Advanced Medical Solutions Group plc Annual Report 2022

FY2022 Annual Report · Advanced Medical Solutions Group plc

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Resilience,
innovation
and growth

Annual Report & Accounts 2022

A B O U T A M S

Advanced Medical
Solutions Group plc
is a world-leading
specialist in tissue-
healing technologies.

“Given the current challenging economic
conditions, I am delighted with the resilience
that our business has shown in delivering
another period of strong financial performance.“
Chris Meredith, Chief Executive Officer

Company Overview
01 Highlights
02 AMS at a Glance
04 Why Invest in AMS

Strategic Report
06 Our Business Model
08 Year in Review
10 Chief Executive’s Q&A
12 Market and Business Overview
14 Our Strategy
18 Key Performance Indicators
20 Operating Review – Surgical Business Unit
22 Operating Review – Woundcare Business Unit
24 s172 (Stakeholder Engagement)
28 Environmental, Social and Governance
40 Financial Review
43 Risk Management

Governance
48 Board of Directors
50 Senior Management Team
52 Corporate Governance Report
58 Nomination Committee Report
61 Audit Committee Report
65 Remuneration Committee Report
76 Directors’ Report

Financial Statements
79
Independent Auditor’s Report
87 Consolidated Income Statement
88 Consolidated Statement of
Comprehensive Income

89 Consolidated Statement of Financial Position
90 Consolidated Statement of Changes in Equity
91 Consolidated Statement of Cash Flows
92 Notes Forming Part of the

Consolidated Financial Statements
123 Company Statement of Financial Position
124 Company Statement of Changes in Equity
125 Notes to the Company Financial Statements
130 Five Year Summary
130 Alternative Performance Measures
131 Advisors

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H I G H L I G H T S

Group revenue
(£ million)

£124.3m

2021: £108.6m Change: +14%
(+10% at constant currency1)

2020: £86.8m

Diluted earnings per share
(p)

Adjusted2 profit before tax margin
(%)

9.30p

22.9%

2021: 8.01p Change: +16%

2021: 23.6% Change: -0.7pp

2020: 3.94p

2020: 15.4%

Profit before tax margin
(%)

Adjusted2 diluted earnings per share
(p)

Net operating cash flow
(£ million)

20.8%

10.47p

£26.9m

2021: 20.2% Change: +0.6pp

2021: 9.66p Change: +8%

2021: £31.0m Change: -13%

2020: 11.6%

Profit before tax
(£ million)

£25.9m

2020: 5.44p

Net cash3
(£ million)

£82.3m

2020: £21.5m

Adjusted2 profit before tax
(£ million)

£28.5m

2021: £22.0m Change: +18%

2021: £73.0m Change: +13%

2021: £25.6m Change: +11%

2020: £10.1m

2020: £53.8m

2020: £13.4m

AMS is pleased to report robust financial performance
in line with expectations and significant regulatory
and clinical progress, as we continue to invest in
our portfolio of next-generation products.

Proposed full-year dividend
per share (p)

2.15p

2021: 1.95p Change: +10%

2020: 1.70p

Financial

Operational

Post-period end

• Strong revenue and profit growth

• Good progress with FDA on

despite challenging macro-
economic conditions.

• Investment in R&D increased to

£12.3 million (2021: £9.3 million),
9.9% of revenues, accelerating
investment in key projects, including
the Medical Devices Regulation.

• Surgical Business Unit revenues
increased to £74.9 million (2021:
£64.6 million).

• Woundcare Business Unit revenues
increased to £49.5 million (2021:
£44.0 million).

US LiquiBandFix8® Pre-Market
Approval (PMA), with approval
on track for H2 2023.

• Seal-G® and Seal-G® MIST clinical
study progressing well with over
80% of patients recruited. Final
results are on track for H1 2023
for use in marketing during
the commercial launch.

• LiquiBand® XL was launched in
the US and received a positive
market response.

• Completed the acquisition of AFS
Medical GmbH, an Austria-based
distributor of minimally invasive
surgical devices.

• Acquisition of Connexicon Medical
Ltd, a tissue adhesive technology
specialist, in February 2023 for
an initial upfront payment of
€7 million with further deferred
payments dependent on delivery
of key milestones. The acquisition
strengthens our position in the
$300 million global medical
adhesive market and provides
significant commercial
opportunities.

1. Constant currency removes the effect of currency movements by re-translating the current year’s performance at the previous year’s exchange rates.

2. Adjusted profit before tax is shown before amortisation of acquired intangible assets which was £3.4 million (2021: £3.2 million) and the movement in long-term liabilities

recognised on acquisitions which was a credit of £0.8 million (2021: £0.4 million debit) and exceptional items which were £nil (2021: £nil), as reconciled in the Financial Review
(see pages 40 to 42).

3. Net cash consists of cash and cash equivalents with nil debt (2021: £nil debt).

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

A M S A T A G L A N Ce

what we are:
Headquartered in the UK, we are a world-
leading specialist in tissue-healing technologies
employing over 800 people in 12 locations.

Our Mission:
l To develop.
l To make a real difference.
l To add value.

Our vision:
A world where the outcome of
every patient can benefit from
our products and a company
where every employee feels
invested and valued.

manufacturing
and R&D locations

1. Winsford, UK HQ
2. Plymouth, UK
3. Stafford, UK
4. Etten Leur, Netherlands
5. Nuremberg, Germany
6. Domazlice, Czech Republic
7. Neustadt, Germany
8. Haifa, Israel
9. Nantes, France
10. Vienna, Austria
11. Dublin, Ireland
12. Moscow, Russia1

Key for Map:

R&D
Manufacturing
Sales

1. Small legacy sales office contributing

less than 1% of operating profit.

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>800

employees

Our Cultural values:
Care
Respects colleagues, encourages
and values all contributions
Focuses on the bigger picture
Open minded and takes
appropriate action

Fair
Takes accountability
and responsibility
Transparent and open in our
communication and actions
Acts as a team player to
deliver outcomes

Dare
Demonstrates determination
& persistence
Uses critical thinking and
creativity to find solutions
Finds value added improvements

>80

countries sold into

£124.3m

group Sales

>100

Distribution partners

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

wH Y I Nv eS T I N A M S

AMS’ resilience and innovation
positions us to deliver long-term
sustainable growth for investors

Innovation and Growth

Manufacturing and Regulatory

Defensive markets

Strong financials

A well-developed pipeline of innovative products and
a series of strategic acquisitions have established a range
of globally recognised tissue-healing brands, generating 9%
revenue CAGR over 10 years. We believe that our ongoing
commitment to innovation will create more growth drivers,
recurring revenues and better outcomes for clinicians and
patients, whilst providing value for payors.

Ongoing investment in innovation through specialist R&D hubs
continues to expand our range of revenue-generating product
platforms with strong gross margins, reducing the reliance
on any single market and generating more consistent,
recurring revenues. In 2022 we invested £12.3 million in R&D,
representing 9.9% of sales (2021: £9.3 million, 8.6% of sales).

We are underpinned by an established and profitable portfolio
of in-house developed and acquired products. Successful
commercialisation and growth have been achieved through
our flexible distribution strategy in over 80 global territories.
Continued expansion of this network is further extending
the platform for growth.

We manufacture almost all of our products across nine,

specialist, multi-national locations. Extensive investment
in regulatory infrastructure ensures a smooth transition of
new products into the market at a time of increasing global
regulatory requirements.

We operate in global healthcare markets where spending is

Consistent top-line growth, good profitability and strong

increasing as the global population ages and where treatment

cash-generation after payment of a dividend has established

backlogs are at a record high. The surgical and woundcare

a robust balance sheet. This enables us to invest in long-term

products we offer are used on a daily basis, making the

growth opportunities and leverage our business model further

business highly cash generative with recurring revenues.

through internal innovation and a targeted acquisition strategy.

The level of technical expertise, lean manufacturing practices
and quality processes throughout all of our specialist facilities
allows us to deliver top-quality products and excellent service
to a broad range of customers.

The number of recent approvals across our product portfolio
in the US market demonstrates our ability to work with the
FDA and meet its requirements. In addition, significant
investment in regulatory processes has enabled us to comply
with increasing levels of regulatory requirements dictated by
the new European Medical Devices Regulation (MDR) and we
are well prepared to meet the deadlines that have been set.

Our supply chain is tightly managed, helping to prevent any

disruption to business while inflationary pressures are

managed through negotiated price rises with our customers.

In addition, the business is not leveraged, shielding it from

interest fluctuations.

With a cash position of £82.3 million (as at 31 December 2022)

and significant debt-funding potential, we have the potential

to leverage our business model further. This will be achieved

through ongoing investment in our new product pipeline

and strategically aligned acquisitions that can expand the

The essential nature of healthcare and increasing pressure

technology base, increase manufacturing capability and

on healthcare systems ensures a consistent and rising demand

enhance distribution coverage.

Through this organic and acquisitive growth strategy, we

believe we can sustain robust, long-term growth ahead of

the market rate, increase our profitability and maximise

returns for shareholders.

for tissue-healing technology used during surgical procedures,

emergency intervention and the treatment of chronic wounds.

The unprecedented length of surgery waiting lists illustrates

the pent-up demand that fuels growth in these markets,

while healthcare providers endeavour to accelerate patient

throughput to address the backlog. In addition, our diversified

range of product platforms allows us to mitigate against

movements in the surgical or woundcare markets.

In spite of the global supply chain crisis, we have successfully

managed the supply of raw materials, preventing any disruption to

product shipment. Global inflationary pressure has been addressed

through careful pricing negotiation with our customers, ensuring

wherever possible that profits are not significantly impacted.

15.4%

Sales from products launched
in the previous five years

8.7%

Sales CAGR¹
over 10 years

Compound Annual
Growth Rate

59.0%

Gross
margin

87%

Customer service %
(OTIF: On-Time-In-Full)

Countries

sold into

32.8%

US sales as %

of Group

£26.9m

Net operating

cashflow

22.9%

Group adjusted

profit margin

See Our Strategy in action on pages 14 to 17

See Operating reviews on pages 20 to 23

See KPIs on pages 18 to 19

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Innovation and Growth

Manufacturing and Regulatory

Defensive markets

Strong financials

A well-developed pipeline of innovative products and

a series of strategic acquisitions have established a range

We manufacture almost all of our products across nine,

specialist, multi-national locations. Extensive investment

of globally recognised tissue-healing brands, generating 9%

in regulatory infrastructure ensures a smooth transition of

revenue CAGR over 10 years. We believe that our ongoing

new products into the market at a time of increasing global

commitment to innovation will create more growth drivers,

regulatory requirements.

recurring revenues and better outcomes for clinicians and

patients, whilst providing value for payors.

The level of technical expertise, lean manufacturing practices

and quality processes throughout all of our specialist facilities

Ongoing investment in innovation through specialist R&D hubs

allows us to deliver top-quality products and excellent service

continues to expand our range of revenue-generating product

to a broad range of customers.

platforms with strong gross margins, reducing the reliance

on any single market and generating more consistent,

recurring revenues. In 2022 we invested £12.3 million in R&D,

representing 9.9% of sales (2021: £9.3 million, 8.6% of sales).

The number of recent approvals across our product portfolio

in the US market demonstrates our ability to work with the

FDA and meet its requirements. In addition, significant

investment in regulatory processes has enabled us to comply

We are underpinned by an established and profitable portfolio

with increasing levels of regulatory requirements dictated by

of in-house developed and acquired products. Successful

the new European Medical Devices Regulation (MDR) and we

commercialisation and growth have been achieved through

are well prepared to meet the deadlines that have been set.

our flexible distribution strategy in over 80 global territories.

Continued expansion of this network is further extending

the platform for growth.

Consistent top-line growth, good profitability and strong
cash-generation after payment of a dividend has established
a robust balance sheet. This enables us to invest in long-term
growth opportunities and leverage our business model further
through internal innovation and a targeted acquisition strategy.

With a cash position of £82.3 million (as at 31 December 2022)
and significant debt-funding potential, we have the potential
to leverage our business model further. This will be achieved
through ongoing investment in our new product pipeline
and strategically aligned acquisitions that can expand the
technology base, increase manufacturing capability and
enhance distribution coverage.

Through this organic and acquisitive growth strategy, we
believe we can sustain robust, long-term growth ahead of
the market rate, increase our profitability and maximise
returns for shareholders.

We operate in global healthcare markets where spending is
increasing as the global population ages and where treatment
backlogs are at a record high. The surgical and woundcare
products we offer are used on a daily basis, making the
business highly cash generative with recurring revenues.
Our supply chain is tightly managed, helping to prevent any
disruption to business while inflationary pressures are
managed through negotiated price rises with our customers.
In addition, the business is not leveraged, shielding it from
interest fluctuations.

The essential nature of healthcare and increasing pressure
on healthcare systems ensures a consistent and rising demand
for tissue-healing technology used during surgical procedures,
emergency intervention and the treatment of chronic wounds.
The unprecedented length of surgery waiting lists illustrates
the pent-up demand that fuels growth in these markets,
while healthcare providers endeavour to accelerate patient
throughput to address the backlog. In addition, our diversified
range of product platforms allows us to mitigate against
movements in the surgical or woundcare markets.

In spite of the global supply chain crisis, we have successfully
managed the supply of raw materials, preventing any disruption to
product shipment. Global inflationary pressure has been addressed
through careful pricing negotiation with our customers, ensuring
wherever possible that profits are not significantly impacted.

15.4%

8.7%

Sales from products launched

Sales CAGR¹

in the previous five years

over 10 years

Compound Annual

Growth Rate

59.0%

Gross

margin

87%

Customer service %

(OTIF: On-Time-In-Full)

Countries
sold into

32.8%

US sales as %
of Group

£26.9m

Net operating
cashflow

22.9%

Group adjusted
profit margin

See Our Strategy in action on pages 14 to 17

See Operating reviews on pages 20 to 23

See KPIs on pages 18 to 19

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

O Ur B U S I NeS S M O DeL

O Ur
M I S S I O N

To develop. To make a real difference. To add value.
Achieved through Our Value Chain

Research and new
product development
Research and
development.
Design and
testing.

9.9%

of sales invested in R&D

Regulatory
approval
Approvals for
new products and
new territories.
Maintain
approvals for
existing products/
markets.

new product launches

Routes
to market
Flexible routes
to market
incorporating our
direct sales team,
global network of
distributors and
OEM partners.

>100

distribution partners

For information see Our Supply Chain on page 26

Operations

Manufacturing.
Security of supply.
Supply chain
resilience.
Quality assurance.

locations of specialist,
manufacturing facilities

U N D e r P I N Ne D
B Y O U r eS G
F r A M e wO r K

Planet

People

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O U r S Tr A Te G I C
P I L L A r S

DeL Iv e r I N G F Or
O Ur S T A KeH O L De rS

Growth
Exploiting the opportunities
arising from having a broad
product range sold into large
addressable markets via
multiple routes to market and
across multiple geographies.

Innovation
Strengthening our portfolio
by developing or acquiring
market-leading, high-quality
products and investing in
people to deliver innovation.

Operational
Excellence
Continuously improving our
operations to drive out cost
and improve margin; focus
on what our customers
need and value to minimise
operational risk.

People and
Culture
Investing in recruiting and
developing talent while
embedding our Care,
Fair, Dare values.

Our Patients
Delivering excellent
outcomes for our
Patients.

Our Employees
Being a great place
for our Employees
to work.

Our Investors
Delivering long-term
sustainable growth and
value for our Investors.

Our Clinicians
Delivering effective,
efficient and safe
technologies for
our Clinicians.

Our Partners
Delivering quality and
value for our Partners.

Our Regulators
Meeting the evolving
requirements of our
Regulators.

Our Communities
and Environment
Getting involved in
our Communities and
minimising our impact
on the Environment.

Our Supply Chain
Developing strong,
mutually beneficial
relationships with
our Supply Chain.

For information see Our Strategy on pages 14 to 17

For information on Our Stakeholders see pages 25 to 26

Product

Policy

A
M
S

For Information on our ESG policies see pages 28 to 39

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

YeAr I N r e vIe w

We proactively managed our supply chain to
improve resilience, by increasing inventory levels
and dual sourcing certain key raw materials. As
a consequence we experienced no significant
impacts of the supply chain crisis. In addition, we
negotiated price increases from our customers
that enabled us to recover the majority of the
impacts of high inflation and protect our value.

We delivered gross 4% cost reduction projects
across our sites to partially offset cost inflation,
protecting our margin against the impacts of the
rising cost-of-living, inflation and raw material
costs, and strengthening the resilience of our
business. Our investment in an external consultant
to support our ‘Pathway to Net Zero’ work will
help us to reduce our carbon footprint and
further reduce costs.

The resilience of the business requires the
dedication, hard work and adaptability of our
employees. We have taken a number of actions to
support our employees, who are key stakeholders,
including supporting lower earners with additional
cost-of-living payments, managing COVID safe
environments across all of our operating sites,
while supporting our operations by restructuring
and recruiting new talent to the operations
leadership team. Our ESG activities further
enhance the resilience of the business and
support our employees, resulting in low attrition
and an increased employee engagement score.

All sites have completed continuous improvement
maturity assessments and are deploying our
continuous improvement framework, focused
on a mix of lean and six-sigma application.
Heightened quality awareness through further
investment in training and “quality days”,
continued good safety performance and
implementation of key investments to deliver
capacity, reduce cost and lower business risk all
enabled our employees to be resilient and help
our commercial teams to deliver our 2022 results.

Revenue

£124.3m

(2021: £108.6m), +14%
(+10% at constant currency1)

Resilience,
Innovation
and Growth

Resilience
Given the challenging global economic conditions,
AMS’s 2022 performance demonstrates strong
resilience. The world experienced an unusually
high number of significant challenges in 2022
related to residual COVID-19 factors and the
impacts of the war in Ukraine, such as the global
supply chain crisis, staff shortages, high inflation,
high interest rates and volatile exchange rates.
Our business model, financial structure and
balance sheet strength makes us less exposed to
these external factors than many other businesses.

1. Constant currency removes the effect of currency movements by re-translating the current year’s performance at the previous year’s exchange rates.

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Adjusted2 profit before tax

net cash3

£28.5m

(2021: £25.6 million) +11%

£82.3m

(2021: £73.0 million) +13%

investment in R&D

£12.3m

(2021: £9.3 million),
representing 9.9% of
revenues (2021: 8.6%)

The Premarket Approval (PMA) for LiquiBandFix8®,
expected in H2 2023, adds a major new growth
opportunity as the first product of its kind in the
US with launch anticipated at the end of 2023.

The investments in our in-house and acquired
technologies enable us to deliver returns across
a broader product range and validate our growth
strategy. We are committed to investing in R&D
and acquisitions to further strengthen our
established portfolios while penetrating
new markets and maintaining long-term
sustainable growth.

Summary
The Group is well placed to navigate the macro-
economic challenges. We have proven our ability
to recover the majority of energy and other cost
inflation by increasing selling prices, are insulated
from high interest rates due to our cash position
and our products do not rely on consumer
demand exposed to recessionary factors.

These factors, along with the proven commercial
strategy to increase market share in our large
markets with innovation and geographical
expansion, leaves us well placed for continued
growth both in the short and long-term.

Innovation
We increased our investment in innovation,
making significant progress with Seal-G®, our
novel internal biological sealant to address a large
unmet need to reduce leaks in gastrointestinal
surgery. Its first human trial is on track for
completion in H1 2023 and first end-user sales
to surgeons were achieved in early 2023 ahead
of the European launch in H2 2023.

Our Group R&D team also made innovation
advances, including progressing several key
projects in our innovation and development
pipeline, developing an in-house manufacturing
process for collagen membrane, setting up
a Group stability capability and introducing
an improved process for identifying new
innovations to meet unmet patient needs.

The acquisition of Connexicon Medical brings
a highly experienced R&D team with a new
medical adhesive development hub in Dublin,
strengthening AMS’s ability to develop and launch
innovative adhesive and sealant technologies.

We made significant progress in meeting MDR
standards and expect to complete the project
well ahead of the new 2027/2028 deadline.

Growth
We delivered record sales in 2022 with all product
categories delivering year on year growth. Both
Business Units performed well, with Surgical sales
in LiquiBand® Rest of World, Biosurgicals and
LiquiBandFix8® driving growth and the Woundcare
ActivHeal® expansion strategy progressing well,
with new partners appointed in markets where
key partners have a low presence. The strategic
review of our US LiquiBand® routes to market
and product offering is progressing well and
is expected to drive stronger growth
in this key market sector from
mid-2023.

2. Adjusted profit before tax is shown before amortisation of acquired intangible assets which was £3.4 million (2021: £3.2 million) and the movement in long-term liabilities

3. Net cash consists of cash and cash equivalents with nil debt (2021: £nil debt).

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

C H IeF eXeC U T Iv e’ S
Q & A

How do you assess the performance of the Group
in 2022?

I am pleased with the resilience that our business has
shown in delivering another period of strong financial
performance in the current challenging economic
conditions. Revenue increased to £124.3 million
(2021: £108.6 million) and profit before tax
increased to £25.9 million (2021: £22.0 million).

What is the background to the strategic review

of US LiquiBand®?

The strategic review of our US LiquiBand® business was
to assess and streamline our routes to market and product
offering in order to help drive stronger growth in this key
market sector. As part of this initiative, we identified and
first made contact with Connexicon as a potential
acquisition target. We intend to complete this strategic
review during 2023 and it is expected that this will result
in improved market access and growth potential from
mid-2023.

How is the product portfolio progressing?

The investments we have made in our in-house and
acquired technologies have strengthened the quality
and breadth of our portfolio enabling us to deliver returns
across a broader range and validate our growth strategy.
We are committed to investing in R&D and acquisitions
that will further strengthen our established portfolios
while continuing to penetrate new markets, and
maintaining robust growth in the long-term.

How is the Group coping with global supply chain
and inflation conditions?

We have taken proactive steps to mitigate risks arising

from global supply chain challenges such as increasing
inventory levels and setting up alternative suppliers where
feasible. As a result, shortages of material have not had
a significant impact on our ability to supply products to
our customers. Given the long shelf life of our materials
and finished goods, the risk of inventory obsolescence
is low but is closely monitored and provisions are made
where relevant. We continue to closely monitor the
global supply chain situation.

Inflationary pressures continue to be felt across the
business through higher cost of goods, energy prices
and staff costs. However, we continue to successfully
recover a significant proportion of this impact from
our customers through price review negotiations.

Chris Meredith,
Chief Executive
Officer

The Group
performed well
in 2022 and made
good progress on
key projects to
strengthen our future
growth prospects.

Advanced Medical Solutions Group plc Annual Report & Accounts 2022

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What is the update on the Medical

Whilst in recent years the Group’s completed transactions

Devices Regulation?

In December 2022, the EU Commissioner announced
that the enforcement of the Medical Devices Regulation
(MDR) would be delayed until 2027 or 2028 depending
on the classification of the device. Given the progress
we have already made, we expect positive responses
to our applications for certificate extensions for product
certificates expiring before these dates. It is anticipated
that competitors that have not made MDR progress
may be unable to secure such extensions.

We plan to maintain our current schedule of work to meet

the new standards and anticipate that the phasing of our
capitalisation of R&D costs relating to MDR will be broadly
unchanged. At the current time, of the 55 AMS product
groups going through MDR, 30 have been approved or are
awaiting self-declaration, 19 are with the Notified Bodies
ahead of their review and the remaining 6 files are being
readied for submission to Notified Bodies in the next
12 months.

How did the Group’s key clinical and innovation
projects progress during the year?

Investment in R&D increased to 9.9% of revenues
as the Group continues to strengthen its pipeline by
accelerating investment in new products and MDR.

Seal-G® MIST (laparoscopic surgery) and Seal-G®
(open surgery) are novel, internal, biological sealants
used to seal tissue during gastrointestinal surgery to
reduce bleeding and leakage of fluid. The trial continues
to progress well with over 80% of the 160 procedures
now complete, with results on track for H1 2023
and launch planned for H2 2023.

In October 2022, AMS reported that the Premarket
Approval (PMA) for LiquiBandFix8® had been submitted
and accepted by the FDA. Since then, FDA engagement
has been high and the process is progressing well with
approval on track for H2 2023. This would be the first
product of its kind in the US and the anticipated launch
in 2024 represents a significant commercial opportunity
for AMS.

How is the M&A strategy progressing?

The Group continues to seek acquisitions that deliver
additional value for shareholders and meet the criteria
of being accretive businesses with strong R&D and
manufacturing capabilities, and/or that have products
or customers that offer effective commercial synergies.

In line with our stated strategy, the acquisition of AFS
Medical in March 2022 underlined the Group’s ambition
to expand our direct surgical footprint and capability.
The acquisition of Connexicon Medical in February
2023 illustrates our commitment to further expanding
key portfolios and ensuring that we remain at the
forefront of our core technologies.

have been strategic bolt-ons, a key focus of the recently
formed Corporate Business Development team is on
identifying larger, more transformative targets. With
cash of £82.3 million at the end of 2022, and access
to extensive debt facilities, we are well placed
to execute a deal of this nature.

What progress has been made on ESG in 2022?

Our ESG strategy remains focused on our environmental
impact, the wellbeing of our workforce, driving equality,
diversity and inclusion, and further strengthening our
corporate governance, internally and across our supply
chain. We believe that being a good corporate citizen
is critical to our long-term sustainable success.

Building on the ESG framework we developed in 2021,
the Group has made good progress in 2022. An important
step during the year was the appointment of Inspired plc
as our ESG partner. We have worked with Inspired to
create a ‘Pathway to Net Zero’ with an initial focus
on calculating our Scope 3 emissions and a Carbon
Balance Sheet.

The ESG Steering Committee continues to manage ESG
activities across the Group and have been supplemented
with a network of local ESG champions representing
each site and function, as well as an Equality, Diversity
and Inclusion Committee.

What is the outlook for 2023 and beyond?

The Group is well placed to navigate the ongoing
macro-economic challenges. We have proven our
ability to recover the majority of energy and other cost
inflation by increasing selling prices, are insulated from
high interest rates due to our cash position and our
products do not rely on consumer demand exposed
to recessionary factors.

These factors, along with our proven commercial strategy
to increase our market share in our large markets with
innovation and geographical expansion, leave us well
placed for continued growth both in the short and
long-term.

Influenced by the strategic review of our US LiquiBand®
business, and the associated 2024 launch timing for the
US Connexicon products, we expect weak US LiquiBand®
demand in H1 2023 as we finalise the strategic discussions
across our partner base, followed by recovery in H2 2023
and much stronger growth thereafter.

Given AMS’ resilience and the strength of its overall
portfolio, the Group remains on track to meet
market expectations for 2023.

Chris Meredith
Chief Executive Officer
18 April 2023

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

QAQAQAQAQA

M Ar KeT & B U S I NeS S
O v e r vIe w

We develop tissue-healing technologies in global markets,
which are driven by increasingly ageing populations and
innovative technology.

Surgical
The surgical market addressable by our products is estimated to be worth
approximately $6.4bn¹ globally with historic Compound Annual Growth
Rates (CAGRs) of between 0% and 8%.

$6.4bn

$0.3bn – Tissue Adhesives – LiquiBand®
$1bn – Biosurgical Devices – Collagens/other haemostatic devices
$0.65bn – Biosurgical Devices – Bone substitutes
$1bn – Internal Sealants – Seal-G®/Seal-G® MIST
$3bn – Sutures – RESORBA®
$0.4bn – Internal Fixation – LiquiBandFIX8®

Tissue Adhesives – LiquiBand®
LiquiBand® is our most successful
product range, having gained over
20% of end-volumes in the US market.
The brand has recovered well since
the COVID-19 pandemic and we are
confident of increased growth from
mid-2023 as we progress the strategic
review of our product offering and
routes to market. The launch of
LiquiBand® XL (large wounds) in 2022
was an important development for the
brand, providing access to a new $60
million market and unlocking further
growth potential for the LiquiBand®
business. Additional expansion in the
EU, APAC and LATAM regions continues
to support growth for the brand.

Biosurgical Devices – Collagens
We compete within the $1bn collagen/
other haemostatic devices market,
specifically targeting the surgical and
dental collagen segments. New approvals
for antibiotic surgical dressings help to
drive growth in Europe, while the Group
is working towards our first collagen
approval in the US, with a 510(k)
submission expected in 2023
for a dental application.

Biosurgical Devices –
Bone substitutes
The Group’s range of Bi-phasic
Tri-calcium phosphate products
addresses the $650m ceramics segment
of the synthetic bone substitute market.
The new RESORBA® branded bone
substitutes range, launched in 2021
and rolled out in a number of European
countries in 2022, has shown a promising
start. The Group continues to work
towards its planned bone substitute
pilot launch into the US market in
mid 2023, using independent reps.

Internal Sealants –
Seal-G®/Seal-G® MIST
The CE mark awarded to Seal-G®/
Seal-G® MIST in 2021 enables entry
into the EU portion of the $1bn market of
GI Tract sealants. Data from an ongoing
clinical trial is expected in H1 2023, with
a full European launch to follow. Key
Opinion Leader feedback continues
to be positive and we remain excited
about the opportunity that this product
presents in answering a high unmet
patient need for an effective GI sealant.

Sutures – RESORBA®
The Group targets a subset of the much
larger $3bn global suture market with
a direct market presence in Germany
and the UK, while supplying customers
in specialist applications. Although
this portfolio has been established in
predominantly European markets, the
Group’s ongoing strategy to expand the
geographic reach of existing products,
is making a significant contribution
to revenues.

Internal Fixation – LiquiBandFIX8®
Our LiquiBandFIX8® brand enables entry
to the hernia mesh fixation market,
removing the need for staples or tacks,
which reduces pain and recovery time.
Product revenues grew strongly in
Europe during 2022, supported by a UK
National Institute for Clinical Excellence
recommendation and the recent AFS
acquisition. A Premarket Approval (PMA)
for LiquiBandFix8® was submitted and
accepted by the FDA in H2 2022 and
US approval is expected in H2 2023,
representing a significant commercial
opportunity in 2024.

1 Sourced from various third-party data sources, market reports and internal estimates.

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$6.4bn

$4.2bn

Global Surgical market

Global Advanced Woundcare
dressings market

Woundcare
The global Advanced Woundcare dressings market is worth approximately $4.2bn, with historic product
CAGRs estimated to be between 0-5%. AMS competes in this market with its expertise focused on
foam and fibre-based materials. The estimated value of these segments is summarised below.

$4.2bn

$0.9bn – Infection Management
$2.6bn – Exudate Management
$0.7bn – Other Woundcare

Infection Management
Our antimicrobial range targets the
market for foam and fibre dressings
that are used to treat hard-to-heal
wounds at risk of infection. The Group
sustains a competitive edge through
innovation, which Includes dressings
that incorporate silver and
Polyhexamethylene Biguanide
(PHMB) technology.

Exudate Management
We specialise in fibre and foam dressings
that target the part of this market which
optimise the healing environment and
enhance tissue-healing without the use
of anti-infective agents. Innovation is
set to support growth and includes an
entry for dressings in the negative
pressure market.

Other Advanced
Woundcare Dressings
The global market of other advanced
dressings for woundcare in the treatment
of hard-to-heal wounds.

ActivHeal®
A branded range of Exudate
Management and Infection
Management products that
are marketed in the UK
and other markets.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

O Ur S TrA TeG Y

growth

+14%

Revenue
(2021: +25%)

Our growth strategy is to exploit opportunities from multiple routes to
market across numerous geographies with our diverse and expanding
portfolio of innovative tissue-healing products, which add value to
patients and payors and deliver equal or better clinical performance
to market-leading products.

What we have achieved in the year
• Delivered strong growth across multiple

product categories in both Business Units.

• Further geographical expansion via ActivHeal®

overseas, as well as Surgical products
into APAC.

• Secured ownership and distribution of
microbial surgical sealant, InteguSeal®,
to enable meaningful revenue generation.

Plans for the year ahead
• Connexicon acquisition in early 2023 adds
an existing European and APAC business
and enhances our US portfolio with
approvals expected by early 2024.

• Bone substitute pilot launch mid 2023,

using independent reps.

• Launch of Seal-G® is expected in late 2023,
following results from the initial clinical trial.

• Significant ActivHeal® growth expected
from partners appointed in recent years.

• Further increased demand expected
for specialist medical bulk materials.

Future priorities
• Diversifying the customer base and product

range to reduce exposure to individual
customers and products.

• US approvals to be sought for the wider
surgical product portfolio which has
huge potential for the Group.

• Further planned clinical trials for Seal-G® to
significantly increase its potential. Other
procedure types such as oesophageal
and pancreatic surgery could drive
additional demand.

• Investment in clinical programme to support
MDR readiness to secure claims extensions,
reimbursement and revenue growth.

• Deliver additional value from acquisitions,

delivering on multiple growth opportunities
and exploit the inherent commercial,
operational and regulatory synergies.

Key KPIs

• Revenue movement.

• Growth in EPS.

See pages 18 to 19

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Developing or acquiring high-quality products provides the opportunity
for expansion into new markets. We expect to develop and market intuitive
products that provide more effective, efficient and safer experiences for
surgeons and patients. We invest in developing talent capable of
delivering innovation for the business.

Key KPIs

• % revenue spend on
R&D and Innovation.

• % of sales from new

products launched in
previous five years.

See pages 18 to 19

What we have achieved in the year
• Approved and launched LiquiBand® XL
providing access to a new $60 million
market and unlocking further growth.

• Good progress with the first clinical trial
for Seal-G® to address a large unmet
need to reduce leaks in GI surgery.

• Achieved major milestone towards

accessing the sizable US Fix8 opportunity
with PMA submission in October 2022.

• introduced an improved process for
identifying new innovations to meet
unmet patient needs.

• Progressed several key projects in our
innovation and development pipeline.

Plans for the year ahead
• US approval and launch of Fix8® expected

around the end of 2023 represents a
significant commercial opportunity.

• Application of collagen technology into
developing a tissue scaffold designed to
treat hard-to-heal and stalled wounds.
Currently reviewing FDA questions
on our 510(k) submission.

• Progress the next-generation bone
substitute through internal focus
and external collaborations.

• Progress early-stage innovation

products into the product
development process.

Future priorities
• Strong and cohesive partnership with

commercial teams developing products
that meet large unmet patient needs.

• World-class execution of R&D projects
delivering high-quality products to
market in a timely manner.

• A pipeline of products that are

truly novel and innovative.

• Integrated, global R&D function

supporting strategic business objectives.

innovation

15.4%

Sales from products
launched in the
previous five years
(2021: 12.8%)

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

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operational
excellence

87%

on-time-in-Full (otiF)
(2021: 88%)

Operational Excellence is focused on delivering a culture of continuously
improving operations to drive out cost and improve margin while
consistently supplying high-quality products through an optimised,
agile and adaptable supply chain. We excel when we work together.

Future priorities
• Continuous improvement culture drives
process improvement, cost reduction
and improved quality.

• Optimised supply chain processes to

consistently deliver high level of customer
service and customer satisfaction to delight
our customers regardless of global conditions.

• Optimised Product Development Process

delivering speed to market through
‘right-first-time’ product approval
and effective industrialisation.

• Ensuring that our people have the
capability, expertise and resources
to drive success.

Key KPIs

• Customer Service
(OTIF – ‘On-Time-
In-Full’).

• Year-over-year
change in our
standard cost base.

See pages 18 to 19

What we have achieved in the year
• Proactive management of supply chains in
unprecedented global conditions; actions
include increasing inventory levels and dual
sourcing of key raw materials where feasible.

• Delivered projects achieving a 4% gross cost
reduction to partially offset cost inflation.

• Good progress on MDR (55 product groups;
30 have been approved or are awaiting self-
declaration, 19 are with the Notified Bodies
and 6 files are being readied for submission).

• Expanded Plymouth facility to accommodate
further growth and transfer of our Seal-G®
assembly process from Israel.

Plans for the year ahead
• Complete inventory build and further dual

sourcing of key raw materials where feasible
to mitigate supply chain conditions and MDR.

• Plans in place to deliver greater-than 4%

gross cost reduction across the sites in 2023.

• Gross margin improvement.

• Increased customer service metrics e.g. OTIF.

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Our employees drive our success. We actively promote our Care, Fair, Dare values, measure
employee engagement and develop engagement plans. We encourage internal promotions
and invest in apprenticeships to build our future talent. We are stronger together.

Key KPIs

• Employee attrition.

• Employee

Engagement Score.

See pages 18 to 19

What we have achieved in the year
• Revitalised performance management process

to focus on strengths-based assessments
linked to Care, Fair, Dare values.

Plans for the year ahead
• Roll out of D.R.I.V.E. initiative: Development,
Role Definition, Individual Performance,
Values Focus and Employee Recognition.

• Global Employee Survey conducted, improving

o ur engagement score for neutral or positive
employees to 87%. (2021: 83%).

• Corporate Training Programme to ensure
technical competency of all employees is
promoted to continue to develop individuals.

• CEO Live Global Webcasts allowing two-way

• Introduce recruitment assessment criteria to

communication for all employees.

minimise bias in recruitment.

• Increased and more accessible training

• Introduce Career Roadmaps in key areas.

and development.

• Employee Inclusion Groups on topics
such as mental health awareness,
diversity and menopause.

• Embedded ESG framework and processes and
delivered meaningful progress (as detailed on
page 35), including a number of activities
which positively impacted our employees.

• Annual Development Focus Area –

Building quality into all we do.

• Improved flexibility for employees

re hybrid working and flexible working.

• Further progress ‘Pathway to Net Zero’,
considered important by our employees
and the Board.

Future priorities
• Strengthen our Care, Fair, Dare framework
to nurture how we interact and achieve
success as a team.

• Commitment to attract, develop and retain

a diverse talented workforce.

• Listening to all views, taking feedback and
proactively seeking ways to remain agile
and customer-centric.

• Maintaining highest levels of health and safety.

• ESG activities to continue to drive positive
change and ensure that key stakeholders
understand our commitments to sustainability.

people and culture

84%

employee
engagement score
(2021: 76%)

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

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Measuring success

The Group has a range of Key Performance Indicators (KPIs)
which are used to monitor Group performance and measure
progress against our strategy.

Financial KPIs

Revenue movement at constant currency1 %

Adjusted2 diluted earnings per share (EPS)
movement %

+10%

2022

2021

2020

-15%

2019

2018

10%

12%

29%

+8%

2022

2021

2020

-45%

2019

2018

-8%

13%

78%

Definition
Net revenue adjusted for constant currency1.

Strategic linkage
Revenue growth is a key factor in providing long-term value for
our shareholders and demonstrates the successful execution
of the Group’s strategy.

Progress made in the year
Group revenue increased to £124.3 million (2021: £108.6 million), an
increase of 14%, or 10% at constant currency, driven by commercial
progress, foreign exchange tailwinds and higher pricing to recover
inflationary cost increases.

Year-over-year change in our average
standard cost3 %

Definition
Movement in adjusted2 diluted EPS achieved in the year.

Strategic linkage
EPS growth is a measure of financial progress and an important
factor in our aim of providing value for our shareholders.

Progress made in the year
Adjusted diluted earnings per share increased by 8% to 10.47p
(2021: 9.66p) reflecting the Group’s increased earnings after tax.
Diluted earnings per share increased by 16% to 9.30p (2021: 8.01p).

Non-Financial KPIs

Customer Service (OTIF) %

+3.7%

2022

2021

0.1%

2020

-0.1%

2019

2018

3.7%

2.8%

2.4%

87%

2022

2021

2020

2019

2018

87%

88%

89%

80%

83%

Definition
Measures the change in standard cost base3 against prior year.

Strategic linkage
Controlling our product Standard Costs is important for the
sustainability of the Group and demonstrates the successful
execution of our strategy.

Definition
On-Time-In-Full (OTIF) is a measure of whether we delivered on
our commitment to provide excellent service to our customers.

Strategic linkage
High OTIF ensures that patients have access to our products and
enable us to retain customers, meet contractual commitments and
protect growth.

Progress made in the year
High inflation caused by the global economic crisis resulted in it not
being possible to reduce our standard costs in 2022. Inflation was felt
across the business through higher cost of goods, energy prices and
staff costs. As a result, the standard cost base increased by 3.7% in 2022
(2021: increase of 0.1%) despite operational improvement activity.

Progress made in the year
Proactive management of its supply chain enabled AMS to retain
a fairly stable OTIF of 87% (2021: 88%) despite the global supply
chain challenges facing most companies. Ongoing initiatives such as
increasing inventory levels and setting up alternative suppliers where
feasible, enable us to target higher OTIF levels for 2023 and beyond.

1. Constant currency removes the effect of currency movements by re-translating the current year’s performance at the previous year’s exchange rates.
2. Adjusted profit before tax is shown before amortisation of acquired intangible assets which was £3.4 million (2021: £3.2 million) and the movement in long-term liabilities

3. Net cash consists of cash and cash equivalents with nil debt (2021: £nil debt).

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Key to strategic linkage in this report

Growth

Innovation

Operational

Excellence

Culture

% of revenue spend on R&D & Innovation

% of sales from new products launched in the
previous five years

9.9%

2022

2021

2020

2019

2018

9.9%

8.6%

9.1%

6.3%

5.8%

15.4%

2022

2021

2020

2019

2018

15.4%

12.8%

19.8%

23.6%

24.6%

Definition
Spend on R&D, Innovation & Regulatory Affairs as a % of sales in the
financial year.

Strategic linkage
As a developer of innovative and technologically advanced products,
investing resources in this area is critical to fulfilling the strategic goals
of the business.

Progress made in the year
The Group incurred £12.3 million of gross R&D spend in the period
(2021: £9.3 million), representing 9.9% of sales (2021: 8.6%), reflecting
increased investment in innovation and in meeting increasing
regulatory standards.

Definition
This is a measure of the % of sales the Group is generating from
products launched in the five years prior to that year.

Strategic linkage
Development and commercialisation of new products to address
unmet patient needs and grow the business is a fundamental part
of strategy.

Progress made in the year

Enhanced by the launch of LiquiBand® XL, sales of new products
increased to 15.4% (2021: 12.8%) LiquiBand® XL growth and the
imminent launches of LiquiBandFix8® in the US and Seal-G®
are expected to contribute further in the near-term.

Employee attrition %

Employee Engagement Score %

13%

2022

2021

2020

2019

2018

13%

10%

12%

84%

2022

2021

2020

2019

2018

84%

76%

78%

48%

41%

Definition
The % of employees who have left the Group during the year
(gross number of leavers).

Strategic linkage
Reasonable levels of employee turnover are important for the future
success of the business and to help to embed its’ culture. It can be
considered beneficial, supporting new ideas and to introduce best
practices from outside the Group.

