Trigg Mining Limited Annual Report 2011

FY2011 Annual Report · Trigg Mining Limited

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marketing group plc

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annual report and accounts
for the year ended 31 December 2011

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The Mission Marketing Group plc is a network of entrepreneurial communications Agencies spanning
14 offices, and uniting 700 people, across the UK.

The Group enables each Agency, its people and its Clients, to access skills, tools and buying power
in a collectively advantageous way, while freeing each Agency to express its unique personality.

Our Agencies have proven, long-term ability to help Clients win. They are driven by uncommonly talented
people whose creative business thinking and specialist knowledge complement those of their colleagues
around the Group. Between them, they have an impressive record of delivering tangible results for Clients.

We are proud to work with some of the world’s leading brands and the UK’s biggest names.

Our mission is simple: to work together to make our Clients’ brands and businesses more valuable;
and fuelled by their success, to grow the missiontm into the nation’s most respected and influential
creative communications group.

The tm graphic symbolises the shared ambitions, values
and goals that unite every Agency in the mission group.

The UK’s leading technology marketing Agency working with the world’s biggest
technology brands.

A full-service communications Agency with a national reputation for creative excellence.

A UK top 20 communications group with businesses specialising in brand development,
advertising, digital, media, direct response, PR, events and training.

A full service Agency specialising in automotive and retail.

The North of England’s premier integrated communications Agency.

An award-winning brand development and direct communications Agency.

The UK’s leading residential property marketing Agency and the largest buyer of estate
agency media in the country.

together, we are

The Mission Marketing Group plc Annual Report

Our basic structure

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R
O
T
C
E
S

A N N I N G

SPECIALIS

S KILLS

BUYING

TOOL S

SIGHT

R E S E

T
E
K
R
A
M

Pride & Passion

“the missiontm Agencies are professional and realistic, and all have an eye to the future. They exude pride
in their businesses and a passion to be best in class. I know that the Agencies, while trading in different
sectors and built on different kinds of expertise, are culturally very similar. All of them are doing things
well beyond the norm.”

David Morgan, Executive Chairman,
The Mission Marketing Group plc

The Mission Marketing Group plc Annual Report

Contents
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2011 Overview

Chairman’s Statement

Financial Review

Board of Directors

Report of the Directors

Corporate Governance

Independent Auditors’ Report

Consolidated Statement of Comprehensive Income

Consolidated Balance Sheet

Consolidated Cash Flow Statement

Consolidated Statement of Changes in Equity

Notes to the Consolidated Financial Statements

Independent Auditors’ Report: Company

Company Balance Sheet

Notes to the Company Balance Sheet

Notice of Annual General Meeting

Advisors

Annual General Meeting Form of Proxy

The Mission Marketing Group plc Annual Report

2011 Overview

2011 was an excellent year for . The objectives
we set in April 2010, on completion of the refinancing of the
Group, have all been delivered:

• Keep focus on core business, but look for new talent

and strategic in-fills;

• Increase profit by revenue growth and cost reduction; and

• Pay down debt by strong cash management and

preserving cash.

We have made real financial progress:
• Operating income (“revenue”) up 15% to £41.5m (2010: £36.1m)

• Headline operating profit up 19% to £5.8m (2010: £4.9m)

• Net finance costs reduced by 24% to £1.6m (2010: £2.1m)

• Headline profit before tax up 50% to £4.2m (2010: £2.8m)

• Headline Diluted EPS: 4.2 pence (2010: 3.0 pence)

• Cash inflow from operating activities of £5.1m

• Bank debt repayments of £4.5m, including £1.5m of

voluntary prepayment

• Net bank debt reduced by £3.1m to £15.3m

Operating income
(“revenue”) up 15%

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Headline profit
before tax up 50%

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net bank debt
reduced by £3.1m

And we have achieved our key performance targets:

Performance measure

Target

Achievement in 2011

Operating income

Increase year-on-year,
both via increased business
from existing Clients and
from new business wins

Operating profit
margins

Achieve levels at least in
line with industry averages

Ratio of net debt
to EBITDA

Reduce below x2 by end
of 2012

Net annualised new business
of £4.1m operating income
achieved in year.

Great new wins - e.g. Cisco,
Pitney Bowes, Highland Spring,
Peugeot Trade, Ferodo.

Strong Client retention and
growth from incumbent Clients-
e.g. BP, Bellway, Fairview, Domino’s
Pizza, M&S Money, Superdry.

Operating margins improved
to 14.1% (2010: 13.6%), above
industry average.

Central Office streamlined;
costs reduced 12%.

Debt leverage ratio reduced from
x3.3 in 2010 to x2.3 in 2011 and
expected to fall below x2 in first
half of 2012.

The Mission Marketing Group plc Annual Report

Chairman’s Statement
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Dear reader

I think our teams should be warmly congratulated for delivering a stellar performance in 2011 against a
very uncertain Market and financial back drop. By hitting their financial targets they have ensured that we
continue to stabilise the business by reducing our inherited debt and providing a platform from which
future growth can be encouraged.

Our three lead Agencies built on the gains they had made in 2010 whilst our smaller, yet perfectly formed
Agencies either maintained or grew, albeit from a smaller base. For example, critical wins at RLA have
established them as the leading player in the UK aftermarket automotive sector. Our focus on specialisation
has been even more highlighted by ThinkBDW, who are now the UK’s clear leader in the property marketing
sector and April-Six, who are fast becoming recognised as the B2B technology Agency of choice.

Significant Client wins throughout the year have bolstered overall performance but greatest credit to the
teams must go against their record of Client retention which, in a world of increased competition, shrinking
margins and uncertain budgeting, is no mean feat.

2011 also saw us increase our portfolio through strategic and service complementing in-fill acquisitions.
Either geographically, through Robson Brown in Newcastle, or by offering, through the social media
experts Yucca or our new colleagues from Fire IMS who have joined our flourishing Belfast Agency, RLA. In
November 2011 we established Bray Leino Vivactis, a business focused on the serious end of the Healthcare
sector. This new team was created via a firm co-operation with the mainland European Healthcare Group,
Vivactis, and by the hiring of top notch talent from leading Healthcare Agencies. We are very excited by
this venture and we have every confidence that it will create a new and refreshing option within this sector.
Early successes indicate that we will achieve our goal.

Looking into 2012 we are aiming for more of the same. Our focus will continue to be to pay down debt,
consolidate our Agencies, act more as one business where it is appropriate for our Clients who require that
depth of support, and to create new offerings wherever we see a strategic need or a business-enhancing
opportunity.

I believe that we have the people, the structure and the passion in place to take further our commitment
to being the most respected and regarded Agency group in the UK and that our forward momentum will
continue through 2012.

We have had a sound start to the year and I feel confident that through controlled growth we will have
a decent year ahead of us and will go into 2013 in even better shape as a business. It’s safe to say, therefore,
that we are predicting an exciting year for the missiontm, if not quite a lollapalooza.

David Morgan
Chairman
27 March 2012

The Mission Marketing Group plc Annual Report

together, we are

One of the UK’s leading technology Agencies.

April-Six is the resident business-to-business technology
specialist and we’re proud to serve some of the world’s
biggest technology brands. What makes us really stand
out is our passionate, can-do attitude and impeccable
Client service ethos, which makes light work of managing
the demands of complex subject matter, rapidly evolving
markets and global teams across geographies, languages,
cultures and time zones.

The promise: refreshingly different technology marketing.

With specialists in advertising, sales activation, digital and
PR, at Big we create big ideas for ambitious brands, using
real insight to truly engage.

Recent work has included the “It’s what we do” campaign
for Domino’s Pizza which rolled out across TV, press and
online banners. We also created an ‘industry first’ product
efficiency calculator app for JCB which highlights the
fuel efficiency and bottom line savings achieved when
using a JCB machine.

Our other Clients include Holland & Barrett, WKD,
Blockbuster and Samsung Mobile.

The Mission Marketing Group plc Annual Report

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Wise-up to roll-ups

Our aim was to encourage the estimated 300,000 roll-
up smokers in the South West of England to wise-up
to hand rolling tobacco. And to help them realise that
it’s just as bad as smoking ordinary cigarettes. The fact
that Smokefree South West ran out of ‘Quit Kit Wise-Up
Pouches’ twice during the campaign suggests we made
quite an impact.

Help tomorrow take shape

It was one of the biggest marketing challenges of the
decade. The brief for the 2011 Census campaign was to
reach every one of the 26 million households in England
and Wales, and to encourage them all to fill in their census
forms. With a 94% national response rate, outperforming
the previous census campaign held ten years ago, we
believe we succeeded.

Kia

Our longstanding relationship with Kia Motors in the
British Isles keeps going from strength to strength. Last
year saw the launch of the new Picanto supermini and for
the product rollout we produced some really stunning
work – direct mail, point-of-sale, press advertising, mini-
brochures, showroom vehicle graphics and customer
loyalty packs.

Scania

Dirt roads. Rocky roads. No roads. The new Scania Off-
road trucks are built with one simple focus: to reliably
move their customers and their customer’s business
ahead. In all conditions.

The one-piece solid steel bumper, the new high chassis
with air suspension and the Scania Opticruse with a new
Off-road mode. The trucks are full of new features that
enhance the driving experience and make the trucks
more robust than ever. The Scania Off-road trucks are
the toughest construction trucks they have ever built.
And to prove it – a photoshoot in a quarry in deepest
Hirwaun, Aberdare to put the trucks to the test. Watch out
for the video – coming soon on scania.co.uk.

The Mission Marketing Group plc Annual Report

together, we are

We invest in imagination, inventiveness and creativity.
We deliver ideas that get results for our clients… ideas
that work.

This year we have delivered rebranding for the national
education award organisation NCFE. We have helped
reduce smoking rates through a unique “Every breath”
campaign for Fresh Smokefree North East with the
backing of Sting. Sam’s Snaps campaign was launched
online for Balance to help protect children from the
effects of alcohol. We’ve ensured DFDS Seaways has
remained top of passengers’ minds in a turbulent
market, and developed a unique Sealy Beds sleep app
along the way too.

HSBC

Our campaign for HSBC’s expansion across Scotland
leveraged their USP of ‘Global expertise delivered locally’.
The campaign was delivered locally through 48 sheets
and delivered five times the volume of customers in the
first 3 months compared with other branch openings.

Highland Spring

Our recent work for Highland Spring sees us take the
Brand back onto television after a 5 year absence. The
campaign, “The Joys of Highland Spring”, focuses on
the fact that the water is drawn from organic land and
nothing but “mother nature touches it” from source to
bottle - TV, outdoor and sponsorship.

The Mission Marketing Group plc Annual Report

Marketing suite

When you’re a housebuilder trying to sell new homes,
making the right first impression really matters. From
concept to completion, we designed and manufactured
the ‘Pulse’ Marketing Suite for Fairview New Homes.

Information on Kew Bridge West

We established the identity and branding for this St James
development close to Kew Bridge, positioning it as a
prestigious development within easy reach of London’s
West End, the River and extensive parkland.

Designed to appeal to Far Eastern investors the marketing
resulted in a highly successful sales tour of Hong Kong,
Kuala Lumpur and Singapore.

The Mission Marketing Group plc Annual Report

Summary

Financial Review

The Group’s financial objectives articulated at the time of the refinancing in April 2010 were to focus on our
core business, to improve profitability through growth and cost reductions, and to pay down debt.

The results for 2011 again demonstrate our continued progress:

•

Increased revenue, from winning new Clients, developing existing Clients, and expanding via new
ventures, additional talent and strategic in-fill acquisitions;
•
Increased operating profits, from revenue growth and a reduction in central costs;
• Reduced net debt, gearing ratio and debt leverage, from a focus on cash management.

Trading, Statement of Income and Dividend

Turnover (Billings) was significantly higher than the previous year, at £116.0m (2010: £90.4m), reflecting
both the media launch of the 2011 Census (our largest ever project) and strong growth in media placement
activity handled by ThinkBDW, our property-specialist Agency.

Operating income (“revenue”) increased 15% to £41.5m (2010: £36.1m), mainly the result of strong growth
in ThinkBDW and RLA (our automotive-specialist Agency), and also the first contribution from Robson
Brown. As mentioned in the Chairman’s Statement, it was a good year for new business wins and Client
retention. Net new business revenue gained in the year totalled £4.1m, up from £2.8m last year. The lower
gross margin achieved in 2011 (36% vs 40% in 2010) reflects the higher proportion of media in the business
mix (44% of turnover vs 37% in 2010) as illustrated by the segmental analysis in Note 2.

Pre-exceptional operating profit increased by almost 20% to £5.8m (2010: £4.9m). Margins (operating profit as
a percentage of gross profit) in each part of the business held up remarkably well considering the continuing
downward pressure experienced by the industry as a whole and, after a further 12% year-on-year reduction
in central costs, the Group’s operating margin increased by 0.5% to 14.1%, ahead of the industry average.

The conversion of outstanding vendor debt to equity in June 2010 resulted in a reduction in both the level
of debt on which interest was being paid and also the average interest rate. Strong cash management during
the year further reduced levels of net debt, resulting in an overall 24% reduction in net interest payable to
£1.6m (2010: £2.1m).

After financing costs, pre-exceptional profit before tax increased by 50% to £4.2m (2010: £2.8m).

After exceptional costs of £0.1m, representing the completion of restructuring commenced last year (2010:
£1.2m relating to the bank refinancing, and redundancy and restructuring costs), profit before taxation was
£4.1m (2010: £1.6m) and the profit after tax was £3.1m (2010: £0.9m).

