Chief Executive’s review continued
We take care 
of the things 
our customers 
don’t want to 
worry about.
As well as the
things they do.
MITIE Group PLC Annual Report 2005 MITIE is 
different because 
our people are...
...motivated, knowledgeable, passionate about 
their customers, properly equipped, rewarded 
and respected. We care about their health and 
safety, we train and develop them and provide 
opportunities for their growth.
Creating a flexible
partnership with
our customers…
means they get 
the services they
really need.
Catering
Hospitality &
Executive Dining
Staff Feeding
Consultancy
Cleaning
Offices
Windows
Industrial
Buildings
Recycling & Waste
Management
Retail Premises
Transport
Facilities
Food Hygiene
Healthcare
Facilities
Computers
Business
Services
Mailroom
Management
Reception &
Switchboard
Records
Management
Reprographics
Print
Management
Creative Services
Distribution
Management
Enginee
Mainte
Estate
Mainten
Heating
Ventilat
Conditi
Mainten
Mechan
Electrica
Boiler
Mainten
Lighting
Plumbin
Water H
Our values
Our services MITIE Services and Values
…so our 
customers
receive...
...loyalty, added value, the ability to focus on 
their core business, flexibility, quality services, 
responsiveness and choice. We listen to their 
needs, communicate effectively and work 
in partnership to provide multiple services.
...which means
that our 
shareholders 
and the 
community
achieve...
...sustainable performance, long-term 
commitment and corporate responsibility. 
MITIE is an entrepreneurial company with 
good governance, strong management, 
financial stability and a clear strategy.
ering
nance
nance
g 
tion & Air
ioning
nance
nical &
al Systems
nance
g
ng &
Hygiene
Engineering
Services
Mechanical &
Electrical
Mission Critical
Environments
Lifecycle
Solutions
Information
Communication
Technology
Air Conditioning
Process
Utilities
Infrastructure
Retail Engineering
Social Housing
Installations
Laboratories
Landscape
Grounds
Maintenance
Interior Tropical
Plants
Exterior
Landscape
Design &
Installation
Golf Course
Maintenance
Sports Ground &
Leisure Facilities
Maintenance
Arboricultural
Works
Managed
Services
Facilities
Management
Building & Estate
Management
Consultancy
Integrated Service
Delivery
Procurement 
& Supplier
Evaluation
PFI Service
Delivery
Pest Control
Service Contracts
Reactive Services
Insect Control
Hygiene Services
Bird Control
Wildlife
Management
Property
Services
Refurbishment
Interior Fit-out
Painting
Repair &
Maintenance
Roofing
Plastering
Partitioning
Industrial
Flooring
Fire Protection
Social Housing
Security
Static Guarding
Electronic
Mobile Guarding
Gallery
Attendants
Front of House
Warden Services
Key Holding
Consultancy
Remote
Monitoring MITIE was
founded in 
1987 with 
one philosophy
in mind.
Success would
come from 
creating the 
conditions to
motivate others:
employees, 
customers and
stakeholders. 
In 2005 this 
still holds true.
01 Financial Highlights
02 Chairman’s Statement
04 Chief Executive’s Review
08 Support Services
12 Building  Services
16 Finance Director’s Review
20 Corporate Responsibility
23 Board of Directors
24 Directors’ Report
26 Directors’ Remuneration Report
30 Corporate Governance
35 Independent Auditors’ Report
36 Group Profit and Loss Account
37 Reconciliation of Movements 
in Shareholders’ Funds
37 Note of Historical Cost Profits 
and Losses
38 Group Balance Sheet
39 Company Balance Sheet
40 Group Cash Flow Statement
41 Accounting Policies
43 Notes to the Accounts
59 International Financial 
Reporting Standards
61 Five-year Summary
62 Notice of Meeting
64 Shareholder Information
Contents ■ Strong financial performance
■ Opportunities for growth
■ 36% increase in dividend
■ Exit from capital intensive 
businesses is complete
■ Share buyback programme
Financial Highlights
MITIE Group PLC Annual Report 2005 01
MITIE has 
produced
another good
set of results.
The prospects
for the future 
are exciting.
* See Group Profit and Loss Account for reconciliation to
statutory numbers.  
** See Note 7 for reconciliation of basic earnings per share. 
Turnover £m 
2005
2004
£818.6m
£694.5m
+17.9%
Profit before tax – pre-goodwill* £m 
2005
2004
£38.8m
£40.3m
-3.9%
Basic earnings per share – pre-goodwill** pence 
2005
2004
6.9p
8.3p
-16.8%
Basic earnings per share pence 
2005
2004
6.0p
7.6p
-20.8%
Dividend per share pence 
2005
2004
3.4p
2.5p
+36.0%
Profit before tax £m 
2005
2004
£35.9m
£38.2m
-5.9%
Profit before tax – pre-goodwill and
exceptional items* £m 
2005
2004
£46.9m
£40.3m
+16.3%
Basic earnings per share – pre-goodwill and
exceptional items** pence 
2005
2004
9.6p
8.3p
+15.0% 02 MITIE Group PLC Annual Report 2005
MITIE has 
an exciting
future…
because our people
are committed to
delivering services
with passion.
David C Ord, Chairman
MITIE has an 18-year track record of 
continual growth. The Company is in 
an excellent financial position and is 
well positioned for further success.  Corporate Governance
We endeavour to achieve the highest standards of
Corporate Governance in the furtherance of our
business and achievement of corporate objectives,
which is clearly detailed in the Annual Report. 
Our difference
W e provide a range of skilled and semi-skilled services
to a wide variety of customers in both the private and
public sectors. Our people are focused on working
hard together, supporting our customers, listening to
them and making sure that the services we provide
connect with their needs.
I would like to thank all of our employees for 
their hard work and dedication over the year.
Without their efforts we would not be able to satisfy
our customers and produce results like these. 
Every one of our 30,000 employees has made an
important contribution.
The Executive Directors have experienced a year of
change; they have successfully integrated the newly
acquired companies and have discharged their
responsibilities admirably. 
I would also like to thank my fellow Non-Executive
Directors for the contribution they have made this
year. The Non-Executive Directors are faced with
increased responsibility and the Company is fortu-
nate to have Directors of such calibre and experience.
Success is never easy, but MITIE has been able to
achieve consistently high levels of performance
because our people are passionate about the quality
of service we provide and because of their finan-
cial interest in the result. That motivation makes 
the difference.
Outlook
We have a clear strategy. We will continue to look
for opportunities where it is viable to start new 
companies. We will continue to grow organically
within our chosen markets and look to expand 
our range of services within our skill base. We will
look for opportunities to make bolt-on acquisitions 
provided our criteria are met.
MITIE operates in a market that, although it is 
competitive, has plenty of opportunities for growth.
We are in the business of continuing to grow in
order to provide better services for our customers,
more opportunities for our employees and improving
returns for our shareholders. 
This Company is well positioned for further success.
I am excited about our prospects for the future.
David C Ord Chairman
I am pleased that I am able to report that we have
produced another good set of results for this financial
year, achieving growth in all of our businesses.
I believe that as Chairman my role is to maintain the
environment for the executive team to manage the
Company successfully and to motivate our employees
so that we can maintain our unequalled record of
providing excellent services to our customers and
achieving consistent growth. These results clearly
demonstrate that we have succeeded again.
I am determined that we will maintain our excellent
performance. 
“Success is never easy, but MITIE has
been able to achieve consistently
high levels of performance because
our people are passionate about the
quality of service we provide and
because of their financial interest 
in the result. That motivation makes
the difference.”
Results
Turnover rose to £818.6 million, an increase of 
17.9 % and profit before tax, goodwill amortisation
and impairment and exceptional items* rose by
16.3% to £46.9 million. Profit before tax after 
goodwill (£2.8 million, 2004: £2.2 million) and
exceptional items (£8.2 million, 2004: £nil) fell by
5.9% to £35.9 million.
Basic earnings per share before goodwill and excep-
tional items rose by 15.0% to 9.6p. Basic earnings per
share fell by 20.8% from 7.6p to 6.0p. The impact of
the exceptional items was to reduce earnings per
share by 2.7p in the current year.
*See Group Profit and Loss Account.
Dividend
The Board is recommending a final dividend of 1.8p
per share making a total of 3.4p for the year, an
increase of 36.0%. As stated in previous reports we
will continue to review our dividend policy.
Share buyback programme
We commenced a share buyback programme in
June 2004 and in the period under review pur-
chased 10,310,006 MITIE Group PLC ordinary
shares of 2.5p at an average price of 144.6p. The
highest and lowest prices paid were 165.0p and
131.0p respectively. All shares purchased have been
cancelled. We will be seeking to renew the authority,
granted by Shareholders, to purchase up to 10% of
the issued share capital of the Company at the
Annual General Meeting (‘AGM’) on 28 July 2005.
Chairman’s Statement
MITIE Group PLC Annual Report 2005 03 04 MITIE Group PLC Annual Report 2005
By working 
together with 
our customers…
we allow them 
to focus on their
core business.
Ian R Stewart, Chief Executive
This review of our operations has been 
prepared to enable our Shareholders 
and others to have a balanced and 
comprehensive understanding of our 
business and our performance for the 
year under review.
The review provides a wide range of information. For ease of 
reference, we have included the following list of contents 
within this section.
Overview
The business, its markets, values and strategy
The MITIE start-up model
Our major markets
Our structure and services
Our values
Our strategy
Operating Review
Performance in the period
Support Services
Building Services
Dynamics of the business
Cash
Future prospects The business, its markets, values and strategy
The MITIE start-up model
MITIE is now 18 years old and has started over 80
companies in accordance with the MITIE model.
However, we still receive many requests to explain
how the model works. 
In principle the model has not changed since we
started, although there have been several refine-
ments. The process normally develops as follows:
1. We will identify a team that wants the opport-
unity to run their own business.
2. Provided that their business idea fits with our
strategy and does not conflict with any of our
existing businesses, we interview the team. If we
like the team they prepare a business plan which
then follows an approval process and is signed
off by the Board.
3. The business plan determines the capital require-
ment. MITIE invests at least 51% of the initial
capital required and the management team
invests the balance. 
4. A limited company is established, placed in the
structure depending on the business activity
being pursued, sponsored by a PLC Director 
and supported by the Head Office team.
5. The team grow their business over the next five
to ten years.
6. Between the fifth year and the tenth year the
minority shareholders have an opportunity to
serve a transfer notice on MITIE Group PLC to
earn out their minority interest, which MITIE
Group PLC may or may not accept. This must be
done within seven to 14 days after our AGM.
7. In order to calculate the value of the minority
stake in the business we use a multiple of ten
times post-tax profits averaged over the previous
two years, or three years depending on the type of
business. The consideration is paid in either cash
or MITIE Group PLC shares at the Board’s option.
8. If the consideration is paid in MITIE Group PLC
shares they cannot be traded for two years post
the earn-out, but the owners are entitled to
receive dividends.
9. The management team stays in place after the
earn-out and continue to grow the business and
progress their career within MITIE.
The model continues to attract entrepreneurial
managers who want to run their own business
in MITIE.
Overview
MITIE has had a good year and I am pleased with
the progress that we have made. 
“As MITIE grows we need to provide
our businesses with an increasingly
robust support team. During the 
year we have reinforced the central
team by recruiting a number of 
additional specialists.”
1. Our forward order book has increased with 70%
of budgeted revenue secured for the financial
year 2005/2006.
2. We have experienced good levels of contract
renewals across all businesses.
3. Cleaning has been successfully restructured.
4. The recent acquisitions have been successfully
integrated and their financial contribution is 
better than we expected.
5. In the final step of the strategy to exit capital-
intensive activities we sold our entire sharehold-
ing in MITIE Generation Ltd (‘Generation’) to a
management buyout team on 30 September 2004.
6. During the year we have built a corporate 
development team focused on acquisitions.
7. We have moved our head office to a more 
modern building at Emersons Green, north of
Bristol, just four miles from Bristol Parkway 
station. As MITIE grows we need to provide our
businesses with an increasingly robust support
team. During the year we have reinforced 
the central team by recruiting a number of 
additional specialists.
8. We have set up a new department of Corporate
Responsibility. 
Chief Executive’s Review
MITIE Group PLC Annual Report 2005 05 Our values
Since MITIE started there has been a set of values
that has enabled our entrepreneurial and motivated
managers to grow the business successfully. They
have been centred on the three core principles of
Focus, Connect and Achieve: 
■ Focus on our goals and those of our customers;
■ Connect with our customers at all levels to 
fulfil their needs; and
■ Achieve success by consistently delivering 
a quality service.
The application of these values has enabled the
business to grow consistently. Over the years we
have developed the values so that our employees
understand them clearly and are able to apply them
to their daily work. 
Our strategy
Our strategy remains:
1. Grow our existing businesses organically and
increase the amount of bundled services that 
we provide;
2. Start new companies in accordance with the
equity model;
3. Make acquisitions in our markets when suitable
companies are identified;
4. Invest in market sectors, such as education and
social housing, where those markets offer good
potential; and
5. Expand our core skills competency so that we
are able to offer additional services.
Helping make a great first impression in reception
MITIE Group PLC Annual Report 2005
Our major markets
MITIE operates across the UK and has customers in
all major market sectors. Currently 40% of our work
comes from the public sector and 60% from the 
private sector. We believe that this mix of business is
healthy for the Company and enhances the long-
term sustainability of our revenue stream. We have
a relatively low market share in all of these sectors,
giving us plenty of opportunity for future growth.
Our structure and services
MITIE’s operating businesses are structured in two
divisions; Support Services and Building Services.
The divisions are supported by a Head Office team,
which provides policies, advice and assistance 
for Health & Safety, Human Resources, IT, Sales 
& Marketing, Risk Management, Finance, Legal,
Insurance and Property matters.
Support Services offers a flexible range of services
supporting the occupiers of buildings. These are
shown on the inside front cover of this report and
range from Engineering Maintenance and Facilities
Management to Security. We listen to our cust-
omers and create solutions that meet their needs
and resources.
Building Services is involved in the construction,
refurbishment and repair of buildings. Engineering
is predominantly a mechanical and electrical services
specialist installing heating, lighting, air condit-
ioning and data cabling. Property Services act as 
a main contractor improving buildings either by 
fitting them out, refurbishing or maintaining them.
06
Percentage of Group Turnover by Sector
Private Sector
      Transport 2%
      Commercial 21%
      Finance & Professional 9%
      Leisure & Entertainment 4%
      Manufacturing 13%
      Retail 7%
      Science & Technology 4%
Public Sector
      Defence 3%
      Education 8%
      Government 9%
      Healthcare 5%
      Local authority 5%
      Social housing 7%
      Utilities 3%
 
       MITIE has significantly developed its relationship
with property outsourcing specialists Land Securities
Trillium (LST), part of Land Securities Group plc over
the past five years. The facilities services contract for
the Department for Work and Pensions (DWP) port-
folio, across Northern England and Scotland, has
been enlarged and now extends to 2018. We have
completed four Job Centre Plus refurbishments for
the DWP and provide a national painting and air
conditioning service as well.
We are working with LST to provide facilities man-
agement to their fully serviced Landflex buildings in
London. We deliver services including Reception,
Maintenance, Cleaning, Security, Landscaping, Post-
room and Courier Management as well as Disaster
Recovery and Contingency Planning. 
“We are working with LST to provide 
facilities management to their fully 
serviced Landflex buildings in London.”
Service Facilities Management
Sector Commercial
Client Land Securities
Flexible facilities services at Landflex
MITIE provides a call centre, planned and reactive
service management as well as on-site consultancy
on best practice and legislation.
In addition, this has provided fit-out opportunities
in London where we have recently completed the
new media village at the BBC as a follow on from
last year’s ‘superstars’ changing rooms project. This
in turn has led to two sizeable refurbishment proj-
ects in Paddington.
The element of trust and reliability nurtured at 
this stage of the relationship encouraged LST to
select MITIE as a long-term preferred supplier when
additional services are required.
Chief Executive’s Review continued
MITIE Group PLC Annual Report 2005 07 Operating Review
Performance in the period
I am pleased with our performance this year. 
We have made good progress.
Support Services
Cleaning 
On 1 November 2004 we received shareholder
approval for our second-generation equity plan for
the Cleaning business. We have a young manage-
ment team within Cleaning, who had previously
not had the opportunity to subscribe for equity.
They have invested £600,000 in the new equity of
MITIE Cleaning Services Limited. This is a signifi-
cant development of the MITIE equity model and
will allow the management to share in the additional
value they create.
This restructuring of the Cleaning business has 
been successful and the new management team is
operating the business on a national basis. The sales
and marketing team has been reinforced with the
appointment of a Sales and Marketing Director 
and a National Accounts Director. The specialist
businesses that focus on individual market sectors
have had a particularly good year gaining signifi-
cant market share. 
During the year we have secured many notable con-
tract wins including the new Doncaster Airport, 
BT Payphones, timetable installation for London
Buses, multi-site Co-op retail outlets, Goodrich
Engine Control Systems, Barclays Capital, Nokia UK
in a bundled service contract with Engineering
Maintenance, West Yorkshire Police and Pfizer UK.
We started the contract for the Scottish Parliament
that was awarded to us in the last financial year but
had a delayed start.
Cleaning has conducted extensive customer
research with the main conclusion that customer
satisfaction is directly linked to staff retention. To
enhance levels of staff retention Cleaning has
launched a major recognition and reward initiative
for staff that make an outstanding contribution for
clients and fellow MITIE colleagues. 
Mike McCarthy decided to retire this year; Mike was
responsible for our northern Cleaning business. 
I would like to thank him for the important contri-
bution he has made to MITIE over the years.
Catering
Catering continues to develop. A new business 
commenced trading in London that has started
well. Catering has secured contracts with IMS
Healthcare, Osborne Clarke, GVA Grimley and 
the National Audit Office. Catering achieved accred-
itation to the Hospitality Assured standard in
October 2004. Hospitality Assured is the world-class
standard for service and business excellence in the
UK hospitality industry.
Since the year-end we have recruited a dynamic team
to set up MITIE Catering in the north of England.
The Catering business will grow through develop-
ing a food service that delivers high levels of 
customer satisfaction, patronage and daily spend.
This will keep client subsidies at a competitive 
level which, allied to client relationships, will 
generate high levels of contract retention. The inter-
nal operating brand ‘ingredients’ will continue 
to be developed, acting as a clear differentiator 
in the market. Catering will continue to invest in 
the food concept function dedicated to driving 
up operating standards in vendor management, 
commodity selection, kitchen process and food
offer ranges.
Landscape
Landscape has made further progress during the
year. It has secured a national contract with Lloyds
TSB to maintain grounds and external areas and
with Proctor and Gamble in Egham. Landscape has
also started to penetrate the public sector and has
added a contract with Yorkshire Metropolitan
Housing Group to our existing Local Authority and
Police contracts.
Catering: cooking with the best ingredients
08 MITIE Group PLC Annual Report 2005 Service Facilities Management
Sector Government
Client Office of the Deputy Prime Minister
Reception at Eland House, ODPM
During the year under review MITIE started the 
contract to provide a full facilities management
service to the main office buildings of the Office 
of the Deputy Prime Minister (ODPM) in London.
The contract, awarded for an initial term of five
years, was mobilised on 1 April 2004, with full 
operations commencing on 1 July 2004. 
The main buildings covered by the contract, Eland
House and Ashdown House in Victoria, and
Riverwalk House on Millbank, are serviced by 
a team of over 180 MITIE people in support of 
the 3,000 ODPM staff. Services provided by 
MITIE include Facilities Management, Building
Services, Grounds Maintenance, Pest Control,
Waste Management, Catering, Security, Cleaning,
Mail Services, Reprographics, Safety, Health &
Environmental Management, Reception, Confer-
ences and Space Management.
“By continually improving quality and
value through innovation, collaboration
and consultation, the ODPM contract is
going from strength to strength.”
The ODPM contract has given MITIE the opport-
unity to deliver a comprehensive range of services
using the specialist knowledge of our teams. It is this 
flexibility that makes MITIE so unique and helps us 
provide truly integrated services.
Intense, regular and open communication was key
to the successful mobilisation of this contract.
Alongside continual daily communication, MITIE
personnel attend weekly team meetings, monthly
liaison meetings and quarterly joint Board meetings
to ensure that all levels of both MITIE and ODPM
staff are kept informed of contract developments.
MITIE’s partnership ethos with its customers has also
ensured the transference of best practice from other
parts of MITIE and the wider industry into this con-
tract. Moreover by continually improving quality
and value through innovation, collaboration and
consultation the ODPM contract is going from
strength to strength.
Chief Executive’s Review continued
MITIE Group PLC Annual Report 2005 09 Pest Control
Pest Control has had a year of consolidation follow-
ing its acquisition in the last financial year and 
has now integrated well into MITIE. They have 
been awarded a five-year contract with Compass. 
They have also been awarded work with Safestore
and Thameslink. 
Pest Control has invested in its sales force to achieve
its organic growth targets and will concentrate on
multi-site retail outlets and railway-related services,
in addition to its core market of smaller businesses
and local markets. It will continue to focus on main-
taining its high levels of customer retention. 
