limited,though will shortly be moving tobe Chief Executive at Ordnance Survey.He is also currently a non-executive director ofAnite plc.He has previously held senior positions at Micro Focus International plc,Nokia,Symbian Software Ltd,Tertio Telecoms Limited,Cable and Wireless plc,Glasgow RoyalIn

144、firmary NHS Trust and BT plc.Nigel graduated in Geography from the University ofCambridge and has an MBA from Strathclyde University.18Alliance Pharma plc|Annual Report 2014Senior Team MembersJanice Timberlake Human Resources DirectorJanice joined Alliance in 2011 as HR Director.She is a Fellow of t

145、he Chartered Institute ofPersonnel&Development and has over 20 years of experience in HR roles across a variety ofindustry sectors.Janices early career was in the UK mining industry,followed by Board rolesin the UK division of MyTravel Plc(formerly Airtours)and latterly the Natural EnvironmentResear

146、ch Council.She is currently a non-executive Director and Trustee of Plymouth MarineLaboratory Ltd,and holds a BSc honours degree in Geography from Hull University.Dan Thomas Business Development DirectorSince joining Alliance in 2006 Dan has led Alliances M&A and licensing activity,completing over 1

147、7 deals.Dan has worked in senior management in the clinical research(CRO)sector,at Chiltern International and in the biotech research and diagnostics sector,at R&D Systems Europe(Techne Corp Inc),responsible for international regional salesoperations.Dan has worked in Canada,Germany and France.He ho

148、lds a first classhonours degree in Applied Biochemistry from Brunel University.In 2011 Dan won thePLG/AstraZeneca BD Executive of the Year award.Sarah Robinson Company SecretarySarah joined Alliance in 2010 as the Company Secretary.She has worked in Asia,the UKand the USA,was Company Secretary for t

149、he Financial Times and has further experiencein the financial services and health sector.A Chartered Secretary,Sarah gained her MBAfrom Southampton University.Margaret Boulton Medical&Regulatory Affairs DirectorMargaret joined Alliance in 2009.She has around twenty years of experience in thepharmace

150、utical and healthcare industries,with Regulatory/Scientific Affairs positions atAbbott,Baxter and lan.Margaret graduated in Animal Science at Nottingham,has a PhDfrom Edinburgh and an MBA from Bath.Stephen Kidner Operations DirectorStephen joined Alliance in August 2013 bringing a background in deve

151、lopment,manufacturing and supply chain management gained in the pharmaceutical industry overa 23 year career with Wyeth and Mundipharma International.A science graduate,Stephenholds an MSc in Pharmaceuticals and an MBA.19Alliance Pharma plc|Annual Report 2014Report of the DirectorsCorporate Governan

152、ceIntroductionAlliance Pharma plc is an AIM listed company and the Board is committed to achieving good standards ofcorporate governance,integrity and business ethics.Responsibilities of the BoardThe Board is responsible to the shareholders for:l Setting the Groups strategyl Maintaining the policy a

153、nd decision-making process around which the strategy is implementedl Ensuring that necessary financial andhuman resources are in place to meetstrategic aimsl Monitoring performance against keyfinancial and non-financial indicatorsl Providing leadership whilst maintaining the controls for managing ri

154、skl Overseeing the system of riskmanagementl Setting values and standards in corporate governance matters.There is a list of matters reserved for theBoard which may be updated by the Board and approved by the Board only.The Chairman is responsible for leading theBoard,facilitating the effective cont

155、ribution ofall members and ensuring that it operateseffectively in the interests of theshareholders.The Chief Executive Officer isresponsible for the leadership of the businessand implementation of the strategy.TheCompany Secretary is responsible,on behalfof the Chairman,for ensuring that all Boarda

156、nd Committee meetings are conductedproperly,that the Directors receive theappropriate information prior to the meeting,for ensuring that governance requirementsare considered and implemented and foraccurately recording each meeting.TheDirectors may have access to independentprofessional advice,where

157、 needed,at theGroups expense.Board Evaluation and Governance ReviewIn 2014 the Board conducted a BoardEvaluation and a review of corporategovernance.The review of corporate governance looked atthe new UK Governance Code(2014),andcompared its requirements with both theNAPF Aim Guidelines and the QCA

158、Code asthey apply to the Company.As the company islisted on AIM,it is not required to comply withthe UK Governance Code but uses this as abenchmark for good governance practice.The review noted that the appointment ofDavid Cook in April 2014 and the anticipatedappointment of Nigel Clifford in Januar

159、y 2015would build on the independence of the Board.The Board did not consider that theappointment of senior independent directorwas necessary in 2014 but will consider this at each review.The Board Evaluation,conducted every twoyears,reviewed the effectiveness of theBoard in determining the corporat

160、e strategy,governance and controls,and Boarddevelopment.The Evaluation results will beused to develop the effectiveness of theBoard when progressing the corporatestrategy and oversight of the controlstructure within the organisation.TheEvaluation considered the Boardsdevelopment requirements and the

161、appropriate induction of new members.Relations with ShareholdersAt each meeting,the Board is updated on themeetings and communications with theshareholders and an analysis of theshareholder base is presented.Research notes by brokers are circulated to all Boardmembers.Throughout the year the ChiefEx

162、ecutive Officer and Finance Director meetwith the large,institutional shareholderswho hold the majority of the shares.Regularfeedback is given to the Board followingmeetings with the shareholders from thefinancial PR advisors,and from theshareholders via the brokers.The Group recognises that whilst

163、themajority of the shares are held by largeinstitutions,attention should be paid to theprivate shareholders and the InvestorRelations section of the Groups website isregularly updated and amended with the aimbeing to provide good information to allshareholders,particularly private investors.The webs

164、ite provides a facility to receiveemail alert notifications of Group news andstock exchange announcements.In additionthe Chief Executive Officer and FinanceDirector regularly present at conferencesattended by many potential and currentprivate shareholders and meet with PrivateClient Fund Managers re

165、presenting theinterests of private investors following whichfeedback is given to the Group.At the Annual General Meeting the Chairmanissues a statement on current trading.Directors are available following the meeting to answer questions and for informaldiscussions.The results of the proxy votesare a

166、nnounced at the meeting,including theabstentions and these are published on thewebsite following the meeting.Management TeamsDuring 2014 the Board delegated managementof the business to the Corporate OrganisationTeam and the UK and International Review and Planning Teams.The Executive Team,which com

