Enterprise Inns plc
Annual Report
and Accounts
2002
Enterprise Inns plc Annual Report and Accounts 2002 Goodbarns Yard, Peterborough
Royal Hotel, Sowerby Bridge, Halifax
White Horse, Kirbymoorside, York
Ship Inn, Upper Framilode
Wheatsheaf, Braishfield
Bear & Ragged Staff, Romsey
Peacock, Bakewell
Left to right:Andrew Clifford, Strategic Planning and Investment Manager;
David George, Finance Director; Ted Tuppen, Chief Executive;
Simon Townsend, Customer Services Director; Gordon Harrison, Operations Director.
The Enterprise Inns team
FINANCIAL HIGHLIGHTS 1
DIRECTORS AND ADVISERS 2
CHAIRMAN’S STATEMENT 3
CHIEF EXECUTIVE’S REVIEW 4
FINANCE DIRECTOR’S REPORT 8
DIRECTORS’ REPORT 11
CORPORATE GOVERNANCE 14
REPORT ON DIRECTORS’ REMUNERATION 16
GROUP PROFIT AND LOSS ACCOUNT 21
GROUP STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES 22
NOTE OF HISTORICAL COST PROFITS AND LOSSES 22
GROUP BALANCE SHEET 23
BALANCE SHEET 24
GROUP STATEMENT OF CASH FLOWS 25
NOTES TO THE ACCOUNTS 26
REPORT OF THE AUDITORS 49
FIVE YEAR RECORD 50
ANALYSIS OF SHAREHOLDERS 51
FINANCIAL CALENDAR 51
NOTICE OF MEETING 52
EXPLANATORY NOTES TO THE NOTICE OF AGM 54
FORM OF PROXY 55
CONTENTS
Enterprise Inns 
Head Office, Solihull
Pheasant Inn, Stone 1
ENTERPRISE INNS ANNUAL REPORT 2002
FINANCIAL HIGHLIGHTS
 Growth in adjusted earnings per share has increased by 32% compound per annum since
flotation in 1995.
 The quality of the pub estate has been improved through the acquisition of 47 individual pubs at
a cost of £18 million, the disposal of pubs generating proceeds of £25 million, and £17 million of
capital expenditure invested in the year.
 On 24 May 2002, the Company acquired the Laurel Pub Group Limited for a consideration of
£881 million, including the assumption of debt.The Laurel estate comprised 1,860 pubs, all of
which have been integrated into existing operations.
 On 20 March 2002, the Group invested £75 million to acquire a 16.8% share of a newly formed
company,The Unique Pub Company Limited. Enterprise has a call option to purchase the balance
of the equity which is exercisable between 1 January 2004 and 30 November 2004.The call
option can be exercised at a fixed price of £608 million prior to 31 March 2004.
 Average operating profit per pub in the core estate increased by 9% in the year.
 At 30 September 2002 the estate comprised 5,266 leased and tenanted pubs, an increase of 1,767
pubs in the year.The value of the estate rose to £2.2 billion.This valuation does not include a
lotting premium, which Humberts Leisure estimate would be in the region of 20% and which
would increase the value of the estate to £2.6 billion.Value in use based upon the Company’s
weighted average cost of capital amounts to £3.0 billion.
2002 2001 Increase
Operating profit before exceptional items £204.0m £104.7m 95%
Profit before tax and exceptional items £114.5m £62.6m 83%
Earnings per share before exceptional items 58.4p 39.5p* 48%
Dividends 14.1p 12.3p 15%
* adjusted for the impact of the rights issue and deferred tax 2
ENTERPRISE INNS ANNUAL REPORT 2002
DIRECTORS AND ADVISERS
Secretary
D C George
Auditors
Ernst & Young LLP , One Colmore Row,
Birmingham, B3 2DB
Bankers
Bank of Scotland, 124 Colmore Row,
Birmingham, B3 4AU
Financial Advisers and Stockbrokers
Deutsche Bank AG London,
Winchester House, 1 Great Winchester Street,
London, EC2N 2DB
HSBC Investment Bank plc,
Vintners Place, 68 Upper Thames Street,
London, EC4V 3BJ
Registrar
Computershare Investor Services PLC,
PO Box 859,The Pavilions, Bridgwater Road,
Bristol, BS99 1XZ
Solicitors
CMS Cameron McKenna, Mitre House,
160 Aldersgate Street, London, EC1A 4DD
Registered Office
3 Monkspath Hall Road, Solihull,
West Midlands, B90 4SJ
Company number
2562808
H V REID*
Chairman
Appointed to the Board 21/01/97
Hubert Reid, 62, is chairman of the Royal London
Mutual Insurance Society Limited, Deputy Chairman of
Majedie Investments PLC and a non-executive director
of the Taverners Trust PLC. He was previously managing
director and then chairman of the Boddington Group
plc and Chairman of Ibstock Plc and Bryant Group plc.
G E TUPPEN
Chief Executive
Appointed to the Board 22/02/91
Ted Tuppen,50,led the management buy-in which resulted
in the formation of the Company in 1991.He is a chartered
accountant and was in practice until 1980 with KPMG in
London,North America and Europe.He then qualified with
an MBA from the Cranfield School of Management before
becoming managing director of a privately owned
international engineering company where he worked until
1989.He has also worked in,and acted as a consultant to,a
variety of businesses.He is chairman of the Pub and
Leisure Group at the British Beer and Pubs Association and
a director of The Unique Pub Company Limited.
M F GARNER*
Non-Executive Director and Senior
Independent Director
Appointed to the Board 29/09/95
Michael Garner, 65, is a non-executive director of C & J
Clark Limited and Gyrus plc. He was a member of the
Accounting Standards Board from 1990 to 1995 and was
finance director of TI Group PLC until 1993.
K M H MILLAR
Non-Executive Director
Appointed to the Board 29/09/95,
Retired from the Board 24 January 2002
Keith Millar, 69, was Chairman of Henderson Crosthwaite
Limited and of Guinness Mahon Development Capital
Limited. He is a member of the Council of the British
Heart Foundation and was Honorary Treasurer and
Chairman of the Executive Committee.
A J STEWART*
Non-Executive Director
Appointed to the Board 29/05/01
Jo Stewart, 53, is Chief Executive of Northern Foods plc, a
fellow of the Institute of Grocery Distribution, a member
of the CBI National Manufacturing Council and was
previously a non-executive Director of Bryant Group plc.
D C GEORGE
Finance Director
Appointed to the Board 08/07/91
David George, 51, joined the Company on its formation
as part of the management buy-in team.A qualified
accountant, he spent ten years in industry including six
years at Massey Ferguson Manufacturing Limited. He
then spent ten years with Grand Metropolitan Brewing
Limited in various finance roles, including finance
director of The Manns and Norwich Brewery Company
Limited and subsequently as finance director of the
production division of Grand Metropolitan Brewing.
G W HARRISON
Operations Director
Appointed to the Board 23/10/94
Gordon Harrison, 45, joined the Company on its
formation and was appointed to the Board in October
1994. He has 23 years’ licensed trade experience
specialising in tenanted operations and retail
management with Watney Mann Truman Brewers Ltd,
the Greenalls Group plc and the Vaux Group plc. He is
responsible for the operation of the pub estate.
W S TOWNSEND
Customer Services Director
Appointed to the Board 01/10/2000
Simon Townsend, 40, joined the Company in February
1999, and was appointed to the Board in October 2000.
He has worked for 16 years in the pub and leisure
industry, previously with Whitbread plc,Allied Domecq,
Rank Group, Marston,and Thompson & Eversheds. He is
responsible for the provision of all support services to
the Enterprise estate.
* Member of the Audit and Remuneration Committees 3
ENTERPRISE INNS ANNUAL REPORT 2002
CHAIRMAN’S STATEMENT
I
am delighted to report on our results and activities in the year to 30 September 2002. During the 
year we achieved strong growth in our financial performance, invested £75 million for a 16.8% stake
in The Unique Pub Company Limited (formed by an equity consortium to purchase both the Unique
and Voyager pub estates totalling 4,189 pubs), and acquired 1,860 pubs from Laurel Pub Holdings
Limited for a total consideration of £881 million.These investments were financed by a combination of
increased borrowings and the proceeds of a rights issue which raised £292 million net of fees and
expenses.
The results benefited from the two investments made in 2001 (the acquisition of 439 managed pubs
from MGPE in June followed by the purchase of 431 managed pubs from S&N in July), the contribution
from the Laurel Pub Partnerships (LPP) estate, and from our share of Unique Pub Company Limited
income net of interest.
Operating profit before exceptional items increased by 95% to £204 million and profit before tax and
exceptional items rose by 83% to £114.5 million. Exceptional items in the year of £22.2 million included
£8.5 million expenses associated with the acquisition of the LPP pubs, £7.6 million representing the
write-off of unamortised bank fees resulting from the refinancing of debt facilities and £5.9 million
representing our 16.8% share of exceptional costs incurred by Unique Pub Company (Unique).
Earnings per share, excluding exceptional items, increased by 48% to 58.4 pence.
During the year accounting standard FRS19, Deferred Tax, has been adopted and full provision for deferred
taxation has been made. Earnings per share calculations reflect the full provisioning methodology and
prior year numbers have been restated to reflect this and the bonus element of the rights issue.
The directors are recommending a final dividend of 9.4 pence per share, making a total for the year of
14.1 pence per share.At the time of the rights issue I said in my letter to shareholders that future
dividends would be adjusted to take account of the bonus element of the rights issue. However, I am
pleased to report that the directors now feel this to be unnecessary given the Company’s strong and
stable cash flows.The final dividend payment of 9.4 pence equates to a 42% increase on prior year if the
prior year payment of 8.2p is restated to 6.6p to take account of the bonus element of the rights issue.
The total dividend will be covered 3.1 times, but when adjusted for exceptional items will be covered
4.2 times.The dividend will be paid on 24 January 2003 subject to shareholder approval.
These strong financial results demonstrate both the robust nature of our business model and the
capability to evaluate successfully the potential returns from acquisitions and then to deliver them as
anticipated.
It has been another successful and demanding year for Enterprise and our thanks are due to all our staff
and licensees for rising to the challenges they have faced.We extend our thanks also to our shareholders
and suppliers for their support and welcome particularly the many new licensees who have joined us in
the past year.
Our enlarged estate provides the Company with many opportunities for continued profitable growth
and we look forward to another year of solid progress.
Hubert Reid
Chairman 4
ENTERPRISE INNS ANNUAL REPORT 2002
CHIEF EXECUTIVE’S REVIEW
Results
The year to 30 September 2002 has once again delivered strong growth in earnings to Enterprise Inns
and its shareholders.Total Group operating profit before exceptional items almost doubled, increasing
by 95% to £204 million, fuelled by like for like growth of 9% in the core estate and further enhanced by
the successful integration of key strategic acquisitions made over the past two years.
High quality acquisitions, a clearly focused investment programme alongside licensees and aggressive
pruning of under-performing outlets have once again significantly improved the quality and potential of
the enlarged Enterprise estate of 5,266 pubs, with average operating profit per pub up by 24% to
£46,000.
Adjusted earnings per share increased by 48% to 58.4p, continuing a trend that has seen the Enterprise
team deliver compound annual growth in earnings per share of 32% over the seven year period since
flotation in 1995.
1996 1997 1998 1999 2000 2001 2002
60
50
40
30
20  
10
0
220
200
180
160
140
120
100
80
60
40  
20
0
12.5
21.2
33.1
52.6
75.6
104.7
204.0
Adjusted EPS (pence)
Operating Profit before exceptional items (£m)
10.8 10.6
16.1
19.0
31.5
39.5
58.4 5
ENTERPRISE INNS ANNUAL REPORT 2002
CHIEF EXECUTIVE’S REVIEW
Acquisitions
During the past year, we successfully completed two significant, transforming corporate transactions:
Unique Pub Company
In March 2002, working alongside a consortium of venture capitalists, we created a special purpose
vehicle to acquire the Unique and Voyager estates of some 4,200 pubs. Independently managed, this
high quality national estate is performing well, and is expected to deliver an annual rate of return of
over 20% on our £75 million investment.
At the time of the transaction, the venture capital consortium granted Enterprise a call option to acquire
their equity for a fixed price of £720m.This call option may be exercised between January and
November 2004.
In September 2002, the Unique and Voyager estates were combined and the level of securitised debt in
the combined business was increased to £1.8 billion.The success of this securitisation enabled Unique
to repay £85 million to the venture capital consortium. Subject to satisfying certain conditions, a further
increase in debt of approximately £170 million has been approved in principle by the bond holders,
which funds may again be used to repay the venture capital consortium.
As a result of these repayments, the fixed price at which Enterprise can acquire in March 2004 the
balance of equity not already owned has been reduced from £720 million to £608 million and may be
further reduced if the second debt issue proceeds.
Laurel Pub Partnerships (LPP)
In May 2002 we acquired the LPP estate from Morgan Grenfell Private Equity for £881 million.This
national estate of 1,860 leased and tenanted pubs is recognised as one of the best pub estates in the UK
and it formed an excellent geographical fit with our existing estate.
The integration of the LPP business has been completed within budget and slightly ahead of schedule.
The LPP offices in Luton were closed in July, having successfully transferred all systems and
administrative functions to the new Enterprise head office in Solihull. Following a further period of
careful planning and communication with licensees, the Enterprise and LPP estates were fully integrated
on 1 October 2002. Our new field operations structure now comprises two sectors, north and south,
each comprising 7 divisions, with each having 7 regions of approximately 54 pubs per region.
The acquisition has once again highlighted our ability to identify acquisition opportunities, complete
the transaction and effectively integrate the pubs into our growing estate.We are delighted that the
majority of the former LPP field-based team chose to stay with Enterprise, providing continuity and a
wealth of experience which has contributed in such a positive manner to the seamless integration of
this major acquisition. 6
ENTERPRISE INNS ANNUAL REPORT 2002
CHIEF EXECUTIVE’S REVIEW
The skills that we have developed and the experience gained from integrating the many acquisitions
that we have made in the past seven years mean that we can plan with confidence the integration of
the Unique estate should we exercise the call option in 2004.
Leases and tenancies
Since flotation in 1995, we have worked hard to demonstrate the long term strengths of the leased and
tenanted pub sector. Financially, they are relatively simple to understand — strong, predictable and
transparent profit and cash flows, an appreciating asset base, along with the availability of attractive
fixed rate long-term funding and a resilience to the economic cycle.
I am pleased that gradually we are creating an awareness in the market that double digit earnings
growth is achievable within the core estate, with pure organic growth and market share gain
complemented by effective management of the pub estate and the cash generated from our business.
Perhaps more importantly for the long term, the retail benefits of the leased and tenanted sector have
become more apparent as sensible investment and estate churning have enhanced the overall quality of
the pubs and the potential profit for licensees.