The company is now the third largest pest control
business in the UK.
Security
Security is performing well, having successfully inte-
grated the acquisitions from the previous year.
Notable contract wins include CIS and Re: Sources
UK (Publicis). MITIE Security (South West) started
trading in September 2004 and on 4 May 2005 we
announced the acquisition of Intruder International
Ltd (‘Intruder’), which is at the forefront of develop-
ing integrated networked security solutions. 
MITIE Security forges long-lasting relationships by
understanding and supporting its clients and its
people. It achieves this by delivering on its promises
of a timely and properly structured security solution
that clearly meets the requirements of its clients.
The business is primarily a single service provider
focused on the manned guarding sector. Its strategy
is to move the business to a broader-based security
service combining the use of manpower and 
electronic security.
The business has a series of objectives:
1. Complete the national footprint for manned
guarding;
2. Achieve an improved geographical balance; and
3. Enhance its electronic security capability based
on integrated solutions that utilise clients’ 
existing network infrastructure.
Licensing for security officers becomes mandatory
in March 2006. We have invested in ten trainers
who are qualified to deliver the required Level 1 & 2
training programme and currently have 30% of our
officer base that have completed the requisite certi-
fied training. By early September 2005 we anticipate
60% of our officer base will be certified and full
compliance is targeted by the deadline date. We feel
that our commitment and investment in our officer
base will fully meet the requirements for licensing
set by the Security Industry Authority and we are
confident that we will exceed the criteria set for the
proposed new Approved Contractor Scheme
(‘ACS’).
The impact of licensing we believe will stimulate
further consolidation in the security marketplace as
smaller providers struggle to meet the requirements
of both the licensing regime and the standards set
for ACS status. The short-term impact, as the dead-
line of March 2006 approaches, could be instability
of a short-term nature in the labour supply market.
However, in the medium to long-term, standards
will rise, margins should improve and a licensed
officer will become more highly valued by both 
customer and employer.
Managed Services
Managed Services has made good progress this year,
focusing on customer satisfaction and retention,
which has resulted in the expansion of many 
existing relationships including our work with Land
Securities on their Landflex sites in London and
with ShopDirect in Manchester. Managed Services
was awarded contracts with Transport for London,
3Com and Crown Castle during the past year. Since
the year-end we have regained and expanded 
our framework contract with RWE NPower for an
additional five years. This success has been achieved
by closely monitoring customer needs, conducting
extensive customer surveys, closely monitoring per-
formance and improving service levels.
Managed Services has continued to improve its 
support functions for human resources, sales and
marketing, health and safety, energy management
and commercial management. We pay particular
attention to the development of our employees to
ensure that we have the appropriate skills as the
business grows.
Security: patrolling the Victoria Shopping Quarter in Leeds
10 MITIE Group PLC Annual Report 2005 Service Engineering
Sector Education
Client Kingsmead Primary School
Enjoying school at eco-friendly Kingsmead
Creating a building able to conserve resources 
and positively affect the surrounding environment
has become something of a ‘holy grail’ within the
construction industry. MITIE’s involvement in
state-of-the-art eco-friendly school, Kingsmead
Primary, in Cheshire, has demonstrated the way
that concepts of sustainable construction can
become a reality. 
Earmarked by the Department for Education and
Skills (DfES) as an ‘exemplar model of excellence’ 
and selected as a Constructing Excellence demon-
stration project, the school, incorporates numerous
innovative features including: a biomass boiler burn-
ing reclaimed wood pellets to provide heating, a rain-
water recycling system that provides water to flush
toilets as well as solar panels and photovoltaic cells to
“A particular emphasis has been placed
on making this building a learning 
tool for its pupils.”
generate energy. A particular emphasis has been
placed on making this building a learning tool for its
pupils, ensuring that they get a first-hand under-
standing of the way their school operates, saves 
energy and works with its environment.
Understanding the wider picture of sustainability,
MITIE sourced products from local suppliers and
researched project grants available for the project,
via schemes such as Clear Skies, for key elements
throughout the build process. MITIE was able 
to support and adapt the services for maxi-
mum long-term efficiency and ensure that the 
innovative services could be integrated to provide a
functioning, comfortable environment. The result is
a school that demonstrates the wholly viable reality
of sustainable construction in the public sector.
Chief Executive’s Review continued
MITIE Group PLC Annual Report 2005 11 PFI
Our PFI company, which specialises in providing
facilities management to PFI school projects, where
we take no equity, continues to develop. We now
have 15 signed contracts in respect of 33 schools
and are preferred bidder on five further contracts.
Business Services
Business Services had another good year adding 
further blue-chip customers to their impressive list
of leading corporations, financial institutions and
professional firms, with contract wins at Morgan
Stanley and Société Générale. The business also
renewed contracts in the last year at the London
offices of the international law firms of White &
Case, Skadden Arps and Sullivan & Cromwell as
well as the London Stock Exchange.
A growing part of the business is document solu-
tions, involving the entire lifecycle of the document
from creation, to print, through to distribution. 
Future growth will come from:
1. Developing existing relationships with key
clients to expand the range of services;
2. Investment in business development and
obtaining new clients; and
3. Expanding the range of services to include 
creative services, print management and 
distribution.
Engineering Maintenance
Engineering Maintenance had another successful
year. The business is well positioned with one 
cohesive management structure and a central team
supporting the regional operating companies. 
A national sales and service delivery team has been
created to provide national customers with a consis-
tent quality service. Engineering Maintenance has
acted as the springboard for other MITIE services to
create bundled opportunities. An increased number
of customers are recognising the benefits that MITIE
can bring as a co-ordinated Group in bundled 
services contracts.
Engineering Maintenance has been awarded a num-
ber of notable contracts including Standard Life, the
University of Bath, Apsley House, Ayrshire and
Highland Councils. Bundled service contract wins
included the Department for Education and Skills at
their five main sites and Telecom Service Centres.
Crucial to the future development of Engineering
Maintenance is a highly developed integrated Health,
Safety and Environmental management system. 
Martin Brown has decided to retire this year; Martin
was Head of our Engineering Maintenance business.
I would like to thank him for the important contri-
bution he has made to MITIE over the years.
Building Services
Engineering Services
The trading climate in Engineering has not
improved since our Interim Report and margins
continue to be under pressure. In the coming year
Engineering Services will be focused on improving
margins, even though turnover growth as a conse-
quence may be lower.
A key focus of Engineering is to develop long-term
relationships with forward visibility. The University
of Plymouth has recently awarded MITIE an 
innovative three year Mechanical and Electrical
framework contract adding to the current list of
frameworks which include Boots, MOD Prime
South West, BT/Telereal and Annington Homes. 
With strong experience in education, Engineering is
well positioned for involvement in the Building
Schools for the Future programme. In the current
schemes MITIE are a Tier 2 Contractor for the
Birmingham Framework and have just completed
Turves Green School. There has been continued suc-
cess in the public sector with procurement routes
including LIFT and PFI/PPP . 
The focus on developing specialist solutions 
for our customers has seen on-going success. The 
specialist retail business, whose clients include
ASDA and Primark, has completed 14 projects for
Marks & Spencer and has now been awarded a major
store in Plymouth. The social housing business con-
tinues to grow with over 80% of its work under part-
nering contracts.
Since the year-end, the commitment of Engineering
to training and health & safety has been recognised
through two industry awards – Mechanical & Electrical
Specialist of the Y ear and HV AC Contractor of the Y ear .
Fit-out project in London
12 MITIE Group PLC Annual Report 2005 Service Repair and Maintenance
Sector Social housing
Client Sentinel Housing Group
Caring for residents and their properties at Oakfern
Sentinel Housing Group, incorporating Oakfern
and Hart Housing Associations, owns 8,500 houses
in the Basingstoke area, 7,500 of which are main-
tained by MITIE. The accommodation includes
sheltered housing, low-rise flats, semi-detached and
terraced housing.
We are responsible for all reactive repairs including
burst pipes, electrical faults, drainage, painting, plas-
tering and fences. When a property is empty we are
responsible for improving the condition of the
property as quickly as possible so that it is available
for occupation. Working with Sentinel we have
managed to reduce this time to an average of less
than three weeks.
MITIE has a dedicated office in Basingstoke in the
heart of the housing stock. This ensures that we are
“When a property is empty we are
responsible for improving the condition
of the property as quickly as possible so
that it is available for occupation.”
able to provide a service that is responsive to the
tenants’ needs. Arranging appointments efficiently
and completing work promptly is the key to cus-
tomer satisfaction. We operate a two-hour time
options system which allows the tenants to choose
time slots that fit in with their plans. An internet
based tracking system is used which enables us to
allocate efficiently the resources of the tradesmen
on the contract.
Market conditions for social housing are positive.
Underpinned by the Government’s ‘Decent Homes
Standard’ initiative, which aims to improve all
social housing across the country, this market looks
set to sustain significant growth for the future.
Increasing numbers of customers in this market are
awarding longer-term contracts with wider scope
and MITIE is well placed to benefit from this trend.
Chief Executive’s Review continued
MITIE Group PLC Annual Report 2005 13 In line with the objective of identifying growth
potential in both geographical and specialist 
markets, an opportunity for the development of
regional contracting businesses was identified in the
Channel Islands. The establishment of a Jersey
office confirmed the potential of this venture and 
a Guernsey office has since been opened to respond
to the opportunities on the Islands. 
Property Services
Property Services has had a good year, building
upon the performance in the first six months and
seeing increased levels of profitability. A strategic
decision was taken to change the corporate and
operational structure which was proving to be 
a barrier to tendering for the larger lucrative markets
of social housing, education and health. During the
year all of the trade from the wholly-owned sub-
sidiaries were merged into one business to form
MITIE Property Services (UK) Ltd. This is already
starting to produce improved results and will have a
positive impact on performance in the coming year. 
Property Services has increased its investment in 
its social housing and local authority team to accel-
erate growth in this market. Contracts will be 
performed with directly employed teams for 
refurbishment, repairs and maintenance. 
Several long-term contracts have been secured during
the period including Pavillion Housing Association,
Brent Decent Homes, Warden Housing Association,
Poole Housing Association and Southampton City
Council, that have a combined order book value in
excess of £60 million. Other contracts included a
major redecoration contract for North West Trains
and a refurbishment project for Durham University.
MITIE Interiors, the London-based fit-out business,
has had a very good year completing substantial
projects for Land Securities and Legal & General. 
Generation
Generation was sold to its management team on 30
September 2004 and marked our exit from capital-
intensive businesses. We wish them every success
for the future.
Dynamics of the business 
MITIE is fortunate that a high percentage of our work
comes from long-term contracts. Support Services is
able to grow steadily because it has an excellent
record of customer retention and a reputation for
providing quality services that meet the needs of the
customer. Building Services has traditionally been 
different with relatively short-term order books, 
however, this is changing with the trend towards 
partnering style or framework contracts, which 
has increased the visibility of Building Services’ order
book. The percentage of budgeted revenue secured
for 2006 is 70% compared to 67% last year. The 
percentage of revenue secured for 2007 is 44% 
compared to 42% last year.
Cash
MITIE is a cash-generative business. We recognise
that the assets of the business belong to the share-
holders and that it is our responsibility to maximise
the long-term return from those assets. During the
year we have increased the dividend by 36%, started
a share buyback programme and considered several
acquisitions. Since the year-end we have completed
the acquisition of Intruder for a consideration 
of £4 million. The Board regularly reviews the 
structure of the Group’s Balance Sheet, evaluates its
optimum structure and continues to make this an
important priority. 
Future prospects 
The business has excellent prospects. Our markets
are favourable despite being very competitive, they
have the capacity to sustain future growth. I am
confident that we can maintain our progress. 
I am always delighted to see the passion and com-
mitment of our employees. I would like to thank
each and every one of them for keeping that passion
alive and for driving our business forward and 
continuing to support our customers. 
Ours is not a business that is dependent upon 
technology or capital assets. It is a business that 
will succeed or fail based primarily on how good 
its people are, how well they work together and
anticipate and satisfy their customers’ needs. 
The people in MITIE are excellent and are 
confident about the future. Your Company is in
good hands and I am sure we will continue to deliver
good results.
Ian R Stewart Chief Executive
Waste Management at Rolls-Royce, Bristol
14 MITIE Group PLC Annual Report 2005 Service Security
Sector Government
Client Environment Agency
Helping to keep the Thames Barrier secure
With over 500 years experience between the manage-
ment team, MITIE Security is now ranked as the
eighth largest manned security provider nationally
and as the second largest in London. We have recent-
ly added to the range of services that we can provide
with the acquisition of Intruder International Ltd, 
a leader in the provision of integrated electronic 
security services. We now have a growing number of
prestigious security clients across a diverse range of
sectors, particularly in the City. Contracts where we
offer bespoke security solutions, include the Tower of
London, Tate Modern, the Office of the Deputy Prime
Minister and the Thames Barrier.
“We now have a growing number of
prestigious security clients across 
a diverse range of sectors.”
MITIE has been providing 24 hour manned guard-
ing services at the Thames Barrier for over four 
years and has recently had the contract extended.
Helping the Environment Agency to protect London
from flooding is no small feat, which is why we
have 17 officers on the contract who work in a three
shift pattern over each 24 hour period. It takes 
just under an hour to patrol the entire site, which
doesn’t include monitoring two external sites linked
to the Thames Barrier. 
Our commitment to training and education for offi-
cers ensures an added value service for the client, a
reduction in staff turnover and motivated employees.
Chief Executive’s Review continued
MITIE Group PLC Annual Report 2005 15 16 MITIE Group PLC Annual Report 2005
David C Ord Chairman
MITIE is in a
strong financial
position…
protecting the
interests of 
shareholders.
Ruby McGregor-Smith, Group Finance Director
The cash generative nature of our activities,
together with the move away from capital-
intensive businesses provides financial 
flexibility. We will direct funds to areas 
which generate shareholder value. 
Financial results
Turnover
Operating profit
Exceptional items
Profit
Goodwill
Taxation
Pensions
Acquisitions
Financial review
Returns to Shareholders
Treasury policy
Accounting developments
International Financial Reporting Standards (‘IFRS’)
Cash flows
Investment for the future
Going concern The effective rate of tax before exceptional items
and goodwill is 30.5% (2004: 30.5%).
Pensions
The Group operates two defined benefit pension
schemes and a defined contribution scheme for its
employees as described in Note 26. The total pension
charge for the year was £4.3 million (2004: £4.5 mil-
lion) with the defined benefit schemes accounting
for £3.3 million of this (2004: £3.6 million).
The Group continues to apply SSAP 24 in account-
ing for retirement benefits. The introduction of the
accounting standard FRS 17: Retirement Benefits has
been delayed by the Accounting Standards Board
until 2006. The Group has continued to apply the
transitional rules and disclosures as detailed in Note
26. At 31 March 2005, the actuary estimated that
there was a net deficit of £5.0 million (2004: £5.0
million) in relation to the defined benefit schemes.
The defined benefit schemes have a Minimum
Funding Requirement cover of 115%. Contribution
rates remain at 7.5% (2004: 7.5%) for employees and
at 10% (2004: 10%) for the Group Scheme.
Acquisitions
On 23 August 2004, the Group acquired some or all of
the minority interests in the following subsidiaries for
a total consideration of £3.5 million (See Note 20a):
■ MITIE Air Conditioning (North) Ltd
■ MITIE Engineering Services (Retail) Ltd
■ MITIE Roofing Services Ltd
■ MITIE Security (Scotland) Ltd
■ MITIE Greencote Ltd
2. Financial review
Returns to Shareholders
Earnings per share (‘EPS’)
EPS is based upon profits after tax and minority
interests and represents the amount of profit earned
by each share.
Basic EPS fell by 20.8% to 6.0p (2004: 7.6p). The
majority of this is due to the exceptional items
which reduced EPS by 2.7p.
EPS before exceptional items and goodwill grew by
15.0% from 8.3p in 2004 to 9.6p this year (see Note
7 for reconciliation to basic earnings per share).
Dividends
In 2004 we set a dividend policy to achieve an
annual dividend cover of no more than three times.
We also noted that we would review this policy on a
regular basis.
1. Financial results
Turnover
Total turnover increased by 17.9% to £818.6 million
(2004: £694.5 million). Turnover from continuing
business grew by 20.4% to £799.7 million. 
Operating profit
Total operating profit has increased by 15.1% to
£42.0 million (2004: £36.5 million). 
Operating profit from continuing operations 
has increased by 15.7% to £40.9 million (2004:
£35.4 million). 
Exceptional items
As the final step of the strategy to exit capital-inten-
sive businesses, the Company sold its entire share-
holding in Generation to a management buyout
team on 30 September 2004 for a total considera-
tion of £12.0 million. 
The accounting loss on sale comprised:
£m
Loss on sale excluding goodwill 3.4
Goodwill not previously amortised 1.2
Goodwill previously written off to reserves 5.0
9.6
A freehold property was also sold during the year
that resulted in a net profit of £1.5 million.
Profit
Profit on ordinary activities before tax, goodwill 
and exceptional items* was £46.9 million (2004:
£40.3 million), an increase of 16.3%. The net profit
margin on this basis is 5.7% compared to 5.8% in
the previous year. Profit before tax after goodwill
(£2.8 million, 2004: £2.2 million) and exceptional
items (£8.1 million, 2004: £nil) fell by 5.9% to 
£35.9 million.
* See Group Profit and Loss Account for reconciliation.
Goodwill
The increase in the goodwill amortisation charge to
£2.8 million (2004: £2.2 million) reflects a full year
of goodwill amortisation on the acquisition of three
companies in the previous year and the acquisition
of the minority shares in the businesses that earned
out during the year. 
Taxation
The tax charge for the year was £14.3 million, a rise
of 16.4% on last year’s charge of £12.3 million. The
effective tax rate is 39.8% (2004: 32.2%). The cur-
rent year effective rate is impacted significantly by
the loss on sale of Generation and goodwill amorti-
sation, both of which are not allowable for tax. 
Finance Director’s Review
MITIE Group PLC Annual Report 2005 17 The dividend total of 3.4p per share is at a cover of
2.9 times. For the purposes of calculating this cover
we have ignored the impact of goodwill amortisa-
tion and the exceptional items in the year.
Share buybacks
The Company has acquired 3.4% of its own share
capital in the year, equating to 10,310,006 shares,
all of which were cancelled. In total these cost 
£14.9 million.  
Treasury policy
Group Treasury has responsibility for managing and
reducing financial risk and ensuring sufficient 
liquidity is available to meet foreseeable needs. 
It operates within policies and procedures approved
by the Board which have not changed during the
year. Borrowings are arranged centrally by Group
Treasury and made available to operating sub-
sidiaries on commercial terms. The Board’s on-going
policy is to finance the Group through retained
earnings and borrowings. 
The Group’s exposure to interest rate fluctuations is
currently limited to the performance of our net
funds position. A portfolio of AAA rated funds,
money market deposits and corporate deposit
accounts is used to maximise returns from funds,
while minimising overall exposure to any one
financial institution. 
The maturity profile of banking facilities is reviewed
regularly and the facilities are extended and replaced
as appropriate well in advance of their expiry.
Further details on financial assets and liabilities are
given in Note 15 to the Accounts.
Accounting developments
There have been no significant impacts arising 
as a result of changes in UK Generally Accepted
Accounting Principles in the year.
International Financial Reporting Standards
(‘IFRS’)
IFRS will be adopted in the Group’s consolidated
accounts for the year end 31 March 2006. The
Group will publish accounts under IFRS for our
2006 interim results and restate 31 March 2005 
figures for comparative purposes.
The Group’s transition project to prepare for this
has continued during the year. Other than the addi-
tional disclosures and presentational differences,
IFRS is expected to have the most impact for the
Group in the following areas:
■ Share based payments (IFRS 2)
■ Goodwill amortisation (IFRS 3)
■ Pensions (IAS 19)
■ Deferred tax (IAS 12)
On pages 59 to 60 we have provided further expla-
nations of each of these items, and where approp-
riate the estimated financial impact. We have also
detailed the exemptions taken by the Group on the
adoption of IFRS as set out in IFRS 1: First time adop-
tion of International Accounting Standards.
Cash flows
Net funds increased by £11.2 million during the
year from £49.3 million to £60.5 million. The total
cash inflow in the year was £10.5 million (2004:
outflow of £7.8 million).
The Group has generated £46.9 million (2004:
£43.9 million) from operating activities. 
Tax paid in the year was £13.5 million (2004: £12.4
million) and net capital expenditure reduced to
£10.8 million (2004: £12.7 million). 
Of the £3.5 million consideration for the acquisitions
of minority interests in subsidiaries, £0.2 million was
in cash. We also received £8.9 million on the disposal
of a subsidiary undertaking, which represented the
overdraft. In the previous year we had a net outflow
of £23.7 million from acquisitions in the year.
Investment for the future
Acquisitions
As noted above, during the year the Group acquired
some or all of the minority interests in five of its
subsidiaries for a total consideration of £3.5 million
of which £0.2 million was in cash.