The headline diluted EPS was 4.2 pence (2010: 3.0 pence).

In line with our continuing focus on debt reduction, the Board does not propose the payment of a dividend.

Balance Sheet and Cash Flow

The major restructuring of the balance sheet was completed last year and, accordingly, changes to our
balance sheet have been less significant in 2011. However, predictions made in last year’s Financial Review
about improvements in operating cash flows and reductions in gearing, working capital and leverage
ratios have all been realised, resulting in a further strengthening of the balance sheet.

Particularly pleasing was the strong cash management during the year, which resulted in a further £0.5m
reduction in working capital despite the £26m increase in turnover. Cash flow from operating activities
was £5.1m (2010; £1.6m), enabling the repayment of bank loans totalling £4.5m, including a voluntary
prepayment of £1.5m to reduce interest costs, and a reduction in net debt to £15.3m (2010: £18.5m). As a
result, our gearing ratio (net debt to equity) reduced from 34% to 26%. As predicted, our “leverage ratio” (ratio
of net debt to pre-exceptional EBITDA) also reduced, from x3.3 at 31 December 2010 to x2.3 at 31 December
2011, and is expected to fall below x2 in the first half of 2012.

The Mission Marketing Group plc Annual Report

At 31 December 2011, the Board undertook its annual assessment of the value of goodwill, explained further
in Note 12, and concluded that no impairment in the carrying value was required. Capital expenditure, at
£1.5m, was roughly double 2010 levels as a result of the relocation of our Bristol and London offices and
the refurbishment of our Leicester office.

In addition to the Group’s principal focus on organic growth, £0.2m was invested in three small but
significant deals during the year, which bring strengths and opportunities to complement and enhance
our existing Agencies and the services we provide to our Clients:

• Creation of a new and very talented Healthcare Agency, Bray Leino Vivactis;
• Purchase of a thriving social media unit, Yucca; and
• Regional expansion by our specialist Automotive Agency, RLA.

Each of these deals demonstrates that we are executing our strategy of seeking new ventures, additional
talent and strategic acquisitions to accelerate growth, in a careful and selective way.

Treasury Policy

The Group’s operations are all based in the UK and substantially all the Group’s business is conducted in
the UK. Of those Clients based outside the UK, the majority are based in the USA and virtually all invoicing
is undertaken in sterling.

The Group’s policy is not to use any financial instruments for speculating but to use hedging of interest rates
and currencies selectively and only where considered cost-effective. Interest rate hedges entered into in
prior years, in a much higher interest rate era, expired in 2011 and have not yet been replaced. The Board will
re-assess the appropriateness of replacement hedges in the light of pricing from time to time.

Where turnover is in foreign currencies, natural hedges are used where possible, matching revenues and
costs in the same currency. Where this is not possible, appropriate currency hedging is considered.

The Group operates a virtual cash pooling arrangement where the cash balances of all the Group agencies
are pooled to offset any overdrafts and give the maximum net balance to invest. The maximum amount of
this net cash balance not needed for operational cash flow is placed on short term deposit.

Taxation

The Group’s effective tax rate was 25.0% (2010: 42.1%). The Group’s effective tax rate is normally above the
statutory rate due to non-deductible staff and client-related expenditure but, in 2011, the Group benefited
from the release of over-provisions made in prior years.

Key Performance Indicators

The Group manages its internal operational performance by monitoring various key performance indicators
(“KPIs’’). The KPIs are tailored to the level at which they are used and their purpose. The Group’s current
KPIs, which are quantified and commented on above, are: operating income, which the Group aims to
increase year-on-year both via increased business from existing Clients and from new business wins;
operating profit margins, where the Group aims to achieve levels at least in line with industry averages; and
the ratio of net debt to EBITDA, which the Group is aiming to reduce below x2.

At the individual Agency level, the Group’s KPIs comprise revenue and profitability measures, predominantly
the achievement of annual budget. More detailed KPIs are applied within individual Agencies.

Peter Fitzwilliam
Finance Director
27 March 2012

The Mission Marketing Group plc Annual Report

Board of Directors

David Morgan Executive Chairman
David founded Bray Leino, the Group’s largest agency, in 1974 and was its CEO until 2008. He became
Non-Executive Chairman of Bray Leino in 2008 and was appointed Chairman of the missiontm in April 2010.
Before founding Bray Leino he worked in a number of London advertising agencies including Dorlands.

Christopher Morris Non-Executive Deputy Chairman
Chris adds further operational experience to the Board as a founder partner of Big Communications
Group, bought by the missiontm in 2005 prior to its AIM listing in 2006. Chris has gained 30 years’ industry
knowledge having previously been Managing Director of Cogent Elliott, one of the UK’s top three regional
advertising agencies. Chris was appointed to the Board in December 2009.

Stephen Boyd Senior Independent Non-Executive Director
Stephen is currently Chairman of three AIM-listed companies, Pittards plc, Pure Wafer plc and Swallowfield
plc, in addition to holding a number of other Board positions. Stephen has a broad and extensive base
of experience in the UK, Europe, USA and overseas and brings additional depth in corporate finance.
Stephen was appointed to the Board in December 2009.

Dylan Bogg Executive Director
Dylan is Chief Executive of Big Communications and was one of the founding partners of the Agency.
He had built a successful business by the age of 24 and this was used as the bedrock for the launch of Big
Communications in 1996. Formerly Executive Creative Director of the Big Communications Group, he
still oversees all creative output. Dylan was appointed to the Board in April 2010.

Robert Day Executive Director
Robert is Chief Executive of ThinkBDW, a company he founded as Robert Day Associates in 1987 at the
age of 22. Re-branded ThinkBDW in 2004, Robert has led the company to its position as the leading
property marketing specialist in the UK. The business was acquired by the missiontm in March 2007 and
Robert joined the Board in April 2010.

Peter Fitzwillam Finance Director
Peter is a Chartered Accountant and has over 25 years of financial and management advisory experience
in both private and quoted companies across a range of industry sectors. He was Finance Director of
Business Post Group plc (now UK Mail Group plc) from 1999 to 2006 and helped take it into the FTSE
250. Peter supported the missiontm through its refinancing in April 2010 and was appointed to the Board
in September 2010.

Christopher Goodwin Executive Director
Chris is Chief Executive of RLA and has over 24 years in the automotive industry at Firestone and then
Federal-Mogul, with varied experience in sales, marketing and general management roles, both at
regional and global levels. In 2008 he crossed over from the Client side to focus on strategic business
development within Bray Leino. He was appointed to the Board on 27 April 2011.

Bruce Hutton Executive Director
Bruce is Chief Executive of Bray Leino, which he joined in 1997 after initially working in financial services
and then qualitative research. In 2002 Bruce was appointed to the management team, responsible for new
business and the inter-group cross fertilisation of Clients and services. After leading the business through
a reorganisation in 2004, Bruce was appointed Managing Director of the Agency and digital business.
Then in 2008 he was appointed to the newly created role of Group Chief Executive, which also included
responsibility for the PR, Events and Training divisions. He was appointed to the Board in April 2010.

Fiona Shepherd Executive Director
Fiona is Chief Executive of April-Six and has worked in the technology industry for over 20 years, holding
both Client and Agency positions and working with some of the world’s largest technology brands. Fiona
was a founder partner of April-Six in 2000, founded on a passion for technology and a strong belief in
customer centricity. Fiona joined the Board in April 2010.

The Mission Marketing Group plc Annual Report

Report of the Directors
for the year ended 31 December 2011

The Directors have pleasure in presenting their report and the financial statements of The Mission Marketing
Group plc (“the missiontm”) for the year ended 31 December 2011.

Principal Activities

The principal activities of the Group throughout the year continued to be marketing services, providing
national and international Clients with award winning marketing, advertising and business communications.

Business Review

The Agencies comprising the missiontm provide marketing communications and advertising services to
local, national and international businesses. A review of the business and future developments is provided
in the Chairman’s Statement and the Financial Review, which form part of this Report of the Directors.
Information concerning Key Performance Indicators is included within the Financial Review, and the
Group’s principal risks and uncertainties are discussed under Risk Management below.

Dividends

In line with the continuing focus on cash retention, the Board does not propose payment of a dividend.

Directors

The following Directors held office during the year;

Dylan Bogg
Stephen Boyd
Brian Child
Robert Day
Peter Fitzwilliam
Christopher Goodwin
Bruce Hutton
David Morgan
Christopher Morris
Fiona Shepherd

resigned 30 September 2011

appointed 27 April 2011

The Mission Marketing Group plc Annual Report

Directors’ Interests in Shares and Options

The interests of the Directors and their families in the ordinary shares of 10p each of the Company were
as follows:

Dylan Bogg
Stephen Boyd
Robert Day
Peter Fitzwilliam
Christopher Goodwin
Bruce Hutton
David Morgan
Christopher Morris
Fiona Shepherd

31 December 2011

31 December 2010 or
on appointment

1,167,373
300,768
5,574,929
432,181
172,485
1,699,713
5,844,150
874,909
1,216,123

883,453
230,768
6,305,603
287,181
-
1,215,459
5,844,150
767,409
1,216,123

The following unexercised options over shares were held by Directors:

Directors

1 January 2011
(or on appointment)

Granted

31 December
2011

Date from
which exercisable

Expiry date

Dylan Bogg

90,000*

90,000

July 2013

July 2019

60,000

July 2014

July 2021

Robert Day

60,000

July 2013

July 2020

Peter Fitzwilliam

Christopher Goodwin

157,000

July 2014

July 2021

50,000

July 2014

July 2021

20,000

July 2014

July 2021

Bruce Hutton

170,000*

53,000

170,000

July 2013

July 2019

53,000

July 2013

July 2020

200,000

July 2014

July 2021

Christopher Morris

55,000*

55,000

July 2013

July 2019

David Morgan

28,000

July 2014

July 2021

50,000

July 2014

July 2021

Fiona Shepherd

21,000

July 2013

July 2020

40,000

July 2014

July 2021

All share options in existence at 31 December 2011 are nil-cost options granted under the Company’s
Long Term Incentive Plan.

* The vesting conditions applying to options granted in 2009 were simplified to make them solely dependent
upon the achievement of profit targets over the three year period ending 31 December 2012, consistent
with options granted in 2010. Options granted in 2011 are solely dependent upon the achievement of profit
targets over the three year period ending 31 December 2013.

The Mission Marketing Group plc Annual Report

Substantial Shareholdings

Other than the Directors’ interests disclosed above, as at 27 March 2012, notification had been received of
the following interests in 3% or more of in the issued share capital of the Company:

Nicholas Bacon

Share Capital

Number of shares

2,449,648

3.38

The issued share capital of the Company at the date of this report is 72,460,444 Ordinary shares. The total
number of voting rights in the Company is 72,460,444. No shares were either issued or purchased by the
Company in the year.

Directors’ Responsibilities

The Directors are responsible for preparing the Annual Report and the Group financial statements in
accordance with applicable law and International Financial Reporting Standards as adopted by the
European Union, and the Company financial statements in accordance with applicable law and United
Kingdom accounting standards (United Kingdom Generally Accepted Accounting Practice).

International Accounting Standard 1 requires that financial statements present fairly for each financial
period the Group’s financial position, financial performance and cash flows. This requires the faithful
representation of the effects of transactions, other events and conditions in accordance with the definitions
and recognition criteria for assets, liabilities, income and expenses set out in the International Accounting
Standards Board’s “Framework for the Preparation and Presentation of Financial Statements”. In virtually
all circumstances, a fair presentation will be achieved by compliance with all applicable International
Financial Reporting Standards. A fair presentation also requires the Directors to:

- consistently select and apply appropriate accounting policies;
- present information, including accounting policies, in a manner that provides relevant, reliable,

comparable and understandable information; and

- provide additional 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.

Company law requires the Directors to prepare Group and Company financial statements for each financial
year. The Directors must not approve the financial statements unless they are satisfied they give a true and
fair view of the state of affairs of the Group and Company and the profit or loss of the Group for that period.
In preparing the financial statements of the Company under UK GAAP, the Directors are required to:

- select suitable accounting policies and then apply them consistently;
- make judgements and estimates that are reasonable and prudent;
- state whether applicable accounting standards have been followed, subject to any
material departures disclosed and explained in the financial statements; and
- prepare the financial statements on the going concern basis unless it is inappropriate
to presume that the Company will continue in business.

The Directors are responsible for keeping adequate accounting records that disclose with reasonable
accuracy at any time the financial position of the Group and the Company and enable them to ensure that
the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding
the assets of the Group and 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 Group’s website. Legislation in the United Kingdom governing the preparation and
dissemination of financial statements may differ from legislation in other jurisdictions.

Corporate Governance

The Directors provide a separate Corporate Governance Report, which forms part of this Report of
the Directors.

The Mission Marketing Group plc Annual Report

Risk Management

As part of its risk management strategy, the Board has a formal process of delegated authorities throughout
the Group and specific risks are reviewed at Board meetings. The Group sets, and keeps under review, key
performance indicators to monitor the past and future performance of the Group and each operating unit.

The Group’s principal operating risks and uncertainties are associated with the health of the UK economy
and the retention of key customers and staff. The fragile condition of the UK economy is well pubilcised;
there is a risk that a further downturn will have an adverse effect on the Group’s performance in the future.
The Group makes efforts to mitigate any adverse impact through strenuous new business activity and by
reducing overheads wherever possible, always recognising that there is a level below which overheads
cannot be reduced without customer service being affected. The risk of customer loss is mitigated by the
efforts of dedicated Client teams and also the Group’s broad spread of Clients, which limits its exposure
to any individual Client.