Unlike the branded pub chains, where a standard format is decided centrally and then imposed nationally,
we seek originality through the diversity of the estate, working alongside and encouraging licensees to
develop their pub in a style which suits them and their customers.Whatever the format, food led or
entertainment venue, specialist cask ale or sports bar, community pub or destination outlet, the Enterprise
estate abounds with examples where a committed, entrepreneurial licensee has worked in partnership
with the Enterprise team to develop their pub as the preferred choice for customers in its location.
There are of course challenges to this symbiotic relationship between pub companies and their
licensees, above all the need to ensure that the licensees are given every opportunity to succeed and are
properly rewarded for their efforts. In this respect, we believe that Retailers in Partnership model offers
the package most likely to appeal to licensees. Our comprehensive drinks range, which may be centrally
ordered and single-drop delivered, includes brands from more than 100 brewers in the UK and overseas.
Open negotiation, a commitment to fair rents, a cooling off period for new licensees and no upwards-
only rent reviews means that our lease and tenancy agreements are highly regarded in the industry.
Training, investment and business support are tailored to meet the needs of each licensee and the
business that they are seeking to create. In short, we recognise that good licensees are the vital
ingredient to the success of our business and we seek to attract the best by offering the fairest package.
Conclusion
This has been a very successful, transforming year for Enterprise Inns.With the acquisition of LPP we
have become the largest operator of leased and tenanted pubs in the UK and, more importantly for the CHIEF EXECUTIVE’S REVIEW
long-term success of the business, we now own what we believe to be the highest quality portfolio of
leased and tenanted pubs in the UK.
Our reputation amongst licensees continues to grow as we are seen to have a long-term commitment to
the sector and a recognition that fairness in our relationship with licensees is the key to long-term
mutual success and profitability.
Our new head office in Solihull brings all employees under one roof, including the new in-house
customer service and telesales team.These new offices provide not only a top-quality working
environment but also have capacity to absorb the additional head office staff required to operate the
Unique estate should the option be exercised in 2004.The head office and field-based teams continue to
perform ahead of expectations, evident by the continuing success of the business, built upon a culture
of openness, empowerment, accountability and reward.
We are committed to delivering strong returns to all our shareholders through appropriate operating
disciplines and an optimal financing structure.The new financial year has started well and the team
looks forward with confidence to continued success and long-term growth in returns for shareholders.
TED TUPPEN
Chief Executive
7
ENTERPRISE INNS ANNUAL REPORT 2002 8
ENTERPRISE INNS ANNUAL REPORT 2002
FINANCE DIRECTOR’S REPORT
Profit for the year
Total Group operating profit before exceptional items increased by 95% to £204.0 million and profit
before tax and exceptional items increased by 83% to £114.5 million.
As outlined in the Chairman’s Statement and the Chief Executive’s Review, on 20 March 2002 the
Company made a £75 million cash investment in a new company,The Unique Pub Company Limited
(Unique), formed to acquire the Unique Pub Company and the Voyager Pub Group.This investment
equates to 16.8% of the equity in Unique, and Enterprise’s share of Unique’s loss from 20 March to
30 September 2002 has been separately identified in the Group Profit and Loss Account.
Excluding the contribution from Unique, a summary of the Group Profit and Loss Account for the year
to 30 September 2002 compared with the prior year is as follows:
Year ended 30 September
2002 2001 Increase
£m £m % 
Turnover 368.9 245.4 50
Operating profit before exceptional items 187.2 104.7 79
Net interest payable before exceptional items (75.1) (42.1)
Profit before tax and exceptional items 112.1 62.6 79
Exceptional items (16.3) (21.9)
Profit before tax 95.8 40.7 135
Tax (28.9) (14.4)
Profit after tax 66.9 26.3 154
2002
Exceptional items in the year were as follows: £m
Costs resulting from the integration of 1,860 pubs acquired 
from Laurel Pub Holdings (8.5)
Write-off of unamortised finance costs following the refinancing of debt facilities (7.6)
Net loss on disposal of fixed assets (0.2)
(16.3)
Debt Facilities and Balance Sheet
On 26 February 2002, the Company issued £275 million of secured bonds with interest payable at
6.375% per annum until the final redemption date of 26 September 2031, thus fixing the rate of interest
payable on a proportion of the Company’s debt at an attractive interest rate for a period of almost
30 years. 9
ENTERPRISE INNS ANNUAL REPORT 2002
FINANCE DIRECTOR’S REPORT
This long-term debt facility complements previous debenture and secured bond issues made between
1999 and 2001.As a result of these arrangements a total of £585 million of long-term debt facilities are in
place at a weighted average interest cost of 6.55% per annum. It is likely that the Company will issue
further secured bonds in 2003.
The acquisition of 1,860 pubs from Laurel Pub Holdings in May for a consideration of £881 million was
financed by means of additional syndicated debt facilities and the proceeds of a rights issue.
Syndicated debt facilities of £1,280 million were arranged in May, which included a £280 million bridge
facility which has since been repaid by the proceeds of the rights issue.At the year end, £55 million of
the revolving facility was undrawn and available for drawdown.
The rights issue of three new shares for every four existing shares was made at £4.12 per share and
represented a discount of 49% to the closing middle market price of £8.14 per share on 11 April 2002,
the day prior to the announcement.The rights issue raised £292 million, net of fees and expenses.
The net assets of the Group at year end were £693.5 million, which compares with £323.1 million as at
30 September 2001.
Interest
Excluding the contribution in the year from Unique, net interest payable was £75.1 million, which was
covered 2.5 times.
Under the terms of the acquisition of 1,860 pubs through the purchase of Laurel Pub Holdings, £800
million of interest rate swap contracts (swaps) were novated to a subsidiary of Enterprise. On
1 September 2002, £250 million of these swaps were terminated and Enterprise assumed a 10 year swap
for the balance of the contracts with a notional amount of £550 million at an interest rate payable of
5.75% until 30 November 2004, and at a rate of 6.66% thereafter, until termination on 1 June 2012.
This swap, along with interest rates fixed through the issue of debentures and secured bonds referred to
above, results in 74% of the Group’s debt at year end being fixed at a blended rate of less than 7% for a
weighted average life of 17 years.The Board reviews levels of interest rate hedging on a regular basis.
Cash Flow
Net cash inflow from operating activities of £193.1 million represents an increase of 92% on prior year.
Free cash inflow increased from £24.9 million to £60.9 million:
Year ended 30 September
2002 2001
£m £m
Operating cash inflow 193.1 100.5
Interest (84.4) (37.6)
Tax (8.3) (6.0)
Capital expenditure (27.1) (22.8)
Dividends (12.4) (9.2)
Free cash flow 60.9 24.9 10
ENTERPRISE INNS ANNUAL REPORT 2002
FINANCE DIRECTOR’S REPORT
Tax Charge
The tax charge of £28.9 million, prior to the inclusion of Unique, includes a charge for deferred tax of
£5.9 million.The underlying corporation tax charge of £23.0 million represents an effective corporation
tax rate of 24%.
Dividend Payment
The Directors are recommending the payment of a final dividend of 9.4 pence per share, to be paid on
24th January 2003.This will result in a full year dividend of 14.1 pence per share, an increase of 14.6%
on prior year.The dividend is covered 3.1 times, and 4.2 times before exceptional items.
The final dividend payment of 9.4 pence per share represents a 42% increase on the prior year payment
of 8.2 pence per share when restated at 6.6 pence per share to take account of the bonus element of
the rights issue.
Financial Reporting Standards (FRS)
From the start of the financial year the Group has adopted FRS 19: Deferred Tax.This standard requires
full provision to be made for deferred tax arising from timing differences between the recognition of
gains and losses in the financial statements and their recognition in the tax computation.Where
appropriate, comparative figures for 2001 have been restated to reflect the impact of FRS 19.
D C George
Finance Director 11
ENTERPRISE INNS ANNUAL REPORT 2002
DIRECTORS’ REPORT
The directors present their report and accounts for the year ended 30 September 2002.
Accounts and dividends
The Group profit for the year, after taxation, amounted to £64.1m (2001 — £26.3m restated for FRS 19
Deferred Tax) and is dealt with as shown in the profit and loss account.
The directors recommend the payment of a final dividend of 9.4 pence (2001 — 8.2 pence) per
ordinary share to be paid on 24 January 2003 to members on the register on 31 December 2002.When
added to the interim dividend of 4.7 pence (2001 — 4.1 pence), this produces a total dividend for the
year of 14.1 pence (2001 — 12.3 pence) per ordinary share.
Principal activities and review of the business
The principal activities of the Group continued to be the sale of beers and cider and the collection of
rents from its estate of licensed premises.
A review of the year’s activities is given in the Chairman’s Statement, Chief Executive’s Review and the
Finance Director’s Report on pages 3 to 10.Taken together, these are intended to constitute an
Operating and Financial Review.
On 20 March 2002, the Company invested £75 million to acquire a 16.8% share of a newly formed
company,The Unique Pub Company Limited. On 24 May 2002, the Company acquired the Laurel Pub
Group Limited for total consideration of £881 million, including the assumption of debt. Details of these
acquisitions are set out in note 16.
On 30 September 2002 the assets and liabilities of Enterprise Pubs Two Limited, Enterprise Pubs Four
Limited and Enterprise Inns (No. 4) Limited were hived up into Enterprise Inns plc.
Disabled Employees
The Group gives full consideration to applications for employment from disabled persons where the
requirements of the job can be adequately fulfilled by a handicapped or disabled person.
Where existing employees become disabled, it is the Group’s policy wherever practicable to provide
continuing employment under normal terms and conditions and to provide training and career
development and promotion to disabled employees wherever appropriate.
Employee involvement
During the year, the policy of providing employees with information about the Group has been
continued through the newsletter “The Innsider”. Regular meetings are held between local management
and employees to allow a free flow of information and ideas. Employees are encouraged to invest in the
Group through participation in savings-related share options schemes.
Directors and their interests
The directors, who served throughout the year, at the date of this report are listed on page 2, with the
exception of Mr K M H Millar who retired from the Board on 24 January 2002.
In accordance with the Articles of Association of the Company, Mr H V Reid and Mr G W Harrison retire
from the Board at the Annual General Meeting by rotation and offer themselves for re-election. 12
ENTERPRISE INNS ANNUAL REPORT 2002
DIRECTORS’ REPORT
The interests of the directors in the share capital of the Company, other than with respect to options to
acquire ordinary shares (which are detailed in the report on directors’ remuneration), were as follows:
30 September 30 September
Ordinary Shares of 10 pence each 2002 2001 
H V Reid Beneficial 61,250 35,000
G E Tuppen Beneficial 590,000 469,160
as Trustee 90,976 86,376
D C George Beneficial 426,000 346,710
as Trustee 63,000 48,593
G W Harrison Beneficial 120,747 74,825
W S Townsend Beneficial 3,062 1,750
M F Garner Beneficial 16,373 9,356
A J Stewart Beneficial 3,500 —
The executive directors, along with other employees, have been granted options over the shares of the
Company. Details of these interests are disclosed in the report on directors’ remuneration.
There have been no changes in the interests of directors between the balance sheet date and the date
of approval of the accounts.
Notifiable interests in shares
As at 26 November 2002 the Company had been notified of the following material holdings of 3% or
more of the Company’s issued share capital:
Number of Percentage
Ordinary of Issued
Shares Share Capital
Morley Fund Management/AVIVA plc 8,434,765 5.0
Barclays PLC 5,096,269 3.0 13
ENTERPRISE INNS ANNUAL REPORT 2002
DIRECTORS’ REPORT
Creditors payment policy and practice
The Company agrees terms and conditions for its business transactions with suppliers. Payment is then
made in accordance with these terms, subject to the terms and conditions being met by the supplier.
At the year end the Company had an average of 32 days’ purchases outstanding in trade creditors.
Environment
Enterprise Inns recognises its responsibility to achieve good environmental practice and to continue to
strive for improvement in its environmental impact, and to work with its suppliers, contractors and
business partners to this end.
Enterprise Inns supports the “Public Places Charter” on smoking in public places.The Charter is a
voluntary code between the Department of Health and the leisure industry.Within our pubs, we are
committed, through an advisory programme, to inform our retail partners of the aims and objectives of
the charter and, by joint action with our partners, to provide appropriate solutions and signage to allow
customers to make informed decisions as to their preferred choice of venue.
Enterprise Inns also operates a no smoking policy within its head office workplace environment.
Statement of directors’ responsibilities
Company law requires the directors to prepare accounts for each financial year which give a true and
fair view of the state of affairs of the Company and of the Group and of the profit or loss of the Group
for that period. In preparing those accounts, the directors are required to:
 select suitable accounting policies and then apply them consistently;
 make judgements and estimates that are reasonable and prudent;
 state whether applicable accounting standards have been followed, subject to any material
departures disclosed and explained in the accounts.
The directors confirm that the accounts comply with the above requirements.
The directors are responsible for keeping proper accounting records which disclose with reasonable
accuracy at any time the financial position of the Group and to enable them to ensure that the accounts
comply with the Companies Act 1985.They are also responsible for safeguarding the assets of the Group
and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Auditors
A resolution to reappoint Ernst & Young LLP as the Group’s auditor will be put to the members at the
forthcoming Annual General Meeting.
On behalf of the Board
D C George
Secretary
26 November 2002 14
ENTERPRISE INNS ANNUAL REPORT 2002
CORPORATE GOVERNANCE
The Company is committed to high standards of corporate governance.The Board is accountable to the
Company’s shareholders for good corporate governance.The statement below describes how the
principles of corporate governance are applied to the Company and the Company’s compliance with
the Code provisions set out in Section 1 of the Combined Code prepared by the Committee on
Corporate Governance chaired by Sir Ronald Hampel.
Statement by the directors on compliance with the Code of Best Practice
The directors are pleased to report that the Company has been in full compliance with the provisions
set out in Section 1 of the Combined Code throughout the year.
The company’s Articles of Association provide for one-third of the directors to be subject to re-election
every year.The Board has determined that all directors are subject to re-election at least every
three years.
A statement of the directors’ responsibilities in respect of the accounts is set out on page 13. Below is a
brief description of the role of the Board and its committees followed by a statement regarding the
Group’s system of internal control and a statement on the business as a going concern.
The Workings of the Board and its committees
The Board
The Board currently comprises the independent non-executive chairman, the chief executive, three
executive directors and the two independent non-executive directors.These directors have been
identified in the biographical details on page 2.The Board is responsible to the shareholders for the
proper management of the Group. It meets on a regular basis to review trading performance, to set and
monitor strategy, and to examine major capital expenditure and acquisition opportunities.