18 MITIE Group PLC Annual Report 2005
Dividend growth
0.0 
0.5 
1.0 
1.5 
2.0 
2.5
3.0 
3.5
4.0 
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Year
Pence Since the year-end, on 4 May 2005, the Group
acquired the entire share capital of Intruder. The
total consideration was £4 million. The total consid-
eration can increase by up to a further £0.5 million
to the extent that the net assets at completion of
Intruder exceed £0.95 million. The final considera-
tion will be confirmed in our Interim Report for the
period ending 30 September 2005. In the year to 
31 October 2004, Intruder’s turnover was £4.31 
million, pre-tax profits were £0.45 million and net
assets were £0.94 million as at 31 October 2004.
Capital expenditure
Capital expenditure as a percentage of turnover.
As the Group has grown and continues to grow
strongly, measuring total capital expenditure does not
provide a useful measure of performance; we therefore
measure our capital expenditure as a percentage of
turnover. Over the last five years this has fallen from
4.6% of turnover to 1.3% in the current year.
This clearly reflects the Group’s stated objective to
move away from capital-intensive businesses.
Generation, which was disposed of earlier in the
year, was the final step in achieving this objective.
This policy allows us to reduce the amount of capital
tied up in long-term projects and to direct funds to
other areas which generate greater shareholder value.
Going concern
The Directors have formed a judgement, at the time
of approving the financial statements, that there is a
reasonable expectation that the Group has adequate
resources to continue in operational existence for
the foreseeable future. For this reason, the Directors
continue to adopt the going concern basis in
preparing the financial statements.
Ruby McGregor-Smith Group Finance Director
Finance Director’ s Review continued
MITIE Group PLC Annual Report 2005 19
Capital expenditure
0 
1.0
2.0
3.0
4.0
5.0
6.0
1999 2000 2001 2002 2003 2004 2005
Year
% 20 MITIE Group PLC Annual Report 2005
Our sustainable
approach...
helps our 
customers be 
environmentally
conscious too.
Integrating social and environmental concerns in
business operations and in our interaction with
stakeholders is important to MITIE. The period
under review has witnessed improvements and 
initiatives in all areas.
We have taken steps to develop our corporate
responsibility function further this year by appoint-
ing Stephen Barthorpe. He has joined us from the
University of Glamorgan, having held a Head of
Division post in the School of Technology and
Environment. He has already initiated a programme
of further training of Group’s Directors.
People
MITIE recognises that our people are vital to our 
success and we are suitably dedicated to implement-
ing a comprehensive and proactive HR strategy with
policies and procedures that ensure all employees are
treated in a socially and ethically responsible manner. 
Similarly, we want to ensure that all employees have
the opportunity to maximise their potential,
achieve their goals and progress their careers.
MITIE’s training programme therefore includes
both external programmes as well as in-house courses
and encourages staff at all levels to improve their
skill sets. Current training includes the ILM
Certificate in First Line Management, the CMI
Diploma in Management and the Business
Leadership programme. In addition to the training
programme, structured induction courses take place
during the year across the UK, which help commu-
nicate our vision and values and inform staff of what
they should expect from MITIE as an employer.
These have recently been reviewed and improved in
line with employee feedback. Our focus on training
has recently been recognised with an award for
M&E Contractor of the Year 2005 at the first annual
Construction News Specialists in Construction
Awards, where MITIE was commended for its com-
mitment to staff training and development. 
MITIE is an ‘Investor in People’, a standard which 
further helps to benchmark how we communicate
with and involve our people and provides us with 
MITIE Construction Skills Centre, St. Luke’s School, Portsmouth
“MITIE has always endorsed a 
corporate value of trying to assist
people to fulfil their potential.”
MITIE has always endorsed a corporate value of
trying to assist people to fulfil their potential,
whatever their background. It was in this spirit
and in commemoration of David Telling,
MITIE’s founder, whose philosophy revolved
around providing others with opportunities,
that the decision was taken to roll-out the
MITIE Construction Skills centres as part of 
a national scheme.
Our aim is to help provide 14 to 16 year old
students, whose needs are best met via an inte-
grated learning approach of curriculum and
the world of work, with vocational education
opportunities. In doing so, we can help pupils
learn new and valuable skills and increase
their chances of employability. This will also
help to address the current skills shortage in
the building services sector. 
MITIE staff are actively involved with these
centres, assisting with the curriculum and 
acting as mentors where deemed appropriate. Corporate Responsibility
MITIE Group PLC Annual Report 2005 21
a framework to ensure that employees have the right
knowledge, skills and leadership to work efficiently.
MITIE is also an Equal Opportunities employer that is
pleased to have the opportunity of recruiting disabled
people from the Shaw Trust, individuals from the
Skills for Life Initiative for numeracy and literacy, as
well as people from the Employment & Regeneration
Partnership for the long-term unemployed. 
MITIE believes that exceptional effort deserves
recognition, reward and thanks. This is reflected in
the numerous awards initiatives throughout MITIE,
including the David Telling Excellence Awards and
the IMPACT awards. The former are selected at 
a Group level for individuals or teams of people who
have achieved or behaved exceptionally and made a
outstanding contribution to the business. The latter
are awards, where employees can be nominated by
fellow colleagues or clients for showing initiative,
providing exceptional customer satisfaction, sup-
porting colleagues or motivating others.
We have recently become members of ‘Business in
the Community’ which looks to inspire, challenge
and support businesses by continually improving
their impact on society. We have made a commit-
ment to action through the three membership 
obligations: integrate; manage and measure; and
responsible business practice.
MITIE became a corporate member of the Drug &
Alcohol Training Service (DATS) scheme during the
year. This will help raise drug and alcohol awareness
through the implementation of workplace policies
and training to support those staff affected by sub-
stance misuse and underlines the organisation’s com-
mitment to socially responsible employee relations. 
MITIE recognises its obligations to follow the latest
guidance regarding informing and consulting with
its employees. MITIE considers that this will benefit
the company in terms of additional lines of commu-
nication and provide enhanced knowledge in the
important roles that our employees have to play in
helping the Group achieve its goals. At the same time
it provides a forum to discuss personal development
and training of our employees. To this end the 
MITIE Employees’ Forum has now been established.
Elections for delegates are to take place representing
all the Group businesses. The Chief Executive will
chair two meetings a year.
Ethics
MITIE adopts the highest ethical standards and princi-
ples with all of our stakeholders and ensures that our
ethical performance is regularly reviewed. Our Code
of Ethics is communicated to employees at all levels in
order that they are able to raise any concerns regard-
ing behaviour which may be perceived as unethical. 
In line with emerging best practice, MITIE has initiat-
ed a ‘Whistle-blowing’ policy and procedure enabling
our employees to report on any areas where they feel
that our corporate values are not being upheld.
MITIE’s data protection policy and code of practice
have been revised. In line with safeguarding our
employees’ interests, in-house seminars are held reg-
ularly to train and increase awareness on the prob-
lems associated with the data protection legislation.
“Helping the younger generation
appreciate the importance of
safeguarding the environment
and the contribution they can
make to the future.”
MITIE has recently been engaged with a local
eco-school in Caerphilly, South Wales, to
research childrens’ views on the future envi-
ronment. MITIE sponsored a competition for
the school children to design an eco-poster
showing what damage they believe adults are
doing to the environment and how pollution
can be stopped. We are using the winning
illustration as the front cover for MITIE’s
Waste & Environmental brochure. 
Every child received a sapling for them to take
home and plant in their own gardens and took
part in planting two Japanese maple trees, 
presented by MITIE, in the playground. The
school received a donation for their library and
enjoyed a lecture on sustainability, helping the
younger generation appreciate the importance
of safeguarding the environment and the con-
tribution they can make to the future.
Winning child’s design for front cover of a MITIE brochure Health and Safety
The need to maintain a safe and healthy workforce
remains a priority for MITIE and we are continually
striving to improve our safety performance. This is
taken extremely seriously from the Board down,
commencing with the Chief Executive, who has
overall responsibility for health and safety. 
It is essential to recognise, however, that it is not 
possible for one individual to safeguard employees’
wellbeing and MITIE has acknowledged the impor-
tance of our employees taking ownership for their
welfare while at work. Therefore, during the last
year, we have commenced a publicity campaign to
communicate to staff the importance of taking
responsibility for their own health and safety. This
has seen the production of posters and wallet-sized
cards highlighting our partnership approach to
keeping all employees fit and healthy while at work
and underlining the standards MITIE’s manage-
ment should aim to achieve when dealing with
health and safety. In addition, we have produced an
in-depth safety video that is used during the induc-
tion and training of all employees.
We recognise the importance of safety training 
in developing our workforce and have embarked on
a thorough review of such needs of all MITIE
employees. Subsequently, we are now working with
a variety of training providers to design and deliver
training specific to individuals’ needs, to improve
our safety performance and reduce costs. 
One of the major risks faced by many MITIE
employees is that presented from road travel. 
In August 2004 we commissioned the Royal Society
for the Prevention of Accidents to carry out a review
of MITIE’s road risk and identify areas where we
could improve our management of this area of
MITIE’s operations. 
MITIE has been prepared for the introduction of the
Work at Height Regulations 2005 that came into
force in April 2005 and has had a work at height
policy in place since June 2003, exceeding the
requirements of the new legislation. 
We continue to improve our accident reporting and
investigation procedures and during the last year we
have added the capacity to record accident investi-
gation data to our accident reports, enabling us to
better identify the causes of accidents. 
Environment
MITIE endeavours to identify, monitor and manage
the impact of its activities on the environment 
and is fully committed to environmental account-
ability and protection. All MITIE businesses are 
covered by the Group Environment Policy. This 
policy is communicated to employees when they
receive their induction training at the start of 
their employment.
In excess of 75% of the Company’s activities, 
in terms of employee numbers, are covered by 
a certified environmental management system. 
Managed Services, Cleaning and Engineering
Maintenance are certified to the environmental
standard ISO 14001 and operate a management 
system in accordance with the controls, policies and
systems applicable for that standard. Employees 
are trained in accordance with an internal package
of training programmes. Our trainers have been
accredited by the Chartered Institute of Waste
Management. A further ten percent of our employees
are operating in manned guarding security and their
work has no material impacts or aspects relating to
the environment. The remaining businesses are
making progress towards ISO 14001.
MITIE held a waste management forum to help
bring clients up to date with compliance issues and
changes in European and UK directives, which are
being introduced in the coming financial year.
Waste management is also being advanced on our
contracts, with the creation of TREEHUGGER
™
, a
paper-saving device which aims to lessen the strain
on natural resources. Over 12,000 units are being
used by clients to boost their recycling efforts. 
Community
MITIE has continued to embrace social responsibility
by participating in several community projects, 
but principally by developing a national initiative 
for construction skills centres. What was initially 
a one-off concept, launched at St Luke’s School,
Portsmouth in 2001, will now be rolled-out to three
other schools in 2005 with the intention to open
three more in 2006. They will be known as the
MITIE Skills Centres and will be used by the schools
to teach nationally recognised qualifications.
Another community project included an Engin-
eering-led scheme to develop sustainable solutions at
Kingsmead Primary School, Liverpool, where MITIE
created an intelligent ‘Building Management System’,
which automatically controls ventilation, heating,
lighting and roof-light shading to significantly reduce
the client’s energy bills. As well as serving to save costs
and energy, the system acts as an educational tool for
staff, pupils and the local community. 
A wide range of fundraising activities have also
taken place for the NSPCC, our Charity of the Year
for the second year running, including a national
bowling competition where over £55,000 was
raised, as well as marathons and triathlons, quiz
nights, golf days and parachute jumps. Other local
initiatives included supporting the Lions Inter-
national Spectacle Recycling Scheme with client
Land Securities, collecting over 1,500 pairs of glasses,
that were later repaired and classified and then 
distributed to developing countries. MITIE also
donated old workwear to In Kind Direct, a charity
founded by HRH The Prince of Wales, which sent all
of the clothing to Africa for distribution. At the end
of the period under review, our two-year relation-
ship with the NSPCC came to an end. We held an
employee vote to select our new corporate charity
and Cancer Research UK received overwhelming
support. We look forward to building a fundraising
relationship with them.■
22 MITIE Group PLC Annual Report 2005 Board of Directors
MITIE Group PLC Annual Report 2005
Ian R Stewart 
Chief Executive
Aged 63, he was appointed to the Board in
January 1990 and became Chief Executive in
August 2001. He is also a Non-Executive Director of
Generation (UK) Ltd.
Ruby McGregor-Smith ACA 
Group Finance Director
Aged 42, she joined the Group and was appointed
to the Board in December 2002. She was previously
at Serco Group plc.
Colin S Acheson 
Director responsible for Engineering Services
Aged 54, he joined the Group in December 
1989 and was appointed to the Board in 
August 2001. He is also a Non-Executive Director 
of The Platform Company (Holdings) Ltd and 
The Platform Company (UK) Ltd.
N Roger Goodman 
Group Corporate Development Director
Aged 58, he joined the Group in June 1993 and
was appointed to the Board in August 2001.
Colin S Hale 
Head of Support Services
Aged 48, he joined the Group in April 1998 and
was appointed to the Board in August 2001.
Bill Robson 
Director responsible for Property Services
Aged 54, he joined the Group in January 1992
and was appointed to the Board in August 2001.
David C Ord
*†§
Non-Executive Chairman 
Aged 56, he was appointed to the Board in
October 2002 and became Chairman in
September 2003. He is Managing Director of 
The Bristol Port Company.
Sir John Jennings CBE, FRSE
*†§
Non-Executive Deputy Chairman,
Chairman of the Nomination Committee and
Senior Independent Non-Executive Director 
Aged 68, he became a Director in 1998 and 
is a member of the International Advisory 
Boards of the Bechtel and Toyota Corporations, 
a Director of Bechtel Group International and
Chancellor of Loughborough University. He was
previously Chairman of the Shell Transport and
Trading Company plc.
Manish J Chande
*†§
Non-Executive Director and Chairman of the
Remuneration Committee
Aged 49, he was appointed to the Board in July
2002. He is Chief Executive of Mountgrange Capital
plc and also Non-Executive Chairman of National
Car Parks Ltd. He was previously Chief Executive of
Land Securities Trillium Ltd and a board member 
of Land Securities plc.
Cullum McAlpine
*†
Non-Executive Director and Chairman of the
Audit Committee
Aged 58, he was appointed to the Board on 1 April
2003. He is also a Director of Sir Robert McAlpine Ltd
and Chairman of Renewable Energy Systems Ltd.
* Member of the Remuneration Committee.
† Member of the Audit Committee.
§ Member of the Nomination Committee.
23 The Directors submit their Report together with the
audited financial statements for the year ended
31 March 2005.
Principal activity
The principal activity of the Group is the provision
of services to buildings and infrastructure. The 
principal activity of the Company is to provide
management services to the Group.
Results and dividends
The Group profit on ordinary activities before tax
amounted to £35.9 million (2004: £38.2 million),
which, after tax and minority interest, gives profits
attributable to Shareholders of £18.4 million (2004:
£23.4 million). The Directors recommend a final
dividend of 1.8p per share, which, together with
the interim dividend of 1.6p per share paid on 
31 March 2005, results in a total dividend of 
3.4p (2004: 2.5p) per share. If approved, the final
dividend will be paid on 30 September 2005 to
those Shareholders registered on 2 September
2005. The retained profit for the year is £8.3 million
(2004: £15.5 million).
The review of the year’s operations and future
developments are contained in the Chairman’s
Statement, the Chief Executive’s Review and the
Finance Director’s Review. 
Donations
Charitable contributions made during the year
amounted to £85,300 (2004: £36,000). Included in
donations were £27,000 to the NSPCC, £25,000 to
the Tsunami Appeal and £15,000 to The Greater
Bristol Foundation. The remainder of the donations
were made to local charities serving the commu-
nities in which the Group operates. As a matter of
policy, no political contributions were made 
during the year (2004: £nil).
Share capital
Details of changes in the share capital during the
year and the number of Ordinary Shares in issue at
the year-end are set out in Note 17 to the Accounts.
Share buyback programme
In June 2004 the Company commenced a share
buyback programme pursuant to the authority
given by Shareholders at the Annual General
Meeting in 2003, which was subsequently renewed
and extended at the Annual General Meeting 
in 2004. During the year to 31 March 2005 the
Company purchased a total of 10,310,006 Ordinary
Shares, representing 3.4% of the issued share 
capital of the Company, for a total consideration 
of £14,912,388. Since the year end the Company
has completed the purchase of a further 192,305
Ordinary Shares for a consideration of £311,534. 
All Ordinary Shares purchased have been sub-
sequently cancelled. Further details are given in
Note 17 to the Accounts. The exact amount and
timing of future purchases, and the extent to which
repurchased shares may be held as treasury shares
rather than being cancelled, will be determined by
the Company and will be dependent on market
conditions and other factors.
Directors
Details of the Board of Directors are given on
page 23. 
There were no appointments or resignations of
Directors during the year.
In accordance with the Company’s Articles of
Association, Ian R Stewart, Manish J Chande 
and Sir John Jennings will retire by rotation and,
being eligible, offer themselves for re-election 
at the AGM. 
The Board considers that the performance of
those Directors proposed for re-election continues
to be effective and that they demonstrate a
strong commitment to their role.
Details of the Directors’ interests in the share 
capital of the Company are shown in the Directors’
Remuneration Report.
Going concern
The Directors have formed a judgement that there
is a reasonable expectation that the Company
has adequate resources to continue in opera-
tional existence for the foreseeable future. For this
reason, the Directors continue to adopt the going
concern basis in preparing the Accounts.
Payment of creditors
The Group’s policy is to comply with the terms of
payment agreed with suppliers. Where terms are
not negotiated, the Group endeavours to adhere
to the suppliers’ standard terms. At 31 March 2005,
the Company had 17 days purchases outstanding
(2004: three days).
Other interests in shares
The Company has been notified of the following
interests in 3% or more of the issued share capital
of the Company as at 19 May 2005.
Number of
ordinary shares % of share 
of 2.5p each capital
Fidelity Corp. and 
Fidelity International Ltd 45,576,170 15.04
Prudential plc 31,338,887 10.34
Aviva plc 11,304,016 3.73
24 MITIE Group PLC Annual Report 2005 MITIE Group PLC Annual Report 2005 25
Director’s Report
possible re-issue at a future date, rather than can-
celling them as had previously been required by
legislation. Accordingly, if the Company were 
to purchase any more of its own shares, it would
consider holding them as treasury stock, pursuant
to the authorisation conferred by this resolution. This
would give the Company the ability to re-issue
treasury shares quickly and cost-effectively, and
would provide the Company with additional flexi-
bility in the management of its capital base.
Resolution 10 seeks to amend the Company’s exist-
ing Articles of Association. Under the Company’s
current Articles, one third of the Directors are
required to retire by rotation at each Annual
General Meeting. In accordance with recent cor-
porate governance guidelines, the Directors now
recommend that the Articles be amended to
ensure that every Director shall be required to retire
by rotation at least every three years.
Statement of Directors’ responsibilities
United Kingdom company law requires the
Directors to prepare financial statements that give
a true and fair view of the state of affairs of the
Company and the Group as at the end of the
financial year and of the profit or loss of the Group
for that period. In preparing those financial state-
ments the Directors are required to:
■ select suitable accounting policies and then
apply them consistently;
■ make judgements and estimates that are 
reasonable and prudent; and
■ state whether applicable accounting stan-
dards have been followed, subject to any
material departures disclosed and explained
in the financial statements.
The Directors have responsibility for ensuring that
the Company keeps accounting records that dis-
close with reasonable accuracy at any time the
financial position of the Company and that
enable them to ensure that the financial state-
ments comply with the Companies Act 1985. The
Directors also have general responsibility for the
system of internal controls, for taking such steps as
are reasonably open to them to safeguard the
assets of the Group and to prevent and detect
fraud and other irregularities.
This Report was approved by the Board of
Directors on 20 May 2005 and signed on its behalf.
Corina K Ross Company Secretary
Employee involvement
The Group offers equal opportunities to all appli-
cants for employment whatever their sex, race or
religion. Disabled persons are considered for
employment, training, career development and
promotion on the basis of their aptitudes and abil-
ities in common with all employees, providing the
disability does not make the particular employ-
ment impractical, or the employee is unable to
conform to the stringent regulations that apply to
the operations of the trading companies.
The Directors acknowledge the importance of
good communications and employee relation-
ships. In each trading company, there is a direct
relationship between the Managing Director and
individual employees of the company. 
The Directors believe that employees should 
be encouraged to become shareholders. The
Savings Related Share Option Schemes, estab-
lished in 1991 and 2001, currently have a total of
1,561 (2004:1,828) contributing employees.  
MITIE is in the process of establishing an Employees’
Forum to comply with the requirements of the
Information and Consultation regulations. 
Auditors
Deloitte & Touche LLP have expressed their willing-
ness to continue in office as Auditors and a resolu-
tion to reappoint them will be proposed at the
forthcoming Annual General Meeting.