Progress made in the year
AMS continues to attract quality talent to meet its growing needs.
We did see increased attrition of 13% (2021: 10%) due to the impacts
of global labour shortages and higher labour mobility driven by post-
COVID working practices. We expect continuing increased employee
engagement and communication to keep attrition manageable.

Definition
Of the employees who responded to the Employee Survey, the % of
employees who had seen positive action from the implementation
of our Care, Fair, Dare culture.

Strategic linkage
How successfully we have embedded our culture. An increasing score
indicates more engaged employees, leading to more productivity and
happiness, leading to higher retention.

Progress made in the year
The engagement score in 2022 increased to 84% (2021: 76%).
Participation in the survey increased to 74% (2021: 69%), providing
a broader range of employees views. In 2022 we used Culture Amp
software to benchmark our engagement with other companies.
Based on the external benchmark our engagement score for
neutral or positive employees increased to 87% (2021: 83%).

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Surgical

Group performance
The Group delivered record sales of £124.3 million driven
by good commercial progress from both Business Units.

Surgical Business Unit
The Surgical Business Unit includes tissue adhesives, sutures,
biosurgical devices and internal fixation devices marketed
under the AMS brands LiquiBand®, RESORBA®, LiquiBandFix8®
and Seal-G®.

Growth in the Surgical Business Unit was driven by strong
performances from the Biosurgical Devices and Internal
Fixation products. Revenue increased by 16% in the period to
£74.9 million (2021: £64.6 million) and by 12% on a constant
currency basis.

Surgical Business Unit

Advanced Closure
Internal Fixation
and Sealants
Other Distributed
Traditional Closure
Biosurgical Devices

TOTAL

2022
£ million

2021
£ million

Reported
Growth

Change
at
constant
currency

36.0

33.1

4.1
2.9
16.0
15.8

74.9

2.6
0.0
14.9
14.0

64.6

60%
-
7%
13%

16%

60%
-
6%
13%

12%

Advanced Closure
LiquiBand® is a range of topical skin adhesives, incorporating
medical-grade cyanoacrylate in combination with purpose-
built applicators. These products are used to close and
protect a broad variety of surgical and traumatic wounds.

Advanced Closure

Americas
UK/Germany
Rest of World

TOTAL

2022
£ million

2021
£ million

Reported
Growth

23.4
7.3
5.3

36.0

22.4
6.3
4.5

33.1

5%
17%
19%

Change at
constant
currency

-6%
17%
17%

Revenues increased to £36.0 million (2021: £33.1 million)
representing growth of 9% on a reported basis and 1%
on a constant currency basis.

Strong growth in LiquiBand® globally was partially offset
by weakness in US revenues and consequently US sales
increased by only 5% at reported currency and declined
by 6% at constant currency.

In 2022, the Group began a strategic review of its US LiquiBand®
business which involves assessing and streamlining its routes
to market and product offering in order to help drive stronger
growth in this key market sector. As part of this initiative, we
identified and first made contact with Connexicon as a potential
acquisition target. We intend to complete this strategic review
process during 2023 and it is expected that this will result in
improved market access and growth potential from H2 2023.
As a consequence of the ongoing changes, we had reduced
orders from one partner in H2 2022 and this is expected to
continue throughout H1 2023.

Following its approval in H1 2022, LiquiBand® XL delivered a
strong launch in H2 2022, with £0.6 million of initial US orders
fulfilled, strengthening our optimism in the short and long-
term potential of LiquiBand® XL in the fast-growing $60 million
long wound market and unlocking further growth potential for
the LiquiBand® business. The US approval is to be extended in
early 2023 with the addition of a product that can close wounds
up to 60cm rather than the current maximum of 40cm.

Going forward, we remain highly confident of delivering growth
with LiquiBand® in the US, especially as we start to reap the
benefits of adding LiquiBand® XL and the recently acquired
Connexicon Medical products to our portfolio.

The acquisition of Connexicon Medical in February 2023 brings
an existing Indermil® Flexifuse® business in Europe and APAC,
progress towards accessing the large Chinese market and an

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Traditional Closure
RESORBA® branded Absorbable and Non-absorbable Suture
ranges are used in general surgery and a wide range of surgical
specialties including dental and ophthalmic surgery. Revenue
increased by 7% to £16.0 million and by 6% at constant currency
(2021: £14.9 million).

This portfolio has been established in predominantly European
markets. However, in line with the Group’s ongoing strategy
to expand the geographic reach of existing products, recent
successes in the US dental market made a significant contribution
to Traditional Closure revenues during the period.

Biosurgical Devices
The Biosurgical Devices category comprises antibiotic-loaded
collagen sponges, collagen membranes and cones, oxidised
cellulose, synthetic bone substitutes and bio-absorbable screws.
Revenues increased by 13% at reported and constant currency
to £15.8 million (2021: £14.0 million).

Demand for collagens both with and without antibiotics
continued to drive growth in Europe in 2022, including
an increased focus on the cardiovascular market with a
supplementary brand and a new specialist partner network.
AMS’s strategy to expand its distribution network into new
territories has also been working well, with particular success in
the Far East where one of its distributors was the first to exceed
annual collagen revenues of £0.5 million.

The Group continues to work towards its first collagen approval
in the US with a 510(k) submission expected in 2023 for a dental
application to support haemostasis and healing following
tooth extraction.

The RESORBA® branded bone substitutes range has shown
a promising start following its launch in 2021, rolling out in a
number of European countries during 2022. The Group continues
to work towards a bone substitute pilot launch into the US in
mid-2023, using independent reps..

Other Distributed Products
Following the acquisition of AFS, the Other Distributed
category comprises products distributed by AFS, including
minimally invasive access ports and laparoscopic instruments.
This category excludes sales of LiquiBandFix8® which are
recorded within the Internal Fixation and Sealants category.
Since acquisition, AFS performance has been in-line
with expectations.

Below:

Surgical product range

exciting, enhanced portfolio for the US market that provides
significant commercial synergies, with approvals expected by
early 2024. The addition of Connexicon’s highly experienced
R&D team to the Group has provided AMS with a medical
adhesive development hub in Dublin, strengthening the
Company’s ability to develop and launch innovative
adhesive and sealant technologies in the coming years.

Outside the US market, the LiquiBand® brand continued to
perform very strongly, with underlying growth of 17% in the
UK/Germany and the Rest of the World markets. AMS is
encouraged to see early-stage traction building for LiquiBand®
XL outside the US, and this is now contributing to growth.

In addition, the Group has recently taken over the direct
ownership and distribution of InteguSeal®, a cyanoacrylate
microbial surgical sealant that has the potential to deliver sales
significantly above the low levels historically achieved by our
partner. AMS is now looking at options for broader global
distribution that have the potential to generate more
meaningful revenue. The first direct order was shipped to
a new partner in Japan in late 2022 and there is significant
business development activity planned in other key EU and
APAC markets in early 2023.

Internal Fixation and Sealants
LiquiBandFix8® uses individual, accurately delivered drops
of cyanoacrylate adhesive inside the body, to fix hernia
meshes in place, instead of sutures or tacks.

A strong performance from LiquiBandFix8® was supported
by the UK National Institute for Clinical Excellence (NICE)
recommendation and the AFS acquisition as revenues
increased to record levels of £4.1 million (2021: £2.6 million)
an increase of 60% at reported and constant currency. The
marketing expertise from AFS will be beneficial to other
marketing teams and will help to increase traction in
more specialist minimally invasive surgical markets.

In October 2022, AMS reported that the Premarket Approval
(PMA) for LiquiBandFix8® had been submitted and accepted
by the FDA. Since then, FDA engagement has been high and
the process is progressing well with approval on track for
H2 2023 with an anticipated launch in 2024.

Seal-G® MIST (laparoscopic surgery) and Seal-G® (open
surgery) are novel, internal, biological sealants used to seal
tissue during gastrointestinal surgery to reduce bleeding and
leakage of fluid. The trial continues to progress well with over
80% of the 160 procedures now complete, with results on
track for H1 2023 and launch planned for H2 2023.

Key Opinion Leader feedback continues to be highly positive
and AMS remains excited about the opportunity for Seal-G®
products in answering a high unmet patient need for an
effective GI sealant. Beyond colon surgery, the Company sees
opportunities to drive demand in surgeries with other potential
indications that experience high leakage rates, for example
oesophageal and pancreatic surgery. In early 2023, we
received our first end-user commercial order from a UK
surgeon who is using SEAL-G® in oesophageal surgery
to reduce the risk of leaks.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

O Pe rA T I N G r e vIe w
w oUnDcA Re B U Si n eS S Un i t

Infection Management
The Infection Management category
comprises Advanced Woundcare dressings
that incorporate antimicrobials such as Silver and
Polyhexamethylene Biguanide (PHMB). Revenue
increased by 7% on a reported basis and by 2%
on a constant currency basis to £16.1 million
(2021: £15.1 million).

The Group’s growth in the infection
management market continues to be affected
by reimbursement issues in a number of
territories, driving greater use of standard
dressings over higher priced anti-microbial
alternatives. However, orders for AMS’s silver
alginate range have now stabilised following
the renegotiation of a major contract in 2022
and progress continues to be made through new
distribution channels. Other new products, such
as the Silver High Performance Dressing and
Silicone PHMB foam range continue to be
rolled out and help to sustain growth.

New product approvals in this area are becoming
increasingly challenging and we are currently
reviewing FDA questions on the 510(k) for our
innovative high-gelling product with anti-biofilm
activity that was submitted in 2022. On a more
positive note, we expect to obtain extended
US approval for our Silicone PHMB foam
range in H1 2023.

This dressing provides high efficacy and sustained
performance, and the enhanced antimicrobial
approval increases its potential to penetrate
the US, MEA and APAC regions.

Exudate Management
Exudate Management comprises Advanced
Woundcare dressings, gels and bulk materials
which do not incorporate any antimicrobial
elements. Revenue increased by 8% on a reported
basis and by 7% on a constant currency basis to
£23.4 million (2021: £21.7 million).

woundcare

Woundcare Business Unit
The Woundcare Business Unit is comprised
of the Group’s multi-product portfolio of
Advanced Woundcare dressings sold under
its partners’ brands and the ActivHeal® label,
plus a portfolio of specialist medical bulk
materials including multi-layer woundcare
and bio diagnostics products.

The Woundcare portfolio growth was driven by
increased orders from OEM partners, growth in
ActivHeal®, bulk materials and royalties as well
as increased pricing to recover inflationary cost
increases. Revenue increased by 13% to £49.5
million (2021: £44.0 million) and by 8% on a
constant currency basis.

Woundcare
Business Unit

2022
£ million

2021
£ million

Reported
Growth

Change
at
constant
currency

Infection
Management
Exudate
Management
Other
Woundcare

16.1

15.1

23.4

21.7

9.9

7.2

TOTAL

49.5

44.0

38%

13%

26%

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Below:
ActivHeal® AquaFibre Extra, part of our woundcare dressing range

Increased orders from the Group’s OEM partners
continued to drive Exudate Management growth
with a significant increase in demand for our
specialist medical foam material.

Growth has also been driven by the successful
implementation of the Group’s strategy to expand
the distribution network for its own ActivHeal®
range of dressings. AMS has continued to appoint
new ActivHeal® distribution partners in markets
where its key partners have no or low presence,
but the demand for a high-quality, cost-effective
woundcare dressing range still exists. Several
new contracts were signed in 2022, with
launches being undertaken as market
registrations are obtained.

AMS has applied its biosurgical, collagen
technology into developing a tissue scaffold
designed to treat hard-to-heal and stalled
wounds such as diabetic foot ulcers and venous
leg ulcers. A 510(k) submission was made in the
period and we are reviewing FDA questions
as we continue to evaluate the optimal
commercial strategy.

Progress continues to be made in the
development of a customer-specific negative
pressure dressing. The 510(k) submission has
been made by our partner and AMS awaits
confirmation of approval and commercialisation.

Other Woundcare
Other Woundcare comprises royalties, fees
and woundcare sealants. Revenue increased
by 38% at reported currency and by 26% at
constant currency to £9.9 million (2021: £7.2
million) due to increased partner demand for
membranes, gels and hydrocolloid and a higher
royalty income from the Group’s licensing
arrangement with Organogenesis.

Non-Financial Reporting Statement
This Annual Report contains the information required to comply with the
Companies, Partnerships and Groups (and Non-Financial Reporting)
Regulations 2016, as contained in sections 414CA and 414CB of the
Companies Act 2006. The table below provides key references to
information that, taken together, comprises the Non-Financial
Reporting Statement for 2021.

Reporting
requirement

Group Policies that
guide our approach

Information and risk management,
with page references

Environmental
matters

– Environmental Policy

– Ethical Sourcing Policy

– ESG Policy

Employees and
social matters

– Equality, Diversity

and Inclusion Policy

– Community Support

– Health and Safety Policy

– Environmental Policy

– Ethical Sourcing Policy

Reporting environmental
impact/SECR disclosures
– pages 38 and 39

Our Business Model –
pages 6 and 7

Risk Management –
pages 43 to 47

Reporting on our
environmental impact –
pages 38 and 39

Our Business Model –
pages 6 and 7

Risk Management –
pages 43 to 47

Stakeholder Engagement –
pages 23 to 27

Our Strategy –
pages 14 to 17

Respect for
human rights

– Anti-Slavery Policy

– Ethical Sourcing Policy

– Modern Slavery Act Policy

Corporate Governance
Report – pages 52 to 57

Anti-corruption
and anti-bribery
matters

– Anti-Bribery Policy

– Gift Policy

– Sanctions Policy

– Whistleblowing Policy

– Ethical Sourcing Policy

Audit Committee Report –
pages 61 to 64

Risk Management –
pages 43 to 47

Description of the business model

Description of the principal risks in relation
to the above matters, including business
relationships, products and services likely
to affect those areas of risk, and how
we manage the risks

Our Business Model –
pages 6 and 7

Risk Management –
pages 43 to 47

Non-financial key performance indicators

Key Performance Indicators
– pages 18 and 19

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S 1 7 2 ( St A KeHo lDeR e n gA

g e m e n t)

engagement

AMS considers its stakeholders as integral to its
success and is committed to actively engaging
and collaborating with them throughout the
value chain. This engagement with our core
stakeholders ensures that their views inform our
business strategy, enabling us to understand
their priorities, and use their feedback to
shape our business. We summarise below, and
reference throughout this Annual Report, how
our Directors engagement with stakeholders on
key decisions also fulfils their duties in relation
to Section 172 of the Companies Act 2006.

Our stakeholders
Listening, engaging and partnering with our
stakeholders, illustrated in the diagram below
and further explained on pages 25 to 26, helps
us to address our business impacts and improve
the outcomes for those different groups.

Advanced Medical Solutions Group plc Annual Report & Accounts 2022

Section 172
The Directors, as required by Section 172 of
the Companies Act 2006, must act in the way
they consider, in good faith, would most likely
promote the success of the Company for the
benefit of its stakeholders. In so doing, the
Directors must have regards, amongst other
matters, to the:

Likely consequences of any decision

in the long-term.

Interests of the Company’s

employees.

Need to foster the Company’s business
relationships with suppliers, customers
and others.

Impact of the Company’s actions on the

community and environment.

Desirability of the Company maintaining

a reputation for high standards of
business conduct.

Need to act fairly between members

of the Company.

ers
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C h a i n

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Employee

Board of
Directors

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Employees

Patients

Investors

Clinicians

We are a people-centric,
equal-opportunity business
which aims to enable our
employees to develop and
thrive whilst protecting
their safety and wellbeing.

The patient is at the heart
of everything we do. We
develop innovative products
to minimise complications
and improve patient
outcomes.

We give high priority to
communicating effectively
with investors, brokers
and analysts on strategy,
governance and financial
forecasts.

We work with Clinicians
and Key Opinion Leaders
to ensure our products
are effective, easy to use,
clinically safe and meet
patient needs.

MATERIAL TOPICS

• Financial and operational

• Clinical Advisory Boards

• Increased Employee

Engagement

• Opportunities to share ideas

• Financial support during the

• Products to address unmet
patient needs and improve
their outcomes

performance

• Business strategy and

• Post-market surveillance

acquisitions

cost-of-living crisis

• Clinical studies

• Opportunities for career

• Monitor trends and changes

development

• Flexible working

• Market conditions

• R&D pipeline and
product approvals

• Dividend

• Industry-leading training

• Subscription database

• Virtual symposia

HOW WE ENGAGE

Our CEO Live global webcasts
enable employees to freely
raise questions. Questions
can also be asked though
a SMT Portal. Employee
Inclusion Groups can be
approached regarding issues
at site-level. An annual
Employee Engagement
Survey provides an
opportunity to give feedback
anonymously. The Company
newsletter enables employees
to be updated by colleagues
from across the Group. To
protect our lower earners
during the cost-of-living crisis
we are providing additional
financial support. We have
appointed a Board Director
to be responsible for
Workforce Engagement.

We work closely with
customers, clinicians, Key
Opinion Leaders and industry
bodies to understand patient
needs. We are investing in
clinical studies which enable
the commercialisation of
products to address unmet
needs, such as Seal-G® and
our US LiquibandFIX8®
Pre-Market Approval.

We maintain regular
communications with
shareholders, analysts
and brokers in line with
our regulatory duties. We
have twice-yearly results
roadshows and engage on an
ad-hoc basis on issues such
as remuneration, governance
and ESG. We hold an Annual
General meeting and provide
updates in between via RNS
alerts our website and contact
through our advisors.

Clinical Advisory Boards
help to provide guidance
and clinical trial development
for key products.

We have a focus on training
and education with ActivHeal®
Academy and other digital
platforms, including increased
social media engagement.

For key surgical products we
conduct virtual symposia and
Voice of Customer activities.
We provide clinical updates
to surgeons on products
to increase skill levels.

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g e m e n t)

Regulators

We engage with Competent
Authorities and Notified
Bodies to operate within
regulatory and legal
frameworks and ensure our
products have approval
in key markets.

Communities
& Environment
Our values encourage us
to contribute to our local
communities and charitable
causes, reduce our
environmental impact
and help to stop climate
change. These are key
components of our
ESG framework.

Partners

Supply Chain

Our network of OEM and
distribution partners allow
us to meet the clinical needs
of patients that we cannot
reach directly.

We strengthen our supply
chain resilience through
increased inventory levels,
robust supply agreements,
minimising sole suppliers,
a comprehensive supplier
audit programme and
monitoring compliance with
our Ethical Sourcing Policy.

MATERIAL TOPICS

• Compliance with legislation

• Pathway to Net Zero

• Relationship development

• Supply chain resilience

• Maintain high standards

• Involvement in local

• Education and training

• Medical Devices Regulation

(MDR)

organisations

• Sponsorship

• Working relationships with

• Environmental initiatives

Notified Bodies

• Customer discussions on
environmental impact
and emissions

• Opportunities to share ideas

• Align pipeline of

new products, value-
added services and
customer support

through increased inventory
levels and dual sourcing

• Security of supply

• Maintaining OTIF

• Impact of cost inflation

• Auditing of suppliers
including plan to
incorporate ethical matters

HOW WE ENGAGE

In a highly regulated
industry we maintain
good relationships with
our regulators by working
openly and in a transparent
way, promoting a partnership
approach to further
understand the
regulatory landscape.

Actively engaging in local
communities by encouraging
employees to participate.
Provide sponsorship and
charity matching where
employees are involved locally.
Environmental pledge
programme and ISO50001 at
selected sites help to reduce
our local environmental
impact and we take part in
environmental initiatives
local to our sites.

We try to ensure that partners
have the opportunity to speak
to key employees at any time.
We use remote ‘Voice of
Customer’, Key Opinion
Leader masterclasses and
focus groups to gain feedback
on products and ideas.
Websites, online tools and
Brand Hubs provide further
direct engagement. We
participate in Industry
clinician groups.

We hold regular meetings
with key suppliers and have
strengthened our key supplier
audit process, making
it more robust and building
closer working relationships.
Further information is provided
in the Principal Decision on
Supply Chain on page 27.

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Principal decisions in 2022

The Board considered the interests of, and the impact
on, all stakeholders when key decisions were made
during the year, as demonstrated below.

PRINCIPAL DECISION 1
Implementation of a ‘Pathway to Net Zero’

In 2022 extensive Board discussion led to a decision to
work with an external consultant to implement a ‘Pathway
to Net Zero’. In line with our commitment to reduce our
environmental burden, we decided to:

OUTCOME AND IMPACT ON LONG-TERM
SUSTAINABLE SUCCESS OF GROUP

The Board believe the ESG Framework provides a good
building block to further develop our ESG targets. Our
Pathway to Net Zero is a critical part of that Framework
and developing this over the coming years will increase
employee engagement, attract employees with our values
and make us an attractive proposition for investors, in
particular those looking for environmentally conscious
companies, making us a good corporate citizen
which acts in line with market and best practice.

• Assess our Scope 3 emissions, up and down the supply
chain, and to review where we can reduce all emissions.

• Establish a process to move towards Net Zero via the

PRINCIPAL DECISION 2
Build the resilience of our Supply Chain

feasibility assessment outlined above and report to the
Board on resource required to drive AMS’s long-term
sustainability.

The Board made the decision to prioritise the resilience of
the Supply Chain in 2022. This was driven by global supply
chain conditions.

• Set site-based targets to support our ambitions and

promote how AMS can help and play a part in keeping
global warming potential under the Science-Based
Target of 1.5C.

STAKEHOLDERS CONSIDERATIONS

• Investors – from previous discussions we were already
aware that investors had an appetite for us to further
expand our ESG work and commit to reducing our
impact on the environment.

It was agreed that the best approach was to proactively
manage the supply chain; actions included increasing
inventory levels and dual sourcing of key raw materials
where feasible. Maintaining supply of product to our
customers is critical for positive patient outcomes, as
switching supplier can be challenging in highly regulated
markets. We further strengthened our key supplier audit
programme and are implementing ESG as part of the
audit process.

• Employees – we engaged with our employees and

STAKEHOLDERS CONSIDERATIONS

obtained their views through our ESG Steering
Committee, local ESG Champions and Employee
Engagement process. Pathway to Net Zero was seen
as a significant issue for new and existing employees.

• Customers and Partners– we are receiving significantly
increasing ESG expectations from across our customer
base, both from the public sector (NHS) and large
customers. The NHS requires suppliers to work towards
a Pathway to Net Zero and our large and OEM Partners
have requested details on progress in this area, either
through meetings or providing details of our plans.

• Communities and Environment – as a significant
employer who has looked to engage more closely
in the local communities in which we operate and
to protect our local environments, developing a
‘Pathway to Net Zero’ will help us with this goal.

• Patients- we considered it to be of upmost importance

that patients continued to have access to our woundcare
and surgical devices.

• Customers and Partners– continuation of supply was

considered a key factor for our customers and partners
so that they could maintain their market position.

• Investors – we engaged with investors to explain the
rationale of planned inventory increases and cash
and working capital impact.

OUTCOME AND IMPACT ON LONG-TERM
SUSTAINABLE SUCCESS OF GROUP

The outcome of this work was that our supply chain
remained highly resilient despite the challenges we
faced. These challenges resulted in minimal impact on
our customers and we maintained a high-level of OTIF.
This has been positively received by our customers
and strengthened our relationships and allowed us to
continue to supply our customers, partners, clinicians
and patients.

We also managed to deliver gross 4% cost reduction
projects across the Group to partially offset cost inflation.
Our programme of MDR approvals has continued to
progress well and will move forward as planned, despite the
extension to the deadlines. This work has made us better
prepared for future challenges and developed relationships
for when we engage with suppliers regarding ESG in the
coming year.

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Reducing our
environmental
footprint

In 2022 we began our ‘Pathway to Net Zero’ project and further
integrated our ESG Framework.

A
M
S

Our contribution to the United Nations
Sustainable Development Goals (SDGs)
These areas where our business can have the
most meaningful impact:

Our ESG Framework is based on our 4 Ps
(Planet, People, Product, Policy). It focuses
on key commitments that are meaningful and
aligned to our Mission, Vision and Strategy, and
considers our contribution to the United Nations
SDGs. It is supported by Increased resources,
improved organisational focus, environmental
responsibility and a Net Zero ambition.

VIR

POLICY

PLANET

VER N

O
G

PRODUCT

PEOPLE

For more information see page 31

SOCIA L

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ESG Framework

Environment

Social

Governance

Planet

Principles

• Minimise any negative

impact on the
environment.

• Uphold the highest

standards of corporate
responsibility.

Stakeholder engagement

• Communities and

Environment.

• Supply Chain.

• Investors.

Commitments

• Minimise negative

environmental impact,
combat climate change.

• Manage energy use more
efficiently and increase
renewable and sustainable
resources.

• Reduce waste, protect

water, improve recycling,
re-use materials.

• Expand scope of
ISO Certification.

• Promote Environmental

Pledge Scheme.

ESG metrics

• Pathway to reduce

emissions, scope 3 plan.
• CO2e emissions per £k

sales (KG).

• Gas usage, water,
electricity (total,
by person).

• Waste (landfill).

People

Product

Policy

• Having a positive impact

on the local communities
in which we operate.

• Offer our employees a

safe, supportive working
environment with a
positive culture.

• Operate in an ethical

and responsible manner.

• Contribute to society by
developing products to
improve patient outcomes.

• Uphold the highest

standards of corporate
governance.

• Build and develop an

ESG reporting framework
with meaningful targets.

• Patients, Partners,

Clinicians.

• Employees.

• Regulators.

• Supply Chain.

• Investors.

• Partners.

• Employees.

• Attract, retain and develop

our talent to support
future growth.

• Promote equality, diversity

and inclusion.

• Support employees on

health, safety and all forms
of wellbeing, including
Employee Assistance
Programme (EAP) and
mental wellness app.

• Provide financial support
for employees’ charity
work, chosen charities and
community volunteering.

• Uphold ethical standards
across our value chain.

• Work with patients,

partners and clinicians
to identify unmet needs.

• Uphold external standards
to protect human rights.

• Zero tolerance towards

bribery, corruption
and fraud.

• Improve transition of early
stage R&D, reduce waste.

• Robust data governance

and compliance.

• Manufacture products
focused on quality,
customer safety, welfare.

• Ensure equal pay

regardless of gender,
ethnicity or disability.

• Transition to recyclable

• Enrol in UN Global

packaging, apply
regulations and
certification.

Compact, embed Ten
Principles across business.

• Charitable donations.

• Number of new products

• Reported cases of bribery,

• YOY Health & Safety score.

• Employee Engagement

score.

• Training and

development spend.

• Participation in Employee

Share Plan.

released per year.

• % new products released
with recyclable packaging.

• Product safety rates

in market.

• % suppliers signed up to

Supplier Charter.

corruption or fraud.

• Whistleblowing reports.

UN Sustainable Development Goals

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ESG Principles

minimise any negative
impact on the
environment

operate in an ethical
and responsible
manner

offer our employees
a safe, supportive
working environment
with a positive
culture

Have a positive
impact on the local
communities in which
we operate

contribute to society
by developing
products to improve
patient outcomes

Uphold the highest
standards of corporate
governance and
responsibility

ensure that eSg is
at the heart of our
business

Build and develop
an eSg reporting
framework with
meaningful targets

ESG Governance and Integration

Board level consideration of ESG

• Covered in Board Agenda with regular updates

• Consideration on risks and opportunities

The Board delegates ESG matters to Committees

g
n
m
r
o
f
n
I

ESG Steering
Committee

• ESG strategy
& implementation

• Disclosure
& compliance

Remuneration
Committee

• ESG targets as part of
incentives (Personal
objectives in 2022)

Audit
Committee

• Risk management

• Financial statements

Senior
Management Team

• Operational
responsibility

ESG Champions

• Dissemination of information and raise issues

• Drives sustainability and communicate ESG priorities

• Enable ESG actions to be implemented at local level

• Ensure each site understands what is expected

Operation Management

• Implement initiatives, policies & share best practice while meeting site level targets

• Raise issues directly with management

Operations:

g
n
i
t
r
o
p
e
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UN Sustainability Development Goals

The SDGs which we consider to be most relevant to AMS are:

UN Goal

How AMS contributes

ensure healthy lives and
promote wellbeing for
all at all ages

• Improve patient outcomes.

Other key ESG activities

• Focus on employees (mental,

wellbeing, flexible working and
Employee Assistance Programme.

ensure gender equality and
empower all women and girls

• Ensure equal opportunities during

recruitment and promotion.

• Equality, Diversity and
Inclusion programme.

ensure inclusive and equitable
quality education and promote
lifelong learning opportunities
for all

• Work closely with clinicians and
partners investing in industry
leading training and education.

Promote innovative and
sustainable economic growth,
full and productive employment
and decent work for all

• Ensure employees are engaged,

skilled and motivated.

• Pay living wage and support

lower earners.

ensure sustainable consumption
and production patterns

• Ensure all products meet highest
standards of quality, safety and
efficiency, and are ethically sourced.

Take urgent action to
combat climate change
and its impacts

• Committed to reduce our carbon
footprint, reduce waste and utilise
renewable energy, where possible.

Modern Slavery Act
AMS takes its responsibility
to protect human rights very
seriously. We do not tolerate
slavery or human trafficking
either internally or in our supply
chain. We will never knowingly
deal with any organisation
which is connected to slavery
or human trafficking.

Our full compliance statement
can be found on the company
website www.admedsol.com

Gender Pay Gap Reporting –
Ensuring Opportunities for All
AMS believes in being an
inclusive and diverse employer.

We remain confident that
employees are paid equally for
doing equivalent jobs, and have
opportunities for development
and advancement.

Our latest report under the Gender
Pay Gap Regulations is available
on the company website
www.admedsol.com

cASe StUDY
Reducing our environmental impact
In 2022 our Plymouth site undertook a project to add 430m2 of space for production, development and quality purposes. In-line with
local planning requirements, and to futureproof the expansion, AMS undertook biodiversity assessments, reviewed building methods
and considered waste and other potential impacts within the building process. We have ensured that the extension has structural
stability to further expand our solar array at Plymouth in the near future.

This building project took nine months to complete and there were no injuries during construction, as well as no environmental
complaints, environmental losses or leaks. Biodiversity management achievements included:

• No adverse reptile or animal

events recorded.

• Rewilding of land with natural scrub and
wildflowers along eastern boundary.

• Log piles to promote a diverse range of
wildlife including hedgehogs, toads,
spiders and other small mammals.

• Bird and bat boxes added to existing
trees to further attract these species
to the area.

95.3
MWh generated (from solar)
2021: 68.7MWh)

21%
of site electricity (from solar)
2021: 19% (extension not included)

Find out more on our website
www.admedsol.com

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

eNvIr O N MeN T A L ,
S O C I A L A N D G O v e r N A N Ce (c o n t i nUeD )

ESG Project – Pathway to Net Zero

In 2022, we commenced work on our Pathway to Net Zero with an external consultant. We are currently working through
a Net Zero project timeline (see below) with data collections, emission calculations and three site surveys completed.

In order to be able to provide a complete picture of the
impact of our entire supply chain, in addition to measuring
emissions from our own operations and electricity
consumption (Scope 1 and 2), we have estimated the
greenhouse gas (GHG) emissions associated with all
upstream and downstream activities (Scope 3).

Scope 3 emissions are indirect emissions not under
our direct control and often account for 80%-99%
of a company’s emissions footprint. Assessing these
emissions can help to focus reduction activities.
Collaboration and business choices can help
to reduce these emissions.

2022

2023

Nov

Dec

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

GHG emissions
footprint

Data collection

emissions
calculations

carbon Balance Sheet

Year 2 Data
collection

Year 2
emissions
calculations

Applicability Review Session

Net-zero strategy
development

net-Zero workshop

net-zero strategy
development

net-zero report review meeting

net-zero Strategy

Energy site surveys

Site Surveys

Science-based
Target Validation

target discussion

target submission

n Inspired Plc Tasks n AMS Tasks ◆ Deliverable l Meeting

Advanced Medical Solutions Group plc Annual Report & Accounts 2022

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In 2021 we produced 47,352 tonnes carbon
dioxide equivalent (tCO2e) Scope 3 emissions
connected to our entire global operations.
These emissions account for 94% of our
total greenhouse gas emissions footprint.

All emissions have been calculated following
the GHG Protocol’s Corporate Accounting and
Reporting Standard and the guidelines of the
ISO14064-1. All applicable Scope 3 categories
have been quantified. Each greenhouse gas has a
different global warming potential (GWP) compared
to carbon dioxide (CO2) eg Methane (CH4) has
a warming potential 28 times that of CO2.

Upstream and downstream transport and
distribution, paid for by us and our customer's
respectively, also produce significant Scope 3
emissions. A better understanding of the transport
mode used for products, and moving towards
lower carbon transport routes, will help us to
reduce emissions.

Going forward, our Scope 3 emissions will be
addressed through engagement with suppliers,
customers and internal engagement. We are
in the process of producing a decarbonisation
action plan which will detail the short, medium
and long-term actions we will take to meet
near-term and Net Zero targets.

Emissions Scope and Scope 3 Category

Scope 1

Gas

Transport (Excluding Grey Fleet)

Other Fuels

F-Gas

Scope 2 (location-based)

Scope 3

1. Purchased Goods and Services

2. Capital goods

3. Fuel-related emissions

4. Upstream Transportation and Distribution

5. Waste generated in operations

6. Business travel

7. Employee commuting

8. Upstream leased assets

9. Downstream Transportation and Distribution

10. Processing of sold products

“January 2021 -
December 2021
GHG Emissions (tCO2e)”

1,716

889

249

145

433

1,352

47,352

19,060

6,130

705

5,377

326

214

825

Not Applicable

4,779

9,751

11. Use of sold products

Not Applicable

12. End of life treatment of sold products

13. Downstream leased assets

14. Franchises

15. Investments

Total All Scopes (location-based)

125

Not Applicable

50,431

ESG Project – ISO Certification
We achieved International Organization of Standardisation
(ISO) standards around energy management (ISO
50001:2018) and environmental management (ISO
14001:2015) at four key manufacturing locations.

Our internal management systems have been validated
to confirm that we are meeting the requirements on
environmental protection and energy management
and reduction. In 2023 we will continue to develop
and refine our systems.

ESG Project – TCFD Reporting
In 2023 we will prepare our disclosures for the Task Force
on Climate-Related Financial Disclosures (TCFD). These
requirements are based around Governance, Strategy, Risk
Management and Metrics and Targets. We must consider
how these core areas fit into our Business Model and
assess how we manage climate related risks.

We measure performance against ESG metrics which will form
the basis of our reporting and help to develop a strategy for
managing climate related risks. Our current reporting can be
adapted to meet TCFD requirements, engaging our supply
chain and utilising data on Green House Gas emissions
(GHG) and carbon footprint. TCFD will complement
our commitment to reduce our environmental impact.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

eNvIr O N MeN T A L ,
S O C I A L A N D G O v e r N A N Ce (c o n t i nUeD )

planet

We are committed to minimising any negative
impact on the environment and upholding the
highest standards of corporate responsibility.

Highlights

Continued development of energy and climate change action plans.

Eliminated F-gas losses (see page 39) and waste to landfill through
better waste handling processes and waste contractor engagement..

ISO Certification at four key sites and principles rolled out across
the Group to reduce energy use and environmental impact.

Work progressing with external consultant on a Pathway to Net Zero.

Adoption of electric car lease scheme that UK employees can elect
to join. Site company cars all either hybrid or electric.

Review of potential future impact of TCFD commenced (H1 2022).

Comparative energy usage fell despite increased production.

Commenced roll out of more in-depth recycling processes and
significantly upgraded recycling capabilities at our Winsford site.

Embedded Environmental Pledge Scheme across the Group to
encourage employees to reduce their own carbon footprint.

Looking forward
• Make full use of the expanded data to more proactively forecast

energy use and increase environmental awareness.

• Refine internal targets and embed management of climate change
risk (renewable energy target: 70% by 2025). Renewable energy
targets are increasingly challenging due to reduced availability
and providers withdrawing from the market, resulting in our
mix reducing from 51% to 39%.

• Continued focus on waste management processes.

• Further embed role of ‘ESG Champions’ for local and global

awareness, initiatives and support.

• Review implementation of ISO 14001 and ISO 50001 certification

across the Group and plan for certification at other sites.

• Further promote Environmental Pledge Scheme and expand

impact measurement.

Advanced Medical Solutions Group plc Annual Report & Accounts 2022

Emissions per £k sales

19.51 CO2e

Scope 1 (direct)/Scope 2 (indirect) emissions intensity
(2021: 27.45 CO2e per £k sales)

38 m³/employee

total water usage (2021: 53m³)

waste to landfill (2021: 2.2%)

0.92 tons/employee

total waste (2021: 1.25 tons/employee)

2,268,009 kg CO2e

Scope 1 and 2 emissions (2021: 2,838,419 CO2e)

46%

renewable/low carbon energy mix
(including nuclear) (2021: 51%)

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people

We are committed to having a positive impact
on the local communities in which we operate
and offering our employees a safe, supportive
working environment with a positive culture.

Highlights
Progressed actions from the employee engagement survey in
2021 resulted in more positive results in the 2022 survey.

Increased donations to £47k for charitable and community
activities through product and monetary donations (2021: £30k).

Executive bonus scheme increased focus on personal objectives
and included progress in ESG as a specific goal.

Looking forward
• Complete EDI/unconscious bias training across the Group, in

particular in recruitment (commenced in 2022; finish in H1 2023).

• Continuous review of our benefits proposition.

• Increase training and development budget to develop key staff.

• Promote expanded Employee Assistance Programme (EAP) and

actions to improve access to support for mental wellbeing.

• Increase frequency of company-wide EHS events including annual
EHS day, site ‘EHS focus events’ and World Health & Safety Day to
help reduce an increased accident and LTI rate in 2022.

• Focus on building approach to charitable giving and engagement

by development of communities strategy.

• Expand work and profile of Altogether AMS, our Diversity and

Inclusion Programme, and EDI Committee. Implement annual plan.

Employee gender diversity

Male

Female

Board

17%

Senior Management
Team

Employees

43%

55%

74%

employee engagement survey
response rate (2021: 69%)

87%

positive or neutral responses based
on the external benchmark of our
Engagement Score¹ (2021: 83%)

reported incident of discrimination (2021: 1)

21%

invested in the Employee Share Plan
(2021: 20%)

3.3

H&S (AMS Accident Incident Rate) (2021: 2.7)

Lost Time Incidents (LTIs >7days) (2021: 0)

83%

57%

45%

As defined by the Culture Amp software.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

eNvIr O N MeN T A L ,
S O C I A L A N D G O v e r N A N Ce (c o n t i nUeD )

product

We are committed to contributing
to society by developing products
to improve patient outcomes.

Highlights
Significant progress in key R&D projects to meet unmet
patient needs (LiquiBandFIX8® PMA for US distribution and
Seal-G® and Seal-G® MIST – see page 9).

Further development of strategic approach to technology
and innovation aligned to business growth plans.

Supply chain resilience and contingency planning
throughout challenging economic conditions.

Assessed plans to implement strict standards of
sustainable sourcing.

Engaged customers and suppliers regarding ESG data
on products and processes.

Looking forward
• Further develop collaboration strategies with academia

and research institutes.

• Introduce ESG criteria when auditing key suppliers.

• Roll-out Code of Conduct for suppliers to ensure
enhanced customer requirements are embedded
within the supply chain.

• Increasing focus on process efficiency and product

quality innovation.

• Continued investigation and assessment of alternative
raw material supplies to further strengthen security
of supply and supply chain resilience.

• Review considerations for health care economics to
consider the best ways to distribute product in an
ethical way to meet ethical needs.

• Continued focus on responsible and sustainable sourcing

of raw materials.

£12.3m

dedicated investment in R&D
(2021: £9.3m)

9.9%

of revenue spend on R&D
and innovation (2021: 8.6%)

new products released in 2022
(2021: 3)

98%

of key1 materials suppliers met with,
visited and/or audited in the past year
(2021: 94%)

deaths caused in the market
by AMS products (2021: 0)

$10.6 billion

potential total annual achievable market
estimation (see pages 12 to 13 for more
information) (2021: $10.6bn)

Advanced Medical Solutions Group plc Annual Report & Accounts 2022

1 Ranked critical, crucial or major.

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policy

We are committed to operating in an ethical
and responsible manner, upholding the highest
standards of corporate governance and to
building and developing an ESG reporting
framework with meaningful targets.

0 fines

and non-monetary sanctions from non-
compliance with environmental laws and/or
regulations (2021: 0)

Highlights
Continued adherence to the UK Corporate Governance Code
(see pages 52 to 57).

Appointment to the Board of Liz Shanahan as
a Non-Executive Director.

Updated and revised Annual Compliance training on data
protection, modern slavery and the policies listed below:

• Anti-Bribery, Anti-Money Laundering,

Anti-Facilitation of Tax Evasion, Competition Law.

• Whistleblowing.

• Market Abuse, Gifts and Hospitality.

ESG Steering Committee Meetings
held during 2022 (2021: 1)

1st

formal annual ESG Report completed

0 incidents

• Health and Safety, and Environmental and Energy policies.

of bribery, corruption or fraud (2021: 0 incidents)

ESG Steering Committee embedded with regular
Group-wide reporting.

ISO 50001 and ISO 14001 action plan implemented at key sites.

Formally signed up to the UN Global Compact which commits
us to standards on Human Rights, Labour Standards, Environment
and Anti-Corruption.

Looking forward
• Sustainability and ESG related policy development.

• Further embedding of ISO 50001 and 14001 standards

and expansion of Best Practice to other sites.

• Assessment of current processes and performance reporting

to external, best practice benchmarks.

• Compliance training refreshed for Group-wide training.

• Development of a formal Code of Conduct for all employees.

• Continued integration of acquisitions to ensure all policies are
adopted, including two acquisitions in 2022 and early 2023.

• Ensure TCFD reporting meets reporting standard.

whistleblowing reports (2021: 0)

£0

spend on political campaigns, lobbying or think
tanks (2021: £0)

reported incidents of human rights violations
in our supply chain (2021: 0)

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

eNvIr O N MeN T A L ,
S O C I A L A N D G O v e r N A N Ce (c o n t i nUeD )

Becoming a more sustainable business.
Environmental Review of 2022
We are required to comply with the Companies (Directors’
Report) and Limited Liability Partnerships (Energy & Carbon
Report) Regulations, 2018, this covers Streamlined Energy
and Carbon Reporting (SECR). In 2019, we measured our
environmental impact in line with the SECR requirements
to develop our base line results. These baseline results
determined our base year figures to our most current
reporting period.