The following committees deal with specific aspects of the Group’s affairs:
Audit Committee
The audit committee comprises Mr M F Garner, Mr H V Reid and Mr A J Stewart.The committee is
chaired by Mr M F Garner, and meets not less than twice annually.The committee provides a forum for
reporting by the Group’s auditors.The meetings are also attended by other directors by invitation.
The audit committee is responsible for reviewing a wide range of financial matters including the interim
and annual accounts prior to their submission to the Board, and monitoring the controls which are in
force to ensure the integrity of the financial information reported to the shareholders.The audit
committee advises the Board on the appointment of external auditors and on their remuneration and
discusses the nature and scope of their work.
Remuneration Committee
The remuneration committee comprises Mr A J Stewart, Mr H V Reid and Mr M F Garner.The committee is
chaired by Mr A J Stewart.The committee is responsible for determining the contract terms, remuneration
and other benefits for executive directors, including performance related bonus schemes.
The report of the remuneration committee, which includes details of directors’ remuneration and
directors’ interests in options, together with information on service contracts, is set out on pages 16 to 20.
Nomination Committee
The nomination committee comprises Mr H V Reid, Mr G E Tuppen, Mr M F Garner and Mr A J Stewart.
Mr H V Reid is chairman of the nomination committee.The committee is responsible for proposing
candidates for appointment to the Board, having regard to the balance and structure of the Board. 15
ENTERPRISE INNS ANNUAL REPORT 2002
CORPORATE GOVERNANCE
Relations with Shareholders
Communications with shareholders are given high priority.The operating and financial review on pages
3 to 10 includes a detailed review of the business and future developments.There is a regular dialogue
with institutional shareholders including presentations after the Company’s preliminary announcement
of the year end results and at the half year.
The Board uses the Annual General Meeting to communicate with private and institutional investors and
welcomes their participation.The chairman aims to ensure that the chairmen of the audit, remuneration
and nomination committees are available at Annual General Meetings to answer questions. Details of
resolutions to be proposed at the Annual General Meeting on Thursday, 23 January 2003 can be found in
the Notice of the meeting on pages 52 and 54.
Internal Control
The directors acknowledge that they are responsible for the Group’s systems of internal control and for
reviewing their effectiveness.
An ongoing process, in accordance with the guidance of the Turnbull Committee on internal control,
has been established for identifying, evaluating and managing risks faced by the Group.The risk
management process and systems of internal control are designed to manage rather than eliminate the
risk of failure to achieve the Group’s strategic objectives. It should be recognised that such systems can
only provide reasonable and not absolute assurance against material misstatement or loss.This process
has been in place since the start of the financial year and up to the date of approval of the accounts.The
Group’s associate,The Unique Pub Company Limited, has not been dealt with as part of the Group for
the purposes of applying the Turnbull Guidance.
The key procedures which the directors have established with a view to providing effective internal
control are as follows:
 Regular Board meetings to consider a schedule of matters reserved for directors’ consideration;
 The Board carries out an annual review of corporate strategy which includes a review of risks
facing the business, and how these risks are monitored and managed on an ongoing basis within
the organisation.This process is regularly reviewed by the Board;
 An established organisational structure with clearly defined lines of responsibility and delegation
of authority;
 Documented and enforced policies and procedures;
 Appointment of staff of the necessary calibre to fulfil their allotted responsibilities;
 Comprehensive budgets and forecasts, approved by the Board, reviewed and revised on a regular
basis, with performance monitored against them and explanations obtained for material
variances;
 A detailed investment approval process, requiring Board approval for major projects. Post-
investment appraisals are conducted and are reviewed by the Board;
 The audit committee of the Board, comprising non-executive directors, considers significant
financial control matters as appropriate.
The Board has reviewed the effectiveness of the system of internal control.This review included a
review of business risks at function level, and how these risks are managed and reported within the
organisation on an ongoing basis.
Going Concern
After making enquiries, the directors have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable future. For this reason they continue
to adopt the going concern basis in preparing the accounts. 16
ENTERPRISE INNS ANNUAL REPORT 2002
REPORT ON DIRECTORS’ REMUNERATION
Remuneration
The Company’s remuneration committee is chaired by Mr A J Stewart and its other members are Mr H V
Reid and Mr M F Garner.
The committee determines an overall remuneration package for executive directors in order to attract
and retain high quality executives capable of achieving the Company’s objectives.The package consists
of basic salary, benefits, pension contributions, and performance related bonuses, which are principally
share based, and are dependent on the achievement of demanding targets.The remuneration committee
takes advice as considered necessary from executive remuneration consultants, as regards salary and
benefits packages in other comparable circumstances.
The remuneration committee has followed the best practice provisions of Schedule A of the
Combined Code.
The remuneration of the individual directors was as follows:
Performance
Basic related Deferred Total Total
Fees salary Benefits bonus* bonus† Pension 2002 2001
£000 £000 £000 £000 £000 £000 £000 £000
H V Reid 120 — ———— 120 95
G E Tuppen — 347 14 104 69 87 621 451
D C George — 207 13 62 41 52 375 301
G W Harrison — 190 16 57 38 48 349 264
W S Townsend — 157 9 47 31 39 283 193
M F Garner 30————— 30 26
K M H Millar 10 — ———— 10 26
A J Stewart 30————— 30 9
190 901 52 270 179 226 1,818 1,365
* The bonus disclosed relates to the cash bonus awarded under the Enterprise Inns Incentive Plan.
† The deferred bonus disclosed relates to the value of shares awarded as short-term incentives for the
year under the Enterprise Inns Incentive Plan.
Awards of long-term share incentives made during the year under the Enterprise Inns Incentive Plan are
disclosed on pages 19 and 20.
The above pension contributions are amounts paid to the directors’ individual defined contribution
schemes.
Interests in options
The Company currently has two share option schemes by which executive directors and other
executives are able to acquire shares in the Company.The first is the Enterprise Inns Executive Share
Option Scheme: current policy is not to grant further options to executive directors under the scheme,
but options previously granted under this scheme are referenced (a) in the table below.The second is
the Enterprise Inns Savings Related Share Option Scheme and options granted under this scheme are
referenced (b) in the table below. 17
ENTERPRISE INNS ANNUAL REPORT 2002
REPORT ON DIRECTORS’ REMUNERATION
The interests of the directors were as follows:
SAYE Adjustment
Market At 1 New for At 30
price at date Exercise October awards Rights September
of exercise price 2001 granted Issue Exercised 2002
££
G E Tuppen (a) 6.63* 1.26 52,253 — — (52,253) —
(a) 5.90* 1.01 55,000 — 13,558 (68,558) —
(b) 2.49 5,409 — 1,333 — 6,742 
112,662 — 14,891 (120,811) 6,742 
D C George (b) 2.49 5,409 — 1,333 — 6,742
5,409 — 1,333 — 6,742 
G W Harrison (a) 1.01 119,169 — 29,376 — 148,545 
(b) 6.86‡ 1.78 1,928 — — (1,928) — 
(b) 2.49 4,327 — 1,067 — 5,394 
125,424 — 30,443 (1,928) 153,939 
W S Townsend (a) 3.25 30,683 — 7,563 — 38,246
(b) 2.49 2,163 — 533 — 2,696 
(b) 4.19 —1,898† 468 — 2,366 
32,846 1,898 8,564 — 43,308 
* G E Tuppen exercised options over 52,253 Ordinary Shares at £1.26 on 3 December 2001 resulting in
a gain of £281,000. G E Tuppen also exercised options over 68,558 Ordinary Shares at £1.01 on 5 June
2002 resulting in a gain of £335,000.Therefore the total gain on the exercise of Executive Share Options
in the year amounted to £616,000.
‡ G W Harrison exercised options over 1,928 Ordinary Shares at £1.78 on 12 February 2002 resulting in a
gain of £10,000.
The total aggregate gain of share options exercised was £626,000.
† granted 20 December 2001
The options are exercisable between the following dates:
(a) 3 November 1998 – 13 December 2009
(b) 1 January 2002 – 1 August 2006
The directors may only exercise options held under scheme (a) if the Company’s Earnings Per Share
(EPS) has increased by at least 6% above the increase in the Retail Price Index (RPI) over a period of
three financial years.
There are no performance criteria restricting the exercise of options held under the SAYE scheme,
scheme (b).
The market price of the Company’s shares on 30 September 2002 was 556.5 pence per share and the
high and low share prices during the year were 838.5 pence and 431.5 pence respectively.
The Company established an Employee Benefit Trust on 26 September 1996.As at 30 September 2001
the trust, which has been funded by a combination of loans and gifts from the Company, had purchased
an aggregate of 649,080 shares. Options over 138,475 shares were exercised on 3 December 2001.The
trust also subscribed for 382,953 new shares as a result of the rights issue.The cost of these purchases
was £1,578,000. It is intended that the balance of 893,558 shares held by the trust will be used to satisfy
future awards made under the Enterprise Inns Incentive Plans. 18
ENTERPRISE INNS ANNUAL REPORT 2002
REPORT ON DIRECTORS’ REMUNERATION
Enterprise Inns Incentive Plans
At the Annual General Meeting held on 21 January 1997 an ordinary resolution was passed adopting the
Enterprise Inns Incentive Plan (“the Plan”), which provide for participants to earn non-pensionable cash
bonuses and short-term and long-term incentives.The Plan rules recite the Company’s intention to
satisfy all share incentives awarded under the Plan using ordinary shares held in the Employee Benefit
Trust.
At the Annual General Meeting held on 24 January 2002 an ordinary resolution was passed adopting the
Enterprise Inns Incentive Plan 2002 (“the 2002 Plan”).The 2002 Plan has replaced the Plan and no
further awards are to be made under the Plan.The 2002 Plan also provides for participants to earn non-
pensionable cash bonuses and short-term and long-term share incentives will be satisfied using shares
held in the Employee Benefit Trust.
Non-pensionable cash bonuses
Under the terms of the Plan and the 2002 Plan, G E Tuppen, D C George, G W Harrison and
W S Townsend are entitled to an annual cash bonus expressed as a percentage of salary calculated by
reference to the growth in EPS.To qualify for any award, the growth of EPS must exceed the RPI by 2.5%
and to qualify for the maximum award of 30% of salary EPS growth must exceed the RPI by 15% in the
relevant financial year.Awards between the minimum and maximum limits are calculated on a straight-
line basis pro rata to the growth in EPS between the minimum and maximum targets.The cash bonus
awards for the year are shown in the remuneration table on page 16.
Short-Term Incentive
Under the terms of the Plan and the 2002 Plan the short-term incentive depends upon achievement of
annual growth in EPS measured against RPI.To qualify for any award, EPS growth must exceed RPI by
2.5%, and to qualify for the maximum award of 20% of salary, EPS must exceed RPI by 15%.Awards
between the minimum and maximum limits are calculated on a straight-line basis pro rata to the growth
in EPS between the minimum and maximum targets. Short-term incentives may not ordinarily be
exercised for 36 months after the end of the performance criteria period. During the year the EPS
exceeded RPI by 15% therefore the awards were granted.
Short-term awards granted under the Plan on 18 December 1997 were exercised by the directors as follows:
Market price Number of Aggregate
Date of at date of shares Gain
Exercise Exercise exercised £’000s
G E Tuppen 03/12/01 £6.63 11,070 73
D C George 03/12/01 £6.63 7,590 50
G W Harrison 03/12/01 £6.63 6,325 42
The short-term incentives awarded under the 2002 Plan on a conditional basis in the year are as follows:
Date Market value of
granted ordinary shares* Exercise period
G E Tuppen 16/04/02 £64,000 1/10/2005–16/04/12
D C George 16/04/02 £38,000 1/10/2005–16/04/12
G W Harrison 16/04/02 £35,000 1/10/2005–16/04/12
W S Townsend 16/04/02 £28,000 1/10/2005–16/04/12
* Market value is taken at the announcement date of results for the relevant year.
Short-term awards made under the Plan in the years 1998, 1999 and 2000 have become unconditional.
The number of shares awarded to the directors, and still outstanding, and the market value of such
shares at 30 September 2002 (556.5 pence per share) in respect of these awards are as follows:
Date Number of Market value
Granted shares £000 Exercise period
G E Tuppen 18/12/98 11,469 64 1/10/2002–18/12/2005
18/12/99 14,061 78 1/10/2003–18/12/2006
18/12/00 9,455 53 1/10/2004–18/12/2007
D C George 18/12/98 7,741 43 1/10/2002–18/12/2005
18/12/99 9,687 54 1/10/2003–18/12/2006
18/12/00 6,240 35 1/10/2004–18/12/2007 19
ENTERPRISE INNS ANNUAL REPORT 2002
REPORT ON DIRECTORS’ REMUNERATION
G W Harrison 18/12/98 6,882 38 1/10/2002–18/12/2005
18/12/99 8,438 47 1/10/2003–18/12/2006
18/12/00 5,483 31 1/10/2004–18/12/2007
W S Townsend 18/12/99 5,313 30 1/10/2003–18/12/2006
18/12/00 3,971 22 1/10/2004–18/12/2007
The number of shares has been adjusted to take account of the rights issue.
Long-Term Incentive 
Under the Plan, the long-term incentive awards ordinary shares to participants upon achievement of
compound growth in EPS measured against RPI over 3 years.To qualify for any award EPS must exceed
RPI over a three year period by 5% compound (15.76% simple), and to qualify for the maximum award
of 50% of salary (averaged over a three year period), EPS must exceed RPI over a three year period by
15% compound (52.09% simple).Awards between the minimum and maximum limits are calculated on a
straight-line basis pro rata to the growth in EPS between the minimum and maximum targets. Long-term
incentives may not ordinarily be exercised until 24 months after the end of the performance criteria
period. During the year the EPS exceeded RPI over the three year period to September 2002 by 15%
compound and, therefore, the awards made on 18 December 1999 will be granted in due course.
Under the 2002 Plan, the long-term incentive awards ordinary shares to participants upon achievement
of compound growth in EPS measured against RPI over 3 years.To qualify for any award EPS must
exceed RPI over a three year period by 5% compound (15.8% simple), and to qualify for the maximum
award of 100% of salary (averaged over a three year period), EPS must exceed RPI over a three year
period by 20% compound (72.8% simple).Awards between the minimum and maximum limits are
calculated on a straight-line basis pro rata to the growth in EPS between the minimum and maximum
targets. Long-term incentives may not ordinarily be exercised until 24 months after the end of the
performance criteria period.
The participants of the 2002 Plan will bear the cost of any income tax and any primary Class 1 or secondary
Class 1 national insurance contributions for which the company must account to the Inland Revenue.