Annual General Meeting
The Annual General Meeting will be held at 12
noon on Thursday, 28 July 2005 at The Merchants’
Hall, The Promenade, Clifton Down, Bristol.
The Resolutions to be proposed at the AGM are
contained in the Notice of Meeting.
Resolution 8 renews the Directors’ authority to allot
new Ordinary Shares, not exceeding 5% of the
issued share capital, for cash without first being
required to offer them to existing Shareholders in
the proportion of their holdings. 
Resolution 9 renews the Company’s authority to
purchase its own shares, not exceeding 10% of the
issued share capital. The Directors will continue to
exercise this authority if satisfied that to do so would
result in an increase in the Group’s earnings per
share and would be in the interests of Share-
holders generally. Following the introduction of The
Companies (Acquisition of Own Shares) (Treasury
Shares) Regulations 2003 companies are now per-
mitted to retain any of their own shares which they
have purchased as treasury stock with a view to This Report has been prepared in accordance with
the Directors’ Remuneration Report Regulations
2002. It also meets the relevant requirements of
the Listing Rules of the Financial Services Authority
and describes how the Board has applied 
the Principles of Good Governance relating 
to Directors’ remuneration. As required by the
Regulations, a Resolution to approve the Report
will be proposed at the AGM of the Company at
which the financial statements will be approved.
The Regulations require the Auditors to report to
the Company’s members on the ‘auditable part’
of the Directors’ Remuneration Report and to
state whether in their opinion that part of the
Report has been properly prepared in accor-
dance with the Companies Act 1985 (as amend-
ed by the Regulations). The Report has therefore
been divided into separate sections for audited
and unaudited information.
Information not subject to audit
Remuneration Committee
The Committee consists of four of the Company’s
Non-Executive Directors; Manish J Chande
(Chairman), Cullum McAlpine, Sir John Jennings,
and David C Ord. The Committee consults the
Chief Executive about its proposals and has
access to professional advice from outside the
Company. During the year, the Committee did
not receive any material assistance from any
external professional advisers. 
Remuneration policy
The basic salaries and other benefits of the
Executive Directors are determined by the
Committee in the light of the need to attract,
retain and motivate Directors of the calibre 
needed and to reward them for enhancing value 
to Shareholders. The Committee has regard to 
executive remuneration packages of similar 
jobs in comparative groups of companies. There
are no current plans to significantly alter this  for
future years. 
Executive Directors are entitled to accept
appointments outside the Group, providing per-
mission is sought from the Chief Executive, and to
retain earnings from such appointments. Further
details are shown in Note 27.
Components of remuneration
Components of remuneration are:
■ Basic salary determined by the Committee
and reviewed annually on 1 April;
■ Performance-related bonus based on improve-
ments in Group and/or Business profits;
■ Pension contributions through membership of
the Company’s pension scheme. Basic salary
alone is pensionable; and
■ Executive share options and opportunities 
to invest in subsidiary companies for Ruby
McGregor-Smith.
Service contracts 
All Executive Directors have rolling service con-
tracts, providing for a maximum of one year’s 
written notice. There are no provisions for com-
pensation payable upon early termination in the
Directors’ contracts.
Manish J Chande, Sir John Jennings and David C
Ord are appointed under fixed-term agreements,
which are due to expire on 31 March 2006. Cullum
McAlpine’s agreement expires at the Company’s
Annual General Meeting, in 2006. All agreements
may be renewed on expiry by mutual agreement
or terminated on six months’ written notice. These
agreements required the Director to attend all
meetings as notified by the Group, to serve on the
Audit, Nomination and Remuneration Committees
as the Group may request and to carry out such
additional functions as the Group may require.
Non-Executive Directors’ remuneration
The remuneration of Non-Executive Directors is
determined by the Board and reflects the know-
ledge and experience that they bring to the
Group. They do not participate in the Company’s
bonus or share option schemes. They are not
members of the Company’s pension schemes,
nor do they receive taxable benefits in kind. 
Manish J Chande’s, Sir John Jennings’ and David
C Ord’s remuneration comprises shares in MITIE
Group PLC at the market value on the issue date.
Cullum McAlpine’s remuneration comprises an
annual fee, which he has elected to waive for this
and subsequent years until further notice.
Performance graph – MITIE’s TSR vs FTSE Mid
250 index
The following graph shows the Company’s per-
formance, measured by Total Shareholder Return
(’TSR’), compared with the performance of the
FTSE Mid 250 index over the past five years. The
Committee believes that this comparison pro-
vides a clear picture of how well the Company
has performed relative to a range of companies
of a comparable size.
26 MITIE Group PLC Annual Report 2005 Director’s Remuneration Report
MITIE Group PLC Annual Report 2005
Information subject to audit
Remuneration
The table below provides details of Directors’ remuneration paid to or receivable by each person who served as 
a Director at any time during the year. 
Performance
Date of Base salary related 2005 2004
latest principal /fees bonuses Benefits Pensions total total
contract £’000 £’000 £’000 £’000 £’000 £’000
Executive Directors
I R Stewart 1 April 2004 300 263 25 50 638 542
C S Acheson (i) 1 April 2004 170 – 16 10 196 176
N R Goodman 1 April 2004 200 131 16 10 357 226
C S Hale 1 April 2004 225 225 16 10 476 559
R McGregor-Smith 1 April 2004 225 197 16 10 448 303
W Robson 1 April 2004 170 170 16 10 366 246
Former Executive Directors
D M Telling (former Chairman) – – – – – 174
Non-Executive Directors
M J Chande (ii) 23 September 2002 24 – – – 24 18
Sir John Jennings 26 April 2004 65 – – – 65 49
C McAlpine (iii) 27 March 2003 – – – – – –
D C Ord (Chairman) 26 April 2004 91 – – – 91 50
Former Non-Executive Directors
D C Macpherson – – – – – 14
Total 1,470 986 105 100 2,661 2,357
(i) C S Acheson waived his entitlement to bonus in this and the previous year. Under his contract of service he was entitled to £56,100 (2004: £22,500).
(ii) Under an agreement to provide the Group with the services of M J Chande, fees were paid to a third party, Mountgrange Limited, of £24,338
(2004: £18,375). 
(iii) C McAlpine has formally waived his entitlement to fees for this year and for the foreseeable future. In recognition of this fact, MITIE Group PLC has
made contributions to charity totalling £15,000 during the year (2004: £15,000).
27
TSR is defined as the return Shareholders would
receive if they held a notional number of shares
and received dividends on those shares over a
period of time. It measures the percentage
growth in the Company’s share price, together
with the value of any dividends paid, assuming
that the dividends are re-invested in the
Company’s shares.
Total Shareholder Return
MITIE FTSE 250
0
20
40
60
80
100
120
140
160
Mar 00 Sep 00 Mar 01 Sep 01 Mar 02 Sep 02 Mar 03 Sep 03 Mar 04 Sep 04 Mar 05
Source: Datastream
Index
Date 28 MITIE Group PLC Annual Report 2005
Pensions
The pension benefit of Directors who are members of the MITIE Group PLC defined benefit pension scheme is set 
out below:
Increase Real 
Accrued in accrued increase Accrued
pension pension during in accrued pension
31 March 2004 the year pension 31 March 2005
£’000 £’000 £’000 £’000
I R Stewart 98 17 14 115
C S Acheson 3021 32
N R Goodman 1622 18
C S Hale 1012 11
R McGregor-Smith 211 3
W Robson 2021 22
The following table sets out the transfer value of the Directors’ accrued benefits under the defined benefit pension
scheme calculated in a manner consistent with ‘Retirement Benefit Schemes – Transfer Values (GN11)’ published by
the Institute of Actuaries and the Faculty of Actuaries.
Increase
in accrued Real increase
Contributions pension over in accrued
Transfer value made by the year (net pension (net Transfer value
31 March 2004 the Director of contributions) of contributions) 31 March 2005
£’000 £’000 £’000 £’000 £’000
I R Stewart 1,445 23 16 203 1,841
C S Acheson 267 8 2 6 321
N R Goodman 186 8 2 11 230
C S Hale 64 8 2 4 86
R McGregor-Smith 8 8 2 2 19
W Robson 181 8 2 1 223
The transfer values disclosed above do not represent a sum paid or payable to the individual Director. Instead they
represent a potential liability of the pension scheme.
Directors’ interests
The beneficial interests of the Directors who were in office on 31 March 2005 in the share capital of the Company are
as shown below:
31 March 2005 1 April 2004 
Ordinary Shares Ordinary Shares
of 2.5p of 2.5p
£’000 £’000
Executive Directors
I R Stewart 4,992,872 4,992,872
C S Acheson 1,173,100 1,173,100
N R Goodman 1,437,213 1,543,213
C S Hale 641,134 2,041,134
R McGregor-Smith 9,353 9,353
W Robson 1,814,713 1,814,713
Non-Executive Directors
D C Ord 172,769 138,957
M J Chande 57,508 42,508
Sir John Jennings 894,567 1,270,567
C McAlpine 40,000 – Director’s Remuneration Report continued
MITIE Group PLC Annual Report 2005
Directors also had beneficial interests in the share capital of subsidiary companies as follows:
31 March 2005 1 April 2004
No. No.
R McGregor-Smith
MITIE Business Services Ltd B Ordinary Shares of 1p each 3,500 3,500
MITIE Catering Services (London) Ltd B Ordinary Shares of £1 each 5,000 –
MITIE Engineering Services (Edinburgh) Ltd B Ordinary Shares of £1 each 2,000 –
MITIE Engineering Services (North East) Ltd B Ordinary Shares of £1 each 1,500 –
MITIE Engineering Services (West Midlands) Ltd B Ordinary Shares of £1 each 1,500 –
MITIE Industrial Cleaning (North) Ltd B Ordinary Shares of £1 each 1,750 –
MITIE Landscape (Northern) Ltd B Ordinary Shares of £1 each 3,300 –
MITIE Security (South West) Ltd B Ordinary Shares of £1 each 3,200 –
MITIE Services (Retail) Ltd B Ordinary Shares of £1 each 10,000 10,000
MITIE Transport Services Ltd C Ordinary Shares of £1 each 4,500 –
N R Goodman
MITIE Catering Services Ltd B Ordinary Shares of £1 each 8,333 8,333
Directors also had interests in share options as follows:
Options Granted Lapsed Exercised Options Exercise
outstanding at during the during the during the outstanding at price Date Expiry
1 April 2004 year year year 31 March 2005 pence exercisable date
R McGregor-Smith
(i) 22,700 – – – 22,700 132 9.8.06 9.8.13
(ii) 77,300 – – – 77,300 132 9.8.06 9.8.13
(ii) – 100,000 – – 100,000 127 12.6.07 12.6.14
The share options stated above were granted under the MITIE Group PLC Executive Share Option Scheme 2001. 
(i) Granted under the Approved Part of the Scheme. (ii) Granted under the Unapproved Part of the Scheme.
The performance criterion for the Scheme that must be met requires a percentage growth in the Company’s earn-
ings per share equal to or in excess of 10% per annum compound over the period from the date of grant of the
option to the date on which the option first becomes exercisable. The performance criterion selected is no different
for the Director than for any other member of the Scheme.
No payment was made for the grant of the options and there have been no variations to the terms and conditions or
performance criterion for share options since the grant date.
The market price of Ordinary Shares of 2.5p each at 31 March 2005 was 161.25p and the highest and lowest prices
during the year were 168p and 112p respectively.
Other than as stated above, no other changes in Directors’ interests have taken place since 1 April 2005 and no
options have been granted to any Director since 1 April 2005.
This report was approved by the Board of Directors and signed on its behalf.
Manish J Chande Chairman,
Remuneration Committee
29 This statement, together with the Directors’
Remuneration Report on pages 26 to 29, explains
the manner in which the Board of MITIE Group PLC
has applied the principles and provisions of good
governance set out in the Combined Code on
Corporate Governance (the ‘Code’) published
by the Financial Reporting Council in July 2003. 
It is the policy of the Board of MITIE Group PLC 
to manage its affairs in accordance with these
principles and provisions and achieve the highest
standards of corporate governance to fulfil the
Group’s corporate responsibilities and the achieve-
ment of its financial objectives.
The Board and its Committees
Board of Directors
The Board of MITIE Group PLC currently comprises
six Executive and four Independent Non-Executive
Directors, including the Non-Executive Chairman.
Their biographical details, shown on page 23,
demonstrate the range of experience, skill, and
independent judgement they each bring to 
the Board. There have been no changes to the 
composition of the Board or its Committees during
this financial year.
The Board recognises that its current balance does
not comply with the requirements of the Code in
respect of Section A.3.2 which requires at least half
the Board, excluding the Chairman, to comprise
Independent Non-Executive Directors. The Board
and Nomination Committee are satisfied that the
structure and composition of the Board had
included throughout the year the appropriate
skills, knowledge, and experience to effectively
manage the Group and the Group’s affairs. 
The Nomination Committee will however continue
to review this position and initiate a recruit-
ment process for additional Independent Non-
Executive Directors if considered appropriate.
The Non-Executive Directors are David C Ord,
Manish J Chande, Sir John Jennings and Cullum
McAlpine. All are considered independent of
management and free from any business or other
relationships that could materially interfere with
the exercise of their independent judgement. The
criteria used by management to assess independ-
ence are in accordance with the criteria detailed
in Section A.3.1 of the Code.  The Board does not
consider Non-Executive Director shareholdings 
to impinge upon their independence. Indeed
such shareholdings not only ensure that the Non-
Executive Directors’ interests are aligned with
those of Shareholders, but are also in keeping with
the whole ethos of the MITIE Group. 
The Board also believes that, in his role as Non-
Executive Chairman, David C Ord continues to
remain independent in all his dealings with the
Executive Directors. The communication channel
between the Chairman and Executive Directors
not only serves to keep the Chairman abreast of
current business issues, but also provides the
Executive Directors with access to an independ-
ent opinion on day-to-day business decisions. 
In respect of the Chairman’s Board duties, his 
performance meets the requirements of the 
Higgs guidance on the role of the Non-Executive
Director. The Chairman is therefore considered by
the Board to be an Independent Non-Executive
Director and accordingly remains eligible to be 
a member of the Board Committees.
There is a clear division of responsibility between
the Chairman and Chief Executive. The Chairman
is responsible for running the Board thus ensuring,
amongst other things, that the Non-Executive
Directors contribute effectively, that there are
constructive relations between Executive and
Non-Executive Directors, and that the Board is
aware of communications with Shareholders. The
Chief Executive is responsible for the running of
the Group in accordance with the authority dele-
gated by the Board. This ensures that there is a
balance of power and authority such that no one
individual has unfettered powers of decision. 
The commitments outside the Group of the
Executive Directors are shown on page 23.  The
Board does not consider these additional respon-
sibilities to prejudice the Directors’ abilities to carry
out their duties effectively. Details of the remuner-
ation received from these commitments are
shown in the Remuneration Report on pages 26 
to 29. Within the Group, to ensure that undue
reliance is not placed on a particular Director or
Committee member, no individual Director is
Chairman of more than one Committee.
The Board had seven scheduled meetings during
the year, however, further meetings were held
outside of this schedule to deal with specific mat-
ters. During the year the Chairman also met with
the other Non-Executive Directors on several
occasions, usually prior to main Board meetings,
without the Executive Directors being present. 
There is a formal schedule of matters reserved for
the decision of the Board which has been reviewed
during the year in light of the requirements of the
Code and changing needs of the Group. Matters
detailed within this schedule include:
■ approval of strategy;
■ review and approval of budgets and business
plans and monitoring of operational perform-
ance against these;
■ review and approval of acquisitions and new
company start-ups;
30 MITIE Group PLC Annual Report 2005 ■ Operational performance;
■ Health and Safety; 
■ Finance; 
■ IT; 
■ Human Resources; 
■ Insurance; 
■ Property; 
■ Public Relations and Marketing; 
■ Risk Management and Internal Audit; and 
■ Strategic Projects and Corporate
Development. 
Its current members include the Executive
Directors of MITIE Group PLC. It is chaired by the
Chief Executive. 
Audit Committee
The Audit Committee comprises all four Non-
Executive Directors and is chaired by Cullum
McAlpine. The Board has satisfied itself that at
least one of the Committee members has recent
and relevant financial experience. 
Report of the Audit Committee 
The Committee met three times during the year to
examine and consider matters relating to the
affairs of the Group. These matters included:
■ review and examination of the Group’s Interim
Report and Annual Report and Accounts;
■ review and consideration of critical accounting
policies, significant judgements, and changes in
accounting policy (where applicable);
■ review and approval of the Internal Audit plan
for the year ending 31 March 2006;
■ receipt of the external Auditors’ audit plan 
and year-end summary memorandum;
■ review of the effectiveness of the external
Auditors;
■ consideration of the going concern assumption;
■ presentations from senior management
regarding matters identified during the Group’s
internal audit and risk management activities;
■ consideration of corporate governance mat-
ters arising under the Combined Code; and
■ consideration of the methodology and results
of the Internal Audit and Risk Management
Department.
The Committee is also responsible for considering
the fees, nature and scope of work and inde-
pendence and objectivity of the Group’s external
Auditors as well as their appointment, reappoint-
ment and removal as necessary. In respect of
auditor independence and objectivity, the exter-
nal Auditors and Group have regular dialogue
concerning such matters and a report is made to
the Audit Committee at least once a year. This
dialogue allows and assists the Committee to
■ review of the operation and effectiveness of
the internal control framework;
■ review of significant risks affecting the group;
■ review of compliance with corporate gover-
nance guidance; 
■ definition of formal lines of responsibility, 
delegation of authorities and authorisation 
limits; and
■ review and approval of succession plans for
the Board.
Further details of the schedule of matters reserved
for the Board are available from the Company
Secretary on request.
At least a week before each Board meeting,
each Director is supplied with an agenda and 
sufficient supporting papers that provide the
appropriate information required for the Directors
to properly discharge their duties. Included within
these papers is a summary of the Group’s overall
performance as well as detailed results for each
operating business. Other papers include a treas-
ury report detailing the cash position across the
Group and proposals regarding future potential
acquisitions, disposals, start-ups or restructurings.
The monthly financial results and analyses are 
circulated in months where no Board meeting 
is held. Minutes of all Committee meetings are 
circulated to Committee members and other
Directors as appropriate.
The Board regularly reviews the quality, nature
and presentation of information provided and
requests changes where the Directors feel such
changes will offer more appropriate information
to enable them to discharge their duties.
All Directors have access to the advice and services
of the Company Secretary who is responsible for
ensuring that Board procedures and applicable
rules and regulations are observed, including 
advising on all governance matters. The Company
Secretarial Department provides secretarial 
services to all Board Committees. If necessary the
Directors are able to seek independent profes-
sional advice at the Group’s expense.
Executive Committee
The Executive Committee meets on a regular
basis and met formally eight times during the year.
In addition to these meetings the Committee
members are in regular communication and met
on a number of other occasions.
The Committee is responsible for the overall day-
to-day management of the Group. Specifically,
the Committee receives reports which include the
following areas:  
Corporate Governance
MITIE Group PLC Annual Report 2005 31 consider the independence of the Auditors and
the related safeguards and procedures in Deloitte
& Touche LLP. 
On occasion, the external Auditors provide non-
audit services to the Group. Independence mat-
ters are given careful consideration prior to such
appointments, while additional controls are in
place within Deloitte & Touche LLP regarding the
segregation and nature of the services provided.
An analysis of the fees paid to the Auditors is given
in Note 2.
A further requirement of the Code is for the Audit
Committee to review the Group’s procedures for
employees to communicate concerns, in confi-
dence, about possible improprieties in matters 
of financial reporting or other matters. The
Committee should also ensure that there are
arrangements in place for the proportionate and
independent investigation of such matters and for
appropriate follow-up action. The Committee has
carried out its review and is aware that during the
year there were only various informal processes
and communication channels throughout the
Group to address such matters with the Internal
Audit function being well positioned to investigate
significant matters of impropriety should they
arise. Since the year-end more formalised ‘Whistle-
blowing’ procedures have been implemented. 
To help the Committee assess the effectiveness of
the Group’s internal audit and risk manage-
ment activities, reports are submitted to each
Committee meeting to update its members on
the activities of the Internal Audit and Risk
Management Department. Detailed presenta-
tions to the Committee are also made, on
request, by this department covering various
aspects of the system of internal control.
The Group’s external Auditors normally attend the
Audit Committee meetings on invitation and, at
the request of the Committee, the Group Finance
Director, other senior executives and Manager of
the Internal Audit and Risk Management
Department will also attend. The Committee 
has access to the external Auditors’ advice, and
that of other independent professional advisors,
without the presence of the Executive Directors 
if necessary.
Remuneration Committee
The Remuneration Committee comprises all four
independent Non-Executive Directors under the
chairmanship of Manish J Chande. The Committee
usually meets at least twice a year and met four
times during the year under review. The Committee
makes recommendations to the Board on the
Group’s framework of senior management and
executive remuneration and determines on the
Board’s behalf the specific remuneration pack-
ages for each of the Executive Directors. Advice is
sought from independent external remuneration
consultants as and when considered necessary. 