Our 2022 report showed improvements through reduction
in overall Carbon Dioxide Equivalent (CO2e) emissions to
the atmosphere in both of our intensity ratios and helped
to shape our objectives for 2023.

Our high-level findings for 2022 are presented below.

total AmS emissions per year (tco2e)

Environmental Impact
In 2022 AMS emitted 2,425 TCO2e into the atmosphere, a
decrease from 2021 (2,981 TCO2e). This reduction has been
driven by significant investment in air handling and cooling/
heating systems and site controlled activities to reduce utility
usage and preserve natural resources.

total Scope 1,2 & 3 (tco2e)

2022

2021

2020

2019

2,425.31

2,981.22

1,899.00

2,797.16

e
2
O
C
T

3,500

3,000

2,500

2,000

1,500

1,000

500

2022

20211

20202

Environmental Development
In 2022 we committed to investing time and resources into
becoming both increasing our sustainability and becoming
more carbon efficient We utilised our Environmental Policy to
drive decisions, gaining further commitment from our Board
to continue to develop and progress our environmental plans
and objectives.

As part of our commitments outlined on page 29 we have now
been fully certificated against the International Standards (ISO)
for Energy and Environmental Management (ISO 14001:2015
and ISO 50001:2018) and are proud of our achievements in
attaining these certifications. In 2023 we will continue refining,
developing and reducing our impact on the environment and
reduce our reliance on natural energy resources.

2022 targets

No breaches of environmental
permits or consents

Policy adoption (Environmental/
Energy Management)

Implementation of ISO 14001
and ISO 50001 across the Group

✔ Achieved

Feasibility studies of energy
saving activities

Launch of Environmental
Pledge programme

✔ Partially achieved

✔ Achieved

In conjunction with
ESG Champions
divested est 3 tonnes
TCO2e

Future development
In-line with our ESG framework and commitment to reduce
our environmental burden, in 2023 AMS will further develop
our approach to sustainability by:

• Continue to progress work with our chosen partner to

review where we can reduce our Scope 1 and 2 emissions
and implement engagement programmes to reduce our
Scope 3 emissions, both up and down the supply chain.

• Using the Carbon Balance Sheet developed with Inspired

Energy, engage with key stakeholders on our short,
medium and long-term environmental goals and
our ambitions around a Net Zero operating model.

• Set site-based targets to support our ambitions and promote

how we can play a part in the circular economy, reduce
reliance on natural resources and work towards keeping
global warming under the Science-Based Target of 1.5C.

During 2022 we received a significant number of requests
from our stakeholders for environmental and ESG related data.
In 2023 we will continue to engage with our stakeholders to
build on these relationships, share our plans and undertake
activities that support our projects, focusing on reducing our
emissions, minimising use of natural resources and reducing
risk to habitats, including resource scarcity.

Advanced Medical Solutions Group plc Annual Report & Accounts 2022

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Our reporting
Our emissions reporting represents all core business operations
within scope of our Consolidated Financial Statements. Primary
data from energy suppliers has been used wherever possible.

Following the Companies (Directors’ Report) and Limited
Liability Partnerships (Energy & Carbon Report) Regulations,
2018 and to meet out SECR reporting requirements, we report
within AMS’ report the following recognised scopes.

These scopes are listed within ISO 14064-1, which
describes the principles, concepts and methods relating
to the quantification and reporting of direct and indirect
greenhouse gas (GHG) emissions for an organisation.

Scope 1 – All Direct Emissions from the activities of an
organisation or under their control, including fuel combustion
such as gas boilers, fleet vehicles and air-conditioning leaks.

Scope 2 – Indirect Emissions from electricity purchased
and used by the organisation. Emissions created during the
production of the energy eventually used by the organisation.

Scope 3 – All Other Emissions from activities of the organisation,
occurring from sources that they do not own or control.

Our calculations are based on records we hold and use
location-based emissions in compliance with the factors
published by BEIS/ DEFRA in June 2022. We report all our
Scope 1 and Scope 2 emissions. Following a commitment
in 2019, we report some elements of Scope 3.

The table below covers the total emissions from AMS activities
for all locations in 2022, it also offers a comparison to both
2021 and our base year data 2020.

Emissions type/scope
Total Scope 1 (kg CO2e)
Natural gas (kg CO2e)

Gas oil (kg CO2e)

Yearly comparison (kg CO2e)

2022

20211

20202

Commentary

1,272,869 1,726,938

565,517

996411

899,415

104,794 Gas emissions based on usage in all but one

geographical location.

33,626

145,425

143,456 Emissions through use of oil powered heating

and supply system in one AMS location.

AMS Company cars (kg CO2e)

242,832

248,891

172,504 Emissions generated from AMS owned vehicles,

this is combined petrol, diesel, hybrid and electric
emissions.

F-gas losses (kg CO2e)

433,207

144,763 Emissions captured through F-gas loses across

Total Scope 2 (kg CO2e)
Location based electricity (kg CO2e)

Total Scope 3 (kg CO2e)
Electricity, transmission and
distribution loss (kg CO2e)
Water in (kg CO2e)

995,141 1,111,481 1,310,640

AMS systems.

995,141

1,111,481 1,310,640 Electricity emissions based on use in each

geographical location.

157,301

142,798

22,838

91,033

97,136

N/A Not captured before 2021 covers loses within

network and usage.

5,009

4,501

10,799 Water delivered to AMS locations for all types of

Private business miles (kg CO2e)

40,997

19,751

use ranging from manufacturing processes to
sanitary use.

N/A Not captured before 2021, covers business miles
completed in privately owned vehicles, based on
the definition of a medium sized car powered by
petrol, diesel, hybrid or electric.

Waste processing, all types (kg CO2e)

20,262

19,130

12,039 Emissions generated through waste processing

Total Scope 1, 2 & 3 (kg CO2e)
Intensity measure – COGS (£K)
(kg CO2e)
Intensity measure – Eaches (kg CO2e)
Intensity measure – Percentage of
waste to landfill (% T)

Intensity measure – Renewable/low
carbon energy mix (including nuclear)

Renewable energy mix
(excluding nuclear)

1 Raleigh included for first time in 2021.

2 COVID-19 impacted year.

based on types of waste generated, both recycled
and non recyclable.

2,425,311 2,981,217 1,898,995

19.51

27.45

22.23 kg CO2e emissions per £ of sales.

0.08

0.03

2.2

51%

0.02 kg CO2e emissions per unit (eaches) produced.
N/A Percentage of waste that cannot be recycled
or further processed, but has to go to landfill.

42% Percentage of Electricity supplied to locations
from renewable sources (inc Nuclear).

22%

30%

35%

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

F I N A N C I A L r e vIe w

Eddie Johnson,
Chief Financial
Officer

Resilient financial
performance in
challenging global
economic conditions

Advanced Medical Solutions Group plc Annual Report & Accounts 2022

SUMMArY
IFRS reporting
To provide the clearest possible insight into
our performance, the Group uses alternative
performance measures. These measures are
not defined in International Financial Reporting
Standards (IFRS) and, therefore, are considered
to be non-GAAP (Generally Accepted Accounting
Principles) measures. Accordingly, the relevant IFRS
measures are also presented where appropriate.
AMS uses such measures consistently at the
half-year and full-year and reconciles them
as appropriate. The measures used in this
statement include constant currency revenue
growth, adjusted operating margin, adjusted
profit before tax and adjusted earnings per share,
allowing the impacts of exchange rate volatility,
exceptional items, amortisation, and the movement
in long-term acquisition liabilities to be separately
identified. Net cash is an additional non-GAAP
measure used.

Overview
Revenue increased by 14% at reported currency
and 10% at constant currency to £124.3 million
(2021: £108.6 million).

Gross margin improved to 59.0% (2021: 56.2%)
as increased volumes drove improved
operational leverage.

Administration expenses increased to £47.4 million
(2021: £37.0 million) due to the addition of AFS
expenses, higher regulatory and R&D investment,
increased selling and marketing activity and a
significant adverse foreign exchange movement.

The Group incurred £12.3 million of gross
R&D spend in the period (2021: £9.3 million),
representing 9.9% of sales (2021: 8.6%), reflecting
increased investment in innovation and in meeting
the increasing regulatory standards. As shown in
the table below, part of this cost is capitalised
and amortised over the following 5 to 10 years.

Total investment
in Research and
Development,
Regulatory and Clinical

Of which:
Charged to the profit
and loss account

Capitalised, to be
amortised over
5-10 years

2022
£’000

2021
£’000

12,301

9,343

6,149

5,310

6,152

4,033

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Net operating
cash flow

£26.9m
-13%

Net cash

£82.3m
+13%

Adjusted1 profit
before tax

£28.5m
+11%

Amortisation of acquired intangible assets increased
to £3.4 million in 2022 (2021: £3.2 million) due
to the acquisition of AFS in March 2022.

In the period, a credit of £0.8 million (2021:
£0.4 million debit) was recorded in relation to
movements in the long-term liabilities relating
to deferred consideration and earnout from
the Sealantis and AFS acquisitions.

Adjusted profit before tax, which excludes
amortisation of acquired intangibles and
movements in long-term liabilities recognised
on acquisition, increased by 11% to £28.5 million
(2021: £25.6 million) whilst the adjusted PBT margin
decreased by 70 bps to 22.9% (2021: 23.6%) due
to cost inflation having an adverse impact on
the Group’s profit margin.

Reported profit before tax was £25.9 million
(2021: £22.0 million).

Reconciliation of profit before tax
to adjusted profit before tax

2022
£’000

2021
£’000

Profit before tax

25,910

21,984

Amortisation of
acquired intangibles
Movement in long-term
acquisition liabilities

Adjusted profit
before tax

3,414

3,179

(840)

426

28,484

25,589

The Group’s effective corporation tax rate,
reflecting the blended tax rates in the countries
where we operate and including UK Patent Box
Relief, increased slightly to 21.2% (2021: 20.5%).
The UK Government’s enactment of a 25% tax
rate from April 2023 will result in an increased
Group effective tax rate from FY2023.

1 Adjusted profit before tax is shown before amortisation of acquired
intangible assets which was £3.4 million (2021: £3.2 million) and
the movement in long-term liabilities recognised on acquisitions
which was a credit of £0.8 million (2021: £0.4 million debit) and
exceptional items which were £nil (2021: £nil), as reconciled in
the Financial Review (see pages 40 to 42).

Adjusted diluted earnings per share increased by
8% to 10.47p (2021: 9.66p) and diluted earnings
per share increased by 16% to 9.30p (2021: 8.01p),
reflecting the Group’s increased earnings.

Reflecting its confidence in the Group’s
prospects, the Board is proposing an increased
final dividend of 1.51p per share, to be paid on
9 June 2023 to shareholders on the register
at the close of business on 19 May 2023. This
follows the interim dividend of 0.64p per share
paid on 22 October 2022 and would, if approved,
make a total dividend for the year of 2.15p per
share (2021: 1.95p) an increase of 10%.

Operating result by business segment

Year ended
31 December 2022
Revenue
Segment
operating profit
Amortisation of
acquired intangibles
Adjusted segment
operating profit4
Adjusted
operating margin4

Year ended
31 December 2021
Revenue
Segment
operating profit
Amortisation of
acquired intangibles
Adjusted segment
operating profit4

Adjusted
operating margin4

Surgical
£’000

Woundcare
£’000

74,861

49,469

19,333

6,687

2,469

945

21,802

7,632

29.1%

15.4%

64,630

43,971

18,298

5,420

2,005

1,174

20,303

6,594

31.4%

15.0%

Note 4: Adjusted for amortisation of acquired intangible assets

Table is reconciled to statutory information in Note 4 of the
Financial Statements.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

F I N A N C I A L r e vIe w CO N T I N U E D

Surgical
Surgical revenues increased by 16% to £74.9 million
(2021: £64.6 million) at reported currency and by
11.6% at constant currency. Adjusted operating
margin decreased by 230 bps to 29.1% (2021:
31.4%) due to lower shipments of LiquiBand®
to US partners, the addition of AFS with a
lower operating margin and the adverse
margin impact of inflation.

Woundcare
Woundcare revenues increased by 13% to
£49.5 million (2021: £44.0 million) at reported
currency and increased 8.4% at constant currency.
Adjusted operating margin increased by 40 bps
to 15.4% (2021: 15.0%) as a favourable sales
pricing mix was offset by the adverse margin
impact of inflation.

Currency
The Group hedges significant currency transaction
exposure by using forward contracts and aims
to hedge approximately 80% of its estimated
transactional exposure for the next 18 months.
In the financial year, approximately one third of
sales were invoiced in Euros and approximately
30% were invoiced in US Dollars.

The Group estimates that a 10% movement in
the £:US$ or £: € exchange rate will impact
Sterling revenues by approximately 3.1% and
3.0% respectively and, in the absence of any
hedging, this would have an impact on the
Group operating margin of 2.5% and 0.3%
percentage points respectively.

Cash flow
The Group continued to generate significant
amounts of cash from operations. Net cash
inflow from operating activities in the period was
£26.9 million, which was lower than 2021 (£31.0
million) due to increased investment in inventory
to mitigate the supply chain crisis and to mitigate
any potential risks relating to the transition to MDR.

At the end of the period, the Group had net cash of
£82.3 million (31 December 2021: £73.0 million)
inclusive of the acquisition of AFS.

Working capital increased during the year.
Increased inventory and receivables were only
partially offset by increased payables. Inventory
cover increased to 6.2 months of supply (2021:
4.9 months) due to planned increases in stock
levels. Debtor days and creditor days have both
remained broadly consistent with prior period
at 44 days (2021: 44 days) and 37 days (2021:
37 days) respectively.

Capital investment in equipment, R&D and
regulatory costs increased to £9.9 million (2021:
£6.5 million) as the Group continues to invest in
its future pipeline.

Cash outflow relating to taxation decreased to
£3.3 million (2021: £4.1 million) due to the
timing of payments on account.

The Group paid its final dividend for the year
ended 31 December 2021 of £3.0 million in June
2022 (2021: for the year ending December 2020,
£2.6 million in June 2021), and its interim dividend
for the six months ended 30 June 2022 of £1.4
million in October 2022 (for the six months ended
30 June 2021: £1.2 million in October 2021).

The Group retains strong support from its two
banks, NatWest and HSBC, and in order to retain
maximum flexibility of facility size for future
acquisitions, it did not renew its credit facility
when it expired in December 2022.

Eddie Johnson
Chief Financial Officer

Advanced Medical Solutions Group plc Annual Report & Accounts 2022

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F i nAn c i Al S t At e m e n t S

r I S K M A N A GeMeN T

We continuously review and
mitigate historical risks as well
as new emerging risks

operating in the post-coviD current environment, impacted by the
war in Ukraine, we continue to embed a rigorous and disciplined
approach to risk management across our business. we believe that
identification and mitigation of key risks will support the success
and sustainability of AmS in the short, medium and long-term.

We believe that the policies, procedures
and monitoring systems that are in place are
sufficient to effectively manage the risks faced
by our business.

The Board has applied principles 28 and 29 of the
2018 UK Corporate Governance Code (Code) by
establishing a continuous process for identifying,
evaluating and managing the significant risks
the Group faces, as outlined on page 46, and
for determining the nature and extent of the
significant risks it is willing to take in achieving
our strategic objectives.

Risk and uncertainty are an inherent part
of doing business which could impact our
business, brands, assets, revenue, profits, liquidity
and capital resources. To meet our strategic
objectives, build shareholder value and promote
our stakeholders’ interests, we must manage risk.

An effective and successful risk management
process balances risk and reward and is
dependent on the judgement of the likelihood
and impact of the risk involved. The Board has
overall responsibility for ensuring there is an
effective risk management framework, which
underpins our business model.

The Business Units, Senior Management Team
(SMT), Audit Committee and Board review risks
throughout the year. These risks are documented
in the Risk Register which is formally reviewed
by the SMT and Board at least twice annually.
The plans and actions assigned to the Executive
Directors and SMT members are reviewed to
ensure progress is being made with risk
actions and mitigation plans.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

r I S K M A N A GeMeN T CO N T I N U E D

A robust methodology is used to identify key risks across
the Group. This is a continuous process carried out in
accordance with the relevant provisions set out in
the UK Corporate Governance Code.

Identifying risks
A robust methodology is used to identify key risks
across the Group; in Business Units, operations
and during projects. This is an ongoing process,
and is carried out in accordance with the relevant
provisions set out in the Code.

Analysing risks
Once identified, the process will evaluate identified
risks to establish root causes, financial and non-
financial impacts and likelihood of occurrence. We
use a scoring system to assess the likelihood of a risk
materialising and the potential financial impact on
the Group. The risks are prioritised in terms of
severity based on the scoring and a mitigation plan
is prepared to reduce the risk. Once controls and
mitigating factors are considered, the risk is
reassessed and rescored (mitigated score) to
ascertain the net exposure.

Managing risk
The SMT and the Board review the Risk Register
formally at least twice a year, assessing whether
the risks are still the most significant facing the
Group and whether new risks have arisen or been
identified. Effectiveness, adequacy of controls
and mitigating actions are assessed, and if
additional controls or actions are required,
these are identified and actions assigned.
The Risk Register documents this.

Monitoring and reporting risk
The SMT is responsible for monitoring progress to
mitigate key risks. The risk management process
is continuous; key risks and risk mitigation plans
and progress are reported to and reviewed by
the Board, following the SMT’s review of the
Group’s Risk Register.

Internal Audit
Additionally, the Board is supported by a
programme of Internal Audits. Internal Audit
reports to the Audit Committee on the progress
of controls or process improvements following
Internal Audit recommendations.

Identif y
Identify ris k
ss existin g c

e
s
s
A

r o l s

a
l
y

Assess mitig
Score m
iti

r
e

r
i
s

r
s

Risk
Management
Process

i
t

ution

d Report

n responsibilit
p action pla
M a nage

e l o

A s s i g
D e

Emerging risks
Emerging risks are newly developing risks that cannot
yet be fully assessed but that could, in the future, affect
the viability of our strategy. We identify these risks by
encouraging the reporting of potential risks up the
organisation and discussing them openly in a specific
SMT Risk Review. We discuss whether critical
assumptions underlying the strategy are becoming,
or have become, invalid. Risks are then either managed
within the organisation or elevated to the Risk Register
for further discussion by the Board.

Advanced Medical Solutions Group plc Annual Report & Accounts 2022

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R
e
p
o
r
t
i
n
g

Key roles and responsibilities

Implementation and compliance responsibility

Board

Audit
Committee

Senior Management
Team

Business Units and
Other Functions

• Overall responsibility for

corporate strategy,
governance, performance,
internal controls and risk
management.

• Identification, review and
management of identified
Group strategic risks.

• Defining risk appetite.

• Assessing the effectiveness
of the risk management
processes adopted across
the Group.

• Challenging the content

of the Risk Register.

• Assessing the effectiveness
of the risk management
processes adopted across
the Group.

• Ensuring compliance with
financial and reporting
legislation, rules and
regulations and ensuring
the Annual Report is fair
and balanced.

• Monitoring compliance with
internal control systems and
co-ordinating Internal Audit.

• Monitoring and oversight of
Internal and External Audit.

• Management of the business and

• Execution of actions

delivery of strategy.

associated with managing risk.

• Identification and monitoring of the
key risk indicators, taking action.

• Ensuring implementation of the
Group’s actions and mitigation
plans required to manage risk.

• Challenging the appropriateness

and adequacy of plans to
mitigate risk.

• Analysing the aggregation of

risk across the Group.

• Provision of cross-functional

resource to effectively mitigate risk.

• Timely reporting on the

implementation and progress
of agreed action plans.

• Identification and reporting of

strategic risks to the SMT.

• Implementation of a risk
management approach
which promotes the ongoing
identification, evaluation,
prioritisation, mitigation and
monitoring of operational risk.

Monitoring and reporting responsibility

g
n
m
r
o
f
n
I

Risk heat map – Principal risks
While we continue to monitor and manage a wider range of risks, the risk
heat map summarises those risks considered to have the greatest potential
impact if they were to materialise.

Financial

Strategic

Trend (net position of
risk vs 2021):

1 Lack of growth

2 Poor ROI from R&D

3 Acquisitions/integration

4 Delivery against forecast

5 Supply chain/cost inflation

6 Regulatory

7 Single source supply

8 Cyber-risk

9 Talent management

–

Increase from 2021

Static since 2021

–

Decrease from 2021

Emerging risk

Likelihood

Risk Size

Operational

High

Low

Large Medium Small

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

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Strategic linkage to risks

G Growth I Innovation O Operational Excellence C Culture

Potential impact

Key controls and mitigating factors

Status

• Income shortfall.
• Market capitalisation

impacted.

• Reduced profit.
• Loss of competitive

advantage.

• Loss of key partners.
• Cost increase.

• Development and launch of new products to secure existing

and new customers and drive future growth.

• Making accretive synergistic acquisitions to help fuel growth.
• Diversified approach reduces the impact on any one project,

partner or product.

• Contract minimas which allow agreements to be
renegotiated or terminated for poor performance.

• Evaluation of opportunities to broaden reach into new

markets or adjacent sectors.

• Ongoing evaluation of incoming technologies for licensing.
• Full-service offering including strong regulatory and quality

assurance, product development, product differentiation and
clinical support to mitigate a pure cost of supply proposition.

• Income shortfall.
• Market capitalisation

• Focusing on unmet needs and large market opportunities.
• Pipeline of new products/technologies identified to provide

impacted.

growth and differentiation.

Strong pipeline
and well positioned
for growth.
Strategic review
of US LiquiBand®
had a short-term
negative impact

No change

• Unique products protected by IP and enforcement.
• Improved front-end business planning process.
• Effective alignment of strategy to consider market
changes and promote quality and cost savings.

• Marketing strategy to support partners and products.
• Processes to ensure R&D projects progress to plan.
• Strong links with partners, including universities,

to reduce the risk of missed opportunities.

• Investment in clinical research, personnel, symposia,
and Key Opinion Leaders to foster new approaches.

• Utilise licensing and outsourcing options.

• Loss of reputation
as an innovator.
• Loss of competitive

advantage.

• Loss of key partners.
• Loss of market share.
• Misidentification of
new, competitive
technologies.

• Commercial value
of products not
maximised.

• Impairment of assets.

• Impact on Group
performance and
market capitalisation.

• Reputational loss.

• Strategy set, M&A objectives defined and advisors appointed.
• Detailed market intelligence and identification of targets.
• Extensive due diligence process established.
• Integration plan in place with key milestones.
• Internal resource being added to improve target mapping.

No change

Potential impact

Key controls and mitigating factors

Status

• Loss of income.
• Increased costs.
• Shortfall in profit.
• Market expectations

missed.

• Market capitalisation

impacted.

• Regular dialogue with investors, advisors and analysts.
• Robust annual budget process, SMT and Board reviews

and monthly pragmatic bottom-up reforecasting.
• Monthly demand review and SOP process evolved to

ensure crossfunctional alignment, content and process.

No change

Strategic risks
Risk

1
Lack of growth

2
Poor return
on investment
from R&D

G I

3
Making the
wrong or no
acquisition/poor
integration

G O

Financial risks
Risk

4
Delivering against
forecast –
internal accuracy

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Strategic linkage to risks

G Growth I Innovation O Operational Excellence C Culture

operational risks
Risk

Potential impact

Key controls and mitigating factors

Status

5
Supply chain/
cost inflation

6
Regulatory risk

• Inability to

supply product.
• Loss of income.
• Shortfall in profit.
• Market expectations

missed.

• Proactive management of supply chain.
• Improved forecasting and forward planning.
• Regular communication and forward-ordering with suppliers.
• Contractual rights enforced with customers to minimise impact.
• Recovery of cost inflation from customers during annual

contract negotiations.

No change

• Inability to supply

product.

• Product approvals

and launches delayed.
• Loss of product claims.
• Loss of reputation.

• Stringent regulatory regime with an experienced team.
• Regulatory strategy and additional resource to manage

MDR assigned and ringfenced.

• Strong regulatory pathway to gain approvals.
• Work with partners and distributors to utilise local expertise.
• Strictly controlled Quality Management System.

MDR extension
to 2027/28

7
Vulnerability to
single source
supply

• Inability to supply
specific products.
• Increased cost of

supply and exposure
to cost increases.

• Dual source key components wherever possible.
• Strong Vendor Risk Assessment process.
• Forward ordering and holding inventory prevent

operational issues.

• Business Interruption Insurance in place.
• Working closely with suppliers and increasing audits.

8
Cyber-risk

9
Talent
management

I O C

• Systems and data
compromised.
• Financial loss.
• Business interruption.
• Loss of reputation.

• Loss of key staff.
• Insufficient talent

pool for succession
planning.

• Market conditions
result in difficulty
filling open roles.

• Implementation of audit and testing recommendations.
• IT administrator access levels tightened.
• Increased segregation of duties.
• Cyber Security training for all employees.
• Engaged consultants and achieved Cyber

Essential Certification.

• Succession and talent management processes.
• Developed a grade system to improve career paths.
• Integrated total reward, performance and culture strategy
to drive attraction, retention and employee engagement.
• Introduced changes to long-term working arrangements.
• Increased employee engagement.

No change

Higher attrition
and increased
acceptance of
remote working

The Strategic Report has been prepared solely to provide information for shareholders to assess how the Directors have
performed their duty to promote the success of the Group and contains forward-looking statements. These statements
are made by the Directors in good faith based on the information available to them up to the approval of this report and such
statements should be treated with caution due to the inherent uncertainties, including both economic and business risk factors,
underlying any such forward-looking information. The Group Strategic Report, which encompasses pages 6 to 47 was approved
by the Board of Directors and signed on its behalf by:

Eddie Johnson
Chief Financial Officer
18 April 2023

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

B O Ar D O F D Ir eC T OrS

Committee
membership key
A Audit Committee

R Remuneration Committee

N Nomination Committee

Committee Chair

Biography

Peter Allen
Non-Executive Chair

Chris Meredith
Chief Executive Officer

Eddie Johnson
Chief Financial Officer

Peter Allen has extensive
experience in the healthcare
industry, having held key
senior positions in a number
of companies and played
a significant role in their
development. This includes
12 years at Celltech Group plc
(1992-2004) as CFO and
Deputy CEO, six years as Chair
(2007-2013) of ProStrakan
Group plc (Interim CEO
2010-11), three years as Chair of
Proximagen Neurosciences plc
(2009-12), five years as
Non-Executive Chair of Diurnal
plc (2015-2020), nine years as
Non-Executive Chair of Clinigen
plc (2012-2021) and 11 years as
a Non-Executive Director and
Non-Executive Chair of Oxford
Nanopore Technologies plc
(2011-2022).

Chris Meredith joined AMS as
Group Commercial Director in
July 2005 following a successful
18-year career in international
healthcare sales, marketing
and business development.
His experience covered
business-to business contract
manufacturing, product
development and clinical
research, as well as branded
product sales all within the
medical device, pharmaceutical
or consumer healthcare markets.
Chris has previously held senior
positions at Smiths Industries,
Cardinal Health, Banner
Pharmacaps, and Aster Cephac.
He was appointed Managing
Director of Advanced
Woundcare in February 2008,
became Chief Operating Officer
in January 2010 and was
appointed as Chief Executive
Officer in January 2011.

Eddie Johnson was appointed as
Chief Financial Officer in January
2019. He joined AMS in October
2011 and was appointed Group
Financial Controller in November
2012. Prior to this he gained a
first-class degree in Maths and
Computer Science from Keele
University in 1993 and qualified
as a Chartered Accountant
in 1996.

Since moving into industry in
1996 Eddie has held a number
of senior finance roles in various
sectors including, more recently,
Head of Commercial Finance
at Norcros plc and Western
European Financial Controller
for Sumitomo Electrical
Wiring Systems.

term of office

Peter Allen was appointed
as Non-Executive Chair of
the Group in January 2014.

Chris Meredith was appointed
to the Board in April 2006.

Eddie Johnson was appointed
to the Board in January 2019.

Grahame Cook was appointed

Douglas Le Fort was appointed

Liz Shanahan was appointed

as Non-Executive Director of

as Non-Executive Director

AMS in February 2021.

AMS in August 2021.

of AMS in August 2022.

external
appointments

Peter Allen is currently
the Non-Executive Chair of
Nasdaq-listed Abcam plc. He is
also a Non-Executive Director of
Istesso Limited, and a qualified
Chartered Accountant.

None.

Chris Meredith was
appointed Chair of Arterius,
a UK-based pre-commercial,
non-competitive medical device
company, in January 2022. He
left his role as a Non-Executive
Director of Creavo Medical
Technology Ltd in
November 2021.

Advanced Medical Solutions Group plc Annual Report & Accounts 2022

Grahame Cook

Senior Independent

Non-Executive Director

Douglas Le Fort

Non-Executive Director

Liz Shanahan

Non-Executive Director

Grahame Cook has 18 years’

Douglas Le Fort is a seasoned

Liz Shanahan is a life sciences

experience in investment

banking focusing on global

veteran in the medical and life

entrepreneur with extensive

science industry, with more than

experience advising leading

equity capital markets and M&A

20 years of senior executive

global pharmaceutical and

and corporate advisory services.

leadership. He has expertise in

healthcare organisations on

He was a Managing Director at

business strategy, including

their communications. Most

UBS and joint Chief Executive of

commercial business execution,

recently, she was a Non-

Panmure Gordon. He advised

operational management and

Executive Director of UDG

the London Stock Exchange on

M&A. Most recently, he was

Healthcare plc, a company that

the creation of TechMark, the

CEO of MedTrade Products, a

was listed on the London Stock

specialist segment of the Main

woundcare products business,

Exchange and a constituent of

Market focusing on innovative

and prior to that served in

the FTSE 250 up until its £2.8

technology and healthcare

various senior executive roles at

billion takeover in August 2021.

companies. He has experience

ConvaTec Group plc, including

Until 2014, she was Global Head

in the healthcare sector, most

five years on the Executive

of Healthcare & Lifesciences at

recently as Chair of Sinclair

Pharma plc and as Non-

Executive Director of

Committee for the Group.

At ConvaTec he was Senior

the NYSE-listed management

consultancy, FTI Consulting

Vice President for Corporate

Inc., which in 2007 acquired the

Morphogenesis Inc and Horizon

Development, and prior to that

communications business Santé

Discovery plc. He has also held

Vice President and General

Communications, founded by

Board positions in a number of

Manager with P&L responsibility

Liz in 1995. Liz is a Trustee of

other companies including MDY

for the global Ostomy business.

CW, the charitable arm of

Healthcare plc and Crawford

Healthcare.

He has an MBA from Henley

Management College and is

He holds a double first-class

a Chartered Management

degree from Oxford University

Accountant.

and is a member of the Institute

of Chartered Accountants.

Chelsea & Westminster

Foundation Trust Hospital in

London and a member of the

organisation’s Innovations

Advisory Board.

Alongside her Board

appointments she is a business

advisor and Executive coach.

Grahame Cook is Chair

of Molten plc, a FTSE 250

Douglas Le Fort is currently an

Liz Shanahan is currently

Operating Partner for Revival

a Non-Executive Director

Company, and a Non-Executive

Healthcare Capital Partners, an

of Inspiration Healthcare

Director of Minoan plc and

Sapience Communications

Limited.

investor in medical device and

Group plc and Celadon

diagnostics businesses, as well as

Pharmaceuticals plc (previously

a Non-Executive Director at Trio

Summerway Capital plc), both

Healthcare, a manufacturer of

of which are AIM-listed.

ostomy products, Clinisupplies,

a UK-based manufacturer of

chronic care products and “The

Insides” Company Ltd, a start-up

addressing intestinal failure

based in New Zealand.

o v e R v i e w

S t R At e g i c R e p oR t

G O v e rN A N Ce

F i nAn c i Al S t At e m e n t S

Peter Allen

Non-Executive Chair

Chris Meredith

Chief Executive Officer

Eddie Johnson

Chief Financial Officer

Biography

Peter Allen has extensive

Chris Meredith joined AMS as

Eddie Johnson was appointed as

experience in the healthcare

Group Commercial Director in

Chief Financial Officer in January

industry, having held key

July 2005 following a successful

2019. He joined AMS in October

senior positions in a number

18-year career in international

2011 and was appointed Group

of companies and played

a significant role in their

healthcare sales, marketing

and business development.

development. This includes

His experience covered

Financial Controller in November

2012. Prior to this he gained a

first-class degree in Maths and

12 years at Celltech Group plc

business-to business contract

Computer Science from Keele

(1992-2004) as CFO and

manufacturing, product

University in 1993 and qualified

Deputy CEO, six years as Chair

development and clinical

as a Chartered Accountant

(2007-2013) of ProStrakan

Group plc (Interim CEO

research, as well as branded

product sales all within the

in 1996.

2010-11), three years as Chair of

medical device, pharmaceutical

Proximagen Neurosciences plc

or consumer healthcare markets.

(2009-12), five years as

Chris has previously held senior

Non-Executive Chair of Diurnal

positions at Smiths Industries,

plc (2015-2020), nine years as

Cardinal Health, Banner

Non-Executive Chair of Clinigen

Pharmacaps, and Aster Cephac.

plc (2012-2021) and 11 years as

He was appointed Managing

a Non-Executive Director and

Director of Advanced

Non-Executive Chair of Oxford

Woundcare in February 2008,

Nanopore Technologies plc

became Chief Operating Officer

(2011-2022).

in January 2010 and was

appointed as Chief Executive

Officer in January 2011.

Since moving into industry in

1996 Eddie has held a number

of senior finance roles in various

sectors including, more recently,

Head of Commercial Finance

at Norcros plc and Western

European Financial Controller

for Sumitomo Electrical

Wiring Systems.

NRA

Grahame Cook
Senior Independent
Non-Executive Director

Douglas Le Fort
Non-Executive Director

Liz Shanahan
Non-Executive Director

Grahame Cook has 18 years’
experience in investment
banking focusing on global
equity capital markets and M&A
and corporate advisory services.
He was a Managing Director at
UBS and joint Chief Executive of
Panmure Gordon. He advised
the London Stock Exchange on
the creation of TechMark, the
specialist segment of the Main
Market focusing on innovative
technology and healthcare
companies. He has experience
in the healthcare sector, most
recently as Chair of Sinclair
Pharma plc and as Non-
Executive Director of
Morphogenesis Inc and Horizon
Discovery plc. He has also held
Board positions in a number of
other companies including MDY
Healthcare plc and Crawford
Healthcare.

He holds a double first-class
degree from Oxford University
and is a member of the Institute
of Chartered Accountants.

Douglas Le Fort is a seasoned
veteran in the medical and life
science industry, with more than
20 years of senior executive
leadership. He has expertise in
business strategy, including
commercial business execution,
operational management and
M&A. Most recently, he was
CEO of MedTrade Products, a
woundcare products business,
and prior to that served in
various senior executive roles at
ConvaTec Group plc, including
five years on the Executive
Committee for the Group.
At ConvaTec he was Senior
Vice President for Corporate
Development, and prior to that
Vice President and General
Manager with P&L responsibility
for the global Ostomy business.

He has an MBA from Henley
Management College and is
a Chartered Management
Accountant.

Liz Shanahan is a life sciences
entrepreneur with extensive
experience advising leading
global pharmaceutical and
healthcare organisations on
their communications. Most
recently, she was a Non-
Executive Director of UDG
Healthcare plc, a company that
was listed on the London Stock
Exchange and a constituent of
the FTSE 250 up until its £2.8
billion takeover in August 2021.
Until 2014, she was Global Head
of Healthcare & Lifesciences at
the NYSE-listed management
consultancy, FTI Consulting
Inc., which in 2007 acquired the
communications business Santé
Communications, founded by
Liz in 1995. Liz is a Trustee of
CW, the charitable arm of
Chelsea & Westminster
Foundation Trust Hospital in
London and a member of the
organisation’s Innovations
Advisory Board.

Alongside her Board
appointments she is a business
advisor and Executive coach.

term of office

Peter Allen was appointed

as Non-Executive Chair of

the Group in January 2014.

Chris Meredith was appointed

Eddie Johnson was appointed

to the Board in April 2006.

to the Board in January 2019.

Grahame Cook was appointed
as Non-Executive Director of
AMS in February 2021.

Douglas Le Fort was appointed
as Non-Executive Director of
AMS in August 2021.

Liz Shanahan was appointed
as Non-Executive Director
of AMS in August 2022.

external

appointments

Peter Allen is currently

Chris Meredith was

None.

the Non-Executive Chair of

appointed Chair of Arterius,

Nasdaq-listed Abcam plc. He is

a UK-based pre-commercial,

also a Non-Executive Director of

non-competitive medical device

Istesso Limited, and a qualified

company, in January 2022. He

Chartered Accountant.

left his role as a Non-Executive

Director of Creavo Medical

Technology Ltd in

November 2021.

Grahame Cook is Chair
of Molten plc, a FTSE 250
Company, and a Non-Executive
Director of Minoan plc and
Sapience Communications
Limited.

Liz Shanahan is currently
a Non-Executive Director
of Inspiration Healthcare
Group plc and Celadon
Pharmaceuticals plc (previously
Summerway Capital plc), both
of which are AIM-listed.

Douglas Le Fort is currently an
Operating Partner for Revival
Healthcare Capital Partners, an
investor in medical device and
diagnostics businesses, as well as
a Non-Executive Director at Trio
Healthcare, a manufacturer of
ostomy products, Clinisupplies,
a UK-based manufacturer of
chronic care products and “The
Insides” Company Ltd, a start-up
addressing intestinal failure
based in New Zealand.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

SeN I Or M A N A GeMeN T TeA M

In addition to the CEO and CFO,
the SMT consists of Business Unit
and functional heads committed
to long-term sustainable growth

Simon Coates
IT Director

Andy Donnelly
Group R&D Director

Brian Dowd
Vice President - Corporate
Business Development

Rose Guang
Group Quality Assurance/
Regulatory Affairs (QA/RA) Director

Ross McDonald

Cathy Tomlinson

Becky Walmsley

Owen Bromley

Business Unit Director, Surgical

Group HR Director

Business Unit Director, Woundcare

Company Secretary

Andy joined AMS in July 2022 as
Group R&D Director. Originally
trained as a Pharmacist with a
PhD in drug delivery Andy has
over 25 years of R&D experience
leading teams with
responsibilities ranging from
Drug Product Development,
Device Development and
Drug-Device Combination
Products.

Andy served 17 years at
AstraZeneca, where he also
gained international experience
through roles based in the UK,
Sweden and the USA. After
leaving AstraZeneca he joined
Bespak, spending eight years
at their Innovation Centre in
Cambridge, UK.

Prior to joining AMS, Andy
was Vice President Innovation
at Bespak (part of the
Recipharm Group).

Brian joined AMS in July 2009
as GM of the US to initiate a
surgical business and launch
LiquiBand. Brian graduated
with honours and a degree in
Marketing/Communications
and Entrepreneurial studies
from Babson College in 1997
and earned an Executive MBA
from the Sawyer School of
Management, Suffolk
University in 2005.

Brian has over 20 years’
experience in Medical Devices;
his first 10 at Tyco/Covidien
mostly involved with Dental and
AWC products. Since joining
AMS Brian has been the GM of
the US business in which he
developed the US team and
grew to +20% Market Share;
he has also served as Global
Director of Marketing for the
Surgical BU prior to taking his
current post in early 2022.

Rose joined AMS in May 2013 as
Group QA/RA Director having
completed her Masters Degree
in Precision Engineering from
Nanyang Technology University
in Singapore. Rose has over 20
years’ experience working for
medical device companies and
has a strong background in
setting up effective quality
systems. Rose has worked for
Bausch & Lomb International
Healthcare, Nypro and spent
nine years at Medical House
Products plc as Director of
Quality, Regulatory Affairs and
Operations. Prior to joining AMS,
Rose was Head of Quality and
Regulatory Affairs at Bespak,
part of Consort Medical plc.

Rose is also a 6 Sigma Master
Black Belt.

Simon joined AMS in 2002 as
Group Information Systems
Manager and, during the
Company’s growth since then,
he has overseen many key IT
projects including implementing
ERP systems across the Group,
integrating acquisitions and
relocating the business into
its existing Winsford site.

Simon has over 25 years’
experience in IT infrastructure,
systems implementation and
software development gained
from a number of different
industries. Prior to joining AMS
he was Worldwide IT Manager
at Whitford Plastics Ltd, a
manufacturer of fluropolymer
coatings, supporting them
through a period of rapid
growth, managing multiple sites
and key IT projects including
ERP implementation and
adoption of the Euro for
the European offices.

Simon was appointed to the
Senior Management Team
in January 2015.

Prior to joining AMS in January

Cathy joined AMS in May 2017

Becky joined AMS in July 2015

Owen joined AMS in April 2012

2006 Ross graduated with his

as Group HR Director. Cathy

as Business Unit Director of

as Assistant Company Secretary

BSc from University of Glasgow

graduated with a degree in

OEM and Bulk Materials. Becky

and became Deputy Company

and then completed an MSc in

Business Studies from Liverpool

graduated with a degree in

Secretary in October 2013.

Entrepreneurial Studies from

John Moores University and

Modern Languages (French and

Having completed a BA (Hons)

Glasgow Caledonian University.

completed a Masters in Business

German) with International

Following university, Ross then

Administration at Strathclyde

Studies from South Bank

University. She spent five years

University in 1993 and

in International Business

and a Masters in Business

Administration (MBA), he

spent five years within the

Pharmaceutical industry.

Upon joining AMS, from 2006

to 2012, Ross worked across

our direct and distributed sales

working for Amazon and was

completed an Executive Masters

helped to launch a licensed

Head of HR for their final mile

of Business Administration at

Corporate Service Provider

delivery business (a start-up

Lancaster University in 2000.

on the Isle of Man in 2006 and

business for Amazon).

Becky has more than 13 years’

functions both in the UK Sales

Prior to this Cathy held senior

experience in the Medical

organisation, before taking on

HR roles for Xerox (supporting

Device sector, having held

responsibility for the European

the outsourcing of managed

various Senior Management

Woundcare Business in 2010.

services from government and

roles, most recently as

In 2012 Ross relocated to the US.

blue chip organisations to Xerox)

European Sales Director

and Emirates Airline, based in

for Scapa Healthcare.

sustained and high growth for

geographies and acquisitions).

Dubai (where she supported the

growth of the airline in new

qualified through the Institute

of Chartered Secretaries and

Administrators (ICSA) in 2007,

now the Chartered Governance

Institute. He moved to the UK in

2010, working at Eversheds LLC

and GB Group plc prior to AMS.

In January 2021, Owen was

appointed as Company

Secretary.