Long-term awards granted under the Plan on 18 December 1997 were exercised by the directors as follows:
Market price Number of Aggregate
Date of at date of shares Gain
Exercise Exercise exercised £’000s
G E Tuppen 03/12/01 £6.63 50,137 333
D C George 03/12/01 £6.63 34,183 227
G W Harrison 03/12/01 £6.63 29,170 194
The long-term incentives awarded under the 2002 Plan on a conditional basis in the year are as follows:
Date Market value of Exercise 
granted ordinary shares period
G E Tuppen 16/04/02 up to 100% of salary † 1/10/2006–16/04/12
D C George 16/04/02 up to 100% of salary † 1/10/2006–16/04/12
G W Harrison 16/04/02 up to 100% of salary † 1/10/2006–16/04/12
W S Townsend 16/04/02 up to 100% of salary † 1/10/2006–16/04/12
† Salary is based on the average rate paid to the participant between 1 October 2001 and 30 September
2004. Market value is taken at the start of the incentive period (459.2 pence) as adjusted to take
account of the rights issue.
Details of long-term incentives awarded under the Plan on a conditional basis in previous years and
outstanding as at 30 September are as follows:
Date Market value of Exercise 
granted ordinary shares period
G E Tuppen 18/12/99 up to 50% of salary ‡ 1/10/2004–18/12/2006
D C George 18/12/99 up to 50% of salary ‡ 1/10/2004–18/12/2006
G W Harrison 18/12/99 up to 50% of salary ‡ 1/10/2004–18/12/2006
W S Townsend 18/12/99 up to 50% of salary ‡ 1/10/2004–18/12/2006 20
ENTERPRISE INNS ANNUAL REPORT 2002
REPORT ON DIRECTORS’ REMUNERATION
‡ Salary is based on the average rate paid to participants between 1 October 1999 and 30 September
2002. Market value is taken at the start of the incentive period (375.9 pence) as adjusted to take
account of the rights issue.
Date Market value of Exercise 
granted ordinary shares period
G E Tuppen 18/12/00 up to 50% of salary § 1/10/2005–18/12/2007
D C George 18/12/00 up to 50% of salary § 1/10/2005–18/12/2007
G W Harrison 18/12/00 up to 50% of salary § 1/10/2005–18/12/2007
W S Townsend 18/12/00 up to 50% of salary § 1/10/2005–18/12/2007
§ Salary is based on the average rate paid to participants between 1 October 2000 and 30 September
2003. Market value is taken at the start of the incentive period (265.8 pence) as adjusted to take
account of the rights issue.
The performance criteria periods for the 1997/8 and 1998/9 long-term incentives awarded under the
Plan have now ended and these awards have become unconditional.The number of shares awarded to
the directors and the market value of such shares at 30 September 2002 (556.5 pence per share) in
respect of these awards are as follows:
Date Number of Market value
Granted shares £000 Exercise period
G E Tuppen 18/12/97 50,753 282 1/10/02–18/12/04
18/12/98 57,028 317 1/10/03–18/12/05
D C George 18/12/97 34,682 193 1/10/02–18/12/04
18/12/98 38,441 214 1/10/03–18/12/05
G W Harrison 18/12/97 30,028 167 1/10/02–18/12/04
18/12/98 33,794 188 1/10/03–18/12/05
The number of shares has been adjusted to take account of the rights issue.
The value of the long-term share incentives accrued during the period in respect of awards made
relating to the current and previous years, and charged to the profit and loss account, under the
Enterprise Inns Incentive Plan are as follows:
2002 2001
£000 £000
G E Tuppen 247 161
D C George 148 107
G W Harrison 138 93
W S Townsend 122 30
655 391
Terms of appointment
The terms of appointment for Mr H V Reid, Mr M F Garner and Mr A J Stewart reflect best practice.Their
respective appointments shall continue on an annual basis from AGM to AGM, subject to re-election,
when applicable.
In the event of termination of his appointment, Mr H V Reid would be entitled to twelve months’ notice
and Mr M F Garner and Mr A J Stewart would each be entitled to six months’ notice.
The executive directors all have service contracts under which they are entitled to receive twelve
months’ notice of termination.
There are no special provisions in the executive directors’ contracts for compensation in the event of
loss of office.The remuneration committee would consider the circumstances of any individual case of
early termination and would determine compensation payments accordingly.A fair but robust principle
of mitigation would be applied to the payment of compensation in the context of professional advice
received as to contractual entitlement.
On behalf of the Board
A J Stewart
Chairman of the Remuneration Committee 21
ENTERPRISE INNS ANNUAL REPORT 2002
GROUP PROFIT AND LOSS ACCOUNT
for the year ended 30 September 2002
(As restated) 
2002 2002 2002 2002 2002 2001
Sub-total
Continuing Pre share of Share of
Operations Acquisitions* Associate Associate Total Total
Notes £m £m £m £m £m £m
Turnover 2 307.0 61.9 368.9 — 368.9 245.4
Cost of sales 3 (155.3) (26.2) (181.5) — (181.5) (136.0)
Gross Profit 151.7 35.7 187.4 — 187.4 109.4
Administrative expenses (17.5) (6.7) (24.2) — (24.2) (13.8)
Exceptional administrative expenses 4 — (8.5) (8.5) — (8.5) (19.9)
Other operating income 5 23.2 0.8 24.0 — 24.0 9.1
Group Operating Profit 6 157.4 21.3 178.7 — 178.7 84.8
Share of operating profit in associate — — — 16.8 16.8 —
Total Operating Profit 157.4 21.3 178.7 16.8 195.5 84.8
Net (loss)/profit on disposal of 
tangible fixed assets 7 (0.2) — (0.2) 0.2 — (0.5)
Profit on sale of fixed asset investments 7 ——— —— 0.3
Profit on Ordinary Activities 
Before Interest and Taxation 157.2 21.3 178.5 17.0 195.5 84.6
Interest receivable and similar income 5.1 — 5.1 0.6
Interest payable and similar charges 9 (80.2) (14.4) (94.6) (42.7)
Exceptional interest payable 
and similar charges 9 (7.6) (6.1) (13.7) (1.8)
(82.7) (20.5) (103.2) (43.9)
Profit on Ordinary Activities 
before Taxation 95.8 (3.5) 92.3 40.7
Tax on Profit on Ordinary Activities 10 (28.9) 0.7 (28.2) (14.4)
Profit on Ordinary Activities after 
Taxation and Attributable to Members
of the Parent Company 66.9 (2.8) 64.1 26.3
Ordinary dividends on equity shares 12 (20.5) — (20.5) (11.1)
Retained Profit for the Year 25 46.4 (2.8) 43.6 15.2
Earnings per share — basic 13 46.7p 24.3p
— adjusted 13 58.4p 39.5p
— diluted 13 46.2p 24.1p
* represents the acquisition of 1,860 pubs acquired from Laurel Pub Holdings Limited 22
ENTERPRISE INNS ANNUAL REPORT 2002
NOTE OF HISTORICAL COST PROFITS 
AND LOSSES
for the year ended 30 September 2002
GROUP STATEMENT OF TOTAL RECOGNISED
GAINS AND LOSSES
for the year ended 30 September 2002
(As restated)
2002 2001
£m £m
Profit for the financial year excluding share of associated undertakings 66.9 26.3
Share of loss in associated undertakings for the financial year (2.8) —
Profit for the financial year attributable to members of the parent company 64.1 26.3
Unrealised surplus on revaluation of licensed estate 13.7 12.0
Share of unrealised surplus on revaluation of licensed estate in associate 18.5 —
Total recognised gains and losses 96.3 38.3
Prior year adjustment (as explained in note 1) (26.7) —
Total recognised gains and losses since the last annual report 69.6 38.3
(As restated)
2002 2001
£m £m
Reported profit on ordinary activities before taxation 92.3 40.7
Realised deficits against historical costs on disposal of 
properties revalued in earlier years (7.5) (0.7)
Historical cost profit on ordinary activities before taxation 84.8 40.0
Historical cost profit for the year retained after taxation and dividends 36.1 14.5 23
ENTERPRISE INNS ANNUAL REPORT 2002
GROUP BALANCE SHEET
at 30 September 2002
(As restated)
2002 2001
Notes £m £m
Fixed assets
Intangible assets 14 48.8 —
Tangible assets 15 2,243.4 1,323.1
Investments 16 96.0 0.8
2,388.2 1,323.9
Current assets
Assets held for resale 17 7.7 16.4
Debtors 18 51.3 36.5
Cash at bank and in hand 0.9 9.5
59.9 62.4
Creditors: amounts falling due within one year 19 (223.6) (137.2)
Net current liabilities (163.7) (74.8)
Total assets less current liabilities 2,224.5 1,249.1
Creditors: amounts falling due after more than one year 20 (1482.6) (890.1)
Provision for liabilities and charges 21 (48.4) (35.9)
693.5 323.1
Capital and reserves
Called up share capital 24 17.0 9.7
Share premium account 25 432.3 145.0
Revaluation reserve 25 101.6 61.9
Capital redemption reserve 25 7.6 7.6
Merger reserve 25 77.0 77.0
Profit and loss account 25 58.0 21.9
Equity shareholders’ funds 693.5 323.1
Approved by the Board on 26 November 2002 and signed on its behalf by:
G E Tuppen
Directors
D C George
} 24
ENTERPRISE INNS ANNUAL REPORT 2002
BALANCE SHEET
at 30 September 2002
(As restated)
2002 2001
Notes £m £m
Fixed assets
Tangible assets 15 1,348.9 799.8
Investments 16 918.4 801.4
2,267.3 1,601.2
Current assets
Assets held for resale 17 6.8 7.8
Debtors 18 863.9 24.6
Cash at bank and in hand 0.9 9.3
871.6 41.7
Creditors: amounts falling due within one year 19 (1,077.2) (472.1)
Net current liabilities (205.6) (430.4)
Total assets less current liabilities 2,061.7 1,170.8
Creditors: amounts falling due after more than one year 20 (1,452.7) (890.1)
Provision for liabilities and charges 21 (41.8) (35.3)
567.2 245.4
Capital and reserves
Called up share capital 24 17.0 9.7
Share premium account 25 432.3 145.0
Revaluation reserve 25 83.1 61.9
Capital redemption reserve 25 7.6 7.6
Profit and loss account 25 27.2 21.2
Equity shareholders’ funds 567.2 245.4
Approved by the Board on 26 November 2002 and signed on its behalf by:
G E Tuppen
Directors
D C George
} 25
ENTERPRISE INNS ANNUAL REPORT 2002
GROUP STATEMENT OF CASH FLOWS
for the year ended 30 September 2002
2002 2001
Notes £m £m
Net Cash Inflow from operating activities 6 193.1 100.5
Return on investments and servicing of finance
Interest received 0.3 0.6
Interest paid (84.7) (38.2)
Issue costs of long-term loans (15.0) (11.7)
(99.4) (49.3)
Taxation (8.3) (6.0)
Capital expenditure and financial investment
Payments to acquire public houses (17.7) (59.0)
Payments made on improvements to public houses (16.5) (21.4)
Payments to acquire other fixed assets (10.6) (1.4)
Receipts from sales of tangible fixed assets and properties held for resale 25.0 12.9
Loans to associated undertakings (73.6) —
(93.4) (68.9)
Acquisitions and disposals
Purchase of subsidiaries 16 (34.4) (529.6)
Net cash acquired with subsidiaries 8.8 —
Expenses of acquisitions paid (3.1) (9.7)
Equity payment in associated undertakings (0.2) —
(28.9) (539.3)
Equity dividends paid (12.4) (9.2)
Cash outflow before financing (49.3) (572.2)
Financing
Issue of ordinary share capital 300.1 68.1
Share issue costs (5.6) (1.6)
Debt due within 1 year — new short-term loans 60.0 36.0
— repayment of short-term loans (879.7) (2.5)
Debt due beyond 1 year — new long-term loans 1,676.9 652.0
— repayment of long-term loans (1,111.0) (171.0)
40.7 581.0
(Decrease)/increase in cash 27 (8.6) 8.8
Reconciliation of net cash flow to movement in net debt
2002 2001
Notes £m £m
(Decrease)/increase in cash in the period 27 (8.6) 8.8
Cash outflow/(inflow) from change in debt 253.8 (514.5)
Issue costs of new long-term loans 15.0 11.7
Change in net debt resulting from cash flows 260.2 (494.0)
Acquired with subsidiaries (877.3) —
Amortisation of issue costs of long-term loans (3.5) (1.3)
Write-off of unamortised finance costs (7.6) (1.6)
Movement in net debt in the period (628.2) (496.9)
Net debt at 1 October 27 (917.3) (420.4)
Net debt at 30 September 27 (1,545.5) (917.3) 26
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
1 Accounting Policies
Basis of preparation
The accounts are prepared under the historical cost convention as modified to include the revaluation of
properties and have been prepared in accordance with applicable accounting standards.
Prior year adjustment
From 1 October 2001 the Group has adopted FRS 19: Deferred Tax which requires full provision to be
made for deferred tax arising from timing differences between the recognition of gains and losses in the
financial statements and their recognition in the tax computation. In adopting FRS 19, the Group has
chosen not to discount deferred tax assets and liabilities.
The comparative figures for 2001 have been restated to reflect the impact of FRS 19. Consequently,
shareholders’ funds for the Group have been reduced by £26.7 million to reflect the recognition of the
net provision of deferred tax, net of a reduction in current taxation liabilities of £9.2 million to avoid the
double recognition of certain potential tax liabilities now included within the deferred tax provision.
The impact of FRS 19 has also been to increase the tax charge and reduce the profit after tax by £5.9m for
the current financial year.The restated comparatives for the prior year have the effect of increasing the tax
charge by £4.5m and reducing the profit after tax by the same amount. Last year’s deferred tax liability has
been restated as £35.9m from nil as originally reported.
The impact on reserves at 1 October 2000 is £22.2m and the impact on the Profit and Loss Account for
the year ended 30 September 2001 is £4.5m.
Basis of consolidation
The Group accounts consolidate the accounts of Enterprise Inns plc and all its subsidiary undertakings
drawn up to 30 September each year. No profit and loss account is presented for Enterprise Inns plc as
permitted by Section 230 of the Companies Act 1985.
The Group profit and loss account and cash flow statement include the results and cash flows of each
acquisition from the date on which control passes to the Group.
Undertakings, other than subsidiary undertakings, in which the Group has an investment and over which
it is in a position to exercise a significant influence are treated as associated undertakings.The Group
accounts include the appropriate share of Warwickshire Hotels Limited and The Unique Pub Company
Limited (previously Coinmajor Limited) results and reserves.
Interest rate swaps
The Group’s criteria for accounting for interest rate swaps as hedges are:
— The instrument must be related to an asset or a liability; and
— It must change the character of the interest rate by converting a variable rate to a fixed rate or vice
versa.