In common with all service businesses, the Group is reliant on the quality of its staff. Strenuous efforts are
made to provide a rewarding work environment and remuneration package to retain and motivate key
individuals. The system of financial rewards is reviewed regularly by the Board.

Details of specific financial risk management objectives and policies of the Group are set out in notes 1,
15 and 27 to the financial statements. The exposure of the Group to credit risk, liquidity risk, interest rate
risk and cash flow risk is also detailed in these notes, unless insignificant.

The Environment

The business of the Group is delivering marketing and advertising related services to Clients. The direct
and indirect impact of these services on the environment is negligible and considered low risk, however
we continue to take action to reduce our environmental impact where viable.

Directors’ Indemnity Insurance

As permitted by Section 233 of the Companies Act 2006, the Company has purchased insurance cover
on behalf of the Directors, indemnifying them against certain liabilities which may be incurred by them in
relation to the Company.

Post Balance Sheet Events

There were no material post balance sheet events.

Policy on Payments to Creditors

The Group does not have a standard code for dealing specifically with the payment of creditors. The Group
negotiates payment terms with its suppliers on an individual basis and settles its accounts in accordance
with those terms. Trade creditors at the year end represented 37 days purchases (2010: 37 days).

Employee Policies

It is the Group’s policy not to discriminate between employees or potential employees on any grounds.
The Group is committed to full and fair consideration of all applications. Selection of employees for
recruitment, training, development and promotion are based on their skills, abilities, and relevant
requirements for the job.

The Group places considerable value on the involvement of its employees and has continued its previous
practice of keeping them informed on matters affecting them as employees and on various factors
affecting the performance of the Group. Employees are consulted regularly on a wide range of matters
affecting their current and future interests.

Applications for employment by disabled persons are always fully considered, bearing in mind the aptitudes
and abilities of the applicant concerned. In the event of members of staff becoming disabled, every effort is
made to ensure their employment with the Group continues and that the appropriate training is arranged.
It is the policy of the Group that the training, career development and promotion of disabled persons
should, as far as possible, be identical to that of other employees.

The Mission Marketing Group plc Annual Report

Political and Charitable Donations

During the year the Group made charitable donations of £10,744 (2010: £16,369) to help support local
worthy causes, along with other regional and national charities. Various parts of the Group have also lent
their professional marketing expertise free of charge during the year to help charities raise their profile.
The Group did not make any political donations during the year.

Auditors

As part of the Board’s policy of periodically reviewing the quality and cost-effectiveness of its audit services, it
appointed Francis Clark LLP, a regional firm of accountants based in the South West, as the Group’s auditors
during the year to succeed Kingston Smith LLP. The partners and staff at Francis Clark LLP, many of whom
are ex-Big 4, have demonstrated a strong understanding of our sector and have indicated their willingness
to continue in office. In accordance with the provisions of the Companies Act 2006, it is proposed that they
be appointed auditors to the Group for the ensuing year.

Disclosure of Information to Auditors

So far as the Directors are aware, there is no relevant audit information of which the Group’s auditors are
unaware. The Directors have taken all steps that they ought to have taken as Directors in order to make
themselves aware of any relevant audit information and to establish that the Group’s auditors are aware
of that information.

Going Concern

The Directors have considered the financial projections for the Group, including cash flow forecasts, the
availability of committed bank facilities and the headroom against covenant tests for the coming 12 months.
They are satisfied that it is appropriate to adopt the financial statements on the basis that the Company
and Group have adequate resources for the foreseeable future. Therefore the Company and the Group
continue to adopt the going concern basis in preparing the financial statements.

Annual General Meeting

A notice convening the Annual General Meeting to be held on Monday 18 June 2012 at 12 noon is enclosed
with this report.

On behalf of the Board

Peter Fitzwilliam
Finance Director
27 March 2012

The Mission Marketing Group plc Annual Report

Corporate Governance

The Board of The Mission Marketing Group plc is collectively accountable to the Company’s shareholders
for good corporate governance. As an AIM-listed company, the missiontm is not required to comply with
the UK Corporate Governance Code (June 2010) (the “Code”) but complies as far as is practicable and
appropriate for a public company of its size and nature.

Board of Directors

At 31 December 2011, the Board consisted of an Executive Chairman, six Executive Directors and two
Non-Executive Directors. Following the refinancing completed in April 2010 and the resultant transition to
an operator-led focus, with the emphasis on organic growth and cost reductions, the Board considered
it appropriate to appoint the CEOs of each of the Group’s principal Agencies, most of whom are the
original founders of those Agencies, to the Board and to elect David Morgan, the founder of the Group’s
largest agency, as Executive Chairman. The Directors have re-considered the structure of the Board and
believe the structure established in 2010 remains appropriate. David Morgan is well regarded both within
the missiontm and within the industry and the Board continues to believe that, although combining the
roles of Chairman and Chief Executive does not meet “best practice” under the Code, his role as Executive
Chairman remains appropriate for the circumstances and that introducing a separate Chief Executive
would disturb the balance of an entrepreneurial Board, still largely comprising original Vendors.

Stephen Boyd and Christopher Morris are Non-Executive Directors and, although Chris provides some
consulting services to the Group, which are not significant in financial value, both are considered to be
independent of management by virtue of their attitude.

The Directors are collectively responsible for the strategic direction, investment decisions and effective
control of the Group. There is a schedule of matters reserved for Board approval which includes, amongst
other things, approval of the Group’s annual budget, acquisition of new subsidiaries, property leases,
significant acquisitions or disposals of fixed assets, and material Client contracts. The Board meets in
person at least six times each year and has regular telephonic and electronic contact in between meetings.

The Board is satisfied that it receives information of a quality and to a timetable that permits it to discharge
its duties.

All Directors are subject to election by Shareholders at the first opportunity after their appointment.
They are required to retire every three years and may seek re-appointment.

The Board has established three committees to deal with specific aspects of the Group’s affairs.

Audit Committee

The Audit Committee consists of the two independent Non-Executive Directors, with Stephen Boyd as
Chairman. The Committee considers matters relating to the reporting of results, financial controls, and the
cost and effectiveness of the audit process. It aims to meet at least twice a year with the Group’s external
auditors in attendance. Other Directors attend as required. The terms of reference of the Committee are
available on request.

The Audit Committee is satisfied that the Group’s auditors, Kingston Smith LLP during 2010 and for part
of 2011, and Francis Clark LLP following their appointment, have been objective and independent of the
Group. The Group’s auditors performed non-audit services for the Group as outlined in Note 7 but the
Audit Committee is satisfied that their objectivity and independence was not impaired by such work.

The Mission Marketing Group plc Annual Report

Remuneration Committee

The Remuneration Committee consists of the two independent Non-Executive Directors, with Stephen
Boyd as Chairman. The Committee determines the remuneration of the Executive Directors and makes
recommendations to the Board with regard to remuneration policy and related matters. The Board
maintains a policy of providing executive remuneration packages that will attract, motivate and retain
Directors of the calibre necessary to deliver the Group’s growth strategy and to reward them for enhancing
shareholder value.

The Executive Directors’ remuneration packages consist of three elements:

• basic salary and benefit package
• performance related bonus – the Group operates a performance-related bonus scheme, related

to the delivery of profit targets

• share option incentives – details of share options granted to the Executive Directors at the discretion
of the Remuneration Committee are shown in the Directors’ report.

Since Peter Fitzwilliam’s services as Chief Financial Officer are provided via VPF London Ltd, he is not eligible
for benefits, however as a director he is eligible for share option incentives and VPF London may receive
performance-related bonuses. The Remuneration Committee reviews the components of each Executive
Director’s remuneration package annually. The remuneration and terms and conditions of appointment of
the Non-Executive Directors are determined by the Board. No Director is involved in setting his or her own
remuneration. The Remuneration Committee meets as and when required. The terms of reference of the
Committee are available on request.

Nomination Committee

The Nomination Committee consists of the Group’s Executive Chairman, David Morgan, as the Committee
Chairman, and the two Non-Executive Directors. The Committee is responsible for reviewing and making
proposals to the Board on the appointment of Directors and meets as necessary. The terms of reference
of the Committee are available on request.

Summary of Directors’ Attendance

Board
meetings

Remuneration
Committee

Audit
Committee

Nomination
Committee

Entitled
to attend Attended

Entitled
to attend

Attended

n/a

Dylan Bogg

Stephen Boyd

Brian Child

Robert Day

Peter Fitzwilliam

Chris Goodwin

Bruce Hutton

David Morgan

Chris Morris

Fiona Shepherd

The Mission Marketing Group plc Annual Report

Shareholder Communications

The Group believes in good communication with shareholders. The Board encourages shareholders to
attend its Annual General Meeting. The Chairman and the Finance Director meet analysts and institutional
shareholders periodically in order to ensure that the strategy and performance of the Group are clearly
understood, and they provide the first point of contact for any queries raised by shareholders. In the event
that these Directors fail to resolve any queries, or where a Non-Executive Director is more appropriate, the
Senior Independent Director, Stephen Boyd, is available to meet shareholders.

Internal Financial Control

The Board is responsible for ensuring that the Group maintains a system of internal financial controls.
The objective of the system is to safeguard Group assets, ensure proper accounting records are maintained
and that the financial information used within the business and for publication is timely and reliable. Any
such system can only provide reasonable, but not absolute, assurance against material loss or misstatement.

The Board does not consider it would be appropriate to have its own internal audit function at the present
time, given the Group’s size and the nature of its business. At present the internal audit of internal financial
controls forms part of the responsibilities of the Group’s finance function.

All the day to day operational decisions are taken initially by the Executive Directors, in accordance with
the Group’s strategy. The Executive Directors are also responsible for initiating commercial transactions
and approving payments, save for those relating to their own employment.

The key internal controls include the specific levels of delegated authority and the segregation of duties;
the prior approval of all acquisitions; the review of pertinent commercial, financial and other information
by the Board on a regular basis; the prior approval of all significant strategic decisions; and maintaining
a formal strategy for business activities.

On behalf of the board

Peter Fitzwilliam
Finance Director
27 March 2012

The Mission Marketing Group plc Annual Report

Independent Auditors’ Report to the Members of The Mission Marketing Group plc

We have audited the financial statements of The Mission Marketing Group plc for the year ended 31 December
2011 which comprise the Consolidated Statement of Comprehensive Income, the Consolidated Balance
Sheet, the Consolidated Cash Flow Statement, the Consolidated Statement of Changes in Equity and the
related notes. The financial reporting framework that has been applied in their preparation is applicable law
and International Financial Reporting Standards (IFRSs) as adopted by the European Union.

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 for no purpose other than to draw to the
attention of the Company’s members those matters which we are required to include in an auditors’ report
addressed to them. To the fullest extent permitted by law, we do not accept or assume responsibility to
any party other than the Company and Company’s members as a body, for our work, for this report, or for
the opinions we have formed.

Respective responsibilities of directors and auditor

As explained more fully in the Directors’ Responsibilities Statement set out on page 16 the directors are
responsible for the preparation of the financial statements and for being satisfied that they give a true and
fair view. Our responsibility is to audit and express an opinion on the financial statements in accordance
with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us
to comply with the Auditing Practices Board’s (APB’s) Ethical Standards for Auditors.

Scope of the audit of the financial statements

An audit involves obtaining evidence about the amounts and disclosures in the financial statements
sufficient to give reasonable assurance that the financial statements are free from material misstatement,
whether caused by fraud or error. This includes an assessment of: whether the accounting policies are
appropriate to the Group’s circumstances and have been consistently applied and adequately disclosed;
the reasonableness of significant accounting estimates made by the directors; and the overall presentation
of the financial statements. In addition, we read all the financial and non-financial information in the annual
report to identify material inconsistencies with the audited financial statements. If we become aware of
any apparent material misstatements or inconsistencies we consider the implications for our report.

Opinion on financial statements

In our opinion the Group financial statements:

• give a true and fair view of the state of the Group’s affairs as at 31 December 2011 and of its

profit for the year then ended;

• have been properly prepared in accordance with IFRSs as adopted by the European Union; and
• have been prepared in accordance with the requirements of the Companies Act 2006.

Opinion on other matter prescribed by the Companies Act 2006

In our opinion the information given in the Directors’ Report for the financial year for which the consolidated
financial statements are prepared is consistent with the consolidated financial statements.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us
to report to you if, in our opinion:

• certain disclosures of directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.

Other matter

We have reported separately on the parent company financial statements of The Mission Marketing Group
plc for the year ended 31 December 2011.

Christopher Hicks BA FCA (Senior Statutory Auditor)
For and on behalf of Francis Clark LLP
Chartered Accountants and Statutory Auditors
Sigma House, Oak View Close, Edginswell,
Torquay TQ2 7FF
27 March 2012

The Mission Marketing Group plc Annual Report

Consolidated Statement of Comprehensive Income
For the year ended 31 December 2011

TURNOVER

Cost of sales

OPERATING INCOME

Operating expenses before exceptional items

OPERATING PROFIT BEFORE EXCEPTIONAL ITEMS

Exceptional items

OPERATING PROFIT

Investment income

Finance costs

IFRS interest charges

PROFIT BEFORE TAXATION

Taxation

PROFIT FOR THE YEAR

Other comprehensive income

TOTAL COMPREHENSIVE INCOME FOR THE YEAR

Basic earnings per share (pence)
Diluted earnings per share (pence)
Headline basic earnings per share (pence)
Headline diluted earnings per share (pence)

Year to
31 December
2011

Year to
31 December
2010

Note

£’000

11
11
11
11

116,044

(74,577)

41,467

(35,619)

5,848

(100)

5,748

(1,641)

4,112

(1,026)

3,086

4.35
4.10
4.45
4.20

90,364

(54,292)

36,072

(31,155)

4,917

(1,154)

3,763

(2,147)

(5)

1,617

(680)

937

1.67
1.59
3.16
3.00

The earnings per share figures derive from continuing and total operations.

