Our finances

Despite a challenging economic environment, we reported a satisfactory outcome for the year with total income of £483million (2010: £515million) and total funds of £186million (2010: £182million).

The outcome for the year was better than we expected, however the outlook remains challenging and uncertain and we continue to take a conservative approach to the commitment of expenditure and overall management of reserves. This is reflected in our reserves and investment policies as referred to on pages 12 and 13.

During the year, we maintained our annual research activity at £332 million (2010: £334 million). This is the key element of financial planning and we remain well placed to continue to meet our research commitments going forward due to a funds position of £186 million (2010: £182 million) and cash and investments of £211 million (2010: £225 milllion) at year end.

Income Total income was down by 6% to £483 million (2010: £515 million). However, adjusting for two one-off income windfalls in 2009/10 underlying income was down 3%, holding up well in the current climate.

Income from fundraising was down by 3% to £433 million (2010: £446 million), again a good result. Two key factors influenced the income reduction. In the Race for Life series of events, participant numbers were 64,000 (9%) less than in 2009, and the average sponsorship received for offline donations was lower, reducing income by 12% to £58 million (2010: £66 million). Income in 2009/10 included our largest-ever legacy.

This was partially offset by increased income from direct giving of over £5 million to £100 million, with lapse rates remaining stable and average value of donations increasing. Also, our new fundraising event, a night-time walking marathon called Shine, raised £2 million and this event is being developed in 2011.

Retail income held up well, with income of £65 million from donated stock and bought-in goods almost unchanged from 2009/10.

Fundraising income down to £433 million

3% (2010: £446 million)

Total income down to £483 million

6% (2010: £515 million) 10 / Annual Report and Accounts / Our finances

Costs of generating funds The costs of generating funds increased to £151 million (2010: £143 million). This reflects the increasing challenge to raise funds in the current giving market. Unlike 2009/10, we did not benefit from any unanticipated ‘windfalls’ in 2010/11. Our investment in fundraising is essential to sustaining income to fund long-term research. We remain focused on driving efficiencies and optimising costs.

Despite reduced income, increased costs and technology investment, 80% of every £1 donated was available to beat cancer (2010: 83%). During the year we reviewed the basis of calculation to reflect each £1 donated as opposed to each £1 received, as this is considered to be a more appropriate measure.

Costs of charitable activities

Our research is carried out in many institutes, universities and hospitals across the UK, both by our employees and by our grant-funded researchers – in many cases working closely together.

Research costs and howwe report grants Many of our programme grants are awarded for up to five years and may be renewed to support the next stage in the research process. Clinical trials can take several years to complete and may require many years of follow-up. In all areas we carry out the same rigorous process of evaluating, reviewing and ensuring the highest standard of research in allocating our funds. Committees of international experts in each research field review funding applications, including renewal of existing awards, and monitor the quality of research programmes.

Cost of charitable 6%

activities up to £340 million (2010: £322 million)