Interest differentials are recognised by accruing with net interest payable. Interest rate swaps are not
revalued to fair value or shown on the Group balance sheet at the year end. If they are terminated early,
the gain/loss is spread over the remaining maturity of the original instrument.
Goodwill
Goodwill represents the excess of consideration over the fair value of identifiable net assets acquired.
Goodwill arising on acquisitions prior to 1 October 1998 was written off against reserves. Goodwill
previously eliminated against reserves has not been reinstated on implementation of FRS 10.
Positive goodwill arising on acquisitions since 1 October 1998 is capitalised, classified as an asset on the
Balance Sheet and amortised on a straight line basis over its useful economic life up to a presumed
maximum of 20 years. It is reviewed for impairment at the end of the first full financial year following the
acquisition and in other periods if events or changes in circumstances indicate that the carrying value may
not be recoverable.
If a subsidiary is subsequently sold, any goodwill arising on acquisition that was written off directly to
reserves or that has not been amortised through the Profit and Loss Account is taken into account in
determining the profit or loss on disposal. 27
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
Tangible fixed assets and depreciation 
Expenditure on additions and improvements to tangible fixed assets is capitalised as the expenditure is
incurred.
Substantially all of the Group’s licensed estate are valued each year reflecting their trading potential on an
existing use basis. Surpluses arising from the professional valuation of the licensed estate are taken direct
to the revaluation reserve.Valuation surpluses realised on sale are transferred from the revaluation reserve
to the profit and loss account reserve.Any deficit arising from the professional valuation of properties is
taken direct to the revaluation reserve until the carrying amount reaches historical cost and, thereafter, to
the extent that the value in use can be demonstrated to be higher than valuation.Any other deficit arising
is charged to the profit and loss account.
It is the Company’s policy to maintain the properties comprising the licensed estate in such a condition that
the residual values of the properties, based on prices prevailing at the time of acquisition or subsequent
revaluation, are at least equal to their book values. Having regard to this, it is the opinion of the directors that
depreciation of any such property as required by the Companies Act 1985 and generally accepted
accounting practice would not be material.An annual impairment review is carried out on such properties.
Short leasehold properties, defined as properties with 50 years or less of the lease remaining unexpired,
are depreciated on a straight-line basis over the unexpired lease term. Depreciation is provided on all
other categories of tangible fixed assets over 3 to 5 years on a straight-line basis.
Leasing and hire purchase commitments
Rentals paid under operating leases are charged to the profit and loss account on a straight line basis over
the lease term.
Assets held for resale
Assets held for resale are stated at the lower of cost incurred and net realisable value. Net realisable value
is based on estimated selling price less further costs expected to be incurred on disposal.
Deferred taxation
The charge for taxation is based on the profit for the year and takes into account taxation deferred
because of timing differences between the treatment of certain items for taxation and accounting
purposes.
FRS 19 ’Deferred Taxation’ was issued on 7 December 2000 and is mandatory for years ending on or after
23 January 2002.
Deferred taxation is recognised in respect of all timing differences that have originated but not reversed at
the balance sheet date where transactions or events that result in an obligation to pay more, or a right to
pay less, tax in the future have occurred at the balance sheet date, with the following exceptions:
Provision is made for gains on disposal of fixed assets that have been rolled over into replacement assets
only where, at the balance sheet date, there is a binding commitment to dispose of the replacement assets
with no likely subsequent rollover or available capital losses.
Provision is made for deferred tax on gains on revalued fixed assets only where there is a commitment to dispose
of the revalued assets and the attributable gain can neither be rolled over or eliminated by capital losses.
Deferred tax assets are recognised only to the extent that the directors consider that it is more likely than
not that there will be suitable taxable profits from which the future reversal of the underlying timing
differences can be deducted.
Deferred tax is measured on an non-discounted basis at the tax rates that are expected to apply in the
periods in which timing differences reverse, based on tax rates and laws enacted or substantively enacted
at the balance sheet date.
Pensions
The Group makes contributions to employees’ own pension plans in accordance with the terms of their
contracts of employment. 28
ENTERPRISE INNS ANNUAL REPORT 2002
2 Turnover
Turnover represents the amounts derived from the provision of goods and services which fall within the
Group’s ordinary activities, stated net of value added tax.
The Group operates in one principal area of activity, that of a public house landlord.This operation takes
place solely in the United Kingdom.
A substantial proportion of turnover is attributable to rents receivable from the licensed estate.Turnover is
derived as follows:
2002 2002 2002 2001
Continuing
Operations Acquisitions Total
£m £m £m £m
Beer and cider sales 224.3 37.4 261.7 153.2
Wines, spirits and minerals sales 18.3 3.2 21.5 8.0
Rents receivable from licensed estate 61.4 21.2 82.6 37.3
Sales to customers by managed houses 3.0 0.1 3.1 46.9
307.0 61.9 368.9 245.4
Following the acquisition of 1,860 pubs from Laurel Pub Holdings Limited on 24 May 2002, these pubs
have been integrated within the existing operations of Enterprise Inns plc.
3 Cost of sales
2002 2002 2002 2001
Continuing
Operations Acquisitions Total
£m £m £m £m
Beer and cider cost of sales 125.2 22.3 147.5 87.1
Wines, spirits and minerals cost of sales 15.7 3.0 18.7 7.2
Leasehold charges 4.3 0.2 4.5 3.0
Cost of sales by managed houses 3.4 — 3.4 35.9
Repairs and maintenance 6.7 0.7 7.4 2.8
155.3 26.2 181.5 136.0
NOTES TO THE ACCOUNTS
at 30 September 2002 29
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
4 Exceptional administrative expenses
2002 2001
£m £m
Redundancy and similar costs 2.6 12.1
Management fees relating to the conversion period 0.3 5.3
Termination of contract costs 3.3 —
Professional fees 1.1 —
Other 1.2 2.5 
8.5 19.9 
The exceptional administrative expenses relate to costs incurred in integrating the operations of the
current year acquisition with the existing operations and systems of Enterprise Inns plc. Expenses incurred
in 2001 related to the integration of 439 pubs from MGPE and 431 pubs acquired from Scottish and
Newcastle plc.
5 Other operating income
2002 2002 2002 2001
Continuing
Operations Acquisitions Total
£m £m £m £m
Property income other than rent from 
the licensed estate 0.7 — 0.7 0.3
Income from amusement and other machines 22.5 0.8 23.3 8.8
23.2 0.8 24.0 9.1 30
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
6 Operating profit
(a) This is stated after charging:
2002 2001
£m £m
Auditors’ remuneration — audit fees 0.2 0.1
— non-audit fees 0.2 0.1
Amortisation of goodwill 0.9 —
Depreciation of owned fixed assets 0.9 0.8
Amortisation of short leasehold properties 0.7 0.5
Provision against fixed asset investment 1.2 —
Operating lease rentals — buildings 3.3 2.5
In addition to the above, a further £0.2 million was paid to the auditors during the year for professional
services in connection with the acquisition of Laurel Pub Holdings Limited.This has been included in the
cost of acquisition.
(b) Reconciliation of operating profit to net cash inflow from operating activities:
2002 2001
£m £m
Operating profit 178.7 84.8
Depreciation and amortisation 2.5 1.3
Provision against fixed asset investments 1.2 0.4
(Increase)/decrease in debtors (1.1) 0.9
Increase in creditors 0.4 14.5
(Increase)/decrease in assets held for resale 11.4 (1.4)
Net cash inflow from operating activities 193.1 100.5
Cash outflows in respect of exceptional administrative expenses were £8.7m (2001 — £15.0m).
7 Exceptional items — net profit/(loss) on the disposal of fixed assets
2002 2001
£m £m
Profits on disposal of tangible fixed assets 8.7 4.0
Losses on disposal of tangible fixed assets (3.8) (3.3)
Provision for loss on disposal of fixed assets (5.1) (1.2)
Net loss on disposal of tangible fixed assets (0.2) (0.5)
Profit on sale of fixed asset investments — 0.3
Share of profit on disposal of tangible fixed assets in associate 0.2 —
— (0.2)
There is no taxation effect of the exceptional items. 31
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
8 Staff costs
2002 2002 2002 2001
Continuing
Operations Acquisitions Total
£m £m £m £m
Wages and salaries 10.7 1.7 12.4 17.8
Social security costs 1.3 0.3 1.6 1.7
Other pension costs 0.9 — 0.9 0.6
12.9 2.0 14.9 20.1
The average monthly number of employees during the year was 422 (2001 — 2,143).This comprised an
average of 321 (2001 — 156) employees of the Company and a number of retail staff in acquired
subsidiary undertakings.
Details of directors’ remuneration are set out on pages 16 to 20.
9 Interest payable and similar charges
2002 2001
£m £m
Bank loans and overdrafts 43.8 23.3
Loan notes — 0.1
Debentures/secured bonds 31.7 17.6
Other interest payable and finance costs 1.2 0.3
Amortisation of issue costs of debt instruments 3.5 1.4
80.2 42.7
Share of interest payable in associate 14.4 —
Exceptional finance costs 7.6 1.8
Share of exceptional finance costs in associates 6.1 —
13.7 1.8
The exceptional finance costs relate to the write-off of unamortised finance costs following the
refinancing of senior debt facilities upon the acquisition of 1,860 pubs from Laurel Pub Holdings Limited. 32
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
10 Taxation
(As restated)
2002 2001
Analysis of tax charge in the current year £m £m
The charge based on profit for the year comprises:
UK Corporation tax 23.0 6.3
Share of associate’s current tax (0.7) —
Total current tax 22.3 6.3
UK deferred tax 5.9 8.1
Tax on profit on ordinary activities 28.2 14.4
The deferred tax charge arises in respect of the origination and reversal of timing differences.
(As restated)
2002 2001
Factors affecting the tax charge for the year: £m £m
Profit on ordinary activities before tax 92.3 40.7
Profit on ordinary activities before tax at 30% (2001 — 30%) 27.7 12.2
Effects of:
Expenses not deductible for tax purposes 2.7 2.2
Tax allowances in excess of depreciation (5.9) (8.1)
Utilisation of tax losses (2.2) —
Current tax on profit on ordinary activities 22.3 6.3
Factors that may effect future tax charges
The Group expects a reduced current tax charge in the year to September 2003 due to the realisation of a
loss on the interest rate swap acquired with The Laurel Pub Group Limited, the tax benefit of which is
currently recognised as a deferred tax item. It is also expected that the agreement of the tax computations
for certain prior years will result in a release of amounts previously provided and therefore a one-off
reduction in the overall tax charge.
No provision has been made for deferred tax on gains recognised on the revaluation of fixed assets or on
the sale of properties where potentially taxable gains have been rolled over into replacement assets. Such
tax would become payable only if the property were sold without it being possible to claim rollover relief.
The total amount not provided for is £8.5m (2001 — £8.5m).At present, it is not envisaged that any tax
will become payable in the foreseeable future.
11 Profit attributable to members of the parent company
The profit after tax dealt with in the accounts of the parent company was £34.0m (2001 — £22.4m
restated for FRS 19 Deferred Tax). Retained profit for the year amounted to £13.5m (2001 — £11.2m
restated for FRS 19 Deferred Tax).
12 Dividends
2002 2001
£m £m
Equity dividends on ordinary shares:
Interim paid 4.7 pence (2001 — 4.1 pence) 4.5 3.3
Final proposed 9.4 pence (2001 — 8.2 pence) 16.0 7.8
20.5 11.1 33
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
13 Earnings per ordinary share
The calculation of basic earnings per ordinary share is based on earnings of £64.1m (2001 — £26.3m) and
on 137,229,769 (2001 — 108,121,168) shares being the weighted average number of equity shares in issue
during the year after excluding shares held by trusts relating to employee share options.The weighted
average number of shares for 2001 has been restated to adjust for the bonus factor relating to the rights
issue during May 2002. Earnings for 2001 have been adjusted to reflect the provision of deferred taxation.
Adjusted earnings per share, which reflects the underlying performance of the Group, is based on earnings
adjusted for the effects of exceptional items, net of tax, of £80.1m (2001 — £42.7m) and on 137,229,769
(2001 — 108,121,168) shares being the weighted average number of equity shares in issue during the year
after excluding shares held by trusts relating to employee share options.The weighted average number of
shares for 2001 has been restated to adjust for the bonus factor relating to the rights issue during
May 2002.
(As restated)
2002 2001
Basic earnings are adjusted as follows: £m £m
Profit after tax 64.1 26.3
Exceptional administrative costs 8.5 19.9
Exceptional finance costs 13.7 1.8
Non-operating exceptional costs — 0.2
Taxation impact of exceptional costs (6.2) (5.5)
Adjusted Earnings 80.1 42.7 
The diluted earnings per share is based on profit for the year of £64.1m (2001 — £26.3m), and on
138,724,179 (2001 — 109,011,665) ordinary shares, calculated as follows:
2002 2001
Basic weighted average number of shares 137,229,769 108,121,168
Dilutive potential ordinary shares:
Executive share option plan 599,622 289,132
Enterprise Inns Quest sharesave scheme 241,323 107,045
Long-term and Short-term Incentive plans 653,465 494,320
138,724,179 109,011,665
14 Intangible fixed assets
Group Company
Goodwill £m £m
Cost:
Acquisition of subsidiary undertaking (see note 16) 49.7 —
At 30 September 2002 49.7 —
Amortisation:
Provided during the year (0.9) —
At 30 September 2002 (0.9) —
Net book value at 30 September 2002 48.8 —
Goodwill arising on the acquisition of The Laurel Pub Group Limited is being amortised evenly over the
directors’ estimate of its useful economic life of 20 years. 34
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
15 Tangible fixed assets
Licensed premises
Long Short
Freehold leasehold leasehold Other
properties properties properties assets Total
Group £m £m £m £m £m
Cost or valuation:
At 1 October 2001 1,204.3 100.1 16.5 5.7 1,326.6
Reclassification 1.4 (0.7) (0.7) — —
Additions 34.7 0.9 0.3 10.7 46.6
Acquisition of subsidiary undertakings 848.3 37.9 2.8 — 889.0
Provision for loss on disposal (2.4) (0.8) (0.9) — (4.1)
Revaluations 13.2 0.5 — — 13.7
Fair value review of prior year acquisitions 1.8 (3.4) (1.1) — (2.7)
Disposals (15.3) (1.7) (0.6) (5.2) (22.8)
At 30 September 2002 2,086.0 132.8 16.3 11.2 2,246.3
Depreciation:
At 1 October 2001 — — 1.6 1.9 3.5
Charge for the year — — 0.7 0.9 1.6
Disposals — — (0.2) (2.0) (2.2)
At 30 September 2002 — — 2.1 0.8 2.9
Net book value:
At 30 September 2002 2,086.0 132.8 14.2 10.4 2,243.4
At 30 September 2001 1,204.3 100.1 14.9 3.8 1,323.1
Company
Cost or valuation:
At 1 October 2001 737.1 49.7 11.3 5.2 803.3
Reclassifications (1.9) 1.9———
Additions 23.1 0.5 — 10.6 34.2
Assets hived-up from subsidiary 
undertakings 475.3 44.3 3.6 0.5 523.7
Provision for loss on disposal (2.4) (0.8) (0.9) — (4.1)
Revaluations 13.2 0.5 — — 13.7
Disposals (11.8) (1.4) (0.6) (5.2) (19.0)
At 30 September 2002 1,232.6 94.7 13.4 11.1 1,351.8
Depreciation:
At 1 October 2001 — — 1.6 1.9 3.5
Charge for the year — — 0.5 0.9 1.4
Assets hived-up from subsidiary 
undertakings — — 0.2 — 0.2
Disposals — — (0.2) (2.0) (2.2)
At 30 September 2002 — — 2.1 0.8 2.9
Net book value:
At 30 September 2002 1,232.6 94.7 11.3 10.3 1,348.9
At 30 September 2001 737.1 49.7 9.7 3.3 799.8 35
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
15 Tangible fixed assets (continued)
(a) Assets held for use by lessees under operating leases are detailed below.