167、prises the Executive Directors,is the chief operating decision maker and attended the Corporate Organisation Team and Review and Planning team meetings.Reporting StructureCommitteesThe Board has an Audit Committee,aNominations Committee and a RemunerationCommittee,each with written terms ofreference

168、.The terms of reference are availableon the Group website.The Report of theRemuneration Committee and Report of theNominations Committee form part of thisgovernance section.Each Committee reports to the Board on its activities.MeetingsThe Board meets regularly on pre-determineddates and has a strate

169、gy meeting each yearconsisting of the Board and other SeniorManagers,the purpose of which is to discussprogress on the strategy,to review the long termstrategy and develop the strategic framework forthe achievement of the Groups targets.During2014 the Board held 11 scheduled meetings.Michael Gatenby

170、 attended the three scheduledmeetings until his retirement in March 2014.David Cook attended the eight scheduled Boardmeetings from his appointment in April 2014.Thomas Casadagli attended ten Board meetings.All other members of the Board attended all thescheduled meetings.In addition there were anum

171、ber of ad-hoc meetings.Non-Executive DirectorsThe role of the non-executive directors is to:l Challenge constructively and help developproposals on strategyl Satisfy themselves as to the financial integrity of the financial informationl Satisfy themselves as to the robustness of the controlsl Ensure

172、 that the systems of risk management are robust and defensiblel Review management performance and themonitoring and reporting of suchperformance.They have a role in determining the pay andbenefits of the Executive Directors,to play a key role in the appointment and,if necessary,removal of Executive

173、Directors and Boardsuccession.Directors RemunerationDirectors RemunerationThe aggregate remuneration payable to the directors during the period was as follows:Salary Bonus Other Pension Total Remuneration 2014 2013 2014 2013 2014 2013 2014 2013 2014 2013A R Booley 182,057 153,001 7,789 35,908 6,483

174、2,114 2,403 17,792 198,732 208,815P J Butterfield 161,600 153,001 10,219 45,063 520 473 15,140 14,280 187,479 212,817T Casdagli -J Dawson 212,677 209,076 8,014 49,904 5,332 6,086 10,000 10,000 236,023 275,066M R B Gatenby 29,277 74,246 -832 770 -30,109 75,016P M Ranson 34,404 33,791 -34,404 33,791A

175、L Smith 56,134 33,791 -1,611 499 -57,745 34,29R D Wright 155,606 153,001 5,720 36,050 1,767 1,610 14,372 14,280 177,465 204,941D Cook 25,910 -318 -26,228 -857,665 809,907 31,742 166,925 16,863 11,552 41,915 56,352 948,185 1,044,736Remuneration CommitteeThe members of the RemunerationCommittee are:An

176、drew Smith(Chairman of theRemuneration Committee)Thomas Casdagli David CookNigel Clifford(appointed 24 February 2015)The Company Secretary attends themeetings of the Remuneration Committeeas secretary to the RemunerationCommittee.The Chief Executive Officer andthe Human Resources Director are alsoin

177、vited to attend certain meetings of theRemuneration Committee.There were 6 Remuneration Committeemeetings held during the year.The Large and Medium-sized Companiesand Groups(Accounts and Reports)(Amendment)Regulations 2013 do notapply to companies quoted on AIM;theRemuneration Committee is committed

178、 touse the Regulations to influence the Reportand follow best practice where appropriate.The terms of reference of theRemuneration Committee are available onwww.alliancepharma.co.uk Total Remuneration Share based payments Total 2014 2013 2014 2013 2014 2013A R Booley 198,732 208,815 35,013 20,227 23

179、3,745 229,042P J Butterfield 187,479 212,817 55,092 80,077 242,571 292,894T Casdagli -J Dawson 236,023 275,066 -236,023 275,066M R B Gatenby 30,109 75,016 -30,109 75,016P M Ranson 34,404 33,791 -34,404 33,791A L Smith 57,745 34,290 -57,745 34,290R D Wright 177,465 204,941 35,013 20,258 212,478 225,1

180、99D Cook 26,228 -26,228 -948,185 1,044,736 125,118 120,562 1,073,303 1,165,298Role of the RemunerationCommitteeThe Remuneration Committee reviews anddetermines on behalf of the Board andshareholders of the Company the pay,benefits and other terms of service of theExecutive Directors of the Company a

181、nd thebroad pay strategy with respect to seniorCompany employees.Remuneration PolicyThe objective of the Companys remunerationpolicy is to attract and retain the directorsand senior executives needed to run theCompany in a cost-effective manner.The remuneration policy of the Companyhas four principa

182、l components:1.Basic Salaries and Benefits in Kind Basic salaries are determined by theRemuneration Committee bearing in mind the salaries paid in AIM-listed andother small market capitalisationhealthcare companies.Within that frame of reference,it is intended that payshould be at or near the median

183、 level.Benefits in kind include the provision ofcompany cars(or a salary alternative).2.Bonuses Bonuses are payable to staffaccording to the achievement by theGroup of certain pre-determined earningstargets.The level of bonuses payable onachievement of the targets is set at thelevel perceived approp

184、riate to providethe necessary incentives for ExecutiveDirectors and Senior Managers.Thereare appropriate adjustments to thebonus payable in the event of over-orunder-achievement of the Group againstthose targets.In addition,bonuses areadjusted for personal performance andthe amount of bonus paid wil

185、l reflectany substantial periods of absence orunavailability of the employee.3.Share Options Scheme The Companyhas in place a share option schemecovering all employees,under whichshare options are normally grantedonce a year.The exercise price of theoptions granted under the scheme is setequal to th

186、e market value of thecompanys shares at the time of grant.The share option scheme is overseen bythe Remuneration Committee whichshall determine the terms under whicheligible individuals may be invited toparticipate.The scheme is normally anHMRC approved scheme but may beunapproved in relation to cer

187、tainindividuals.4.Pensions There is a definedcontribution scheme for all ExecutiveDirectors and employees.Only basicsalaries are pensionable,except in thecase of Tony Booley,whose bonus isalso pensionable.20Alliance Pharma plc|Annual Report 2014Report of the DirectorsDirectors Service ContractsAll E