The Directors’ Remuneration Report on pages 26 to
29 includes details of the remuneration policy and
of the remuneration of the Directors.
Nomination Committee
The Nomination Committee comprises three inde-
pendent Non-Executive Directors and is chaired
by the Senior Independent Non-Executive Director
Sir John Jennings. The Committee is responsible for
monitoring the balance and composition of the
Board to ensure that it contains the necessary
skills, knowledge and experience to properly 
discharge its duties. The Committee also makes
recommendations to the Board on new Board
appointments, after considering the job specif-
ication and the candidate’s specific skills, experi-
ence and other commitments and any adjust-
ments to the Board’s balance and composition
considered necessary. During the year succession
planning was reviewed at Board level. 
The Committee usually meets at least once a year
with additional meetings taking place as and
when requested by any Committee member. The
Committee met once during the year under
review. 
The terms of reference of the Audit, Remuneration
and Nomination Committees are available on the
Group’s website (www.mitie.co.uk).
Meeting attendance
All Directors are encouraged to attend all meet-
ings of all the Committees of which they are mem-
bers and it is recognised by the Board that 
they make every effort to do so, rarely missing 
a meeting. Directors’ actual attendance at regular
Board and Committee meetings is shown in the
following table: 
Director Board Audit Remuneration Nomination
No. meetings  
held in year 7 3 4 1
D C Ord 7 3 4 1
I R Stewart 7 – – –
C S Acheson 6 – – –
N R Goodman 7 – – –
C S Hale 7 – – –
R McGregor-Smith 7 – – –
W Robson 6 – – –
M J Chande 5 3 4 1
Sir J Jennings 7 3 3 1
C McAlpine 7 3 4 –
32 MITIE Group PLC Annual Report 2005 continue to be reviewed and assessed with a
view to formalising the process further over the
forthcoming year. 
Those Directors due for re-election at the next
Annual General Meeting are shown in the
Directors’ Report on page 24. 
Shareholder communications
The Group is committed to maintaining an ongo-
ing relationship with institutional and private
Shareholders and welcomes such dialogue. The
Group recognises that Shareholders must receive
high-quality, relevant and useful information in a
timely manner. To facilitate this, formal presenta-
tions are made to institutional investors and ana-
lysts twice a year after the release of the Interim
Report and Annual Report and Accounts.
Meetings are also held with Shareholders on
request and usually satisfied by the Chief
Executive and Group Finance Director. The
Chairman has also met with a number of the
Group’s larger Shareholders during the year to dis-
cuss matters of Group strategy, performance and
values. Any significant matters arising in these
meetings are fed back to the Board as necessary
by the Chief Executive and/or the Chairman. 
Other Directors, including the Senior Independent
Non-Executive Director, attend the Group’s
Annual General Meeting and are available to
Shareholders at other times throughout the year if
Shareholders request additional meetings. The
Senior Independent Non-Executive Director is also
available if Shareholders have concerns that they
believe are not being addressed by the Executive
Directors or the Chairman. 
Principal channels of communication with
investors continue to be through news announce-
ments, the publication of the Interim Report and
Annual Report and Accounts, and the Group’s
website (www.mitie.co.uk). Both institutional and
private Shareholders are welcomed at the
Annual General Meeting. 
Internal control
The Directors are responsible for the Group’s sys-
tems of internal control, including financial, opera-
tional and compliance controls, and risk manage-
ment systems. The Directors are also responsible for
regularly reviewing the operation and effective-
ness of these systems which have been designed
to meet the Group’s particular needs and aim to
safeguard Group assets, ensure that proper
accounting records are maintained and that the
financial information used within the business and
for publication is reliable. Any such systems of inter-
nal control are designed to manage rather than
eliminate the risk of failure to achieve business
objectives. In pursuing these objectives, the 
Director appointment, rotation and appraisal
Each new Director receives papers that include a
copy of MITIE Group PLC’s Memorandum and
Articles of Association, Committee terms of refer-
ence, and copies of recent Board minutes and
supporting papers. New Directors are formally
introduced to the Board as a whole and invited to
visit any number of sites and operations to help
familiarise themselves with the Group’s business. 
Any Director, on appointment and throughout
their service, is entitled to receive any training they
consider necessary to enable them to fulfil their
responsibilities effectively and to update their skills
and knowledge. This is at the Group’s expense. 
All Directors are appointed by the Board as a
whole on the recommendation of the Nomination
Committee. All new Directors are subject to 
re-election by the Shareholders at the first Annual
General Meeting after their appointment. All
Directors have also been reappointed within a
three year period, although currently the Articles of
Association only require one third of the Board to
be re-elected each year. The Directors are there-
fore proposing to recommend to Shareholders at
the forthcoming Annual General Meeting amend-
ments which will require all Directors to be re-elect-
ed at least every three years. 
None of the Executive or Non-Executive Directors
has a service contract with a notice period greater
than twelve months. The Executive Directors’ serv-
ice contracts and Non-Executive Directors’ fixed-
term agreements are available for inspection at
the Company’s Registered Office, the Head
Office, and at the Annual General Meeting.
Executive Director performance is assessed
against agreed targets as a part of the
Remuneration Committee review process, while
meetings between individual Executive Directors
and the Chief Executive also take place, the
results of which are discussed with the Chairman.
The performance of the Non-Executive Directors
has been carried out through various informal
processes, including discussion between the
Chairman and Chief Executive, while the Non-
Executive Directors were responsible for consider-
ing the performance of the Chairman. During the
year the Chairman and Nomination Committee
also approved and enhanced an annual Board
and Committee evaluation process to assess the
performance of the Board and its Committees for
the year ended 31 March 2005. A series of tailored
questionnaires is therefore being developed to
facilitate this. The results of this process will be
reviewed by the Chairman and Chief Executive
and discussed with the Board. The processes cur-
rently used to monitor the performance of the
Board, its Committees and individual members will
MITIE Group PLC Annual Report 2005
Corporate Governance continued
33 systems of internal control can only provide rea-
sonable, and not absolute, assurance against 
material mis-statement and loss.
The Board confirms that there is a continuing
process for identifying, evaluating, and managing
significant risks faced by the Group, which is in line
with the current Turnbull guidance. The Board also
confirms that this process has been in place for
the year under review and up to the date of
approval of the Annual Report and Accounts. 
A review of the operation and effectiveness of the
internal control framework has also been under-
taken, this being an annual process. Key elements
of the process used by the Board to review the
effectiveness of the systems of internal control
include reviews of significant issues arising from
internal and external audits, a review of the signifi-
cant risks reported in the Group risk register, and
discussions with senior management. The review
process adopted by the Board also includes con-
sideration of the following key features of the sys-
tems of internal control.
MITIE Group culture and management 
framework
The MITIE Group PLC Board emphasises a culture
of integrity, competence, fairness and responsibil-
ity through its statements and actions. The Board
sets the framework within which this culture flows
down through the organisation to the operating
businesses and individual trading businesses who
operate their own systems of internal control. 
In addition to this framework, the Group Head
Office offers specialist resource support. The team
of specialists providing this support has been
enhanced during the year to help develop and
strengthen the Group’s overall risk management
activities, while ensuring that mitigation strategies
and actions are timely and effective. 
Information systems
There is a system of reporting key performance
and risk related information to the Board, includ-
ing a review of the operating result against budget
and of the consolidated Group risk register. Key
operational performance indicators are also con-
tinuously monitored by the Executive Directors
and senior management as described in the
Executive Committee section of this statement. 
Individual company controls
Each operating company has authority to man-
age their business within delegated levels of
authority. Group procedures and controls are
supplemented by business operating standards to
ensure that specific business factors are dealt with
in these companies effectively. The Board of each
operating company is also required to complete
an annual Statement of Internal Control which
requires that Board to consider formally its own
systems of internal control with specific reference
to areas of judgement, compliance with regula-
tory and Group requirements, the accuracy of its
financial information and risks to its operations.  
Risk management 
Each operating business regularly reviews its risk
profile using a common strategic risk framework.
These frameworks include warning mechanisms
and any further action necessary to reduce the
risks. On a regular basis the operating companies
refine each framework in light of the changing
aspects of their businesses, the consolidated
results being included in the Group Risk Register
which is monitored by the MITIE Group PLC Board. 
The Internal Audit and Risk Management
Department also undertakes an annual review
programme which considers both the internal
control environment, key areas of risk to the Group
and risk management systems. The department’s
recommendations and conclusions are forwarded
to the relevant level of management, the
Executive Committee and the Audit Committee
for their consideration. Where deemed appro-
priate, the Audit Committee will invite relevant
management to the Audit Committee meetings
to address the issues identified during the reviews. 
The activities and methodology of this depart-
ment currently follow the Turnbull guidance. These
processes are however being reviewed to ensure
that they remain in line with best practice. Due
regard will also be given to the pending revision of
the Turnbull guidance.
In addition to these features of the current system
of internal control, the Board continues to take
steps to embed internal control and risk manage-
ment processes further into the operations of the
Group and to deal with areas of improvement
that come to the Board’s and management’s
attention. 
Compliance with the Combined Code
The Board confirms that throughout the year
ended 31 March 2005, the Group has complied
with the provisions set out in Section 1 of the
Combined Code on Corporate Governance
issued by the Financial Reporting Council in July
2003, with the exception that at least half the
Board has not consisted of Independent Non-
Executive Directors during the year. ■
34 MITIE Group PLC Annual Report 2005 the Financial Services Authority and we report if it
does not. We are not required to consider whether
the Board’s statements on internal control cover all
risks and controls, or form an opinion on the effec-
tiveness of the Group’s corporate governance 
procedures or its risk and control procedures. 
We read the Directors’ Report and the other infor-
mation contained in the Annual Report for the
above year as described in the contents section
including the unaudited part of the Directors’
Remuneration Report and consider the implica-
tions for our Report if we become aware of any
apparent mis-statements or material inconsisten-
cies with the financial statements.
Basis of audit opinion
We conducted our audit in accordance with
United Kingdom auditing standards issued by the
Auditing Practices Board. An audit includes exam-
ination, on a test basis, of evidence relevant 
to the amounts and disclosures in the financial
statements and that part of the Directors’
Remuneration Report described as having been
audited. It also includes an assessment of the 
significant estimates and judgements made by
the Directors in the preparation of the financial
statements and of whether the accounting poli-
cies are appropriate to the circumstances of the
Company and the Group, consistently applied
and adequately disclosed.
We planned and performed our audit so as to
obtain all the information and explanations which
we considered necessary in order to provide us
with sufficient evidence to give reasonable assur-
ance that the financial statements and the part of
the Directors’ Remuneration Report described 
as having been audited are free from material
mis-statement, whether caused by fraud or other
irregularity or error. In forming our opinion, we also
evaluated the overall adequacy of the presenta-
tion of information in the financial statements and
the part of the Directors’ Remuneration Report
described as having been audited.
Opinion
In our opinion:
■ The financial statements give a true and fair
view of the state of affairs of the Company and
the Group as at 31 March 2005 and of the prof-
it of the Group for the year then ended; and
■ The financial statements and that part of the
Directors’ Remuneration Report described as
audited have been properly prepared in
accordance with the Companies Act 1985.
Deloitte & Touche LLP
Chartered Accountants and Registered Auditors 
Bristol, United Kingdom
20 May 2005
We have audited the financial statements of MITIE
Group PLC for the year ended 31 March 2005
which comprise the Group Profit and Loss
Account, the Balance Sheets, the Group Cash
Flow Statement, the Note of Historical Cost Profits
and Losses, the Reconciliation of Movements in
Shareholders’ Funds and the related Notes 1 to 28
together with the Statement of Accounting
Policies.  These financial statements have been
prepared under the accounting policies set out
therein.  We have also audited the information in
the part of the Directors’ Remuneration Report
that is described as having been audited.
This Report is made solely to the Company’s mem-
bers, as a body, in accordance with section 235 of
the Companies Act 1985.  Our audit work has been
undertaken so that we might state to the
Company’s members those matters we are
required to state to them in an Auditors’ Report and
for no other purpose.  To the fullest extent permitted
by law, we do not accept or assume responsibility
to anyone other than the Company and the
Company’s members as a body, for our audit work,
for this Report, or for the opinions we have formed.
Respective responsibilities of Directors 
and Auditors
As described in the Statement of Directors’
Responsibilities, the Company’s Directors are
responsible for the preparation of the financial
statements in accordance with applicable United
Kingdom law and accounting standards. They are
also responsible for the preparation of the other
information contained in the Annual Report 
including the Directors’ Remuneration Report. Our
responsibility is to audit the financial statements
and the part of the Directors’ Remuneration Report
described as having been audited in accordance
with relevant United Kingdom legal and regulatory
requirements and auditing standards.
We report to you our opinion as to whether the
financial statements give a true and fair view and
whether the financial statements and part of the
Directors’ Remuneration Report described as hav-
ing been audited have been properly prepared
in accordance with the Companies Act 1985. We
also report to you if, in our opinion, the Directors’
Remuneration Report is not consistent with the
financial statements, if the Company has not kept
proper accounting records, if we have not
received all the information and explanations we
require for our audit, or if information specified 
by law regarding Directors’ remuneration and
transactions with the Company and other mem-
bers of the Group is not disclosed.
We review whether the Corporate Governance
Statement reflects the Company’s compliance
with the nine provisions of the FRC 2003 Combined
Code specified for our review by the Listing Rules of
MITIE Group PLC Annual Report 2005
Independent Auditors’ Report to the Members of MITIE Group PLC
35 36 MITIE Group PLC Annual Report 2005
Group Profit and Loss Account 
for the year ended 31 March 2005
2005 2004
Note £’000 £’000
Turnover 1
– Continuing operations 799,737 664,259
– Discontinued operations 18,892 30,254
818,629 694,513
Cost of sales 1 (651,503) (543,880)
Gross profit 1 167,126 150,633
Administrative expenses 1 (125,160) (114,149)
Administrative expenses
– before amortisation of goodwill (122,335) (111,986)
Operating profit before goodwill amortisation 44,791 38,647
– amortisation of goodwill (2,825) (2,163)
Operating Profit 2
– Continuing operations 40,918 35,355
– Discontinued operations 1,048 1,129
41,966 36,484
Loss on sale excluding unamortised goodwill (3,366) –
Goodwill not previously amortised (1,238) –
Goodwill previously written off to reserves (5,013) –
Exceptional loss on sale of discontinued operations 20b (9,617) –
Exceptional profit on sale of tangible fixed assets from continuing operations 9 1,471 –
Profit on ordinary activities before interest 33,820 36,484
Interest 4 2,117 1,696
Profit on ordinary activities before tax 35,937 38,180
Tax on profit on ordinary activities 5 (14,315) (12,293)
Profit on ordinary activities after tax 21,622 25,887
Minority interests (3,174) (2,533)
Profit for the year 18,448 23,354
Dividends - equity 6 (10,196) (7,884)
Retained profit for the year 18 8,252 15,470
Earnings per ordinary share 7
– Basic 6.0p 7.6p
– Diluted 5.9p 7.6p
– Basic before goodwill amortisation 6.9p 8.3p
– Basic before goodwill amortisation and exceptional items 9.6p 8.3p
There are no recognised gains and losses for the current financial year 
or preceding financial year other than as stated in the Group Profit and Loss Account.
Profit on ordinary activities before tax and goodwill and exceptional items 46,908 40,343 Accounts for the Year Ended 31 March 2005
MITIE Group PLC Annual Report 2005
Reconciliation of Movements in Shareholders’ Funds 
for the year ended 31 March 2005
2005 2004
£’000 £’000
Profit for the financial year 18,448 23,354
Dividends (10,196) (7,884)
8,252 15,470
Goodwill previously written off included in retained profit for the year 5,013 –
Shares issued
– in respect of minority interests acquired 3,296 8,128
– own shares acquired (15,015) –
– other 1,368 735
Net addition to Shareholders’ funds 2,914 24,333
Shareholders’ funds at the beginning of the year 129,233 104,900
Shareholders’ funds at the end of the year 132,147 129,233
37
Note of Historical Cost Profits and Losses 
for the year ended 31 March 2005
2005 2004
£’000 £’000
Profit on ordinary activities before tax 35,937 38,180
Difference between the historical cost depreciation charge on revalued assets 
and the actual depreciation charge for the year calculated on the revalued amount 10 76
Realisation of property revaluation losses/(gains) of previous years 179 (8)
Historical cost profits on ordinary activities before tax,
minority interests and dividends 36,126 38,248
Historical cost profits for the year retained after tax,
minority interests and dividends 8,441 15,538 38 MITIE Group PLC Annual Report 2005
Group Balance Sheet  
as at 31 March 2005
2005 2004
Note £’000 £’000
Fixed Assets
Intangible assets 8 49,908 51,937
Tangible assets 9 27,214 40,329
77,122 92,266
Current Assets
Work in progress and stocks 10 6,343 7,055
Debtors 11 179,947 151,868
Investments 12 3,827 2,391
Cash at bank and in hand 57,667 47,165
247,784 208,479
Creditors – due within one year 13 (173,102) (157,370)
Net Current Assets 74,682 51,109
Total Assets less Current Liabilities 151,804 143,375
Creditors – due after one year 14 (776) (136)
Provisions for Liabilities and Charges 16 (9,241) (7,390)
Net Assets 141,787 135,849
Capital and Reserves
Called up share capital 17 7,580 7,736
Share premium account 18 11,577 9,836
Merger reserve 18 44,128 40,895
Capital redemption reserve 18 257 –
Revaluation reserve 18 (251) (440)
Other reserve 18 583 994
Profit and loss account 18 68,273 70,212
Equity Shareholders’ funds 132,147 129,233
Equity minority interest 9,640 6,616
141,787 135,849
The financial statements were approved by the Board of Directors on 20 May 2005.
Signed on behalf of the Board of Directors.
Ian R Stewart Chief Executive
Ruby McGregor-Smith Group Finance Director Accounts for the Year Ended 31 March 2005 continued
MITIE Group PLC Annual Report 2005 39
Company Balance Sheet  
as at 31 March 2005
2005 2004
Note £’000 £’000
Fixed Assets
Tangible assets 9 1,215 910
Investments in subsidiary undertakings 25 108,273 110,019
109,488 110,929
Current Assets
Debtors 11 40,012 39,864
Cash at bank and in hand 5,477 939
45,489 40,803
Creditors – due within one year 13 (27,690) (30,051)
Net Current Assets 17,799 10,752
Net Assets 127,287 121,681
Capital and Reserves
Called up share capital 17 7,580 7,736
Share premium account 18 11,577 9,836
Merger reserve 18 44,128 40,895
Capital redemption reserve 18 257 –
Profit and loss account 18 63,745 63,214 
Equity Shareholders’Funds 127,287 121,681
The financial statements were approved by the Board of Directors on 20 May 2005.
Signed on behalf of the Board of Directors.
Ian R Stewart Chief Executive
Ruby McGregor-Smith Group Finance Director 40 MITIE Group PLC Annual Report 2005
Group Cash Flow Statement 
for the year ended 31 March 2005
2005 2004
Note £’000 £’000
Net cash inflow from operating activities 19 46,890 43,854
Returns on investments and servicing of finance
Interest received 2,125 1,693
Interest paid – (39)
Interest element of finance lease rentals (47) (26)
Minority dividends paid (125) –
1,953 1,628
Tax
UK corporation tax paid (13,523) (12,352)
(13,523) (12,352)
Capital expenditure
Payments to acquire tangible fixed assets (14,004) (17,267)
Receipts from sales of tangible fixed assets 3,160 4,603
(10,844) (12,664)
Acquisitions and disposals 20
Payments to acquire subsidiary undertakings (205) (22,526)
Net overdraft acquired with subsidiary undertakings – (1,163)
Sale of subsidiary undertakings 8,935 –
8,730 (23,689)
Equity dividends paid (9,104) (6,825)
Cash inflow/(outflow) before management of liquid resources and financing 24,102 (10,048)
Management of liquid resources
Net  increase/(decrease) in investments (1,436) 1,489
Financing
Issue of Ordinary Share capital 3,013 967
Purchase of own shares (14,912) –
Net capital element of finance lease rentals (265) (203)
(12,164) 764
Increase/(decrease) in cash in the year 22 10,502 (7,795) Accounts for the Year Ended 31 March 2005
MITIE Group PLC Annual Report 2005 41
Financial instruments
The Group uses derivative financial instruments to
reduce exposure to foreign exchange risk. The
Group does not hold or issue derivative financial
instruments for speculative purposes. 
For a forward foreign exchange contract to be
treated as a hedge, the instrument must be relat-
ed to actual foreign currency assets or liabilities 
or to a probable commitment. It must involve 
the same currency or similar currencies as the
hedged item and must also reduce the risk of for-
eign currency exchange movements on the
Group’s operations. Gains and losses arising on
these contracts are deferred and recognised in
the profit and loss account, or as adjustments to
the carrying amount of fixed assets, only when the
hedged transaction has itself been reflected in
the Group’s financial statements. 
