tribal group plc report and accounts 2006
services for life when tribal group was established in 1999
our vision was to build a business that would
make a difference to the quality and delivery of
public services and through them make a
difference to people’s lives and life chances
today thanks to our 2300 talented and
committed staff we have together created
something of which we can be very proud
and we are truly carrying out our vision every
day we are helping to regenerate communities
raise standards in schools and colleges
improve housing and treat patients in hospital
services that matter to everyone services for life 
contents
01 highlights of the year
02 chairman’s statement
04 chief executive’s statement
14 business review
• our strategy
• our markets
• our people
• risk management and key 
performance indicators
• financial review
• corporate responsibility
30 board of directors
33 directors’ report
34 corporate governance
37 remuneration report
41 statement of directors’ responsibilities
42 independent auditors’ report to the 
members of tribal group plc
43 consolidated financial statements and notes
71 five year summary
72 uk gaap tribal group plc  
company financial statements
80 company information design and production by accrue
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Summary:
 chairman’s statement
i am pleased to report on the results of tribal
group plc for the year ended 31 march 2006 this
has been a successful period for the group during
which we have further strengthened our position as
a leading professional support services and
consultancy business predominantly operating in
the uk public sector 
during the year the group has generated strong
organic growth through its core consultancy and
support services businesses in education local
government housing and regeneration health
and social care and central government and has
successfully developed its healthcare delivery
business mercury health
we have delivered strong turnover growth for the
year up 13 per cent at £2599m 2005
£2295m operating profit was £241m 2005
£223m and operating margins were 112 per
cent 2005 124 per cent profit before tax was
up 67 per cent at £190m 2005 £178m profit
after tax was £128m 2005 £36m and
adjusted diluted earnings per share were 172p
2005 153p 
during the year the group generated free cash
flow of £191m 2005 £29m representing an
operating profit to cash conversion rate of 123
per cent 2005 60 per cent net debt at the year
end was £759m including the nonrecourse
mercury health project debt of £202m our
gearing was 47 per cent and our interest cover
was 47 times at 31 march 2006 the group’s
committed revenue was £333m
note the operating profit operating
margins profit before tax and adjusted
diluted earnings per share are stated before
goodwill impairment of £nil 2005 £67m
intangible asset amortisation of £03m
2005 £03m share option costs of £04m
2005 £01m ias 3239 finance costs of
£08m 2005 £nil and exceptional bid costs
of £nil 2005 £17m see page 43
consolidated income statement and 
page 52 earnings per share note
02 tribal group plc   report and accounts 2006
operating structure
we now have three reporting segments
consulting services education and technology
services and healthcare delivery within this
structure we have continued to strengthen
management and financial reporting
arrangements and have further invested in our
business development teams we are seeing
significant benefits from an ever strengthening
tribal brand and from offering a more integrated
package of services across our customer base
our ability to do this will increasingly differentiate
tribal from other competitors in our markets
opening up more opportunities and increasing
barriers to entry
mercury health
during the year the major focus for mercury
health was the implementation of the £214m
contract we signed with the nhs in december
2004 to design build and manage a regional
network of treatment centres for elective surgery
and diagnostic procedures the first three
centres in wycombe medway and portsmouth
are now open on time and to budget and
performing well the fourth and largest centre in
midsussex will open at the end of june
mercury health has a significant market share of
this emerging market and is well placed to
develop into a major uk healthcare provider we
are currently bidding for several contracts as part
of the £35bn phase 2 procurements for
diagnostics and elective surgery 
we are also bidding for a number of primary care
opportunities and we announce today our first
primary care contract in city  hackney this
contract is an important first step in the
development of our primary care business  dividend
the board is pleased to announce that it is
recommending a final dividend of 225p per
share making a total of 33p per share for the
year 2005 30p subject to approval at tribal’s
2006 annual general meeting this dividend will
be paid on 13 october 2006 to tribal’s
shareholders on the register at 22 
september 2006
people
tribal is a peoplebased business and its success
is a result of the broad base of talented employees
across the group we would like to put on record
the thanks of the board to our 2300 staff at all
levels their efforts have ensured that tribal
continues to be one of the most respected and
dynamic companies in its markets 
seasonal weighting
our business has always been weighted to the
second half and in particular to the final quarter
of the year the weighting towards the second
half of the year will be even more pronounced
this year with first half profits and earnings
expected to be below last year 
this is partly due to the increasing seasonal
weighting of revenue to the second half in line
with government spending however this year
the first half will also be impacted by higher
mercury health bid costs higher interest costs
as a result of the group’s investment in mercury
health and only a partial contribution from
mercury health’s largest centre in midsussex
tribal group plc   report and accounts 2006   03
prospects
tribal is firmly established as a major supplier of
high valueadded consulting education and
healthcare delivery services we have a robust
business model with a balanced and extensive
range of services operating across public sector
markets we are well placed to capitalise on the
increasing number of opportunities arising from
the government’s public sector reform agenda 
we continue to diversify our service offering
focusing primarily on delivering organic growth
increasing the level of committed revenue by
winning long term contracts and by leveraging
our relationships and advisory expertise to
develop delivery services in our principal markets  
we have strengthened our divisional
management structure during the year and are
now in a stronger position to achieve further
improvements in margins through both
operational efficiency and the centralisation of
support services
the board is confident about the group’s
prospects
strone macpherson
chairman
20 june 2006
02 03 04 05 06
2599
2295
1857
1057
457
02 03 04 05 06
190
178
201
154
81
adjusted diluted earnings per share
profit before taxation £m
turnover £m
02 03 04 05 06
172p
153p
205p
186p
142p