188、xecutive Directors are employed under service contracts.The services of all Executive Directors may be terminated by the provisionof a maximum of 12 months notice by the Company.Directors Share OptionsDetails of options for the directors who served during the year are as follows:Number 2013 Granted

189、Exercised Number 2014 Not subject to Subject to Not subject to Subject to Not subject to Subject to Not subject to Subject to Exercise Date from performance performance performance performance performance performance performance performance price which Expiry conditions conditions conditions conditi

190、ons conditions conditions conditions conditions (pence)exercisable dateAR Booley 110,000 -110,000 -7.75 13/04/12 12/04/19 116,500 -116,500 -34.25 29/04/13 28/04/20 130,000 -130,000 -34.12 28/04/14 27/04/21 140,000 -140,000 -29.25 19/10/15 18/10/22 144,200 -144,200 -37.25 06/06/16 05/06/23 -400,000 -

191、400,000 35.75 23/10/18 22/10/23 -144,200 -144,200 33.75 11/04/17 10/04/24PJ Butterfield 1,000,000 -1,000,000 -33.25 26/03/13 25/03/20 115,000 -115,000 -34.25 29/04/13 28/04/20 1,130,000 -1,130,000 -34.12 28/04/14 27/04/21 140,000 -140,000 -29.25 19/10/15 18/10/22 144,200 -144,200 -37.25 06/06/16 05/

192、06/23 -400,000 -400,000 35.75 23/10/18 22/10/23 -144,200 -144,200 33.75 11/04/17 10/04/24RD Wright -8.50 23/04/11 22/04/18 -7.75 13/04/12 12/04/19 118,650 -118,650 -34.25 29/04/13 28/04/20 130,000 -130,000 -34.12 28/04/14 27/04/21 140,000 -140,000 -29.25 19/10/15 18/10/22 144,200 -144,200 -37.25 06/

193、06/16 05/06/23 -400,000 -400,000 35.75 23/10/18 22/10/23 -144,200 -144,200 33.75 11/04/17 10/04/24The market price of ordinary shares at 31 December 2014 was 37.00 pence and the range during the period was from 32.00 pence to41.00 pence.Nominations CommitteeThe Nominations Committee met seventimes d

194、uring the year.Michael Gatenbyattended the 3 meetings prior to hisretirement on 26 June 2014.David Cookattended the 4 meetings following hisappointment.Thomas Casdagli attended 6meetings.Other members attended all themeetings.The Committee focused heavilyon Board succession with the following keyout

195、comes:l The appointment on 1 April 2014 ofDavid Cook as a Non-Executive Directorand as Chair of the Audit Committeel The appointment of Nigel Clifford on 26January 2015 as a Non-ExecutiveDirectorThe Committee appointed Hanson GreenLtd to compile a short list of candidates forthese vacancies.Hanson G

196、reen Ltd has noother connection with the company.TheCommittee acknowledges that diversity is abenefit to the Company and bears this inmind when recruiting to any role.By thisapproach,the company seeks to recruit thebest individual for the role,but has notimplemented a policy of positivediscriminatio

197、n by forms of measurablediversity objectives.Board succession and composition willremain a priority for the coming year.Audit CommitteeThe Audit Committee met 3 times duringthe year.Michael Gatenby attended the 1meeting prior to his retirement on 26 June2014.David Cook attended the 2 meetingsfollowi

198、ng his appointment.Andrew Smithand Paul Ranson,prior to his retirement on31 December 2014,attended all meetings.The external auditors attend the meetingsto discuss the planning and conclusions oftheir audits and reviews.The Audit Committee is able to call forinformation from management andconsults w

199、ith the external auditors directlyif required.The Audit Committee operates withinspecific terms of reference which include:l considering the appointment of externalauditorsl reviewing the relationship with externalauditorsl reviewing the financial reporting andinternal control proceduresl reviewing

200、the management of financialmatters and focusing upon theindependence and objectivity of theexternal auditorsl reviewing the consistency of accountingpolicies both on a year to year basis andacross the Group.21Alliance Pharma plc|Annual Report 201422Alliance Pharma plc|Annual Report 2014Other Matters

201、Principal activitiesThe principal activity of the Group is the acquisition,marketing and distribution of pharmaceutical products.The principal activity of theCompany is to act as a holding company.DirectorsThe following table shows the beneficial interests of the Directors(and their spouses and mino

202、r children)in the shares of the Company.Ordinary shares At start of year Beneficial Non-beneficial or subsequent interest interest At end of year appointment Number Number Number NumberAnthony Booley 4,310,723 -4,310,723 4,610,723Peter Butterfield -Thomas Casdagli 26,101 24,035,799 24,061,900 24,061

203、,900John Dawson 39,576,402 20,000,000 59,576,402 59,576,402Michael Gatenby 350,000 -350,000 350,000Paul Ranson 48,000 -48,000 48,000Andrew Smith 200,000 -200,000 200,000Richard Wright 190,768 -190,768 190,768Directors Responsibilities StatementThe directors are responsible for preparing the Strategi

204、c Report and the Directors Report and the financial statements in accordancewith applicable law and regulations.Company law requires the directors to prepare financial statements for each financial year.Under that law the directors have elected toprepare the Group financial statements and the Compan

205、y financial statements in accordance with International Financial ReportingStandards as adopted by the European Union(IFRSs).Under company law the directors must not approve the financial statements unlessthey are satisfied that they give a true and fair view of the state of affairs and profit or lo

206、ss of the company and group for that period.Inpreparing these financial statements,the directors are required to:l select suitable accounting policies and then apply them consistently;l make judgments and accounting estimates that are reasonable and prudent;l state whether applicable IFRSs have been

207、 followed,subject to any material departures disclosed and explained in the financialstatements;l 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 adequate accounting

208、 records that are sufficient to show and explain the companys transactionsand disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financialstatements comply with the Companies Act 2006.They are also responsible for safeguarding the a

209、ssets of the company and hence fortaking reasonable steps for the prevention and detection of fraud and other irregularities.The Directors confirm that:l so far as each of the directors is aware there is no relevant audit information of which the companys auditor is unaware;andl the directors have t

210、aken all steps that they ought to have taken to make themselves aware of any relevant audit information and toestablish that the auditors are aware of that information.The directors are responsible for the maintenance and integrity of the corporate and financial information included on the companysw