In his role as National Sales

Manager Americas, he

contributed to a period of

the LiquiBand® franchise. In

October 2016 Ross returned to

the UK to take up a new role as

Director of Sales for US, UK and

Germany and quickly moved into

the Global Sales Director role for

the Surgical Business Unit.

In January 2021, Ross was

appointed to the Business Unit

Director role for the Surgical

Business Unit.

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Simon Coates

IT Director

Andy Donnelly

Group R&D Director

Brian Dowd

Vice President - Corporate

Business Development

Rose Guang

Group Quality Assurance/

Regulatory Affairs (QA/RA) Director

Ross McDonald
Business Unit Director, Surgical

Cathy Tomlinson
Group HR Director

Becky Walmsley
Business Unit Director, Woundcare

Owen Bromley
Company Secretary

Simon joined AMS in 2002 as

Andy joined AMS in July 2022 as

Brian joined AMS in July 2009

Rose joined AMS in May 2013 as

Group Information Systems

Group R&D Director. Originally

as GM of the US to initiate a

Group QA/RA Director having

Manager and, during the

trained as a Pharmacist with a

surgical business and launch

completed her Masters Degree

Company’s growth since then,

PhD in drug delivery Andy has

LiquiBand. Brian graduated

in Precision Engineering from

he has overseen many key IT

over 25 years of R&D experience

with honours and a degree in

Nanyang Technology University

projects including implementing

leading teams with

ERP systems across the Group,

responsibilities ranging from

Marketing/Communications

and Entrepreneurial studies

in Singapore. Rose has over 20

years’ experience working for

integrating acquisitions and

relocating the business into

its existing Winsford site.

Drug Product Development,

from Babson College in 1997

medical device companies and

Device Development and

Drug-Device Combination

and earned an Executive MBA

has a strong background in

from the Sawyer School of

setting up effective quality

Simon has over 25 years’

experience in IT infrastructure,

Andy served 17 years at

Products.

Management, Suffolk

University in 2005.

systems implementation and

AstraZeneca, where he also

Brian has over 20 years’

software development gained

gained international experience

experience in Medical Devices;

from a number of different

through roles based in the UK,

his first 10 at Tyco/Covidien

industries. Prior to joining AMS

Sweden and the USA. After

mostly involved with Dental and

he was Worldwide IT Manager

leaving AstraZeneca he joined

AWC products. Since joining

at Whitford Plastics Ltd, a

Bespak, spending eight years

AMS Brian has been the GM of

manufacturer of fluropolymer

at their Innovation Centre in

Cambridge, UK.

Prior to joining AMS, Andy

was Vice President Innovation

at Bespak (part of the

Recipharm Group).

the US business in which he

developed the US team and

grew to +20% Market Share;

he has also served as Global

Director of Marketing for the

Surgical BU prior to taking his

current post in early 2022.

coatings, supporting them

through a period of rapid

growth, managing multiple sites

and key IT projects including

ERP implementation and

adoption of the Euro for

the European offices.

Simon was appointed to the

Senior Management Team

in January 2015.

systems. Rose has worked for

Bausch & Lomb International

Healthcare, Nypro and spent

nine years at Medical House

Products plc as Director of

Quality, Regulatory Affairs and

Operations. Prior to joining AMS,

Rose was Head of Quality and

Regulatory Affairs at Bespak,

part of Consort Medical plc.

Rose is also a 6 Sigma Master

Black Belt.

Prior to joining AMS in January
2006 Ross graduated with his
BSc from University of Glasgow
and then completed an MSc in
Entrepreneurial Studies from
Glasgow Caledonian University.
Following university, Ross then
spent five years within the
Pharmaceutical industry.

Upon joining AMS, from 2006
to 2012, Ross worked across
our direct and distributed sales
functions both in the UK Sales
organisation, before taking on
responsibility for the European
Woundcare Business in 2010.
In 2012 Ross relocated to the US.
In his role as National Sales
Manager Americas, he
contributed to a period of
sustained and high growth for
the LiquiBand® franchise. In
October 2016 Ross returned to
the UK to take up a new role as
Director of Sales for US, UK and
Germany and quickly moved into
the Global Sales Director role for
the Surgical Business Unit.

In January 2021, Ross was
appointed to the Business Unit
Director role for the Surgical
Business Unit.

Cathy joined AMS in May 2017
as Group HR Director. Cathy
graduated with a degree in
Business Studies from Liverpool
John Moores University and
completed a Masters in Business
Administration at Strathclyde
University. She spent five years
working for Amazon and was
Head of HR for their final mile
delivery business (a start-up
business for Amazon).

Prior to this Cathy held senior
HR roles for Xerox (supporting
the outsourcing of managed
services from government and
blue chip organisations to Xerox)
and Emirates Airline, based in
Dubai (where she supported the
growth of the airline in new
geographies and acquisitions).

Becky joined AMS in July 2015
as Business Unit Director of
OEM and Bulk Materials. Becky
graduated with a degree in
Modern Languages (French and
German) with International
Studies from South Bank
University in 1993 and
completed an Executive Masters
of Business Administration at
Lancaster University in 2000.

Becky has more than 13 years’
experience in the Medical
Device sector, having held
various Senior Management
roles, most recently as
European Sales Director
for Scapa Healthcare.

Owen joined AMS in April 2012
as Assistant Company Secretary
and became Deputy Company
Secretary in October 2013.
Having completed a BA (Hons)
in International Business
and a Masters in Business
Administration (MBA), he
helped to launch a licensed
Corporate Service Provider
on the Isle of Man in 2006 and
qualified through the Institute
of Chartered Secretaries and
Administrators (ICSA) in 2007,
now the Chartered Governance
Institute. He moved to the UK in
2010, working at Eversheds LLC
and GB Group plc prior to AMS.

In January 2021, Owen was
appointed as Company
Secretary.

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A strong governance framework to
support our resilience, innovation
and growth

Dear Shareholder,
On behalf of the Board, I am pleased to present the Corporate
Governance Report for the year ended 31 December 2022.

Corporate Governance is as important as ever in the current
market conditions and, in this environment, I am delighted
with the resilience that the Company has shown as it
continues to invest in innovation and deliver growth
as well as progressing with its ESG strategy.

The Board believes that shareholder engagement and strong
corporate governance are critical to the success of our
strategy, outlined on pages 14 to 17, and to delivering
long-term, sustainable shareholder value.

Changes to the Board and Succession Planning
In 2022 we continued to refresh the composition of
Non-Executives on the Board after an extensive search led
to the appointment of Liz Shanahan to the Board in August.
Following long service, Penny Freer retired from the Board
at the 2022 AGM and Douglas Le Fort took on the role of
Chair of the Remuneration Committee.

I recognise that I have now been Chair for more than the nine
years recommended by the UK Corporate Governance Code,
but also note that Code states that this period can be extended
for a limited time to facilitate effective succession planning and
the development of a diverse board. The recruitment process
for my successor is well underway and we expect this to be
completed in the near future. I am therefore putting myself
forward for re-election at the AGM and will step down once
this process is complete, allowing for a smooth and effective
handover. We will keep the market updated on progress
regarding this appointment.

The appointment of my successor will complete the
programme of Board refreshment, started in 2020. I have
thoroughly enjoyed being part of the growth of AMS during
my tenure and wish the Company continued success. I believe
the appointments made during this period will provide the
Board with the skills and experience for the future success of
the business, and to continue the growth seen in recent years.

Peter Allen,
Chair

“Achieving our strategic
goals through good
governance and integrity
across our entire business.”

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Corporate Governance
We choose to comply with the UK Corporate Governance
Code (Code) as far as is practicable and appropriate for a
public company of the Group’s size. We remain committed to
maintaining high standards of corporate governance which is
key to generating shareholder value, protecting stakeholders
interests and long-term sustainable growth.

A breakdown of our compliance with the Code can be seen
on page 56 and on our website at www.admedsol.com.

The Code reinforces the need to understand the views of
our stakeholders and consider these as part of our decision
-making, which is exemplified by the fact that we engaged
with of a number of key shareholders on our ESG strategy
in 2022. Details of how we engage with our stakeholders
are set out on pages 24 to 27.

Environmental, Social and Governance (ESG)
ESG is a focus area for our stakeholders and we continued
to devote significant time and resource to our ESG strategy
during 2022, including an Internal Audit to assess our progress
and ensure that we are focused on the key areas. Our ESG
framework provides the basis for us to continue to make
progress on ESG in future years and we have begun work with
an external consultant on our Pathway to Net Zero, which has
provided us with a Carbon Balance Sheet which was a key part
of a Net Zero Workshop. Details of our progress is set out in
the ESG Report on pages 32 to 33.

Recognition and Looking Forward
On behalf of the Board, I would like to express my appreciation
for the dedication, hard work and adaptability of all of our
colleagues in 2022 in facing the challenges posed by
current economic conditions.

Despite the ongoing challenges, we have taken significant
steps to progress our strategy and I strongly believe that AMS
remains well positioned to take advantage of opportunities
as they arise. During the coming year, in addition to further
strengthening our corporate governance, the Board will
focus on:

• Supporting the navigation of challenging global conditions

• Supporting the refinement and implementation of our

ESG strategy.

Peter Allen
Chair and Chair of the Nomination Committee
18 April 2023

Corporate Governance Report
The Board is committed to the principles of good corporate
governance which encompass leadership, effectiveness,
accountability, remuneration and shareholder relations.
Our shares are quoted on the AIM market and are subject
to the AIM Admission Rules of the London Stock Exchange.

Throughout the year
The Board met seven times during the year. All of the meetings
were held in the UK. The Directors attended the following
meetings in the year ended 31 December 2022:

Board member

Board

Peter Allen
Grahame Cook
Douglas Le Fort
Chris Meredith
Eddie Johnson
Penny Freer (retired
8 June 2022)
Liz Shanahan**

7/7
7/7
7/7
7/7
7/7

4/4
3/3

Audit
Committee

Remuneration
Committee

Nomination
Committee

3/3*
3/3
3/3
3/3*
3/3*

3/3
2/2

3/3
3/3
3/3
3/3*
3/3*

1/1
2/2

4/4
4/4
4/4
4/4
4/4*

3/3
1/1

Invited.

*
** Appointed as Non-Executive Director on 1 August 2022.

In 2022, as part of the focus on key stakeholders, the Board
has given significant focus on building on our ESG Framework
as can be seen in our ESG Report on pages 28 to 39, with a
particular focus on developing our Pathway to Net Zero. Liz
Shanahan was designated as the Non-Executive Director for
workforce engagement following her appointment and
employee engagement remained high, with a Group-wide
engagement survey and CEO video conferences with each
site. Management have regularly updated the Board on
employee engagement throughout the year. The engagement
score in our 2022 employee engagement survey indicates a
high overall level of satisfaction in the workforce, confirming
our expectation that the actions taken from the output of the
2021 survey had been positively received. In 2023 we will be
focusing on proactive ways to further increase this.

As in previous years, the implementation of strategy has
been an area of focus in our Board meetings. The Executive
Directors have provided regular updates, allowing the Board
to be informed of our view on the successes and challenges
throughout the Group and review future direction through
five-year strategic plans. In the current regulatory environment
there has been significant focus on the Medical Devices
Regulation (MDR). Direct engagement with our significant
shareholders in 2020 and 2021 on ESG, Remuneration Policy
and Board refreshment meant that our plans have been clearly
communicated and no further engagement outside of the
usual discussion with management were required in 2022.
Details of our principal risks are set out on pages 46 and 47.
The Risk Register and principal risks are regularly assessed by
the Board and Audit Committee. Further information regarding
the principal matters discussed by the Board during 2022 is set
out on page 56.

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Board activities

The UK Corporate
Governance Code

Risk management

Monitoring business performance

Setting strategy

Approving business plans
and budgets

Development of ESG

Our culture –
Care, Fair, Dare

External influences

Board activities

Internal influences

The AIM Rules

Considering and communicating
with stakeholders

Overseeing corporate culture

Considering strategic acquisitions

Considering strategic disposals

Our Mission –
Develop,
Make a real difference,
Add value

Vision
A world where the outcome of every patient can benefit from our products
and a company where every employee feels invested and valued

2023 AGM
In 2023, we will put forward all Directors for re-election
in accordance with Code Provision 18.

Peter Allen and Liz Shanahan own shares in the Company
as shown on page 74. These holdings have been highlighted
to shareholders and are small. Although not an issue for the
Chair, they would not be considered to impact Non-Executive
Director independence under Code Provision 10.

The 2023 AGM will be convened at 11.00am on 31 May 2023.
The 2023 Annual General Meeting will not have any COVID-19
specific restrictions on attendance and participation. Details of
the AGM will be outlined in the AGM Notice, on the Company’s
website www.admedsol.com and through RNS announcements
to the market.

The results of the AGM will be announced to the London Stock
Exchange and placed on the AMS website www.admedsol.com,
in the usual way, as soon as practicable after the conclusion
of the AGM.

The Board would like to thank all shareholders for their
continued support.

Relations with Shareholders
The Strategic Report, which incorporates the Chair’s
Statement, Chief Executive’s Q&A, Financial Review, Section
172 Statement, Stakeholder Engagement, Risk Management
and Sustainability/ESG sections, together with other
information in the Annual Report of the Group, provides
a detailed review of the business. The views of both
institutional and private shareholders are important, and
these can be varied and wide-ranging, as is their interest in
the Company’s strategy, reputation and performance. The
Executive Directors have overall responsibility for ensuring
effective shareholder communication and the Company
maintains a regular dialogue with its shareholders, which
is described in the Stakeholder Engagement section on
pages 24 to 27.

The Notice for the Annual General Meeting is sent to
shareholders at least 20 working days before the meeting.

The AMS website www.admedsol.com is regularly updated
and provides additional information on the Group including
information on the Group’s products and technology.

Role of the Board
The role of the Board is to establish the Vision and strategy for
the Group, to deliver shareholder value and take responsibility
for the long-term, sustainable success of the Company.
Individual members of the Board have equal responsibility for
the overall stewardship, management and performance of the
Group and for the approval of its long-term objectives and
strategic plans.

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Division of Responsibilities
There is a clear division of responsibilities between the role of the Chair and the Chief Executive Officer of the Company.
The roles are clearly set out in writing.

Chair
Peter Allen

Chief Executive Officer
Chris Meredith

• Leadership and management of the Board.

• Managing the Group’s business.

• Setting the Board’s agenda, style and tone of

• Developing Group strategy for consideration and

discussions.

approval by the Board.

• Ensuring the Board’s effectiveness in all aspects of

its role.

• Working closely with the Chief Executive Officer on

developing the Group’s strategy, and providing
general advice and support.

• Facilitating active engagement by all members.

• Participating in shareholder communications.

• Promoting high standards of corporate governance.

• Leading the Senior Management Team (SMT) in
delivering the Group’s strategic and day-to-day
operational objectives.

• Leading and maintaining communications with

all stakeholders.

Senior Independent Director
Grahame Cook

Non-Executive Directors
Liz Shanahan

• Acting as an intermediary for other Directors when

Douglas Le Fort

necessary.

• Available to meet with shareholders and aid

communication of shareholder concerns when
normal channels of communication are inappropriate.

• Chairing meetings of Non-Executive Directors, if and

when required.

• All responsibilities of a Non-Executive Director as

outlined (see right).

• Chairs meetings of the Nominations Committee when

it is considering succession to the Chair.

• Provides a sounding board for the Chair and conducts

the Chair’s annual evaluation.

• Constructively challenging and contributing to

the development of strategy.

• Monitoring the integrity of financial information,

financial controls and systems of risk management
to ensure they are robust.

• Reviewing the performance of Executive Management.

• Formulating Executive Director remuneration.

• Responsibility for Workforce Engagement

(by appointment)

The Non-Executive Directors
Each of the Non-Executive Directors is free from any relationship with the Executive Management and from any business or
other relationship that could affect or appear to affect the exercise of their independent judgement. The Board considers that all
of the Company’s Non-Executive Directors are Independent Directors, in both character and judgement, in accordance with
the recommendations of the Code.

The Chair, Peter Allen, was considered independent on his appointment.

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The Operation of the Board
The Board has the responsibility for ensuring that the Group
is appropriately managed and achieves the strategic objectives
it sets. To achieve this the Board reserves certain matters for
its own determination, including matters relating to Group
strategy, approval of interim and annual financial results,
dividends, major capital expenditure, budgets, monitoring
business and financial performance, treasury policy, corporate
governance, risk management, development of Environmental,
Social and Governance strategy and the effectiveness of its
internal control systems. It has a schedule of matters
specifically reserved for its approval. Matters are delegated to
the Board Committees, Executive Directors and the Senior
Management Team where appropriate, and the Group’s
delegation of authority policy was reviewed and updated
within the year to ensure it continues to align with best
practice. The Board performs its responsibilities through
an annual programme of meetings and by continuous
monitoring of the performance of the Group.

Board Committees
The Board has delegated authority to the Audit, Remuneration
and Nomination Committees. Grahame Cook, Douglas Le Fort
and Liz Shanahan are members of the Audit, Remuneration
and Nomination Committees. Peter Allen is a member of the
Remuneration and Nomination Committees. Chris Meredith
is a member of the Nomination Committee.

Board Composition
The Board comprises the Non-Executive Chair, two Executive
Directors and three Non-Executive Directors. The Directors’
profiles on pages 48 and 49 detail their experience and
suitability for leading and managing the Group. Together
they bring a valuable range of expertise and experience to
the Group. No individual or group of individuals dominates the
Board’s decision making process. The Chair fosters a climate
of open debate in the Boardroom, built on his challenging but
supportive relationship with the Chief Executive Officer which
sets the tone for Board interaction and discussions.

Matters considered by the Board in 2022 included:

• Strategic plans.

• Vision, Mission and Values.

• Supply chain resilience.

• Continuing impact of the COVID-19 pandemic.

• Impact of inflation and rising cost of living.

• Environmental, Social, Governance (ESG).

• Impacts of Brexit.

• Dividend policy.

• Acquisition strategy including potential acquisition

targets and valuations.

• MDR and regulatory pathways.

• Health and safety.

• UK Corporate Governance Code compliance.

• Board refreshment.

• Directors’ responsibilities.

• Group delegation of authority policy.

• Risk review including disaster recovery and

business interruption.

• Major capital expenditure.

• Finance and operations review.

• Board evaluation and Board support.

• Reports from the Board Committees.

• Annual budget, results, forecast updates.

• Organisation and Senior Management structure.

• Shareholder base and investor engagement.

• Registrar and share scheme structure and administration.

The Board also delegates a number of its responsibilities
to Committees and management as described below.

All Directors have access to the advice and services of the
Company Secretary. The Non-Executive Directors are able
to contact the Executive Directors, Company Secretary or
Senior Managers at any time for information about the Group.

Appointment of Non-Executive Directors
Non-Executive Directors are appointed to the Board following
a formal, rigorous and transparent process, involving external
recruitment agencies, to select individuals who have a depth
and breadth of relevant experience to ensure that they can
make an effective contribution to the Board. Details of
how the Nomination Committee managed the process
for appointing Liz Shanahan can be found on page 60.

Diversity
We recognise the importance of diversity at Board level. The
Board has a wide range of skills and experiences from a variety
of business backgrounds and a number of nationalities. The
female Board representation at 31 December 2022 was 16.7%.
The FTSE Womens Leaders Review target (33%) is considered
during the succession planning process.

The SMT also has diverse experience. It is comprised of several
nationalities and female representation is 43%. Our Group
Equality, Diversity and Inclusion (EDI) Policy ensures diversity
is considered at all levels and across the Group. We launched
an EDI Committee in early 2022 which reports into the ESG
Steering Committee. We continue to take steps to further
promote diversity amongst our employees at all levels.

Compliance with the UK Corporate Governance Code
As a large AIM quoted company, AMS has chosen to follow the
Code and is compliant in the majority of areas. The Company
does not comply with Provision 36 (formal policy for post-
employment shareholding), as there is no policy in place at this
time and Provision 38 (pension contribution rates for Executive
Directors, or payments in lieu, should be aligned with those
available to the workforce). The company does not consider
the current contributions of 10% to be excessive and will review
this for any new appointments. We are unable to comply with
Provision 31 as we do not prepare a formal viability statement.
Please see references to Going Concern on pages 57, 62, 80
and 92.

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Terms of Appointment and Time Commitment
All Non-Executive Directors are appointed for an initial term of three years subject to satisfactory performance. After this time
they may serve additional three-year terms following review by the Board. Notwithstanding such three-year terms, all Non-
Executive Directors are proposed annually to shareholders for reappointment in accordance with best practice. All Non-
Executive Directors are expected to devote such time as is necessary for the proper performance of their duties. Directors
are expected to attend all Board meetings and Committee meetings of which they are members and any additional meetings
as required.

Further details of their terms and conditions are summarised in the Remuneration Report on pages 65 to 75 and the full terms
and conditions of appointment of the Non-Executive Directors are available at the Company’s Registered Office.

Tenure Chart
The Board was comprised of either five or six members throughout 2022. The Board tenure is shown below.

Date of appointment

10+

Peter Allen
Grahame Cook
Chris Meredith
Eddie Johnson
Douglas Le Fort
Liz Shanahan
Penny Freer

4 December 2013
1 February 2021
11 April 2006
1 January 2019
2 August 2021
1 August 2022
1 March 2010

Induction and Professional Development
Each new Director is given a formal induction process
including details of how the Board and Committees operate,
meetings with Senior Management, information on Group
strategy, products and performance and access to policies
and other key documents. Further details on the induction
can be found in the Nomination Committee Report on page 59.

Training and development needs of Directors are reviewed
regularly. The Directors are kept appraised of developments
in legal, regulatory and financial matters affecting the Group
by the Company Secretary and the Group’s External Auditors
and advisors.

Professional Advice, Indemnities and Insurance
There is provision for Directors to take independent
professional advice relating to the discharge of their
responsibilities, with the Company paying for such advice.
The Company has arranged Directors’ and Officers’ liability
insurance against certain liabilities and defence costs.
However, the Directors’ insurance does not provide
protection in the event of a Director being found
to have acted fraudulently or dishonestly.

Board and Committee Evaluation
The performance evaluation of the Board, its Committees and
Directors is undertaken by the respective Committee Chair’s
annually and more detail on this evaluation is set out in the
Report of the Nomination Committee on page 60.

Audit, Nomination and Remuneration Committees
The Committee Reports can be found on pages 61 to 64,
58 to 60 and 65 to 75 respectively.

Date of election
or next re-election

31 May 2023
31 May 2023
31 May 2023
31 May 2023
31 May 2023
31 May 2023
Retired in 2022

Going Concern
In carrying out their duties in respect of Going Concern, the
Directors have carried out a review of the Group’s financial
position and cash flow forecasts for the next 12 months from
the signing of the accounts. These have been based on a
comprehensive review of revenue, expenditure and cash
flows, taking into account specific business risks and the
current economic environment. The Directors are confident
the business can withstand the challenges and is a Going
Concern, due to the significant headroom available.

With regard to the Group’s financial position, The Group
continues to be highly cash-generative and had net cash
of £82.3 million at December 2022 and the potential for
significant debt funding with its banks (NatWest and HSBC).

Demand for the Group’s products is strong, despite levels of
elective surgery remaining below pre-pandemic levels, due
to capacity issues in the healthcare systems of most major
economies. Contracts are in place with key customers
that include government agencies and global healthcare
companies across different geographic regions that have
substantial financial resources.

The Group continues to closely monitor the global supply
chain crisis and the ongoing impact of high inflation, increased
cost of living, ongoing cases of COVID-19, and workforce
issues in the NHS and other healthcare systems.

Having considered the above, the Directors have concluded
that the Group is well placed to manage its business risks
in the current economic environment. Accordingly, they
continue to adopt the Going Concern basis in preparing
the Financial Statements.

Remuneration
The level of remuneration of the Directors is set out
in the Remuneration Report on pages 65 to 75.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

N O M I N A T I O N C O M M I T Te e r eP OrT

Good progress in refreshing
the Board for future challenges

Dear Shareholder,
As Chair of the Nomination Committee, I am pleased to
present the Committee’s report for the year ended 31 December
2022. The report outlines the Committee’s work to fulfil our
responsibilities for reviewing Board composition and balance,
considering the skills and capabilities required for each new
Board appointment, leading the process for the Board in
relation to new appointments and reviewing succession
planning for the Board and Senior Management. The
Committee continues to perform this with the utmost
professionalism and diligence.

The Committee met three times during the year and was
chaired by myself, with Grahame Cook, Douglas Le Fort
and Chris Meredith as the other Committee members in
place throughout the year.

We initiated a plan to refresh the composition of the Board
in 2020, which progressed in 2022 with Penny Freer retiring
at the AGM. Liz Shanahan joined the Board as a Non-Executive
Director on 1 August 2022 and was appointed to the
Committee immediately.

The Committee remains focused on this programme of Board
refreshment and the final step is to recruit my successor. This
recruitment process is well progressed, taking into account
the FTSE Women Leaders Review and our commitment to
equality and diversity.

We will report to shareholders on the outcome of this
recruitment process once it is complete, ensuring a
smooth and effective handover of responsibilities.

I believe that the actions we have taken will ensure that
the Board’s size and composition is appropriate for a Group
of AMS’s size, complexity and nature and will put us in the best
possible position to drive long-term sustainable growth for the
benefit of our stakeholders. We are pleased with the progress
made in 2022 and that AMS continues to be a great place to
work and attract great people.

Peter Allen,
Chair

Peter Allen
Chair of the Nomination Committee
18 April 2023

“The Committee has
continued to focus on
succession planning
and the programme
of Board refreshment.”

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Attendance record and tenure in 2022

Member

Peter Allen (Chair)
Grahame Cook
Douglas Le Fort
Chris Meredith
Liz Shanahan (joined 1 August 2022)
Penny Freer (retired in June 2022)

Number of meetings
held during the year

Number of
meetings attended

3
3
3
3
2
1

Committee
tenure

9 years
2 years
18 months
12 years
5 months
13 years

Board changes in the year
The Committee oversaw a rigorous recruitment process for
the appointment of a Non-Executive Director following the
retirement of Penny Freer. We were delighted to welcome
Liz Shanahan to the Board on 1 August 2022. Her appointment
followed an extensive search which the Chair led with an
executive search consultancy, Dzaleta Consulting, who
specialise in Life Sciences. A shortlist of candidates were
interviewed by members of the Board.

Liz Shanahan is a life sciences entrepreneur with extensive
experience advising leading global pharmaceutical and
healthcare organisations on their communications. Most
recently, she was a Non-Executive Director of UDG Healthcare
plc, a company that was listed on the London Stock Exchange
and a constituent of the FTSE 250 up until its £2.8 billion
takeover in August 2021. Until 2014, she was Global Head of
Healthcare & Lifesciences at the NYSE-listed management
consultancy, FTI Consulting Inc., which in 2007 acquired the
communications business Santé Communications, founded
by Liz in 1995. Liz is a Trustee of CW, the charitable arm of
Chelsea & Westminster Foundation Trust Hospital in London
and a member of the organisation’s Innovations Advisory.

Following Liz’s appointment, the Board assessed their
composition, skills and experience and decided that no
further changes were required except for changing the
Chair of the Board due to the requirements of the UK
Corporate Governance Code and in line with our succession
planning programme. Liz took on responsibility for Workforce
Engagement following Penny’s retirement.

Board members were unanimous in approving the appointment
of Liz. Following her appointment she received a tailored
induction programme to enhance her knowledge and
understanding of the Company’s business, strategy and
governance structure, as well as her own duties and
responsibilities. She spent time with the Executive Directors,
Non-Executive Directors,Senior Management Team, Company
Secretary and other key personnel. She also received a briefing
on her role and duties as a Director of a publicly traded
company from external advisers.

Non-Executive Director appointment process
Board composition is central to the effective leadership of
the Group and therefore prior to commencing any search
for prospective Board members, the Committee draws up
a specification, reflecting on the Board’s current balance of
skills and experience and conscious of the desire to promote
diversity on the Board, including with respect to gender, social
and ethnic backgrounds, cognitive and personal strengths,
and those that would be conducive to the delivery of the
Company’s strategy. Reference is made to the FTSE Women
Leaders Review and, prior to this the Hampton-Alexander
guidance. Selection for Board appointments is made on
merit against this specification. We have again appointed
a search consultancy to support this process.

Gender diversity
Following the Board changes in the year, female
representation on the Board remains at 16.7%. AMS
continues to see the development of female executive
talent as important, which is reflected in the female
representation in the Senior Management Team (43%).

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N O M I N A T I O N C O M M I T Te e r eP OrT CO N T I N U E D

Board composition

n Non-Executive Chair

n Executive Directors

n Independent Non-Executive Directors

Board tenure

n 0-3 years

n 3-6 years

n >6 years

Appointment process

SCOPING

Nomination Committee discussion
(Both scheduled and ad hoc meetings)

Considerations

• Identification of a vacancy.

• Needs of the organisation, currently and future.

• The personal skills and qualifications required.

• The dynamics of the current Board.

Appointment of an Executive Search Consultancy

Considerations

• Market reputation.

• Reach.

Board gender diversity

• AMS Culture, Mission, Vision and Values.

n Female

n Male

Senior Management Team gender diversity

n Female

n Male

Activity in the year
The Committee focused on the appointment of a Non-
Executive Director and initial work on replacing the Chair in
2022. We have appointed Dzaleta Consulting for all executive
searches in 2022. Dzaleta Consulting has no connection with
AMS or any individual Directors, other than having provided
Executive search services for prior AMS Board appointments.

We undertook a Board Evaluation and Committee
Self-Assessment during 2022. The overall findings from
the effectiveness reviews concluded that AMS’s Board,
Committees and individual Directors continue to operate
effectively and the Board actively discussed any
recommendations arising out of the evaluations.

Production of a long list

Considerations

• Skillset.

• Experience.

• Gender, ethnicity and background.

Production of a short list

Considerations

• Specific skills.

• Experience.

• Potential for overboarding.

APPOINTMENT

Recommendation to the Board

Considerations

• Due diligence findings.

Priorities for 2023
The Committee will support the appointment and onboarding
of the new Chair in 2023. We will also continue to assess the
support required to develop the Senior Management Team
and potential succession internally, as well as the activity
necessary to drive a broader equality, diversity and inclusion
action plan.

POST APPOINTMENT

Induction programme

Considerations

• Directors’ duties and responsibilities.

• Familiarisation with the business.

• Meetings with key employees.

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A U D I T C O M M I T Te e r eP OrT

Strong governance of the Group’s
financial reporting and risk management,
protecting shareholders’ interests and
supporting the long-term strategy

Dear Shareholder,
As Chair of the Audit Committee, I am pleased to present the
Committee’s report for the year ended 31 December 2022.

This report sets out the work done by the Committee in the
year, to fulfil our responsibilities to shareholders and other
stakeholders and assist the Board in providing effective
governance over the Group. In meeting these responsibilities,
the Committee continues to reflect the provisions of the
UK Corporate Governance Code, FRC Guidance for Audit
Committees and other best practice. The Committee’s
Terms of Reference are available of our Website.

Strong governance of audit and risk management is critical
to the Group, to allow it to deliver the strategy outlined in
detail in the Our Strategy section on pages 14 to 17.

The Committee works to a structured programme of activities
focused on the Group’s reporting cycle, principal risks and
future strategy. Robust internal controls and risk management
systems ensure the resilience of the Group, while remaining
operationally agile and adaptable. Our work is ably supported by
our External Auditors, Deloitte, and our Internal Auditors, RSM.

Liz Shanahan became a member of the Committee on her
appointment as a Non-Executive Director on 1 August 2022.

The Committee met three times in 2022. In addition, there
were a number of ad hoc meetings with the External and
Internal Auditors. I am confident that the Committee is
well balanced, with the necessary skills and experience
to perform its critical oversight and governance function
within the Group.

Looking ahead, the Committee will continue to monitor the
resilience of the Group in the light of current challenges,
including exchange rate instability, higher energy prices,
unstable global supply chains, rising interest rates and
high inflation globally.

Grahame Cook
Chair of the Audit Committee
18 April 2023

Grahame Cook,
Chair of the
Audit Committee

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Attendance record and tenure in 2022

Member

Grahame Cook (Chair)
Douglas Le Fort
Liz Shanahan (joined 1 August 2022)
Penny Freer (retired in June 2022 at the AGM)

Number of meetings
held during the year

Number of
meetings attended

3
3
2
1

Committee
tenure

2 years
18 months
5 months
13 years

The Audit Committee governs the Group’s internal controls,
financial reporting and risk management, to provide
assurance to shareholders and other stakeholders.

Non-audit services
The External Auditor may provide non-audit services where
it is in the Group’s best interests, provided certain criteria are
met. The External Auditor must not audit their own work,
make management decisions for the Group, create a conflict
of interest or find themselves in the role of an advocate for
the Group. The Committee’s view is that any non-audit service
performed by the External Auditor should be assurance-
related, where there is limited scope for such conflict.

There was one project in 2022 where expenditure exceeded
the £10,000 threshold for approval by the Committee, which
was the £29,500 fee for audit related assurance services
relating to the review of the Interim Statements, which is
a permitted service. The Company’s policy on non-audit
services complies with the FRC’s 2019 Revised Ethical Standard.

Deloitte LLP has been the External Auditor for 15 financial years.
A performance, effectiveness and independence evaluation led
the Committee to recommend the reappointment of Deloitte
LLP as the Group’s External Auditor for the next financial year.

Aims and objectives
The aim of the Committee is to monitor the integrity of
the Group’s Financial Statements and announcements, its
accounting processes, and the effectiveness of its internal
controls and risk management system. The Committee
assists the Board in fulfilling its responsibility to ensure that
the Group’s financial systems provide accurate, up-to-date
information on its financial position and in its consideration as
to whether the Group’s published Financial Statements are fair,
balanced and understandable.

The Audit Committee is required to:

• Oversee and advise the Board on the risk exposures of
the Company and related risk management strategies.

• Oversee Internal Audit and review internal control policies
and procedures for the identification, assessment and
reporting of material financial and non-financial risks.

• Review the Group’s procedures for detecting and preventing

fraud, prevention of bribery and corruption and ensure
arrangements are in place to enable employees to raise
matters of possible impropriety in confidence.

• Review the content of the Annual Report and advise the
Board whether, taken as a whole, it is fair, balanced and
understandable and provides the information necessary for
shareholders to assess the Group’s position, performance,
business model and strategy.

• Review the engagement, effectiveness and independence
of the External Auditor, and consider a tender process.

• Review audit and non-audit services provided by the

external auditor and fees for such services.

• Review the Terms of Reference annually to ensure all key

areas are being considered and that the Committee’s remit
and activities are in line with best practice. These were last
updated in December 2022.

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Audit Committee activities
To discharge its responsibilities, during the year, the Committee has undertaken the following activities:

Topic

2022 main activities and key areas of focus

Financial
Statements
and Reports

• Reviewed and approved the External Audit fees for 2022.
• Reviewed the annual and half-yearly financial reports and related statements.
• Assessed key accounting judgements.
• Reviewed all significant matters in relation to the Financial Statements and how these have been addressed

including:

– Going Concern – Code Provision 31 requires the Directors to explain in the Annual Report how they assessed

the prospects of the Company, over what period and why that period is appropriate. The Committee
considered a wide range of information relating to present and future projections of profitability, cash
flows, capital requirements and capital resources. These considerations include stressed scenarios that
reflect any external uncertainties may have on the Group’s operations. The statement to be made by the
Directors was considered and it was concluded that the Group and Parent Company will be able to
continue in operation and meet liabilities as they fall due, and that it is appropriate that the long-term
viability statement covers a period of at least 12 months beyond the date of the Financial Statements.

– Impairment - reviewed the carrying amounts of its tangible and intangible assets to identify any indication
of impairment losses. If any such indication exists, the recoverable amount of the asset is estimated to
determine the extent of any impairment loss. Where the asset does not generate cash flows that are
independent from other assets, the Group estimates the recoverable amount of the cash-generating
unit to which the asset belongs. The Committee concluded that there was no requirement to record
an impairment of either of our two business units, Surgical and Woundcare, with our models showing
a significant level of comfort.

– Assessed risk management, risk appetite, internal controls, the risk and control reporting structure and
the ongoing process to monitor the principal risks of the Group. As part of these reviews, consideration
has been given to the ongoing impact on our supply chain due to a variety of factors.

• Monitored the independence and ensured the objectivity of the External Auditor, approved the Audit Plan for
the 2022 audit, reviewed the performance of the External Auditor, considered the reappointment of Deloitte
LLP as Auditor for 2023 and recommended their reappointment to the Board. In line with Best Practice as the
incumbent Audit Partner had served for five years, a new Audit Partner commenced in April 2022. In line with
best practice, the Committee meets periodically with the External Auditor without management being present.

• Continued the rolling Internal Audit Plan from RSM, including reports on supply chain and a follow-up

on business continuity and disaster planning.

• Reviewed and considered key risks to the Group, the plans and controls to mitigate these risks and

scoring criteria.

An annual performance review of the External Auditor was undertaken in December 2022 to assess:

• Effectiveness of the audit process.
• Resource quality – ensuring the right quality and balance of audit team resource and that the team provides

continuity, knowledge and a fresh perspective through new team members.

• Effective communication – ensuring key audit judgements are communicated at the earliest opportunity
to promote discussion and challenge between the External Auditors, management and the Committee.

• Communication regarding good practice, changes to reporting requirements and accounting standards enables
the Group to be properly prepared. Timely provision of audit papers enables adequate management review,
Committee consideration and feedback.

• Scoping and planning – timely provision of the External Audit Plan and timetable.
• Fees – ensuring they are transparent, appropriate and communicated prior to the commencement of any work

being undertaken. Variations are challenged at the earliest opportunity to enable dialogue and agreement.

• Auditor independence – the Committee monitors the External Auditor’s compliance with ethical guidelines and
considers their independence and objectivity. It is agreed that the External Auditor will generally not be considered
for external due diligence support, with non-audit services typically being assurance-related. The Committee
received and reviewed written confirmation from the External Auditor that there were no relationships that, in
their judgement, may impact their independence. The External Auditor has confirmed that they consider
themselves independent within the meaning of UK regulatory and professional requirements.

External
Audit

Internal
Audit
Risk
Management
Effectiveness
of External
Auditor

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Internal Audit
Internal Audit is delivered by RSM against an agreed plan under
the guidance of the Committee. RSM report directly into the
Committee, to avoid undue influence from management, and
focuses on areas of potential risk and process improvement.
A three-year Internal Audit Plan with RSM was agreed in
December 2022 to cover 2023–2025. The Committee:

• Ensures the Internal Audit function has the necessary
resources, independence and access to information,
employees, the Board and the Committee Chair’s to enable
it to fulfil its mandate.

• Approves the Internal Auditor appointment and termination.

• Reviews and assesses the Internal Audit work plan and

receives a report at least twice per year.

• Reviews and monitors management’s responsiveness to
the Internal Auditor’s findings and recommendations.

• Monitors and reviews the effectiveness of controls in

relation to the overall risk management system.

All reports are discussed with the Committee and the External
Auditor. Recommendations are considered and acted upon as
appropriate. RSM attends Committee meetings twice a year
and provides an update in writing ahead of each meeting.

In 2022 the Internal Auditor undertook reviews in line with
the Internal Audit Plan previously agreed by the Committee.
These reviews led to RSM reporting to the Committee on:

• Supply chain.

• Business continuity and disaster recovery follow-up.

These reports highlighted to the Committee that, although the
Group’s internal controls generally give very good assurance,
there are some specific non-critical improvements that could
be made within the Internal Controls Framework and Risk
Management Strategy. These have now been implemented.

This Framework and Strategy is updated regularly and is
available on the Company’s Intranet. Policies are updated and
formally approved by the Committee at least once a year,
including where necessary to give the Committee stronger
assurance about areas of key risk.

The Group also calls on the services of external bodies to
review the controls in certain areas of the Group. The quality
assurance systems are reviewed by the Group’s Notified
Bodies, the British Standards Institute (BSI), TÜV Rheinland,
TÜV Sud, DEKRA Certification GmbH and PCBC.

Risk management and internal controls
The Board, taking guidance from the Committee, monitors
and reviews all material controls including financial, operational
and compliance controls. Only reasonable and not absolute
assurances can be made against material loss or misstatement.
Key features of the internal control systems are:

• The Group has an organisational structure with clear

responsibility and accountability.

• The Board has a schedule of matters reserved for its
consideration which includes potential acquisitions,
significant capital projects, appointment of Senior
Management, treasury policies, risk management, approval
of budgets and re-forecasts, Health and Safety, Corporate
Governance and Environmental, Social and Governance (ESG).

• The Board monitors the activities of the Group through
monthly management accounts, half-year and full-year
forecasts, and reports on current activities and plans. The
Senior Management Team also regularly monitors financial
and operational performance.

• The Group has set appropriate levels of authorisation which
must be adhered to. These levels were comprehensively
reviewed by the Board and the Committee during the year,
with an updated authorisation matrix issued to the Group
in December 2022.

• An Enterprise Resource Planning (ERP) system, with in-built
controls over process and authority, minimising manual
intervention, is in place in the UK, the Netherlands and
Germany, with equivalent systems in other jurisdictions.

• The Group operates a ‘Whistleblowing’ Policy enabling

individuals to report any concerns to Senior Management
or the Company Chair. This policy allows for reporting to
be made on a confidential basis if necessary. This was
last updated in September 2022.

Any weaknesses identified in the Group’s internal control system
are reported to the Committee and corrective actions agreed.
General IT control findings have been noted and we are working
to remediate the deficiencies. In 2022 the Banking and Treasury
and Purchase to Pay Controls were updated and the changes
reviewed by the Committee.

Creating long-term shareholder value is the reward for taking
controlled risk. Risk management is crucial to the Group’s
success and is given a high priority to ensure that adequate
systems are in place to evaluate and limit risk exposure.

The Committee, Board and Management each formally review
the Risk Register at least twice a year. Risks are evaluated for both
likelihood and financial impact, helping to identify the most
significant risks the business faces. Actions are agreed to mitigate
the risks and progress is regularly assessed. The process for
identifying, evaluating and managing the risks faced by the
Group is ongoing throughout the year. As part of the External
Auditor’s annual review process, any key risks and areas of audit
focus are also identified and agreed with the Committee.

The Committee also reviewed an External Assurance List, a
summary of all audits and checks of various functions such as
IT conducted by external parties in 2022, and a list of all Group
insurance Policies, to ensure there is sufficient coverage in all
key areas. These reviews will be held annually.

