Notes to the Financial Statements

Cash Flow StatementsFor the Year Ended 31 December 200620Cash flows from operating activitiesGroupCompany2006 2005 2006 2005*Notes $’000 $’000 $’000 $’000Profit/(loss) before taxation 3,933 1,671 (904) (1,379)Adjustments for:Depreciation of property, plant and equipment 600 338 1 –Share options expense 45 – 45 –Interest income (87) – (648) –Interest expense 43 195 10 –Profit and loss before working capital changes 4,534 2,204 (1,496) (1,379)Decrease/(increase) in trade and other receivables 2,352 (2,175) (5,777) (3,552)Increase in inventories (1,252) (306) – –(Decrease)/increase in trade and other payables (208) 986 (93) 466(Decrease)/increase in taxes payable (272) 303 26 5Increase in advances to suppliers (2,638) – (2,638) –Cash generated from operations 2,516 1,012 (9,978) (4,460)Taxes paid (1,100) (724) – –Net cash from operating activities 1,416 288 (9,978) (4,460)Cash flows from investing activities:Interest received 23 – 421 –Purchase of property, plant and equipment 9 (2,023) (4,050) (3) –Issue of debt securities 1,103 – – –Repayment of debt securities (1,103) – – –Loans granted – (78) – –Loans repaid – 78 – –Purchase of financial assets 12 – (1,855) – –Sale of financial assets 12 – 1,987 – –Net cash used in investing activities (2,000) (3,918) 418 –Cash flows from financing activities:Cash inflow from issue of ordinary shares 5,317 8,541 5,317 8,541Exceptional share issue costs (356) (797) (356) (797)Proceeds from borrowings – 8,311 – –Repayment of borrowings (2,445) (6,692) – –Interest paid (200) (257) – –Net cash used in financing activities 2,316 9,106 4,961 7,744Effects of exchange rate changes 1,570 (49) 1,521 36Net increase/(decrease) in cashand cash equivalents 3,302 5,425 (3,078) 3,320Cash and cash equivalents atbeginning of the period 6,146 721 3,320 –Cash and cash equivalents at end of the period 13 9,448 6,146 242 3,320* 2005 for the Company represents the period from incorporation to 31 December 2005.The accompanying notes on pages 22 to 47 are an integral part of these financial statements.ZiRAX Annual Report & Accounts 2006