211、ebsite.Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ fromlegislation in other jurisdictions.23Alliance Pharma plc|Annual Report 2014Report of the DirectorsDisabled employeesApplications for employment by disabled persons are fully co

212、nsidered,bearing in mind the aptitudes of the applicant concerned.In theevent of members of staff becoming disabled,every effort is made to ensure that their employment with the Group continues and thatappropriate training is arranged.It is the policy of the Group that the training,career developmen

213、t and promotion of disabled personsshould,as far as possible,be identical to that of other employees.Employee information and consultationThe Group continues to involve its staff in the future development of the business.Information is provided to employees through the Group website,intranet site an

214、d by regular briefing meetings.The Group operates a Group Personal Pension Plan and a Stakeholder Pension Plan which is available to all employees.Going concernAs explained in the Strategic Report,the current rate of cash generation by the Group comfortably exceeds the capital and debt servicing nee

215、ds of the business(though there cannot,of course,be absolute certainty that the rate of cash generation will bemaintained).The Board remains confident that all the bank covenants will continue to be met.The Group has a 5m Working CapitalFacility which is largely undrawn and which the Board believes

216、should comfortably satisfy the Groups working capital needs for at leastthe next 12 months.After making enquiries,the Directors have formed a judgement that there is reasonable expectation that the Group has adequateresources to continue in operational existence for the foreseeable future.For this r

217、eason,the Directors continue to adopt the goingconcern basis in preparing the financial statements.Political donationsThere were no political donations made during the period.AuditorA resolution to re-appoint Grant Thornton UK LLP as auditor for the next year will be proposed at the annual general m

218、eeting inaccordance with section 489 of the Companies Act 2006.Annual General MeetingThe 2015 Annual General Meeting of the Company will be held on 27 May 2015,the business of which is set out in the Notice of Meeting.On behalf of the BoardSarah RobinsonCompany Secretary24 March 2015 Independent Aud

219、itors Report to the members of Alliance Pharma plcWe have audited the financial statements ofAlliance Pharma plc for theyear ended31 December 2014 which comprise the consolidatedincome statement,the consolidated statement of comprehensive income,the consolidated balance sheet,the company balance she

220、et,the consolidated statement of changes in equity,company statement of changes in equity,the consolidated and company cash flowstatements and the related notes.The financial reporting framework that has been applied intheir preparation is applicable lawandInternational Financial Reporting Standards

221、(IFRSs)as adopted by the European Union.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.Ouraudit work has been undertaken so that we might state to thecompanys members those matters we are required to state to them in ana

222、uditors report and for no other purpose.To the fullest extent permitted by law,we do not accept or assume responsibility to anyoneother than thecompany 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 an

223、d auditorAs explained more fully in the Directors Responsibilities Statement,the directors are responsible for the preparation of the financialstatements and for being satisfied that they give a true and fair view.Our responsibility is to audit and express an opinion on the financialstatements in ac

224、cordance with applicable law and International Standards on Auditing(UK and Ireland).Those standards require us tocomply with the Auditing Practices Boards Ethical Standards for Auditors.Scope of the audit of the financial statementsA description of the scope of an audit of financial statements is p

225、rovided on the Financial Reporting Councils website atwww.frc.org.uk/auditscopeukprivate.Opinion on financial statementsIn our opinion:l the financial statements give a true and fair view of the state of the groups and of the parent companys affairs as at 31 December2014 and of the groups profit for

226、 the year then ended;l the group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union;l the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.Opinion on other matter prescribed by the Companies

227、Act 2006In our opinion the information given in the Strategic Report and Directors Report for the financial year for which the financial statementsare prepared is consistent with the financial statements.Matters on which we are required to report by exceptionWe have nothing to report in respect of t

228、he following matters where the Companies Act 2006 requires us to report to you if,in our opinion:l adequate accounting records have not been kept by the parent company,or returns adequate for our audit have not been receivedfrom branches not visited by us;orl the parent company financial statements

229、are not in agreement with the accounting records and returns;orl certain disclosures of directors remuneration specified by law are not made;orl we have not received all the information and explanations we require for our audit.Tracey JamesSenior Statutory Auditorfor and on behalf of Grant Thornton

230、UK LLPStatutory Auditor,Chartered AccountantsOxford Rowan Place24 March 201524Alliance Pharma plc|Annual Report 2014Financial StatementsConsolidated Income Statement25Alliance Pharma plc|Annual Report 2014 Year ended Year ended 31 December 31 December 2014 2013 Restated*Notes 000s 000sRevenue 3 43,5

231、36 45,275Cost of sales (18,493)(17,944)Gross profit 25,043 27,331Operating expenses Administration and marketing expense (12,510)(12,917)Amortisation of intangible assets (488)(422)Share-based employee remuneration 6 (571)(632)Share of joint venture profits/(losses)319 (48)(13,250)(14,019)Operating

232、profit excluding exceptional item 11,793 13,312Exceptional item:impairment 11 (622)-Operating profit 11,171 13,312Finance costs Interest payable and similar charges 5 (1,090)(1,281)Interest income 5 48 50Other finance income/(charges)5 28 (72)(1,014)(1,303)Profit on ordinary activities before taxati

233、on 4 10,157 12,009Taxation 7 (1,772)(2,425)Profit for the year attributable to equity shareholders 8,385 9,584Earnings per share Basic(pence)9 3.17 3.82Diluted(pence)9 3.16 3.68*Restated due to the adoption of IFRS 11,please see note 2 and 33.All of the activities of the Group are classed as continu

234、ing.The accompanying accounting policies and notes form an integral part of these financial statements.Consolidated Statement ofComprehensive Income Year ending Year ending 31 December 31 December 2014 2013 000s 000sProfit for the period 8,385 9,584Other comprehensive incomeOther items recognised di

235、rectly in equityItems that may be reclassified to profit or loss Interest rate swaps cash flow hedge (572)443Deferred tax on interest rate swaps 119 (93)Foreign exchange translation differences 7 -Share of joint venture other comprehensive loss (8)-Total comprehensive income for the period 7,931 9,9

236、3426Alliance Pharma plc|Annual Report 2014Financial StatementsConsolidated Balance Sheet27Alliance Pharma plc|Annual Report 2014 31 December 31 December 1 January 2014 2013 2013 Restated*Restated*Note 000s 000s 000sAssets Non-current assets Intangible assets 10 88,875 87,111 77,940Property,plant and