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r eM U Ne rA T I O N C O M M I T Te e r eP OrT

Our remuneration policy supports value
creation and long-term sustainable growth
by aligning interests across the Group and
encouraging employee share ownership

Dear Shareholder,
I am pleased to present the Remuneration Committee
Report for the year ended 31 December 2022. I took over the
Committee Chair position following Penny Freer’s retirement
at the 2022 AGM, having worked closely with her for a period
of almost 12 months.

Peter Allen and Grahame Cook were members of the Committee
throughout the year, with Liz Shanahan becoming a member
of the Committee on her appointment as a Non-Executive
Director on 1 August 2022. The Committee formally met
three times during 2022.

The Committee’s role is to ensure that our Remuneration
Policy is appropriate for a successful, growing business with
the size and profile of AMS, reflecting the need to engage
the right calibre of employees to deliver our strategy in
an increasingly challenging economic environment.

AMS takes governance seriously and we remain committed
to high standards of corporate governance, putting this
report to an advisory vote each year at the AGM.

Our Remuneration Policy is designed to ensure that we are
able to attract, motivate and retain the talent we need to
ensure the resilience of the Group in these challenging times,
in particular with the cost-of-living crisis being experienced
in many parts of the world. This was evidenced by providing
support for our low earners in 2022, which has continued
into 2023.

A resolution will be put to shareholders at the AGM on
31 May 2023 asking shareholders to consider and
approve this Report.

Douglas Le Fort,
Chair of the
Remuneration
Committee

Douglas Le Fort
Chair of the Remuneration Committee
18 April 2023

“A Remuneration Policy to reflect the views
of our shareholders, support our employees
and support long-term, sustainable growth.”

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Attendance record and tenure in 2022

Member

Douglas Le Fort (Chair)
Peter Allen
Grahame Cook
Liz Shanahan (joined 1 August 2022)
Penny Freer (retired at the 2022 AGM)

Remuneration for 2022
The annual bonus awards and Long-Term Incentive Plan (‘LTIP’)
vesting in 2022 for the Executive Directors were as follows:

Annual bonus
The performance conditions for the Executives 2022 annual
bonus were based on the achievement of two financial targets
(Revenue and Adjusted PBT – accounting for 70% of the total
bonus) and an assessment of the delivery of personal objectives
(accounting for 30% of the total bonus). In view of performance,
the Committee determined:

• Revenue of (£124.3m) was above the threshold (£114.4m)

and target (£120.4m).

• Adjusted PBT of £28.5 million was marginally below the

threshold figure of £28.6 million.

• Personal objectives are linked to corporate, financial, strategic
and non-financial objectives (see page 71). The Committee
determined that 90% of these objectives were achieved.

LTIP
LTIP awards granted to Chris Meredith and Eddie Johnson in
April 2019 were due to vest in 2022 with performance criteria
and weightings as follows:

• TSR (50%) – the performance period ended on 23 April

2022. The Company ranked below the median (40th out
of 64 comparators) which resulted in a vesting of 0%.

• EPS (50%) – the growth in EPS was calculated over the three
financial years to 31 December 2021. The average annual
growth was 8.46%, above the threshold level of 5% which
resulted in a vesting of 42.3%.

• Overall across both elements the final vesting result was 21.2%.

Implementation of Remuneration Policy in 2022
The Committee undertook a review of the Remuneration
Policy (‘Policy’) in 2022; we reviewed salaries and the bonus
scheme. As a result of this review and shareholder engagement
we have made the following changes:

In January 2022 Chris Meredith’s salary was increased from
£350,000 to £364,000 and Eddie Johnson’s salary from
£210,000 to £218,400. Both increases were 4%, in line with
the workforce. In line with the longstanding commitment to
bring Eddie’s salary to around the 50th percentile for equivalent
CFOs, given his experience and strong performance, his salary
was increased to £250,000 in January 2023.

Number of meetings
held during the year
when the Director
was a member

Number of
meetings attended

3
3
3
2
1

Committee
tenure

18 months
9 years
2 years
5 months
13 years

As announced in the last Annual report, the Committee
reviewed the annual bonus scheme and LTIP award levels for
Executive Directors and the Senior Management Team in early
2022, and several changes were agreed that became effective
from January 2022 and will remain in place moving forward:

• Increased importance given to key non-financial objectives.
30% of the total bonus is now based on personal objectives
(including specific ESG targets) where exceptional
achievement may result in the award of a bonus even if
financial objectives were not achieved. The remainder is
be based on stretch revenue and adjusted PBT targets
(35% for each). The formal EPS target has been removed.

• Eddie Johnson’s maximum bonus potential increased to

100% of salary (up from 75%), to bring him in line with the
market median for CFO bonus potential. Chris Meredith’s
maximum potential bonus remains at 150% of salary.

• Senior Management Team maximum bonus potential

increased from 50% to 75% of salary.

• Eddie Johnson’s maximum LTIP award increased from

100% of salary to 125% of salary. Chris Meredith’s
maximum award remains at 200% of salary.

Compliance with the 2018 UK Corporate Governance
Code (‘Code’)
As a large AIM quoted company, AMS has chosen to follow
the Code and is compliant in the majority of areas including
malus and clawback provisions and share ownership
guidelines (Executive Shareholding Policy).

In consideration of the Code, specifically Provisions 36 (share
awards granted for Executive Directors should be subject to a
total vesting and holding period of five years or more) and 37
(remuneration schemes should include provisions that would
enable the Company to recover and/or withhold sums or
share awards), the structure of LTIP awards has changed.
These are now subject to a total vesting and holding period
of five years (three years’ vesting plus two additional years’
holding), in line with the Code and the trend for FTSE main
market companies. Both Deferred Bonus and LTIP awards
will also contain malus and clawback provisions.

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Full details of the share schemes offered to the Executive
Directors can be found on page 69 and 70. Provision 38 of
the Code outlines that pension contribution rates for Executive
Directors, or payments in lieu, should be aligned with those
available to the workforce. The Committee does not consider
the current contributions of 10% to be excessive and this issue
will be addressed for any new appointments. Full details of
compliance with the Code can be found on the Company’s
website (www.admedsol.com). When determining the Policy
the Committee is aware of the Code requirements for clarity,
simplicity, risk mitigation, predictability, proportionality and
alignment to culture. We believe that these requirements are
met as follows:

clarity
• Our Policy is well understood with a clear aim; support the

delivery of strategy and promote long-term sustainable growth.

• To achieve this the Policy aims to be strategically aligned,

promotes pay for performance, is competitive in the market
and provides a commitment to employees to pay fairly and
in a clear, transparent and simple way.

• Each component of remuneration is clearly explained in the
Policy table, including its purpose, how it is operated, the
maximum potential and any relevant performance measures,
which are disclosed for shareholders’ consideration.

Simplicity
• The Policy reflects standard UK market practice with an

annual performance bonus and LTIPs.

• All payments are in the form of cash or AMS shares and
no artificial structure is used to deliver remuneration.

Risk
• The Committee can use its discretion to override the
formulaic outcomes of the incentive plans if it is felt
appropriate in extreme circumstances.

• Malus and clawback provisions operate in the LTIP and

Deferred Annual Bonus plan (DAB) allowing payments to be
adjusted or withheld, and LTIP awards now include a market-
standard vesting and holding period totalling five years.

• There is an appropriate mix of financial, non-financial
and share price measures to avoid undue risk taking.

predictability
• Appropriate limits are set out in the Policy and within the

respective share scheme rules so outcomes can be predicted.

• In operating the Policy, the Committee continually monitors
the performance of share scheme awards so that it is aware
of potential outcomes and forewarned of potential issues.

proportionality
• The outcomes of our share schemes are aligned to delivery

of strategy and are measured against various metrics.

Alignment of culture
A focus of the Policy is long-term sustainable growth which
is reflected in our Care, Fair, Dare values. The change made
in 2022 to the annual bonus requirements ensures that the
Executive Directors take account of and reflect these values
(including ESG strategy) in their roles, over and above pure
financial performance. We voluntarily seek advisory
shareholder approval for our Remuneration Report
and feedback helps inform the Committee’s approach.
Specific comments on the Policy can be sent to the
Company Secretary (companysecretary@admedsol.com).

As an AIM-quoted Company, Advanced Medical Solutions Group
plc is not required to comply with the Directors’ Remuneration
Report Regulations requirements under Main Market UK Listing
Rules or those aspects of the Companies Act applicable to listed
companies. The following disclosures are made voluntarily.

The Committee comprises three Non-Executive Directors
and the Chair of the Board. Biographical information on the
members is set out on pages 48 and 49. They have no personal
financial interest in decisions other than as shareholders, no
conflict of interest from cross-Directorships and no day-to-day
involvement in running the business. They do not participate
in bonus, share option or pension arrangements.

On behalf of the Board, the Committee, in consultation
with the Chief Executive Officer, determines the policy for
Directors’ remuneration and setting remuneration for the
Company’s Chair and Executive Directors and Senior
Management, including the Company Secretary, and
recruitment at SMT level or for other senior roles where
shares are included in the joining package.

The Committee administers the share option schemes,
determines the design of performance-related pay schemes,
sets targets and approves payments under such schemes. The
Board has accepted the Committee’s recommendations in full.
The Terms of Reference of the Committee are available on the
Company’s website www.admedsol.com.

The activities the Remuneration Committee undertook in 2022 were:

Month

Principal activities

February

October

• Review of 2021 personal objectives and implications for Bonus and Deferred Annual Bonus awards.
• Discussion on 2022 personal objectives for the Executive Directors and review of 2022 Corporate Objectives.
• Review and ratification of amended 2022 annual bonus scheme.
• Review of 2022 LTIP and share option awards for 2022 (Executive Directors, SMT and key employees).
• Review of Gender Pay Gap Report.
• Decision on how to run the Share Incentive Plan in 2022 and set investment limits.
• Reviewed progress of 2022 personal objectives for Executive Directors.
• Reviewed status of 2022 bonus.
• Review of compliance with Executive Shareholding Policy.
• Renewal of Executive Shareholding Policy and Good Leaver Delegation Policy.
• Cost-of-Living and 2023 Budget planning discussion.

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Month

Principal activities

December

• Discussed 2023 salaries for the Executive Directors, SMT and workforce overall.
• Discussed implications of the cost-of-living increase for 2023.
• Initial review of achievement of 2022 personal objectives and Corporate Objectives.
• Discussion regarding 2023 personal objectives for Executive Directors.
• Review of results of Committee Self Assessment questionnaire.
• Reviewed Terms of Reference, Directors’ Expenses Policy and 2023 Remuneration Committee Meeting dates.

Remuneration Policy
The objective of the Policy is to attract, retain and motivate
management of the calibre required to develop and implement
the strategy and enhance earnings over the long-term without
paying more than is necessary, having regard to views of
shareholders and other stakeholders. The choice of financial,
non-financial and strategic measures is important, as is the
exercise of independent judgement and discretion when
determining remuneration awards, taking account of Group
and individual performance and wider circumstances. The
Policy aims to conform to best practice as far as reasonably
practicable and the Committee retains the right to exercise
discretion. In 2022 the Policy included criteria related to
ESG which will increasingly be a key component of
Executive Director remuneration moving forward
in line with market practice.

There are four key aspects to the Policy:

• Strategically aligned – Aligned with our strategy and culture.

Share ownership drives the right long-term behaviour.
Executive Directors and Senior Management are required to
build a significant shareholding aligning their interests with
the stakeholders’ interests. Design of long-term incentives
will be prudent and will not expose shareholders to
unreasonable financial risk.

• Pay for performance – Senior Management remuneration

promotes long-term success and reward value creation for
our stakeholders. Assessment of short-term incentives under
the Annual Performance Bonus is made against corporate,
financial, strategic and other non-financial objectives. A
proportion of the bonus is deferred for Executive Directors
and Senior Management for three-years. Long-term incentives
are linked to long-term financial and strategic objectives,
and now include a five-year total vesting and holding period.

• Market-competitive – All elements of our remuneration
are reviewed regularly to ensure they remain market-
competitive to attract and retain talent, as well as to
avoid excessive overpayment.

• Employee commitment – We are committed to paying our
people fairly and in a clear, transparent and simple way.

The Policy supports strategy and promotes long-term
sustainable success. Executive remuneration is aligned to
strategy and performance and the Care, Fair, Dare values are
linked to the delivery of this long-term strategy. The Policy
enables the use of discretion to override formulaic outcomes
and to withhold sums or share awards under appropriate
specified circumstances. In considering reward elements,
account will be taken of both Group performance and
the performance of each individual Executive Director.
Discretion can also be used when making grant awards.

The Committee appointed Ellason LLP in 2021 to provide
independent advice on the remuneration of Executives,
Non-Executive Directors and SMT. Details of the work carried
out by Ellason are set out below. Executive Director remuneration
consists of basic salary, bonus, LTIPs, health and insurance
benefits, and pension contributions. A balance between fixed
and performance-related remuneration elements is maintained.

Enhanced shareholding guidelines
Executive Directors and Senior Management are expected to
accumulate and maintain a significant shareholding. The holding
requirements for the Executive Shareholding Policy are 200%
and 100% of salary respectively for the Executive Directors and
Senior Management in order to align their interests with our
stakeholders and encourage share ownership. All Executive
Directors and SMT members met or exceeded the
shareholding target in 2021, except for three SMT members
who have been with the Company for less than five years.
If a SMT member does not comply at the end of the five-year
period the Committee retains discretion to decide on any
sanction, which may include a simple ‘warning’ or a reduction
in the next LTIP grant or bonus opportunity.

Ellason LLP were not engaged in 2022 to provide guidance.
Ellason are the only advisor who provide material assistance to
the Committee:

Advisors

Ellason LLP

Fees for Committee assistance

£Nil (2021: £18,312)

Consideration of employment conditions elsewhere
in the Group
The Committee considers the general basic salary increase
for the broader employee population when determining
the annual salary increases and remuneration of Executive
Directors. The cost-of-living increase for the 2022 financial
year was 4% for the SMT and the broader employee
population, which took effect from 1 January 2022.
Additionally, the Group awarded a small number of merit-
based increases over and above this cost-of-living increase
to employees at various levels of the organisation. Details
of the increases awarded to Executive Directors are set out
above. Non-Executive Director fees were also increased by 4%.
Details of these increases are provided below. The Committee
will continue to review Executive Director and Non-Executive
Director salaries against industry benchmarks during 2023.

In the second half of 2022, AMS started to provide additional
financial support to its lower-paid employees across the
Group to help them to cope with the cost-of-living crisis.
This support has continued in 2023.

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Statement of voting at Annual General Meeting (AGM)
At the 2022 AGM the percentages of votes cast ‘for’, and ‘against’ in respect of the Directors’ Remuneration Report were:

Resolution

Number of shares voted

Votes cast ‘for’

Votes cast ‘against’

To approve the Directors’ Remuneration Report

121,168,966

99.02%

0.98%

Overview of Director and Senior Management Remuneration Policy

Element of
remuneration

Base salary

Purpose and how it
supports strategy

To provide competitive
fixed remuneration.

To attract, retain and motivate
Executive Directors and Senior
Management of the right calibre
to deliver the Company’s
strategy and to provide a core
level of reward for the role.

How the element operated and maximum opportunity

In line with the Policy salary levels are set
taking into account experience, responsibilities
and performance, both from an individual and
business perspective and from utilising
external market data (benchmarking).

Salaries are reviewed annually. Changes
are usually effective from 1 January. Current
salaries of the Executive Directors are set out
on page 66. A review was last carried out in
December 2022.

Benefits

Annual
Performance
Bonus

To provide a competitive level
of benefit provision.
To drive and reward
performance against annual
financial and operational goals
which are consistent with the
medium to long-term strategic
needs of the business.

Deferred
Annual
Bonus (DAB)

Provides mechanism to exercise
malus provisions.

Share
Incentive
Plan (SIP)
(previously
DSB)

To align the interests of all
employees with shareholders,
incentivise long-term value
creation and act as a
retention tool.

Executive Directors and their families receive
private medical insurance. No maximum cost.
Executive Directors are entitled to receive an
Annual Performance Bonus to be determined
by the Committee based on the Group’s
financial performance and the achievement of
specific personal targets set by the Committee.

There is no financial underpin, which allows
the Committee a greater level of discretion
when determining the payment of a bonus
in respect of personal objectives.

The maximum percentages of salary
achievable are set out on page 72.

The DAB requires Executive Directors and
SMT to defer up to 25% of their Annual
Performance Bonus for three years.

The DAB includes malus provisions which
are laid out on page 71. Clawback provisions
also apply to the DAB.
The SIP is available to all employees and allows
investment of bonus and/or salary into shares.
It also allows for the provision of matching
(free) shares if the shares are held for a
set period.

Framework used to
assess performance

Where there is a change
in responsibility,
progression in the role,
change in size or
structure of the Group or
increased experience of
the Executive Director
or member of Senior
Management, the
Committee retains the
discretion to award
a higher increase than
the standard increase
for the UK workforce.
N/A

Both financial and non-
financial measures are
used for Executive
Directors,. Financial
targets are set against
Group revenue (35%),
PBT (35%) and personal
objectives (30% based on
non-financial objectives,
including ESG and Care,
Fair, Dare values).

Business need may alter
future bonus measures
or weightings.
N/A

N/A

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Framework used to
assess performance

No shares shall vest from
the proportion of the
Award determined by
reference to the AIM
Healthcare Share Index
if the Company is ranked
below median. Awards
vest on a sliding scale
from 25% to 100% for
performance from
median to upper quartile.

Performance against
EPS will be based on
the percentage increase
in the Group’s EPS over
a three-year period
commencing on
1 January of the year
in which the Award is
made. Awards vest on
a sliding scale from 25%
to 100% for an average
annual EPS growth rate
over the vesting period
of a minimum of 5%
rising to 20%. No awards
will be made for an
average annual growth
rate below the 5%.

The Committee has
flexibility to make
adjustments to
performance conditions
to ensure the Award
achieves its purpose.
Vesting is subject to
the Committee being
satisfied that the Group’s
performance on these
measures is consistent
with the performance
of the business.
N/A

Element of
remuneration

Long-Term
Incentive
Plan (LTIP)

Purpose and how it
supports strategy

To align the interests of the
Executive Directors and SMT
with shareholders and to
incentivise long-term
value creation.

How the element operated and maximum opportunity

The LTIP permits an annual grant that vests
subject to performance and employment.

Under LTIP rules, the maximum annual award
is 200% of salary. Details of the award levels
for 2022 are set out below. Awards under the
LTIP may be granted in the form of nil-cost
options or cash (where they cannot be settled
in shares). Awards have a £1 consideration.

50% of the vesting is based on the Total
Shareholder Return (TSR) performance
compared with the AIM Healthcare Share
Index over the three-year period and 50%
of the vesting is determined by the growth
in the average Earnings Per Share (EPS) per
year of the Group over a three-year period.
The calculation analyses the 90 dealing-day
period to the date of grant measured against
the 90 dealing day period prior to the three-
year anniversary following the date of grant.

The 2014 LTIP scheme introduced malus
provisions which are laid out below. The
scheme has also been revised to allow
for clawback provisions.

Pension

To provide a market competitive
remuneration package to
enable the recruitment and
retention of Executive Directors
and Senior Management.

Executive Directors contribute up to 10% of
salary into a defined contribution plan with the
Group contributing a fixed 10%. All other UK
employees contribute a minimum of 3% which
is matched by a Company contribution of 6%.
An employee may substitute pension
contributions for salary if they are impacted by
limitations on the size of individual personal
pension funds.

It is intended that any new Executive Directors
will have a pension in line with the workforce.

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Malus and clawback provisions – 2014 LTIP/DAB
The 2014 LTIP and DAB incorporate malus provisions. The Committee may, in its absolute discretion, resolve to vary an Award
in the event that any of the Financial Statements or results for the Company, or for any Group Company, are materially restated
(other than restatement due to a change in accounting policy or to rectify a minor error) or if, in the reasonable opinion of the
Committee and following consultation with the relevant employing Group Company, a participant has deliberately misled the
management of the Company and/or the market and/or the Company’s shareholders regarding the financial performance of
any Group Company or any Subsidiary, or a participant’s actions amount to serious misconduct or conduct which causes
significant financial loss for the Company, any Group Company and/or the participant’s Business Unit. If it is determined that
the malus provision applies then the number of shares comprised in an Award that are not vested and/or vested shares in the
case of an unexercised Option should be reduced (to Nil if appropriate). Following the consultation with shareholders during
the year, the Committee has agreed to incorporate clawback provisions into DAB and LTIP awards from 2022. These would
allow for clawback of previously granted Awards in the same circumstances as set out above.

Directors emoluments – single figure of remuneration (2021 and 2022)

Salary and fees

Annual
Performance
Bonus

Deferred
Bonus

LTIPs vested1

Gains on
SIP vested1

Benefits

Pensions

Total
remuneration

Chris Meredith
Eddie Johnson
Peter Allen
Penny Freer2
Grahame Cook
Douglas Le Fort
Liz Shanahan

339
218
94
27
53
48
18

329
192
83
49
44
18
–

Total

797 7373

218
95
–
–
–
–
–

313

150
45
–
–
–
–
–

195

73
32
–
–
–
–
–

19
6
–
–
–
–
–

112
24
–
–
–
–
–

105

136

–
–
–
–
–
–
–

–

55
20
–
–
–
–
–

11
37
–
–
–
–
–

1
1
–
–
–
–
–

34
22
–
–
–
–
–

33
19
–
–
–
–
–

832
412
94
27
53
48
18

543
300
83
49
44
18
–

52 1,484 1,0593

1 Gains on SIPs vested is based on the share price at vesting date. Details of the SIP can be found on page 69.

2 Penny Freer retired on 8 June 2022.

Includes £22,000 of fees paid to Steve Bellamy prior to his retirement on 8 June 2021.

The table above summarises the payments made and amounts earned by the Executive and Non-Executive Directors for the 2021
and 2022 financial years. The fees for the Chair of the Audit Committee and Remuneration Committees (Grahame Cook and
Douglas Le Fort) include a fee of £8,000 for chairing a Committee and a £3,000 fee for the Senior Independent Director
(Grahame Cook – previously no fee). The Executive Directors were granted LTIPs as detailed on page 72. All Directors
have confirmed that they have not received remuneration save as disclosed above.

Salaries and fees
Details of 2022 salaries for the Executive Directors are outlined on page 66 and for the prior year in the table above.

Annual Performance Bonus and Deferred Annual Bonus
Details of the Annual Performance Bonus and Deferred Annual Bonus are outlined on page 69.

The personal objectives for the Executive Directors for the year ended 31 December 2022 included progress in new product
launches, development of the SMT and progress with the successful integration of recent acquisitions. The table below
summarises 2022 performance against the targets:

Performance measures

Group Revenue
Adjusted Profit Before Tax

Personal objectives/values assessment

Total

Weighting

35%
35%

30%

100%

Threshold
£m

Target
£m

Stretch
£m

Achievement
£m

114.4
28.6

120.4
28.6

126.4
29.9
Committee assessed that the
Executive Directors achieved
90% of their objectives

2022 result
(% of
maximum)

31%
0%

124.3
28.5

90%

27%

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The bonus for 2022 is payable in April 2023, as a % of salary is:

Director

Chris Meredith
Eddie Johnson

Revenue

46%
31%

PBT

0%
0%

Objectives

Total %

41%
27%

87%
58%

2023 objectives are commercially sensitive and not detailed in this Report.

2022 bonus payments in respect of 2021 were as follows:

Director

Chris Meredith
Eddie Johnson

Bonus paid
in 2022
(FY 2021)

£150,152
£45,099

Percentage
of salary
(total bonus)

Maximum %
of salary

48.3%
24.2%

150%
100%

Deferred

£18,902
£5,724

Vesting of LTIPs for the year ended 31 December 2022
Details of the LTIP performance conditions for the LTIPs granted on 24 April 2019, which produced a 21.2% vesting result on
24 April 2022, are shown on page 66.

Directors’ interests in the LTIP
On 14 April 2022 the Committee approved LTIP awards as outlined below.

Director

Chris Meredith
Eddie Johnson

Type of award

Basis of grant awarded

Share price at
date of grant
(£)

Number of
shares granted

Face value
of grant

Vesting
determined by
performance
over 3 years

Nil-cost option
Nil-cost option

200% of salary
125% of salary

3.039
3.039

239,552
89,832

£727,999 See page 70
£272,999 See page 70

Outstanding Share Awards – Maximum under the LTIP

Director

Chris Meredith

Eddie Johnson

As at 1 January
2022

Exercised in
the year

Issued in
the year

Lapsed in
the year

As at 31
December
2022

Market price
at grant date
(p)

First vesting date

146,939
129,628
80,096
182,510
254,812
238,963
–
34,235
28,126
17,379
38,783
72,197
67,706
–

146,939
129,628
80,096
38,692
–
–
–
–
–
–
–
–
–
–

–
–
–
–
–
–
239,552
–
–
–
–
–
–
89,832

–
–
–
143,818
–
–
–
–
–
–
30,562
–
–
–

–
–
–
–
254,812
238,963
239,552
34,235
28,126
17,379
8,221
72,197
67,706
89,832

151.50 10 September 2018 (vested)
18 April 2019 (vested)
184.60
6 April 2020 (vested)
246.69
24 April 2022 (vested)
328.75
14 April 2023
239.00
23 April 2024
257.40
14 April 2025
303.90
2 April 2018 (vested)
132.00
18 April 2019 (vested)
184.60
6 April 2020 (vested)
246.69
24 April 2022 (vested)
328.75
14 April 2023
239.00
23 April 2024
257.40
14 April 2025
303.90

Chris Meredith exercised 395,355 LTIPs in 2022 (2021: Nil). Eddie Johnson exercised Nil LTIPs in 2022 (2021: Nil). Awards have
no performance re-testing facility.

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Approach to remuneration of Executive Directors at the time of recruitment
When appointing an Executive Director the Committee may utilise all existing remuneration components. Salary will reflect
experience, skills, market data and current salary. They will be eligible for a personal pension, medical insurance and share
schemes. In line with the Code, it is the intention that pension contributions will be set at a rate available to the wider
workforce in respect of future Executive Director appointments.

Non-Executive Directors
Non-Executive Directors are appointed under arrangements that may be terminated by either party on six months’ notice. Their
fees are determined by the Executive Directors, taking into account the time and responsibility of the role. They receive travel
expenses, do not participate in incentive arrangements and have confirmed they have not received any other remuneration
in 2022 save as disclosed on page 71. Further details of Non-Executive Director fees are below:

Element of remuneration

Non-Executive
Director Fees.

Purpose and how it
supports strategy

Reflects time
commitments and
responsibilities of
each role.

How the element operated and maximum opportunity

Framework used to assess
performance

There is no maximum annual increase. The Board is
guided by the market and broader employee population.
On occasion they may need to recognise an increase
in the scales or scope of the role. Fees were increased
by 4% in 2022, in line with the workforce.

Non-Executive Directors do
not participate in variable
pay arrangements and do
not receive retirement
benefits.

Service agreements
Executive Director service contracts are not fixed term, are terminable by either party giving not less than 12-months’ written
notice and can be viewed at the Company’s registered office and at the AGM. The Committee reviews the contractual terms
for new Executive Directors to ensure they reflect best practice. Details of the service contracts are as follows:

Date of contract

Unexpired term (months) or rolling contract

Notice period
(months)

Executive Director
Chris Meredith
Eddie Johnson

Non-Executive Directors
Peter Allen
Grahame Cook
Douglas Le Fort
Liz Shanahan

1 July 2005 (updated 1 July 2021)
1 January 2019 (updated 1 July 2021)

Rolling contract
Rolling contract

4 December 2013
1 February 2021
2 August 2021
1 August 2022

Rolling contract
Rolling contract
Rolling contract
Rolling contract

12
12

6
6
6
6

Policy on Payment for Loss of Office – Executive Directors
The Committee considers individual cases of early termination and determines compensation on a case-by-case basis. There
are no special provisions in the event of loss of office or for Payment in Lieu of Notice (PILON). If such circumstances were to
arise, the Executive Director would have no claim against the Company for damages or any other remedy in respect of the
termination. The Committee would apply principles of mitigation to any payment made to a departing Executive Director.

Whilst the Committee retains overall discretion for ‘Good Leaver’ status, it typically defines a ‘Good Leaver’ for the Annual
Performance Bonus and 2014 LTIP as retirement, ill health or injury, disability, redundancy or the employing Company ceasing
to be under the control of the Group. The 2014 DAB defines a ‘Good Leaver’ as ceasing to be a Director or employee of a Group
Company where that individual is not a ‘Bad Leaver’. A ‘Bad Leaver’ is defined as a Director or employee leaving the business due
to the Financial Statements requiring restatement. Final treatment is subject to the Committee’s discretion.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

r eM U Ne rA T I O N C O M M I T Te e r eP OrT CO N T I N U E D

No payments were made to past Directors or for loss of office during the year ended 31 December 2022.

Timing of vesting/award

Calculation of vesting/payment

Annual Performance Bonus payment would be
negotiated as part of the leaving arrangements (at
the discretion of the Remuneration Committee).

No automatic entitlement to Annual Performance
Bonus on a pro-rata basis – it is at the discretion
of the Remuneration Committee.

Event

Bonus/DAB
Good Leaver

Bad Leaver

Change of Control

LTIP
Good Leaver

Unvested Deferred Annual Bonus share awards
vest at the normal vesting date (or earlier at the
Remuneration Committee’s discretion).
Not applicable.

Annual Performance Bonuses are paid and
unvested Share Incentive Plan shares vest
on the date of change of control notification
to the Executive Directors.

On normal vesting date (or earlier at the
Remuneration Committee’s discretion).

Individuals lose the right to their Annual
Performance Bonus and unvested Deferred
Annual Bonus shares.
Annual Performance Bonus is paid to the extent
that performance conditions have been satisfied
and are pro-rated to the effective date of change
of control.

Unvested awards vest to the extent that
performance conditions have been satisfied and
are reduced pro-rata to account for any part of
the vesting period remaining.
Unvested awards lapse on cessation of
employment.
Unvested awards vest and a pro-rata reduction
applies for the proportion of the vesting period
not served.

Bad Leaver

Change of Control

Unvested awards lapse on cessation of
employment.
Unvested awards vest on the date of notification
to the Executive Directors regarding the change
of control.

Upon a Director’s exit or a change of control situation, Share Incentive Plan awards will be treated in line with the plan rules.
If employment is terminated by the Company, an Executive Director may have a legal entitlement to additional amounts, which
would need to be met. The Committee retains discretion to settle other amounts reasonably due to the Executive Director.

The Committee may approve new contractual arrangements with departing Executive Directors including (but not limited to)
settlement and/or consultancy arrangements which will be used sparingly and only where it is in the best interests of the
Company and shareholders. There are no agreements between the Group and its Directors or employees for loss of office or
employment (whether through resignation, purported redundancy or otherwise) which may occur as a result of a takeover bid.

Statement of Directors’ shareholdings and share interests

Director

Chris Meredith
Eddie Johnson
Peter Allen
Grahame Cook
Douglas Le Fort
Liz Shanahan2
Penny Freer (retired 8 June 2022)

Beneficially
owned1 at
31 December
2021

1,528,893
141,648
50,000
Nil
Nil
Nil
13,888

Beneficially
owned1 at
31 December
2022

Outstanding
LTIP awards at
31 December
2022

Outstanding
DAB awards at
31 December
2022

Outstanding
share awards
under SIP at
31 December
2022

Shareholding as
a % of issued
Share Capital at
31 December
2022

1,748,478
157,742
50,000
Nil
Nil
Nil
–

733,327
317,696
–
–
–
–
–

6,219
12,737
–
–
–
–
–

116,578
56,170
–
–
–
–
–

0.81%
0.07%
–
–
–
–
–

Includes all shares beneficially held by the Executive Director (or their spouse and children) and vested SIPs.

2 Liz Shanahan holds 4,444 shares through her PCA’s at 18 April 2023.

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Executive Directors are required under the Executive Shareholding Policy to hold shares equivalent in value to 200% of pre-tax
annual salary. Compliance with this policy as at 31 December 2022 is shown below, using the share price at that date:

Director

Chris Meredith
Eddie Johnson

Shares
held*

1,690,912
25,732

Vested
SIPs

61,581
112,817

LTIP (50%
of vested/
unexercised
LTIPs)

-
43,981

DAB
awards

6,219
12,737

Total
shares

Shareholding
target
(£)

Shareholding
value
(£)

1,758,712
195,267

£728,000 £4,625,613
£513,551
£436,800

% holding
vs target

635%
118%

Includes all shares beneficially held by the Executive Director (or their spouse and children).

CEO total remuneration
The total remuneration figure for the Chief Executive Officer during each of the last five financial years is shown below.

Total remuneration includes salary, Annual Performance Bonus, gains on SIPs in that year and LTIP awards vesting in the year.
The Annual Performance Bonus and LTIP vesting level as a percentage of the maximum opportunity is given for each year.

Year ended 31 December

Total remuneration (£’000)
Annual Performance Bonus (% of maximum)
LTIP vesting (% of maximum)

Relative importance of spend on pay

Year ended 31 December

Staff costs
Dividends*
Tax
Profits for year attributable to owners of the Parent

* The dividend figures relate to amounts payable in respect of the prior year.

2018

896
50.6%
87.3%

2019

770
0%
90.3%

2020

537
0%
73.1%

2021
(£m)

39.7
3.8
4.5
17.5

2021

543
32.2%
0%

2022
(£m)

46.1
4.3
5.5
20.4

2022

832
57.8%
21.2%

Change
%

16%
13%
22%
17%

£1,960,000 (2021: £1,572,000) of staff costs relate to pay for the Directors, of which £1,185,000 relates to the highest paid
Director (2021: £965,000). Total pension contributions were £1,497,000 (2021: £1,407,000) and for the highest paid Director
£34,000 (2021: £33,000).

During 2022, distributions to shareholders included a dividend of £2,960,000 paid on 17 June 2022 (2021: £2,579,000) and
£1,381,000 paid on 21 October 2022 (2021: £1,266,000). It is proposed that a dividend of 1.51p per share be paid on 9 June
2023. Further details are provided in Note 14 on page 105.

Private healthcare
Executive Directors and other senior employees are entitled to private healthcare and permanent health insurance.

Share options
Employees may be granted share options under the 2019 Share Option Plan (GSOP). Options granted under the GSOP are not
offered at a discount. The exercise of options is conditional on performance conditions, normally after the third anniversary of
the date of grant and no later than the tenth anniversary of grant. Full details are included in Note 29 on pages 116 to 121.

The GSOP allows employees to be granted approved or unapproved options. Under the approved part of the GSOP, UK
employees can receive up to £30,000 worth of shares by market value of the shares on the grant date and benefit from the
growth in value of those shares. This limit increased to £60,000 in April 2023.

Share performance – 2022
The opening share price for 2022 was 335p and the closing price, on the last trading day of the year, was 263p. The range
during the year was 335p (high) and 235p (low) (Source: Daily Official List of the London Stock Exchange).

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

D Ir eC T OrS ’ r eP OrT
For the year ended 31 December 2022

This Directors’ Report includes disclosures required under the Companies Act 2006, the Large and Medium-sized Companies
and Groups (Accounts and Reports) Regulations 2008 and the 2018 UK Corporate Governance Code (Code). Additional
information can be located as follows:

Disclosure

Location

Principal activities, business review and future developments
Results
Corporate Governance
Directors’ remuneration including Directors’ interest in the
share capital of the Company
Principal Risks and Uncertainties
Financial instruments and risk management

Research and development activities

Shareholder, employee and stakeholder engagement
Environmental, Social and Governance, Health and Safety and
Streamlined Energy and Carbon Reporting (SECR) report
Key Performance Indicators
Company’s capital structure

Long Term Incentive Plan and share schemes
Events after the balance sheet date
Significant subsidiary undertakings
Non-Financial Reporting Statement

Throughout the Strategic Report – pages 6 to 47
Financial Statements – pages 79 to 122
Corporate Governance Report – pages 52 to 57
Remuneration Committee Report – pages 65 to 75

Principal Risks and Uncertainties – pages 46 to 47
Note 24 to the Financial Statements – pages 112 to 114
and in the Strategic Report –pages 43 to 47
Strategic Report – pages 6 to 47
Financial Review on pages 40 to 42
Stakeholder Engagement Report – pages 24 to 27
ESG Report – pages 28 to 39

Key Performance Indicators – pages 18 to 19
Consolidated Statement of Changes in Equity– page 90,
Financial Statements – Note 27 on page 115
Remuneration Report – pages 65 to 75
Financial Statements – Note 32 on page 122
Financial Statements – Note 3 on page 127 to 128
Page 23

Dividends
The Group made a profit before tax for the year to 31 December
2022 of £25.9 million (2021: £22.0 million). The Directors are
recommending a final dividend of 1.51p per share (2021: 1.37p
per share). The final dividend will, subject to shareholders’
approval, be paid on 9 June 2023 to shareholders on the
register at the close of business on 19 May 2023. This would
make a total dividend of 2.15p for the full year (2021: 1.95p).
The Board will continue to review the Group’s dividend policy.

Capital Structure
The Group is cash-generative and had net cash of £82.3 million
at 31 December 2022 and the potential for significant debt
funding with its banks (NatWest and HSBC). Ordinary Shares
are admitted to, and traded on, the Alternative Investment
Market (AIM), a market operated by the London Stock Exchange.
Further information regarding the Company’s share capital,
including movements during the year, are set out in Note 27
to the Financial Statements on page 115.

Events after the Reporting Date
Since the date of the balance sheet, the Group has acquired
Connexicon Medical Limited, a tissue adhesive technology
specialist headquartered in Dublin, strengthening its position in
the $300 million global tissue adhesive market, expanding its
product portfolio and significantly enhancing its technical and
R&D capabilities in cyanoacrylate technology. Consideration
consists of an initial, up-front payment of €7 million with
further deferred payments dependent on the delivery of
certain research and development, regulatory and
commercial milestones between 2023 and 2027.

Going Concern
The Directors continue to adopt the Going Concern basis in
preparing the Financial Statements. Details of Going Concern
can be found on page 57 and in the Notes Forming Part of the
Financial Statements on page 92.

Creditor Payment Policy
It is the policy and normal practice of the Group to make
payments due to suppliers in accordance with agreed terms
and conditions, generally less than 60 days. Where suppliers
offer early settlement discounts, these may be taken
advantage of. This policy will also be applied for 2023.

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Share Capital and Issue of Ordinary Shares
At 31 March 2023 the Group’s issued share capital is set
out below:

Number

£’000

% of issued
Share Capital

Ordinary Shares of
5p each

216,930,785

10,847

100

Substantial Shareholdings
Details of the interests in voting rights in the Company’s shares
with substantial interests of 3% or more in the Ordinary Share
capital of the Company as at 31 March 2023, in accordance
with the Disclosure and Transparency Rules:

31 March
2023

% of issued
Share Capital

Octopus Investments Limited
Canaccord Genuity Group Inc
Charles Stanley Group
Investec Group
Blackrock Inc
Invesco
Rathbone plc
Groupama

27,408,357
15,266,626
11,315,607
10,754,571
9,189,954
8,374,461
7,993,503
6,597,623

12.63
7.04
5.22
4.96
4.24
3.86
3.68
3.04

Re-election of Directors
The Chair has determined that each Director demonstrates
commitment to their role and displays effective performance,
and is recommending the re-election of all Directors seeking
to remain on the Board. AMS has elected to comply with 2018
Code Provision 18 and therefore all Directors will retire and shall
stand for re-election at the AGM to be held on 31 May 2023.

The Board has procedures for Directors’ conflicts of interest.
Only Directors who have no interest in the matter under
consideration are able to take the relevant decision. The Board
will report annually on the Company’s procedures for ensuring
that the Board’s power of authorisation in respect of conflicts
of interest operated effectively. None of the Directors had
any conflicts of interest during or at the end of the year in
any contract relating to the business of the Company or
its subsidiaries.

Directors’ and Officers’ Liability Insurance
Insurance cover is in force in respect of the personal liabilities
that may be incurred by Directors and Officers of the Company
in the course of their service with the Group, as permitted by
the Companies Act 2006. No cover is provided in respect of
any fraudulent or dishonest act.

Employees – Equal Opportunities and Development
AMS is an equal opportunities employer committed to
eliminating all forms of discrimination and to giving fair
and equal treatment to all employees and job applicants.
An Equality, Diversity and Inclusion Policy, to reflect best
practice in this area, is in force. Further detail on this area
can be found in our ESG Report on pages 28 to 39.

Employees and other stakeholders
The Group has chosen, in accordance with Section 414(c)(ii) of
the Companies Act 2006 to set out in the Strategic Report the
following which the Directors believe to be of significant
importance:

• Review of the business;

• Relevant aspects of Section 172 statement (Sch 7.11(1)(b);

and

• Employee engagement and Sch 7.11B(1) – Business

relationships).

Further policies relating to employees are discussed in the
ESG section of the Strategic Report. See pages 24 to 27 for
disclosure of employee engagement and other stakeholder
engagement statements.

Political Donations
In line with the established policy, the Group made no
political donations.

Annual General Meeting
The AGM will be held at 11.00am on 31 May 2023. Further
details are outlined in the AGM Notice, which is a separate
circular to shareholders.

Directors’ Responsibilities Statement
The Directors are responsible for preparing the Annual Report
and Financial Statements in accordance with applicable law
and regulations.

Company law requires the Directors to prepare Financial
Statements for each financial year. Under that law the
Directors are required to prepare the Group Financial
Statements in accordance with International Financial
Reporting Standards (IFRS) as adopted by the European
Union and Article 4 of the International Accounting Standard
Regulations and have elected to prepare the Parent Company
Financial Statements in accordance with United Kingdom
Generally Accepted Accounting Principles (United Kingdom
Accounting Standards and applicable law), including FRS 101
‘Reduced Disclosure Framework’). Under company law the
Directors must not approve the accounts unless they are
satisfied that they give a true and fair view of the state of
affairs of the Company and of the profit or loss of the
Company for that period.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

D Ir eC T OrS ’ r eP OrT CO N T I N U E D

In preparing the Parent Company Financial Statements
the Directors are required to:

Responsibility Statement
We confirm that to the best of our knowledge:

• select suitable accounting policies and then apply

them consistently;

• make judgements and accounting estimates that are

reasonable and prudent;

• state whether applicable UK Accounting Standards have

been followed, subject to any material departures disclosed
and explained in the Financial Statements; and

• prepare the Financial Statements on the Going Concern

basis unless it is inappropriate to presume that the
Company will continue in business.