Group Company
£m £m
At 30 September 2002
Gross Book Value 2,093.5 1,216.7
Accumulated Depreciation (1.5) (1.5)
Net Book Value 2,092.0 1,215.2
At 1 October 2001
Gross Book Value 1,019.4 656.0
Accumulated depreciation (0.3) (0.3)
Net Book Value 1,019.1 655.7
(b) Licensed premises additions of 1,860 pubs arising on the acquisition of The Laurel Pub Group Limited
have been included at their cost to the Group. Individual licensed properties acquired during 2001 and
2002 have also been included at cost.The directors are not aware of any material change in the value of
these assets at the year end.
With the exception of properties identified for disposal, other licensed premises of the Group were
valued at their existing use value by Humberts Leisure Limited, external Chartered Surveyors, as at
30 September 2002. Properties identified for disposal are valued by Christie & Co., external Chartered
Surveyors, at their open market value for sale.
The net book value of licensed premises comprises:
Group Company
2002 2001 2002 2001
£m £m £m £m
Licensed estate at valuation:
Freehold properties 897.7 619.6 897.7 619.6
Long leasehold properties 49.9 47.5 49.9 47.5
Short leasehold properties 1.9 1.2 1.9 1.2
949.5 668.3 949.5 668.3
Licensed estate at cost:
Freehold properties 1,188.3 584.6 335.0 117.4
Long leasehold properties 82.9 52.6 44.8 2.3
Short leasehold properties 12.3 13.8 9.3 8.6
1,283.5 651.0 389.1 128.3
2,233.0 1,319.3 1,338.6 796.6
The historical cost and net book value of the licensed premises included at valuation is as follows:
Group & Company
Long Short
Freehold leasehold leasehold
properties properties properties
£m £m £m
At 30 September 2002 821.5 42.9 2.0
At 30 September 2001 563.1 42.1 1.2
(c) If all the properties were sold at their valuation, no net tax liability would arise. 16 Investments
Investment in
Own associated
shares undertaking Loans to
(listed) (unlisted) associates Total
Group £m £m £m £m
Cost:
At 1 October 2001 2.0 0.2 — 2.2
Acquisitions — 0.2 74.8 75.0
Additions 2.0 — 3.7 5.7
Disposals (0.4) — — (0.4)
Share of loss in associate — (2.8) — (2.8)
Share of revaluation of licensed estate in associate — 18.5 — 18.5
At 30 September 2002 3.6 16.1 78.5 98.2
Provision:
At 1 October 2001 1.4 — — 1.4
Provision for directors’ entitlements earned but not
crystallising until future years 1.2 — — 1.2
Disposals (0.4) — — (0.4)
At 30 September 2002 2.2 — — 2.2
Net book value:
At 30 September 2002 1.4 16.1 78.5 96.0
Net book value:
At 30 September 2001 0.6 0.2 — 0.8
Associated
Own undertakings
shares shares Subsidiary Loans to
(listed) (unlisted) undertakings associates Total
Company £m £m £m £m £m
Cost:
At 1 October 2001 2.0 — 800.8 — 802.8
Acquisitions — 0.2 — 74.8 75.0
Additions 2.0 — 37.5 3.7 43.2
Disposals (0.4) — — — (0.4)
At 30 September 2002 3.6 0.2 838.3 78.5 920.6
Provision:
At 1 October 2001 1.4 — — — 1.4
Provision for directors’ entitlements earned 
but not crystallising until future years 1.2 — — — 1.2
Disposals (0.4) — — — (0.4)
At 30 September 2002 2.2 — — — 2.2
Net book value:
At 30 September 2002 1.4 0.2 838.3 78.5 918.4
Net book value:
At 30 September 2001 0.6 — 800.8 — 801.4
36
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002 NOTES TO THE ACCOUNTS
at 30 September 2002
16 Investments (continued)
Details of the investments in which the Group or the Company holds more than 20% of the nominal value
of any class of share capital are as follows. Due to the large number of bodies now falling within this
criteria, only the undertakings whose results or financial position principally affect the accounts are shown,
as allowed under s231 of the Companies Act.
Country of Proportion
registration of voting
(or incorporation) rights and Nature of
Name of company and operation Holding shares held business
Subsidiary undertakings:
Directly held by Enterprise Inns plc:
Enterprise Pubs Two Ltd England Ordinary 100% Acquisition 
shares and
management
of freehold
and leasehold
licensed
properties
Enterprise Pubs Four Ltd England Ordinary/ 100% Acquisition 
Preference and
shares management
of freehold
and leasehold
licensed
properties
Indirectly held by Enterprise Inns plc:
Enterprise Pubs Seven Ltd England Ordinary 100% Acquisition 
shares and
management
of freehold
and leasehold
licensed
properties
Associated undertakings:
Directly held by Enterprise Inns plc:
The Unique Pub Company Ltd England Ordinary 16.8% Management
(previously Coinmajor Ltd) shares of freehold
and leasehold
licensed 
properties
Warwickshire Hotels Ltd England Ordinary 50% Management
shares of freehold
and leasehold
licensed 
properties
37
ENTERPRISE INNS ANNUAL REPORT 2002 38
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
16 Investments (continued)
The investment in own shares comprises Enterprise Inns plc ordinary shares set aside in respect of the
Enterprise Inns Incentive Plan and the Company’s savings related share option scheme.The shares are held
either by the Enterprise Inns Employee Share Trust or by Enterprise Inns QUEST.At 30 September 2002, the
number of ordinary shares held totalled 1,163,723 (2001 — 822,153).The cost of investment in own shares
in respect of the Enterprise Inns Incentive Plans is being amortised over the relevant performance period
set out within the plan rules.The market value of Enterprise Inns plc ordinary shares at 30 September 2002
was 556.5 pence per share, and the market value of this listed investment was £6.5 million.
The dividends attaching to the shares held by the Trust Funds have been waived.
On 24 May 2002, the Company acquired The Laurel Pub Group Limited for a consideration of £37.5m
including acquisition expenses.
Analysis of the acquisition of The Laurel Pub Group Limited
The net assets at the date of acquisition are analysed as follows:
Fair
Book Adjustments value to
value Revaluation Other the Group
£m £m £m £m
Intangible fixed assets 208.2 (208.2) (a) — —
Tangible fixed assets 648.8 240.2 (a) — 889.0
Assets held for resale 1.4 — (0.2) (c) 1.2
Debtors 17.4 — (1.4) (c) 16.0
Cash 8.8 — — 8.8
Creditor due within one year (36.6) — (9.5) (b) (46.1)
Creditors due after more than one year (843.5) — (31.0) (b) (874.5)
Deferred taxation (20.5) — 13.9 (c) (6.6)
Net assets (16.0) 32.0 (28.2) (12.2)
Goodwill 49.7
Total cash consideration 37.5
(a) The licensed premises of The Laurel Pub Group Limited were valued by the directors at their open
market value for existing use on the date of acquisition. Intangible assets have been reclassified into
the valuation of the pub estate.
(b) Two swaps with an underlying notional principal of £550m and £250m were valued by JC Rathbones
Associate Limited.The valuations were based on the mid-market swap rates prevailing at 11.00 am on
24 May 2002.
(c) Reassessment of assets and liabilities existing in the Group at the date of acquisition.
The cash flows in respect of the purchase of this company are as follows: £m
Cash paid to acquire The Laurel Pub Group Limited 34.4
Expenses of acquisition paid 3.1
Net cash flow on acquisition* 37.5
* cash acquired on acquisition amounted to £8.8m. 39
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
16 Investments (continued)
The total cash consideration of £37.5m is before the repayment of debt of £843.5m.Therefore, total cash
outflow on acquisition is £881m.
The contributions of the acquisitions to the Group Statement of Cash flows have not been disclosed
separately, as it is not practicable, due to the integration of pubs into the existing estate.
Analysis of the acquisition of 16.8% of The Unique Pub Company Limited
On 20 March the Group acquired a 16.8% share of a newly formed company,The Unique Pub Company
Limited (previously Coinmajor Limited), for a consideration of £75.0m which represents the fair value of
the assets acquired.
The total investment of £75m to acquire a 16.8% share of The Unique Pub Company Limited is analysed as
follows: £m
Share capital 0.2
Deep discounted bonds 74.8
Total cash consideration 75.0 
The cash flows in respect of the acquisition of this company are as follows: £m
Cash paid to acquire a 16.8% share of The Unique Pub Company Limited 75.0
Additional disclosures are given in respect of the Company’s investment in The Unique Pub Company
Limited as at 30 September 2002, which exceeds certain thresholds under FRS 9 ‘Associate and Joint
Ventures’.The disclosures are taken from the unaudited management accounts of The Unique Pub Company
Limited as follows:
Total Enterprise share
100% 16.8%
Balance Sheet £m £m
Intangible fixed assets (106.4) (17.9)
Fixed assets 2,190.1 368.0
Current assets 221.3 37.2
Share of gross assets 2,305.0 387.3
Liabilities due within one year (82.9) (13.9)
Liabilities due after more than one year (2,127.7) (357.5)
Share of gross liabilities (2,210.6) (371.4)
Share of net assets 94.4 15.9
Profit and Loss Account £m £m
Turnover 278.0 46.7
Operating profit 99.9 16.8
Loss before taxation (20.5) (3.5)
Taxation 4.3 0.7
Loss after taxation (16.2) (2.8) 40
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
17 Assets held for resale
Group Company
2002 2001 2002 2001
£m £m £m £m
Fixtures and fittings and stock purchased
from tenants 7.7 16.4 6.8 7.8
18 Debtors
Group Company
2002 2001 2002 2001
£m £m £m £m
Amounts falling due within one year:
Trade debtors 36.5 23.2 23.8 17.6
Other debtors 2.1 5.6 — 0.5
Prepayments and accrued income 7.5 4.6 4.3 3.4
Amounts owed by subsidiary undertakings — — 832.3 —
46.1 33.4 860.4 21.5
Amounts falling due after more than one year:
Trade debtors 4.8 2.8 3.1 2.8
Other debtors 0.4 0.3 0.4 0.3
51.3 36.5 863.9 24.6
19 Creditors: amounts falling due within one year
Group Company
2002 2001 2002 2001
(As restated) (As restated)
£m £m £m £m
Loans — secured 63.3 36.0 60.0 36.0
Loan Notes 0.5 0.7 0.5 0.7
Trade creditors 11.8 5.3 7.7 4.1
Mainstream corporation tax 24.2 9.5 20.3 9.5
Other creditors including taxation
and social security 41.1 23.2 34.2 19.4
Accruals and deferred income 66.7 54.7 46.7 42.4
Proposed dividend 16.0 7.8 16.0 7.9
Amounts due to subsidiary undertakings — — 891.8 352.1
223.6 137.2 1,077.2 472.1
20 Creditors: amounts falling due after more than one year
Group Company
2002 2001 2002 2001
£m £m £m £m
Loans (note 23) — secured 905.0 584.3 875.1 584.3
Debentures — secured 577.6 305.8 577.6 305.8
1,482.6 890.1 1,452.7 890.1 41
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
21 Provisions for liabilities and charges
Group Company
Deferred Tax £m £m
At 1 October 2001 (as restated) 35.9 35.3
Deferred tax charge in the profit and loss account 5.9 3.6
Balance transferred on the hive up of subsidiaries — 2.9
Acquisition of subsidiary undertaking 6.6 —
Provision at 30 September 2002 48.4 41.8
The major components of the amounts provided are as follows:
Group Company
(As restated) (As restated)
2002 2001 2002 2001
Deferred Tax £m £m £m £m
Accelerated capital allowances 62.4 35.9 41.8 35.3
Short-term timing differences (14.0) — — —
Provision for deferred tax 48.4 35.9 41.8 35.3
The amounts of deferred tax not provided in the accounts are as follows:
Group Company
(As restated) (As restated)
2002 2001 2002 2001
£m £m £m £m
Rolled over gains 8.5 8.5 8.5 8.5
Revaluation of fixed assets — — — —
Deferred tax not provided 8.5 8.5 8.5 8.5
No provision has been included in respect of capital gains on the disposal of properties that have already
been deferred, or are expected to be deferred, though the application of capital gains rollover relief into
replacement assets as no liability is expected to arise.
No deferred tax has been recognised in respect of the unrealised surplus on the revaluation of fixed assets as
there was no binding commitment to sell the properties at the balance sheet date. 42
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
22 Financial Instruments
The Group’s financial instruments, other than derivatives, comprise borrowings and cash.The main purpose
of these financial instruments is to raise finance for the Group’s operations. Details of the Group’s debt
facilities are given on pages 44 and 45.All financial instruments are denominated in Sterling.The disclosures
below exclude short-term debtors and creditors.
The Group also enters into derivatives transactions.The purpose of such transactions is to manage the
interest rate risks arising from the Group’s sources of finance.
It is, and has been throughout the period under review, the Group’s policy that no speculative trading in
financial instruments shall be undertaken.
The main risks arising from the Group’s financial instruments are interest rate risk and liquidity risk.There is
no currency exposure as all transactions are in sterling.The Board reviews and agrees policies for managing
each of these risks and they are summarised below.
Interest rate risk
The Group finances its operations through a mixture of retained profits and bank borrowings.The Group
borrows at both fixed and floating rates of interest.The cash balance attracts interest at a floating rate.The
Group’s policy is to review levels of hedging on a regular basis.At the year end 74 per cent of the Group’s
borrowings were at fixed interest rates (2001 — 33%).