237、 equipment 11 396 592 564Joint venture investment 33 1,271 533 1,001Joint venture receivable 33 1,462 1,462 1,462Derivative financial instruments 22 -443 -Deferred tax asset 23 194 -92,198 90,141 80,967Current assets Inventories 13 5,914 5,468 5,393Trade and other receivables 14 8,322 10,641 9,507Ca

238、sh and cash equivalents 15 1,434 687 4,613 15,670 16,796 19,513Total assets 107,868 106,937 100,480Equity Ordinary share capital 25 2,641 2,641 2,430Share premium account 29,388 29,380 25,297Share option reserve 1,995 1,424 792Reverse takeover reserve (329)(329)(329)Other reserve (103)350 -Retained

239、earnings 37,188 31,202 23,658Total equity 70,780 64,668 51,848Liabilities Non-current liabilities Long term financial liabilities 18 19,235 20,881 20,225Other liabilities 20 -20Deferred tax liability 23 6,309 6,294 6,124Provisions for other liabilities 24 -199 364Derivative financial instruments 22

240、129 -25,673 27,374 26,733Current liabilities Cash and cash equivalents 15 414 2,125 1Financial liabilities 18 2,895 2,895 6,250Convertible debt 18,19 -4,189Corporation tax 959 1,154 1,322Trade and other payables 17 6,920 8,531 9,940Provisions for other liabilities 24 227 190 197 11,415 14,895 21,899

241、Total liabilities 37,088 42,269 48,632Total equity and liabilities 107,868 106,937 100,480*Restated due to the adoption of IFRS 11,please see note 2 and 33.The financial statements were approved by the Board of Directors on 24 March 2015.John Dawson Richard WrightDirector DirectorThe accompanying ac

242、counting policies and notes form an integral part of these financial statements.Company number 04241478Company Balance Sheet 31 December 31 December 1 January 2014 2013 2013 Note 000s 000s 000sAssets Non-current assets Investment in subsidiaries 12 51,936 47,119 37,618 51,936 47,119 37,618Current as

243、sets Trade and other receivables 14 25 50 10,021 Cash and cash equivalents 15 12 12 182 37 62 10,203Total assets 51,973 47,181 47,821Equity Ordinary share capital 25 2,641 2,641 2,430 Share premium account 29,388 29,380 25,297 Share option reserve 1,995 1,424 792 Retained earnings 17,766 13,527 14,7

244、19 Total equity 51,790 46,972 43,238Liabilities Current liabilities Convertible debt 18,19 -4,189 Corporation tax -4Trade and other payables 17 183 209 390 183 209 4,583Total liabilities 183 209 4,583Total equity and liabilities 51,973 47,181 47,821The financial statements were approved by the Board

245、 of Directors on 24 March 2015.John Dawson Richard WrightDirector DirectorThe accompanying accounting policies and notes form an integral part of these financial statements.Company number 0424147828Alliance Pharma plc|Annual Report 2014Financial StatementsConsolidated Statement of Changes in Equity

246、Ordinary Share Share Reverse share premium option takeover Other Retained Total capital account reserve reserve reserve earnings equity 000s 000s 000s 000s 000s 000s 000sBalance 1 January 2013 2,430 25,297 792 (329)-23,658 51,848Issue of shares 211 4,083 -4,294Dividend paid -(2,040)(2,040)Share opti

247、ons charge -632 -632Transactions with owners 211 4,083 632 -(2,040)2,886Profit for the period -9,584 9,584Other comprehensive income Interest rate swaps cash flow hedge -443 -443Deferred tax on interest rate swap -(93)-(93)Total comprehensive income for the period -350 9,584 9,934Balance 31 December

248、 2013 2,641 29,380 1,424 (329)350 31,202 64,668Balance 1 January 2014 2,641 29,380 1,424 (329)350 31,202 64,668Issue of shares -8 -8Dividend paid -(2,398)(2,398)Share options charge -571 -571Transactions with owners -8 571 -(2,398)(1,819)Profit for the period -8,385 8,385Other comprehensive income I

249、nterest rate swaps cash flow hedge -(572)-(572)Deferred tax on interest rate swap -119 -119Foreign exchange translation differences -(1)(1)Total comprehensive income for the period -(453)8,384 7,931Balance 31 December 2014 2,641 29,388 1,995 (329)(103)37,188 70,780The balance on the share premium ac

250、count may not be legally distributed under section 831 of the Companies Act 2006.29Alliance Pharma plc|Annual Report 2014Company Statement of Changes in Equity Ordinary Share Share share premium option Retained Total capital account reserve earnings equity 000s 000s 000s 000s 000sBalance 1 January 2

251、013 2,430 25,297 792 14,719 43,238 Issue of shares 211 4,083 -4,294Dividend paid -(2,040)(2,040)Share options charge -632 -632Transactions with owners 211 4,083 632 (2,040)2,886Profit for the period -848 848Balance 31 December 2013 2,641 29,380 1,424 13,527 46,972Balance 1 January 2014 2,641 29,380

252、1,424 13,527 46,972Issue of shares -8 -8Dividend paid -(2,398)(2,398)Share options charge -571 -571Transactions with owners -8 571 (2,398)(1,819)Profit for the period -6,637 6,637Balance 31 December 2014 2,641 29,388 1,995 17,766 51,790The balance on the share premium account may not be legally dist

253、ributed under section 831 of the Companies Act 2006.The profit for the year dealt with in the financial statements of the parent company was 6,637,000(2013:Profit 848,000).As permitted by section 408 of the Companies Act 2006,no separate income statement is presented in respect of the parent company

254、.30Alliance Pharma plc|Annual Report 2014Financial StatementsConsolidated and Company Cash Flow Statements Group Company Year ended Year ended 31 December Year ended Year ended 31 December 2013 31 December 31 December 2014 Restated*2014 2013 Note 000s 000s 000s 000sCash flows from operating activiti

255、es Cash generated from operations 27 13,451 11,897 50 (23)Tax paid (2,028)(2,516)-(4)Cash flows received from/(used in)operating activities 11,423 9,381 50 (27)Investing activities Interest received 48 50 1,757 1,464Dividend received 72 420 5,400 10,000Investment in subsidiary -(4,817)(9,501)Payment