The Mission Marketing Group plc Annual Report

Consolidated Balance Sheet
As at 31 December 2011

FIXED ASSETS
Intangible assets
Property, plant and equipment

CURRENT ASSETS
Stock and work in progress
Trade and other receivables
Cash and short term deposits

CURRENT LIABILITIES
Trade and other payables
Accruals
Corporation tax payable
Bank loans

NET CURRENT (LIABILITIES)/ASSETS

TOTAL ASSETS LESS CURRENT LIABILITIES

NON CURRENT LIABILITIES
Bank loans
Obligations under finance leases
Deferred tax liabilities

NET ASSETS

CAPITAL AND RESERVES
Called up share capital
Share premium account
Own shares
Staff remuneration reserve
Retained earnings

TOTAL EQUITY

Note

12
14

15
16

18
19
20

23
24

As at
31 December
2011

As at
31 December
2010

£’000

68,443
2,685

71,128

626
20,844
315

21,785

(10,378)
(8,117)
(820)
(4,000)

(23,315)

(1,530)

£’000

68,261
1,972

70,233

489
22,297
1,438

24,224

(8,687)
(10,726)
(342)
(3,000)

(22,755)

1,469

69,598

71,702

(11,641)
(40)
(1)

(11,682)

57,916

7,246
39,542
(1,234)
263
12,099

57,916

(16,903)
(96)
(2)

(17,001)

54,701

7,246
39,542
(1,259)
134
9,038

54,701

The financial statements were approved and authorised for issue on 27 March 2012 by the Board of Directors.
They were signed on its behalf by:

Peter Fitzwilliam
Director

Company registration number: 05733632

The Mission Marketing Group plc Annual Report

Consolidated Cash Flow Statement
for the year ended 31 December 2011

OPERATING CASH FLOWS
Net finance costs
Tax paid

Net cash inflow from operating activities

INVESTING ACTIVITIES
Proceeds on disposal of property, plant and equipment
Purchase of property, plant and equipment
Acquisition of subsidiaries
Acquisition of intangibles

Net cash outflow from investing activities

FINANCING ACTIVITIES
Repayments of acquisition liabilities
Movement in finance leases
Repayment of long term bank loans
Proceeds on issue of ordinary share capital
Financing and share issue costs

Net cash (outflow)/inflow from financing activities

(Decrease)/increase in cash and cash equivalents
Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

Consolidated Statement of Changes in Equity
Year ended 31 December 2011

Note

Year to
31 December
2011

Year to
31 December
2010

£’000

7,193
(1,566)
(496)

5,131

69
(1,552)
-
(190)

(1,673)

-
(68)
(4,513)
-
-

(4,581)

(1,123)
1,438

315

£’000

5,438
(2,583)
(1,229)

1,626

16
(664)
(52)
-

(700)

(945)
(69)
(12)
1,279
(22)

231

1,157
281

1,438

Share
capital
£’000

Share
premium
£’000

Own
shares
£’000

Staff
remuneration
reserve
£’000

Retained
earnings
£’000

Total
£’000

Changes in equity

At 1 January 2010

New shares issued
Credit for share option scheme
Shares awarded to employees
from own shares
Total Comprehensive Income
for the year

3,959

38,578

(1,398)

3,287
-

964
-

-
-

139

At 31 December 2010

7,246

39,542

(1,259)

Credit for share option scheme
Shares awarded to employees
from own shares
Total Comprehensive Income
for the year

-
74

134

129

8,220

49,419

-
-

4,251
74

(119)

937

9,038

54,701

129

(25)

3,086

At 31 December 2011

7,246

39,542

(1,234)

263

12,099

57,916

The Mission Marketing Group plc Annual Report

Notes to the Consolidated Financial Statements

1. Accounting Policies

Basis of preparation

The annual financial statements have been prepared in accordance with International Financial Reporting
Standards (IFRS) adopted by the European Union.

The financial statements have been prepared on the historical cost basis.

Going concern

The Group’s available banking facilities provide comfortable levels of headroom against the Group’s projected
cash flows and the Directors accordingly consider that it is appropriate to continue to adopt the going concern
basis in preparing these financial statements.

Basis of consolidation

The Group’s financial statements consolidate the financial statements of the Company and entities
controlled by the Company (its subsidiaries) made up to 31 December each year. Control is achieved
where the Company has the power to govern the financial and operating polices of an investee entity so
as to obtain benefits from its activities.

On acquisition, the assets and liabilities and contingent liabilities of a subsidiary are measured at their fair
values at the date of acquisition. Goodwill represents the excess of acquisition cost over the fair value
of the Group’s share of the identifiable net assets of the acquired subsidiary at the date of acquisition.
Any deficiency of the cost of acquisition below the fair value of the identifiable net assets acquired (i.e.
discount on acquisition) is credited to profit or loss in the period of acquisition.

The results of subsidiaries acquired or disposed of during the year are included in the consolidated
statement of comprehensive income from the effective date of acquisition or up to the effective date of
disposal, as appropriate.

Where necessary, adjustments are made to the financial statements of subsidiaries to bring accounting
policies used into line with those used by the Group.

All intra-group transactions, balances, income and expenses are eliminated on consolidation.

Revenue and revenue recognition

Turnover is in respect of the provision of services including fees, commissions, rechargeable expenses and
sales of materials performed subject to specific contracts. Where recorded turnover exceeds amounts
invoiced to Clients, the excess is classified as accrued income.

Income is taken on fee income in the period to which it relates. Project income is recognised in the period in
which the project is worked on. For projects which straddle the accounting year end, income is recognised
to reflect the partial performance of the contractual obligations in accordance with IAS 18 Revenue.

Income is recognised on the following basis:

• Retainer fees are apportioned over the time period to which they relate.
• Project income is recognised by apportioning the fees billed or billable to the time period for
which those fees were earned by relationship to the percentage of completeness of the project

to which they relate.

• Media commission is recognised when the advertising has been satisfactorily aired or placed.
• Unbilled costs relating to contracts for services are included at rechargeable value in

accrued income.

• Financial liabilities are released to income when the liability is extinguished.

The Mission Marketing Group plc Annual Report

Share-based payment transactions

The Group has applied the requirements of IFRS 2 Share-based Payments. IFRS 2 has been applied to all
grants of equity instruments.

Equity-settled share-based payments, such as share options, are measured at fair value at the date of
grant. The fair value determined at the grant date of the equity-settled share payments is expensed on a
straight-line basis over the vesting period, based on the Group’s estimate of the number of shares that will
eventually vest.

Fair value is measured by use of a Black Scholes model on the grounds that there are no market related
vesting conditions. The expected life used in the model has been adjusted, based on the management‘s
best estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations.
Market price on any given day is obtained from external publicly available sources.

Pension costs

Retirement benefits to employees are provided by defined contribution schemes that are funded by the
Group and employees. Payments are made to pension trusts that are financially separate from the Group.

Foreign currencies

Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the
balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange
ruling at the date of the transaction. Exchange differences are reflected in the profit or loss accordingly.

Goodwill and other intangible assets

Goodwill arising from the purchase of subsidiary undertakings represents the excess of the cost of
acquisition over the Group’s interest in the fair value of the identifiable assets, liabilities and contingent
liabilities of the subsidiary acquired, and is capitalised in accordance with the requirements of IFRS 3.
Future anticipated payments to vendors in respect of earn-outs are based on the Directors’ best estimates
of these obligations. Earn–outs are dependent on the future performance of the relevant business and
are reviewed annually. The deferred consideration is discounted to its fair value in accordance with IFRS
3 and IAS 39. The difference between the fair value of these liabilities and the actual amounts payable are
charged to profit or loss as notional finance costs over the life of the associated liability.

Goodwill is not amortised, but is reviewed annually for impairment. Goodwill impairment is assessed by
comparing the carrying value of goodwill for each cash-generating unit to the future cash flows, discounted
to their net present value using an appropriate discount rate, derived from the relevant underlying assets.
Where the net present value of future cash flows is below the carrying value of goodwill, an impairment
adjustment is recognised in profit or loss and is not subsequently reversed.

Other intangible assets purchased separately, or separately identified as part of an acquisition, are amortised
over periods of between 5 and 20 years.

The Mission Marketing Group plc Annual Report

Property, plant and equipment

Tangible fixed assets are stated at cost less accumulated depreciation. Depreciation is provided on all
property, plant and equipment at rates calculated to write off the cost, less estimated residual value based
on prices prevailing at the date of acquisition, of each asset evenly over its expected useful economic life,
as follows:

Short leasehold property
Motor vehicles
Fixtures, fittings and office equipment
Computer equipment

Period of the lease
25% per annum
10-33% per annum
25-33% per annum

Assets held under finance leases are depreciated over their expected useful lives on the same basis as
owned assets or, where shorter, the term of the relevant lease.

The gain or loss arising on the disposal of an asset is determined as the difference between the sales
proceeds and the carrying amount of the asset and is recognised in profit or loss.

Stock and work in progress

Stock and work in progress is stated at the lower of cost and net realisable value and includes the costs of
direct materials and purchases, and the costs of direct labour. Net realisable value is based on estimated
invoice value less further costs expected to be incurred to completion.

Deferred taxation

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 balance sheet liability method. Deferred tax liabilities are
generally recognised for all taxable temporary differences and deferred tax assets are recognised to the
extent 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 differences arise from
goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities
in a transaction that affects neither the tax profit nor the accounting profit.

Deferred tax liabilities are recognised for taxable temporary differences arising on investments in
subsidiaries, except where the Group is able to control the reversal of the temporary differences and it is
probable that the temporary difference will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at each balance sheet 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. Deferred tax is charged or credited in profit or loss, except when it relates to items
charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.

Deferred consideration

The terms of an acquisition may provide that the value of the purchase consideration, which may be
payable in cash, shares or other security at a future date, depends on uncertain future events, such as the
future performance of the acquired company. Where it is not possible to estimate the amounts payable
with any degree of certainty, the amounts recognised in the financial statements represent a reasonable
estimate at the balance sheet date of the amounts expected to be paid. The deferred consideration is
discounted to a fair value. The difference between the fair value of the liabilities and the actual amounts
payable are charged to the profit or loss as notional finance costs (calculated at annual rates of between
4.5% and 5.5%) over the life of the associated liability. The rate used is the risk free rate applicable at the
time of acquisition of the relevant entity.

The Mission Marketing Group plc Annual Report

Where it becomes appropriate to increase or decrease a previous estimate of deferred consideration, an
adjustment is made to the current year IFRS interest charge, such that the cumulative interest charged to
the date of change reflects the amount of interest charge that would have been expensed had the revised
estimate of the deferred consideration been made at the date that the liability was first recognised. By
so doing, the total interest expensed over the life of the liability is calculated as a function of the latest
expectation and is not influenced by any previous estimates whether higher or lower, and fully reflects the
intention of IFRS 3.

Financial instruments

Financial assets and financial liabilities are recognised on the Group’s balance sheet when the Group
becomes a party to the contractual provisions of the instrument. Issue costs are offset against the proceeds
of such instruments.

Liabilities and equity

Financial liabilities and equity instruments are classified according to the substance of the contractual
arrangements entered into. An equity instrument is any contract that evidences a residual interest in the
assets of the Group after deducting all of its liabilities. The Group has only one class of share in existence.

Finance costs

Finance costs, which include interest, bank charges and the unwinding of the discount on deferred
consideration, are recognised in profit or loss in the year in which they are incurred. Bank debt renegotiation
fees are amortised over the life of the loan facility.

Accounting estimates and judgements

The Group makes estimates and judgements concerning the future and the resulting estimates may, by
definition, vary from the actual results. The Directors considered the critical accounting estimates and
judgements used in the financial statements and concluded that the main areas of judgement are:

• Valuation of goodwill; and
• Revenue recognition policies in respect of contracts which straddle the year end.

The valuation of goodwill is based on estimates of future cash flows derived from the financial projections
of each cash-generating unit over an initial three year period and assumptions about growth thereafter,
discussed in more detail in note 12.

Revenue is recognised based on an estimate of the stage of completion of contracts which straddle the
year end, typically derived from the amount of time so far committed to those contracts in relation to the
total estimated time to complete them.

New standards, interpretations and amendments to existing standards

There are no material impacts arising from standards and interpretations applicable for the first time to
these financial statements, as detailed in the prior year financial statements.

The following IFRS and IFRIC Interpretations have been issued but have not been applied by the Group
in preparing these financial statements as they are not as yet effective. The Group intends to adopt these
Standards and Interpretations when they become effective, rather than adopt them early. None of these
Standards and Interpretations are anticipated to have a significant impact on the Group.