In preparing the Group Financial Statements, International
Accounting Standard 1 requires that Directors:

• properly select and apply accounting policies;

• present information, including accounting policies, in
a manner that provides relevant, reliable, comparable
and understandable information;

• provide disclosures when compliance with specific

requirements in IFRS is insufficient to enable users to
understand the impact of particular transactions, other
events and conditions on the entity’s financial position
and financial performance; and

• assess the Group’s ability to continue as a Going Concern.

The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Company’s
transactions and disclose with reasonable accuracy, at any
time, the financial position of the Company and enable them
to ensure that the Financial Statements comply with the
Companies Act 2006. The Directors are also responsible
for safeguarding the assets of the Company and hence for
taking reasonable steps for the prevention and detection
of fraud and other irregularities.

The Directors are responsible for the maintenance and
integrity of the corporate and financial information included
on the Company’s website. Legislation in the United Kingdom
governing the preparation and dissemination of Financial
Statements may differ from legislation in other jurisdictions.

• the Financial Statements, prepared in accordance with the
relevant financial reporting framework, give a true and fair
view of the assets, liabilities, financial position and profit or
loss of the Company and the undertakings included in the
consolidation taken as a whole;

• the Strategic Report includes a fair review of the

development and performance of the business and the
position of the Company and the undertakings included
in the consolidation taken as a whole, together with
a description of the principal risks and uncertainties
that they face; and

• the Annual Report and Financial Statements, taken as a

whole, are fair, balanced; and understandable and provide
the information necessary for shareholders to assess the
Group’s performance, business model and strategy.

Provision of Information to the Independent Auditors
Each of the persons who is a Director at the date of approval
of this Annual Report confirms that:

• so far as the Director is aware, there is no relevant audit

information of which the Company’s Auditor is unaware;
and

• the Director has taken all the steps that he/she ought to
have taken as Director in order to make himself/herself
aware of any relevant audit information and to establish
that the Company’s Auditor is aware of that information.

This confirmation is given and should be interpreted in
accordance with the provisions of Section 418 of the
Companies Act 2006.

Independent Auditors
Deloitte LLP has expressed their willingness to continue in
office as Auditor and a resolution to re-appoint them will
be proposed at the forthcoming Annual General Meeting.

The Directors’ Report has been approved by the Board
and authorised for issue and is signed on its behalf by:

Owen Bromley
Company Secretary
18 April 2023

Advanced Medical Solutions Group plc Annual Report & Accounts 2022

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I N DePeN DeN T A U D I T Or
to the members of Advanced Medical Solutions Group Plc

’ S r eP OrT

Report on the audit of
the financial statements

1. Opinion

In our opinion:

• the financial statements of Advanced Medical Solutions Group plc (the ‘parent company’) and its subsidiaries (the ‘group’)
give a true and fair view of the state of the group’s and of the parent company’s affairs as at 31 December 2022 and of
the group’s profit for the year then ended;

• the group financial statements have been properly prepared in accordance with United Kingdom adopted international

accounting standards;

• the parent company financial statements have been properly prepared in accordance with United Kingdom Generally

Accepted Accounting Practice, including Financial Reporting Standard 101 “Reduced Disclosure Framework”; and

• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

We have audited the financial statements which comprise:

• the Consolidated Income Statement;

• the Consolidated Statement of Comprehensive Income;

• the Consolidated and Parent Company Statements of Financial Position;

• the Consolidated and Parent Company Statements of Changes in Equity;

• the Consolidated Statement of Cash Flows;

• the related Consolidated Financial Statement notes 1 to 32; and

• the related Parent Company Financial Statement notes 1 to 7.

The financial reporting framework that has been applied in the preparation of the group financial statements is applicable law
and United Kingdom adopted international accounting standards. The financial reporting framework that has been applied in
the preparation of the parent company financial statements is applicable law and United Kingdom Accounting Standards,
including FRS 101 “Reduced Disclosure Framework” (United Kingdom Generally Accepted Accounting Practice).

2. Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further described in the auditor’s responsibilities for the audit of the financial
statements section of our report.

We are independent of the group and the parent company in accordance with the ethical requirements that are relevant to our
audit of the financial statements in the UK, including the Financial Reporting Council’s (the ‘FRC’s’) Ethical Standard as applied
to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

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3. Summary of our audit approach

Key audit matters

The key audit matters that we identified in the current year were:

• Revenue recognition

• Acquisition accounting

Within this report, key audit matters are identified as follows:

Newly identified

Similar level of risk

Materiality

Scoping

The materiality that we used for the group financial statements was £1.3m which was determined on the
basis of 5% of pre-tax profit.

We focused our group audit scope on Advanced Medical Solutions Limited (UK) and Resorba Medical
GmbH (Germany) subject to a full scope audit, and Advanced Medical Solutions BV (Netherlands),
Biomatlante SA (France), Advanced Medical Solutions Israel (Sealantis) Limited (Israel) and Raleigh
Adhesive Coatings (UK) subject to specified procedures. As a consequence of the audit scope
determined, we achieved coverage of approximately 85% of revenue, 91% of profit before tax
and 99% of net assets.

Significant changes
in our approach

The following changes to our approach occurred this year:

• We no longer consider the carrying value of goodwill to be a key audit matter given the levels of

headroom in the impairment test models; and

• Added the key audit matter of acquisition accounting given the acquisition of AFS Medical GmbH

in the year.

4. Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of accounting in the
preparation of the financial statements is appropriate.

Our evaluation of the directors’ assessment of the group’s and parent company’s ability to continue to adopt the going concern
basis of accounting included:

• obtaining an understanding and corroborating the available, uncommitted, financing facilities including nature of the facilities,

repayment terms and covenants;

• linking the assessment and the forecasts to the business model and medium-term risks;

• assessing the reasonableness and appropriateness of the assumptions used in the forecasts;

• corroborating the amount of headroom in the forecasts;

• evaluating the appropriateness of, and headroom within, the sensitivity analysis; and

• assessing the sophistication of the model used to prepare the forecasts, testing of clerical accuracy of those forecasts and

assessing the historical accuracy of forecasts prepared by management.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the group’s and parent company’s ability to continue as a going
concern for a period of at least twelve months from when the Financial Statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections
of this report.

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5. Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to
fraud) that we identified. These matters included those which had the greatest effect on: the overall audit strategy, the allocation
of resources in the audit; and directing the efforts of the engagement team.

These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these matters.

5.1. Revenue recognition

Key audit matter
description

The Group sells medical devices across a number of geographical regions generating revenue of £124.3
million (2021: £108.6 million).

The timing of when revenue is recognised is relevant to the reported performance of the Group.
There is a risk of material misstatement due to error or fraud as a result of misstating the allocation of
revenue between periods. This timing of revenue recognition, in particular around year end, is a focus
for material Group revenue streams. Pressures to meet stakeholder expectations could provide
incentives to record revenues where control has not passed.

We have specifically focused this key audit matter on cut-off and occurrence of revenue recorded
within November and December 2022 and January 2023. We have also considered other one-off
material revenue transactions based on our understanding of monthly peaks in sales reported and
the associated credit terms with those, and other major, customers.

The associated disclosure is included within Note 4 to the Financial Statements. For specific detail
on the Group’s accounting policy, see Note 3 to the Financial Statements.

How the scope
of our audit
responded to the
key audit matter

We obtained an understanding of the relevant controls over the revenue process.

We tested a sample of individual sales transactions and traced to despatch notes, including
consideration of the specific shipping terms attached to the sale, and subsequent cash receipt or
other supporting documents.

We performed a detailed analysis of revenue trends within each business unit including:

• inquiry of management and obtaining evidence of management reviews of actual revenue to budget;

and

• performing enquiries of management and key members of the commercial team to identify any key

changes to sales terms in force compared to the previous year.

To evaluate cut off and occurrence of revenue within the risk period:

• we identified the population upon which a risk of material misstatement could be likely and for the
population identified we evaluated a sample of sales transactions to despatch record to confirm
timing and occurrence of the transaction;

• we reviewed material journal amounts to revenue within the current year risk period and assessed

reasonableness;

• we interrogated revenue transactions outside non standard shipping revenue streams;

• we interrogated and analysed any credit notes post year end which may contradict occurrence of

revenue; and

• we analysed the receivables ledgers at year end and post year end to identify and interrogate any

material overdue debts.

Key observations

Based on the work performed we concluded that revenue has been recognised appropriately.

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’ S r eP OrT CO N T I N U E D

5.2. Acquisition accounting

Key audit matter
description

How the scope
of our audit
responded to the
key audit matter

During the year, the Group acquired the entire issued share capital of AFS Medical GMBH. Accounting for
acquisitions under IFRS 3 Business Combinations is complex as management are required to separately
identify and value the intangible assets acquired. This involves a high level of estimation uncertainty,
particularly with regards to valuation model inputs such as forecast cash flows and discount rates,
hence management engaged a third party expert to support. The acquisition resulted in £3.9m of
separately identifiable intangible assets and £1.5m of goodwill.

The associated disclosure is included within Note 31 to the Financial Statements. For specific detail on
the Group’s accounting policy, see Strategic Report on page 11 and Note 3 to the Financial Statements.

We obtained an understanding of the relevant controls over acquisition accounting.

We reviewed the sale and purchase agreement, other transactional documentation and third party
purchase price allocation reports to evaluate the goodwill and intangible assets recognised and to
corroborate the consideration paid.

With the involvement of internal specialists, we evaluated the valuation techniques and the
reasonableness of assumptions applied and challenged the appropriateness of the discount rate
and valuation model used. Together with our specialists we assessed the reasonableness of valuation
assumptions such as discount rate, long-term growth rate and valuation multiples.

We challenged the discount rates used by independently setting expectations based on various
competitors to the Group and third party information available, such as beta values, risk-free rates
and cost of debt and premiums based on the size of the acquisition or the risk profile of the entity.

We have evaluated the competence, capabilities and objectivity of the third party expert engaged.

We have evaluated whether the policies and disclosures for acquisition accounting within the
Financial Statements are consistent with the principles of IFRS 3 Business Combinations and
have been applied appropriately.

Key observations

Based on the work performed we are satisfied that the intangible assets and goodwill generated on
acquisition have been valued appropriately. The assumptions around the growth rate, discount rate
and cash flow forecasts are reasonable.

6. Our application of materiality
6.1. materiality
We define materiality as the magnitude of misstatement in the financial statements that makes it probable that the economic
decisions of a reasonably knowledgeable person would be changed or influenced. We use materiality both in planning the
scope of our audit work and in evaluating the results of our work.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Group financial statements

Parent company financial statements

Materiality

£1.3m (2021: £1.0m)

£0.8m (2021: £0.6m)

Basis for
determining
materiality

5% of pre-tax profit

Rationale for the
benchmark applied

Profit before tax is determined to be the most
relevant performance measure to the users
of the Financial Statements

Parent company materiality is based on 2% of the
company’s net assets, however this was capped
at 90% of Group performance materiality (2021:
90% of Group materiality).

As a non-trading parent company, net assets is
the key driver of the company. We have opted
to cap parent company materiality at 90% of the
Group performance materiality, based on auditor
judgement because we consider this to better
represent the focus of the users of the
financial statements.

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PBT £25.9m

Group materiality
£1.3m

Component
materiality range
£0.5m to £0.9m

Audit Committee
reporting threshold
£0.07m

PBT

Group materiality

6.2. performance materiality
We set performance materiality at a level lower than materiality to reduce the probability that, in aggregate, uncorrected and
undetected misstatements exceed the materiality for the financial statements as a whole.

Performance
materiality

Basis and rationale
for determining
performance
materiality

Group financial statements

Parent company financial statements

70% (2021: 70%) of group materiality

100% (2021: 100%) of parent company materiality

In determining performance materiality, we considered the following factors:

• the quality of the control environment; and

• our past experience of the audit, which has indicated a low number of corrected and uncorrected

misstatements identified in prior periods.

6.3. error reporting threshold
We agreed with the Audit Committee that we would report to the Committee all audit differences in excess of £0.07m
(2021: £0.06m), as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds.
We also report to the Audit Committee on disclosure matters that we identified when assessing the overall presentation of
the financial statements.

7. An overview of the scope of our audit
7.1. identification and scoping of components
Our Group audit was scoped by obtaining an understanding of the Group and its environment, including Group-wide controls,
and assessing the risks of material misstatement at the Group level.

Based on this assessment, we focused our group audit scope on Advanced Medical Solutions Limited (UK) and Resorba Medical
GmbH (Germany) subject to a full scope audit, and Advanced Medical Solutions BV (Netherlands), Biomatlante SA (France),
Advanced Medical Solutions Israel (Sealantis) Limited (Israel) and Raleigh Adhesive Coatings (UK) subject to specified procedures.
As a consequence of the audit scope determined, we achieved coverage of approximately 85% of revenue, 91% of profit before
tax and 99% of net assets. Our audit work at each location was executed at levels of materiality applicable to each individual
entity which was lower than Group materiality. Component materiality ranged from £0.5 million to £0.9 million (2021: £0.4 million
to £0.6 million).

7.2. our consideration of the control environment
We involved our IT specialists to gain an understanding of the IT environment and general IT controls. In assessing the IT
environment, we identified deficiencies in general IT controls which resulted in no controls reliance being taken. Whilst our
risk assessment and design of further audit procedures took into account our assessment of the control environment, the
audit we performed was fully substantive. We have reported the identified control deficiencies to management and the Audit
Committee. We understand that management intends to remediate the deficiencies as they develop the IT environment, as
referenced in the Audit Committee Report. on page 64.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

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to the members of Advanced Medical Solutions Group Plc

’ S r eP OrT CO N T I N U E D

7.3. our consideration of climate-related risks
In planning our audit, we have considered the potential impact of climate change on the Group’s business and its financial
statements.

We have held discussions with the Company Secretary and with the Directors to understand the process of identifying climate-
related risks, the determination of mitigating actions and the impact on the Group’s financial statements.

We performed our own qualitative risk assessment of the potential impact of climate change on the Group’s account balances and
classes of transactions and did not identify any additional risks of material misstatement beyond those identified by management.
Our procedures included reading disclosures included in the Strategic Report to consider whether they are materially consistent
with the financial statements and our knowledge obtained in the audit.

7.4. working with other auditors
Audit work to respond to the risks of material misstatement was performed directly by the group audit engagement team except
for Germany which is audited by the component auditor Deloitte & Touche GmbH. During the year and subsequent to the year
end, senior members of the Group audit team have engaged in regular communications with Deloitte & Touche GmbH. We
visited the component audit team during the planning phase, virtually attended the close meeting and reviewed their
documentation of the findings from their work virtually.

At the Group level we also tested the consolidation process and carried out analytical procedures to confirm our conclusion that
there were no significant risks of material misstatement of the aggregated financial information of the remaining components
(Russia, Czech Republic and the US components) not subject to audit.

8. Other information
The other information comprises the information included in the annual report, other than the financial statements and
our auditor’s report thereon. The directors are responsible for the other information contained within the annual report.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly
stated in our report, we do not express any form of assurance conclusion thereon.

Our responsibility is to read the other information and, in doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears to
be materially misstated.

If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether this gives
rise to a material misstatement in the financial statements themselves. If, based on the work we have performed, we conclude
that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

9. Responsibilities of directors
As explained more fully in the directors’ responsibilities statement, the directors are responsible for the preparation of the
financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors
determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether
due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the group’s and the parent company’s ability
to continue as a going concern, disclosing as applicable, matters related to going concern and using the going concern basis
of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have
no realistic alternative but to do so.

10. Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect
a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually
or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of
these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the FRC’s website at:
www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.

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11. Extent to which the audit was considered capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities, including fraud is detailed below.

11.1. identifying and assessing potential risks related to irregularities
In identifying and assessing risks of material misstatement in respect of irregularities, including fraud and non-compliance with
laws and regulations, we considered the following:

• the nature of the industry and sector, control environment and business performance including the design of the group’s

remuneration policies, key drivers for directors’ remuneration, bonus levels and performance targets;

• results of our enquiries of management, internal audit, the directors and the audit committee about their own identification

and assessment of the risks of irregularities, including those that are specific to the group’s sector;

• any matters we identified having obtained and reviewed the group’s documentation of their policies and procedures relating to:

identifying, evaluating and complying with laws and regulations and whether they were aware of any instances of
non-compliance;

- detecting and responding to the risks of fraud and whether they have knowledge of any actual, suspected or alleged fraud;

the internal controls established to mitigate risks of fraud or non-compliance with laws and regulations;

• the matters discussed among the audit engagement team including significant component audit teams and relevant internal

specialists, including, valuations and IT regarding how and where fraud might occur in the financial statements and any potential
indicators of fraud.

As a result of these procedures, we considered the opportunities and incentives that may exist within the organisation for fraud and
identified the greatest potential for fraud within revenue recognition due to possible pressures to meet stakeholder expectations
that could provide incentives to record revenues where performance obligations have not been satisfied.

In common with all audits under ISAs (UK), we are also required to perform specific procedures to respond to the risk of
management override.

We also obtained an understanding of the legal and regulatory frameworks that the group operates in, focusing on provisions
of those laws and regulations that had a direct effect on the determination of material amounts and disclosures in the financial
statements. The key laws and regulations we considered in this context included the UK Companies Act, AIM Listing Rules and
tax legislation.

In addition, we considered provisions of other laws and regulations that do not have a direct effect on the financial statements
but compliance with which may be fundamental to the group’s ability to operate or to avoid a material penalty such as those
set out by the relevant regulatory bodies.

11.2. Audit response to risks identified
As a result of performing the above, we identified revenue recognition as a key audit matter related to the potential risk of fraud.
The key audit matters section of our report explains the matter in more detail and also describes the specific procedures we
performed in response to this key audit matter.

In addition to the above, our procedures to respond to risks identified included the following:

• reviewing the financial statement disclosures and testing to supporting documentation to assess compliance with provisions

of relevant laws and regulations described as having a direct effect on the financial statements;

• enquiring of management, the audit committee and legal counsel concerning actual and potential litigation and claims;

• performing analytical procedures to identify any unusual or unexpected relationships that may indicate risks of material

misstatement due to fraud;

• reading minutes of meetings of those charged with governance and reviewing internal audit reports; and

• in addressing the risk of fraud through management override of controls, testing the appropriateness of journal entries and

other adjustments; assessing whether the judgements made in making accounting estimates are indicative of a potential bias;
and evaluating the business rationale of any significant transactions that are unusual or outside the normal course of business.

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

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to the members of Advanced Medical Solutions Group Plc

’ S r eP OrT CO N T I N U E D

We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members
including internal specialists and significant component audit teams, and remained alert to any indications of fraud or
non-compliance with laws and regulations throughout the audit.

Report on other legal and regulatory requirements

12. Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

• the information given in the strategic report and the directors’ report for the financial year for which the financial

statements are prepared is consistent with the financial statements; and

• the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in
the course of the audit, we have not identified any material misstatements in the strategic report or the directors’ report.

13. Matters on which we are required to report by exception

13.1. Adequacy of explanations received and accounting records
Under the Companies Act 2006 we are required to report to you if, in our opinion:

• we have not received all the information and explanations we require for our audit; or

• adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been

received from branches not visited by us; or

• the parent company financial statements are not in agreement with the accounting records and returns.

We have nothing to report in respect of these matters.

13.2. Directors’ remuneration
Under the Companies Act 2006 we are also required to report if in our opinion certain disclosures of directors’ remuneration
have not been made.

We have nothing to report in respect of this matter.

14. Use of our report
This report is made solely to the company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act
2006. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to
state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the company and the company’s members as a body, for our audit work, for this report,
or for the opinions we have formed.

Christopher Aylott (Senior statutory auditor)
For and on behalf of Deloitte LLP

Statutory Auditor
Cambridge

18 April 2023

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C O N S O L I D A TeD I N C O Me S T A TeMeN T
For the year ended 31 December 2022

Revenue
Cost of sales
Gross profit
Distribution costs
Administration costs
Other income
Operating profit
Finance income
Finance costs
Profit before taxation
Income tax
Profit for the year attributable to equity holders of the parent
Earnings per share
Basic

Diluted

The above results relate to continuing operations.

Note

4, 5
11
12

2022
£’000

124,330
(50,914)
73,416
(1,626)
(47,378)
478
24,890
1,691
(671)
25,910
(5,504)
20,406

9.42p

9.30p

2021
£’000

108,601
(47,531)
61,070
(1,483)
(36,970)
381
22,998
84
(1,098)
21,984
(4,503)
17,481

8.11p

8.01p

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

C O N S O L I D A TeD S T A TeMeN T O F C O M Pr eHeN S Iv e I N C O Me
For the year ended 31 December 2022

Profit for the year
Items that will potentially be reclassified subsequently to profit and loss:
Exchange differences on translation of foreign operations
Loss arising on cash flow hedges
Deferred tax (charge)/gain arising on cash flow hedges
Other comprehensive income/(expense) for the year

Total other comprehensive income for the year

Note

2022
£’000

2021
£’000

24
18

20,406
6,940
(1,297)
(201)
5,442

25,848

17,481
(5,194)
(1,548)
290
(6,452)

11,029

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C O N S O L I D A TeD S T A TeMeN T O F F I N A N C I A L P O S I T I O N
At 31 December 2022

Note

2022
£’000

2021
£’000

Assets
Non-current assets
Intangible assets
Goodwill
Property, plant and equipment
Trade and other receivables

Current assets
Inventories
Trade and other receivables
Current tax assets
Cash and cash equivalents

Total assets
Liabilities
Current liabilities
Trade and other payables
Current tax liabilities
Lease liability

Non-current liabilities
Trade and other payables
Deferred tax liabilities
Lease liability

Total liabilities
Net assets
Equity
Share capital
Share premium
Share-based payments reserve
Investment in own shares
Share-based payments deferred tax reserve
Other reserve
Hedging reserve
Translation reserve
Retained earnings

Equity attributable to equity holders of the parent

16
19
17
21

20
21

23
18
23

28
28
28

48,373
70,859
29,015
937
149,184

27,911
21,553
184
82,262
131,910
281,094

20,671
948
1,059
22,678

3,510
9,593
8,691
21,794
44,472
236,622

10,843
37,269
15,711
(167)
531
1,531
(1,519)
5,004
167,419

236,622

40,958
66,032
27,441
105
134,536

19,300
21,016
1,692
72,965
114,973
249,509

14,958
897
1,153
17,008

3,679
7,438
8,707
19,824
36,832
212,677

10,804
36,996
13,180
(164)
933
1,531
(21)
(1,936)
151,354

212,677

The financial statements of Advanced Medical Solutions Group plc (registration number 2867684) on pages 89 to 122 were
approved by the Board of Directors and authorised for issue on 18 April 2023 and were signed on its behalf by:

Chris Meredith
Chief Executive Officer

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

C O N S O L I D A TeD S T A TeMeN T O F C H A N GeS I N eQ U I T Y
Attributable to equity holders of the Group

Share
capital
£’000

Share
premium
£’000

Share-
based
payments
£’000

Investment
in own
shares
£’000

Share-
based
payments
deferred
tax
£’000

Other
reserve
£’000

Hedging
reserve
£’000

Translation
reserve
£’000

Retained
earnings
£’000

Total
£’000

10,769 36,288

11,142

(162)

430

1,531

1,237

3,258 137,718 202,211

At 1 January 2021
Consolidated profit for the
year to 31 January 2021
Other comprehensive expense
Total comprehensive
(expense)/income
Share-based payments
(Note 29)
Share options exercised
(Note 29)
Shares purchased by EBT
Shares sold by EBT
Dividends paid (Note 14)
At 31 December 2021
Consolidated profit for the
year to 31 December 2022
Other comprehensive
(expense)/income
Total comprehensive
(expense)/income
Share-based payments
(Note 29)
Share options exercised
(Note 29)
Shares purchased by EBT
Shares sold by EBT
Dividends paid (Note 14)

–
–

–

–
–

–

35
–
–
–

708
–
–
–
10,804 36,996

–

39
–
–
–

–

273
–
–
–

–
–

–

1,979

59
–
–
–
13,180

–

2,439

92
–
–
–

At 31 December 2022

10,843

37,269

15,711

–
–

–

–
(366)
364
–
(164)

–

–
(392)
389
–

(167)

–
–

–

503

–
–
–
–
933

–

(402)

–
–
–
–

–
–

–

–
–
–
–
1,531

–

–
–
–
–

–
(1,258)

–
(5,194)

17,481
–

17,481
(6,452)

(1,258)

(5,194)

17,481

11,029

–

–
–
–
–
(21)

–

2,482

–
–
–
–

802
–
(366)
–
364
–
(3,845)
(3,845)
(1,936) 151,354 212,677

– 20,406 20,406

(1,498)

6,940

–

5,442

(1,498)

6,940 20,406 25,848

–

–
–
–
–

–

–
–
–
–

–

2,037

–
–
–
(4,341)

404
(392)
389
(4,341)

531

1,531

(1,519)

5,004 167,419 236,622

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C O N S O L I D A TeD S T A TeMeN T O F C A S H F L O wS
For the year ended 31 December 2022

Cash flows from operating activities
Operating profit
Adjustments for:
Depreciation
Amortisation – intellectual property rights

– software intangibles
– development costs

(Increase)/decrease in inventories
Increase in trade and other receivables
Increase in trade and other payables
Share-based payments expense
Taxation paid
Net cash inflow from operating activities
Cash flows from investing activities
Purchase of software
Capitalised research and development
Purchases of property, plant and equipment
Disposal of property, plant and equipment
Interest received
Acquisition of subsidiaries (net of cash acquired)
Net cash used in investing activities
Cash flows from financing activities
Dividends paid
Repayment of principal under lease liabilities
Repayment of borrowings
Issue of equity shares
Shares purchased by EBT
Shares sold by EBT
Interest paid
Net cash used in financing activities
Net increase in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Effect of foreign exchange rate changes

Cash and cash equivalents at the end of the year

Note

2022
£’000

2021
£’000

24,890

22,998

17
16
16
16

4,049
3,414
502
879
(7,087)
(596)
1,711
2,439
(3,324)
26,877

(73)
(6,152)
(3,739)
46
820
(2,781)
(11,879)

(4,341)
(1,295)
(331)
266
(392)
389
(617)
(6,321)
8,677
72,965
620

82,262

3,893
3,179
529
1,247
941
(1,769)
2,105
1,979
(4,077)
31,025

(254)
(4,441)
(1,768)
53
84
–
(6,326)

(3,845)
(1,281)
–
723
(366)
364
(700)
(5,105)
19,594
53,829
(458)

72,965

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

N O TeS F OrM I N G P ArT O F T He C O N S O L I D A TeD
F I N A N C I A L S T A TeMeN T S

1 Reporting entity
Advanced Medical Solutions Group plc (‘the Company’) is a public limited Company incorporated and domiciled in England
and Wales (registration number 2867684). The Company’s registered address is Premier Park, 33 Road One, Winsford Industrial
Estate, Cheshire, CW7 3RT.

The Company’s Ordinary Shares are traded on the AIM market of the London Stock Exchange plc. The Consolidated Financial
Statements of the Company for the twelve months ended 31 December 2022 comprise the Company and its subsidiaries
(together referred to as the ‘Group’).

The Group is a world-leading independent developer and manufacturer of innovative tissue-healing technology, focused on
quality outcomes for patients and value for payers. The Group has a wide range of surgical products including tissue adhesives,
sutures, haemostats, internal fixation devices and internal sealants, which it markets under its brands LiquiBand®, RESORBA®,
LiquiBandFix8® and Seal-G®. The Group also supplies woundcare dressings such as silver alginates, alginates and foams through
its ActivHeal® brand as well as under white-label. Since 2019, the Group has made four acquisitions: Sealantis, an Israeli medical
device Company with a patent-protected sealant technology platform; Biomatlante, an established French developer and
manufacturer of innovative surgical biomaterial technologies, Raleigh, a UK leading coater and converter of materials predominately
for woundcare and biodiagnostics products and AFS Medical, an Austrian-based specialist surgical business with a focus on
minimally invasive procedures.

The Group’s products, manufactured in the UK, Germany, France, the Netherlands, the Czech Republic and Israel, are sold
globally via a network of multinational or regional partners and distributors, as well as via the Group’s own direct sales forces in
the UK, Germany, Austria, the Czech Republic and Russia. The Group has R&D innovation hubs in the UK, Germany, France and
Israel. Established in 1991, the Group has more than 700 employees.

2 Basis of preparation
The Group’s financial statements have been prepared in accordance with International Financial Reporting Standards (‘IFRSs’),
as adopted by the UK.

The Financial Statements have been prepared on the historical cost basis of accounting except as disclosed in the accounting
policies set out below.

The individual Financial Statements for each Group Company are presented in the currency of the primary economic
environment in which it operates (its ‘functional currency’). For the purpose of the Consolidated Financial Statements, the
results and financial position of each Group Company are expressed in Pounds Sterling, which is the functional currency of
the Company and the presentation currency for the Consolidated Financial Statements.

In the current year the Group has applied amendments to IFRSs issued by the IASB. Their adoption has not had a material impact
on the disclosures or on the amounts reported in the Annual Financial Statements. The following amendments were applied:

• Onerous Contracts – Cost of Fulfilling a Contract (Amendments to IAS37)

• Property, Plant and Equipment: Proceeds before Intended Use (Amendments to IAS 16)

• Annual Improvements to IFRS Standards 2018-2020 (Amendments to IFRS1, IFRS9, IFRS16 and IAS 41); and

• References to Conceptual Framework (Amendments to IFRS3)

going concern
In carrying out their duties in respect of going concern, the Directors have carried out a review of the Group’s financial
position and cash flow forecasts for a period of 12 months from the date of signing the accounts. These have been based on
a comprehensive review of revenue, expenditure and cash flows, taking into account specific business risks and the current
economic environment. Sensitivity analysis has been prepared to stress test forecasts and the Directors are confident the
business is a going concern given the significant headroom available.

With regards to the Group’s financial position, it had cash and cash equivalents at the year-end of £82.3 million.

While the current economic environment is very uncertain, with inflationary pressure and rising interest rates, the Group
operates in markets whose demographics are favourable, underpinned by an increasing need for products to treat chronic and
acute wounds. Consequently, market growth is predicted. The Group has a large number of contracts with customers across
different geographic regions and also with substantial financial resources, ranging from government agencies through to global
healthcare companies.

Having taken the above into consideration, the Directors have reached a conclusion that the Group is well placed to manage its
business risks in the current economic environment. Accordingly, they continue to adopt the going concern basis in preparing
the accounts.

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3 Accounting policies
critical Accounting Judgements and Key Sources of estimation Uncertainty
The preparation of Financial Statements, in conformity with adopted IFRS, requires management to make judgements, estimates
and assumptions that affect the application of accounting policies and the reported value of assets and liabilities, income and
expense. Actual results may differ from these estimates. In preparing these Financial Statements, no key source of estimation
uncertainty and two critical accounting judgement has been identified that could potentially have a material adjustment to
the carrying amounts of assets and liabilities in future financial years.

capitalisation of development and recertification costs
The Group capitalises development and recertification costs once it can be demonstrated that the product or process is clearly
identifiable, technically and commercially feasible and will generate future economic benefits which requires judgment. The
recoverable amount is determined based on a value-in-use calculation at a product category level which involves the use of
critical accounting judgments. Judgments may involve an estimation of future costs to complete the asset as well as future
sales, cost of sales and an allocation of operating costs. A discount rate is applied reflecting the time value of money.

valuation of assets acquired on acquisition
Upon acquisition of AFS in the year, the Group has identified assets and liabilities arising on acquisitions and devised fair values
for them (see note 31). Third-party valuation specialists were engaged to assist in the identification and valuation of separable
intangible assets. Management considers that the methodologies adopted in the valuation are supportable and reasonable but
there are inherent sources of estimation uncertainty due to the inclusion of future cash flows in the valuation which include
estimates of sales growth, production costs and operating expenditure. Discount rates used in determining the fair values
are based on management’s assessment of risk inherent in the current business model and are an area of judgment.

Basis of consolidation
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power to govern the financial
and operating policies of an entity so as to retain benefits from its activities. The Financial Statements of the subsidiaries
are included in the Consolidated Financial Statements on the basis of acquisition accounting, from the date that control
commences until the date that control ceases. All entities within the Group have the same year-end.

Intercompany transactions and balances between Group entities are eliminated upon consolidation.

Business combinations
The acquisition of subsidiaries is accounted for using the acquisition method. The cost of the acquisition is measured at the
aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, the equity instruments issued
by the Group in exchange for control of the acquiree, plus any costs directly attributable to the issue of debt or equity. Acquisition
related expenses are accounted for as expenses in the period in which the costs are incurred and the services rendered, with the
exception of directly attributable costs incurred as a result of raising equity, which are offset against share premium, and raising
debt, which are capitalised and amortised over the term of the debt. The acquiree’s identifiable assets, liabilities and contingent
liabilities that meet the conditions for recognition under IFRS 3 are recognised at their fair value at the acquisition date, except
for non-current assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non-Current Assets
Held for Sale and Discontinued Operations, which are recognised and measured at fair value less costs to sell.

Goodwill arising on acquisition is recognised as an asset and initially measured at cost, being the excess of the cost of the business
combination over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities recognised.
If, after reassessment, the Group’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent
liabilities exceeds the cost of the business combination, the excess is recognised immediately in the Income Statement.

goodwill
Goodwill arising on consolidation represents the excess of the cost of acquisition over the Group’s interest in the fair value of
the identifiable assets and liabilities of a subsidiary, associate or jointly controlled entity at the date of acquisition. Goodwill is
initially recognised as an asset at cost and is subsequently measured at cost less any accumulated impairment losses. Goodwill
which is recognised as an asset is reviewed for impairment at least annually on the basis of the recoverable amount for the
relevant cash-generating unit. In assessing recoverable amount, the estimated future cash flows are discounted to their present
value using a discount rate that reflects the current market assessments of the time. Any impairment is recognised immediately
in the Income Statement and is not subsequently reversed.

Revenue recognition
The Group manufactures and sells a range of innovative and technologically advanced products for the global surgical, woundcare
and wound-closure markets. Sales are recognised when control of the products has transferred to the customer in accordance
with the contractual shipping terms, the customer has discretion over the channel and price to sell the products in accordance
with the sales contract, and there is no unfulfilled obligation that could affect the customer’s acceptance of the products. Transfer
occurs when the products have been shipped to the specific location, the risks of obsolescence and loss have been transferred
to the customer, and either the customer has accepted the products in accordance with the sales contract, the acceptance
provisions have lapsed or the Group has objective evidence that all criteria for acceptance have been satisfied.

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3 Accounting policies continued
Occasionally, the products are sold with volume discounts based on aggregate sales over a 12 month period. Revenue from
these sales is recognised based on the price specified in the contract, net of the estimated volume discounts. Accumulated
experience and customer-provided forecasts are used to estimate and provide for the discounts, using the expected-value
method, and revenue is only recognised to the extent that it is highly probable that a significant reversal will not occur. No
element of finance is deemed present as the sales are made with a credit term of up to 90 days, which is consistent with
market practice. A receivable is recognised when the goods are transferred as this is the point in time that the consideration
is unconditional because only the passage of time is required before the payment is due.

The Group also recognises revenue from royalty income receivable under licence agreements from external customers
at amounts excluding value added tax as the products under licence are sold and the revenue can be reliably measured.
For the year ended 31 December 2022, £6.6 million (2021: £4.7 million) revenue from royalty income was recognised.

other income
Other income relates to tax credits received under the UK Research and Development Expenditure Credit (‘RDEC’) scheme
and is recognised in the Income Statement in the same period in which the expense is incurred.

grants
Grants are recognised only when there is reasonable assurance that the Group will comply with the conditions attached to
them and that the grants will be received. Grants related to income are presented as a deduction of the related cost. Grants
that are receivable as compensation for expenses already incurred are recognised in the Income Statement in the period in
which they become receivable.

exceptional items
Exceptional items are those items that are significant for separate disclosure by virtue of their size, nature or incidence, or that
the Directors consider should be disclosed separately to enable a full understanding of the Group’s financial performance. This
includes non-recurring transaction costs (see Note 6). The Directors consider that this presentation gives a fairer presentation
of the results of the Group. No exceptional costs were incurred during the year (2021: £nil).

Finance income
Finance income relates to interest earned on cash and cash equivalents. Interest income is accrued on a time-basis, by reference
to the principal outstanding and at the effective interest rate applicable.

Finance costs
Finance costs arise from interest on the Group’s credit facilities, lease liabilities and financial liabilities. They are recognised
in the Income Statement as they accrue using the effective interest method.

Finance costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that
necessarily take a substantial period of time to get ready for their intended use, are added to the cost of those assets, until
such time as the assets are substantially ready for their intended use.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying
assets is deducted from the borrowing costs eligible for capitalisation.

provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is
probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable
estimate can be made of the amount of the obligation.

Foreign currencies
Transactions in foreign currencies are translated at the foreign exchange rate ruling at the date of the transaction. Monetary
assets and liabilities denominated in foreign currencies at the Statement of Financial Position date are translated at the foreign
exchange rate ruling at that date. Foreign exchange differences arising on translation are recognised in the Income Statement.
Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the
exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are
stated at fair value are translated at foreign exchange rates ruling at the date the fair value was determined.

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on consolidation, are
translated at foreign exchange rates ruling at the Statement of Financial Position date. The revenue and expenses of foreign
operations are translated at an average rate for the period unless exchange rates fluctuate significantly. Exchange differences
arising on consolidation are recognised in equity within the Group’s translation reserve. Such translation differences are
recognised as income or expense in the period in which the operation is disposed of.

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Hedging
The Group designates certain hedging instruments, which include derivatives in respect of foreign currency risk, as cash flow
hedges. Hedges of foreign exchange risk on firm commitments are accounted for as cash flow hedges. At the inception of the
hedge relationship, the entity documents the relationship between the hedging instrument and the hedged item, along with its
risk management objectives and its strategy for undertaking various hedge transactions in order to confirm the principle of an
‘economic relationship’ exists. Note 24 sets out details of the fair values of the derivative instruments used for hedging purposes.

The effective portion of changes in the fair value of derivatives and other qualifying hedging instruments that are designated
and qualify as cash flow hedges is recognised in other comprehensive income and accumulated under the heading of cash flow
hedging reserve, limited to the cumulative change in fair value of the hedged item from inception of the hedge. The gain or loss
relating to the ineffective portion is recognised immediately in the Income Statement.

Amounts previously recognised in other comprehensive income and accumulated in equity are reclassified to the Income
Statement in the periods when the hedged item affects the Income Statement, in the same line as the recognised hedged
item. Furthermore, if the Group expects that some or all of the loss accumulated in the cash flow hedging reserve will not be
recovered in the future, that amount is immediately reclassified to the Income Statement.

The Group discontinues hedge accounting only when the hedging relationship (or a part thereof) ceases to meet the qualifying
criteria (after rebalancing, if applicable). This includes instances when the hedging instrument expires or is sold, terminated or
exercised. The discontinuation is accounted for prospectively. Any gain or loss recognised in other comprehensive income and
accumulated in cash flow hedge reserve at that time remains in equity and is reclassified to the Income Statement when the
forecast transaction occurs. When a forecast transaction is no longer expected to occur, the gain or loss accumulated in the
cash flow hedge reserve is reclassified immediately to the Income Statement.

The Group’s risk management strategies and hedge documentation are aligned with the requirements of IFRS 9.

taxation
Taxation expense includes the amount of current income tax payable and the charge for the year in respect of deferred taxation.

Current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the Income
Statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes
items that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been
enacted or substantively enacted by the end of the reporting period.

A provision is recognised for those matters for which the tax determination is uncertain but it is considered probable that there
will be a future outflow of funds to a tax authority. The provisions are measured at the best estimate of the amount expected to
become payable. The assessment is based on the judgement of tax professionals within the Company supported by previous
experience in respect of such activities and in certain cases based on specialist independent tax advice.

Deferred tax
Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets
and liabilities in the Financial Statements and the corresponding tax bases used in the computation of taxable profit, and is
accounted for using the liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences
and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which
deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference
arises from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that
affects neither the taxable profit nor the accounting profit. In addition, a deferred tax liability is not recognised if the temporary
difference arises from the initial recognition of goodwill.

Deferred tax is charged or credited to the Income Statement, except when it relates to items charged or credited directly to
equity, in which case it is dealt with within equity.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates, and
interests in joint ventures, except where the Group is able to control the reversal of the temporary difference and it is probable
that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary
differences associated with such investments and interests are only recognised to the extent that it is probable that there will
be sufficient taxable profits against which to utilise the benefits of the temporary differences and they are expected to reverse
in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset
is realised based on tax laws and rates that have been enacted or substantively enacted at the reporting date.

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3 Accounting policies continued
The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in
which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current
tax liabilities and when they relate to income taxes levied by the same taxation authority and the Group intends to settle its
current tax assets and liabilities on a net basis.

Current tax and deferred tax for the year
Current and deferred tax are recognised in the Income Statement, except when they relate to items that are recognised
in other comprehensive income or directly in equity, in which case the current and deferred tax are also recognised in other
comprehensive income or directly in equity respectively. Where current tax or deferred tax arises from the initial accounting for
a business combination, the tax effect is included in the accounting for the business combination.

intangible assets
Acquired intellectual property rights
Intellectual property rights that are acquired in a business combination are initially recognised at their fair value. Intellectual property
rights purchased outright are initially recognised at cost. Intellectual property rights are capitalised and amortised over their estimated
useful economic lives, usually not exceeding 15 years. In determining the useful economic life each asset is reviewed separately and
consideration given to the period over which the Group expects to derive economic benefit from the asset.

other intangible assets
Other intangibles consist mainly of research and device technologies and customer-related intangible assets acquired on
acquisition and are initially recognised at their fair value. Other intangibles are amortised over their estimated useful economic
lives, usually not exceeding 12 years. In determining the useful economic life each asset is reviewed separately and consideration
given to the period over which the Group expects to derive economic benefit from the asset.

Development costs
Expenditure on research activities, undertaken with the prospect of gaining new scientific or technical knowledge, is recognised
in the Income Statement as an expense in the period in which it is incurred.

Expenditure on development activities, where research findings are applied to a plan or design for the production of new or
substantially improved products and processes, is capitalised once it can be demonstrated that the product or process is clearly
identifiable, technically and commercially feasible, will generate future economic benefits, that the development costs of the
asset can be measured reliably and the Group has sufficient resources to complete development. Expenditure capitalised is
stated as the cost of materials and direct labour less accumulated amortisation.