256、 of deferred consideration -(20)-Development costs capitalised 10 (58)(63)-Purchase of property,plant and equipment 11 (111)(298)-Purchase of other intangible assets 10 (2,817)(9,534)-Investment in joint venture 33 (499)-Net cash(used in)/received from investing activities (3,365)(9,445)2,340 1,963F

257、inancing activities Interest paid and similar charges (986)(1,232)-(148)Loan issue costs -(500)-Loan to joint venture (503)-Proceeds from exercise of share options 8 82 8 82Dividend paid (2,398)(2,040)(2,398)(2,040)Receipt from borrowings 2,750 28,500 -Repayment of borrowings (4,500)(30,725)-Net cas

258、h(used in)/received from financing activities (5,629)(5,915)(2,390)(2,106)Net movement in cash and cash equivalents 2,429 (5,979)-(170)Cash and cash equivalents at the beginning of the period (1,438)4,613 12 182Exchange gains/(losses)on cash and cash equivalents 29 (72)-Cash and cash equivalents at

259、the end of the period 15 1,020 (1,438)12 12*Restated due to the adoption of IFRS 11,please see note 2 and 33.The accompanying accounting policies and notes form an integral part of these financial statements.31Alliance Pharma plc|Annual Report 2014Notes to the Financial Statements1.General informati

260、onAlliance Pharma plc(the Company)and its subsidiaries(together the Group)acquire,market and distribute pharmaceutical and othermedical products.The Company is a public limited company incorporated and domiciled in England.The address of its registered office isAvonbridge House,Bath Road,Chippenham,

261、Wiltshire,SN15 2BB.The Company is listed on the AIM stock exchange.These consolidated financial statements have been approved for issue by the Board of Directors on 24 March 2015.2.Summary of significant accounting policiesThe principal accounting policies applied in the preparation of these consoli

262、dated financial statements are set out below.The newconsolidation standards have been adopted in the year(IAS 27,28 and IFRS 10,11 and 12),none have a material impact other than thatnoted through IFRS 11.These policies have been consistently applied to all the periods presented,unless otherwise stat

263、ed.2.1 Basis of preparationThese financial statements have been prepared in accordance with International Financial Reporting Standards as adopted by the EU andwith those parts of the Companies Act 2006 applicable to companies reporting under IFRS.The financial statements have been preparedunder the

264、 historical cost convention,with the exception of derivatives which are included at fair value.A summary of the more importantGroup and Company accounting policies are set out below.The preparation of financial statements in conformity with generally acceptedaccounting principles requires the use of

265、 estimates and assumptions in these statements,particularly in relation to determining theuseful economic life of assets,that affect the reported amounts of assets and liabilities at the date of the financial statements and thereported amounts of revenues and expenses during the reporting period.Alt

266、hough these estimates are based on managements bestknowledge of the amount,event or actions,actual results ultimately may differ from those estimates.2.2 ConsolidationThe consolidated balance sheet includes the assets and liabilities of the company and its subsidiaries which are made up to 31 Decemb

267、er2014.Entities over which the Group has the ability to exercise control are accounted for as subsidiaries.Interests acquired in entities areconsolidated from the effective date of acquisition and interests sold are consolidated up to the date of disposal.Balances between Groupcompanies are eliminat

268、ed;no profit is taken on sales between Group companies.Goodwill arising on the acquisition of interests insubsidiaries,representing the excess of consideration transferred over the Groups share of the fair values of identifiable assets,liabilities and contingent liabilities acquired,is capitalised a

269、s a separate item.An entity is treated as a joint venture where the Group holds a long term interest and shares control under a contractual agreement.Following IFRS 11 becoming effective and the subsequent adoption by the company in January 2014,the company now accounts for itsinvestment in joint ve

270、ntures using the equity method in accordance with IAS 28.This replaces the proportionate consolidation method ofaccounting applied previously,and has also required the restatement of comparative numbers.See note 33 for details of joint ventures.The consolidated income statement includes the Groups s

271、hare of the joint ventures profit.2.3 Judgements and estimatesThe preparation of the consolidated financial statements requires management to make judgements,estimates and assumptions thataffect the application of policies and reported amounts of assets and liabilities,income and expenses.The estima

272、tes and associatedassumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances.Actual results may differ from these estimates.The estimates and underlying assumptions are reviewed on an on-going basis.Revisions to accounting esti

273、mates are recognised inaccordance with IAS 8 Accounting Policies,Changes in Accounting Estimates and Errors.Critical judgements,estimates andassumptions that are applied in the preparation of the consolidated financial statements include:Depreciation and amortisationThe Group exercises judgement to

274、determine useful lives and residual values of intangibles,computer equipment,and fixtures,fittingsand equipment.The assets are depreciated down to their residual values over their estimated useful lives.ImpairmentThe value in use calculation uses cash flow projections based on financial forecasts fo

275、r the next two years approved by management andextrapolated for a 15 year period or the useful economic life,whichever is the shorter.In each case it is assumed there will be no growthbeyond 2016 and the cash flows of each acquisition are discounted at a rate of 10%,which approximates to the Groups

276、weighted averagecost of capital(see note 10).for year ended 31 December 201432Alliance Pharma plc|Annual Report 2014Financial Statements2.Summary of significant accounting policies continuedProvisionsProvisions have been made for onerous leases and associated costs(see note 24)and for slow moving an

277、d obsolete stock.Theseprovisions are estimates and the actual costs and timing of future cash flows are dependent on future events.The difference betweenexpectations and the actual future liability will be accounted for in the period when such determination is made.Deferred considerationThe Company

278、determines that where there is an obligation to pay consideration dependent on the sale of a product,and the Company cancontrol whether the product is sold or not,the consideration is only recognised once a sale is made.Consolidation of Joint VenturesThe Group owns 60%of the issued share capital of

279、Unigreg Limited.The Group considered the existence of substantive participatingrights held by the minority shareholder which provide that shareholder with a veto right over the significant financial and operatingpolicies of Unigreg Ltd and determined that,as a result of these rights,the Group does n

280、ot have control over the financial and operatingpolicies of Unigreg Ltd,despite the Groups 60%ownership interests consequently the company is accounted for as a joint venture.The Group owns 20%of the issued share capital of Synthasia International Company Limited(Synthasia).The Group considered thee