If an instrument ceases to be accounted for as 
a hedge, for example because the underlying
hedged position is eliminated, the instrument is
marked to market and any resulting profit or loss
recognised at that time.
Foreign currency
Transactions in foreign currencies are recorded at
the rate of exchange at the date of the transac-
tion or, if hedged, at the forward contract rate.
Monetary assets and liabilities denominated in 
foreign currencies at the Balance Sheet date are
reported at the rates of exchange prevailing 
at that date or, if appropriate, at the forward 
contract rate.
Investments
Shares in Group companies are stated at cost less
provision for impairment in value. Current asset
investments are stated at the lower of cost and
net realisable value.
Leased assets
Assets acquired under finance leases are includ-
ed in tangible fixed assets and depreciated in
accordance with the above policy. Outstanding
future lease obligations are shown in creditors. 
The finance element of the rental payments is
charged to the Profit and Loss Account over the
period of the lease. Operating lease rentals are
charged to the Profit and Loss Account in equal
instalments over the lease term. 
Accounting Policies
31 March 2005
Accounting convention
The financial statements have been prepared
under the historical cost convention as modified
by the revaluation of certain freehold and long
leasehold properties. The financial statements
have been prepared in accordance with appli-
cable United Kingdom accounting standards.  
Basis of consolidation
The consolidated Profit and Loss Account and
Balance Sheet include the financial statements of
MITIE Group PLC and all its subsidiary undertakings.
The results of the subsidiary undertakings acquired
or sold are included from or up to the effective
date of acquisition or sale. 
Accounting developments 
There have been no new UK accounting standards
adopted during the year ended 31 March 2005.
Goodwill and intangible fixed assets
Goodwill is calculated as the surplus of fair value
of purchase consideration over fair value attrib-
uted to the net assets of subsidiary undertakings
acquired. Following the introduction of FRS 10,
goodwill in respect of acquisitions made after the
financial year ended 31 March 1998 has been
capitalised and amortised over its estimated 
useful economic life of up to 20 years. 
For acquisitions made before 1 April 1998, good-
will was written off directly to reserves. In the event
of a disposal of the businesses concerned, this
goodwill will be included in determining the gain
or loss on disposal in the Profit and Loss Account.
Tangible fixed assets 
Tangible fixed assets are stated at cost or valua-
tion, less depreciation and any provision for impair-
ment. Depreciation is provided on tangible fixed
assets on a straight-line basis over the expected
useful lives. No depreciation is provided on land.
The expected useful lives are as follows:
Freehold and long leasehold buildings 50 years
Plant 3-14 years
V ehicles 4 years  42 MITIE Group PLC Annual Report 2005
Profit is recognised on long-term contracts, if the
final outcome can be assessed with reasonable
certainty, by including in the Profit and Loss
Account turnover and related costs as contract
activity progresses. 
Turnover from bundled contracts consists of vari-
ous components which operate independently of
each other and for which reliable fair values can
be established. Accordingly, each component is
accounted for separately as if it were an individual
contractual arrangement.
Pensions
The Group operates two defined benefit pension
schemes. The contributions charged to operating
profit are calculated by a qualified actuary 
so as to spread the cost of the pensions over 
the employees working lives with the Group. The
Group also operates a fully insured defined contri-
bution pension scheme, the assets of which are
held in independently administered funds. In
respect of this scheme, the pension cost charge
represents contributions payable by the Group in
the year. 
The Group has continued to account for pensions
in accordance with SSAP 24 as stated above. In
November 2000 the Accounting Standards Board
(ASB) issued FRS 17 ‘Retirement Benefits’, replac-
ing SSAP 24 ‘Accounting for Pension Costs’. In
November 2002 an amendment to FRS 17 was
published, which allowed an extension to the
transitional arrangements of FRS 17. The Group is
continuing to follow the transitional arrangements
under FRS 17. 
Provisions
Provision is made for outstanding insurance claims
incurred at the Balance Sheet date. Provision is
made for contingent consideration based on the
best estimate of what the Directors believe will
become payable in the future. ■
Work in progress and stocks
Stocks are valued at the lower of cost and net
realisable value. 
Costs represent materials, direct labour and over-
heads. Net realisable value is based on estimated
selling price, less further costs expected to be
incurred to completion and disposal. Provision is
made for obsolete, slow moving or defective
items where appropriate. 
Amounts recoverable on long-term contracts,
which are included in debtors, are stated at the
net sales value of the work done, less amounts
received as progress payments on account.
Excess progress payments are included in credi-
tors as payments on account. Cumulative costs
incurred net of amounts transferred to cost of
sales, less provision for contingencies and antici-
pated future losses on contracts, are included as
long-term contract balances in stock.
All bid costs are expensed as incurred until the
stage is reached where it is virtually certain that
the contract has been awarded.
Tax
Current tax is provided at amounts expected to
be paid (or recovered) using the tax rates and
laws that have been enacted or substantially
enacted at the Balance Sheet date.
Deferred tax is provided in full on timing differences
that result in an obligation at the Balance Sheet
date to pay more tax, or a right to pay less tax, at a
future date, at rates expected to apply when they
crystallise based on current tax rates and law.
Timing differences arise from the inclusion of items
of income and expenditure in tax computations in
periods different from those in which they are
included in the financial statements. Deferred tax
is not provided on timing differences arising from
the revaluation of fixed assets where there is no
commitment to sell the asset, or on unremitted
earnings of subsidiaries and associates where
there is no commitment to remit these earnings.
Deferred tax assets are recognised to the extent
that it is regarded as more likely than not that they
will be recovered. Deferred tax assets and liabilities
are not discounted.
Turnover
Turnover represents the total amount, excluding
sales taxes, receivable in respect of goods and
services supplied and contract work completed in
the year. Intra-Group transactions are excluded.
All turnover arose within the United Kingdom. Notes to the Accounts for the Year Ended 31 March 2005
MITIE Group PLC Annual Report 2005
1 Segmental analysis 
The business operates in the two segments as shown below:
Profit before
tax, goodwill Profit before Profit before Profit before
integration Integration tax & tax & goodwill interest, tax &
Turnover costs costs goodwill margin goodwill Pre-tax profit Net assets
Activity £’000 £’000 £’000 £’000 % £’000 £’000 £’000
2005
Support Services 440,288 29,746 – 29,746 6.8 28,769 27,816 48,283
Building Services 378,341 17,162 – 17,162 4.5 16,022 8,121 33,020
818,629 46,908 – 46,908 5.7 44,791 35,937 81,303
Net funds 60,484
Total 141,787
2004
Support Services 347,831 25,504 (1,031) 24,473 7.0 23,871 23,148 41,179
Building Services 346,682 15,870 – 15,870 4.6 14,776 15,032 45,359
694,513 41,374 (1,031) 40,343 5.8 38,647 38,180 86,538
Net funds 49,311
Total 135,849
Included in the Building Services segment in 2005 are amounts that relate to discontinued activities. 
These include turnover of £18,892,000 (2004: £30,254,000) and pre-tax profit of £917,000 (2004: £883,000).
Turnover from each division can be further analysed as follows:
2005 2005 2004 2004
Continuing Discontinued 2005 Continuing Discontinued 2004
activities operations Total activities operations Total
Turnover £’000 £’000 £’000 £’000 £’000 £’000
Support Services
Cleaning 189,689 – 189,689 151,696 – 151,696
Catering 13,509 – 13,509 10,677 – 10,677
Landscape 1,989 – 1,989 1,257 – 1,257
Pest Control 4,474 – 4,474 3,268 – 3,268
Security 54,147 – 54,147 35,017 – 35,017
Managed Services 102,822 – 102,822 82,870 – 82,870
Engineering Maintenance 73,658 – 73,658 63,046 – 63,046
Total 440,288 – 440,288 347,831 – 347,831
Building Services
Engineering Services 230,365 – 230,365 188,810 – 188,810
Property Services 129,084 – 129,084 127,618 – 127,618
Generation – 18,892 18,892 – 30,254 30,254
Total 359,449 18,892 378,341 316,428 30,254 346,682
Total Group 799,737 18,892 818,629 664,259 30,254 694,513
2005 2005 2004 2004
Continuing Discontinued 2005 Continuing Discontinued 2004
activities operations Total activities operations Total
Operating profit £’000 £’000 £’000 £’000 £’000 £’000
Turnover 799,737 18,892 818,629 664,259 30,254 694,513
Cost of sales (638,895) (12,608) (651,503) (523,884) (19,996) (543,880)
Gross profit 160,842 6,284 167,126 140,375 10,258 150,633
Administrative expenses (119,924) (5,236) (125,160) (105,020) (9,129) (114,149)
Operating profit 40,918 1,048 41,966 35,355 1,129 36,484
Discontinued operations relate to the disposal of MITIE Generation Ltd on 30 September 2004.
43 44 MITIE Group PLC Annual Report 2005
2 Operating profit
2005 2004
£’000 £’000
This is stated after charging/(crediting):
Depreciation and other amounts written off tangible fixed assets:
– owned assets 10,447 11,802
– leased assets 283 133
Goodwill amortisation 2,825 2,163
Auditors’ remuneration
– Group 254 194
– Company 25 25
– other services 36 90
Operating lease rentals
– plant and vehicles 1,653 1,082
– other 2,767 2,024
Profit on disposal of fixed assets (233) (884)
A more detailed analysis of amounts paid to the Auditors is provided below:
2005 2005 2004 2004
£’000 % £’000 %
Auditors’ remuneration 
– services as Auditors 279 89 219 65
– further assurance services (i) –– 28 8
– tax advisory services 32 10 86 26
– other non-audit services 41 41
315 100 337 100
(i) In 2004, £28,000 of fees were incurred on acquisitions. Fees in the prior year were included within the cost of investment, 
and not charged against operating profit.
3 Directors and employees
2005 2004
£’000 £’000
(i) Employment costs
Wages and salaries 332,739 282,521
Social security costs 27,190 21,772
Other pension costs 4,253 4,514
364,182 308,807
2005 2004
No. No.
(ii) The average number of persons employed during the financial year was:
Site 27,830 26,667
Administration 2,546 2,360
30,376 29,027
(iii) Details of Directors’ remuneration and interests are provided on pages 26 to 29 and the audited section should be regarded 
as an integral part of this Note.
4 Interest
2005 2004
£’000 £’000
(i) Interest payable and similar charges
Finance leases (47) (26)
Other – (39)
(ii) Interest receivable and similar income
Bank interest 2,071 1,761
Other 93 –
2,117 1,696 Notes to the Accounts for the Year Ended 31 March 2005 continued
MITIE Group PLC Annual Report 2005
5 Tax on profit on ordinary activities
a. Analysis of charge in the year
2005 2004
£’000 £’000
UK corporation tax 15,200 13,326
Adjustment in respect of prior years (505) (295)
Total current tax charge for the year (Note 5b) 14,695 13,031
Deferred taxation:
Timing differences – origination and reversal (239) (690)
Adjustments in respect of prior years – deferred tax (141) (48)
Tax on profit on ordinary activities 14,315 12,293
b. Factors affecting tax charge in the year
The tax assessed for the year is different from that resulting from applying the standard rate of corporation tax in the UK of 30% 
(2004: 30%). The differences are set out below.
2005 2004
£’000 £’000
Profit on ordinary activities before tax 35,937 38,180
Tax at 30% thereon 10,781 11,454
Expenses not deductible for tax purposes 379 432
Capital allowances less than/(in excess of) depreciation 236 (34)
Tax losses not utilised/(utilised) 458 (34)
Group relief not paid for – (16)
Movement in short-term timing differences – 650
Profit on disposal of property (453) –
Loss on disposal of investment 2,885 –
Goodwill 848 650
Prior periods (505) (295)
Other 66 224
Total current tax charge for the year (Note 5a) 14,695 13,031
The tax effect of the exceptional items is given in Notes 9 and 20b.
c. Factors affecting future tax charges
The Group is not aware of any factors that may materially affect the future tax charge.
6 Dividends
2005 2004
£’000 £’000
Interim dividend 1.6p per 2.5p share 4,885 3,327
(2004: 1.1p per 2.5p share)
Proposed final dividend 1.8p per 2.5p share 5,457 4,429
(2004: 1.4p per 2.5p share)
Minorities – 128
Adjustments in respect of prior years (146) –
10,196 7,884
Total dividend per 2.5p share for the year 3.4p 2.5p
Subject to approval at the Annual General Meeting, the final dividend will be paid on 30 September 2005 to members on the 
Register on 2 September 2005.
45 46 MITIE Group PLC Annual Report 2005
7 Earnings per ordinary share
The calculation of earnings per 2.5p share for 2005 and 2004 is based on the profit after tax and minority interest.
The weighted average number of shares for this purpose is 306,437,906 (2004: 305,665,870). The diluted earnings per share has been
calculated on the basic earnings and the weighted average number of shares plus 4,074,637 (2004: 1,040,263) shares representing
the weighted average number of shares under option during the year.
Headline earnings per share continues to have widespread acceptance and has been calculated in accordance with the definition 
in the UK Society of Investment Professionals statement of investment practice No.1, ‘The Definition of Headline Earnings’, as follows:
2005 2004
Basic earnings per Ordinary Share 6.0p 7.6p
Amortisation of goodwill 0.9p 0.7p
Earnings per Ordinary Share before goodwill 6.9p 8.3p
Exceptional items
– loss on sale of discontinued operations 3.1p –
– profit on sale of tangible fixed assets (0.4p) –
Total exceptional items 2.7p –
Earnings per Ordinary Share before goodwill and exceptional items 9.6p 8.3p
8 Fixed assets – Intangible
Goodwill
Group £’000
Cost
At beginning of year 56,188
Additions (see Note 20a) 2,034
Disposals (see Note 20b) (1,406)
At end of year 56,816
Amortisation
At beginning of year 4,251
Amortised in year 2,825
Disposals (see Note 20b) (168)
At end of year 6,908
Net book value
At end of year 49,908
At beginning of year 51,937
9 Fixed assets – Tangible 
Long
Freehold leasehold Plant and
properties properties vehicles Total
Group £’000 £’000 £’000 £’000
Cost or valuation
At beginning of year 5,792 3,166 65,028 73,986
Additions at cost - 87 14,954 15,041
Disposals (1,092) - (10,357) (11,449)
Subsidiaries disposed (see Note 20b) - - (25,379) (25,379)
At end of year 4,700 3,253 44,246 52,199
Cost 2,356 2,833 44,246 49,435
V aluation 1995 2,344 420 – 2,764
Depreciation
At beginning of year 610 285 32,762 33,657
Charge for year 77 121 10,532 10,730
Disposals (138) - (8,384) (8,522)
Subsidiaries disposed (see Note 20b) - - (10,880) (10,880)
At end of year 549 406 24,030 24,985
Net book value
At end of year 4,151 2,847 20,216 27,214
At beginning of year 5,182 2,881 32,266 40,329
Historic cost net book value
2005 4,320 2,954 20,216 27,490
2004 5,629 2,934 32,266 40,829 Notes to the Accounts for the Year Ended 31 March 2005 continued
MITIE Group PLC Annual Report 2005
9 Fixed assets – Tangible continued
No depreciation was charged against freehold or long leasehold buildings up to 1995. For the year ended 31 March 2005, 
the Profit and Loss Account has been charged with £198,000 (2004: £163,000) depreciation.
The historic cost of revalued properties was £3,301,000 (2004: £4,591,000). The net book value of plant and vehicles held under
finance leases included above was £954,000 (2004: £564,000).
Previous valuations were frozen, as allowed under the transitional provisions of FRS 15. The carrying value relating to the 
previous valuation performed as at 31 March 1995 has been carried forward in this year’s Financial Statements.
Included in freehold disposals is a property in Scotland, which resulted in an exceptional profit on sale of £1,471,000. 
The net tax effect of this profit on sale is £nil. 
Plant and 
vehicles
Company £’000
Cost
At beginning of year 2,612
Additions 736
Disposals (1,095)
Transfers to other Group companies (26)
At end of year 2,227
Depreciation
At beginning of year 1,702
Charge for the year 354
Disposals (1,037)
Transfers to other Group companies (7)
At end of year 1,012
Net book value
At end of year 1,215
At beginning of year 910
10 Work in progress and stocks
Group Company
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Work in progress 6,265 5,965 – –
Payments received on account (70) (2,811) – –
Goods for resale 148 3,901 – –
6,343 7,055 – –
11 Debtors
Group Company
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Trade debtors 156,718 136,899 47 63
Amounts recoverable under contracts 12,093 7,182 – –
Owed by subsidiary undertakings – – 35,511 38,884
Other debtors 5,594 3,119 2,588 198
Pre-payments and accrued income 4,076 4,668 870 315
Deferred tax 1,466 – – 404
Corporation tax – – 996 –
179,947 151,868 40,012 39,864
Included in Group and Company other debtors is the sum of £2,500,000 (2004: £nil) falling due after one year.
The deferred tax asset of £1,466,000 relates to negative capital allowances and other short-term timing differences. 
The Directors are of the opinion that suitable profits will be available in the periods in which these differences will reverse. 
The amount credited to the Profit and Loss Account in the year was £380,000 (2004: £735,000). The remaining movement 
in deferred tax in the year relates to the disposal of MITIE Generation Ltd.
47 48 MITIE Group PLC Annual Report 2005
12 Investments 
Group Company
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Unlisted investments 3,827 2,391 – –
Included in unlisted investments are deposits totalling £3,827,000 (2004: £2,391,000) held by the Group’s insurance subsidiary, 
which are not readily available for the general purposes of the Group.
13 Creditors - due within one year
Group Company
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Obligations under finance leases 241 109 – –
Payments received on account 785 205 – –
Trade creditors 97,271 87,411 568 72
Owed to subsidiary undertakings – – 15,688 18,925
Corporation tax 7,387 6,490 – –
Other taxes and social security 28,703 25,815 932 793
Other creditors 4,070 6,382 3,257 3,357
Accruals and deferred income 29,038 26,469 1,661 2,415
Proposed dividends 5,607 4,489 5,584 4,489
173,102 157,370 27,690 30,051
14 Creditors - due after one year
Group Company
2005 2004 2005 2004
£’000 £’000 £’000 £’000
Obligations under finance leases 776 136 – –
Finance leases are repayable between one and five years and are secured on the related leased assets.
15 Financial assets and liabilities
2005 2004
£’000 £’000
Maturity of borrowings
The maturity profile of the Group’s financial liabilities was as follows:
In one year or less, or on demand 241 109
In more than one year , but not more than two years 206 71
In more than two years, but not more than five years 570 65
1,017 245
Short-term debtors, current asset investments and creditors have been excluded from the analysis.
Cash at bank is held at normal commercial rates.
Borrowings
At the year-end, undrawn committed bank borrowing and overdraft facilities amounted to £60,000,000 (2004: £60,000,000), 
which are all renewable within one year.
Interest rates
At 31 March 2005, the Group had financial liabilities of £1,017,000 (2004: £310,000). These liabilities are under a fixed rate of interest 
of 6.4% until September 2009 when the liabilities will be fully re-paid.
At 31 March 2005, the Group had an interest bearing loan note of £2,500,000 (2004: £nil). This asset accrues interest at a rate 
of 1% over bank base rate.
Hedging
The Group’s policy is to use derivative instruments to hedge against any material exposure to movements in exchange rates, 
however , no such arrangements have been entered into during the course of the year. Gains and losses on instruments used for
hedging are not recognised until the exposure that is being hedged is itself recognised.
There are no unrecognised gains or losses at 31 March 2005 (2004: £nil).
Currency exposure
As at 31 March 2005, the Group had no currency exposure (2004: £nil). Notes to the Accounts for the Year Ended 31 March 2005 continued
MITIE Group PLC Annual Report 2005
15 Financial assets and liabilities continued
Fair values
The Directors consider that the fair value of financial assets and liabilities is not materially different from their book value.
Further information on financial instruments is given in the Finance Director’s Review.
16 Provision for liabilities and charges
Contingent Deferred Insurance
consideration tax reserve Total
£’000 £’000 £’000 £’000
Provisions
At beginning of year 3,200 90 4,100 7,390
Utilised during the year – (90) (907) (997)
Arising during the year – – 2,848 2,848
At end of year 3,200 – 6,041 9,241
Deferred tax in respect of the Group’s defined benefit schemes is disclosed in Note 26. During the year the deferred tax liability 
has reversed to a deferred tax asset of £1,466,000 (See Note 11).
The provision for insurance claims represents amounts payable by MITIE Reinsurance Company Ltd in respect of outstanding 
claims incurred at the Balance Sheet dates. These amounts will become payable as each year’s claims are settled.
Provision is made for contingent consideration, which will become payable in the future, at the best estimate of the Directors. 
Further details given in Note 23.