•
•
•
•
•

IFRS 9, ‘Financial instruments’, effective 1 January 2013
IFRS 10, ‘Consolidated financial statements’ effective 1 January 2013
IFRS 11, ‘Joint arrangements’ effective 1 January 2013
IFRS 12, ‘Disclosure of interests in other entities’ effective 1 January 2013
IFRS 13, ‘Fair value measurement’ effective 1 January 2013

The above standards have not yet been adopted by the European Union and therefore do not form part of
IFRS as adopted by the European Union.

A number of revised IFRSs and amendments to IFRSs are also currently in issue which are not relevant for
the Group’s activities and which have not therefore been adopted in preparing these financial statements.

The Mission Marketing Group plc Annual Report

2. Segmental Information

Business Segmentation

For management purposes the Group had seven operating subsidiaries during the period: April-Six
Limited, Big Communications Limited, Bray Leino Limited, Fuse Digital Limited, RLA Group Limited, Story
UK Limited and ThinkBDW Limited, each of which carries out a range of activities. These activities have
been divided into four business and operating segments as defined by IFRS 8 which form the basis of
the Group’s primary reporting segments, namely: Branding, Advertising and Digital; Media; Events and
Learning; and Public Relations.

Year to 31 December 2011

£’000

Branding,
Advertising
& Digital

Media

Events &
Learning

Public
Relations

Group

Turnover

Operating income

Segmental operating profit

Unallocated corporate expenses
Operating profit before
exceptional items
Other exceptional costs
Operating profit
Investment income
Finance costs
IFRS interest charges
Profit on ordinary activities before
taxation
Taxation
Profit for period

Other Information
Capital expenditure
Unallocated capital expenditure
Total capital expenditure

Depreciation and amortisation
Unallocated depreciation and
amortisation
Total depreciation and amortisation

Balance Sheet
Assets
Segment assets
Unallocated corporate assets
Consolidated total assets
Liabilities
Segment Liabilities
Unallocated corporate liabilities
Consolidated total liabilities

50,150

30,767

5,027

51,335

4,559

1,593

11,890

4,045

302

2,669

2,096

1,267

103

121

570

21,223

5,700

866

401

10,201

5,484

334

145

116,044

41,467

6,934

(1,086)

5,848

(100)
5,748
5
(1,641)
-

4,112

(1,026)
3,086

1,552
-
1,552

748

762

28,190
64,723
92,913

16,164
18,833
34,997

Consolidated net assets

11,022

216

532

256

57,916

Unallocated corporate expenses include corporate administration expenses necessary for a quoted
company. It is considered impractical to split the debt interest into segments.

The Mission Marketing Group plc Annual Report

The split of assets and liabilities has been estimated, as the businesses are integrated. Unallocated corporate
assets and liabilities include unallocated IFRS assets and liabilities, corporate assets and liabilities, Group
cash reserves and drawn debt liabilities.

Branding,
Advertising
& Digital

Media

Events &
Learning

Public
Relations

Group

Year to 31 December 2010

Turnover
Operating income
Segmental operating profit
Unallocated corporate expenses
Operating profit before
exceptional items
Other exceptional costs
Operating profit
Investment income
Finance costs
IFRS interest charges
Profit on ordinary activities
before taxation
Taxation
Profit for period

Other Information
Capital expenditure
Unallocated capital expenditure
Total capital expenditure

Depreciation and amortisation
Unallocated depreciation
and amortisation
Total depreciation and amortisation

Balance Sheet
Assets
Segment assets
Unallocated corporate assets
Consolidated total assets
Liabilities
Segment Liabilities
Unallocated corporate liabilities
Consolidated total liabilities

£’000

44,163
26,916
4,820

£’000

33,565
3,434
1,035

£’000

10,025
3,799
199

£’000

2,611
1,923
91

465

127

516

19,705

6,134

1,001

423

13,521

5,996

781

332

£’000

90,364
36,072
6,145
(1,228)

4,917

(1,154)
3,763
6
(2,147)
(5)

1,617

(680)
937

663
1
664

702

725

27,263
67,194
94,457

20,630
19,126
39,756

Consolidated net assets

6,184

138

220

54,701

Geographical Segmentation

The Group’s operations are all based in the UK and substantially all the Group’s business is executed in the UK.

The Mission Marketing Group plc Annual Report

3. Reconciliation of Headline Profit to Reported Profit

Headline profit before finance costs,
income from investments and taxation
Net finance costs

Headline profit before taxation

Adjustments
Exceptional items
IFRS interest charges

Reported profit before taxation

Headline profit before taxation
Headline taxation

Headline profit after taxation

Adjustments
Other exceptional costs
IFRS interest charges
Taxation impact

Reported profit after taxation

Year to
31 December
2011

Year to
31 December
2010

£’000

5,848
(1,636)

4,212

(100)
-

4,112

4,212
(1,053)

3,159

(100)
-
27

3,086

£’000

4,917
(2,141)

2,776

(1,154)
(5)

1,617

2,776
(1,003)

1,773

(1,154)
(5)
323

937

The IFRS interest charges relate to both the deferred consideration and the bank arrangement fees. In previous
years, headline profit was after adjusting for non-exceptional redundancy costs. In 2011, profits have only
been adjusted for exceptional items and the prior year has been adjusted accordingly.

4. Exceptional items

Bank refinancing costs
Restructuring costs

Year to
31 December
2011

Year to
31 December
2010

£’000

-
100

100

470
684

1,154

Exceptional items represent revenue or costs that, either by their size or nature, require separate disclosure
in order to give a fuller understanding of the Group’s financial performance.

Exceptional items in 2011 consist of restructuring costs. Exceptional items in 2010 comprise professional fees
relating to the re-structuring and re-scheduling of bank facilities and outstanding acquisition obligations,
including the equity conversion and placing of new shares, and amounts payable as a result of the restructuring
of the Board and the exit of vendor management following refinancing.

The Mission Marketing Group plc Annual Report

5. Investment Income

Interest on bank deposits

6. Finance Costs and IFRS Interest Charges

Finance costs:
Interest on bank loans and overdrafts
Interest on loan notes
Amortisation of bank debt renegotiation fees

IFRS interest charges:
Finance cost of deferred consideration

7. Profit on Ordinary Activities before Tax

Year to
31 December
2011

Year to
31 December
2010

£’000

Year to
31 December
2011

Year to
31 December
2010

£’000

(1,182)
-
(459)

(1,641)

(1,508)
(306)
(333)

(2,147)

(5)

Profit on ordinary activities before taxation is stated after charging/(crediting):

Depreciation of owned tangible fixed assets
Depreciation of tangible fixed assets held under finance leases
Amortisation of intangible assets
Loss/(profit) on disposal of property, plant and equipment
Operating lease rentals – Land and buildings
Operating lease rentals – Plant and equipment
Operating lease rentals – Other assets
Staff costs (see note 8)
Auditors’ remuneration
(Profit)/loss on foreign exchange

Year to
31 December
2011

Year to
31 December
2010

£’000

693
61
8
16
1,125
299
166
26,278
164
(7)

657
64
4
(14)
981
338
89
24,051
163
115

The Mission Marketing Group plc Annual Report

Auditors’ remuneration may be analysed by:

Audit
Taxation
Corporate Finance
Other services

Year to
31 December
2011

Year to
31 December
2010

£’000

99
19
38
8

164

120
20
-
23

163

Other services include review of the Group’s Interim Report, accounting advice on various International
Financial Reporting Standards and advice in relation to business issues. Figures for 2011 relate predominantly
to Francis Clark LLP and for 2010 relate to Kingston Smith LLP.

8. Employee Information

The number of Directors and staff employed by the Group during the year, analysed by segment,
was as follows:

Branding, Advertising & Digital
Media
Events and Learning
Public Relations
Central

The aggregate employee costs of these persons were as follows:

Wages and salaries
Social security costs
Pension costs
Share based payment expense
Payments for loss of office

Year to
31 December
2011
Number

Year to
31 December
2010
Number

475
40
111
37
3

666

409
29
107
35
3

583

Year to
31 December
2011

Year to
31 December
2010

£’000

22,896
2,500
753
129
-

26,278

20,468
2,150
618
94
721

24,051

The Mission Marketing Group plc Annual Report

Directors’ Remuneration

Included in the above are the following amounts (in £) paid to Directors for the periods in each year they
were TMMG plc Directors.

Salary /
Fees

Performance-
related
payments

Benefits

Pension

Total
31 December
2011

Total
31 December
2010

Current directors

Dylan Bogg
(from 14 April 2010)

Stephen Boyd
(note 2)

Robert Day
(from 14 April 2010)

140,500

29,166

133,046

40,000

Peter Fitzwilliam
(from 24 September 2010)

150,000

15,000

1,699

9,750

151,949

96,089

29,166

14,582

173,046

141,462

165,000

35,971

Chris Goodwin
(from 27 April 2011)

Bruce Hutton
(from 14 April 2010)

David Morgan
(from 14 April 2010)

Chris Morris
(note 4)

Fiona Shepherd
(from 14 April 2010)

Former directors

Tim Alderson
(to 15 April 2010)

Nick Bacon
(to 24 September 2010)

Brian Child
(to 30 September 2011)

Iain Ferguson
(to 15 April 2010)
Sue Mullen
(from 14 April to 16
November 2010)

Notes:

60,750

8,596

6,739

76,085

150,000

40,000

14,955

16,320

221,275

102,233

121,000

83,850

124,050

21,667

21,053

13,420

155,473

118,845

2,129

1,317

85,979

82,978

125,367

93,846

147,923

232,820

21,667

23,583

280,975

65,146

1,014,029

95,000 49,749

46,229

1,205,007

1,436,453

1. Dylan Bogg, Robert Day, Chris Goodwin, Bruce Hutton and Fiona Shepherd, were paid £nil as
TMMG plc Directors, but were paid as Directors and employees of subsidiary companies for services
rendered there.

2. The services of Stephen Boyd as a TMMG plc Director were provided through Stephen Boyd Ltd,

a company controlled by him.

3. Peter Fitzwilliam was paid £4,000 as a TMMG plc Director from 1 July 2011. In addition, his services as

CFO were provided by VPF London Ltd, a company controlled by him.

4. Chris Morris was paid £39,667 as a TMMG plc Director during the year (2010: £17,584). In addition,
he was paid for his consulting services through a consultancy practice owned by him, Morris Marketing
Consultancy.

5. The services of Brian Child as a TMMG plc Director were provided through Brain Child Marketing Ltd,

a company controlled by him.

The Mission Marketing Group plc Annual Report

9. Taxation

Current tax:
UK corporation tax at 26.5% (2010: 28%)
Adjustment for prior periods

Deferred tax:
Current year originating temporary differences
Adjustment for prior periods

Tax charge for the year

Year to
31 December
2011

Year to
31 December
2010

£’000

1,265
(288)

977

(2)
51

1,026

£’000

711
50

761

(82)
1

680

Factors Affecting the Tax Charge for the Current Year:
The tax assessed for the year is lower (2010: higher) than the standard rate of corporation tax in the UK.
The differences are:

Profit before taxation

Profit on ordinary activities before tax at the standard rate
of corporation tax of 26.5% (2010: 28.0%)

Effect of:
Non-deductible expenses
Adjustments to prior periods
Movement on provisions
IFRS charges
Other differences

Actual tax charge for the year

10. Dividends

Year to
31 December
2011

Year to
31 December
2010

£’000

4,112

1,090

188
(237)
(6)
(4)
(5)

1,026

£’000

1,617

453

224
50
5
1
(53)

680

In line with the continuing focus on cash retention, the Board does not propose payment of a dividend
(2010: nil).

The Mission Marketing Group plc Annual Report

11. Earnings Per Share

The calculation of the basic and diluted earnings per share is based on the following data, determined
in accordance with the provisions of IAS 33: Earnings per Share.

Earnings

Earnings for the purpose of reported earnings per share being net
profit attributable to equity holders of the parent

Earnings for the purpose of headline earnings per share
(see note 3)

Number of shares

Year to
31 December
2011

Year to
31 December
2010

£’000

3,086

3,159

937

1,773

Weighted average number of ordinary shares for the purpose
of basic earnings per share

70,944,643

56,024,579

Dilutive effect of securities:

Employee share options

Bank warrants

2,007,832

1,355,879

2,333,434

1,662,172

Weighted average number of ordinary shares for the purpose
of diluted earnings per share

75,285,909

59,042,630

Reported basis:

Basic earnings per share (pence)

Diluted earnings per share (pence)

Headline basis:

Basic earnings per share (pence)

Diluted earnings per share (pence)

4.35

4.10

4.45

4.20

1.67

1.59

3.16

3.00

Basic earnings per share includes shares to be issued subject only to time as if they had been issued at the
beginning of the period.

A reconciliation of the profit after tax on a reported basis and the headline basis is given in note 3.

12. Intangible Assets

Goodwill

Cost
At 1 January
Adjustment to consideration
At 31 December

Impairment adjustment
At 1 January and 31 December

Year to
31 December
2011

Year to
31 December
2010

£’000

72,186
-
72,186

72,135
51
72,186

3,995

Net book value at 31 December

68,191

The Mission Marketing Group plc Annual Report

The adjustment to consideration in 2010 related to changes in the estimated deferred consideration under
the terms of the relevant sale and purchase agreement.

In accordance with the Group’s accounting policies, an annual impairment test is applied to the carrying
value of goodwill and other intangible assets. The review performed assesses whether the carrying value
of goodwill is supported by the net present value of future cash flows derived from the underlying assets
considering forecast cash flows over an initial projection period of three years for each cash-generating
unit. After this period, an annual growth rate of 2.5% was assumed for all units. The discount rate used
is the Group’s estimated pre-tax weighted average cost of capital, which is 7%. Similarly the cash flow
projections used in the calculations are pre-tax.