281、xistence of substantive participating rights held by both the Group and another shareholder which provide both parties with a veto rightover the significant financial and operating policies of Synthasia and determined that,as a result of these rights,Synthasia is accountedfor as a joint venture.In a

282、ccordance with IFRS 11,the Groups investments made to date in joint arrangements are characterised as joint ventures in which the Group has rights to a share of the arrangements net assets rather than direct rights to underlying assets and obligation forunderlying liabilities.2.4 Revenue recognition

283、Revenue comprises the fair value of the consideration received or receivable for the sale of goods in the ordinary course of the Groupsactivities.Revenue is shown net of value-added tax,estimated returns,rebates and discounts and after eliminating sales within the Groupand represents amounts invoice

284、d to third parties in relation to the Groups sole principle activity namely the distribution ofpharmaceutical products.Revenue is recognised when a Group entity has delivered products to the customer and confirmation of receiptis confirmed.The risks and rewards are transferred upon customers receivi

285、ng the goods.2.5 Foreign currency transactionsThe consolidated financial statements are presented in sterling,which is the presentational currency of the Group and the functionalcurrency of the parent Company.Foreign currency transactions by Group companies are booked at the exchange rate ruling on

286、the date ofthe transaction.Foreign currency monetary assets and liabilities are retranslated into local currency at the rate of exchange ruling at thebalance sheet date.Exchange differences are booked to the income statement.2.6 Property,plant and equipmentComputer equipment,fixtures,fittings and eq

287、uipment are stated at the cost of purchase less any provisions for depreciation andimpairment.The rates generally applicable are:Computer equipment20%33.3%per annum,straight lineFixtures,fittings and equipment20%25%per annum,straight lineMaterial residual value estimates are updated as required,but

288、at least annually,whether or not the asset is revalued.2.7 LeasesLeasing agreements which transfer to the Group substantially all the benefits and risks of ownership are treated as finance leases,as ifthe asset had been purchased outright.The assets are included within computer equipment,fixtures,fi

289、ttings and equipment and thecapital element of the leasing commitments are shown as obligations under finance leases.Assets held under finance leases aredepreciated on a basis consistent with similar owned assets or the lease term if shorter.The interest element of the lease rental isincluded in the

290、 income statement.All other leases are considered operating leases and the annual rentals are included in the incomestatement on a straight line basis over the lease term.2.8 GoodwillGoodwill represents the excess of the consideration transferred over the fair value of the Groups share of the identi

291、fiable net assetsacquired.Goodwill is reviewed for impairment at least annually by assessing the recoverable amount of each acquisition,considered to bea cash-generating unit,to which the goodwill relates.The recoverable amount is the higher of fair value less costs to sell and value inuse.When the

292、recoverable amount of the cash-generating unit is less than the carrying amount an impairment loss is recognised.Anyimpairment is recognised immediately in the Group Income Statement and is not subsequently reversed.33Alliance Pharma plc|Annual Report 2014Notes to the Financial Statements continuedf

293、or year ended 31 December 20142.Summary of significant accounting policies continued2.9 Intangible assetsAcquired intangible assetsIntangible assets are stated at the lower of cost less provision for amortisation and impairment or the recoverable amount(explainedfurther in note 10).Technical know-ho

294、w and trademarks are deemed to have an indefinite useful life and are tested for impairmentannually.Distribution licences are amortised over the current life of the licence on a straight line basis and are tested for impairmentannually,if the licence period can be extended the useful life of the int

295、angible asset shall include the renewal period only if there isevidence to support renewal by the entity without disproportionate cost.In determining the useful economic life of distribution rights eachacquisition has been reviewed separately and consideration given to the period over which the Grou

296、p expects to derive economic benefit.Internally-generated intangible assets Research and development expenditureResearch expenditure is charged to the Income Statement in the period in which it is incurred.Development expenditure is capitalisedwhen it can be reliably measured and the project it is a

297、ttributable to is separately identifiable,is technically feasible,demonstrates futureeconomic benefit,and will be used or sold by the Group once completed.The capitalised cost is amortised over the period during which the Group is expected to benefit and begins when the asset is ready for use.Develo

298、pment costs are reviewed at least annually for impairment by assessing the recoverable amount of each cash-generating unit,towhich the development costs relate.The recoverable amount is the higher of fair value less costs to sell and value in use.When therecoverable amount of the cash-generating uni

299、t is less than the carrying amount an impairment loss is recognised.Any impairment isrecognised immediately in the Group Income Statement.Any reversal of a previously recorded impairment loss in a subsequent periodwould also be recognised immediately in the Group Income Statement and is not subseque

300、ntly reversed.Development costs not meeting the recognition criteria are expensed as incurred.ImpairmentFor the purposes of assessing impairment,assets are grouped at the lowest levels for which there are separately identifiable cash flows(cash-generating units).As a result,some assets are tested in

301、dividually for impairment and some are tested at cash-generating unitlevel.Goodwill,other individual assets or cash-generating units that include goodwill,other intangible assets with an indefinite usefullife,and those intangible assets not yet available for use are tested for impairment at least an

302、nually.An impairment loss is recognised for the amount by which the assets or cash-generating units carrying amount exceeds its recoverableamount.The recoverable amount is the higher of fair value,reflecting market conditions less costs to sell,and value in use based on aninternal discounted cash fl

303、ow evaluation.Impairment losses recognised for cash-generating units,to which goodwill has been allocated,are credited initially to the carrying amount of goodwill.Any remaining impairment loss is charged pro rata to the other assets in the cashgenerating unit.With the exception of goodwill and deve

304、lopment costs,all assets are subsequently reassessed for indications that animpairment loss previously recognised may no longer exist.2.10 InventoriesInventories are included at the lower of cost less any provision for impairment or net realisable value.Cost is determined on a first-in-first-out bas

305、is using the weighted average cost.2.11 TaxationThe tax expense represents the sum of the tax currently payable and deferred tax.The tax currently payable is based on the taxable profit for the year.Taxable profit differs from profit reported in the income statementbecause the former excludes items

306、of income or expense that are either taxable or deductible in other years or that are never taxable ordeductible,and it includes tax reliefs that are not included in the income statement.The Groups liability for current tax is calculatedusing tax rates that have been enacted or substantively enacted