Where development expenditure results in new or substantially improved products or processes and it is probable that recovery
will take place, it is capitalised and amortised on a straight-line basis over the product’s useful life starting from the date on
which serial production commences, which is between one and ten years. Patents and trademarks are measured initially at
purchase cost and are amortised on a straight-line basis unless there is commercial evidence demonstrating that this will not
be a materially appropriate allocation, in which case amortisation is allocated based on a five year revenue forecast to ensure
the expense is allocated against the benefit arising from the asset.

Regulatory certification costs
Expenditure on regulatory certification costs, where the certificate allows a product to be sold into a market for a period of
time greater than one year, is capitalised once it can be demonstrated that the product is clearly identifiable, technically and
commercially feasible, will generate future economic benefits, that the certification costs of the asset can be measured reliably
and the Group has sufficient resources to complete certification. Expenditure capitalised is stated as the cost of materials
less accumulated amortisation. Internal costs relating to regulatory certification costs are not capitalised unless they can be
identified as directly attributable to the certification process. Capitalised certification costs are amortised over the term of the
certificate which can be up to five years and is deemed to be the useful economic life. Clinical and regulatory data supporting
the certification are amortised over ten years reflecting the estimated useful economic life.

Software intangibles
Where computer software is not integral to an item of property, plant or equipment its costs are capitalised as intangible assets
when there is sufficient levels of customisation and control of future economic benefits or where other contractual rights exist.
Amortisation is provided on a straight-line basis over its useful economic life, which is in the range of three to ten years.

property, plant and equipment
Land and buildings and plant and equipment held for use in the production of goods and services or for administrative purposes
are carried in the Statement of Financial Position at cost less any subsequent accumulated depreciation and subsequent
accumulated impairment losses.

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The Group elected to use the fair value as the deemed cost in respect of land and buildings at the date of transition to IFRS.
Fair value was calculated by reference to their existing use at the date of transition.

Depreciation is provided to write off the cost, less estimated residual values, of all property, plant and equipment, over the
expected useful life of the asset from the date that the asset is brought into use. It is calculated at the following rates:

• Freehold land

• Freehold property and improvements

–

Not depreciated

4% per annum on cost

• Leasehold improvements and Right-of-use assets –

Shorter of useful economic life and unexpired period of the lease

• Plant and machinery

• Fixtures and fittings

• Motor vehicles

–

6.7% to 33.3% per annum on cost

33.3% per annum on cost

25% per annum on cost

Property, plant and equipment in the course of construction for production are carried at cost, less any recognised impairment
loss. Depreciation of these assets, on the same basis as other property, plant and equipment assets, commences when the
assets are ready for their intended use.

impairment of tangible and intangible assets excluding goodwill
At each reporting date, the Group reviews the carrying amounts of its property, plant and equipment and intangible assets
to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists,
the recoverable amount of the asset is estimated to determine the extent of the impairment loss (if any). Where the asset
does not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the
cash-generating unit to which the asset belongs. When a reasonable and consistent basis of allocation can be identified,
corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest
group of cash-generating units for which a reasonable and consistent allocation basis can be identified.

Intangible assets with an indefinite useful life are tested for impairment at least annually and whenever there is an indication
at the end of a reporting period that the asset may be impaired.

Recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of
the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying
amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately
in the Income Statement, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated
as a revaluation decrease and to the extent that the impairment loss is greater than the related revaluation surplus, the excess
impairment loss is recognised in the Income Statement.

Where an impairment loss subsequently reverses, the carrying amount of the asset (or cash-generating unit) is increased to the
revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount
that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior
years. A reversal of an impairment loss is recognised immediately in the Income Statement to the extent that it eliminates the
impairment loss which has been recognised for the asset in prior years. Any increase in excess of this amount is treated as
a revaluation increase.

calculation of recoverable amount
The recoverable amount is the higher of fair value less costs to sell or value in use. In assessing value in use, the estimated future
cash flows are discounted to their present value using a discount rate that reflects the current market assessments of the time
value of money.

Reversal of impairment
An impairment loss in respect of a receivable carried at amortised cost is reversed if the subsequent increase in recoverable
amount can be related objectively to an event occurring after the impairment loss was recognised.

In respect of other assets, an impairment loss is reversed when there is an indication that the impairment loss may no longer
exist and there has been a change in the estimates used to determine the recoverable amount.

An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that
would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

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3 Accounting policies continued
inventory
Inventory is valued at the lower of cost or net realisable value. Cost comprises direct materials and, where applicable, direct
labour costs that have been incurred in bringing the inventories to their present location and condition, and an attributable
proportion of manufacturing overheads based on normal levels of activity.

Net realisable value is based on estimated selling price less further costs to completion and disposal.

The Group makes provision for inventory deemed to be irrecoverable or where the net realisable value is lower than cost.
This provision is established on a stock keeping unit (‘SKU’) basis by reference to the age of the stock, the forward order book,
management’s experience and its assessment of the present value of estimated future cash flow.

Financial instruments
Classification of financial instruments
Financial instruments are classified as financial assets, financial liabilities or equity instruments.

Financial instruments issued by the Group are treated as equity only to the extent that they meet the following two conditions:

• They include no contractual obligations upon the Group to deliver cash or other financial assets that are potentially

unfavourable to the Group; and

• Where the instrument will or may be settled in the Group’s own equity instruments, it is either a non-derivative that includes
no obligation to deliver a variable number of the Group’s own equity instruments or is a derivative that will be settled by the
Group exchanging a fixed amount of cash or other financial assets for a fixed number of its own equity instruments.

To the extent that this definition is not met, the proceeds of issue are classified as a financial liability.

Recognition and valuation of financial assets
Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and cash deposits and amounts under short-term guarantees,
usually three months or less, that are held for the purpose of meeting short-term cash commitments and are subject to
insignificant risk in change in value and which are readily convertible to a known amount of cash. Cash held in accounts
with more than 90 days’ notice that are not required to meet short-term cash commitments are shown as an investment.

Trade and other receivables
Trade and other receivables are stated initially at fair value and subsequent to initial recognition they are measured at amortised
cost including a provision for expected credit losses. The Group measures the provision at an amount equal to lifetime expected
credit losses, estimated by reference to past experience and relevant forward-looking factors. The Group writes off a receivable
when there is objective evidence that the debtor is in significant financial difficulty and there is no realistic prospect of recovery,
for example, when a debtor enters bankruptcy or financial reorganisation.

The Group recognises a loss allowance for expected credit losses on investments in debt instruments that are measured at
amortised cost or at fair value through other comprehensive income. The amount of expected credit losses is updated at each
reporting date to reflect changes in credit risk since initial recognition of the respective financial instrument.

An allowance for expected credit losses is recognised for expected lifetime credit losses that result from the failure or inability
of customers to make required payments. It is not necessary for a credit event to have occurred before credit losses are
recognised. Instead, the Group accounts for expected lifetime credit losses and changes in those expected lifetime credit
losses. In determining the allowance, consideration includes the probability of recoverability based on past experience,
general economic factors and adjustments for specific customers whose specific circumstances indicate a higher or lower
risk of default. The amount of expected credit losses, if any, are required to be updated at each reporting date.

De-recognition of financial assets
The Group de-recognises a financial asset only when the contractual rights to the cash flows from the asset expire, or when it
transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Group
neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset,
the Group recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Group
retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognise
the financial asset and also recognises a collateralised borrowing for the proceeds received.

On de-recognition of a financial asset measured at amortised cost, the difference between the asset’s carrying amount and the
sum of the consideration received and receivable is recognised in the Income Statement. In addition, on de-recognition of an
investment in a debt instrument classified as FVTOCI, the cumulative gain or loss previously accumulated in the investments
revaluation reserve is reclassified to the Income Statement. In contrast, on de-recognition of an investment in an equity instrument
which the Group has elected on initial recognition to measure at FVTOCI, the cumulative gain or loss previously accumulated in
the investments revaluation reserve is not reclassified to the Income Statement, but is transferred to retained earnings.

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Recognition and valuation of equity instruments
Equity instruments are stated at par value. Any premium on issue is taken to the share premium account.

Recognition and valuation of financial liabilities
Financial liabilities are classified according to the substance of the contractual arrangements entered into.

Trade payables
Trade payables are initially recognised at fair value and are subsequently recognised at amortised cost using the effective
interest method.

Other loans
Other loans are initially recognised at fair value and are subsequently recognised at amortised cost using the effective
interest method.

Financial liabilities at Fair value through profit or loss (‘Fvtpl’)
A derivative that is not designated and effective as a hedging instrument is classified as held for trading. Financial liabilities are
classified as FVTPL where the financial liabilities are held for trading.

Financial liabilities at FVTPL are stated at fair value, with any resultant gain or loss recognised in the Income Statement. Fair value
is determined in the manner described in Note 24.

Derivative financial instruments
The Group enters into foreign exchange forward contracts to manage its exposure to foreign exchange rate risk. Further details
of derivative financial instruments are disclosed in Note 24 to the Financial Statements.

Derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently remeasured
to their fair value at each Statement of Financial Position date. The resulting gain or loss is recognised in the Income Statement
(administrative costs) immediately unless the derivative is designated and effective as a hedging instrument, in which event
the timing of the recognition in the Income Statement depends on the nature of the hedge relationship. The Group currently
designates certain derivatives as hedges of highly probable forecast transactions or hedges of foreign currency risk of firm
commitments (cash flow hedges). A derivative with a positive fair value is recognised as a financial asset whereas a derivative
with a negative fair value is recognised as a financial liability.

Derivatives with remaining maturity of less than 12 months are presented as current assets or current liabilities.

leased assets
For all assets, the lessee recognises a right-of-use asset and a corresponding liability at the date at which the leased asset is
available to use. Assets and liabilities arising from a lease are initially measured on a present value basis using the interest rate
implicit in the lease or, if that rate cannot be readily determined, the incremental borrowing rate. Lease payments are allocated
between the liability and finance expense. The finance expense is charged to profit and loss over the lease period so as to
produce a constant periodic rate of interest on the remaining balance of the liability for each period. The right-of-use asset is
depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis. Payments associated with leases
with a lease term of 12 months or less and leases of low-value assets are recognised as an expense in the Income Statement on
a straight-line basis.

pensions
The Group operates a money purchase pension scheme. The assets of the scheme are held separately from those of the
Group in an independently administered fund. The amount charged against the Income Statement represents the contributions
payable to the scheme in respect of the accounting period.

Share-based payments
The Group issues equity–settled share-based payments to certain employees. Equity-settled share-based payments are
measured at fair value at the date of grant. The fair value, as determined at the grant date of equity–settled share-based
payments, is expensed on a straight-line basis over the vesting period, based on the Group’s estimate of options that will
eventually vest. At each Statement of Financial Position date the Group revises its estimate of the number expected to vest
as a result of the effect of non-market based vesting conditions. The impact, if any, is recognised in the Income Statement
with a corresponding adjustment to reserves.

Fair value is measured by use of a Black-Scholes Merton or Monte Carlo model. The expected life used in the model
has been adjusted, based on management’s best estimate, for the effect of non-transferability, exercise restrictions and
behavioural considerations.

capital management
For the year ended 31 December 2022, the Group had net funds with no borrowings (2021: net funds with no borrowings).
Working capital is managed in order to generate maximum conversion of profits into cash and cash equivalents thereby
maintaining capital. As the Group had net funds with no external borrowings a reconciliation of net debt is not provided.

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3 Accounting policies continued
Capital includes share capital, share premium, investment in own shares, share-based payments reserve, share-based payments
deferred tax reserve, other reserve, translation reserve and retained earnings reserve. There are no externally imposed capital
requirements on the Group.

The Group returns cash to shareholders by means of dividends whilst ensuring the Group has the cash available to develop the
products and services provided by the Group in order to provide an adequate return to shareholders.

employee Benefit trusts
The Group operates an Employee Benefit Trust (‘EBT’): ‘Advanced Medical Solutions Group plc UK Employee Benefit Trust’.

The Group has de facto control of the assets, liabilities and shares held by the Trust and bear their benefits and risks. The Group
records assets and liabilities of the Trust as its own.

In compliance with IAS 32 ‘Financial Instruments: Presentation Group’, shares held by the EBT are included in the Consolidated
Statement of Financial Position as a reduction in equity. Gains and losses on Group shares are recognised directly in reserves.

iFRS not yet effective and not adopted early
Certain new accounting standards, amendments and interpretations have been published that are not mandatory for 31 December
2022 reporting periods and have not been early adopted by the group. These standards are not expected to have a material impact
on the Group in the current or future reporting periods or on foreseeable future transactions.

4 Segment information
During the year ended 31 December 2022, the Group continued to operate under two business units. The Surgical Unit focused
on selling, marketing, research, development and innovation of all our surgical products and the Woundcare Unit focused on all
advanced woundcare sales, marketing, research, development and innovation of all woundcare devices, regardless of whether
they are sold under an AMS or a partner’s brand name.

Year ended 31 December 2022

Revenue
Result
Adjusted segment operating profit
Amortisation of acquired intangibles
Segment operating profit
Unallocated expenses
Operating profit
Finance income
Finance costs
Profit before tax
Tax

Profit for the year

Year ended 31 December 2022
Other information

Capital additions:
Software intangibles
Research & development
Property, plant and equipment
Depreciation and amortisation

At 31 December 2022
Statement of Financial Position
Assets
Segment assets
Unallocated assets
Consolidated total assets
Liabilities

Segment liabilities

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Advanced Medical Solutions Group plc Annual Report & Accounts 2022

Surgical
£’000

74,861

Woundcare
£’000

Consolidated
£’000

49,469

124,330

21,802
(2,469)
19,333

7,632
(945)
6,687

29,434
(3,414)
26,020
(1,130)
24,890
1,691
(671)
25,910
(5,504)

20,406

Surgical
£’000

Woundcare
£’000

Consolidated
£’000

34
4,617
2,258
(5,759)

39
1,535
1,481
(3,085)

73
6,152
3,739
(8,844)

190,456

90,638

281,094
-
281,094

29,786

14,686

44,472

o v e R v i e w

S t R At e g i c R e p oR t

g o v e R nAn c e

F I N A N C I A L S TAT e M e N T S

Year ended 31 December 2021

Revenue
Result
Adjusted segment operating profit
Amortisation of acquired intangibles
Segment operating profit
Unallocated expenses
Operating profit
Finance income
Finance costs
Profit before tax
Tax

Profit for the year

Year ended 31 December 2021
Other information

Capital additions:
Software intangibles
Research & development
Property, plant and equipment
Depreciation and amortisation

At 31 December 2021
Statement of Financial Position
Assets
Segment assets
Unallocated assets
Consolidated total assets
Liabilities

Segment liabilities

Surgical
£’000

64,630

Woundcare
£’000

Consolidated
£’000

43,971

108,601

20,303
(2,005)
18,298

6,594
(1,174)
5,420

26,897
(3,179)
23,718
(720)
22,998
84
(1,098)
21,984
(4,503)

17,481

Surgical
£’000

Woundcare
£’000

Consolidated
£’000

145
2,922
1,028
(5,579)

109
1,519
740
(3,269)

254
4,441
1,768
(8,848)

159,442

89,944

249,386
123
249,509

22,651

14,181

36,832

geographical segments
The Group operates in the UK, Germany, the Netherlands, France, the Czech Republic and Israel with sales offices in Russia and
Austria and a sales presence in the US. In presenting information on the basis of geographical segments, segment revenue is
based on the geographical location of customers. Segment assets are based on the geographical location of the assets.

The following table provides an analysis of the Group’s sales by geographical market, irrespective of the origin of the goods
or services, based upon location of the Group’s customers:

Year ended 31 December

United Kingdom
Germany
Rest of Europe
United States of America
Rest of World

2022
£’000

19,960
20,780
32,519
40,807
10,264

2021
£’000

18,454
20,863
22,913
36,712
9,659

124,330

108,601

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4 Segment information continued
The following table provides an analysis of the Group’s total assets by geographical location:

At 31 December

United Kingdom
Germany
France
Rest of Europe
United States of America
Israel

5 Profit from operations

Year ended 31 December

Profit from operations is arrived at after charging/(crediting):
Depreciation of property, plant and equipment
Amortisation of:
– acquired intellectual property rights and other intangible assets
– software intangibles
– development costs
Research and development costs expensed excluding regulatory costs
Cost of inventories recognised as expense
Write-down of inventories expensed
Staff costs

Net foreign exchange loss/(gain)

2022
£’000

151,817
78,877
11,934
16,670
451
21,345

2021
£’000

142,056
67,389
9,674
7,853
1,984
20,553

281,094

249,509

2022
£’000

2021
£’000

4,049

3,893

3,414
502
879
4,323
50,663
251
46,065

1,683

3,179
529
1,247
3,841
47,530
1
39,691

(2,017)

6 Exceptional items
During 2022, no costs have been incurred which are deemed to be exceptional in nature (2021: £nil). Whilst no exceptional
items have been incurred in the current or prior year, the Group treats exceptional items as a profit adjusted item when
calculating alternative performance measures.

7 Auditor's remuneration
Amounts payable to Deloitte LLP and their associates in respect of both audit and non-audit services:

Year ended 31 December

Fees payable to the Company's auditor and their associates for the audit of the
Company's annual accounts
Fees payable to the Company’s auditor and their associates for other audit
services to the Group and the audit of the Company's subsidiaries
Total audit fees
Audit related assurance services
Total non-audit fees

2022
£’000

276
299
34
34

333

2021
£’000

217
240
32
32

272

Fees payable to the Company’s auditor, Deloitte LLP and its associates, for non-audit services to the Company are not required
to be disclosed in subsidiaries’ accounts because the Consolidated Financial Statements are required to disclose such fees on
a consolidated basis.

A description of the work of the Audit Committee is set out in the Governance section of the Annual Report which includes
explanations of how the audit objectivity and independence is safeguarded when non-audit services are provided by
the Auditor.

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8 Employees
The average monthly number of employees of the Group during the year, including Executive Directors, was as follows:

Year ended 31 December

Production
Research and development
Sales and marketing
Administration

Year ended 31 December

Staff costs for all employees, including Executive Directors, consists of:
Wages and salaries
Social Security costs
Pension costs
Share-based payments (see Note 29)

9 Directors’ emoluments

Year ended 31 December

Remuneration for management services
Pension costs
Share-based payments

2022
Number

2021
Number

401
78
146
144

769

2022
£’000

37,131
4,998
1,497
2,439

46,065

2022
£’000

1,217
56
687

1,960

396
66
129
128

719

2021
£’000

31,903
4,402
1,407
1,979

39,691

2021
£’000

958
52
562

1,572

The Group’s highest paid Director is disclosed in the Remuneration Report on page 71.

Retirement benefits are accruing to the following number of Directors under money purchase schemes

10 Remuneration of Key Management Personnel
The key management of the Group comprises the Directors of the Group together with senior members of the management team.
Their aggregate compensation is shown below:

Year ended 31 December

Salaries, fees and short-term employee benefits
Pension costs
Share-based payments

11 Finance income

Year ended 31 December

Movement in Long-term liability credit
Bank interest

2022
£’000

2,427
112
1,101

3,640

2022
£’000

872
819

1,691

2021
£’000

2,040
106
891

3,037

2021
£’000

–
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12 Finance costs

Year ended 31 December

Amortisation of facility fees
Finance lease interest
Other interest
Movement in long-term acquisition liability expense

2022
£’000

272
327
39
33

671

2021
£’000

299
352
21
426

1,098

The long-term liability credit and long-term liability expense relate to movements in the long-term liabilities arising on
the acquisition of Sealantis in 2019 and AFS in 2022. The expense occurs as the liabilities unwind. (See Note 24 for further
information on how these liabilities are calculated.)

13 Taxation
The Group is subject to taxation in several jurisdictions and makes estimates of the taxation charges before completing tax
returns at a later date. The Group’s approach to transfer pricing is to apply OECD guidelines. Estimates are based on tax rates
enacted in law and calculations are prepared with the assistance of professional advisors. Therefore, the taxation charge is not
deemed to be a key source of estimation uncertainty.

a) Analysis of charge for the year

Year ended 31 December

Current tax:
Tax on ordinary activities – current year
Tax on ordinary activities – prior year

Deferred tax:
Tax on ordinary activities – current year
Tax on ordinary activities – prior year
Effect of increase in UK corporation tax rate

2022
£’000

5,655
6
5,661

(84)
(73)
–
(157)

2021
£’000

4,936
(323)
4,613

(490)
(190)
570
(110)

Tax charge for the year

5,504

4,503

b) Factors affecting tax charge for the year
The Group has chosen to use a weighted average country tax rate rather than the UK tax rate for the reconciliation of the
charge for the year to the profit per the Income Statement. The Group operates in several jurisdictions, some of which have
a tax rate in excess of the UK tax rate. As such, a weighted average country tax rate is believed to provide the most meaningful
information to the users of the Financial Statements.

The Group has applied the appropriate rate to the Deferred Tax Liability, measured using the tax rates that are expected to apply
when the liability is settled or the asset realised based on the tax rates that have been enacted or substantively enacted by the
balance sheet date.

The tax assessed for the year is lower (2021: lower) than the weighted average Group tax rate of 22.8% (2021: 23.0%) as
explained below:

Year ended 31 December

Profit before taxation
Weighted average Group tax rate 22.8% (2021: 23.0%)
Effects of:
Expenses not deductible for tax purposes and other timing differences
Utilisation and recognition of trading losses
Patent Box Relief
Net impact of deferred tax on capitalised development costs and R&D relief
Share-based payments
Adjustments in respect of prior year – current tax
Adjustments in respect of prior year and rate changes – deferred tax

Taxation

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2022
£’000

25,910
5,911

2021
£’000

21,984
5,053

243
(269)
(554)
32
208
6
(73)

7
–
(652)
(123)
161
(323)
380

5,504

4,503

o v e R v i e w

S t R At e g i c R e p oR t

g o v e R nAn c e

F I N A N C I A L S TAT e M e N T S

13 Taxation continued
In addition to the amounts charged to the Income Statement and the Statement of Comprehensive Income, the Group has
recognised directly in equity:

• Excess tax deductions related to share-based payments on exercised options.

• Changes in excess deferred tax deductions related to share-based payments, totalling £0.4 million surplus:

(2021: £0.5 million deficit).

14 Dividends
Amounts recognised as distributions to equity holders in the period:

Year ended 31 December

Final dividend for the year ended 31 December 2021 of 1.37p (2020: 1.20p) per Ordinary Share
Interim dividend for the year ended 31 December 2022 of 0.64p (2021: 0.58p) per Ordinary Share

Proposed final dividend for the year ended 31 December 2022 of 1.51p (2021: 1.37p) per Ordinary Share

2022
£’000

2,960
1,381
4,341

3,275

2021
£’000

2,579
1,266
3,845

2,960

The proposed final dividend is subject to approval by the shareholders and has not been included as a liability in these
Financial Statements.

15 Earnings per share
The calculation of basic and diluted earnings per share, based on statutory earnings and adjusted earnings, is based on the
following data:

Year ended 31 December

Weighted average number of Ordinary Shares for the purposes of basic earnings per share
Effect of dilutive potential Ordinary Shares: share options, Share Incentive Plan and LTIPs

Weighted average number of Ordinary Shares for the purposes of diluted earnings per share

Profit for the year attributable to equity holders of the parent
Amortisation of acquired intangible assets
Long term liability (credit)/expense

Adjusted profit for the year attributable to equity holders of the parent

Earnings per share

Basic
Diluted
Adjusted basic

Adjusted diluted

2022
000
Number of
shares

216,512
2,969

219,481

£’000

20,406
3,414
(840)

22,980

Pence

9.42
9.30
10.61

10.47

2021
000
Number of
shares

215,677
2,635

218,312

£’000

17,481
3,179
426

21,086

Pence

8.11
8.01
9.78

9.66

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Intangible assets

2022

Cost
At beginning of year
On acquisition
Additions
Disposals
Exchange differences
At end of year
Amortisation
At beginning of year
Charged in the year
Disposals
Exchange differences
At end of year
Net book value
At 31 December 2022

At 31 December 2021

Acquired
intellectual
property
rights
£’000

Other
intangible
assets
£’000

Development
and
recertification
Costs
£’000

Software
intangibles
£’000

13,021
–
–
–
566
13,587

3,903
80
–
81
4,064

9,523

9,118

26,015
3,948
–
–
2,066
32,029

6,759
3,334
–
634
10,727

21,302

19,256

5,740
–
73
(8)
70
5,875

3,633
502
(8)
59
4,186

1,689

2,107

Total
£’000

60,290
3,948
6,225
(8)
2,890
73,345

19,332
4,795
(8)
853
24,972

15,514
–
6,152
–
188
21,854

5,037
879
–
79
5,995

15,859

10,477

48,373

40,958

Acquired intellectual property rights were initially recognised on the acquisition of MedLogic Global Limited representing
patents and on the acquisition of RESORBA® representing brand names, know-how and customer listings and contracts. Other
intangible assets were recognised on the acquisition of Sealantis Limited and represent technological based know-how, on
the acquisition of Biomatlante S.A. which represent technological based know-how, patents and customer listings and on the
acquisition of Raleigh Adhesive Coatings Limited in 2020 relate to technological based know-how and customer listings arising
on the acquisition of Raleigh Coatings.

Other intellectual property rights on acquisition in 2022 relate to customer and marketing-related intangible assets arising on
the acquisition of AFS.

Intangible assets are amortised on a straight-line basis and the amortisation is recognised within administration costs, the largest
intangible asset being the RESORBA® brand name. The RESORBA® brand name has a carrying value of £9.2 million and is not
being amortised as the Directors believe it has an unlimited useful economic life. In reaching this assessment, the Directors have
considered that the RESORBA® brand has existed for over 80 years and is widely recognised as a market leader in the surgical
market. An asset is also recognised in respect of the GENTA-COLL® brand name and is being amortised over fifteen years with
five years remaining.

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Intangible assets continued

2021

Cost
At beginning of year
On acquisition
Additions
Disposals/impairment
Exchange differences
At end of year
Amortisation
At beginning of year
Charged in the year
Disposals/impairment
Exchange differences
At end of year
Net book value
At 31 December 2021

At 31 December 2020

Acquired
intellectual
property
rights
£’000

13,748
–
–
–
(727)
13,021

3,869
130
–
96
3,903

9,118

9,879

Other
intangible
assets
£’000

26,044
–
–
–
(29)
26,015

3,687
3,049
–
23
6,759

19,256

22,357

17 Property, plant and equipment

2022

Cost
At beginning of year
On acquisition
Additions
Disposals
Exchange adjustment
At end of year
Depreciation
At beginning of year
Provided for the year
Disposals
Exchange adjustment
At end of year
Net book value
At 31 December 2022

At 31 December 2021

Freehold land,
property and
improvements
£’000

Right-of-use
assets
£’000

Short
leasehold
improvements
£’000

Plant and
machinery
£’000

5,815
–
1,330
(5)
214
7,354

1,381
173
(5)
104
1,653

5,701

4,434

14,489
225
1,212
(955)
130
15,101

5,291
1,412
(955)
48
5,796

9,305

9,198

182
–
2
–
4
188

20
15
–
–
35

153

162

33,701
17
2,270
(316)
382
36,054

20,518
2,344
(288)
118
22,692

13,362

13,183

Software
intangibles
£’000

Development
costs
£’000

Total
£’000

56,623
–
4,695
(36)
(992)
60,290

14,582
4,955
(36)
(169)
19,332

11,202
–
4,441
–
(129)
15,514

3,834
1,247
–
(44)
5,037

10,477

7,368

40,958

42,041

Motor
vehicles
£’000

434
–
18
(51)
18
419

213
18
(43)
16
204

215

221

Total
£’000

55,648
242
4,951
(1,336)
771
60,276

28,207
4,049
(1,300)
305
31,261

29,015

27,441

5,629
–
254
(36)
(107)
5,740

3,192
529
(36)
(52)
3,633

2,107

2,437

Fixtures
and
fittings
£’000

1,027
–
119
(9)
23
1,160

784
87
(9)
19
881

279

243

Freehold land which has a carrying value of £1.3 million is not depreciated (2021: £1.3 million)

At 31 December 2022, the Group had entered into contractual commitments for the acquisition of property, plant and
equipment amounting to £0.4 million (2021: £0.4 million).

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17 Property, plant and equipment continued

2021

At 31 December 2020

Freehold land,
property and
improvements
£’000

Right-of-use
assets
£’000

Short
leasehold
improvements
£’000

Plant and
machinery
£’000

6,032
–
74
(3)
(288)
5,815

1,320
185
(3)
(121)
1,381

4,434

4,712

15,031
–
223
(500)
(265)
14,489

4,474
1,403
(500)
(86)
5,291

9,198

10,557

113
–
76
–
(7)
182

10
10
–
–
20

162

103

33,220
–
1,496
(415)
(600)
33,701

19,046
2,177
(415)
(290)
20,518

13,183

14,174

Fixtures
and
fittings
£’000

962
–
122
(28)
(29)
1,027

755
80
(28)
(23)
784

243

207

Motor
vehicles
£’000

684
–
–
(218)
(32)
434

373
38
(172)
(26)
213

221

311

18 Deferred tax
The following are the major deferred tax liabilities and assets recognised by the Group and movements thereon.

At 1 January 2021
Credit/(charge) to income
Credit to equity
Exchange adjustment
Acquisition of subsidiary
At 31 December 2021
Credit/(charge) to income
Charge to equity
Exchange adjustment
Acquisition of subsidiary

At 31 December 2022

Share-based
payments
£’000

Advanced
capital
allowances
£’000

Intangible
assets
£’000

Research and
development
Assets
£’000

1,043
616
503
–
–
2,162
(267)
(402)
–
–

1,493

(932)
(109)
–
–
–
(1,041)
192
–
–
–

(849)

(7,096)
233
–
195
–
(6,668)
638
–
(409)
(986)

(7,425)

(1,255)
(636)
–
–
–
(1,891)
(726)
–
–
–

(2,617)

Other
£’000

(296)
296
–
–
–
–
6
(201)
–
–

(195)

Total
£’000

56,042
–
1,991
(1,164)
(1,221)
55,648

25,978
3,893
(1,118)
(546)
28,207

27,441

30,064

Total
£’000

(8,536)
400
503
195
–
(7,438)
(157)
(603)
(409)
(986)

(9,593)

Certain deferred tax assets and liabilities have been offset where there is a legal, enforceable right to do so. The following is the
analysis of the deferred tax balances (after offset) for financial reporting purposes:

Deferred tax liabilities

2022
£’000

2021
£’000

(9,593)

(7,438)

At the Statement of Financial Position date, the Group has approximately £18.0 million of unused tax losses (2021: £12.3 million),
relating to tax losses in Israel, France and Austria available for offset against future profits. These have not been recognised in
the Statement of Financial Position as there is not currently sufficient evidence to prove that sufficient taxable profit will be
available to utilise these losses. The losses do not have time limits.

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19 Goodwill

Cost
At 1 January
Acquisitions
Exchange differences

At 31 December

2022
£’000

2021
£’000

66,032
1,452
3,375

70,859

68,911
–
(2,879)

66,032

The Group has two cash generating units (‘CGU’) whereby goodwill has been allocated (2021: two) and reports CGUs on
the same basis as the Group’s reportable segments (See note 4).

Following the acquisition of AFS in the year they have been deemed to be sufficiently integrated into the Surgical CGU.
See note 31 for details of assets arising on acquisition.

Goodwill in the Surgical CGU also arose on the acquisition of RESORBA® on 22 December 2011, the acquisition of Sealantis
Limited on 31 January 2019 and on the acquisition of Biomatlante SA on 30 November 2019.

Goodwill in the Woundcare CGU arose on the acquisition of Advanced Medical Solutions B.V. on 30 September 2009 and
on the acquisition of Raleigh Adhesive Coatings Limited on 23 November 2020.

The goodwill and intangible assets with indefinite useful economic life have been allocated to the relevant CGU based upon
the underlying identification of operations and assets to which the goodwill and intangible assets relate to.

The following table demonstrates the allocation and key assumptions used in management’s impairment test:

At 31 December 2022

Surgical CGU
Woundcare CGU

Consolidated

At 31 December 2021

Surgical CGU
Woundcare CGU

Consolidated

Discount rate

12.6%
12.6%

Long-term
growth rate

2.0%
2.0%

Discount rate

10.0%
10.0%

Long-term
growth rate

2.0%
2.0%

Intangible
assets with
indefinite
useful life
£’000

9,198
–

9,198

Intangible
assets with
indefinite
useful life
£’000

8,731
–

8,731

Carrying value
£’000

64,062
15,995

80,057

Carrying value
£’000

58,756
16,007

74,763

Goodwill
£’000

54,864
15,995

70,859

Goodwill
£’000

50,025
16,007

66,032

The Group tests goodwill annually for impairment, or more frequently if there are indications that goodwill might be impaired.

The recoverable amounts have been determined based on a value-in-use calculation on a CGU basis, which uses cash
flow projections based on financial budgets approved by the Directors covering a 12-month period. These budgets have
been adjusted for specific risk factors that take into account sensitivities of the projection. The base 12-month projection is
extrapolated using reasonable growth rates, specific to each CGU up to year five, of between 6% and 7%. A terminal value
calculation is then prepared to complete the value-in-use calculation using a 2% long-term growth rate. A discount rate of
12.6% per annum (2021: 10.0%), being the Group’s current pre-tax weighted average cost of capital adjusted for the risk of
each CGU, has been applied to these cash flows, being an estimation of current market risks and the time value of money.

The Group has conducted a sensitivity analysis on the impairment tests of both CGU's. The changes required to generate an
impairment charge within these CGUs are not considered to be reasonably possible changes and as such the assumptions are
not considered to give rise to a key source of estimation uncertainty.

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Inventories

At 31 December

Raw materials
Work in progress
Finished goods

2022
£’000

11,544
6,772
9,595

27,911

2021
£’000

7,859
4,969
6,472

19,300

There is no material difference between the replacement cost of stock and the amount at which it is stated in the
Financial Statements.

Included above are finished goods of £nil (2021: £nil) carried at net realisable value.

At 31 December

Total gross inventories
Inventory provision

Net inventory

2022
£’000

30,704
(2,793)

27,911

2021
£’000

21,602
(2,302)

19,300

The Group performs a detailed assessment of all inventory and provisions are made for items identified as obsolete or slow-moving.

21 Trade and other receivables

At 31 December

Current assets
Trade receivables
Other receivables
Prepayments and accrued income

Non-current assets
Derivative financial instruments
Prepayments and accrued income

Amount receivable for the sale of goods
Loss allowance

Net trade receivables

2022
£’000

2021
£’000

17,709
2,501
1,343

21,553

865
72

937

2022
£’000

17,984
(275)

17,709

17,515
1,688
1,813

21,016

25
80

105

2021
£’000

17,740
(225)

17,515

The Group’s principal financial assets are cash and trade receivables. The Group’s credit risk is primarily attributable to its
trade receivables.

No interest is charged on receivables within the contracted credit period. Thereafter, interest may be charged on the
outstanding balance. In determining the recoverability of a trade receivable the Group considers any change in the credit
quality of the trade receivable from the date credit was initially granted up to the reporting date. The concentration of credit
risk is limited due to the Group’s large and unrelated customer base. Accordingly, the Directors believe that there is no further
credit provision required in excess of the loss allowance.

Before accepting any new customer, the Group assesses the potential customer’s credit quality and defines credit limits by
customer. Limits are reviewed on an ongoing basis and reflect current payment history.

Receivables are written off when there is no reasonable expectation of recovery. Indicators that there may be no reasonable
expectation of recovery include ageing of the debt past 180 days, unwillingness to engage in correspondence and insolvency
events of the counterparty.

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21 Trade and other receivables continued
The Group believes that the unimpaired amounts that are past due are still collectible in full, based on historic payment
behaviour and extensive analysis of customer credit risk. A large proportion of debts overdue over 30 days were recovered
post the Statement of Financial Position date. The Group does not hold any collateral or other credit enhancements over these
balances. No expected credit loss provision is believed to be required for other receivables and accrued income. The carrying
amount and ageing of these debtors is summarised below:

Ageing of overdue but not impaired receivables

31 to 60 days overdue
61 to 90 days overdue
> 90 days overdue

Total

movement in loss allowance for trade receivables

Balance at the beginning of the year
Impairment losses recognised
Amounts written off as uncollectible
Amounts recovered during the year

Balance at the end of the year

2022
£’000

1,367
202
166

1,735

2021
£’000

1,821
218
7

2,046

Year ended
31 December
2022
£’000

Year ended
31 December
2021
£’000

225
218
(55)
(113)

275

196
146
(40)
(77)

225

Analysis of customers
In the year ended 31 December 2022, no customer accounted for more than 10% of the Group’s revenue (2021: no customer
with more then 10% revenue).

22 Cash and cash equivalents

Cash held at banks

2022
£’000

2021
£’000

82,262

72,965

Cash and cash equivalents comprise cash and short-term bank deposits with an original maturity of 90 days or less. The carrying
amount of these assets is approximately equal to their fair value.

23 Trade and other payables

Current liabilities
Trade payables
Other payables
Derivative financial instruments
Lease liabilities
Accruals and deferred income

Non-current liabilities
Other payables
Lease liabilities

2022
£’000

6,416
5,359
2,183
1,059
6,713
21,730

3,510
8,691

2021
£’000

4,878
3,623
46
1,153
6,411
16,111

3,679
8,707

12,201

12,386

Trade payables principally comprise amounts outstanding for trade purchases and ongoing costs.

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23 Trade and other payables continued
Other payables principally comprise amounts due in respect of payroll taxes, pension costs and indirect taxes yet to be remitted.
Accruals and deferred income principally comprise amounts outstanding for trade purchases and ongoing costs but not yet
invoiced and amounts received from customers but not yet recognised as revenue.

No interest is charged on trade payables that are within pre-agreed credit terms. Thereafter, interest may be charged on the
outstanding balances at various interest rates. The Group has financial risk management procedures in place to ensure that all
payables are paid within the pre-agreed credit terms.

The Directors consider that the carrying amount of trade payables approximates to their fair value.

24 Financial instruments
categories of financial instruments
All financial instruments held by the Group, as detailed in this Note, are classified as Trade and other receivables, Cash and cash
equivalents and Derivative instruments in designated hedge accounting relationships, ‘Financial Liabilities Measured at Amortised
Cost’ (trade and other payables and financial liabilities), ‘Derivative Instruments in Designated Hedge Accounting Relationships’
(cash flow hedges) and ‘Fair Value Through Profit and Loss (‘FVTPL’)’ under IFRS 9 ‘Financial Instruments’ and lease liabilities
under IFRS 16 ‘Leases’.

Financial assets
Trade and other receivables
Cash and cash equivalents
Derivative instruments in designated hedge accounting relationships
Financial liabilities
Derivative instruments in designated hedge accounting relationships
Financial liabilities measured at amortised cost

Lease liabilities

Carrying value

2022
£’000

2021
£’000

20,210
82,262
865

2,183
21,998

9,750

19,203
72,965
25

46
18,591

9,860

Within financial liabilities measured at amortised cost are liabilities which arose on the acquisition of Sealantis in 2019 and relate
to contingent consideration as well as amounts due to the Israeli Innovation Authority (‘IIA’).

Contingent consideration is based on future sales of existing products in development at the time of acquisition and are due
until the end of 2027. The liability is calculated based on the net present value of future sales projections with a 9.4% discount
rate applied. The discount rate used to calculate the liability is the Group’s weighted average cost of capital.

Royalties payable to the IIA are linked to grants received prior to acquisition and are a percentage of future sales of existing
products in development. The liability is calculated based on the net present value of future sales projections with a 9.4%
discount rate applied.

Amounts due to the IIA are payable based on a percentage of future sales and subject to at least 10% of manufacturing being
retained in Israel. The Group expects to continue to perform at least 10% of manufacturing in Israel of the relevant products.
The liability is calculated based on the net present value of future sales projections with a 9.4% discount rate applied on the
basis that the liability does not expire until the liability is settled.

Contingent consideration arose on the acquisition of AFS in respect of up to €1.5 million which is payable subject to EBITDA
delivery in 2022-2024.

The change in the valuation of the liabilities occur as the liabilities unwind and sales projections are updated. The movements
in the liabilities are recognised in finance income or costs (see Note 12).

The Group’s undrawn multi-currency facility with NatWest Bank PLC and HSBC UK Bank PLC expired in December 2022 and
has not been renewed.

The Risk Management section on pages 43 to 47 provides an explanation of the financial risks faced by the Group and the
objectives and policies for managing those risks including hedging practices adopted. The information below deals with the
financial assets and liabilities.

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24 Financial instruments continued
(a) Maturity of financial liabilities
The maturity profile of the Group’s financial liabilities, of which finance lease liabilities are at fixed rates and denominated in
Sterling whilst derivative financial instruments are non-interest bearing, is as follows:

At 31 December 2022

Trade and other payables
Lease liabilities
Financial derivatives

At 31 December 2022

At 31 December 2021

Trade and other payables
Lease liabilities
Financial derivatives

At 31 December 2021

On demand
or within
one year
£’000

18,488
1,059
2,183

21,730

On demand
or within
one year
£’000

14,912
1,146
46

16,104

Between
one and
two years
£’000

449
1,207
–

1,656

Between
one and
two years
£’000

58
983
–

1,041

Between
two and
five years
£’000

1,262
3,018
–

4,280

Between
two and
five years
£’000

988
2,693
–

3,681

Five
years
or more
£’000

1,799
4,466
–

6,265

Five
years
or more
£’000

2,633
5,038
–

7,671

Total
financial
liabilities
£’000

21,998
9,750
2,183

33,931

Total
financial
liabilities
£’000

18,591
9,860
46

28,497

The Group enters lease arrangements to acquire right-of-use assets, predominately relating to premises from which the Group
operates, vehicles and office equipment. Material leases include the lease of the Group’s headquarters, factory and distribution
centre in Winsford, UK and a factory in Etten-Leur, the Netherlands.

The Winsford leases were entered into in 2017 and expire in 2032. They have a total lease liability net present value of £6.5 million
(2021: £7.0 million) and attract increases at five-year intervals linked to market rate. The incremental borrowing rate is 4%.

The Etten-Leur lease was entered into in 2020 and expires in 2033 and has a lease liability net present value of £1.8 million
(2021: £1.8 million). Rent increases are indexed linked on an annual basis. The incremental borrowing rate is 0.62%.

(b) Interest rate and currency of financial assets
The Group’s interest rate risk is not considered to be a significant risk.