The interest rate profile of financial liabilities of the Group at 30 September 2002 was as follows:
Fixed rate Floating rate
financial financial
Total liabilities liabilities
£m £m £m
2002
Sterling 1,528.3 1,135.0 393.3
2001
Sterling 939.7 310.0 629.7
Book value
2002 2001
£m £m
Book value of fixed rate financial liabilities 1,135.0 310.0
Weighted average period of fixed interest rate financial liabilities 16.8 years 19.7 years
Weighted average interest rate of fixed rate financial liabilities 6.95% 6.71%
Liquidity risk
As regards liquidity, the Group’s policy has been throughout the year to review the maturity of the Group’s
funding on a regular basis.At the year end 38 per cent of the Group’s borrowings were due to mature in
more than five years. Short-term flexibility is achieved by overdraft facilities. 43
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
22 Financial Instruments (continued)
The fair values of financial assets and liabilities are as follows:
2002 2002 2001 2001
Book Value Fair Value Book Value Fair Value
£m £m £m £m
Senior Debt and Loan Notes (945.5) (945.5) (629.7) (629.7)
Debenture — issued 3 February 1999
(less discounts) (59.4) (56.7) (59.4) (59.4)
Secured bond — issued 9 May 2000
(less discounts) (125.0) (129.0) (125.0) (125.0)
Secured bond — issued 15 February 2001
(less discounts) (124.1) (130.4) (124.1) (124.1)
Secured bond — issued 26 February 2002
(less discounts) (273.9) (270.1) ——
Cash 0.9 0.9 9.5 9.5
Interest rate caps (0.1) — (0.1) —
Loans to Associates 75.2 75.2 0.3 0.3
Sub-total (1,451.9) (1,455.6) (928.5) (928.4)
£550m interest rate swap 
expiring 1 June 2012 (33.1) (68.7) ——
(1,485.0) (1,524.3) (928.5) (928.4)
Book value and fair value are both stated gross of unamortised issue costs. See note 23 (a).
Gains and losses on instruments used for hedging are not recognised until the exposure that is being
hedged itself is recognised.The unrecognised loss on financial instruments used for hedging at
30 September 2002 is £35.6m (2001 — nil). 44
ENTERPRISE INNS ANNUAL REPORT 2002
23 Loans
Group & Company
2002 2001
£m £m 
(a) Details of loans are as follows:
Senior debt finance
Revolving loan repayable in full on 23 May 2007. Interest is payable at LIBOR
(plus mandatory costs) plus a margin which is capped at 1.8%.The Company 
is currently paying a margin of 180 basis points. 145.0 —
Term loan repayable by six-monthly instalments, the first instalment to be paid on
31 March 2003.The instalments vary over the period of the loan but result in
repayment by 23 May 2007. Interest is payable at LIBOR (plus mandatory costs)
plus a margin which is capped at 1.8%.The Company is currently paying a margin 
of 180 basis points. 400.0 —
Term loan repayable in full on 31 March 2003 but with an option to extend the
repayment date to 23 November 2003. Interest is payable at LIBOR (plus mandatory
costs) plus a margin which is capped at 1.8%.The Company is currently paying a 
margin of 180 basis points. 200.0 —
Term loan repayable in full on 31 March 2004 but with an option to extend the
repayment date to 30 September 2004. Interest is payable at LIBOR (plus mandatory
costs) plus a margin which is capped at 1.8%.The Company is currently paying a 
margin of 180 basis points. 200.0 —
Revolving loan. — 104.0
Term loan. — 525.0
945.0 629.0
Senior debt issue costs (9.5) (8.7)
935.5 620.3
6% debenture repayable by 3 February 2014 60.0 60.0
Discount on the issue of debenture (0.6) (0.6)
Debenture issue costs (0.5) (0.5)
Loan notes — unsecured to be repaid at par on 1 October 2003 unless
repayment is requested earlier by noteholders under the conditions
of the loan notes. Interest is payable at 1% below six month LIBOR. 0.5 0.7
6.875% secured bonds repayable on 9 May 2025 125.0 125.0
Secured bonds issue costs (1.1) (1.1)
6.875% secured bonds repayable on 15 February 2021 125.0 125.0
Discount on the issue of debenture (0.9) (0.9)
Secured bonds issue costs (1.1) (1.1)
6.375% secured bonds repayable on 26 September 2031 275.0 —
Discount on the issue of debenture (1.1) —
Secured bonds issue costs (2.4) —
Sub-total 1,513.3 926.8
£550m interest rate swap expiring on 1 June 2012
Coupon 5.75% until 1 December 2004, thereafter 6.66159% until 1 June 2012 33.1 —
1,546.4 926.8
NOTES TO THE ACCOUNTS
at 30 September 2002 45
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
23 Loans (continued)
The debenture issued on 3 February 1999 is secured by fixed charges over 333 properties created in a trust
deed dated 3 February 1999.
The secured bonds issued on 9 May 2000 are secured by fixed charges over 659 properties created in a
trust deed dated 9 May 2000.
The secured bonds issued on 15 February 2001 are secured by fixed charges over 395 properties created in
a trust deed dated 15 February 2001.
The secured bonds issued on 26 February 2002 are secured by fixed charges over 886 properties created in
a trust deed dated 26 February 2002
The senior loan is secured by a security deed dated 23 May 2002 entered into by substantially all the
companies which comprise the Group giving the lenders a floating charge over all of the assets and
undertakings of such Group companies (whatsoever and wheresoever both present and future).The
floating charge ranks subsequent to the fixed charges created by the debenture and the secured bonds.
The £550 million swap expires on 1 June 2012.The coupon rate is 5.75% until 1 December 2004, thereafter
6.66159% until expiry.
(b) Amounts at 30 September 2002 (including overdrafts) fall due as follows:
2002 2001
£m £m
In more than five years 593.3 307.4
In more than two years but not more than five years 430.8 284.9
In more than one year but not more than two years 458.5 297.8
In one year or less, or on demand 63.8 36.7
Total 1,546.4 926.8
(c) Details of undrawn committed borrowing facilities available at 30 September 2002 are as
follows:
2002 2001
£m £m
Expiring after two years 55.0 46.0
55.0 46.0
(d) Interest rate hedging arrangements:
The Group is party to three interest rate cap agreements:
A cap of 8% on £5m for a term of seven years ending on 31 December 2003.
A cap of 8% on £3m for the term of six years nine months ending on 31 March 2004.
A cap of 8.25% on £6m for the term of seven years three months ending on 30 September 2004. 46
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
24 Share capital 
Allotted, Allotted,
called up and called up and
Authorised fully paid Authorised fully paid
2002 2002 2001 2001
No. £m No. £m
Ordinary Shares of 10p each 250,000,000 17.0 136,377,330 9.7
The total number of allotted, called up and fully paid shares at 30 September 2002 was 169,747,478 (2001
— 96,741,285).
During May 2002, the Company issued 72,714,073 Ordinary Shares with an aggregate nominal value of
£7,271,407 for a consideration of £4.12 per share, pursuant to a three for four rights issue to existing
shareholders.
Under the Executive Share Option Scheme 292,120 shares were issued at an average price of £1.87
per share.
The Company has two share option schemes under which options to subscribe for the Company’s shares
have been granted to certain directors and employees.At 30 September 2002 the following options were
outstanding:
Number Subscription
of shares Exercise Date price (£)
Executive Share Option Scheme 148,545 Between 1998 and 2005 1.01
Executive Share Option Scheme 21,944 Between 1999 and 2006 1.75
Executive Share Option Scheme 19,634 Between 2000 and 2007 1.91
Executive Share Option Scheme 123,478 Between 2001 and 2008 2.80
Executive Share Option Scheme 393,291 Between 2002 and 2009 3.25
Executive Share Option Scheme 448,118 Between 2003 and 2010 3.40
Executive Share Option Scheme 721,756 Between 2004 and 2011 5.16
Savings Related Share Option Scheme 48,272 Between 2001 and 2003 0.80
Savings Related Share Option Scheme 76,586 Between 2003 and 2005 1.54
Savings Related Share Option Scheme 54,363 Between 2004 and 2006 2.03
Savings Related Share Option Scheme 67,024 Between 2005 and 2007 2.81
Savings Related Share Option Scheme 104,929 Between 2006 and 2008 2.49
Savings Related Share Option Scheme 77,535 Between 2007 and 2009 4.19
Options have been adjusted, where appropriate, to take account of rights issues. Such adjustments have
been approved by the Inland Revenue.
The SAYE scheme is Inland Revenue approved and the Company has taken advantage of the exemption
from applying UITF17 (revised).
Directors’ contingent rights to shares are shown in the report on Directors’ Remuneration on pages 16
to 20. 47
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
25 Reserves
Share Capital Profit
premium Revaluation redemption Merger and loss
account reserve reserve reserve account
Group £m £m £m £m £m
At 1 October 2001
(as previously stated) 145.0 61.9 7.6 77.0 48.6
Prior year adjustment
(see note 1) ———— (26.7)
At 1 October 2001 restated 145.0 61.9 7.6 77.0 21.9
Transfer of realised
revaluation deficit — 7.5 — — (7.5)
Retained profit for the year———— 43.6
Premium on issue
of shares 287.3————
Surplus on revaluation
of estate — 13.7———
Share of associate surplus
on revaluation of estate — 18.5 — ——
At 30 September 2002 432.3 101.6 7.6 77.0 58.0
The cumulative amount of goodwill written off to reserves at 30 September 2002 is as follows:
2002 2001
£m £m
Positive goodwill 9.8 9.8
Negative goodwill (7.4) (7.4)
2.4 2.4
Share Capital Profit
premium Revaluation redemption and loss
account reserve reserve account
Company £m £m £m £m
At 1 October 2001 (as previously stated) 145.0 61.9 7.6 47.9
Prior year adjustment (see note 1) — — — (26.7)
At 1 October 2001 restated 145.0 61.9 7.6 21.2
Transfer of realised revaluation deficit — 7.5 — (7.5)
Retained profit for the year — — — 13.5
Premium on issue of shares 287.3———
Surplus on revaluation of estate — 13.7 — —
At 30 September 2002 432.3 83.1 7.6 27.2
There is no tax liability arising on the revaluation surplus of £13.7m. 48
ENTERPRISE INNS ANNUAL REPORT 2002
NOTES TO THE ACCOUNTS
at 30 September 2002
26 Reconciliation of movements in shareholders’ funds
2002 2001
(As restated)
£m £m
Total recognised gains and losses 96.3 38.3
Dividends (20.5) (11.1)
75.8 27.2
New share capital subscribed 7.3 1.4
Premium on issue of shares 287.3 65.1 
Net addition to shareholders’ funds 370.4 93.7
Opening shareholders’ funds 323.1 229.4
Closing shareholders’ funds 693.5 323.1
27 Notes to the statement of cash flows
Analysis of net debt
At Other At
1 October non-cash 30 September
2001 Cash flow movements 2002
£m £m £m £m
Cash at bank and in hand 9.5 (8.6) — 0.9
Cash 9.5 (8.6) — 0.9
Short-term loans (36.7) 819.7 (846.8) (63.8)
Long-term loans (890.1) (550.9) (41.6) (1,482.6)
(917.3) 260.2 (888.4) (1,545.5)
28 Capital commitments
Amounts contracted for but not provided in the accounts amounted to £3.1m for the Group and Company
(2001 — £2.8m).
29 Other financial commitments
At 30 September 2002 the Company had annual commitments under non-cancellable operating leases as set
out below:
Land and Buildings
2002 2001
£m £m
Operating leases which expire:
within one year 0.3 0.2
within two to five years 0.3 0.2
in over five years 2.6 2.2
3.2 2.6 49
ENTERPRISE INNS ANNUAL REPORT 2002
REPORT OF THE AUDITORS
REPORT OF THE AUDITORS TO THE MEMBERS OF ENTERPRISE INNS plc
We have audited the Group’s financial statements for the year ended 30 September 2002 which comprise the
Group Profit and Loss Account, Group Statement of Total Recognised Gains and Losses, Note of Historical Cost
Profit and Losses, Group Balance Sheet, Balance Sheet, Group Statement of Cash flows and the related notes 1
to 29.These financial statements have been prepared on the basis of the accounting policies set out therein.
Respective responsibilities of directors and auditors
The directors’ responsibilities for preparing the Annual Report and the financial statements in accordance with
applicable United Kingdom law and accounting standards are set out in the Statement of Directors’
Responsibilities.
Our responsibility is to audit the financial statements in accordance with the relevant legal and regulatory
requirements, United Kingdom Auditing Standards and the Listing Rules of the Financial Services Authority.
We report to you our opinion as to whether the financial statements give a true and fair view and are properly
prepared in accordance with the Companies Act 1985.We also report to you if, in our opinion, the directors’
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 the information
specified by law or the Listing Rules regarding directors’ remuneration and transactions with the Group is not
disclosed.
We review whether the Corporate Governance Statement reflects the Company’s compliance with the seven
provisions of the Combined Code specified for our review by the Listing Rules, 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 effectiveness of the Group’s corporate governance procedures or its risk
and control procedures.
We read other information contained in the Annual Report and consider whether it is consistent with the
audited financial statements.This other information comprises the Chairman’s Statement, Chief Executive’s
Review, Finance Director’s Report, Directors’ Report, Corporate Governance Statement and Report on
Directors’ Remuneration.We consider the implications for our report if we become aware of any apparent
misstatements or material inconsistencies with the financial statements. Our responsibilities do not extend to
any other information.
Basis of audit opinion
We conducted our audit in accordance with United Kingdom Auditing Standards issued by the Auditing
Practices Board.An audit includes examination, on a test basis, of evidence relevant to the amounts and
disclosures in the financial statements. 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 policies are appropriate to the Group’s circumstances, 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 assurance that the
financial statements are free from material misstatement, whether caused by fraud or other irregularity or
error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the
financial statements.
Opinion
In our opinion the financial statements give a true and fair view of the state of affairs of the Company and of
the Group at 30 September 2002 and of the profit of the Group for the year then ended and have been
properly prepared in accordance with the Companies Act 1985.