307、 by the balance sheet date.Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amount of assets and liabilities in thefinancial statements and the corresponding tax bases used in the computation of taxable profit,and is accounted for using the balanceshe

308、et liability method.Deferred tax liabilities are provided in full on temporary differences,and deferred tax assets are recognised to theextent that it is probable that future taxable profits will be available against which the temporary differences can be utilised.Deferred taxis provided using the r

309、ates of tax that are expected to apply in the period when the liability is settled or the asset is realised,based onrates that have been substantively enacted by the balance sheet date.Deferred tax assets and liabilities are not discounted.The Groupjointly controls the sharing of profits in the join

310、t venture and as such no deferred tax has been recognised on temporary differences.34Alliance Pharma plc|Annual Report 2014Financial Statements2.12 Derivative financial instruments and hedging activitiesDerivative financial instruments are used to manage exposure to market risk from treasury operati

311、ons.The principal financial instrumentused by the Group is interest rate swaps.The Group does not hold or issue derivative financial instruments for trading or speculativepurposes.Derivative financial instruments are recognised in the balance sheet at fair value and then re-measured at subsequentrep

312、orting dates.The fair value is calculated by reference to market interest rates and supported by counterparty confirmation.The interest rate swaps are designated as cash flow hedges.The effective portion of changes in the fair value of derivative financial instruments that are designated as cash flo

313、w hedges is recognisedin other comprehensive income,while the gain or loss relating to the ineffective portion is recognised immediately in the incomestatement.Changes in the fair value of derivative financial instruments that are not designated as cash flow hedges are recognised in theincome statem

314、ent as they arise.2.13 Debt instrumentsDebt instruments are initially stated at their fair value net of issue costs,and subsequently measured at amortised cost using theeffective interest rate method.Convertible Unsecured Loan Stock issued by the Company is regarded as compound financial instruments

315、.Compound financialinstruments are split and recorded respectively within each of its two components,equity and liability.The fair values of the liabilitycomponent and the equity conversion component were determined at issuance of the bond.The equity component was determined as niland the fair value

316、 of the liability component,included in long-term borrowings,was calculated using a market interest rate for anequivalent non-convertible bond.2.14 Trade payablesTrade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest ratemethod.

317、2.15 Financial assets loans and receivablesLoans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market.They are included in current assets,except for maturities greater than 12 months after the balance sheet date.These are cla

318、ssified asnon-current assets.The Groups loans and receivables comprise trade and other receivables and cash and cash equivalents in thebalance sheet(note 2.16 and 2.17).2.16 Trade receivablesTrade receivables are recognised initially at fair value and subsequently measured at amortised cost using th

319、e effective interest method,less provision for impairment.A provision for impairment of trade receivables is established when there is objective evidence that theGroup will not be able to collect amounts due according to the original terms of the receivables.2.17 Cash and cash equivalentsFor the pur

320、pose of the cash flow statement,cash and cash equivalents comprise cash on hand,deposits held at call with banks,othershort-term highly liquid investments,available with no penalty,with original maturities of three months or less,bank overdrafts andworking capital facilities.2.18 Employee benefits s

321、hare-based compensationThe Group operates an equity-settled,share-based compensation plan.The fair value of the employee services received in exchange forthe grant of the options is recognised as an expense over the vesting period.The total amount to be expensed over the vesting period isdetermined

322、by reference to the fair value of the options granted.Non-market vesting conditions are included in assumptions about thenumber of options that are expected to become exercisable.At each balance sheet date,the Group revises its estimates of the number ofoptions that are expected to become exercisabl

323、e.It recognises the impact of the revision of original estimates,if any,in the Group IncomeStatement,with a corresponding adjustment to equity.The proceeds received net of any directly attributable transaction costs arecredited to share capital(nominal value)and share premium when the options are ex

324、ercised.2.Summary of significant accounting policies continued35Alliance Pharma plc|Annual Report 2014Notes to the Financial Statements continuedfor year ended 31 December 20142.19 EquityEquity comprises the following:“Share capital”represents the nominal value of equity shares.“Share premium”repres

325、ents the excess over nominal value of the fair value of consideration received for equity shares,net of expensesof the share issue.“Share option reserve”represents equity-settled share-based employee remuneration until such share options are exercised.“Other reserves”represents the fair value of der

326、ivative financial instruments at the balance sheet date that are designated as cash flowhedges net of deferred tax,less amounts reclassified through other comprehensive income.“Retained earnings”represents retained profit.“Reverse takeover reserve”represents the difference between the fair value and

327、 nominal value of shares issued on a reverse takeover.2.20 InvestmentsInvestments in subsidiaries included in the Companys balance sheet are stated at cost less any provision for impairment.2.21 ProvisionsProvisions are recognised when there is a present legal or constructive obligation as a result

328、of a past event,for which it is probable that a transfer of economic benefits will be required to settle the obligation and where a reliable estimate can be made of the amount ofthe obligation.Where material,the provisions have been discounted to their present value.2.22 Business combinationsBusines

329、s combinations are accounted for using the acquisition accounting method.Identifiable assets,liabilities and contingent liabilitiesacquired are measured at fair value at acquisition date.The consideration transferred is measured at fair value and includes the fairvalue of any contingent consideratio

330、n.The costs of acquisition are charged to the income statement in the period in which they areincurred.2.23 New standards not yet appliedA number of new EU adopted standards,amendments to standards and interpretations are not yet effective for the year ended 31December 2014 and have not been applied

331、 in preparing these financial statements.The following list is not comprehensive but includesthe most significant to these financial statements:l IFRS 9 Financial Instruments(2014),representing the completion of the IASB project to replace IAS 39 Financial Instruments:Recognition and Measurement.The

332、 new standard introduces extensive changes to IAS 39s guidance on the classification andmeasurement of financial assets and introduces a new expected credit loss model for the impairment of financial assets.IFRS 9 alsoprovides new guidance on the application of hedge accounting.The new standard is r

333、equired to be applied for annual reporting periodsbeginning on or after 1 January 2018.l IFRS 15 Revenue from Contracts with Customers replaces IAS 18 Revenue,IAS 11 Construction Contracts,and several revenue-related Interpretations.The new standard establishes a control-based revenue recognition model and provides additional guidance inmany areas not covered in detail under existing IFRSs,includi