The currency and interest rate profile of the financial assets of the Group is as follows:

cash and cash equivalents

Currency
Sterling
US Dollar
Euro
Israeli Shekel

At 31 December 2022

Currency
Sterling
US Dollar
Euro
Israeli Shekel

At 31 December 2021

Floating
£’000

Non-interest
bearing
£’000

56,819
989
5,040
–

62,848

14,687
3,902
731
94

19,414

Floating
£’000

Non-interest
bearing
£’000

44,525
407
4,072
–

49,004

15,509
6,318
2,008
126

23,961

Total
£’000

71,506
4,891
5,771
94

82,262

Total
£’000

60,034
6,725
6,080
126

72,965

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24 Financial instruments continued
trade and other receivables
The Directors consider that the carrying amount of trade and other receivables approximates to their fair value.

Trade and other receivables excluding derivative instruments and prepayments are in the following currencies:

Sterling
US Dollar
Euro
Israeli Shekel

2022
£’000

5,983
7,776
6,405
46

2021
£’000

7,130
7,966
4,037
70

20,210

19,203

The financial assets all mature within one year. Credit risk is discussed in Note 21.

(c) Currency exposures
The Group hedges significant currency transaction exposure by using forward contracts, and aims to hedge approximately 80%
of its estimated transactional exposure for the next 18 months.

Risk sensitivity
The Group estimates that a 10% movement in the £:US$ or £:Euro exchange rate would have impacted 2022 Sterling revenues
by approximately 3.1% and 3.0% respectively and in the absence of any hedging this would have had an impact on profit margin
percentage of 2.5% and 0.3%.

Forward foreign exchange contracts
It is the policy of the Group to enter into forward foreign exchange contracts to cover specific foreign currency payments
and receipts.

The following table details the forward foreign currency contracts outstanding as at the year-end:

Outstanding contracts

Cash flow hedges
Sell US dollars
Less than 3 months
3 to 6 months
7 to 12 months
Over 12 months

Sell Euros
Less than 3 months
3 to 6 months
7 to 12 months
Over 12 months

Average contract rate

Foreign currency

Fair value

2022
USD:£1

2021
USD:£1

2022
USD ‘000

2021
USD ‘000

2022
£’000

2021
£’000

1.28
1.31
1.30
1.15

1.32
1.38
1.36
1.34

11,500
9,000
18,500
22,500

61,500

10,000
7,000
19,000
7,500

43,500

(540)
(550)
(1,040)
890

(1,240)

152
(114)
(184)
14

(132)

Average contract rate

Foreign currency

Fair value

2022
EUR:£1

2021
EUR:£1

2022
EUR ‘000

2021
EUR ‘000

2022
£’000

2021
£’000

1.14
1.15
1.15
1.14

1.11
1.15
1.15
1.14

600
600
1,200
1,200

3,600

700
900
1,800
600

4,000

(9)
(15)
(29)
(26)

(79)

43
24
32
12

111

The fair value amounts (classified under level two of the fair value hierarchy) presented above are the difference between the
market value of equivalent instruments at the Statement of Financial Position date and the contract value of the instruments.
No profits or losses are included in operating profit in the year (2021: £nil) in respect of FVTPL contracts. The loss of £1.3 million
(2021: £1.5 million loss) in respect of cash flow hedges has been taken to reserves.

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25 Fair value of financial assets and liabilities
The Directors consider that the fair value of the Group’s financial instruments do not differ significantly from their book values.

26 Foreign exchange rates
The Group uses the average of exchange rates prevailing during the period to translate the results and cash flows of overseas
subsidiaries into Sterling and period-end rates to translate the net assets of those entities. The currencies which most influence
these translations and the relevant exchange rates were:

Currency
US Dollar

Euro

27 Share capital

Number of Ordinary Shares of 5p each

At 1 January 2021
Share capital allotted for share schemes
At 31 December 2021
Share capital allotted for share schemes

At 31 December 2022

Average rate

Closing rate

Percentage change

2022

2021

2022

2021

Average
%

Closing
%

1.24

1.18

1.38

1.16

1.21

1.13

1.35

1.19

(10)

(11)

(5)

Allotted, called up
and fully paid
‘000

215,383
688
216,071
807

216,878

At the Statement of Financial Position date, 390,852 (2021: 371,498) shares are retained by the Trust to meet the matching
requirements of the scheme. For further information on the Share option plans, see Note 29.

Ordinary Shares of 5p each

At 1 January 2021
Share capital allotted for share schemes
At 31 December 2021
Share capital allotted for share schemes

At 31 December 2022

Allotted, called up
and fully paid
£’000

10,769
35
10,804
39

10,843

28 Reserves
investment in own shares
This is the nominal value of the shares held in trust on behalf of employees in respect of the Share Incentive Plan.

other reserve
This represents Advanced Medical Solutions Limited’s share premium account arising from merger accounting.

Hedging reserve
The hedging reserve represents the cumulative amount of gains and losses on hedging instruments deemed effective in cash
flow hedges. The cumulative deferred gain or loss on the hedging instruments are recognised in the Income Statement only
when the hedged transaction impacts the Income Statement or is included as a basis adjustment to the non-financial hedged
item, consistent with the applicable accounting policy.

Translation reserve
Exchange differences relating to the translation of the net assets of the Group’s foreign operations, which relate to subsidiaries
only, from their functional currency into the parent’s functional currency, being Sterling, are recognised directly in the translation
reserve. Gains and losses on hedging instruments that are designated as hedges of net investments in foreign operations are
included in the translation reserve.

A £6.9 million gain has been recorded in the translation reserve during the period, which would otherwise have been recognised
in Administration costs (2021: £5.2 million loss) if hedge accounting had not been adopted.

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29 Share-based payments
The charge for share-based payments under IFRS 2 arises across the following schemes:

Unapproved Executive Share Option Scheme and Company Share Option Scheme
Long-Term Incentive Plan
Share Incentive Plan and Deferred Annual Bonus Scheme

2022
£’000

441
1,218
780

2,439

2021
£’000

336
1,006
637

1,979

Unapproved executive Share option Scheme and company Share option plan (‘cSop’)
The fair value of the executive options is calculated based on a Black-Scholes Merton model assuming the inputs below:

Grant Date

Share price at grant date
Exercise price
Expected life
Contractual life
Risk free rate
Expected volatility
Expected dividend yield

Fair value of options

Grant Date

Share price at grant date
Exercise price
Expected life
Contractual life
Risk free rate
Expected volatility
Expected dividend yield

Fair value of options

26/04/2013

15/04/2014

19/09/2014

02/04/2015

18/04/2016

06/04/2017

77.5p
77.5p
3 yrs
10 yrs
0.36%
36%
0.7%

15p

115.75p
115.75p
3 yrs
10 yrs
0.80%
36%
0.7%

23p

121.75p
121.75p
3 yrs
10 yrs
0.80%
36%
0.7%

24p

132.0p
132.0p
3 yrs
10 yrs
0.80%
31%
0.7%

22p

184.6p
184.6p
3 yrs
10 yrs
0.67%
25%
0.4%

25p

246.7p
246.7p
3 yrs
10 yrs
0.18%
23%
0.4%

29p

13/04/2018

24/04/2019

14/04/2020

25/09/2020

23/04/2021

29/04/2022

308.0p
308.0p
3 yrs
10 yrs
0.94%
34%
0.7%

41p

328.75p
328.75p
3 yrs
10 yrs
0.75%
26%
0.4%

48p

239.00p
239.00p
3 yrs
10 yrs
0.08%
36%
0.6%

46p

214.50p
214.50p
3 yrs
10 yrs
0.08%
36%
0.6%

42p

257.0p
257.0p
3 yrs
10 yrs
0.12%
35%
0.6%

47p

304.0p
304.0p
3 yrs
10 yrs
1.64%
36%
0.7%

63p

Under the terms of the Company’s Share Option Schemes, approved by shareholders in 2019, the Board may offer options to
purchase Ordinary Shares in the Company to all employees of the Company at the market price on a date determined prior
to the date of the offer. Individuals who are entitled to awards under the LTIP are not eligible to receive options under the
Company’s Share Option Schemes.

Performance targets are assessed over a three-year period from the date of grant. Once options have vested they can be
exercised during the period up to ten years from the date of grant.

The expected volatility was determined by calculating the historic volatility of the Group’s share price over the previous
three years.

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Options have been granted over the following number of Ordinary Shares which were outstanding at 31 December 2022:

Date of
grant

Unapproved
Executive Share
Option Scheme
15/04/14
19/09/14
02/04/15
18/04/16
06/04/17
13/04/18
24/04/19
14/04/20
25/09/20
23/04/21
29/04/22
Company Share
Option Plan
26/04/13
15/04/14
02/04/15
18/04/16
06/04/17
13/04/18
24/04/19
14/04/20
23/04/21
29/04/22

Option
price (p)

115.75
121.75
132.00
184.60
246.70
308.00
328.75
239.00
214.50
257.40
303.90

77.50
115.75
132.00
184.60
246.70
308.00
328.75
239.00
257.40
303.90

Number of
options
as at
1 January
2022

Remaining
life (years)
1 January
2022

Issued

Lapsed

Exercised

Number of
options
as at
31 December
2022

Remaining
life (years)
31 December
2022

102,000
28,000
60,000
166,991
275,374
322,864
371,540
686,727
34,872
765,145
–

1,000
13,000
5,000
66,798
104,239
116,022
115,459
244,699
305,355
–

2.3
2.7
3.2
4.3
5.3
6.3
7.3
8.3
8.7
9.3
–

1.3
2.3
3.2
4.3
5.3
6.3
7.3
8.3
9.3
–

–
–
–
–
–
–
–
–
–
–
1,168,917

–
–
–
–
–
–
–
–
–
292,183

–
–
–
–
–
(73,143)
(71,128)
(74,500)
–
(38,207)
(66,279)

–
–
–
–
–
(14,843)
(10,083)
(11,149)
(40,043)
(24,441)

–
–
(10,000)
(48,399)
(39,209)
–
–
–
–
–
–

–
–
–
–
(32,084)
–
–
–
–
–

102,000
28,000
50,000
118,592
236,165
249,721
300,412
612,227
34,872
726,938
1,102,638

1,000
13,000
5,000
66,798
72,155
101,179
105,376
233,550
265,312
267,742

1.3
1.7
2.2
3.3
4.3
5.3
6.3
7.3
7.7
8.3
9.3

0.3
1.3
2.2
3.3
4.3
5.3
6.3
7.3
8.3
9.3

3,785,085

1,461,100

(423,816)

(129,692) 4,692,677

The weighted average remaining contractual life of the options outstanding at 31 December 2022 is 7.1 years (2021: 7.4 years).

The weighted average exercise price of options in the year was £2.78 (2021: £3.09)

Outstanding at beginning of the year
Issued
Exercised
Lapsed
Outstanding at end of the year

Exercisable at end of the year

2022
Number of
Options

3,785,085
1,461,100
(129,692)
(423,816)
4,692,677

2021
Number of
Options

3,151,338
1,106,500
(303,020)
(169,733)
3,785,085

1,449,398

1,261,288

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29 Share-based payments continued
Long Term Incentive Plan (‘LTIP’)
The fair value of the LTIP options is calculated using a monte carlo model assuming the inputs below:

Grant date

Share price at grant date
Exercise price
Expected life
Contractual life
Risk free rate
Expected volatility
Expected dividend yield

Fair value of option

Grant date

Share price at grant date
Exercise price
Expected life
Contractual life
Risk free rate
Expected volatility
Expected dividend yield

Fair value of option

06/06/2014

02/04/2015

10/09/2015

18/04/2016

06/04/2017

117.0p
0p
3 yrs
10 yrs
0.80%
36%
0.7%

85.9p

132.0p
0p
3 yrs
10 yrs
0.80%
29%
0.7%

64.4p

151.5p
0p
3 yrs
10 yrs
0.80%
27%
0.7%

75.5p

184.6p
0p
3 yrs
10 yrs
0.67%
25%
0.4%

159.0p

246.7p
0p
3 yrs
10 yrs
0.18%
23%
0.4%

220.0p

24/04/2019

14/04/2020

25/09/2020

23/04/2021

29/04/2022

328.8p
0p
3 yrs
10 yrs
0.75%
26%
0.4%

297.0p

239.0p
0p
3 yrs
10 yrs
0.08%
36%
0.6%

217.0p

214.5p
0p
3 yrs
10 yrs
0.08%
36%
0.6%

185.0p

257.4p
0p
3 yrs
10 yrs
0.12%
36%
0.6%

251.0p

280.5p
0p
3 yrs
10 yrs
1.64%
36%
0.7%

251.0p

The expected volatility was determined by calculating the historic volatility of the Group’s share price over the previous
three years.

The entitlement to shares under the LTIP is subject to achieving the performance conditions referred to on page 65.
The numbers shown are maximum entitlements and the actual number of shares issued (if any) will depend on these
performance conditions being achieved.

Date of grant

Long-Term Incentive Plan
06/06/14
02/04/15
10/09/15
18/04/16
06/04/17
24/04/19
14/04/20
25/09/20
23/04/21
29/04/22

Market
price at
date of
grant (p)

Number of
LTIPs at
1 January
2022

Remaining
life (years)
1 January
2022

Issued

Lapsed

Exercised

Number of
LTIPs at
31 December
2022

Remaining
life (years)
31 December
2022

117.00
132.00
151.50
184.60
246.70
328.75
239.00
214.50
257.40
303.90

38,450
99,270
146,939
206,578
123,007
389,875
581,153
22,476
599,824
–

2.4
3.2
3.7
4.3
5.3
7.3
8.3
8.7
9.3

–
–
–
–
–
–
– (146,939)
–
– (138,426)
–
(80,096)
–
–
(54,331)
– (307,227)
–
–
–
–
–
–
(2,000)
(35,500)
–
–
(11,200)
720,853

38,450
99,270
–
68,152
42,911
28,317
581,153
22,476
562,324
709,653

2,207,572

720,853

(353,927)

(421,792)

2,152,706

1.4
2.2
2.7
3.3
4.3
6.3
7.3
7.7
8.3
9.3

The weighted average exercise price of the Long-Term incentive Plan in the year was £2.75 (2021: £2.38)

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29 Share-based payments continued
The weighted average remaining contractual life of the LTIPs outstanding at 31 December 2022 is 7.7 years (2021: 7.2 years).

Outstanding at beginning of the year
Issued
Exercised
Lapsed
Outstanding at end of the year

Exercisable at end of the year

2022
Number of
Options

2,207,572
720,853
(421,792)
(353,927)
2,152,706

2021
Number of
Options

2,121,346
626,365
(76,733)
(463,406)
2,207,572

277,100

614,244

The exercise price of these options is £1 for each issue of LTIPs.

Share Incentive Plan (‘SIP’)
The fair value of the SIP shares are calculated based on a Black-Scholes Merton model assuming the inputs below:

Grant date

Share price at grant date
Exercise price
Expected life
Risk-free rate
Expected volatility
Expected dividend yield

Fair value of option

Grant date

Share price at grant date
Exercise price
Expected life
Risk-free rate
Expected volatility
Expected dividend yield

Fair value of option

Grant date

Share price at grant date
Exercise price
Expected life
Risk-free rate
Expected volatility
Expected dividend yield

Fair value of option

12/04/2007

02/05/2008

23/04/2009

05/05/2010

11/05/2011

10/05/2012

18.25p
0p
3.5 yrs
5.00%
27%
0%

14p

35.50p
0p
3.5 yrs
5.00%
38%
0%

30p

34.00p
0p
3 yrs
2.40%
30%
0%

72p

40.32p
0p
5 yrs
2.40%
34%
0%

61p

83.00p
0p
5 yrs
1.92%
18%
0.7%

72p

70.625p
0p
5 yrs
0.39%
34%
0.7%

61p

02/07/2013

30/04/2014

29/04/2015

03/05/2016

02/05/2017

13/04/2018

74.125p
0p
5 yrs
0.69%
36%
0.7%

63p

126.0p
0p
5 yrs
0.80%
36%
0.7%

110p

141.5p
0p
5 yrs
0.80%
31%
0.7%

124p

183.0p
0p
5 yrs
0.67%
25%
0.4%

160p

264.1p
0p
5 yrs
0.18%
23%
0.4%

233p

306.8p
0p
5 yrs
0.94%
25%
0.4%

266p

29/04/2019

05/05/2020

16/11/2020

11/05/2021

15/11/2021

12/05/2022

328.75p
0p
5 yrs
0.75%
26%
0.4%

296p

244.97p
0p
5 yrs
0.08%
36%
0.6%

253p

218.40p
0p
5 yrs
0.08%
36%
0.6%

190p

272.94p
0p
5 yrs
0.12%
36%
0.6%

238p

328.29p
0p
5 yrs
0.12%
36%
0.6%

288p

270.50p
0p
5 yrs
1.64%
36%
0.7%

251p

The expected volatility was determined by calculating the historic volatility of the Group’s share price over the previous
three years.

The entitlement to shares under the SIP is subject to a three-year holding period. Additionally, for certain levels of share
matching, additional performance conditions also need to be achieved. The actual number of shares that will be matched
will depend on these performance conditions being met. Details on the SIP are given on page 69.

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29 Share-based payments continued

Date of grant

Share Incentive Plan
12/04/07
02/05/08
23/04/09
05/05/10
11/05/11
10/05/12
02/07/13
30/04/14
29/04/15
03/05/16
02/05/17
13/04/18
29/04/19
05/05/20
16/11/20
11/05/21
15/11/21
12/05/22
02/11/22

Market
price at
date of
grant (p)

Number of
SIP matching
shares at
1 January
2022

18.25
35.50
34.00
40.32
83.00
70.63
74.13
126.00
141.50
183.00
264.10
306.77
328.75
244.97
218.40
272.09
328.29
270.50
270.53

6,759
9,415
15,351
12,400
3,176
7,600
38,720
31,882
53,573
101,957
111,492
142,751
213,701
342,043
93,971
280,827
95,553
–
–

Issued

Lapsed

Exercised

–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
459,634
86,001

–
–
–
–
–
–
–
–
–
–
–
–
(1,414)
(8,721)
(6,268)
(5,554)
(3,785)
(8,952)
–

–
–
–
–
–
(2,123)
(4,460)
(2,221)
(5,609)
(15,126)
(16,915)
(17,451)
(83,616)
(7,938)
(740)
(3,868)
(851)
(1,043)
–

Number of
SIP matching
shares at
31 December
2022

6,759
9,415
15,351
12,400
3,176
5,477
34,260
29,661
47,964
86,831
94,577
125,300
128,671
325,384
86,963
271,405
90,917
449,639
86,001

1,561,171

545,635

(34,694)

(161,961)

1,910,151

The weighted average exercise price of the Share Incentive Plan in the year was £2.75 (2021: £2.79).

Outstanding at beginning of the year
Issued
Exercised
Lapsed
Outstanding at end of the year

Exercisable at end of the year

The exercise price of the matching shares is £nil.

2022
Number of
Options

1,561,171
545,635
(161,961)
(34,694)
1,910,151

2021
Number of
Options

1,406,032
394,111
(189,478)
(49,494)
1,561,171

599,842

535,076

Deferred Annual Bonus Scheme (‘DAB’)
The fair value of the DAB options are calculated based on a Black-Scholes Merton model assuming the inputs below:

Grant date

21/05/2014

15/04/2015

18/04/2016

06/04/2017

13/04/2018

24/04/2019

29/04/2022

Share price at grant date
Exercise price
Expected life
Contractual life
Risk-free rate
Expected volatility
Expected dividend yield

Fair value of option

115.4p
0p
3 yrs
10 yrs
0.80%
31%
0.7%

115p

129.0p
0p
3 yrs
10 yrs
0.80%
31%
0.7%

129p

184.6p
0p
3 yrs
10 yrs
0.67%
25%
0.4%

183p

246.7p
0p
3 yrs
10 yrs
0.18%
23%
0.4%

250p

308.0p
0p
3 yrs
10 yrs
0.94%
25%
0.4%

308p

328.75p
0p
3 yrs
10 yrs
0.75%
26%
0.4%

329p

303.9p
0p
3 yrs
10 yrs
1.64%
36%
0.7%

252p

The expected volatility was determined by calculating the historic volatility of the Group’s share price over the previous
three years.

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29 Share-based payments continued
The DAB scheme began on 21 May 2014. Participants compulsorily defer part of their bonus for the relevant financial year and
they vest at the end of a three-year period from the time of grant.

Date of grant

Deferred Annual Bonus Plan
21.05.2014
15.04.2015
18.04.2016
06.04.2017
13.04.2018
24.04.2019
29.04.2022

Market
price at
date of
grant (p)

Number of
DAB matching
shares at
1 January
2022

Remaining
life (years)
1 January
2022

Issued

Lapsed

Exercised

Number of
DAB matching
shares at
31 December
2022

Remaining
life (years)
31 December
2022

115.40
129.00
184.60
246.70
308.00
328.75
303.90

520
6,095
5,971
9,168
29,910
32,769
–

84,433

2.3
3.3
4.3
5.3
6.3
7.3
–

–
–
–
–
–
–
18,268

18,268

–
–
–
–
–
–
–

–

–
–
–
–
(21,749)
(23,731)
–

(45,480)

520
6,095
5,971
9,168
8,161
9,038
18,268

57,221

1.3
2.3
3.3
4.3
5.3
6.3
9.3

Those senior executives who are required to defer a portion of their bonus did not receive a bonus in 2020 or 2021 and
therefore no Deferred Annual Bonus arose in those years.

The weighted average exercise price of the Deferred Annual Bonus Plan options in the year was £2.75 (2021: £2.55).

The weighted average remaining contractual life of the DAB options outstanding at 31 December 2022 is 6.0 years (2021: 6.2).

Outstanding at beginning of the year
Issued
Exercised
Lapsed
Outstanding at end of the year

Exercisable at end of the year

2022
Number of
Options

84,433
18,268
(45,480)
–
57,221

2021
Number of
Options

149,300
–
(64,867)
–
84,433

38,953

51,664

30 Related party transactions
Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation.
There are no other related party transactions to disclose.

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31 Acquisition
On 28 April 2022, the Group acquired the entire issued share capital of AFS Medical GmbH, an Austria-based distributor of
minimally invasive surgical devices.

In the eight-month period from acquisition to 31 December 2022, AFS contributed £3.7 million of net revenue to the Group
and a negligible amount of operating profit. In addition, amortisation of intangible assets of £0.3 million was recorded within
the Group as a result of the acquisition

Identifiable net assets acquired
Customer-related Intangible asset
Marketing-based Intangible asset
Property, plant and equipment
Trade and other receivables
Inventory
Cash and cash equivalents
Trade and other payables
Lease liabilities
Borrowings
Borrowings from AMS
Deferred tax on intangible asset
Goodwill arising on acquisition

Total net assets

£'000

3,424
524
242
296
845
42
(1,293)
(226)
(331)
(2,526)
(986)
1,452

1,462

Borrowings from AMS arose as funds were advanced prior to completion of the acquisition to repay external funding and
are included within acquisition of subsidiaries within the Consolidated Statement of Cash Flows. These borrowings are now
eliminated on consolidation. £0.3 million of borrowings that existed at the date of acquisition have been repaid prior to
31 December 2022 as disclosed in the Consolidated Statement of Cash Flows.

Satisfied by

Cash consideration
Contingent consideration

Net cash flow on acquisition

Cash consideration
Cash acquired

£'000

297
1,165

1,462

£'000

(297)
42

(255)

Contingent consideration arose on the acquisition in respect of up to €1.5 million which is payable subject to EBITDA delivery
in 2022-2024. £1.2 million is the estimated fair value of it as at the acquisition date.

None of the goodwill on the acquisition is expected to be deductible for income tax.

32 Events after reporting period
There have been no material events subsequent to 31 December 2022 with the exception of the acquisition of Connexicon
Medical Limited, announced in February 2023, for initial consideration of €7 million and with further deferred payments
dependent on the delivery of future research & development, regulatory and commercial milestones.

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C O M P A N Y S T A TeMeN T O F F I N A N C I A L P O S I T I O N
At 31 December 2022

Non current assets
Investments in subsidiaries
Trade and other receivables

Current assets
Trade and other receivables
Cash and cash equivalents

Current liabilities
Trade and other payables
Net current assets
Net assets
Equity shareholders’ funds
Share capital
Share premium
Share-based payments reserve
Investment in own shares
Retained earnings

Equity attributable to equity holders of the parent

Note

2022
£’000

2021
£’000

3
4

58,017
36,617
94,634

237
64,801
65,038

58,017
21,482
79,499

14,485
62,518
77,003

(12,637)
52,401
147,035

(11,838)
65,165
144,664

10,843
37,269
15,711
(167)
83,379

10,804
36,996
13,180
(164)
83,848

147,035

144,664

The Company reported total comprehensive income for the year ended 31 December 2022 of £3.9 million (2021: expense of
£0.2 million).

The Financial Statements of Advanced Medical Solutions Group plc (registration number 2867684) on pages 123 to 129
were approved by the Board of Directors and authorised for issue on 18 April 2023 and were signed on its behalf by:

Chris Meredith
Chief Executive Officer

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C O M P A N Y S T A TeMeN T O F C H A N GeS I N eQ U I T Y
For the year ended 31 December 2022

At 1 January 2021
Share-based payments
Share options exercised
Shares purchased by EBT
Shares sold by EBT
Total comprehensive expense
Dividends paid
At 31 December 2021
Share-based payments
Share options exercised
Shares purchased by EBT
Shares sold by EBT
Total comprehensive income
Dividends paid

At 31 December 2022

Share
capital
£’000

Share-based
payments
£’000

Investment in
own shares
£’000

10,769
–
35
–
–
–
–
10,804
–
39
–
–
–
–

10,843

11,142
1,979
59
–
–
–
–
13,180
2,439
92
–
–
–
–

15,711

(162)
–
–
(366)
364
–
–
(164)
–
–
(392)
389
–
–

(167)

Share
premium
£’000

36,288
–
708
–
–
–
–
36,996
–
273
–
–
–
–

37,269

Retained
earnings
£’000

87,859
–
–
–
–
(166)
(3,845)
83,848
–
–
–
–
3,872
(4,341)

Total
£’0001

145,896
1,979
802
(366)
364
(166)
(3,845)
144,664
2,439
404
(392)
389
3,872
(4,341)

83,379

147,035

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N O TeS T O T He C O M P A N Y F I N A N C I A L S T A TeMeN T S
Year ended 31 December 2022

1. Significant accounting policies
Basis of preparation
These Financial Statements were prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework
('FRS 101').

In preparing these Financial Statements, the Company applies the recognition, measurement and disclosure requirements of
International Financial Reporting Standards, but makes amendments where necessary in order to comply with Companies Act
2006 and has set out below where advantage of the FRS 101 disclosure exemptions has been taken. The Financial Statements
have been prepared on the historical cost basis of accounting except as disclosed in the accounting policies set out below.

As permitted by FRS 101, the Company has taken advantage of the disclosure exemptions available under that standard
in relation to share-based payments, financial instruments, capital management, presentation of a Cash Flow Statement,
presentation of comparative information in respect of certain assets, standards not yet effective, impairment of assets, business
combinations, discontinued operations and related party transactions.

critical judgements in applying the company’s accounting policies and areas of key estimation uncertainty
In the process of applying the Company’s accounting policies, which are described below, no judgements have been made by
the Directors, nor do any areas of key estimation uncertainty exist that have a significant effect on the amounts recognised in
the Financial Statements.

impairment of investments and intragroup receivables
Investments and receivables carrying values are reviewed for impairment if events or changes in circumstances indicate that
the carrying amount of an asset or cash-generating unit is not recoverable. Recoverable amount is the higher of fair value, as
supported by management valuation, less costs to sell and value-in-use. In assessing value-in-use, the estimated future cash
flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time
value of money and risks specific to the asset for which the estimates of future cash flows have not been adjusted.

investments in subsidiaries
Investments in subsidiaries are shown at cost less provision for impairment.

Foreign currencies
Transactions in currencies other than Pounds Sterling are recorded at the rates of exchange prevailing on the dates of the
transactions. At each Statement of Financial Position date, monetary assets and liabilities that are denominated in foreign
currencies are retranslated at the rates prevailing on the Statement of Financial Position date. Non-monetary items that are
measured in terms of historical cost in a foreign currency are not retranslated. Gains and losses arising on retranslation are
included in the Income Statement for the period.

taxation
Tax on the profit or loss for the period comprises current and deferred tax.

current tax
The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in profit or
loss because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items
that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted or
substantively enacted by the end of the reporting period.

Deferred tax
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial
reporting purposes and the amounts used for taxation purposes. Temporary differences in respect of the initial recognition of
assets and liabilities that affect neither accounting nor taxable profit are not provided for. The amount of deferred tax provided
is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates
enacted or substantively enacted at the reporting date.

trade and other creditors
Trade and other creditors are non-interest bearing and recognised initially at fair value. Subsequent to initial recognition they
are measured at amortised cost using the effective interest method.

Finance charges
Finance charges comprise interest payable on interest-bearing loans and borrowings and fair value losses on interest rate swap
derivative financial instruments. Finance charges are recognised in the Income Statement on an effective interest method.

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S T A TeMeN T S CO N T I N U E D
Year ended 31 December 2022

Financial instruments
Financial assets and financial liabilities are recognised in the Company’s Statement of Financial Position when the Company
becomes a party to the contractual provisions of the instrument. Financial assets are de-recognised when the contractual rights
to the cash flows from the financial assets expire or are transferred. Financial liabilities are derecognised when the obligation
specified in the contract is discharged, cancelled or expires.

Derivatives
The Company uses derivative financial instruments to hedge its exposure to currency risks arising from operational, financing
and investment activities. In accordance with its treasury policy, the Company does not hold or issue derivative financial
instruments for trading purposes. However, derivatives that do not qualify for hedge accounting are accounted for as trading
instruments. Derivative financial instruments are recognised initially at fair value and remeasured at each period end. The gain
or loss on remeasurement to fair value is recognised immediately in the Income Statement. The Company has elected not to
apply hedge accounting. Forward currency contracts are recognised at fair value in the Statement of Financial Position with
movements in fair value recognised in the Income Statement for the period. The fair value of the instruments is the estimated
amount that the Company would receive or pay to terminate the swap at the reporting date, taking into account current
interest rates and the respective risk profiles of the swap counterparties.

Derivatives are presented as assets when the fair values are positive and as liabilities when the fair values are negative.

A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the instrument is more
than 12 months and it is not expected to be realised or settled within 12 months.

Share-based payments
The Company has applied the requirements of IFRS 2 Share-based payments.

The Company issues equity-settled share-based payments to certain employees. Equity-settled share-based payments
are measured at fair value at the date of grant. The fair value determined at the grant date of the equity-settled share-
based payments is expensed on a straight-line basis over the vesting period. At each Statement of Financial Position date,
the Company revises its estimate of the number of equity instruments expected to vest as a result of the effect of non-market
based vesting conditions. The impact of the revision of the original estimates, if any, is recognised in the Income Statement
such that the cumulative expense reflects the revised estimates with a corresponding adjustment to the equity-settled
employee benefits reserve.

Income Statement

2.
As permitted by Section 408 of the Companies Act 2006, the Company has elected not to present its own Income Statement
for the year. Advanced Medical Solutions Group plc reported a profit for the financial year ended 31 December 2022 of profit
of £3.9 million (2021: loss of £0.2 million).

The Auditor’s remuneration for audit and other services is disclosed in Note 7 to the Consolidated Financial Statements.

The average number of employees in the year was 17 (2021: 16), all of whom were classified as Administration (2021: same).
The Directors’ remuneration is detailed in Note 9 to the Consolidated Financial Statements.

Staff costs for all employees, including Executive Directors, consists of:
Wages and salaries
Social Security costs
Pension costs
Share-based payments (see Note 29 to the Consolidated Financial Statements)

Year ended
31 December
2022
£’000

Year ended
31 December
2021
£’000

4,922
330
90
2,439

7,781

3,891
578
98
1,979

6,546

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Investments in subsidiaries

Cost
At 1 January 2022
At 31 December 2022
Provisions for impairment
At 1 January 2022
At 31 December 2022
Net book value
At 31 December 2022

At 31 December 2021

Investments
in subsidiaries
£’000

86,687
86,687

28,670
28,670

58,017

Shares in Group undertakings and loans to Group undertakings have been written down to recognise losses in
subsidiary Companies.

The following were subsidiary undertakings at the end of the year and have all been included in the consolidated accounts.

Name

Advanced Medical
Solutions Limited

Proportion of
voting rights
and Ordinary
Share capital
held

Country of
operation

England

100%

Nature of business

Registered address

Development and
manufacture of
medical products

Premier Park, 33 Road One, Winsford
Industrial Estate, Winsford, Cheshire,
CW7 3RT, United Kingdom

Advanced Medical Solutions
(UK) Limited

England

100%

Holding Company

Advanced Medical Solutions Trustee
Company Limited

England

100%

Trustee Company

Advanced Medical Solutions
(Plymouth) Limited

England

100%

Dormant

Advanced Healthcare
Systems Limited

England

100%*

Dormant

MedLogic Global Holdings Limited

England

100%*

Holding Company

Innovative Technologies Limited

England

100%‡

Dormant

Premier Park, 33 Road One, Winsford
Industrial Estate, Winsford, Cheshire,
CW7 3RT, United Kingdom

Raleigh Adhesive Coatings Limited

England

100%*

Advanced Medical Solutions BV

Netherlands

100%

Development and
manufacture of
medical products

Premier Park, 33 Road One, Winsford
Industrial Estate, Winsford, Cheshire,
CW7 3RT, United Kingdom

Development and
manufacture of
medical products

Munnikenheiweg 35,
4879 NE Etten-Leur, Netherlands

Advanced Medical Solutions
(Germany) GmbH

Germany

100%^

Holding Company

Resorba Medical GmbH

Germany

100%#

Development and
manufacture of
medical products

Am Flachmoor 16,
90475 Nuremberg, Germany

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N O TeS T O T He C O M P A N Y F I N A N C I A L
S T A TeMeN T S CO N T I N U E D
Year ended 31 December 2022

Name

Resorba s.r.o.

Proportion of
voting rights
and Ordinary
Share capital
held

100%#

Country of
operation

Czech
Republic

Resorba ooo

Russia

100%#

Advanced Medical Solutions Israel
(Sealantis) Limited

Israel

100%*

Biomatlante S.A

France

100%

Nature of business

Registered address

Manufacture and
sales office of
medical products

Haltravska No. 9/578, 34401,
Domazlice, Czech Republic

Distribution of
medical products

Fadeeva Str. 5, 125047
Moscow, Russia

Development and
manufacture of
medical products

Malat Building, Technion City,
Haifa, Israel 3200004

5, Rue Edouard Belin,
44360 Vigneux de Bretagne, France

MPN Medizin Produkte
Neustadt GmbH

Germany

100%#

Manufacture of
medical products

Sierkdorfer Str. 15, 23730,
Neustadt in Holstein, Germany

AFS Medical GmbH

Austria

100%*

Advanced Medical Solutions
(USA) Inc

USA

100%*

Advanced Medical Solutions
(Europe) Limited

England

100%

Distribution of
medical products

Gewerbepark B17/II, Straße 1/3,
2524 Teesdorf, Austria

Marketing support
of medical
products

2711 Centerville Road, Suite 400,
Wilmington, Newcastle, 19808,
Delaware, USA

Providing financial
support to other
Group entities

Premier Park, 33 Road One, Winsford
Industrial Estate, Winsford, Cheshire,
CW7 3RT, United Kingdom

* Held indirectly through Advanced Medical Solutions Limited.

‡ Held indirectly through MedLogic Global Holdings Limited.

^ s.291 of German Commercial Code invoked: No consolidated financial statements prepared for the German Companies.

# Held indirectly through Advanced Medical Solutions (Germany) GmbH.

The above table reflects the situation at the year-end.

The Company is the ultimate parent within the Group.

4. Trade and other receivables

Non-current assets

Amounts due from Group undertakings

Current assets
Prepayments and accrued income
Amounts due from Group undertakings
Derivative financial instruments

2022
£’000

2021
£’000

36,618

21,482

2022
£’000

237
–
–

237

2021
£’000

199
14,175
111

14,485

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4. Trade and other receivables continued

Amounts Owed by Group undertakings

At 1 January
Movement
At 31 December
Provisions for impairment
At 1 January
At 31 December
Net book value

At 31 December

2022
£’000

37,997
960
38,957

2021
£’000

48,924
(10,927)
37,997

2,340
2,340

36,617

35,657

Amounts owed by Group undertakings relates primarily to funds provided to Advanced Medical Solutions Limited, a related party,
to make acquisitions. The borrowings are typically repayable on demand and attract no interest. A revised facility was provided
to Advanced Medical Solutions Limited in 2022 of £40 million, reducing to £30 million on 31 December 2023. The Company also
acts as the central treasury hub providing short-term working capital and longer term funding to other Group entities depending
on the specific needs of the individual entity. All amounts due from intercompany undertakings are unsecured.

5. Creditors: amounts falling due within one year

Amounts owed to Group undertakings
Accruals and deferred income
Derivative financial instruments

2022
£’000

9,191
3,366
80

2021
£’000

8,929
2,909
–

12,637

11,838

Amounts due to Group undertakings are repayable on demand and attract no interest expense.

6. Share capital
Details of the share capital of the Company are provided in Note 27 on page 115 in the Notes to the Group’s accounts.

7. Share-based payments
The charge for share-based payments under IFRS 2 arises across the following schemes:

Unapproved Executive Share Option Scheme and Company Share Option Scheme
Long-Term Incentive Plan
Share Incentive plan and Deferred Annual Bonus Scheme

2022
£’000

441
1,218
780
2,439

2021
£’000

336
1,006
637
1,979

Details on the share-based payments of the Company are provided in Note 29 on pages 116 to 121 in the Notes to the
Group’s accounts.

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F Iv e YeAr S U M M Ar

Consolidated Income Statement
Revenue
Profit from operations (Pre-exceptional)
Profit attributable to equity holders of the parent
(Pre-exceptional)
Basic earnings per share (Pre-exceptional)

Consolidated Statement of Financial Position
Net assets employed
Non-current assets
Current assets
Total liabilities
Net assets

Shareholders’ equity
Share capital & investment in own shares
Share-based payments reserve
Share-based payments deferred tax reserve
Share premium account
Other reserve
Hedging reserve
Translation reserve
Retained equity

Equity attributable to equity holders of the parent

2022
£m

124.3
24.9

20.4
9.4p

149.2
131.9
(44.5)
236.6

10.7
15.7
0.5
37.3
1.5
(1.5)
5.0
167.4

236.6

2021
£m

108.6
23.0

17.5
8.1p

134.5
115.0
(36.8)
212.7

10.6
13.2
0.9
37.0
1.5
–
(1.9)
151.4

212.7

2020
£m

86.8
11.6

9.4
4.4p

141.4
97.2
(36.4)
202.2

10.6
11.1
0.4
36.3
1.5
1.2
3.3
137.7

202.2

2019
£m

102.4
25.3

20.0
9.3p

115.2
111.8
(35.7)
191.3

10.6
9.5
0.6
36.2
1.5
0.6
(0.2)
132.5

191.3

2018
£m

102.6
28.9

22.9
10.7p

86.0
119.2
(32.5)
172.7

10.5
7.3
0.7
35.2
1.5
(2.4)
3.3
116.6

172.7

Whilst no exceptional items have been incurred in the current or prior year, the Group treats exceptional items as a profit
adjusted item when calculating alternative performance measures.

Alternative performance measures
The Group’s performance is assessed using a number of financial measures which are not defined under IFRS and are therefore
non-GAAP (or alternative) performance measures. These are set out as follows:

• Constant currency measures revenue when excluding the effects of currency movements on non-pounds sterling sales.

• Adjusted measures are believed by the Directors to enable a reader to obtain a more effective year-on-year comparison and
fuller understanding of routine business operations since they exclude large, unusual or one-off activities, in particular as a
result of business combinations, which if included may distort the underlying performance of the business. The principles
to identify adjusting items have been applied to the current and prior year comparative numbers on a consistent basis.

• Adjusted profit before tax is shown before exceptional items which were £nil (2021: £nil), amortisation of acquired intangible
assets which was £3.4 million (2021: £3.2 million) and a long-term liability income of £0.8 million (2021: expense of £0.4 million)
as reconciled in the Financial Review (See page 41).

• Adjusted operating margin is shown before exceptional items and amortisation of acquired intangible assets as reconciled in

the Financial Review (See page 41).

• Margin percentages (which are calculated by dividing the relevant profit figure by revenue) for each of the relevant profit

metrics provide management with an insight into relative year-on-year performance.

• Adjusted earnings per share measures are derived from adjusted profit after tax with the rationale for their use being the same
as for adjusted profit metrics and are reconciled to their IFRS equivalent in note 15 to the consolidated financial statements.

• Adjusted net cash inflow from operating activities are derived from excluding items which are not reflective of the normal

course of business with the rationale for their use being the same as for adjusted profit metrics as reconciled in the Financial
Review (See page 41).

Further information regarding the profit adjusting items can be found in the notes to the Group Financial Statements:

• Exceptional items (Note 6).

• Amortisation of acquired intangible assets which was (Note 16).

• Change in long-term liabilities credit/expense (Note 12).

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A D vI S OrS

Nominated Advisor and Broker
Investec Bank plc
30 Gresham Street
London EC2V 7QN

Bankers
HSBC
99-101 Lord Street
Liverpool L2 6PG

Broker
HSBC
Level 2, 8 Canada Square
London E14 5HQ

Auditor
Deloitte LLP
Independent Auditor
The Hanover Building
Corporation Street
Manchester M4 4AH

Tax Advisor
Grant Thornton UK LLP
Landmark, St Peter’s Square
1 Oxford Street
Manchester M1 4PB

Registrars and Transfer Office
Computershare Registrars
The Pavilions
Bridgwater Road
Bristol BS13 8AE

NatWest
2nd Floor
1 Spinningfields Square
Manchester M3 3AP

Patent Attorneys
Marks & Clerk
Manchester Office
1 New York Street
Manchester M1 4HD

Foley & Lardner LLC
975 Page Mill Square
Palo Alto CA 94304-1013

Public Relations
Consilium Strategic
Communications
41 Lothbury
London EC2R 7HG

Annual Report & Accounts 2022 Advanced Medical Solutions Group plc

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N O TeS

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Advanced Medical Solutions Group plc Annual Report & Accounts 2022

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Advanced Medical Solutions Group plc

Registered Office:
Premier Park, 33 Road One
Winsford Industrial Estate
Winsford, Cheshire, CW7 3RT

Company number: 2867684

Tel: +44 (0)1606 863500
Tel: +44 (0)1606 863600
E-mail: info@admedsol.com