Goodwill arose from the acquisition of the following subsidiary companies and is comprised of the following
substantial components:

April-Six Ltd
Big Communications Ltd/Fuse Digital Ltd
Bray Leino Ltd
RLA Group Ltd
Story UK Ltd
ThinkBDW Ltd

Other Intangible Assets

Cost

At 1 January

Additions

At 31 December

Amortisation

At 1 January

Charge for the year

At 31 December

Net book value

31 December
2011

31 December
2010

£’000

9,411
8,125
30,831
6,572
6,969
6,283

68,191

9,411
8,125
30,831
6,572
6,969
6,283

68,191

Year to
31 December
2011

Year to
31 December
2010

£’000

190

271

252

Other intangible assets consist of intellectual property rights. Additions of £190,000 in the year relate to
client lists and other information acquired relating to FireIMC and Yucca.

The Mission Marketing Group plc Annual Report

13. Subsidiaries

The Group’s principal trading subsidiaries are listed below. All subsidiaries are 100% owned and all are
incorporated in the United Kingdom.

Subsidiary Undertaking

Nature of Business

Big Communications Limited

Brand planning and strategic development

Fuse Digital Limited

Bray Leino Limited

ThinkBDW Limited

April-Six Limited

Story UK Limited

RLA Group Limited

Robson Brown Limited
(formerly Triang Marketing Limited)

14. Property, Plant and Equipment

Cost or valuation
At 1 January 2010
Additions
Disposals

At 31 December 2010
Additions
Disposals

At 31 December 2011

Depreciation
At 1 January 2010
Charge for the Year
Disposals

At 31 December 2010
Charge for the Year
Disposals

At 31 December 2011

Net book value at 31 December 2011

Net book value at 31 December 2010

New media marketing, including website design and
advertising, SMS messaging, digital video and database
management

Advertising, events and PR

Property marketing, providing advertising, media, brochures,
signage, exhibitions, CGI, animation, intranet, photography

Integrated communications, specialising in the technology
sector

Brand development and creative direct communication

Marketing and communications

Short
Leasehold
Property

Fixtures
& Fittings
and Office
Equipment

Computer
Equipment

Motor
Vehicles

£’000

1,378
85
(74)

1,389
204
(3)

1,590

905
97
(74)

928
100
(3)

1,025

565

461

2,174
69
(74)

2,169
388
(368)

2,189

1,373
177
(73)

1,477
200
(316)

1,361

828

692

2,448
474
(501)

2,421
945
(374)

2,992

1,791
396
(501)

1,686
409
(342)

1,753

1,239

735

290
36
(63)

263
15
(39)

239

190
51
(62)

179
45
(38)

186

Total

£’000

6,290
664
(712)

6,242
1,552
(784)

7,010

4,259
721
(710)

4,270
754
(699)

4,325

2,685

1,972

The net book amount includes £203,000 (2010: £219,000) in respect of assets held under finance lease
agreements. The depreciation charged to the financial statements in the year in respect of such assets
amounted to £61,000 (2010: £64,000.

The Mission Marketing Group plc Annual Report

15. Trade and Other Receivables

Gross trade receivables
Less: Provision for doubtful debts

Other receivables
Prepayments and accrued income
Deferred tax asset

31 December
2011

31 December
2010

£’000

17,098
(93)

17,005

437
3,392
10

20,844

15,668
(156)

15,512

224
6,499
62

22,297

An allowance has been made for estimated irrecoverable amounts from the provision of services of
£93,000 (2010: £156,000). The Directors consider that the carrying amount of trade and other receivables
approximates their fair value.

Credit Risk

The Group’s principal financial assets are bank balances and cash, trade and other receivables and investments,
which represent the Group’s maximum exposure to credit risk in relation to financial assets.

The Group’s credit risk is primarily attributable to its trade receivables. In order to mitigate this risk, the Group
has arranged credit insurance on certain of its trade receivables as deemed appropriate and as contractually
required. Where credit insurance is not considered cost effective, the Group monitors credit-worthiness
closely and mitigates risk, where appropriate, through payment plans.

The credit risk on cash balances is limited because the counterparties are banks with high credit-ratings
assigned by international credit-rating agencies.

16. Cash and Short Term Deposits

Cash and short term deposits comprise cash held by the Group and short term bank deposits.

17. Trade and Other Payables

Trade creditors
Finance leases
Other creditors
Other tax and social security payable

31 December
2011

31 December
2010

£’000

7,609
56
272
2,441

10,378

£’000

5,447
68
342
2,830

8,687

Trade and other creditors principally comprise amounts outstanding for trade purchases and on-going
costs. The Directors consider that the carrying amount of trade payables approximates their fair value.

The Mission Marketing Group plc Annual Report

18. Bank Overdrafts, Loans and Net Debt

Bank loan outstanding
Accumulated interest
Adjustment to amortised cost

Carrying value of loan outstanding
Less: Cash and short term deposits

Net bank debt

The borrowings are repayable as follows:
Less than one year
In one to two years
In more than two years but less than three years
In more than three years but less than four years

Accumulated interest
Adjustment to amortised cost

Less: Amount due for settlement within 12 months
(shown under current liabilities)

Amount due for settlement after 12 months

31 December
2011

31 December
2010

£’000

16,207
-
(566)

15,641
(315)

15,326

4,000
12,207
-
-

16,207

-
(566)

15,641

(4,000)

11,641

20,314
114
(525)

19,903
(1,438)

18,465

3,000
4,000
13,314
-

20,314

114
(525)

19,903

(3,000)

16,903

The adjustment to amortised cost relates to the amortisation of bank debt renegotiation fees over the life
of the loan facility.

At 31 December 2011, the Company had a three year revolving credit facility of up to £12.8m, due for
repayment by June 2013 on a quarterly basis, and a term loan facility of £3.0m with a bullet repayment
on 31 December 2013. Interest on the revolving credit facility is based on 3 month LIBOR plus 4.125%,
payable in cash on loan rollover dates. The interest margin of 7.5% on the term loan facility is added to
the loan balance on a quarterly basis and payable in full with the bullet repayment on 31 December 2013.
The gross amount of the term loan at 31 December 2011 was £3.4m. In addition to its committed facilities,
the Group had available an overdraft facility of up to £2.0m with interest payable by reference to National
Westminster Bank plc Base Rate plus 3.5%.

At 31 December 2011, there was a cross guarantee structure in place with the Group’s bankers by means
of a fixed and floating charge over all of the assets of the Group companies in favour of Royal Bank of
Scotland plc and HSBC Bank plc.

All borrowings are in sterling.

19. Obligations under Finance Leases

Obligations under finance leases are as follows:

In one year or less
Between two and five years

31 December
2011

31 December
2010

£’000

56
40

68
96

164

The Mission Marketing Group plc Annual Report

Assets held under finance leases consist of office equipment. The fair values of the Group’s lease obligations
approximate their carrying amount.

The Group’s obligations under finance leases are secured by the lessor’s charge over the leased assets.

20. Deferred Taxation

The deferred taxation liability of £1,000 (2010: £2,000) recognised in the financial statements is set out below:

Accelerated capital allowances
Other timing differences

The movement in the year is analysed as follows:

As at 1 January
Credit to profit or loss

As at 31 December

31 December
2011

31 December
2010

£’000

-
1

3
(1)

Year to
31 December
2011

Year to
31 December
2010

£’000

2
(1)

21
(19)

As shown in note 15, there is a deferred tax asset of £10,000 (2010: £62,000) relating to accounting
adjustments for IFRS.

21. Financial Commitments

Operating Lease Commitments

As at 31 December the Group had annual commitments under non-cancellable operating leases as follows:

Operating leases which expire:
Within one year
Between two and five years
After more than five years

31 December
2011

31 December
2010

Land and
buildings

Other

Land and
buildings

Other

£’000

178
326
444

948

13
468
-

481

7
622
355

984

6
449
-

455

The Mission Marketing Group plc Annual Report

22. Share Capital

Authorised:

85,000,000 ordinary shares of 10 p each (2010: 85,000,000
ordinary shares of 10p each)

Allotted and called up:

72,460,444 ordinary shares of 10 p each (2010: 72,460,444
ordinary shares of 10 p each)

Options

The Group has the following options in issue:

31 December
2011

31 December
2010

£’000

8,500

£’000

8,500

7,246

At start
of year

Granted

Waived/
lapsed

Exercised

At end
of year

SAYE Scheme

245,052

(245,052)

TMMG Long Term Incentive Plan

1,476,000

1,450,000

(143,750)

(31,250)

2,751,000

Bank warrants

2,333,434

The SAYE Scheme was available to all employees. The exercise price of share options outstanding under
this scheme was 81.0p, being 90 percent of the market price of the underlying shares at the time of issue.
The scheme matured during the year, when the market price of the underlying shares was below the
exercise price, and, accordingly, all SAYE Scheme options lapsed.

TMMG Long Term Incentive Plan (“LTIP”) was created to incentivise certain key employees. The vesting
criterion applicable to the options in issue at the start of the year, with a nil exercise price, is that they are
solely dependent upon the achievement of profit targets over the three year period ending 31 December
2012. Options issued during the year, also with a nil exercise price, may vest solely dependent upon the
achievement of profit targets over the three year period ending 31 December 2013. Shares held in an
Employee Benefit Trust (see note 23) will be used to satisfy share options exercised under The Mission
Marketing Group Long Term Incentive Plan.

Warrants over 3% of the Group’s share capital were issued to the Group’s loan providers following the
refinancing completed in 2010. These outstanding warrants have a 10.0p exercise price.

23. Own Shares

At 1 January 2010
Awarded to employees during the year

At 31 December 2010

Awarded to employees during the year

At 31 December 2011

No. of shares
1,698,094
(167,053)

1,531,041

(31,250)

1,499,791

£’000
1,398
(139)

1,259

(25)

1,234

Shares are held in an Employee Benefit Trust to meet certain requirements of The Mission Marketing Group
Long Term Incentive Plan.

The Mission Marketing Group plc Annual Report

24. Staff remuneration reserve account

The staff remuneration reserve account represents charges to the profit or loss required by IFRS 2 to reflect
the cost of the options issued to the Directors and employees.

25. Share-based payments

Options

Fair value on grant date is measured by use of a Black Scholes model. The valuation methodology is applied
at each year end and the valuation revised to take account of any changes in estimate of the likely number
of shares expected to vest. Details of the relevant option schemes are given in note 22. The key inputs are:

Share price
Risk free rate
Dividend yield

2011

18p
0.6%
0.0%

2010

10p
1.2%
0.0%

Volatility is based on the historical volatility of the share price over a 3 year trading period although, for
nil-cost options issued under the Group’s Long Term Incentive Scheme, volatility does not impact the
calculation of fair value. The weighted average share price over the three years ending 31 December 2011
was 14.0p.

The Group recognised an expense of £129,000 in 2011 (2010: £94,000).

26. Reconciliation of Operating Profit to Operating Cash Flow

Operating profit
Depreciation and amortisation charges
Loss/(gain) on disposal of property, plant and equipment
Non cash charge for share options and shares awarded
Decrease/(Increase) in receivables
(Increase)/decrease in stock and work in progress
(Decrease)/Increase in payables

Operating cash flow

Year to
31 December
2011

Year to
31 December
2010

£’000

5,748
762
16
129
1,401
(137)
(726)

7,193

£’000

3,763
725
(14)
94
(5,277)
36
6,111

5,438

The Mission Marketing Group plc Annual Report

27. Financial Assets and Liabilities

The Group’s financial instruments comprise cash and various forms of borrowings. As permitted by IAS 39,
short-term debtors and creditors have been excluded. It does not enter into derivatives transactions such
as interest rate swaps, forward rate agreements or forward currency contracts.

The Group’s activities take place in the United Kingdom and no material transactions take place with overseas
customers or suppliers in local currency. There was no material foreign currency exposure at the year end.

The main purpose of the Group’s use of financial instruments is for day-to-day working capital and as
part of the funding for past acquisitions. The Group financial policy and risk management objective is to
achieve the best interest rates available whilst maintaining flexibility and minimising risk. The main risks
arising from the Group’s use of financial instruments are interest rate risk and liquidity risk.

Interest Rate Risk

The operations of the Group generate cash and it funds acquisitions through a combination of retained
profits and borrowings. The Group’s financial liabilities comprise floating rate instruments. The bank loan’s
interest rate is reset from time to time and accordingly is not deemed a fixed rate financial liability.

Interest on the Group’s revolving credit facility is payable by reference to 3 month LIBOR plus 4.125%,
subject to a downward ratchet on achievement of certain ratios of debt to EBITDA on an annual basis.
Interest on the term loan is calculated by reference to 3 month LIBOR plus 7.5%. Whilst the Group previously
made use of interest rate caps and collars entered into in 2007 and early 2008, these hedging instruments
matured during 2011 and have not been replaced on the basis that they were not considered to be cost
effective. At 31 December 2011, no hedging instruments were outstanding.

Liquidity Risk

The Group’s financial instruments include a mixture of short and long-term borrowings. The Group seeks
to ensure sufficient liquidity is available to meet working capital needs and the repayment terms of the
Group’s financial instruments as they mature.