17 Called up share capital
Ordinary Ordinary
Shares of 2.5p Shares of 2.5p 
no. £’000
Authorised at 1 April 2004 and 31 March 2005 340,000,000 8,500
2005
Allotted and fully paid
At beginning of year 309,393,539 7,736
Issued as Directors’ remuneration 72,812 2
Issued for acquisitions 2,560,052 63
Issued under share option schemes 1,457,383 36
Own shares acquired (10,310,006) (257)
At end of year 303,173,780 7,580
2004
Allotted and fully paid
At beginning of year 302,186,614 7,556
Issued as Directors’ remuneration 87,959 2
Issued for acquisitions 6,608,203 165
Issued under share option schemes 510,763 13
At end of year 309,393,539 7,736
During the year 72,818 (2004: 87,959) Ordinary Shares of 2.5p were allotted as remuneration in respect of services provided 
by Directors at a market price of £1.62 (2004: £1.23) giving rise to share premium of £113,000 (2004: £106,000). 
During the year 2,560,052 (2004: 6,608,203) Ordinary Shares of 2.5p were allotted in respect of acquiring minority interests 
at a mid-market price of £1.29 (2004: £1.23) giving rise to a merger reserve of £3,232,000 (2004: £7,962,000).
During the year 1,457,383 (2004: 510,763) Ordinary Shares of 2.5p were allotted in respect of share option schemes 
at a price between £0.85 and £1.68 (2004: £1.02 and £1.35) giving rise to share premium of £1,628,000 (2004: £615,000).
During the year 10,310,006 (2004: nil) Ordinary Shares of 2.5p were purchased at market prices between £1.31 and £1.65. 
These were then cancelled. This resulted in a capital redemption reserve of £257,000 (2004: £nil).
49 50 MITIE Group PLC Annual Report 2005
17 Called up share capital continued
Options outstanding under the Savings Related Share Option Schemes at 31 March 2005 and 31 March 2004 were as follows:
Ordinary Shares Ordinary Shares
Option Date of 2.5p each of 2.5p each
price exercisable 2005 2004
85p 2004 34,538 907,592
150p 2005 748,616 881,924
125p 2006 667,062 802,926
110p 2007 1,357,667 1,703,619
120p 2008 1,458,142 1,792,604
120p 2009 1,961,689 –
6,227,714 6,088,665
Options outstanding under the Executive Share Option Schemes at 31 March 2005 and 31 March 2004 were as follows:
Ordinary Shares Ordinary Shares
Option Date of 2.5p each of 2.5p each
price exercisable 2005 2004
57.75p 2001 – 2008 375,000 692,669
95p 2002 – 2009 474,000 711,000
173.75p 2003 – 2010 469,600 587,600
145p 2004 - 2011 601,900 744,600
117p 2005 – 2012 864,600 1,027,600
99p 2006 – 2013 200,000 200,000
132p 2006 – 2013 1,433,150 1,520,850
127p 2007 – 2014 1,443,100 –
5,861,350 5,484,319
18 Share capital and reserves
Share Capital 
Called up premium Merger redemption Revaluation Other Profit and
share capital account reserve reserve reserve reserve (i) loss account Total
£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Group
At beginning of year 7,736 50,731 – – (440) 994 70,212 129,233
Reclassification – (40,895) 40,895 –––––
At beginning of year 
as restated 7,736 9,836 40,895 – (440) 994 70,212 129,233
Shares issued and 
premium arising in respect 
of acquisitions 63 – 3,233 –––– 3,296
Shares issued and 
premium arising in 
connection with 
exercise of share options 
and Directors’ remuneration 38 1,741 – – – (411) – 1,368
Retained profit for 
the financial year – - – – – – 8,252 8,252
Realisation of property 
revaluation losses on disposal – - – – 179 – (179) –
Additional depreciation 
on revalued assets – - – – 10 – (10) –
Own shares acquired (257) – – 257 – – (15,015) (15,015)
Goodwill previously 
written off included in 
retained profit for the year – - – – – – 5,013 5,013
Balance at end of year 7,580 11,577 44,128 257 (251) 583 68,273 132,147 Notes to the Accounts for the Year Ended 31 March 2005 continued
MITIE Group PLC Annual Report 2005
18 Share capital and reserves continued
Share Capital 
Called up premium Merger redemption Revaluation Other Profit and
share capital account reserve reserve reserve reserve (i) loss account Total
£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
Company
At beginning of year 7,736 50,731 – – – – 63,214 121,681
Reclassification – (40,895) 40,895 – – – – –
At beginning of year 
as restated 7,736 9,836 40,895 – – – 63,214 121,681
Shares issued and 
premium arising in respect 
of acquisitions 63 – 3,233 – – – – 3,296
Shares issued and 
premium arising in 
connection with 
exercise of share options 
and Directors’ remuneration 38 1,741 – – – – – 1,779
Retained profit for 
the financial year –––––– 15,546 15,546
Own shares acquired (257) – – 257 – – (15,015) (15,015)
Balance at end of year 7,580 11,577 44,128 257 – – 63,745 127,287
(i) Non-distributable
In accordance with the exemption allowed by Section 230(4) of the Companies Act 1985, the Company has not presented its own
Profit and Loss Account. The profit attributable to Shareholders in the Accounts of the Company was £25,888,000 (2004: £17,130,000).
Goodwill eliminated against reserves originating prior to the adoption of FRS 10 on 1 April 1998 amounted to £21,660,000 
(2004: £26,673,000).
Included in both the Company and the Group share premium accounts in previous years were amounts relating to premiums 
arising on shares issued subject to the provisions of Section 131 of the Companies Act 1985. These have now been separately 
reclassified into a separate merger reserve and the comparatives restated. This has had no impact on the results for the year.
19 Net cash inflow from operating activities
2005 2004
£’000 £’000
Operating profit 41,966 36,484
Depreciation 10,730 11,935
Amortisation of goodwill 2,825 2,163
Profit on sale of tangible fixed assets (233) (884)
Decrease/(increase) in work in progress and stocks 712 (1,369)
Increase in debtors (26,613) (39,754)
Increase in creditors and provisions 17,503 35,279
46,890 43,854
20a Purchase of subsidiary undertakings 
Acquisition of Minority Interests
MITIE
MITIE Air Engineering MITIE MITIE MITIE
Conditioning Services Roofing Security Greencote
(North) Ltd (Retail) Ltd Services Ltd (Scotland) Ltd Ltd Total
£’000 £’000 £’000 £’000 £’000 £’000
Minority interest 538 460 407 39 23 1,467
Goodwill 770 588 610 46 20 2,034
Total purchase consideration 1,308 1,048 1,017 85 43 3,501
Shares issued – MITIE Group PLC (1,235) (976) (977) (78) (30) (3,296)
Cash consideration being cash outflow in the period 73 72 40 7 13 205
MITIE Group PLC acquired these Minority Interests on 23 August 2004.
51 52 MITIE Group PLC Annual Report 2005
20b Disposal of subsidiary undertaking
MITIE Generation Ltd
On 30 September 2004, the Company sold its 100% interest in the ordinary share capital of MITIE Generation Ltd. The profit after 
taxation up to the date of disposal of this company was £643,000 and for the last financial year was £737,000.
The net assets disposed and the related sale proceeds were as follows:
2005
£’000
Tangible fixed assets 14,499
Net working capital 2,343
Overdraft (8,882)
Other loans (183)
Provisions for liabilities and charges (1,358)
Net assets 6,419
Goodwill not previously amortised 1,238
Goodwill previously written off to reserves 5,013
12,670
Loss on disposal (9,617)
Total consideration 3,053
Satisfied by:
– Loan notes 2,500
– Short term loan 500
– Cash 53
3,053
Net cash inflows from sale comprised:
Cash consideration 53
Overdraft disposed 8,882
Total cash effect 8,935
The short-term loan of £500,000 was settled on 31 March 2005.
The interest bearing loan notes of £2,500,000 are repayable in full by 1 April 2009.
As noted in the Profit and Loss Account, the total loss on disposal is £9,617,000. The tax effect of this loss is £nil.
21 Analysis of changes in net funds
At 31 March At 31 March
2004 Cashflows Non-cash Disposals 2005
£’000 £’000 £’000 £’000 £’000
Cash at bank and in hand 47,165 10,502 – – 57,667
Finance leases (245) – (1,037) 265 (1,017)
Current asset investments 2,391 1,436 – – 3,827
Net funds 49,311 11,938 (1,037) 265 60,477
22 Reconciliation of net cash flow to movement in net funds
2005 2004
£’000 £’000
Increase/(decrease) in cash in the year 10,502 (7,795)
Cash inflow/(outflow) from movement in debt and lease financing 265 (204)
Cash inflow/(outflow) from movement in liquid resources 1,436 (1,489)
Change in net debt resulting from cash flows 12,203 (9,488)
New finance leases (1,037) –
Movement in net funds in the year 11,166 (9,488)
Net funds at beginning of year 49,311 58,799
Net funds at end of year 60,477 49,311 Notes to the Accounts for the Year Ended 31 March 2005 continued
MITIE Group PLC Annual Report 2005
23 Contingencies
The Company is party with other Group companies to cross guarantees of each other’s bank overdraft.
The Company and various of its subsidiaries are, from time to time, parties to legal proceedings and claims that are in the 
ordinary course of business. The Directors do not anticipate that the outcome of these proceedings and claims, either individually 
or in aggregate, will have a material adverse effect on the Group’s financial position.
Included in provisions for liabilities and charges (Note 16) is £3,200,000 of contingent consideration relating to the acquisitions of
Trident Safeguards Ltd and Eagle Pest Control Services UK Ltd. For Trident Safeguards Ltd £2,000,000 is payable at any time between
2006 and 2010 if an agreed profit threshold is met. If this threshold is exceeded then an additional amount will become payable, 
with the total consideration capped at £20,000,000. In total £9,228,810 has been paid up to the 31 March 2005. For Eagle Pest Control
Services UK Ltd £1,200,000 is payable at any time between 2008 and 2013 if an agreed profit threshold is met. If this profit threshold is
exceeded then an additional amount will become payable, with the total consideration capped at £6,000,000. In total £2,800,000
has been paid up to the 31 March 2005.
Contingent consideration, to be satisfied in shares, for the acquisition of minority interests in subsidiary undertakings is dependent 
on future profits of those subsidiaries and is at the discretion of the Company. It is therefore not possible to quantify accurately, 
in advance, the final amounts that may become payable.
In connection with the sale of The Platform Company (UK) Ltd (formerly MITIE Powered Access Ltd), the Group has guaranteed lease
commitments amounting to £96,000 (2004: £1,049,000). These commitments reduce to £nil at the end of the next year. Against these
guarantees, the Group has received indemnities from the Group’s bankers of £17,000 (2004: £179,000) and from the suppliers of the
leased equipment of £21,000 (2004: £232,000), giving a net contingent liability of £58,000 (2004: £638,000).
In addition, the Group and subsidiaries have given indemnities in respect of performance guarantees amounting to £4,115,000 
(2004: £6,893,000) and import duty guarantees amounting to £nil (2004: £50,000) issued on its behalf in the ordinary course of business.
24 Commitments
2005 2004
£’000 £’000
Capital commitments as follows:
Contracted for but not provided for in the Accounts 859 –
2005 2005 2004 2004
Property Other Property Other
£’000 £’000 £’000 £’000
Annual commitments under operating leases that expire:
Within one year 370 322 263 241
In second to fifth years inclusive 1,179 1,746 1,427 389
Over five years 1,383 8 875 –
2,932 2,076 2,565 630
25 Investments in subsidiary undertakings
Shares at Provision for Net book
cost impairment value
£’000 £’000 £’000
At beginning of year 116,820 (6,801) 110,019
Additions 13,514 – 13,514
Disposals (10,459) – (10,459)
Impairment – (4,801) (4,801)
At end of year 119,875 (11,602) 108,273
The principal operating subsidiary undertakings are detailed in Note 28.
53 54 MITIE Group PLC Annual Report 2005
26 Pensions
In November 2000, the Accounting Standards Board (ASB) issued FRS 17 ‘Retirement Benefits’, replacing SSAP 24 ‘Accounting 
for Pension Costs’. In November 2002, an amendment to FRS 17 was published, which allowed an extension to the transitional
arrangements of FRS 17. The Group is following the transitional arrangements under FRS 17. 
(a) SSAP 24
The Group operates both defined benefit and defined contribution schemes. The pension charge for the defined contribution
schemes for the year is £896,000 (2004: £914,000).
The Group operates two defined benefit pension schemes called the MITIE Group PLC Pension Scheme and the MITIE Group PLC
Passport Pension Scheme. In addition, the Group contributes to the Executive Group Limited Shared Cost Section of the Railway
Pension Scheme. 
The assets of the MITIE schemes are held separately from the Group, being invested in equities and with insurance companies.
Contributions to the schemes are charged to the Profit and Loss Account so as to spread the cost of pensions over the employees’
working lives with the Group. The contributions are determined by a qualified actuary on the basis of triennial valuations using the 
projected unit credit method.
The assets of the Executive scheme are held in separate trustee-administered funds, and the assets and liabilities of the section can
be identified separately from those of other scheme sections. 
The pension charge for defined benefit schemes for the year was £3,357,000 (2004: £3,600,000).
MITIE Group PLC Pension Scheme
The most recent valuation was at 6 April 2002. It was assumed that:
Investment return – pre-retirement 7.00%
Investment return – post-retirement 5.50%
Salary increases 4.50%
Present and future pension increases 3.00%
The next actuarial valuation which was due as at 6 April 2005 is currently being prepared. The 2002 actuarial valuation showed 
that the market value of the assets was £24,401,000 and that the actuarial value of those assets represented 87% of the benefits 
that had accrued to members after allowing for expected future increases in earnings. The contributions of the Group and 
employees are 10% (2004: 10%) and 7.5% (2004: 7.5%) of pensionable earnings respectively.
MITIE Group PLC Passport Pension Scheme
The most recent valuation was at 6 April 2002. It was assumed that:
Investment return - pre-retirement 7.00%
Investment return - post-retirement 5.50%
Salary increases 4.50%
Present and future pension increases 3.00%
The next actuarial valuation which was due as at 6 April 2005 is currently being prepared. The 2002 actuarial valuation showed that
the market value of the assets was £581,000 and that the actuarial value of those assets represented 67% of the benefits that had
accrued to members after allowing for expected future increases in earnings. The contributions of the Group and employees total
32% (2004: 32%), with employees contributing between 1.5% and 6%.
Executive Group Limited Shared Cost Section (‘the Section’) of the Railway Pension Scheme
The Group operates a section of the Railway Pension Scheme (‘the Scheme’), a funded defined benefit pension scheme. 
However , there are no longer any employees accruing benefits in the Section. The assets of the Scheme are held in 
separate trustee-administered funds, and the assets and liabilities of the Section can be identified separately from those 
of other Scheme Sections.
No contributions are currently payable to the Section. In addition, no pension cost for the period has been incurred in respect 
of the Section, and there is no provision or pre-payment held.
The Scheme is subject to triennial valuation by independent actuaries. The last valuation was at 31 December 2003 and used the 
projected unit method, in which the actuarial liability makes allowances for projected earnings. The following were the principal
actuarial assumptions applied:
Investment returns 5.65% per annum
Pension increases 2.50% per annum
At the last actuarial valuation date, the value of the assets of the Section were £299,000 and, in the opinion of the actuary, 
this value was sufficient to cover 144% of the benefits that had accrued to members. Notes to the Accounts for the Year Ended 31 March 2005 continued
MITIE Group PLC Annual Report 2005
26 Pensions continued
(b) FRS 17 (Retirement Benefits)
As stated above, the Group operates two principal defined benefit pension schemes and contributes to the Executive Group Limited
Shared Cost Section of the Railway Pension Scheme. The valuations used for the FRS 17 disclosure have been based on the most
recent actuarial valuations at 6 April 2002, updated to 31 March 2005 by a qualified actuary.
As required by SSAP 24, the figures included in the Accounts in respect of the Group pension schemes are based on actuarial 
valuations carried out at 6 April 2002 and this does not take into account any impact of the movement in general stock market 
values since that date. Any such impact will be reflected in the next SSAP 24 triennial valuation as at 6 April 2005, based upon 
which subsequent pension costs will be determined until the adoption of FRS 17. The figures currently used for accounting 
purposes as regards pension costs are likely to change significantly as and when FRS 17 and IFRS are adopted.
The costs of death-in-service benefit for members of the Scheme are fully insured by the schemes.
The projected unit valuation method has been used. The major financial assumptions used by the actuary were:
At 31 March At 31 March At 31 March
2005 2004 2003
Discount rate 5.50% 5.50% 5.50%
Rate of increase in salaries 3.00% 3.50% 3.50%
Rate of increase of pensions in payment (pre April 2002) 3.00% 3.00% 3.00%
Rate of increase of pensions in payment (post April 2002) 3.00% 2.75% 2.50%
Rate of increase of deferred pensions 3.00% 2.75% 2.50%
Inflation assumption 3.00% 2.75% 2.50%
The assets of the schemes and expected rates of return were:
Long-term rate Long-term rate Long-term rate
of expected Value at of expected V alue at of expected V alue at
return at 31 March 2005 return at 31 March 2004 return at 31 March 2003
31 March 2005 £’000 2004 £’000 2003 £’000
Equities 7.75% 34,113 7.50% 32,907 7.25% 19,284
Bonds 5.50% 1,774 5.25% 556 5.50% 3,343
Others 5.50% 10,409 4.00% 3,284 4.00% 3,316
Property 7.50% 2,856 7.50% 2,028 – –
Total market value of assets 49,152 38,775 25,943
Present value of schemes’ liabilities (56,223) (45,918) (37,051)
Deficit in the schemes (7,071) (7,143) (11,108)
Related deferred tax asset 2,121 2,143 3,333
Net pension liability (4,950) (5,000) (7,775)
Analysis of amount that would have been charged to operating profit under FRS 17
At At 
31 March 2005 31 March 2004
£’000 £’000
Current service cost 2,586 2,952
Past service cost 9 224
Total operating charge 2,595 3,176
Analysis of amount that would have been charged to interest under FRS 17
At At 
31 March 2005 31 March 2004
£’000 £’000
Expected return on pension schemes’ assets 2,836 1,924
Interest cost (2,645) (2,187)
Net return 191 (263)
The amount recognised in the statement of total recognised gains and losses had FRS 17 been operative would have been 
as follows:
At At
31 March 2005 31 March 2004
£’000 £’000
Actual return less expected return on pension schemes’ assets 2,368 3,474
Experience loss on scheme liabilities (977) (165)
Changes in financial assumptions underlying the schemes’ liabilities (2,272) –
Actuarial (loss)/gain recognised in the statement of total recognised gains and losses (881) 3,309
55 56 MITIE Group PLC Annual Report 2005
26 Pensions continued
Movements in deficit during the year
At At 
31 March 2005 31 March 2004
£’000 £’000
Deficit in schemes at beginning of year (7,143) (11,108)
Movement in year
Current service cost (2,586) (2,952)
Contributions 3,357 4,095
Past service costs (9) (224)
Other finance income/(loss) 191 (263)
Actuarial (loss)/gain (881) 3,309
Deficit in schemes at the end of the year (7,071) (7,143)
The impact to the Balance Sheet and Reserves at 31 March 2005 of adopting FRS 17 would be as follows:
At At 
31 March 2005 31 March 2004
£’000 £’000
Net assets excluding pension liability 141,787 135,849
Net pension liability (4,950) (5,000)
Net assets including pension liability 136,837 130,849
Profit and loss reserve excluding pension liability 68,376 70,212
Net pension liability (4,950) (5,000)
Profit and loss reserve including pension liability 63,426 65,212
History of experience gains and losses
At At At
31 March 2005 31 March 2004 31 March 2003
Difference between the expected and actual return on scheme assets:
Amount (£’000) 2,368 3,474 (5,061)
Percentage of scheme assets 5% 9% 20%
Experience gains and losses on scheme liabilities:
Amount (£’000) (977) (165) (6,035)
Percentage of the present value of scheme liabilities 2% 0% 23%
Changes in financial assumptions underlying the schemes assets:
Amount (£’000) (2,272) ––
Percentage of the present value of scheme liabilities 4% ––
Total actuarial (loss)/gain in the statement of total recognised gains and losses:
Amount (£’000) (881) 3,309 (11,096)
Percentage of the present value of scheme liabilities 2% 7% –
27 Related party transactions 
During the year the Group received interest of £10,000 (2004: £15,000) on loan notes with The Platform Holding Company Limited; 
a company in which C S Acheson held a Directorship. In addition, this company paid rent to the Group of £36,000 (2004: £36,000). 
No fees were paid by the Platform Holding Company Limited in respect of the services provided by C S Acheson either to MITIE or 
C S Acheson (2004: £nil). No balances were outstanding at the year end (2004: £nil).
During the year the Group provided services amounting to £139,000 (2004: £110,000) to The Bristol Port Company Ltd; a company 
in which D C Ord held a Directorship. At the end of the year the amount owed to the Group was £12,000 (2004: £10,000).
During the year the Group provided services amounting to £700,000 (2004: £160,000) to Sir Robert McAlpine Ltd; a company in which
C McAlpine held a Directorship. At the end of the year the amount owed to the Group was £292,000 (2004: £15,000). 
During the year I R Stewart paid £8,000 (2004: £nil) to the Group and subsidiary undertakings in respect of goods and services in the
ordinary course of business. No balances were outstanding at the year-end (2004: £nil).