Ernst & Young LLP
Registered Auditor
Birmingham
26 November 2002
49
ENTERPRISE INNS ANNUAL REPORT 1997 50
ENTERPRISE INNS ANNUAL REPORT 2002
FIVE YEAR RECORD
Consolidated Profit and Loss Accounts
Year ended 30 September
2002 2001 2000 1999 1998
£m £m £m £m £m
Turnover 368.9 245.4 172.1 123.6 80.8
Operating Profit 178.7 84.8 70.2 47.9 30.6
Profit on ordinary activities before tax 92.3 40.7 44.1 31.4 19.2
Profit after tax* 64.1 26.3 30.2 15.6 11.2
Profit retained for the period* 43.6 15.2 21.3 7.0 5.5
Adjusted earnings per share (pence)† 58.4 39.5 31.5 19.0 16.1
* Restated to take account of FRS 19: Deferred Tax
† Restated to take account of the rights issue and FRS 19: Deferred Tax
Consolidated Balance Sheets
Fixed assets 2,388.2 1,323.9 717.4 567.9 288.2
Current assets 59.9 62.4 41.2 35.9 19.3
Creditors due within one year* (223.6) (137.2) (83.4) (78.1) (50.1)
Total assets less current liabilities* 2,224.5 1,249.1 675.2 525.7 257.4
Creditors due after more than one year*(1,531.0) (926.0) (445.7) (307.5) (136.6)
Net assets* 693.5 323.1 229.5 218.2 120.8
* Restated to take account of FRS 19: Deferred Tax 51
ENTERPRISE INNS ANNUAL REPORT 2002
ANALYSIS OF ORDINARY SHAREHOLDERS
FINANCIAL CALENDAR
Interim Final
Announcement of results and ordinary dividend declaration May November
Interim statement and report and accounts posted to shareholders May December
On record for dividends June December
Annual General Meeting January
Dividend payment July January
Number of Shares
Range Shareholders % Held %
1–1000 807 40.0 360,180 0.2
1001–10,000 727 36.1 2,127,150 1.3
10,001–50,000 210 10.4 5,046,457 3.0
50,001–100,000 79 3.9 5,819,869 3.4
100,001–150,000 34 1.8 4,137,219 2.4
150,001–500,000 92 4.6 25,562,722 15.1
500,001–1,000,000 31 1.5 21,851,288 12.9
1,000,001–5,000,000 31 1.5 76,313,618 45.0
5,000,001 and over 4 0.2 28,528,975 16.7
2,015 100.0 169,747,478 100.0 52
ENTERPRISE INNS ANNUAL REPORT 2002
NOTICE OF MEETING
Notice is hereby given that the Annual General
Meeting of Enterprise Inns plc will be held at the
offices of the Company, Enterprise Inns plc,
3 Monkspath Hall Road, Solihull,West Midlands,
B90 4SJ at 11.00 a.m. on Thursday, 23 January 2003
for the following purposes:
1. To receive and adopt the Directors’ Report
and the audited financial statements for the
year ended 30 September 2002.
2. To declare a final dividend.
3. To re-elect Mr H V Reid as a director of the
Company.
4. To re-elect Mr G W Harrison as a director of
the Company.
5. To reappoint Messrs Ernst & Young LLP as
auditors and to authorise the directors to fix
the remuneration of the auditors.
Ordinary Resolution
To consider and, if thought fit, to pass the following
resolution which will be proposed as an ordinary
resolution:
6. THAT the directors be and are hereby
generally and unconditionally authorised (in
substitution for all subsisting authorities to
the extent unused) pursuant to and in
accordance with section 80 of the Companies
Act 1985 (the “Act”) to allot relevant
securities (as defined in that section) up to an
aggregate nominal amount of £5,658,249
provided that this authority shall expire,
unless previously renewed, revoked or varied
by the Company in general meeting, fifteen
months after the passing of this resolution, or,
if earlier, at the conclusion of the Annual
General Meeting next following the passing
of this resolution save that, before such
expiry, the Company may make any offer or
agreement which would or might require
relevant securities to be allotted after such
expiry and notwithstanding such expiry, the
directors may allot relevant securities in
pursuance of any such offer or agreement.
Special Resolutions
To consider and, if thought fit, to pass the following
resolutions which will be proposed as special
resolutions:
7. THAT, subject to the passing of resolution 6,
the directors be and they are hereby
empowered pursuant to section 95 of the Act
to allot equity securities (within the meaning
of section 94 of the Act) for cash pursuant to
the authority conferred by the previous
resolution as if section 89(1) of the 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 an issue or offer by
way of rights or other pre-emptive
issue open for acceptance for a period
fixed by the directors, to holders of
ordinary shares on the register on any
record date fixed by the directors in
proportion to their holdings of
ordinary shares (subject to such
exclusions or other arrangements as
the directors may deem necessary or
expedient in relation to fractional
entitlements or legal or practical
problems arising under the laws of, or
the requirements of, any regulatory
body or stock exchange in any
territory or otherwise howsoever); and
(b) to the allotment, otherwise than
pursuant to sub-paragraph (a) above,
of equity securities having, in the case
of relevant shares, an aggregate
nominal value or, in the case of other
equity securities, giving the right to
subscribe for or convert into relevant
shares having a nominal sum not
exceeding in aggregate the sum of
£848,737,
and shall expire, unless previously renewed,
revoked or varied by the Company in general
meeting, at such time as the general authority
conferred on the directors by resolution 6
expires, save that, before the expiry of such
power, the Company may make any offer or
agreement which would or might require
equity securities to be allotted after such
expiry and the directors may allot equity 53
ENTERPRISE INNS ANNUAL REPORT 2002
NOTICE OF MEETING
securities in pursuance of such an offer or
agreement as if the power conferred hereby
had not expired.
8 THAT the Company be authorised to make
market purchases (as defined in section 163
of the Act) in accordance with the provisions
of section 166 of the Act of up to 25,445,146
ordinary shares of 10 pence each in the
capital of the Company at prices not less than
10 pence per share nor more than a price per
share being not more than 5% above the
average of the middle market quotations
taken from the London Stock Exchange Daily
Official List for the five business days before
the purchase is made, such authority to
expire on the date being eighteen months
after the date of this resolution, or, if earlier, at
the conclusion of the Annual General Meeting
of the Company in 2004 but so that the
Company may, pursuant to the authority
granted by this resolution, enter into a
contract to purchase such shares which
would or might be executed wholly or partly
after such expiry.
By order of the Board Registered Office:
D C George 3 Monkspath Hall Road
Secretary Solihull
26 November 2002 West Midlands
B90 4SJ 
Notes
1. A shareholder entitled to attend and vote at
the meeting may appoint one or more
proxies to attend and (on a poll) vote instead
of him.A proxy need not be a shareholder of
the Company.
2. The form of proxy and power of attorney or
other authority (if any) under which it is
signed, or a notarially certified copy of such
power of attorney, must be deposited at the
offices of the Company’s registrars,
Computershare Investor Services PLC,
Registrar’s Department, PO Box 1075,
The Pavilions, Bridgwater Road, Bristol,
BS99 3FA, by not later than 11.00 a.m. on
Tuesday 21 January 2003.A form of proxy is
set out at the end of this document for use by
shareholders.
3. Completion and return of a form of proxy
will not preclude a shareholder from
attending and voting at the meeting.
4. Copies of the directors’ service contracts and
the register of directors’ shareholdings are
available for inspection during usual business
hours on any weekday (public holidays
excepted) at the Company’s registered office
and they will also be available at the place of
the Annual General Meeting from fifteen
minutes prior to the meeting until its close.
5. As permitted by Regulation 41 of the
Uncertificated Securities Regulations 2001,
only those shareholders who are registered
on the Company’s share register at 11.00 a.m.
on Tuesday 21 January 2003, shall be entitled
to attend the Annual General Meeting and
vote in respect of the number of shares
registered in their names at that time.
Changes to entries on the share register after
11.00 a.m. on Tuesday 21 January 2003 shall
be disregarded in determining the rights of
any person to attend and/or vote at the
Annual General Meeting.
To Birmingham
To Solihull
Approx
1/2 mile
A34
J4 J5 J6
M42
To Stratford
Upon Avon
Enterprise Inns plc
3 Monkspath Hall Road
M42
M40
To London
South
Birmingham
International Airport
& Railway Station
NEC
Light refreshments (tea, coffee and biscuits) will
be available prior to the meeting. 54
ENTERPRISE INNS ANNUAL REPORT 2002
EXPLANATORY NOTES TO THE NOTICE
OF ANNUAL GENERAL MEETING
The notice of the Annual General Meeting to be held
on Thursday, 23 January 2003 is set out on pages 52
and 53.The following notes provide an explanation
as to why the resolutions set out in the notice are to
be put to shareholders.
Resolution 1
— Adoption of accounts
English company law requires the directors present
the accounts to a general meeting of the
shareholders.
Resolution 2
— Declaration of final dividend
An interim dividend of 4.7 pence (net) has already
been paid in respect of the 2001/2002 financial year.
The directors are recommending a final dividend of
9.4 pence (net) per ordinary share, payable on
24 January 2003 to shareholders on the register as at
31 December 2002.The final dividend will not be
paid without shareholder approval.
Resolutions 3 and 4 
— Re-election of directors
Under the Company’s Articles of Association, one-
third of the directors must retire each year although
they may offer themselves for re-election.
Accordingly, Mr H V Reid and Mr G W Harrison are
retiring and seeking re-election.
Resolution 5
Auditors
By this resolution, the Company’s auditors, Ernst &
Young LLP , seek reappointment and the directors are
seeking shareholder approval to determine the
amount of their fees.
Resolution 6
— Authority to the directors to allot shares
Under the Companies Act 1985 (section 80), the
directors of a company may only allot shares if
authorised to do so.This resolution gives the
directors authority to allot shares. Passing this
resolution will continue the directors’ flexibility to
act in the best interests of shareholders, when
opportunities arise, by issuing new shares.The
directors will be able to issue new shares up to a
nominal value of £5,658,249, which is equal to
approximately one-third of the issued share capital
of the Company as at the date of this Notice.
Resolution 7
— Disapplication of statutory pre-emption
rights
This resolution contains an authority for the
directors to allot shares without regard to the
statutory pre-emption rights in relation to future
offers of securities, and for issues of up to 5 per cent
of the amount of the issued share capital of the
Company as at the date of this Notice.The directors
consider this necessary in order to give them
flexibility to deal with opportunities as they arise,
subject to the restrictions as contained in the
resolution.
Resolution 8 
— Purchase of own shares by the Company
This resolution grants the Company authority for a
period of up to 18 months to buy its own shares in
the market, limits the number of shares which could
be purchased to up to 14.99 per cent of its issued
share capital and sets minimum and maximum
prices.This authority would only be exercised if
market conditions made it advantageous to do so.
The effect of any such purchases would be to reduce
the number of shares in issue and the directors
would accordingly make such purchases after
considering the effect on earnings per share and the
benefits for shareholders generally.As was the case in
the previous financial year, the Company has decided
to obtain maximum flexibility by seeking to buy up
to 14.99 per cent of its issued share capital. NO. RESOLUTIONS FOR AGAINST
1. To receive and adopt the Directors’ Report and
the audited financial statements for the year ended
30 September 2002.
2. To declare a final dividend.
3. To re-elect Mr H V Reid as a director.
4. To re-elect Mr G W Harrison as a director.
5. To reappoint Ernst & Young LLP as auditors and
to authorise the directors to fix their remuneration.
6. To give authority to the directors to allot shares.
7. To approve the disapplication of statutory pre-emption rights.
8. To authorise the directors to approve purchases of
own shares by the Company.
FORM OF PROXY
I/We ..........................................................................................................................................................................
(FULL NAME IN BLOCK CAPITALS)
of...............................................................................................................................................................................
being (a) member(s) of Enterprise Inns plc hereby appoint the Chairman of the meeting (see Notes 1 and 2) or 
..................................................................................................................................................................................
as my/our own proxy to vote in my/our name(s) and on my/our behalf at the Annual General Meeting of the
Company to be held on Thursday, 23 January 2003 and at any adjournment thereof.
Please indicate with a cross in the relevant box how you wish your votes to be cast. On receipt of
this Form of Proxy duly signed but without specific directions, the proxy will vote or abstain at
his discretion.
Signature(s) ............................................................................. Dated .....................................................2003
.............................................................................
NOTES
1. A shareholder who wishes to appoint a proxy of his own choice should delete the words “the Chairman of the meeting” and
complete, in the space provided above, the name and address of the person so appointed.
2 Any alteration to this form of proxy should be initialled.
3. To be valid, this form of proxy and the power of attorney or other authority (if any) under which it is signed, or a notarially certified
copy of such power or authority, must be deposited at the office of the registrars of the Company, Computershare Investor Services
PLC, PO Box 1075,The Pavilions, Bridgwater Road, Bristol, BS99 3FA, by not later than 11.00 a.m. on 21 January 2003.
4. In the case of joint holders, this form of proxy may be signed by any one of such joint holders, but the names of all the joint
holders must be stated.The vote of the senior who tenders a vote, whether in person or by proxy, will be accepted to the
exclusion of the votes of the other joint holders and, for this purpose, seniority will be determined by the order in which the
names stand in the register of members in respect of the joint holding.
5. If the shareholder is a corporation, this form of proxy should be executed either under its common seal or under the hand of
its attorney or an officer duly authorised for that purpose.
6. The completion and return of this form of proxy will not prevent a shareholder from attending the meeting and voting in person.
✄ 55
ENTERPRISE INNS ANNUAL REPORT 2002 BUSINESS REPLY SERVICE
Licence No. SWB 1002
Computershare Investor Services PLC
PO Box 1075
BRISTOL
BS99  3FA
Second fold
Third fold
and tuck in flap opposite
First fold
2 2 Castle, Tonbridge
Acquired in 2001, the Castle is situated on Tonbridge High
Street and faced stiff competition from several branded
managed houses. Over £100,000 has been invested to
create a light stylish venue, with the result that beer
volumes have more than doubled since the refurbishment.
Ruby Lounge, London
The London Bar Company created the Ruby bar concept
and have three Enterprise sites in central London. The Ruby
Lounge is the latest addition to their portfolio,where a
£200,000 refurbishment scheme has transformed this
former karaoke bar into a highly popular music and DJ
venue.
Mayflower, Lymington
Forming part of the Laurel Pub Partnerships acquisition, the
Mayflower occupies a superb location in Lymington Yacht
Haven. Under licensee Chris Troup, the pub has undergone a
£250,000 transformation to create a high quality bar and
restaurant with six en-suite rooms.Turnover has more than
doubled since the refurbishment.
Saxon, Shirley
Five minutes from our head office, this former Scottish & Newcastle
(originally Greenalls) community pub has been completely
refurbished and upgraded, to build on the hugely popular local
franchise developed by ex-managers and licensees, Malcolm and
Gerry Robinson.
Airman, Feltham
A former managed house, the Airman is now being operated
by the Top Dog Pub Company on a 21 year lease. Following
a major refurbishment at their own expense,Top Dog have
created a high quality community local which is proving
highly successful.
The Company continues to
invest substantial capital,
alongside our licensees, to
further enhance the estate
quality. Enterprise Inns plc
3 Monkspath Hall Road,
Solihull,West Midlands, B90 4SJ
Tel: +44 (0)121 733 7700
Fax: +44 (0)121 733 6447
www.enterpriseinns.com