Financial assets

Cash at bank maturing in less than one year or on demand

Financial liabilities

Interest analysis:
Subject to floating rates
Subject to fixed rates

Maturity analysis:
One year or less, or on demand
After one year and within two years

£’000
Bank Loan and
Overdraft

£’000
Finance
Leases

16,207
-

16,207

4,000
12,207

16,207

-
96

56
40

31 December
2011
£’000

315

31 December
2011
£’000

Total

16,207
96

16,303

4,056
12,247

16,303

The Group’s bank loans and overdraft facility are floating rate borrowings and both facilities are secured
by a fixed and floating charge over the assets of all Group companies.

The fair value of the Group’s financial assets and liabilities is not considered to be materially different from
their book values.

The Mission Marketing Group plc Annual Report

28. Pensions

The Group operates ten defined contributions pension schemes. The pension cost charge for the year
represents contributions payable by the Group to the schemes and amounted to £753,000 (2010: £618,000).
At the end of the financial year outstanding contributions amounted to £56,000 (2010: £32,000).

29. Leave pay accrual

No liability or expense has been recognised relating to untaken leave for any of the periods presented.
The Group has a policy of not allowing days to be carried forward from one year to the next, unless in
exceptional circumstances. In addition, no payment is made in lieu of untaken leave which is not carried
forward. As a result, there is no material liability relating to untaken leave at year end.

30. Post balance sheet events

There are no material post balance sheet events.

31. Related party transactions

Parent company

Brian Child and Stephen Boyd receive their Non-Executive Director’s remuneration through Brain Child
Marketing Ltd and Stephen Boyd Ltd respectively, entities of which they are interested parties. In addition,
VPF London Ltd, an entity in which Peter Fitzwilliam is an interested party, received £161,000 for the
provision of CFO services.

Subsidiary undertakings

During the year, Bray Leino Ltd sold its printing division to Blue Sky Design & Print Limited, a company in
which Bray Leino Ltd purchased 50% of the equity. This company is treated as an associate in the financial
statements of The Mission Marketing Group plc. During the year Bray Leino sold printing machinery at
market value to the associate and purchased printing services to the value of £381,199. The results of
Blue Sky Design & Print Limited are not material to the consolidated financial statements of The Mission
Marketing Group plc.

Bray Leino Ltd is contracted to pay annual rent of £60,000 (2010: £60,000) to Mrs P H Morgan, the wife
of David Morgan (Chairman). Bray Leino Ltd is also contracted to rent premises from Hannele Limited,
in which David Morgan has a 100% beneficial interest, for an annual rent of £74,000 (2010: £74,000).
Additionally, during the year a consultancy fee of £nil was paid to Hannele Limited in relation to these
properties (2010: £30,000). At the end of the year £nil was owed to Hannele Limited (2010: £35,250).

During the year Bray Leino Ltd outsourced television productions to the value of £77,462 (2010: £187,666)
to Sticky Productions, a business in which Mrs E K Hutton, the wife of Bruce Hutton (Executive Director),
has a 100% beneficial interest.

ThinkBDW Ltd is contracted to pay annual rent to Mrs K Day and Mr A Day (wife and brother respectively
of Robert Day, Executive Director). The £35,000 annual rental payable (2010: £35,000) was set at market
value. At the end of the year there was no rent payable.

Dylan Bogg (Executive Director) resigned his directorship of Premier Veterinary Group Ltd on 14 June
2011, a company which is also a Client of Big Communications Ltd. Sales from Big Communications Ltd to
Premier Veterinary Group Ltd at arms length amounted to £10,934 (2010: £82,539). Included within trade
debtors is £4,586 (2010: £70,349) due from Premier Veterinary Group Ltd.

Big Communications Ltd paid rent during the year of £71,000 (2010: £71,000) to four individuals, including
Dylan Bogg and Chris Morris (Non-Executive Director). In addition, Morris Marketing Consultancy, a
consultancy practice owned by Chris Morris, invoiced Big Communications Ltd and was paid £44,183
(2010: £45,719) during the year for services rendered.

During the year Big Communications Ltd engaged Mrs K Bogg, the wife of Dylan Bogg, to undertake
marketing services activities for a total value of £22,500 (2010: £21,280). Big Communications Ltd also
engaged Mrs S Morris, the wife of Chris Morris, to undertake marketing research activities for a total value
of £5,100 (2010: £20,000).

The Mission Marketing Group plc Annual Report

32. Availability of Annual Report

Copies of the Annual Report for the year ended 31 December 2011 will be circulated to shareholders at
least 21 days ahead of the Annual General Meeting (“AGM”) on 18 June 2012 and, after approval at the
AGM, will be delivered to the Registrar of Companies. Further copies will be available from the Company’s
registered office and on the Group’s website, www.themission.co.uk

The Mission Marketing Group plc Annual Report

Independent Auditors’ Report to the Members of The Mission Marketing Group plc

We have audited the parent company financial statements of The Mission Marketing Group plc for the
year ended 31 December 2011 which comprise the Parent Company Balance Sheet and the related notes.
The financial reporting framework that has been applied in their preparation is applicable law and United
Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

Respective responsibilities of directors and auditor

As explained more fully in the Directors’ Responsibilities Statement set out on page 16 the directors are
responsible for the preparation of the parent company financial statements and for being satisfied that
they give a true and fair view. Our responsibility is to audit and express an opinion on the parent company
financial statements in accordance with applicable law and International Standards on Auditing (UK and
Ireland). Those standards require us to comply with the Auditing Practices Board’s (APB’s) Ethical Standards
for Auditors.

Scope of the audit of the financial statements

An audit involves obtaining evidence about the amounts and disclosures in the financial statements
sufficient to give reasonable assurance that the financial statements are free from material misstatement,
whether caused by fraud or error. This includes an assessment of: whether the accounting policies are
appropriate to the parent company’s circumstances and have been consistently applied and adequately
disclosed; the reasonableness of significant accounting estimates made by the directors; and the overall
presentation of the financial statements. If we become aware of any apparent material misstatements or
inconsistencies we consider the implications for our report.

Opinion on financial statements

In our opinion the parent company financial statements:

• give a true and fair view of the state of the Company’s affairs as at 31 December 2011;
• have been properly prepared in accordance with United Kingdom Generally Accepted
Accounting Practice; and
• have been prepared in accordance with the requirements of the Companies Act 2006.

Opinion on other matter prescribed by the Companies Act 2006

In our opinion the information given in the Directors’ Report for the financial year for which the financial
statements are prepared is consistent with the parent company financial statements.

Matters on which we are required to report by exception

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us
to report to you if, in our opinion:

• adequate accounting records have not been kept 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; or

• certain disclosures of directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.

Other matter

We have reported separately on the consolidated financial statements of The Mission Marketing Group plc
for the year ended 31 December 2011.

CHRISTOPHER HICKS BA FCA (Senior Statutory Auditor)
For and on behalf of Francis Clark LLP
Chartered Accountants and Statutory Auditors
Sigma House, Oak View Close
Edginswell, Torquay TQ2 7FF

27 March 2012

The Mission Marketing Group plc Annual Report

Company Balance Sheet
as at 31 December 2011

NON-CURRENT ASSETS
Intangible assets
Tangible assets
Investments

CURRENT ASSETS
Debtors
Cash at bank

CREDITORS: Amounts falling due within
one year

NET CURRENT LIABILITIES

As at
31 December
2011

As at
31 December
2010

Note

£’000

34
35
36

49
4
91,845

91,898

2,863
1

2,864

(11,623)

(8,759)

52
16
96,242

96,310

2,704
271

2,975

(8,886)

(5,911)

TOTAL ASSETS LESS CURRENT LIABILITIES

83,139

90,399

CREDITORS: Amounts falling due after more than one year

(11,641)

(16,903)

NET ASSETS

CAPITAL AND RESERVES
Called up share capital
Share premium account
Staff remuneration reserve
Profit and loss account

SHAREHOLDER’S FUNDS

71,498

73,496

7,246
39,542
263
24,447

71,498

7,246
39,542
134
26,574

73,496

41
41
42
42

The financial statements were approved and authorised for issue on 27 March 2012 by the Board of Directors.
They were signed on its behalf by:

Peter Fitzwilliam
Director

Company registration number: 05733632

The Mission Marketing Group plc Annual Report

Notes to the Company Balance Sheet

33. Principal Accounting Polices

The financial statements are prepared in accordance with applicable United Kingdom law and accounting
standards (United Kingdom Generally Accepted Accounting Practice). The principal accounting policies of
the Company are set out below. The policies have remained unchanged from the previous year.

Accounting Convention

The financial statements have been prepared under the historical cost convention.

Going Concern

The Group’s available banking facilities provide comfortable levels of headroom against the Group’s
projected cash flows and the Directors accordingly consider that it is appropriate to continue to adopt the
going concern basis in preparing these financial statements.

Deferred Taxation

Deferred taxation is recognised on all timing differences where the transactions or event that give the
Company an obligation to pay more tax in the future, or a right to pay less tax in the future, have occurred
by the balance sheet date. Deferred tax assets are recognised when it is more likely than not that they
will be recoverable. Deferred tax is measured using rates of tax that have been enacted or substantively
enacted by balance sheet date.

Property, Plant and Equipment

Depreciation is provided on all property, plant and equipment at rates calculated to write off the cost, less
estimated residual value based on prices prevailing at the date of acquisition, of each asset evenly over its
expected useful economic life, as follows:

Short leasehold property
Motor vehicles
Fixtures, fittings and office equipment
Computer equipment

Period of the lease
25% per annum
10-33% per annum
25-33% per annum

Deferred Consideration

The terms of an acquisition may provide that the value of the purchase consideration, which may be payable
in cash or shares at a future date, depends on uncertain future events such as the future performance
of the acquired company. The amounts recognised in the financial statements represent a reasonable
estimate at the balance sheet date of the amounts expected to be paid and has been classified in the
balance sheet in accordance with the substance of the transaction. Where the agreement gives rise to an
obligation that may be settled by the delivery of a variable number of shares to meet a defined monetary
liability, these amounts are disclosed as debt.

The Mission Marketing Group plc Annual Report

Investments

In the Company’s financial statements, investments in subsidiary undertakings are stated at cost less provision
for any impairment in value.

Lease Commitments

Rental costs under operating leases are charged against profits as incurred.

Profit of Parent Company

As permitted under Section 408 of the Companies Act 2006, the profit and loss account of the Company
is not presented as part of these accounts.

34. Intangible Assets

31 December
2011

31 December
2010

£’000

Intellectual property rights

Intangible assets consist of intellectual property rights which are amortised over 20 years. The amortisation
charge for the year was £3,000 (2010: 3,000).

35. Tangible Fixed Assets

Cost
At 1 January 2011
Additions
Disposals

At 31 December 2011

Depreciation
At 1 January 2011
Charge for the Year
Disposals

At 31 December 2011

Net book value at 31 December 2011

Net book value at 31 December 2010

Fixtures &
Fittings

Office
Equipment

£’000

Total

£’000

58
-
-

49
8
-

33
1
(1)

26
4
-

91
1
(1)

75
12
-

The Mission Marketing Group plc Annual Report

36. Investments

At 1 January 2011
Adjustments to consideration
Impairment

At 31 December 2011

Net book amount at 31 December 2011

Net book amount at 31 December 2010

Shares in
subsidiary
undertakings

£’000

96,242
46
(4,443)

91,845

96,242

The adjustments to consideration relate to changes in the deferred consideration of completed acquisitions.

The principal Group companies at 31 December 2011 are set out below. All subsidiaries are 100% owned
and all are incorporated in the United Kingdom.

Subsidiary Undertaking

Nature of Business

Big Communications Limited

Brand planning and strategic development

Fuse Digital Limited

Bray Leino Limited

ThinkBDW Limited

April-Six Limited

Story UK Limited

RLA Group Limited

Robson Brown Limited
(formerly Triang Marketing Limited)

37. Debtors

New media marketing, including website design and
advertising, SMS messaging, digital video and database
management

Advertising, events and PR

Property marketing, providing advertising, media, brochures,
signage, exhibitions, CGI, animation, intranet, photography

Integrated communications, specialising in the technology
sector

Brand development and creative direct communication

Marketing and communications

Amounts due from subsidiary undertakings
Prepayments
Other debtors

31 December
2011

31 December
2010

£’000

2,840
20
3

2,863

£’000

2,650
24
30

2,704

The Mission Marketing Group plc Annual Report

38. Creditors: Amounts Falling Due Within One Year

Bank overdraft
Amounts due to subsidiary undertakings
Social security and other taxes
Accruals
Bank loan (see note 40)
Other creditors

39. Creditors: Amounts Falling Due After More Than One Year

Bank loan (see note 40)

40. Borrowings

Bank loan outstanding
Accumulated interest
Adjustment to amortised cost
Carrying value of loan outstanding
The borrowings are repayable as follows:
Less than one year
In one to two years
In more than two years but less than three years

Accumulated interest
Adjustment to amortised cost

Less: Amount due for settlement within 12 months
(shown under current liabilities)

Amount due for settlement after 12 months

31 December 2011

31 December
2010

£’000

3,248
4,161
5
171
4,000
38

11,623

£’000

1,067
4,439
8
335
3,000
37

8,886

31 December
2011

31 December
2010

£’000

11,641

£’000

16,903

31 December
2011

31 December
2010

£’000

16,207
-
(566)
15,641

4,000
12,207
-

16,207

-
(566)
15,641

(4,000)

11,641

£’000

20,314
114
(525)
19,903

3,000
4,000
13,314

20,314

114
(525)
19,903

(3,000)

16,903

Details of the Company’s borrowing facilities and interest rates are set out in Note 18 and not therefore
repeated here. All borrowings are in sterling.