During the year the Group earned interest of £85,000 (2004: £nil) on loan notes and loans with Generation (UK) Ltd; a company in
which I R Stewart held a Directorship. In addition, the company paid rent to the Group of £90,000 (2004: £nil). £72,000 was outstanding
at the year end (2004: £nil). No fees were paid by Generation (UK) Ltd in respect of the services provided by I R Stewart either to MITIE
or I R Stewart (2004: £nil).
No material contract or arrangement has been entered into during the year , nor existed at the end of the year , in which a Director
had a material interest.
The Company has taken advantage of the exemption in FRS 8 not to disclose transactions with companies within the Group. Notes to the Accounts for the Year Ended 31 March 2005 continued
MITIE Group PLC Annual Report 2005
28 Principal operating subsidiary and associated companies
The companies set out below are those which were part of the Group at 31 March 2005 and in the opinion of the Directors 
significantly affected the Group’s results and net assets during the year.
At 31 March 2005
% ordinary shares owned
Cleaning MITIE Cleaning Ltd (i), (ii) 96
MITIE Cleaning (Midlands) Ltd (i), (ii) 96
MITIE Cleaning (North) Ltd (i), (ii) 96
MITIE Cleaning Services Ltd (ii) 96
MITIE Cleaning (South East) Ltd (i), (ii) 96
MITIE Cleaning (Southern) Ltd (i), (ii) 96
MITIE Cleaning (South Wales) Ltd (i), (ii) 96
MITIE Cleaning (South West) Ltd (i), (ii) 96
MITIE Industrial Cleaning (North) Ltd 59
MITIE Olscot Ltd (i), (ii) 96
MITIE Services (Retail) Ltd (ii) 56
MITIE Transport Services Ltd (ii) 86
Catering MITIE Catering Services Ltd 51
MITIE Catering Services (London) Ltd 61
MITIE Catering Services (Northern) Ltd 100
Landscape and Pest Control Eagle Pest Control Services (UK) Ltd 100
MITIE Landscape (Northern) Ltd (ii) 56
MITIE Landscape (Southern) Ltd (ii) 57
Security MITIE Security Ltd 100
MITIE Security (North) Ltd (ii) 53
MITIE Security (Scotland) Ltd (ii) 81
MITIE Security (South West) Ltd 54
MITIE Trident Security Ltd 100
Managed Services MITIE Business Services Ltd 52
MITIE Managed Services Ltd 100
MITIE Managed Services (Southern) Ltd 100
MITIE Managed Services (South West and Wales) Ltd 69
MITIE PFI Ltd 100
Engineering Maintenance MITIE Engineering Maintenance Ltd 100
MITIE Engineering Maintenance (Caledonia) Ltd 57
MITIE Engineering Maintenance (North) Ltd 51
MITIE Engineering Maintenance (South West) Ltd 53
Engineering MITIE Air Conditioning (London) Ltd 65
MITIE Air Conditioning (Midlands) Ltd 67
MITIE Air Conditioning (North) Ltd 100
MITIE Air Conditioning (Scotland) Ltd 70
MITIE Air Conditioning (South West) Ltd 100
MITIE Air Conditioning (Wales) Ltd 54
MITIE Air Conditioning (West) Ltd 51
MITIE Cleanrooms Ltd 80
MITIE Engineering Ltd 68
MITIE Engineering Projects Ltd 63
MITIE Engineering Services Ltd 100
MITIE Engineering Services (Bristol) Ltd 100
MITIE Engineering Services (Cardiff) Ltd 100
MITIE Engineering Services (Eastern) Ltd 100
MITIE Engineering Services (Edinburgh) Ltd 52
MITIE Engineering Services (Guernsey) Ltd 100
MITIE Engineering Services (Jersey) Ltd 100
MITIE Engineering Services (Leeds) Ltd 56
MITIE Engineering Services (Liverpool) Ltd 51
MITIE Engineering Services (London) Ltd 100
MITIE Engineering Services (Midlands) Ltd 55
MITIE Engineering Services (North) Ltd 100
MITIE Engineering Services (North East) Ltd 65
MITIE Engineering Services (Peninsula) Ltd 100
MITIE Engineering Services (Retail) Ltd 93
MITIE Engineering Services (Scotland) Ltd 100
MITIE Engineering Services (South East) Ltd 100
MITIE Engineering Services (South West) Ltd 100
MITIE Engineering Services (Swansea) Ltd 54
MITIE Engineering Services (West Midlands) Ltd 59
MITIE Environmental Ltd 51
MITIE Scientific Projects Ltd 69
MITIE Scotgate Ltd (i) 51
MITIE Technology Ltd 53
57 58 MITIE Group PLC Annual Report 2005
28 Principal operating subsidiary and associated companies continued
Property Services MITIE Flooring (Southern) Ltd 68
MITIE Greencote Ltd 100
MITIE Interiors Ltd 54
MITIE McCartney Fire Protection Ltd 75
MITIE Property Services Ltd 100
MITIE Property Services (Eastern) Ltd 68
MITIE Property Services (UK) Ltd 100
Administration Cole Motors Ltd 100
MITIE Property Investments Ltd 100
MITIE Reinsurance Company Ltd 100
(i) Shareholdings held by intermediate subsidiary undertakings
(ii) Denotes company operates 13 four-weekly period
All companies were incorporated in and operate within the United Kingdom, except for MITIE Reinsurance Company Ltd and MITIE
Engineering Services (Guernsey) Ltd, which are registered and operate in Guernsey, and MITIE Engineering Services (Jersey) Ltd,
which was registered and operates in Jersey.
Certain companies (as noted in the table above) operate on the basis of 13 four-weekly periods and have drawn up their 
accounts to 2 April 2005. Adjustments have been made on consolidation to exclude the results of these companies for the 
period from 31 March 2005 to that date.
The Group has a 33% interest in an associate company, Service Management International Ltd. As this is not considered material,
separate disclosure of its results, assets or liabilities have not been included in the financial statements.
The companies listed above represent the principal operating subsidiary companies of the Group. 
A full list of subsidiary companies will be annexed to the next annual return. ■ International Financial Reporting Standards
MITIE Group PLC Annual Report 2005 59
International Financial Reporting Standards
Adoption of International Financial Reporting Standards (‘IFRS’) (unaudited)
Introduction
From the year ended 31 March 2006 onwards MITIE Group PLC will be adopting IFRS in its consolidated financial state-
ments in compliance with European Union regulation. This will lead to a number of changes in reported financial
data, which will also be reflected in the Group’s comparative financial information for the prior period. 
The Group started its IFRS project in 2004. The project has entailed an assessment of the impacts of IFRS on the
Group’s accounting policies and reported results as well as ensuring appropriate processes are in place to capture
relevant information going forward. The work is on track to provide an analysis of the full impact of the adoption of
IFRS on the Group’s audited 2005 and 2006 results and respective balance sheets. Other than the format of presenta-
tion, there is not expected to be any cash flow impact from the adoption of IFRS. We will disclose the full impact of the
adoption of IFRS on our audited 2005 results with our Interim Results for the period ending 30 September 2005.
It is possible that other adjustments may come to light, as we complete our work, which will impact the Company in
the preparation of the first full set of IFRS Financial Statements. In addition, the process of approving standards and
interpretations is still on-going by the International Accounting Standards Board and European Commission and as
such further amendments may arise from this process.
In the meantime, we set out below the main decisions taken on first time adoption and a summary of the main 
areas of impact on the Group’s operating profit and Balance Sheet together with indicative estimates of the 
related amounts.
IFRS 1 Exemptions
IFRS 1 ‘First-time adoption of International Accounting Standards’ sets out the procedures the Group must follow
when it adopts IFRS for the first time as the basis for preparing its consolidated financial statements. The Group is
required to determine its IFRS accounting policies and apply these retrospectively to determine its opening Balance
Sheet under IFRS. The standard allows a number of exceptions to this general principle to assist companies in their
transition to reporting under IFRS.
The Group will take the following significant exemptions:
■ Share-based payments: only equity instruments granted after 7 November 2002 and that had not vested prior to 
1 April 2005 will be included in the charge to income for the year ended 31 March 2005.
■ Business combinations: business combinations prior to our transition date (1 April 2004) will not be restated.
■ Employee benefits: all actuarial gains and losses will be recognised in equity at the transition date. This is to maintain
consistency with the treatment under FRS 17 and the policy going forward of taking actuarial gains or losses directly
to reserves via the Statement of Recognised Income and Expense.
Summary of main areas of impact
1. Share-based payments
Under IFRS 2, the imputed fair value at the date of grant of options issued to employees under savings related and
executive share option schemes will be charged to operating profit on a straight line basis over the relevant vesting
period. This will result in a reduction in the Group’s reported operating profit, as the cost will be higher than that 
currently charged under UK GAAP. The impact is estimated to be around £0.5 million in the year to 31 March 2005.
2. Business combinations: Goodwill and other intangibles
Under IFRS 3, goodwill is no longer amortised and instead is assessed annually for impairment. Goodwill arising on
acquisitions before 1 April 2004 will not be restated; other intangible assets arising from acquisitions after 1 April 2004
will be separately identified and amortised over their estimated useful economic lives, which may be over shorter
periods than goodwill has previously been amortised.
As a result of this change, the Group’s operating profit will be increased by the amount of goodwill amortisation
under UK GAAP. For the year to 31 March 2005, this amounted to £2.8 million. In the year to 31 March 2006, the
Group’s operating profit will be impacted by any impairment of goodwill and the amortisation of other purchased
intangible assets on acquisitions post 1 April 2004. 60 MITIE Group PLC Annual Report 2005
3. Employee benefits
Under IAS 19 Pensions are charged to the Profit and Loss Account using a different basis of accounting from SSAP 24.
IAS 19 uses a balance sheet approach (similar to FRS 17, the impact of which is provided in Note 26 to the accounts)
for pensions cost accounting rather than a determination based on long-term actuarial assumptions. The profit and
loss expense is determined using annually derived assumptions as to salary inflation, investment returns and discount
rates, past service costs, net actuarial gain/loss recognised in year based on prevailing conditions at the start of the
year. Any surplus or deficit on defined benefit schemes at the Balance Sheet date is recognised in the Balance Sheet.
Where actual experience differs from the assumptions made, actuarial gains and losses will be recognised through
the Statement of Recognised Income and Expense.
The adoption of IAS 19 is not anticipated to result in a significant change to operating profit compared to SSAP 24 
for 2005 or 2006.
At 1 April 2005, the gross value of the deficit that will now be recognised as a liability in the Balance Sheet will be 
£7.6 million with a corresponding entry to reduce Shareholders’ equity. 
4. Deferred tax
IAS 12 Income Taxes requires deferred tax to be recognised in full. The principal adjustments are in respect of deferred
tax on pension liabilities (point 3 above) and share based payments (point 1 above).  The deferred tax arising partially
offsets the adjustments above and will be reflected as above (e.g. deferred tax arising on pension deficit at 1 April
2005 will be reflected as an increase in Shareholders’ equity).
5. Leases
IAS 17 establishes a new methodology to determine whether leases are to be treated as operating or finance leases.
This particularly affects leases over land and buildings which must be split into their constituent parts and assessed
separately. A review of the Group’s portfolio of operating leases is being undertaken to determine whether the 
current operating lease treatment remains appropriate under IAS 17. ■ Five-Year Summary
MITIE Group PLC Annual Report 2005 61
Five-Year Summary
2005 2004 2003 2002 2001
£0’000 £’000 £’000 £’000 £’000
Group Profit and Loss Account
Turnover 818,629 694,513 565,840 518,852 415,375
Profit on ordinary activities before goodwill, 
integration costs and tax 46,908 41,374 34,113 30,997 25,148
Net profit margin (before goodwill amortisation 
and impairment and integration costs) 5.8% 6.0% 6.0% 6.0% 6.0%
Integration costs on acquisitions – (1,031) – – –
Profit before tax and goodwill 46,908 40,343 34,113 30,997 25,148
Goodwill amortisation and impairment (2,825) (2,163) (2,324) (640) (73)
Loss on sale of discontinued operations (9,617) ––––
Profit on sale of tangible fixed assets from continuing operations 1,471 ––––
Profit on ordinary activities before tax 35,937 38,180 31,789 30,357 25,075
Taxation (14,315) (12,293) (10,188) (9,027) (8,420)
Profit on ordinary activities after tax 21,622 25,887 21,601 21,330 16,655
Minority interests (3,024) (2,533) (2,125) (2,712) (2,703)
Dividends (10,346) (7,884) (5,736) (4,623) (3,497)
Retained profit 8,252 15,470 13,740 13,995 10,455
Group Balance Sheet
Intangible fixed assets 49,908 51,937 24,291 14,724 8,597
Tangible fixed assets 27,214 40,329 37,277 45,082 48,123
Other assets and liabilities 64,665 43,583 50,996 23,439 3,583
141,787 135,849 112,564 83,245 60,303
Equity Shareholders’ funds 132,147 129,233 104,900 74,491 50,166
Minority Interests 9,640 6,616 7,664 8,754 10,137
141,787 135,849 112,564 83,245 60,303
Earnings per share 6.1p 7.6p 6.5p 6.5p 5.0p
Pre-goodwill and exceptional items earnings per share 9.6p 8.3p 7.3p 6.8p 5.1p
Dividend per share 3.4p 2.5p 1.9p 1.6p 1.25p
Earnings and dividend per share figures have been restated to reflect the subdivision of shares in 2001. 62 MITIE Group PLC Annual Report 2005
Notice of Meeting
Notice is hereby given that the 69th Annual General Meeting of MITIE Group PLC will be held at The Merchants’ Hall, 
The Promenade, Clifton Down, Bristol, BS8 3NH on Thursday, 28 July 2005 at 12 noon for the following purposes:
Ordinary business
To consider and, if thought fit, pass the following Resolutions, which will be proposed as Ordinary Resolutions:
1. That the Accounts for the year ended 31 March 2005 and the Reports of the Directors and Auditors thereon be received.
2. That the Directors’ Remuneration Report for the year ended 31 March 2005 contained in the Accounts be approved.
3. That a final dividend for the year ended 31 March 2005 of 1.8p per Ordinary Share of 2.5p each be declared.
4. That Ian Reginald Stewart be re-elected as a Director.
5. That Manish Jayantilal Chande be re-elected as a Director.
6. That Sir John Southwood Jennings be re-elected as a Director.
7. That Deloitte & Touche LLP be reappointed as Auditors of the Company until the conclusion of the next general meeting 
before which accounts are laid and that their remuneration be determined by the Directors.
Special business
To consider and, if thought fit, pass the following Resolutions, which will be proposed as Special Resolutions:
8. That the Directors be generally empowered, pursuant to Section 95 of the Companies Act 1985, to allot equity securities 
(within the meaning of Section 94 of the said Act) for cash as if sub-section (1) of Section 89 of the said Act did not apply 
to any such allotment, provided that this power shall be limited:
(a) to the allotment of equity securities in connection with a rights issue in favour of the holders of Ordinary Shares of 2.5p each where
the equity securities respectively attributable of the interests of all such Shareholders are proportionate (as nearly as may be) to
the respective number of Ordinary Shares held by them but subject to such exclusions or other arrangements as the Directors 
may deem necessary or expedient to deal with any legal or practical problems under the laws of any overseas territory or 
the requirements of any regulatory body or any stock exchange in any territory or in relation to fractional entitlements; and 
(b) to the allotment (otherwise than pursuant to sub-paragraph (a) above) of equity securities up to an aggregate nominal 
value of £378,750 (approximately 5% of the issued share capital); 
and this authority shall expire 15 months after the date of the passing of this Resolution or at the conclusion of the next Annual
General Meeting of the Company, whichever comes first, save that the Company may before such expiry make an offer or
agreement that would or might require equity securities to be allotted after such expiry and the Directors may allot equity 
securities in pursuance of such offer or agreement as if the power conferred hereby had not expired.
9. That the Company be generally and unconditionally authorised to make market purchases (within the meaning of Section 163(3)
of the Companies Act 1985) of Ordinary Shares of 2.5p each in the Company, on such terms and in such manner as the Board of
Directors of the Company may from time to time determine, provided that:
(a) the maximum number of Ordinary Shares that may be purchased is 30,300,000 (approximately 10% of the issued share capital);
(b) the minimum price that may be paid for an Ordinary Share is 2.5p, exclusive of expenses; and
(c) the maximum price that may be paid for an Ordinary Share is an amount equal to 105% of the average of the middle market
quotation of an Ordinary Share of the Company as derived from the Daily Official List of the London Stock Exchange on the
five business days immediately preceding the day on which the Ordinary Share is purchased, exclusive of expenses; 
and this authority shall expire 15 months after the date of the passing of this Resolution or at the conclusion of the next Annual
General Meeting of the Company, whichever comes first, except in relation to purchases of shares, the contract for which 
was concluded before the expiry of this authority and which might be executed wholly or partly after such expiry.
10.That the draft Article set out below be and is adopted by the Company in substitution for Article 87.1 of its existing articles of 
association:
87.1 (a) ‘Subject to Article 87.1 (b) below, at every Annual General Meeting one third of the Directors who are subject to 
retirement by rotation or , if their number is not 3 or a multiple of 3, the number nearest to but not exceeding one third shall 
retire from office by rotation provided that if there is only one Director who is subject to retirement by rotation, he shall retire.
87.1 (b) Notwithstanding Article 87.1 (a) above, every Director who is subject to retirement by rotation shall retire from office 
by rotation at least once every three years.’
By order of the Board Registered Office:
35 Duchess Road
Rutherglen
Glasgow
G73 1AU
Corina K Ross Company Secretary
20 May 2005 Notice of Meeting
MITIE Group PLC Annual Report 2005
Notes:
1. Any member entitled to attend and vote at this meeting may appoint one or more proxies to attend and, on a poll, vote instead of him or her. 
A proxy need not be a member of the Company.
2. To be effective, forms of proxy duly completed must be received by the Company’s Registrars, Computershare Investor Services PLC, PO Box 1075,
Bristol BS99 3FA not less than 48 hours before the time appointed for the holding of the meeting or any adjournment thereof. Completion of a form of
proxy does not preclude a member from attending the meeting and voting in person.
3. The Company, pursuant to regulation 41 of the Uncertificated Securities Regulations 2001, specifies that only those members registered in the Register
of Members of the Company as at 6.00pm on 26 July 2005 shall be entitled to attend and/or vote at the meeting in respect of the number of shares
registered in their name at that time. Changes to entries on the Register of Members after 6.00pm on 26 July 2005 shall be disregarded in determining
the rights of any person to attend or vote at the meeting.
4. The following documents will be available for inspection at the Registered Office and Head Office of the Company during normal business hours on
any weekday (public holidays excepted) from the date of this Notice until the date of the meeting, and at the place of the meeting from 11.45 am
until its conclusion:
■ The Register of Directors’ interests in the share capital of the Company kept pursuant to Section 325 of the Companies Act 1985;
■ Copies of the Directors’ service agreements and letters of appointment; and
■ Copies for the existing and proposed new Articles of Association of the Company, referred to in Resolution 10.
5. The total number of options to subscribe for Ordinary Shares that were outstanding as at 19 May 2005 was 11,920,307, representing approximately
3.9% of the issued share capital of the Company. This would represent 4.4% of the issued share capital if the maximum number of Ordinary Shares
were purchased under the authority proposed under Resolution 9.
63 64 MITIE Group PLC Annual Report 2005
Results
2005 Half year 29 November 2004
2005 Full year 23 May 2005
2006 Half year 28 November 2005
Dividends
2005 Interim 1.6p (2004: 1.1p) Paid 31 March 2005
2005 Final (proposed) 1.8p (2004: 1.4p) Pay date 30 September 2005 (to
Shareholders on the Register on  2
September 2005
Annual General Meeting 
V enue: The Merchants’ Hall, 
The Promenade, 
Clifton Down, 
Bristol, BS8 3NH 28 July 2005 
Capital history
Mid-market price 2 April 2001 (date of sub-division) 152.5p
Mid-market price 31 March 2005 161.25p
2005 high / low 168p / 112p
Registrars
Computershare Investor Services PLC Telephone: 0870 702 0010
Lochside House Website:www.computershare.com
7 Lochside Avenue
Edinburgh Park
Edinburgh EH12 9DJ
Company
MITIE Group PLC Telephone: 0117 970 8800
8 Monarch Court Fax: 0117 302 6743
The Brooms Contact: group@mitie.co.uk
Emersons Green Website: www.mitie.co.uk
Bristol BS16 7FH
These financial statements may be downloaded in pdf format from the Company’s website, which also contains 
additional general information on the Company.
Shareholder Information Design by Addison Corporate Marketing
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(ECF) with pulp made from renewable timber on a sustainable basis MITIE Group PLC,8 Monarch Court, 
The Brooms, 
Emersons Green, 
Bristol BS16 7FH
Telephone 0117 970 8800 
Faximile 0117 302 6743
Email information@mitie.co.uk
www.mitie.co.uk
MITIE is an equal opportunities employer