As at 31 December 2011, Net Assets of the Group were £57,916,000 (2010: £54,701,000), and net borrowings
under this Group arrangement amounted to £15,326,000 (2010: £18,465,000).

The Mission Marketing Group plc Annual Report

41. Share Capital and Share Premium

The movements on these items are disclosed within the consolidated statement of changes in equity within
the consolidated financial statements.

42. Statement of Movements on Reserves

At 1 January 2010
Credit for share option scheme
Shares issued from EBT scheme

Profit for the period

At 31 December 2010

Credit for share option scheme
Loss for the period

At 31 December 2011

Staff
remuneration
reserve

Profit
and loss
account

£’000

60
74
-

134

129
-

263

10,462
-
20

16,092

26,574

-
(2,127)

24,447

As permitted by Section 408 of the Companies Act 2006, the Company has not presented its own profit
and loss account. The loss for the financial year relating to the Company amounted to £2,127,000 (2010:
profit of £16,092,000).

43. Operating Lease Commitments

As at 31 December 2011 the Company had no commitments under operating leases (2010: nil).

44. Related party transactions

Details of related party transactions are disclosed in note 31 of the consolidated financial statements.

The Mission Marketing Group plc Annual Report

Notice of Annual General Meeting

NOTICE is hereby given that the Annual General Meeting of The Mission Marketing Group plc (the “Company”)
will be held at 12 noon on Monday 18 June 2012 at the offices of Lewis Silkin LLP, 5 Chancery Lane, Clifford’s
Inn, EC4A 1BL to transact the following business:

Ordinary Resolutions

1. To receive the financial statements and the report of the Directors and the auditors for the year

ended 31 December 2011.

2. To appoint Francis Clark LLP as auditors of the Company.

3. To authorise the Directors to fix the remuneration of Francis Clark LLP.

4. Special Business

To consider and, if thought fit, to pass the following resolutions, as to which resolution 4 shall be
proposed as an ordinary resolution and resolutions 5 and 6 shall be proposed as special resolutions:

4. THAT the Directors be and are hereby generally and unconditionally authorised pursuant to Section
551 of the Companies Act 2006 as amended (the “Act”) to exercise all the powers of the Company to
allot shares in the Company and to grant rights to subscribe for, or to convert any security into, shares
in the Company up to an aggregate nominal value of £2,391,194.60 being 33% of the issued share
capital of the Company, provided that this authority shall expire at the conclusion of the next Annual
General Meeting of the Company after the passing of this resolution, save that the Company shall
be entitled to make an offer or agreement before the expiry of such authority which would or might
require shares to be allotted or any such rights to be granted, after such expiry and the Directors shall
be entitled to allot shares or grant any such rights pursuant to any such offer or agreement as if this
authority had not expired and all unexercised authorities previously granted to the Directors to allot
shares or grant any such rights be and are hereby revoked provided that the resolution shall not affect
the right of the Directors to allot shares or grant any such rights in pursuance of any offer or agreement
entered into prior to the date of this resolution.

Special Resolutions

5. THAT (subject to the passing of the resolution numbered 4 above) the Directors be and are hereby
empowered pursuant to Section 570, Section 571 and Section 573 of the Act to allot equity securities
(as defined in Section 560 of the Act) for cash pursuant to the authority conferred by resolution 4
above as if Section 561 of the Act did not apply to any such allotment, provided that this power shall
be limited to:

i. the allotment of equity securities in connection with a rights issue, open offer or other offer of
securities in favour of the holders of ordinary shares on the register of members at such record
date(s) as the Directors may determine where the equity securities respectively attributable to the
interests of the ordinary shareholders are proportionate (as nearly as may be) to the respective
numbers of ordinary shares held by them on any such record date(s), subject to such exclusions
or other arrangements as the Directors may deem necessary or expedient to deal with treasury
shares, fractional entitlements or legal or practical problems arising under the laws of any overseas
territory or the requirements of any regulatory body or stock exchange or by virtue of shares being
represented by depositary receipts or any other matter whatever; and

ii. the allotment (other than pursuant to sub-paragraph (i) above) to any person or persons of equity
securities up to an aggregate nominal value of £724,604 being 10% of the issued share capital of
the Company.

The Mission Marketing Group plc Annual Report

This power shall expire upon the expiry of the general authority conferred by resolution 4 above, save
that the Company shall be entitled to make an offer or agreement before the expiry of such power
which would or might require equity securities to be allotted after such expiry and the Directors shall
be entitled to allot equity securities pursuant to any such offer or agreement as if the power conferred
hereby had not expired and all unexercised authorities previously granted to the Directors to allot
equity securities be and are hereby revoked provided that the resolution shall not affect the right of
the Directors to allot equity securities in pursuance of any offer or agreement entered into prior to the
date of this resolution.

6. THAT pursuant to section 701 of the Act and subject to, and in accordance with the Company’s Articles
of Association, the Company be generally and unconditionally authorised to make market purchases
(within the meaning of Section 693(4)of the Act) of ordinary shares of the Company provided that:

i. the maximum number of ordinary shares hereby authorised to be acquired is 10,869,067 being
15% of the issued share capital; and

ii. the minimum price which may be paid for an ordinary share is the nominal value of such share; and

iii. the maximum price which may be paid for an ordinary share is an amount equal to 105% of
the average of the middle market quotations for an ordinary share in the Company as derived from
The London Stock Exchange Daily Official List for the 5 business days immediately preceding the day
on which such ordinary share is contracted to be purchased; and

iv. the authority hereby conferred shall expire at the conclusion of the Annual General Meeting of the
Company held in 2013 or 18 months from the date of this resolution (whichever is earlier); and

v. the Company may make any purchase of its ordinary shares pursuant to a contract concluded before
the authority hereby conferred expires and which will or may be executed wholly or partly after the
expiry of such authority; and

vi. all ordinary shares purchased pursuant to the authority conferred by this resolution 6 shall be
cancelled immediately on completion of the purchase or held in treasury (provided that the
aggregate nominal value of shares held as treasury shares shall not at any time exceed 10 per cent
of the issued share capital of the Company at any time).

By Order of the Board
Peter Fitzwilliam
27 March 2012

The Mission Marketing Group plc Annual Report

Notes to the Notice of Annual General Meeting, including explanatory notes to the Form of Proxy.

1. A member entitled to attend and vote at the Annual General Meeting (“AGM”) may appoint one or more
proxies (who need not be a member of the Company) to attend, speak and vote on his or her behalf. To
appoint as your proxy a person other than the chairman of the meeting, insert their full name in the box.
If you sign and return this proxy form with no name inserted in the box, the chairman of the meeting
will be deemed to be your proxy. Where you appoint as your proxy someone other than the chairman,
you are responsible for ensuring that they attend the meeting and are aware of your voting intentions. If
you wish your proxy to make any commitments on your behalf, you will need to appoint someone other
the chairman, and give them relevant instructions directly. In order to be valid an appointment of proxy
must be completed, signed and returned in hard copy form by post, by courier or by hand to Neville
Registrars Limited, Neville House, 18 Laurel Lane, Halesowen, West Midlands B63 3DA.

2. A form of proxy is enclosed for use by shareholders and, if appropriate, must be deposited with Neville
Registrars Limited, Neville House, 18 Laurel Lane, Halesowen, West Midlands B63 3DA not less than
48 hours before the time of the AGM. Appointment of a proxy does not preclude a shareholder from
attending the AGM and voting in person.

3. Pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001, in order to be able to attend
and vote at the AGM or any adjourned meeting, (and also for the purpose of calculating how many
votes a person may cast) a person must have his/her name entered on the register of members of the
Company by 12 noon on 16 June 2012 (or 12 noon on the date 2 days before any adjourned meeting).
Changes to entries on the register of members after this time shall be disregarded in determining the
rights of any person to attend or vote at the meeting.

4. Shareholders should note that it is possible that, pursuant to requests made by shareholders of the
Company under section 527 of the Companies Act 2006, the Company may be required to publish
on a website a statement setting out any matter relating to: (i) the audit of the Company’s accounts
(including the auditor’s report and the conduct of the audit) that are to be laid before the AGM; or
(ii) any circumstance connected with an auditor of the Company ceasing to hold office since the
previous meeting at which annual accounts and reports were laid in accordance with section 437
of the Companies Act 2006. The Company may not require the shareholders requesting any such
website publication to pay its expenses in complying with sections 527 or 528 of the Companies Act
2006. Where the Company is required to place a statement on a website under section 527 of the
Companies Act 2006, it must forward the statement to the Company’s auditor not later than the time
when it makes the statement available on the website. The business which may be dealt with at the
AGM includes any statement that the Company has been required under section 527 of the Companies
Act 2006 to publish on a website.

5. A corporation which is a member can appoint one or more corporate representatives who may exercise,
on its behalf, all its powers as a member provided that no more than one corporate representative
exercises powers over the same share.

6. The issued share capital of the Company is 72,460,444 Ordinary shares of 10 pence each. The total

number of voting rights in the Company is 72,460,444.

The Mission Marketing Group plc Annual Report

7. You may appoint more than one proxy provided each proxy is appointed to exercise rights attached
to different shares. You may not appoint more than one proxy to exercise rights attached to any one
share. To appoint more than one proxy, the proxy form should be photocopied and the name of the
proxy to be appointed indicated on each proxy form together with the number of shares that such
proxy is appointed in respect of. All copies of the proxy form should then be sent to Neville Registrars
Limited at the address given above.

8. To direct your proxy how to vote on the resolutions, mark the appropriate box with an ‘X’. To abstain
from voting on a resolution, select the relevant “Withheld” box. A vote withheld is not a vote in law,
which means that the vote will not be counted in the calculation of votes for or against the resolution.
If no voting indication is given, your proxy will vote or abstain from voting at his or her discretion. Your
proxy will vote (or abstain from voting) as he or she thinks fit in relation to any other matter which is
put before the meeting.

9. In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, only
the appointment submitted by the most senior holder will be accepted. Seniority is determined by the
order in which the names of the joint holders appear in the Company’s register of members in respect
of the joint holding (the first-named being the more senior).

10. If you submit more than one valid proxy appointment, the appointment received last before the latest

time for receipt of proxies will take precedence.

The Mission Marketing Group plc Annual Report

Advisors

Company Registration Number:

05733632

Registered Office:

Nominated Advisor and Broker:

Auditors:

Solicitors:

Registrars:

Company Secretary:

Bankers:

2nd Floor
8/9 Carlisle Street
London
W1D 3BP

Seymour Pierce Limited
20 Old Bailey
London
EC4M 7EN

Francis Clark LLP
Sigma House
Oak View Close
Edginswell
Torquay
TQ2 7FF

Lewis Silkin LLP
5 Chancery Lane
Clifford’s Inn
London
EC4A 1BL

Currently:
Capita Registrars
The Registry
34 Beckenham Road
Beckenham
Kent
BR3 4TU

With effect from 20 April 2012:
Neville Registrars
Neville House
18 Laurel Lane
Halesowen
West Midlands
B63 3DA

Peter Fitzwilliam
The Mission Marketing Group plc
2nd Floor
8/9 Carlisle Street
London
W1D 3BP

Royal Bank of Scotland plc
Corporate Banking
9th Floor
280 Bishopsgate
London
EC2M 4RB

HSBC Bank plc
City of London Corporate Banking Centre
1st Floor
60 Queen Victoria Street
London
EC4N 4TR

The Mission Marketing Group plc Annual Report

Form of Proxy

The Mission Marketing Group plc (“the Company”)
Annual General Meeting

I/We
(BLOCK CAPITALS)

(full name)

of
being member/members in the Company, hereby appoint the Chairman of the Meeting or (see note 1)

(address)

as my/our proxy to vote for me/us on my/our behalf at the Annual General Meeting of the Company to
be held on 18 June 2012 and at any adjournment thereof.

For

Against

Vote
Withheld

My/our proxy is to vote on the resolutions as follows:

Ordinary Resolutions

1. To receive the financial statements and the reports of the Directors
and auditors for the year ended 31 December 2011.

2. To appoint Francis Clark LLP as auditors of the Company.

3. To authorise the Directors to fix the remuneration of
Francis Clark LLP.

4. To authorise the Directors to allot shares pursuant to Section 551
of the Companies Act 2006.

Special Resolutions

5. To disapply statutory pre-emption rights pursuant to Section 570,
Section 571 and Section 573 of the Companies Act 2006.

6. To renew the Company’s authority to make market purchases of

its own ordinary shares.

Dated this

Signature(s)

day of

2012

Please indicate how you wish your form of proxy to vote on the resolutions by inserting “X” in the
appropriate space. In the case of a corporation the form of proxy must either be under its common
seal (if any) or signed on its behalf by its duly authorised agent or officer.

The Mission Marketing Group plc Annual Report

Do not affix postage if posting in
Gt. Britain, Channel Islands or N. Ireland

Third fold and tuck in

BUSINESS REPLY SERVICE
Licence No. RSTY-SAKX-RZSL

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Neville Registrars Limited

Neville House

18 Laurel Lane

Halesowen

B63 3DA

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marketing group plc

2nd Floor, 8/9 Carlisle Street, London W1D 3BP
T: +44 (0)203 463 2099
www.themission.co.uk